Ostrovskaya v. Allegro Cozumel Resort
- Haywood Gilliam
- 4:18-cv-06903
- U.S. District Court · Northern District of California
- 4
In Ostrovskaya v. Allegro Cozumel Resort, Judge Gilliam approved the minors’ settlement and sealing request, ending the suit.
The order directly affected the minor plaintiffs, the other parties to the settlement, the plaintiffs’ attorneys, and nonparties whose information or trade secrets were covered by the sealing request.
What happened
In Ostrovskaya v. Allegro Cozumel Resort, the court considered a joint request to approve a settlement involving minor plaintiffs and a request to keep limited information confidential.
The court found the settlement fair and reasonable for the minors because it provided certain recovery despite disputed liability, litigation uncertainties, and possible personal-jurisdiction problems. It approved placing the minors’ settlement payments in accounts for their benefit and approved the requested attorney fees and costs.
Judge Gilliam also approved narrowly tailored redactions covering the minors’ settlement amounts, trade secrets, and information about nonparties. The order granted both motions and terminated the case-related motions identified in the order.
The detailed version
- Ostrovskaya v. Allegro Cozumel Resort · No. 4:18-cv-06903
- Haywood Gilliam
- Feb. 20, 2020
Background
The plaintiffs and defendants jointly asked the court to approve a settlement involving minor plaintiffs. They also jointly asked to file limited information under seal. The opinion does not describe the underlying claims or state the settlement amounts.
The court explained that federal courts have a special duty to protect minors who are parties to a case. Before approving a settlement for a minor, the court must independently determine whether the settlement is fair, reasonable, and in the minor’s best interests. The court also noted that defendants had filed a colorable motion to dismiss, including an argument that the court lacked personal jurisdiction—the legal power to exercise authority over the defendants.
Settlement Approval
Based on the parties’ submissions, the court found the proposed settlement fair and reasonable and in the minors’ best interests. The settlement offered the minors a certain recovery instead of the uncertainty and delay of continued litigation, where liability was contested and the case presented substantial difficulties.
The court granted approval of the minors’ compromise and approved distributing the settlement amounts owed to the minor plaintiffs into accounts at Morgan Stanley under the Uniform Transfers to Minors Act in California. It also found the requested attorney fees and costs fair and reasonable and approved their distribution as described in the motion.
Sealing Request
Because approving the settlement would end the suit, the court applied the “compelling reasons” standard to the sealing request. Under that standard, a party seeking to seal court records must identify strong reasons for confidentiality and request only limited redactions supported by specific facts.
The parties sought to seal limited confidential information concerning the minor plaintiffs, trade secrets, and information related to nonparties. The court agreed that the minors’ settlement amounts qualified as personal financial information, particularly because the minors would not have access to the funds until age 25 under the compromise terms. The court found that the request was narrowly tailored, that the redactions were modest, and that each category of information satisfied the compelling-reasons standard.
Disposition
The court granted the motion for approval of the compromise and granted the administrative motion to file under seal. The order states that it terminated Docket Nos. 9 and 27.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.