Apex.AI, Inc. v. Langmead

Background

Apex.AI, Inc. brought an action against Neil Richard Langmead, Verifa, Inc., CodeClinic LLC doing business as Lattix, and Does 1–20. The opinion says the dispute concerns alleged trade-secret misappropriation and breach of a Consulting Agreement. Apex.AI hired Langmead under that agreement to help ensure that its software met applicable safety requirements. Apex.AI alleged that Langmead acquired its proprietary information, including trade secrets, and disclosed trade secrets and confidential information.

Apex.AI filed suit seeking temporary, preliminary, and permanent injunctive relief and filed an application for a temporary restraining order. It then moved to seal portions of its memorandum supporting that application, declarations from Dejan Pangercic and Dmytro Tutynin, and Exhibits A–F to Tutynin’s declaration. The opinion states that the defendants had appeared through counsel but did not respond to the sealing motion.

Sealing Standard

A motion to seal asks the court to restrict public access to court filings. The court explained that filings more closely related to the merits of a case may be sealed only for “compelling reasons.” Under the Northern District of California’s Civil Local Rule 79-5, the requesting party must identify the interests supporting sealing, the injury that could result from disclosure, and why a less restrictive alternative would not suffice. The proposed sealing must also be narrowly tailored.

Because the materials Apex.AI identified concerned the merits of the case, the court applied the compelling-reasons standard.

Court’s Analysis

The court granted Apex.AI’s request to seal designated portions of the memorandum and the Pangercic and Tutynin declarations. Those portions contained detailed information about Apex.AI’s business arrangements, plans for specific software products, and partner and customer identities. The court found that competitors could use the information to undercut Apex.AI and harm its ability to compete. It also found that the request was narrowly tailored to seal only material that could properly be sealed.

The court separately granted the request to seal Exhibits A–F in their entirety. According to the opinion, those exhibits contained business arrangements, internal financial documents, technical documents, source code, and data extracted from a work laptop. The court also noted that disclosure of internal financial information and receipts for professional services could impair Apex.AI’s negotiations with customers. It found that the exhibits were sealable in full and did not contain significant amounts of information that should remain public.

Order and Effect

The court granted Apex.AI’s administrative motion to seal. It ordered under seal the designated portions on pages 10–12, 15, and 17 of the memorandum; paragraphs 49, 56–58, and 61 of Pangercic’s declaration; paragraphs 6.b, 6.c, and 6.d of Tutynin’s declaration; and all of Exhibits A–F to Tutynin’s declaration. The order also terminated ECF 5. The opinion did not decide the underlying trade-secret or contract claims or the application for a temporary restraining order. Judge Beth Labson Freeman issued the order.