Nanometrics, Incorporated v. Optical Solutions, Inc.

Background

The court addressed three administrative motions concerning exhibits filed with summary-judgment papers: Nanometrics’s motion to seal exhibits supporting its motion for summary judgment, Optical’s motion concerning exhibits supporting its opposition, and Nanometrics’s response to Optical’s motion. The cases were consolidated, and the opinion states that the court refers to Optical as the plaintiff and Nanometrics as the defendant.

The parties relied on designations under their protective order, including “Highly Confidential – Attorneys’ Eyes Only” and “Confidential.” Nanometrics sought protection for information concerning research and development, technical designs, product performance testing, internal communications, and business strategies. Nanometrics asserted that the information was not publicly disclosed, or was disclosed externally only under nondisclosure agreements, and that public disclosure could reveal research and development information and strategic business decisions to competitors.

Legal standard

Judicial records are generally presumed open to the public. Because the sealing requests concerned materials related to summary judgment, the parties had to show “compelling reasons,” supported by specific facts, that outweighed the public’s interest in access. The court explained that compelling reasons can include protecting trade secrets and business information that could harm a party’s competitive position. A protective order or a confidentiality designation alone was not enough. Requests also had to be narrowly tailored to seal only material that required protection.

Ruling on the exhibits

The court found compelling reasons to seal information that would reveal Nanometrics’s research and development, technical designs, product-performance analyses, trade secrets, and business strategies. It therefore granted several requests in full, including requests concerning Exhibits 44, 50, 54, 56, B, N, O, FF, KK, W, and X, as well as the identified portions of Exhibits C, P, R, Y, Z, and PP. The court also granted the requests for highlighted portions of Exhibits 44, 49, and 56 where the material contained confidential product-performance analyses or related technical information.

The court granted in part and denied in part the requests concerning Exhibits 46, 47, 49, A, U, and HH. For Exhibits 46, 47, and A, the court found that the sealable technical documentation began on the second page, but the parties had not supported sealing the entire first page, including email fields and introductory email language. For Exhibit 49, the proposed redactions included a full page containing material, such as email fields, that had not been shown to be sealable. For Exhibit U, the court denied sealing as to portions on every page that included email fields and introductory language lacking sufficient support. For Exhibit HH, the court denied sealing as to similar portions that had not been shown to require protection.

The court denied the request concerning Exhibit J because Nanometrics responded that the document did not require sealing. For Exhibit P and Exhibit R, the court granted sealing only as to the highlighted portions identified in the filing. For Exhibit C and Exhibit Y, it likewise granted sealing as to the highlighted portions containing sensitive deposition testimony about Nanometrics’s technical trade secrets and commercially sensitive business opportunities. The court granted the requests concerning Exhibits N and O because they consisted only of technical documentation, diagrams, and handwritten annotations disclosed under a nondisclosure agreement.

Required filings

The court ordered Nanometrics to refile Exhibits 46, 47, and 49 to its summary-judgment motion within seven days, using redactions consistent with the order. Nanometrics also had to provide Optical with redacted versions of Exhibits A, C, J, P, R, U, Y, Z, HH, and PP within seven days. Optical then had five days after receiving those redacted exhibits to refile them with its opposition.

Disposition

The court granted in part and denied in part the administrative motions to seal.