Cambria Company LLC v. Disney Worldwide Services, Inc.

Background

Cambria Company LLC brought a breach-of-contract claim against Disney Worldwide Services, Inc., alleging that Disney owed more than $500,000 for quartz slabs Cambria delivered. The dispute concerns a “Blanket Purchase Agreement – Quartz Master Agreement.” Disney submitted the agreement under seal with materials supporting its motion to dismiss. The court denied that motion.

The parties later disputed whether the agreement should remain sealed. Attachment A contained product-pricing information, Cambria’s rebate-program information, and freight terms. Attachment B contained purchase-order terms and conditions. Magistrate Judge John F. Docherty ordered Disney to file a public version of the agreement with only parts of Attachment A redacted. After Disney sought further consideration, Magistrate Judge Docherty again declined to keep the entire agreement sealed, concluding that the possible competitive harm did not outweigh the strong presumption that judicial records should be public.

Disney’s Objection

Disney appealed the magistrate judge’s order under the applicable local rules. Disney argued that disclosure could cause competitive harm by revealing confidential business terms, contractual arrangements, termination conditions, indemnity responsibilities, and warranty provisions. Cambria opposed the appeal, arguing that the agreement’s terms were standard, more than seven years old, and had been referenced in Disney’s public filings.

Court’s Analysis

The district court treated the sealing dispute as a nondispositive pretrial matter, meaning a matter that does not decide the main claim. It therefore reviewed the magistrate judge’s decision under the highly deferential “clearly erroneous or contrary to law” standard. Under that standard, reversal is appropriate only when the district court has a firm conviction that a mistake was made.

The court explained that judicial filings carry a common-law presumption of public access. A party seeking to keep documents sealed must weigh its confidentiality interests against the public’s interest in access. Because Disney filed the agreement with a motion to dismiss, the court applied a heightened burden for sealing documents filed with a dispositive motion—a motion that could resolve the case.

The court concluded that Magistrate Judge Docherty had considered Disney’s claimed competitive harm, including the possible effect of disclosure on Disney’s future negotiations with vendors. The magistrate judge had also required redactions for the most sensitive business information in Attachment A. The district court held that Disney had not identified evidence the magistrate judge ignored and had not shown that the claimed harm outweighed the public interest in access. The fact that some relevant portions of the agreement had already become public did not change the analysis, because the agreement could remain relevant as the case proceeded.

Disposition

Judge John R. Tunheim denied Disney’s Objection to the Order on Motion for Further Consideration of Continued Sealing. The court also affirmed the magistrate judge’s Order on Motion for Further Consideration of Continued Sealing. The agreement therefore was not kept entirely under seal; the order required redaction only of parts of Attachment A.