Johnson v. Saba Capital Management, L.P.

Background

Charles B. Johnson, as trustee of the Johnson Family Trust, and Templeton Global Income Fund asked the court to seal fifteen documents or portions of documents that the parties had submitted with their papers concerning Plaintiffs’ motion for a preliminary injunction. The materials included exhibits to declarations supporting Plaintiffs’ motion and exhibits to Defendants’ opposition.

Plaintiffs described the materials as including internal communications and board meeting materials involving Templeton Global Income Fund; communications and nonpublic contracts with entities that were not parties to the case; excerpts from depositions of Franklin Templeton personnel; and excerpts from a nonparty’s deposition. Plaintiffs argued that the exhibits contained proprietary business strategies, analyses, impressions, and concerns about sensitive matters, including negotiations and contracts.

Defendants objected in part. They argued that only five of the fifteen exhibits were at issue and contended that four of Defendants’ exhibits and one of Plaintiffs’ exhibits should be filed in full. Defendants did not oppose partial redactions of three exhibits to remove references to other funds. Defendants also argued that some of the requested material had already been publicly disclosed.

Legal standard

The court explained that judicial documents—materials relevant to the court’s work and useful in the legal process—are subject to a common-law presumption of public access. The presumption is strongest when the materials relate to a motion that could resolve claims. A party seeking to seal judicial documents must make specific factual findings showing that sealing is necessary to protect a higher value and must request no more sealing than necessary.

Confidential or proprietary business information can sometimes justify sealing, but general statements that documents contain confidential business information are not enough. The party seeking sealing must specifically show that disclosure would cause a serious enough injury to warrant protection. Information about nonparties may also deserve redaction, but the request must explain why particular material should remain sealed.

Court’s analysis

Plaintiffs conceded that the fifteen documents were judicial documents. The court concluded that Plaintiffs had not met their burden to overcome the presumption of public access. In particular, the court found that Plaintiffs had not made a narrowly tailored sealing request and had relied on general statements about confidential business information.

The court also noted that Plaintiffs offered no explanation for why some material involving nonparties should remain sealed, even though some nonparty information may traditionally be considered private and may support redaction. Accordingly, the court denied the request to seal the fifteen documents.

Disposition

Judge Torres denied Plaintiffs’ motion to seal. By October 28, 2022, Plaintiffs could propose narrowly tailored redactions to the fifteen exhibits and provide a detailed explanation supporting each proposed redaction. The clerk was directed to terminate the motion at docket entry 69.