Portal Instruments, Inc. v. LEO Pharma A/S

Background

Portal Instruments, Inc. initiated the action by filing a redacted complaint on October 25, 2022. The complaint referred to exhibits that were not filed. Portal Instruments later moved to file the complaint and two exhibits under seal. LEO Pharma A/S filed a letter supporting the motion, and Portal Instruments took no position.

The proposed sealing covered the amounts LEO Pharma paid Portal Instruments, allegations that LEO Pharma failed to perform under the contract and breached the implied duty of good faith, the agreement itself, and LEO Pharma’s notice terminating the agreement. LEO Pharma relied on a confidentiality provision in the contract.

Court’s Analysis

The court applied the three-part test for sealing judicial documents. First, it determined whether the materials were judicial documents subject to a presumed right of public access. Second, it assessed the strength of that presumption based on the materials’ connection to the exercise of federal judicial power and their value to the public. Third, it balanced the presumption against competing interests, including privacy and the protection of specific business information and strategies.

The court concluded that the complaint and its exhibits were judicial documents. Because the complaint initiated the case and was central to understanding the court’s work, the presumption of public access was particularly strong. A contractual confidentiality provision, standing alone, did not overcome that presumption.

The court found LEO Pharma’s explanations conclusory. LEO Pharma described the contract payments as competitively sensitive financial information but gave no reason, apart from the contract’s confidentiality provision, to conclude that the information was sensitive. LEO Pharma also referred to confidential research and development information but did not explain how disclosure of the allegations would cause competitive harm. It likewise did not identify what sensitive information appeared in the termination notice or how disclosure could plausibly harm LEO Pharma.

Ruling

Judge Lorna G. Schofield ordered that LEO Pharma’s motion to seal was DENIED, without prejudice to renewal. If LEO Pharma wished to renew the motion, the court directed it to file a renewed letter motion by December 23, 2022, attaching the complaint and exhibits with narrowly tailored proposed redactions. The renewed submission had to specifically explain how disclosure could plausibly cause competitive harm or otherwise overcome the strong presumption of public access. The court also directed the parties to follow the applicable individual rules requiring documents sought to be sealed to be filed electronically on the court’s filing system at the same time as the sealing motion.