Silverman v. Citibank, N.A.

Background

Citibank filed three motions to seal in 2022. The first sought to seal portions of the complaint. The second sought to seal portions of Citibank’s motion to dismiss and several exhibits. The third sought to seal portions of Citibank’s reply memorandum supporting its motion to dismiss.

On March 31, 2023, the court rejected most of the proposed redactions in the first two motions but allowed redactions for sensitive information covered by Federal Rule of Civil Procedure 5.2 and the court’s Individual Rule 4(A)(i). The court asked the parties for additional briefing on whether redactions to paragraphs 4 and 96 of the complaint were required by the Bank Secrecy Act or the Patriot Act. Instead of providing that briefing, Citibank sent a letter stating that the parties had agreed to those redactions.

Court’s analysis

The court applied the three-step standard governing public access to court filings. It determined whether the material was a “judicial document,” assessed the strength of the public-access presumption, and balanced that presumption against interests favoring confidentiality.

The court determined that the complaint was a judicial document and that the presumption of public access was very strong because the information appeared in a complaint. The court rejected the parties’ agreement as a sufficient basis for sealing because agreements between parties cannot, by themselves, overcome the public’s interest in access to judicial documents.

The court also found that Citibank had not cited authority showing that the plaintiff, who disclosed the information in the complaint, was subject to the Bank Secrecy Act’s disclosure prohibition. The court stated that the statute applies to a specified group of people and entities that does not include third parties such as the plaintiff. It reached a similar conclusion regarding the Patriot Act regulation, which limits disclosures by financial institutions or associations of financial institutions.

Finally, the court stated that, even assuming the plaintiff had to comply with those laws, it was not persuaded that the challenged allegations violated either law. The allegations that Citibank reported concerns to the Financial Crimes Enforcement Network and was required to report knowledge or suspicions about Nissen’s conduct did not, standing alone, clearly identify a suspicious-activity report. The court also stated that the Patriot Act provision cited by Citibank restricts disclosure of information received through a request, not the fact that a request was made.

Ruling and directives

The court denied the remaining proposed redactions to paragraphs 4 and 96 of the complaint requested in Citibank’s first motion. It also denied Citibank’s third motion for the reasons stated in the court’s March 31, 2023 orders. The court stated that no other sealing disputes remained and directed the clerk to terminate the motions pending at Dkt. Nos. 53 and 63.

The plaintiff was ordered to file an unredacted complaint within 14 days. Citibank was ordered to file unredacted versions of its memorandum supporting its motion to dismiss and its reply memorandum, as well as unredacted versions of exhibits 1–4 and 12, except for sensitive information covered by Federal Rule of Civil Procedure 5.2 and the court’s Individual Rule 4(A)(i), within 14 days of the order.