Tyntec Inc. et al v. Syniverse Technologies, LLC

Middle District of Florida, flmd-8:2017-cv-00591

Response to order to show cause

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0 PageID 27601 UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA TAMPA DIVISION TYNTEC INC., a Delaware Corporation and TYNTEC GROUP LTD. f/k/a Phoenix Spring Ltd., a United Kingdom Corporation, Case No. 8:17-CV-00591-SDM-SPF Plaintiffs, v. SYNIVERSE TECHNOLOGIES, LLC, a Delaware Corporation Defendant. DEFENDANT SYNIVERSE TECHNOLOGIES, LLC'S RESPONSE TO ORDER FOR SHOW CAUSE AND UNOPPOSED MOTION TO MAINTAIN CERTAIN DOCUMENTS UNDER SEAL INTRODUCTION In response to this Court's September 3, 2019 Order to Show Cause (Doc. 224) and pursuant to Local Rule 1.09, Defendant Syniverse Technologies, LLC ("Syniverse") hereby respectfully moves this Court to maintain under seal certain filings and/or their associated exhibits identified in the Court's Show Cause Order. For many of the filings and exhibits referenced in the Show Cause Order, Syniverse does not oppose their being unsealed in their entirety. A list of these documents is attached as Exhibit 1. For a limited number of documents, Syniverse requests that they be kept under seal in their entirety. A list of these documents is attached as Exhibit 2. The remaining documents subject to the Show Cause Order contain portions—often only small parts or a handful of words out of voluminous documents or transcripts—that reflect Syniverse's confidential business information. Accordingly, these 1 0 PageID 27602 documents should remain under seal, but, at the Court's direction, Syniverse proposes that it be permitted to file redacted versions that would be publicly available on the Court's docket. A list of these documents is attached as Exhibit 3. tyntec does not oppose Syniverse's motion. Much of Syniverse's business model is built on contracting with customers to provide ICV and other telecommunication services and the specific terms of Syniverse's contracts are competitively sensitive and proprietary business information that Syniverse works very hard to keep confidential. The allegations in this case directly implicate Syniverse's contracting practices and the details of its contract terms, pricing, and business strategies, and Syniverse produced documents and provided testimony related to these sensitive issues in reliance on the Protective Order entered by this Court. (Doc. 87). In fact, these competitively sensitive details are central to the summary judgment and Daubert motions that are subject to the Show Cause Order. Because of that, the Court (and potentially the Court of Appeals) must have access to these details, which are scattered throughout the filings currently under seal. If Syniverse is required to unseal and publicly disclose the contents of all the filings and their exhibits—which includes Syniverse's confidential contract terms and other competitively sensitive information, some of which is also subject to contractual non-disclosure agreements with other third parties— then Syniverse's competitors and customers could use that information against it in future negotiations to Syniverse's competitive disadvantage. Nonetheless, Syniverse recognizes the public's right to access court records. To bridge this gap, Syniverse respectfully requests that the Court allow it to prepare and submit public versions of the documents identified in the Show Cause Order and listed in the attached Exhibits 2 and 3, which would contain redactions or slip sheets for those documents that contain 2 0 PageID 27603 confidential business information. These public versions would be filed on the docket and available to the public. The Court (and the Parties) would retain access to unredacted, sealed versions of those filings. For the briefs and many of the exhibits at issue there are only limited excerpts that Syniverse would seek to protect, meaning that Syniverse expects to unseal the vast majority of the record currently under seal. This approach would largely provide the public with the constitutionally-protected right of access to court documents, while also protecting Syniverse's confidential business information.1 If the Court determines that this is not a viable approach, then Syniverse requests that the documents listed in Exhibits 2 and 3 remain under seal in their entirety for a period of 5 years. LEGAL STANDARD The Local Rules recognize that sealing of court filings may be necessary in "extraordinary circumstances," including the "protection of trade secrets or other valuable proprietary information." L.R. 1.09(a). Local Rule 1.09(a) also provides that a motion to seal must include: (i) an identification and description of each item proposed for sealing; (ii) the reason that filing each item is necessary; (iii) the reason that sealing each item is necessary; (iv) the reason that a means other than sealing is unavailable or unsatisfactory to preserve the interest advanced by the movant in support of the seal; (v) a statement of the proposed duration of the seal; and (vi) a memorandum of legal authority supporting the seal. Id.2 This Court has recognized that "[t]he common-law right of access is 'an essential component of our system of justice' and 'is instrumental in securing the integrity of the process.'" Doc. 224 1 If it would assist the Court in evaluating Syniverse's request, Syniverse can file sealed versions of these documents with its proposed redactions highlighted. 2 This Court has already granted motions to seal the documents at issue. See Docs. 82 at 27:2-13; 115; 123; 125; 139; 145; 151. But rather than provide the Court with the more limited information required under Local Rule 1.09(b) & (c), Syniverse, through this brief and attached exhibits, provides the additional information required by Rule 1.09(a). 3 0 PageID 27604 (quoting Chi. Tribune Co. v. Bridgestone/Firestone, Inc., 263 F.3d 1304, 1311 (11th Cir. 2001)). This "includes the right to inspect and copy public records and documents." Chi. Tribune, 263 F.3d at 1311 (citing Nixon v. Warner Comm., Inc., 435 U.S. 589, 597 (1978)). "The right to inspect and copy is not absolute, however, and a judge's exercise of discretion in deciding whether to release judicial records should be informed by a sensitive appreciation of the circumstances that led to. . . [the] production [of the particular document in question]." Chi. Tribune, 263 F.3d at 1311 (internal quotations omitted). For example, "courts have refused to permit their files to serve as … sources of business information that might harm a litigant's competitive standing." Nixon v. Warner Commc'ns., Inc., 435 U.S. 589, 598 (1978). "A party's interest in the privacy of its financial records and the terms of confidential agreements may outweigh the public's right of access." Local Access, LLC v. Peerless Network, Inc., No. 6:14- cv-399-Orl-40TBS, 2017 U.S. Dist. LEXIS 72511, at *8 (M.D. Fla. May 12, 2017) (citing Graphic Packaging Int'l, Inc. v. C.W. Zumbiel Co., No. 3:10-cv-891-J-JBT, 2010 U.S. Dist. LEXIS 143284, at *1 (M.D. Fla. Oct 27, 2010); MEDai, Inc. v. Quantros, Inc., No. 6:12-cv-840- Orl-37GJK, 2012 U.S. Dist. LEXIS 90318, at *2-3 (M.D. Fla. June 29, 2012). Rule 26(c) provides for protection of "trade secret or other confidential research, development, or commercial information" upon a showing of good cause. Fed. R. Civ. P. 26(c)(1)(G); see also Chi. Tribune, 263 F.3d, at 1313. Such "[g]ood cause is established by the moving party when disclosure will cause the party to suffer a clearly defined and serious injury." NXP B.V. v. Research In Motion, Ltd., No. 6:12-cv-498-Orl-22TBS, 2013 U.S. Dist. LEXIS 115576 at *2 (M.D. Fla. Aug. 15, 2013). "Federal courts have superimposed a balancing of interests approach for Rule 26's good cause requirement" which "requires the district court to 4 0 PageID 27605 balance the party's interest in obtaining access against the other party's interest in keeping the information confidential." Chi. Tribune, 263 F.3d, at 1313 (citations omitted). In applying this balancing of interests approach "courts consider, among other factors, whether allowing access would impair court functions or harm legitimate privacy interests, the degree of and likelihood of injury if made public, the reliability of the information, whether there will be an opportunity to respond to the information, whether the information concerns public officials or public concerns, and the availability of a less onerous alternative to sealing the documents." Romero v. Drummond Co., 480 F.3d 1234, 1246 (11th Cir. 2007). The commonly accepted criteria to show that certain information constitutes "trade secrets" includes (i) that the moving party "must have consistently treated the information as closely guarded secrets;" (ii) that "the information represents substantial value to the moving party;" (iii) that "it would be valuable to [the moving party's] competitors;" and (iv) "that it derives its value by virtue of the effort of its creation and lack of dissemination." Chi. Tribune, 263 F.3d, at 1313-14. "There is no objection to an order that allows the parties to keep their trade secrets (or some other properly demarcated category of legitimately confidential information) out of the public record, provided the judge (1) satisfies himself that the parties know what a trade secret is and are acting in good faith in deciding which parts of the record are trade secrets and (2) makes explicit that either party and any interested member of the public can challenge the secreting of particular documents." Citizens First Nat'l Bank v. Cincinnati Ins. Co., 178 F.3d 943, 946 (7th Cir. 1999). 5 0 PageID 27606 ARGUMENT: The Documents Identified in Exhibits 2 and 3 Contain Information that Constitutes Trade Secrets and that Should Therefore Be Kept Under Seal Syniverse seeks to keep under seal only that information that it treats as confidential and which would cause competitive harm if it were publicly disclosed to Syniverse's competitors and customers. For example, Syniverse proposes maintaining under seal in their entirety certain highly confidential customer contracts, peering agreements, and other contracts,3 highly confidential pricing sheets, and certain negotiation documents, correspondence, and business strategy presentations containing highly confidential contract terms with counterparties and details of Syniverse's proprietary business strategy.4 In addition, Syniverse proposes applying minimal redactions to some of the briefs, deposition transcripts, and other filings to protect specific financial terms of its customer contracts, details of Syniverse's profit margins, general business strategy, and Syniverse's customer lists, including the names of counterparties of Syniverse contracts.5 Courts in the Eleventh Circuit, including many in this district, have determined that such information warrants redaction or sealing of documents in their entirety. See Local Access, LLC, 2017 U.S. Dist. LEXIS 72511, at *4 (granting motions to seal documents containing the movant's "business plans, pricing information, and technical capabilities"); Pledger v. Reliance Tr. Co., NO. 1:15-CV-4444-MHC, 2019 U.S. Dist. LEXIS 45668, at *56 (N.D. Ga. Feb. 25, 2019) (granting motions to seal "financial information, client names," "income, expenses, headcount, and employee salaries" through redaction or sealing of entire documents); Graphic 3 These contracts not only reveal Syniverse's trade secrets, but also contain non-disclosure provisions that obligate Syniverse to keep such contracts confidential. 4 These documents are identified in the attached Exhibit 2. 5 These documents are identified in the attached Exhibit 3. 6 0 PageID 27607 Packaging Int'l, Inc., 2010 U.S. Dist. LEXIS 143284, at *1; MEDai, Inc., 2012 U.S. Dist. LEXIS 90318, at *2-3. This is because the information Syniverse seeks to protect clearly constitutes trade secrets, as outlined by the Eleventh Circuit in Chicago Tribune. See 263 F.3d, at 1313. First, Syniverse has consistently treated this information as closely guarded secrets, prohibiting public disclosure and restricting access to such information. Second, this information has significant independent economic value to Syniverse by virtue of its restriction from public disclosure and lack of public dissemination. Finally, if such information were publicly disclosed, it would plummet in economic value to Syniverse (while skyrocketing in economic value to its competitors and customers) because it would give Syniverse's competitors and counterparties insights into its business that they would not otherwise have. This could significantly disadvantage Syniverse in future negotiations with potential customers and other contracting parties. See Nixon, 435 U.S. at 598 ("[C]ourts have refused to permit their files to serve as … sources of business information that might harm a litigant's competitive standing"). In accordance with Local Rule 1.09(a), Syniverse has attached as Exhibits 2 and 3 charts providing (i) an identification and description of each item proposed for sealing6 or redacting7; (ii) the reason that filing each item is necessary; (iii) the reason that sealing each item is necessary; and (iv) the reason that a means other than sealing is unavailable or unsatisfactory to preserve the interest advanced by the movant in support of the seal. Due to the sensitive nature of the materials in Exhibits 2 and 3, the duration of the contracts and pricing at issue, and because of the potential for competitive harm to Syniverse if this material is publicly disclosed, there is 6 See Exhibit 2. 7 See Exhibit 3. 7 0 PageID 27608 good cause to extend the time for sealing beyond one year as outlined in Local Rule 1.09(c). In addition, many of the customer contracts are subject to non-disclosure provisions that require Syniverse to keep their terms confidential during the life of the contract and even for a period of years after expiration. Accordingly, Syniverse requests that these items remain sealed for a period of five years. CONCLUSION For the reasons set forth above, Syniverse respectfully requests that the Court (i) maintain under seal the documents identified in Exhibits 2 and 3, and (ii) permit Syniverse to submit proposed redactions of the documents identified in Exhibit 3 within 14 days of the Court's decision on the matter. In the alternative, and based on the arguments above, Syniverse requests that this Court maintain all documents identified in Exhibit 3 under seal in their entirety if the Court determines that applying redactions to the public filings would not be an appropriate means of providing public access to the record. Respectfully submitted, /s/ Anthony Greene Mark A. McCarty (admitted pro hac vice) Benjamin H. Hill, III (FBN: 94585) Mark.McCarty@alston.com Matthew F. Hall (FBN: 92430) John E Stephenson, Jr. (admitted pro hac vice) HILL, WARD, HENDERSON, P.A. Valarie C. Williams (admitted pro hac vice) 101 East Kennedy Blvd. Suite 3700 Kara Kennedy (admitted pro hac vice) Tampa, Florida 33602 Anthony Greene (admitted pro hac vice) Tel.: 813-221-3900 ALSTON & BIRD LLP 1201 W. Peachtree Street Atlanta, Georgia 30309 Tel.: 404-881-7000; Fax: 404-881-7777 Attorneys for Defendant 8 0 PageID 27609 CERTIFICATE OF CONFERENCE Pursuant to Rule 3.01(g) of the Local Rules of the United States District Court for the Middle District of Florida, the undersigned counsel hereby certifies that moving counsel has conferred with opposing counsel. Opposing counsel do not oppose this motion. DATED this 27th day of September, 2019. /s/ Anthony Greene Attorney for Defendant 0 PageID 27610 CERTIFICATE OF SERVICE I HEREBY CERTIFY that in accordance with the Middle District of Florida's electronic filing procedures, this document has been electronically filed on September 27, 2019. A Notice of Electronic filing will be sent by the Court to all counsel of record who have consented to e-mail notification and electronic service, including the following: William Christopher Carmody (admitted Amanda Bonn (admitted pro hac vice) pro hac vice) Meng Xi (admitted pro hac vice) Shawn J. Rabin (admitted pro hac vice) 1900 Avenue of the Stars, Suite 1400 Jason C. Bertoldi (admitted pro hac vice) Los Angeles, CA 90067 SUSMAN GODFREY L.L.P. (310) 789-3100 1301 Avenue of the Americas, 32nd Floor abonn@susmangodfrey.com New York, NY 10019 mxi@susmangodfrey.com (212) 336-8330 bcarmody@susmangodfrey.com Daniel P. Dietrich srabin@susmangodfrey.com Florida Bar No. 934461 jbertoldi@susmangodfrey.com GUNSTER, YOAKLEY & STEWART, P.A. 401 East Jackson Street, Suite 2500 Vineet Bhatia (admitted pro hac vice) Tampa, FL 33602 1000 Louisiana, Suite 5100 (813) 739-6970 Houston, TX 77002 ddietrich@gunster.com (713) 651-9366 vbhatia@susmangodfrey.com Stephen M. Medlock (admitted pro hac vice) MAYER BROWN LLP 1999 K Street, N.W. Washington, D.C. 20006 (202) 263-3000 smedlock@mayerbrown.com This document is available for viewing and downloading from the Court's ECF system. /s/ Anthony Greene Attorney for Defendant