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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1 PageID 27665 UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF FLORIDA TAMPA DIVISION TYNTEC INC., a Delaware Corporation, and CASE NO. 8:17-cv-591-T-23SPF TYNTEC GROUP LTD. f/k/a Phoenix Spring Ltd., a United Kingdom Corporation, Plaintiffs, v. SYNIVERSE TECHNOLOGIES, LLC, a Delaware Corporation, Defendant. PLAINTIFFS' RESPONSE TO SHOW CAUSE ORDER AND UNOPPOSED MOTION TO SEAL I. INTRODUCTION Pursuant to Local Rule 1.09 and the Court's Order dated September 3, 2019 (Doc. 245) directing the parties to demonstrate sufficient legal show cause to continue sealing certain docket entries, Plaintiffs tyntec Inc. and tyntec Group Ltd. (together, "tyntec") respectfully file this Response and Unopposed Motion to Seal two third-party documents containing confidential business information. tyntec itself does not seek to keep any of the docket entries enumerated in the September 3, 2019 Order sealed; however, tyntec submits this response and motion to satisfy the contractual confidentiality obligation it owes to two of its customers—neither a party to the lawsuit. Under the terms of tyntec's business agreements with these unaffiliated third parties, tyntec owes an obligation to protect any confidential information belonging to these parties received in the course and as a result of their business relationships. See Declaration of Meng Xi, submitted concurrently herewith. 1 PageID 27666 Accordingly, tyntec requests that the Court continue to seal, for the duration of this lawsuit and during the pendency of any appeal, the two confidential documents identified below because of the sensitive content of these documents, the public disclosure of which could have detrimental effects on the business relationships of tyntec's customers and place them at a competitive disadvantage to others within their respective industries. These documents are (1) a confidential agreement titled "Agreement on Messaging Services" between tyntec and a third party that was produced in discovery at TYNT00058928-TYNT00058987 (the "Agreement"), and (2) a transcript of the April 23, 2018 deposition of Erik Levitt (the "Levitt Deposition Transcript") as the Fed.R.Civ.P 30(b)(6) witness for Shelcomm, Inc. ("Shelcomm"), a non-party to the lawsuit. Both of these documents are confidential and contain sensitive business information, and have been designated as confidential or "Highly Confidential – Outside Counsel's Eyes Only" under the terms of the Protective Order entered in the case. tyntec submits the accompanying Memorandum of points and legal authorities, declaration of Erik Levitt, and declaration of Meng Xi in support of its motion to seal. II. LEGAL STANDARD FOR SEALING In this district, the proponent of 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 for sealing each item; (iv) the reason that a means other than sealing is unsatisfactory to preserve the interest advanced by the motion to seal; (v) a statement of the proposed duration of the seal; and (vi) a memorandum of law. See Local Rule 1.09(a). In the Eleventh Circuit, a trial court has wide discretion in limiting public access to information upon a showing of good cause by the party seeking protection. Romero v. Drummond Co., 480 F.3d 1234, 1245 (11th Cir. 2007). The good cause inquiry requires "balance[ing] the 2 1 PageID 27667 asserted right of access against the other party's interest in keeping the information confidential." Chicago Tribune Co. v. Bridgestone/Firestone, 263 F.3d 1304, 1309 (11th Cir. 2001). "[W]hether good cause exists [is] decided by the nature and character of the information in question." Id. at 1315. III. DESCRIPTION OF EACH ITEM PROPOSED FOR SEALING tyntec requests the continued sealing of two documents containing the confidential business information of tyntec's customers, who are non parties to the lawsuit. First, tyntec seeks the continued sealing of the "Agreement on Messaging Services" between tyntec and a third party relating to tyntec's provision of products and services, on the basis that tyntec continues to owe a contractual obligation to its customer to protect the confidential information contained in the Agreement. The Agreement was filed as Exhibit 75 to tyntec's Statement of Uncontested Facts in Support of Its Motion for Summary Judgment, dated June 1, 2018, at Doc. 117, and as Exhibit 75 to Doc. 236, which were documents delivered to Magistrate Judge Flynn at his direction (see Doc. 233). The second document requests that the Court continue to seal is the Levitt Deposition Transcript for the reasons identified in the Declaration of Erik Levitt, submitted concurrently herewith. The transcript had been submitted in its entirety as Exhibit 34 to tyntec's Motion for Summary Judgment, dated June 1, 2018, at Doc. 116; Exhibit 30 to tyntec's Statement of Uncontested Facts in Support of Its Motion for Summary Judgment, dated June 1, 2018, at Doc. 117; Exhibit 12 to tyntec's Motion to Exclude the Testimony of Dr. Mohan Rao, dated June 1, 2018, at Doc. 118; Exhibit 112 to Syniverse's Statement of Undisputed Material Facts, dated June 1, 2018, at Doc. 120; and as Exhibit 30 to Doc. 236, which were documents delivered to Magistrate Judge Flynn at his direction (see Doc. 233). Furthermore, confidential excerpts from the Levitt 3 1 PageID 27668 Deposition Transcript had been submitted as Exhibit S to Syniverse's Motion to Exclude Testimony of tyntec's Expert, dated June 1, 2018, at Doc. 121. IV. FILING THESE ITEMS WERE NECESSARY Both of the items tyntec seeks to seal were filed by tyntec and/or Defendant Syniverse Technologies, LLC ("Syniverse") as part of their summary judgment and/or Daubert motions. The information contained in these documents supports the arguments made and positions taken by the parties in motion practice, and were submitted in furtherance of the Court's reaching a decision on the merits. V. THE CONTINUED SEALING OF THESE ITEMS ARE NECESSARY The confidentiality clause included in the Agreement prohibits the disclosure of confidential "information that relates to the existence of th[e] Agreement, to the rights and obligations under th[e] Agreement, the negotiations relating to th[e] Agreement or to the Disclosing Party's or third party's business, financial or other affair, including possible future plans and targets." Xi Decl., ¶ 3. The Agreement further prohibits tyntec from disclosing the existence and terms of the Agreement without the prior written consent of the other party to the Agreement. Id. Although counsel for tyntec has notified counsel for the other party to the Agreement of the Order to show cause and sought its consent to unseal the Agreement, tyntec's customer has yet to provide a response to tyntec's inquiry. Id. at ¶ 4. Accordingly, in keeping with tyntec's contractual obligation to treat the confidential information belonging to the third party "with the same degree of care that [tyntec] uses for its own confidential information," id. at ¶ 3, and in an abundance of caution, tyntec requests that the Court continue to seal the Agreement for the duration of this lawsuit and during the pendency of any appeal, or until such time as tyntec's customer has had a chance to either contest or consent to the unsealing of the Agreement. 4 1 PageID 27669 As Mr. Levitt attests, his deposition testimony reveals certain sensitive and competitive information regarding Shelcomm's suppliers, customers, and business that could be damaging to Shelcomm's business if such information were to be made public. Levitt Decl., ¶ 5. The information given in the deposition includes not only non-public identities and details regarding Shelcomm's suppliers and customers, but also reveals the nature of Shelcomm's business, including Shelcomm's initiatives and efforts to gain and maintain a competitive edge as an operator in its industry. Id. at ¶ 6. If such information were made public—or, perhaps more importantly, made accessible by Shelcomm's competitors, such as Defendant Syniverse Technologies, LLC ("Syniverse")—there would be harm to the competitive position of Shelcomm. Id. at ¶¶ 8-9. According to Mr. Levitt, the risk of harm to Shelcomm is not merely hypothetical, but actual, due to Syniverse's history and "practice of taking anticompetitive and retaliatory action against Shelcomm" when Syniverse had previously gained even cursory awareness of Shelcomm's business transactions. Id. at ¶ 9. By the terms of their contract, because tyntec owes Shelcomm a duty to protect and cooperate in the protection of the confidential information of Shelcomm, Xi Decl., ¶ 6, tyntec requests that the Court continue to seal the Levitt Deposition Transcript for the duration of this lawsuit and during the pendency of any appeal. See Pledger v. Reliance Tr. Co., o. 1:14-cv-4444, 2019 U.S. Dist. LEXIS 45668, at *56 (N.D. Ga. Feb. 25, 2019) (granting motion to seal "financial information, client names"). tyntec submits that because the parties with interests against the public disclosure of their sensitive information are third parties to the underlying litigation, their interests are all the more compelling to warrant the sealing of the requested documents. Courts have held that sensitive business information such as this warrants protective treatment in judicial proceedings. See, e.g., Howard v. Hartford Life & Accident Ins. Co., 275 F.R.D. 649, 652 (M.D. Fla. 2011) (granting a 5 1 PageID 27670 protective order re documents that contained defendant's "practices and procedures that would be of value to its competitors"). VI. NO MEANS OTHER THAN SEALING IS SATISFACTORY Continued sealing of the two documents that are the subject of this motion is the only reasonable method of preserving their confidentiality while preventing the risk of harm that their public disclosure would create. See United States ex rel. Greg Westfall v. Axiom Worldwide, Inc., No. 8:06-cv-571, 2008 U.S. Dist. LEXIS 104725, at *12 (M.D. Fla. Dec. 19, 2008). Given the circumstances, there is no less onerous alternative. With respect to the Agreement, no means other than sealing is available or satisfactory to preserve the interest advanced by tyntec in support of the seal because the unsealing of the Agreement, without the written consent of tyntec's customer, would force tyntec to violate tyntec's duty of confidentiality under the terms of the Agreement. See Mars, Inc. v. JCM Am. Corp., Civ. No. 05-3165, 2007 U.S. Dist. LEXIS 9819, at *6-7 (D.N.J. Feb. 13, 2007) (finding a party had "a legitimate private interest in keeping confidential the terms of a confidential business agreement not otherwise available to the public"). Once released to the public, the information cannot be retracted, and the potential damage that it would cause tytec's customer, the party to the Agreement and a third party to this lawsuit, cannot be reversed. With respect to the Levitt Deposition Transcript, if unsealed, the public disclosure of the sensitive business information of Shelcomm would irreparably harm Shelcomm's business position, commercial interests, and competitive advantage. See Levitt Decl., ¶¶ 6-9. Because the Levitt Deposition Transcript is rife with testimony regarding details concerning Shelcomm's business and confidential suppliers and customers, any means other than sealing is unsatisfactory to preserve the interests of Shelcomm to keep such information confidential and out of the hands 6 1 PageID 27671 of Syniverse. Levitt Decl., ¶ 9. In fact, given the nature of the questions and the extent of the testimony, a majority of the transcript contains information Shelcomm deems confidential and which would need to be redacted, if the Court is not inclined to allow the continued sealing of the entire transcript. Indeed, redaction of the deposition transcript would be impractical because a significant portion of the document would be redacted and what is left would not be meaningful to the public. Accordingly, the Levitt Deposition Transcript should be sealed in its entirety to best preserve the interest advanced by Shelcomm. In the alternative, if the Court finds that redaction would sufficiently protect Shelcomm's interests while also allowing the public meaningful access, then tyntec requests seven (7) days to submit the exhibits in redacted form. See TMH Med. Servs., LLC v. Nat'l Union Fire Ins. Co. of Pittsburg, PA, No. 617CV920ORL37DCI, 2018 WL 1918262, at *1 (M.D. Fla. Jan. 17, 2018). VII. PROPOSED DURATION OF THE SEAL The documents that tyntec seeks to protect contain the type of information that warrant the exercise of the Court's discretion for at least one year, or for the duration of this lawsuit and during the pendency of any appeal, whichever is less. After the one year mark, should the parties whose confidential business information are at stake require an extension of the sealing order, they are free to move for an order to renew the seal that complies with LR 1.09(b). In the alternative, given that the parties' interests in keeping the sealed information confidential may survive beyond one year, tyntec requests that the sealed material be returned to tyntec and/or to Shelcomm, or destroyed when the sealing order expires. VIII. LEGAL ARGUMENTS THAT SUPPORT CONTINUED SEALING In evaluating a motion to seal, courts balance a party's interest in keeping the information confidential against the public interest in accessing court documents. See Romero, 480 F.3d at 7 1 PageID 27672 1246; Chicago Tribune, 263 F.3d at 1314-15. Courts consider whether allowing access would impair court functions or harm legitimate privacy interests, the degree 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, 480 F.3d at 1246; Medai, Inc. v. Quantros, Inc., No. 6:12-cv-840, 2012 U.S. Dist. LEXIS 90318, at *4-5 (M.D. Fla. June 29, 2012). The Eleventh Circuit has recognized that "[a] party's privacy or proprietary interest in information sometimes overcomes the interest of the public in accessing the information." Romero, 480 F.3d at 1246. Here, both third parties' interests in maintaining the confidentiality of their sensitive business information should be accorded significant weight because they are not parties to the underlying litigation. As this Court has held, the privacy interests of third parties who were "not involved in this dispute weigh[] heavily in the Court's balancing" of interests when determining whether good cause exists to grant protective treatment. Luzzi v. ATP Tour, Inc., No. 09cv1155, 211 U.S. Dist. LEXIS 74796, at *9-10 (M.D. Fla. July 12, 2011). The reason for this is obvious: as non-parties, neither Shelcomm nor the party to the Agreement produced the testimony or document at issue to further their own litigation interests. Thus, if their confidential business information is revealed and made public as a result of this litigation, they would be casualties to the tyntec-Syniverse dispute. Accordingly, the critical assumption behind the public access doctrine—that a party should voluntarily forego the confidentiality of its information when it "submits material for dispute resolution in a judicial forum"—is not present here. See Chicago Tribune, 263 F.3d at 1315 n.15 (finding that the assumption of voluntary disclosure behind the 8 1 PageID 27673 public access doctrine is not warranted "where one's adversary submits the presumptively confidential material"). Because each of the two documents contains the confidential business information of a non-party that was only tangentially relevant to the tyntec-Syniverse dispute, the Court should protect the confidentiality interests of these non-parties and prevent the disclosure of such information to the public, which would include direct and interested competitors such as Defendant Syniverse itself. Here, the legitimate confidentiality interests of the third parties outweigh the interest of the public in accessing the confidential and sensitive materials for this reason, and for the reason that their disclosure would create the risk of harm to each of these third parties. For example, as Mr. Levitt attests, the public disclosure of the highly competitive information revealed in his deposition testimony is likely to subject Shelcomm to "anticompetitive and retaliatory action" by Syniverse, which would "interfere with Shelcomm's ability to conduct its business." Levitt Decl., ¶ 9. Furthermore, the fact that the information that is subject to this motion to seal pertains to private business and does not implicate any issues of public concern additionally militates in favor of the Court's granting the requested relief. CONCLUSION For the reasons set forth above, tyntec respectfully requests that the Court enter an order continuing to seal the exhibits filed on the docket that are associated with the Agreement and the Levitt Deposition Transcript, designated above. CERTIFICATION PURSUANT TO LOCAL RULE 3.01(g) Pursuant to Local Rule 3.01(g), the undersigned certifies that counsel for tyntec has conferred with Syniverse's counsel concerning the substance of this motion, and is authorized to represent that Syniverse's counsel does not oppose the filing of this motion. 9 1 PageID 27674 Dated: September 27, 2019 Respectfully submitted, SUSMAN GODFREY L.L.P. By: /s / Meng Xi William Christopher Carmody Shawn J. Rabin Jason C. Bertoldi 1301 Avenue of the Americas, 32nd Floor New York, NY 10019 (212) 336-8330 bcarmody@susmangodfrey.com srabin@susmangodfrey.com jbertoldi@susmangodfrey.com Vineet Bhatia 1000 Louisiana, Suite 5100 Houston, TX 77002 (713) 651-9366 vbhatia@susmangodfrey.com Amanda Bonn Meng Xi 1900 Avenue of the Stars, Suite 1400 Los Angeles, CA 90067 (310) 789-3100 abonn@susmangodfrey.com mxi@susmangodfrey.com GUNSTER, YOAKLEY & STEWART, P.A. Daniel P. Dietrich Florida Bar No. 934461 401 East Jackson Street, Suite 2500 Tampa, FL 33602 (813) 739-6970 ddietrich@gunster.com MAYER BROWN LLP Stephen M. Medlock 1999 K Street, N.W. Washington, D.C. 20006 (202) 263-3000 smedlock@mayerbrown.com Attorneys for Plaintiffs 10 1 PageID 27675 CERTIFICATE OF SERVICE I hereby certify this 27th day of September, 2019, I electronically filed the foregoing with the Clerk of Court for the United States District Court for the Middle District of Florida by using the CM/ECF system which will send a notice of electronic filing to all CM/ECF registered parties. /s / Meng Xi Meng Xi 11