CHAD RUSKEY VS JORDAN HAMBURGER, ET AL.

Tentative Rulings

Case Number: 19STCV26405    Hearing Date: December 23, 2019    Dept: 47

Chad Ruskey v. Jordan Hamburger, et al.

MOTION TO COMPEL BINDING ARBITRATION AND STAY ACTION

(CCP ; 1281.2)

MOVING PARTY: Defendant Manatt, Phelps & Phillips, LLP

RESPONDING PARTY(S): Plaintiff Chad Ruskey

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

This is a legal malpractice action. Plaintiff alleges that Defendants represented him and BrandRep, LLC in the sale of BrandRep, LLC to BrandRep Holdings, LLC. He alleges that Defendants never asked him to sign a conflict waiver or suggested they were acting in a capacity adverse to him, but he is now being sued by BrandRep, BrandRep Holdings, and others as a result of Defendants’ malpractice.

Defendant Manatt, Phelps & Phillips, LLP moves to compel arbitration and stay the action. Defendant Jordan Hamburger filed a joinder to the motion.

TENTATIVE RULING:

Defendant Manatt, Phelps & Phillips, LLP’s motion to compel arbitration and stay the action is GRANTED.

Defendant Jordan Hamburger’s joinder is GRANTED.

The action is stayed pending conclusion of the arbitration.

Any and all future dates are advanced and vacated. A Status Conference/OSC re: Dismissal is set for December 23, 2020 at 8:30 a.m. If there are no appearances and/or the parties have not completed the arbitration without good cause, this case may be dismissed.

DISCUSSION:

Motion To Compel Arbitration

1. Existence of Arbitration Agreement

Under California law, arbitration agreements are valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract. (Blake v. Ecker (2001) 93 Cal.App.4th 728, 741 (overruled on other grounds by Le Francois v. Goel (2005) 35 Cal.4th 1094).) A party petitioning to compel arbitration has the burden of establishing the existence of a valid agreement to arbitrate, and the party opposing the petition has the burden of proving, by a preponderance of the evidence, any fact necessary to its defense. (Banner Entertainment, Inc. v. Superior Court (1998) 62 Cal.App.4th 348, 356-57.)

Defendant seeks to compel arbitration based upon an arbitration provision in a retainer agreement, which states that “both you and we agree to be bound by the Arbitration Provision attached hereto as Schedule A and incorporated herein by this reference.” (Declaration of Ben D. Orlanski, Exh. G, at p. 5.) Schedule A provides, in relevant part:

By signing this letter, you agree that, in the event of any dispute arising out of or relating to this agreement, our relationship, or the services performed (including, but not limited to, disputes alleging negligence, breach of fiduciary duty, fraud, or any claim based upon a statute), such disputes shall be resolved by submission to binding arbitration in Orange County, California . . . .

* * *

Notwithstanding the foregoing, in the event a dispute arises between us relating to the amount or payment of our fees, you have the right to request nonbinding arbitration of such fee dispute under the procedures provided in Sections 6200-6206 of the California Business & Professions Code, as opposed to the procedures described in this letter. . . . Any other claims or disputes between us, including claims for professional negligence, shall remain subject to the binding arbitration procedures as provided in this letter.

(Orlanski Decl., Exh. G, at pp. 9-10 (Schedule A).)

Plaintiff does not deny that this agreement exists, but he argues he is not bound by it because he is not a party to it. It is signed by Benir Ganatra, CEO of BrandRep, Inc., and “you” in the agreement refers to BrandRep, Inc. (Orlanski Decl., Exh. G, at p. 1 [“Manett, Phelps & Phillips, LLP (‘we’ or ‘us’) will represent and advise BrandRep, Inc. (‘you’) in connection with a potential sale of the company.”].) The agreement is signed “BrandRep, Inc. By: Banir Ganatra Its: Chief Executive Officer.” (Orlanski Decl., Exh. G, at p. 8.) Plaintiff alleges in his complaint that he was the Chief Technology Officer of BrandRep at the time of the sale and owned 40% of the company. (Complaint ¶ 11.)

Defendant acknowledges that Plaintiff did not sign this agreement but argues that Plaintiff is bound by it under the principles of (1) equitable estoppel and (2) third-party beneficiary. Although California law and federal law appear to be consistent in their application of these doctrines in the arbitration context, both parties cite both federal cases and California cases (applying both California law and federal law) in support of their arguments, and Defendant cites California procedural law as the basis for its motion, it may be helpful as a threshold matter to determine whether the FAA applies to the arbitration agreement at issue.

1. Applicability of the FAA

Defendant primarily bases its arguments on California law, but it also argues that the FAA governs the parties’ arbitration agreement because it involves interstate commerce.

The parties’ agreement makes no mention of the FAA. Indeed, to the extent that it refers to any jurisdiction’s law, it indicates that the “arbitrator shall apply and follow California law.” (Orlanski Decl., Exh. G, at p. 9.) Yet Defendant argues that the FAA governs because the “subject matter of the dispute involves interstate commerce.” (Motion, at p. 9.)

An arbitration clause is governed by the FAA if the agreement is a contract “evidencing a transaction involving commerce.” (9 U.S.C. ; 2.) Courts “broadly construe” this phrase, because the FAA “embodies Congress’ intent to provide for the enforcement of arbitration agreements within the full reach of the Commerce Clause.” (Giuliano v. Inland Empire Pers., Inc. (2007) 149 Cal.App.4th 1276, 1286.)

Here, the transaction evidenced in the retainer agreement – Defendant’s representation of BrandRep (at a minimum) in connection with its potential sale – involved commerce. Defendant is a national law firm, BrandRep did business in interstate commerce, its buyer was located in Florida, and counsel for the buyer and seller were located in Ohio and California. (Hamburger Decl. ¶ 4; Orlanski Decl. ¶¶ 2, 10; Exhs. G, H.) Based on this evidence, Defendant has met its “burden to demonstrate FAA coverage by declarations and other evidence.” (Hoover v. American Income Life Ins. Co. (2012) 206 Cal.App.4th 1193, 1207.)

Plaintiff argues that the FAA’s procedural rules do not apply here, and that is true. Even when the FAA applies to an arbitration agreement, when the parties also intended to apply California law, California’s procedural rules are not preempted. (Cronus Investments, Inc. v. Concierge Services (2005) 35 Cal.4th 376, 383, 388-390, 394; Mastick v. TD Ameritrade, Inc. (2012) 209 Cal.App.4th 1258, 1263-1264; Volt Information Sciences, Inc. v. Board of Trustees of Leland Stanford Junior Univ. (2005) 489 U.S. 468, 477-479.) Here, the agreement indicates the parties’ intent for it to be governed by California law. Under those circumstances, California procedural law applies. (See Los Angeles Unified School Dist. v. Safety Nat’l Cas. Corp. (2017) 13 Cal.App.5th 471, 475-476 [holding that California procedural laws “apply in California courts by default” when an arbitration agreement is silent as to whether FAA or California procedural rules govern].) Indeed, Defendants invoke CCP ; 1281.2 as the basis for their motion to compel arbitration. Nevertheless, as discussed here, the FAA’s substantive provisions do apply to agreements that evidence a transaction involving commerce, even when the FAA is not mentioned in the agreement.

Having concluded that the FAA’s substantive provisions govern the parties’ agreement, the Court now considers whether the arbitration agreement binds Plaintiff, a nonsignatory to the agreement.

1. Whether the Arbitration Agreement Binds Plaintiff

As noted above, Defendant argues that Plaintiff is bound by the existing arbitration agreement, despite not signing it himself, under the principles of (1) equitable estoppel and (2) third-party beneficiary.

Equitable Estoppel

In general, “one must be a party to an arbitration agreement to be bound by it.” (Molecular Analytical Systems v. Ciphergen Biosystems, Inc. (2010) 186 Cal.App.4th 696, 706.) An exception to this general rule, however, is “based on the doctrine of equitable estoppel.” (Ibid.) The application of this concept in the arbitration context “developed under federal arbitration law” but “applies with equal force under California law.” (Id. at 714.) Thus, the Court will look to both federal and California cases for guidance on this issue.

Although many of the equitable estoppel cases in the arbitration context – including Molecular Analytical Systems, cited above – involve a nonsignatory attempting to compel a signatory to arbitrate, the reverse is also supported by the case law: a nonsignatory may be compelled to arbitrate by a signatory under the doctrine. (Jensen v. U-Haul Co. of California (2017) 18 Cal.App.5th 295, 306.) Specifically, a “nonsignatory plaintiff may be estopped from refusing to arbitrate when he or she asserts claims that are ‘dependent upon, or inextricably intertwined with’ the underlying contractual obligations of the agreement containing the arbitration clause.” (Ibid.)

“The focus is on the nature of the claims asserted .... That the claims are cast in tort rather than contract does not avoid the arbitration clause.” . . . Rather, “‘[t]he plaintiff’s actual dependence on the underlying contract in making out the claim against the nonsignatory ... is ... always the sine qua non of an appropriate situation for applying equitable estoppel.’” . . . “[E]ven if a plaintiff’s claims ‘touch matters’ relating to the arbitration agreement, ‘the claims are not arbitrable unless the plaintiff relies on the agreement to establish its cause of action.’” . . . “The fundamental point” is that a party is “not entitled to make use of [a contract containing an arbitration clause] as long as it worked to [his or] her advantage, then attempt to avoid its application in defining the forum in which [his or] her dispute ... should be resolved.”

(Ibid. (emphasis in original; citations omitted.) In Jensen, the plaintiffs’ claims were not inextricably intertwined with the underlying contractual obligations, because “none of their allegations” were “in any way founded in or bound up with the terms or obligations of that agreement.” (Ibid.)

Here, Plaintiff’s claims are inextricably intertwined with the retainer agreement pursuant to which Defendant offered its services in connection with the sale of BrandRep. Plaintiff’s claims are based on Defendant’s representation of BrandRep in its sale to BrandRep Holdings, LLC. (Complaint ¶ 9.) Plaintiff alleges that Defendant breached its duty to him and to BrandRep in connection with that sale. (Id. ¶¶ 39, 41, 50.) The retainer agreement sets out Defendant’s obligations as to its services offered in connection with the sale of BrandRep. (Orlanski Decl., Exh. G, p. 1.) Thus, Plaintiff’s claims of legal malpractice and breach of fiduciary duty are dependent upon the agreement by which Defendant involved itself in the sale in the first place.

Plaintiff argues that his claims are not inextricably intertwined with the retainer agreement because he alleges that he had an oral agreement with Defendants to represent him apart from their representation of BrandRep. However, the retainer agreement itself states that Defendant “will not be deemed to represent the interests of any of [BrandRep’s] . . . officers, directors, partners, principals, investors or employees, unless otherwise agreed to in writing.” (Orlanski Decl., Exh. G, at p. 1.) Thus, potential representation of BrandRep’s “officers, directors, partners, principals, investors or employees” is expressly contemplated by the agreement, and to the extent that Plaintiff alleges that he had a separate agreement to represent him, that allegation is intertwined with Defendant’s representation of his former company.

Third-Party Beneficiary

Having concluded that Plaintiff may be compelled to arbitrate based on equitable estoppel, it is unnecessary to reach Defendant’s alternative argument that Defendant may be compelled to arbitrate as a third-party beneficiary of the retainer agreement. Nevertheless, the third-party beneficiary doctrine would also dictate that Plaintiff must arbitrate this dispute. Indeed, the equitable estoppel analysis and the third-party-beneficiary analysis are “ultimately nearly identical.” (JSM Tuscany, LLC v. Superior Court (2011) 193 Cal.App.4th 1222, 1240 n.20.)

Here, as the owner of 40% equity in BrandRep, Plaintiff received almost $11 million from its sale. (Hamburger Decl. ¶ 5.) As one of the two owners of BrandRep, the contracting parties “procured this benefit for him” and his co-owner, making them third-party beneficiaries of the agreement. (Harris v. Superior Court (1986) 188 Cal.App.3d 475, 479.) As a third-party beneficiary of the retainer agreement, Plaintiff “can gain no greater rights under than contract than the contracting parties.” (Ibid.)

Accordingly, the Defendant has met its burden of showing by a preponderance of the evidence the existence of an arbitration agreement that binds Plaintiff. The question remains, however, which of Plaintiff’s claims are subject to arbitration and whether it is otherwise enforceable.

1. Claims To Be Arbitrated

Plaintiff alleges causes of action for legal malpractice and breach of fiduciary duty.

As discussed above, the arbitration agreement provides as follows:

By signing this letter, you agree that, in the event of any dispute arising out of or relating to this agreement, our relationship, or the services performed (including, but not limited to, disputes alleging negligence, breach of fiduciary duty, fraud, or any claim based upon a statute), such disputes shall be resolved by submission to binding arbitration in Orange County, California . . . .

* * *

Notwithstanding the foregoing, in the event a dispute arises between us relating to the amount or payment of our fees, you have the right to request nonbinding arbitration of such fee dispute under the procedures provided in Sections 6200-6206 of the California Business & Professions Code, as opposed to the procedures described in this letter. . . . Any other claims or disputes between us, including claims for professional negligence, shall remain subject to the binding arbitration procedures as provided in this letter.

(Orlanski Decl., Exh. G, at pp. 9-10 (Schedule A) (bold emphasis added).)

Thus, Plaintiff’s causes of action are among those specifically mentioned in the agreement, which also contains language that courts have interpreted broadly: “arising out of or relating to.” (See, e.g., Ramos v. Superior Court (2018) 28 Cal.App.5th 1042, 1052 [noting that arbitration agreements using the phrase “arising under or related to” have been construed broadly and that, “for a party’s claims to come within the scope of such a clause, the factual allegations of the complaint ‘need only “touch matters” covered by the contract containing the arbitration clause”].] Based on the contractual language, which not only includes the broadly construed phrase “arising out of or relating to” but also specifically Plaintiff’s causes of action, all causes of action asserted by Plaintiff fall within the scope of the agreement.

The remaining question, then, is whether the agreement is enforceable or, alternatively, whether there is any justification for continuing this motion.

1. Other Arguments Against Enforcement

Plaintiff does not argue that the agreement is unconscionable. Accordingly, the Court need not address this defense to enforcement of the agreement. (Heglin v. F.C.B.A. Market (1945) 70 Cal.App.2d 803, 805-806.)

Plaintiff does request that this motion be continued to allow him to file an amended complaint. Plaintiff has not cited to any authority justifying that request in the context of a motion to compel arbitration. Plaintiff could have sought permission to file an amended complaint at any time while this motion was pending or before. Having failed to do so, there is no basis on which to delay consideration of a timely motion.

Plaintiff also argues that the Court should not compel arbitration here because the exception in CCP ; 1281.2(c) applies. That provision states that the Court is not required to compel arbitration if a “party to the arbitration agreement is also a party to a pending court action or special proceeding with a third party, arising out of the same transaction or series of related transactions and there is a possibility of conflicting rulings on a common issue of law or fact.” (CCP ; 1281.2(c).) Plaintiff argues that there is a potential for inconsistent rulings between any arbitration of his claims against the moving Defendant and his litigation against Defendant Hamburger.

As discussed in connection with Defendant Hamburger’s request for joinder, however, it is appropriate to compel Plaintiff’s claims against Defendant Hamburger to arbitration with his claims against the moving Defendant. As an agent of the moving Defendant at all relevant times, Defendant Hamburger may enforce the arbitration agreement. (Dryer v. Los Angeles Rams (1985) 40 Cal.3d 406, 418.)

Accordingly, Defendant’s motion to compel arbitration is GRANTED.

The action is stayed pending conclusion of the arbitration.

Any and all future dates are advanced and vacated. A Status Conference/OSC re: Dismissal is set for December 23, 2020 at 8:30 a.m. If there are no appearances and/or the parties have not completed the arbitration without good cause, this case may be dismissed.

Defendant Jordan Hamburger’s Joinder

A notice of joinder must be served pursuant to the same notice requirements as the motion in which the joinder is made. (See Lerma v. County of Orange (2004) 120 Cal.App.4th 709, 718-719.)

Here, Defendant Jordan Hamburger’s amended notice of joinder was served by overnight mail on November 25, 2019, and thus complies with the notice requirement set forth in CCP ; 1005(b) for service.

As to the motion itself, however, Defendant Hamburger is not similarly situated to the moving Defendant, and therefore he should have filed his own motion and incorporated the moving Defendant’s arguments by reference, as applicable. Defendant Hamburger is not a signatory to the arbitration agreement, and therefore he is seeking to compel a nonsignatory to arbitration as a nonsignatory himself. The moving Defendant’s arguments as a signatory compelling a nonsignatory to arbitration, therefore, only take him so far.

Nevertheless, Defendant Hamburger includes, in his amended notice of joinder, points and authorities establishing that a nonsignatory may also enforce an arbitration provision. Although most of those cases involve a nonsignatory enforcing an arbitration provision against a signatory, courts have compelled a nonsignatory to arbitration with another nonsignatory. (E.g., JSM Tuscany, supra, 193 Cal.App.4th at 1241 [“A nonsignatory plaintiff can be compelled to arbitrate even against a nonsignatory defendant, when the claim is itself based on, or inextricably intertwined with, the contract containing the arbitration clause.”].) The authorities cited by Defendant Hamburger likewise support the proposition that he can enforce the arbitration provision as an agent of the moving Defendant. (Dryer, supra, 40 Cal.3d at 418.)

Accordingly, the notice of joinder is GRANTED.

Moving party to give notice, unless waived.

IT IS SO ORDERED.

Dated: December 23, 2019 ___________________________________

Randolph M. Hammock

Judge of the Superior Court

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@lacourt.org

Case Number: 19STCV26405    Hearing Date: December 17, 2019    Dept: 47

Chad Ruskey v. Jordan Hamburger, et al.

APPLICATION FOR ORDER SEALING DOCUMENTS LODGED CONDITIONALLY UNDER SEAL IN SUPPORT OF MOTION TO COMPEL BINDING ARBITRATION

MOVING PARTY: Defendant Manatt, Phelps & Phillips, LLP

RESPONDING PARTY(S): Plaintiff Chad Ruskey

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

This is a legal malpractice action. Plaintiff alleges that Defendants represented him and BrandRep, LLC in the sale of BrandRep, LLC to BrandRep Holdings, LLC. He alleges that Defendants never asked him to sign a conflict waiver or suggested they were acting in a capacity adverse to him, but he is now being sued by BrandRep, BrandRep Holdings, and others as a result of Defendants’ malpractice.

Defendant Manatt, Phelps & Phillips, LLP moves to seal documents lodged conditionally under seal in support of its motion to compel binding arbitration.

TENTATIVE RULING:

Defendant Manatt, Phelps & Phillips, LLP’s application for order sealing documents lodged conditionally under seal in support of motion to compel binding arbitration is DENIED.

Defendant may formally withdraw any of the documents lodged conditionally under seal within 10 days of this ruling. (CRC Rule 2.551(b)(6).) If there is no such withdrawal within this time period, all such documents shall be “unsealed” and placed in the public record. If the documents are unsealed, this Court will review and consider them, as relevant, for purposes of the pending motion to compel arbitration.

Unless Defendant Manatt, Phelps & Phillips, LLP’s counsel states unequivocally at the hearing, as to its intention on whether they will either withdraw the documents at issue or not, then the motion to compel arbitration will need to be continued for at least 3 weeks, so that the 10 day period can expire.

Any documents that are timely and formally withdrawn by the lodging party will not be considered for purposes of the pending motion to compel arbitration.

DISCUSSION:

Motion To Seal

Defendant moves to seal documents that it submitted conditionally under seal in support of its motion to compel arbitration.

“Unless confidentiality is required by law, court records are presumed to be open.” (CRC 2.550.)

A motion seeking an order sealing the record must be accompanied by “a declaration containing facts sufficient to justify the sealing.” (CRC Rule 2.551(b)(1).) A court may order that a record be filed under seal “only if it expressly finds facts that establish” all of the following:

(1) There exists an overriding interest that overcomes the right of public access to the record;

(2) The overriding interest supports sealing the record;

(3) A substantial probability exists that the overriding interest will be prejudiced if the record is not sealed;

(4) The proposed sealing is narrowly tailored; and

(5) No less restrictive means exist to achieve the overriding interest.

(CRC 2.550(d).)

Here, the declarations submitted by Defendants do not satisfy this standard.

1. Whether there exists an overriding interest that overcomes the right of public access to the record.

Defendant cites attorney-client privilege (as to a third party), attorney work product (as to a third party), and the confidentiality of financial information contained in a document designated “confidential” as its overriding interests in preventing disclosure of its unredacted documents filed in support of its motion to compel arbitration. (Declaration of Corey E. Klein ¶¶ 3-9.)

Attorney-client privilege may be an overriding interest that overcomes the right of public access. (Huffy Corp. v. Superior Court (2003) 112 Cal.App.4th 97, 108 (dictum).) Likewise, one of the documents conditionally filed under seal is an engagement agreement, which is considered a “confidential communication.” (Bus. & Prof. Code ; 6149.) A “contractual agreement not to disclose” information may also “constitute an overriding interest” under this Rule. (Universal City Studios, Inc. v. Superior Court (2003) 110 Cal.App.4th 1273, 1283 [discussing Rule 243.1(d), the predecessor to Rule 2.550].)

Thus, Defendant has articulated overriding interests that potentially overcome the right to public access to these records. As discussed below, however, Defendant has not shown that these overriding interests overcome the right to public access to the extent that they support sealing the record.

1. Whether the overriding interest supports sealing the record.

The Declaration of Corey E. Klein does not articulate any specific facts that establish that the overriding interests discussed above support sealing the record. Attorney Klein vaguely refers only to sealing these documents “to avoid waiver and improper public disclosure.” (Klein Decl. ¶ 9.) This is not a sufficient evidentiary showing to overcome the presumed right of public access to the documents. (CRC Rule 2.550(c); Huffy, supra, 112 Cal.App.4th at 108.)

Accordingly, this requirement is not satisfied.

1. Whether a substantial probability exists that the overriding interest will be prejudiced if the record is not sealed.

Defendant has not presented admissible evidence that the overriding interest will be prejudiced if the record is not sealed. The Klein Declaration does not articulate any specific showing of serious injury to Defendant or a third party; nor that there is a substantial probability of such harm if the record is not sealed.

Defendant has not demonstrated any prejudice to its business interests if it is revealed the parties entered into the October 14, 1998, settlement agreement. No admissible evidence has been presented showing defendant will be harmed if the October 14, 1998, agreement or any of its nonfinancial terms are made public particularly in light of the 88 redactions which have deleted any reference to financial data. The fact the parties entered into the October 14, 1998, settlement agreement is a matter of public record. It is discussed in the complaint which is not sealed. It is discussed at length in the mandate petition filed in this case which is unsealed. Defendant has expressly indicated it is not seeking to seal its mandate petition. The mandate petition: refers 49 times to the October 14, 1998, arbitration and settlement agreement; by doing so, defendant identifies the parties to the agreement; explicitly states that a confidential arbitration has been going on before retired Superior Court Judge Eli Chernow since January 1999; on five different pages identifies the motion picture which gave rise to the dispute, “Private School”; explains Mr. Ben Efraim’s relationship to the dispute; and identifies a relative of Mr. Ben Efraim who has knowledge of some of the facts. Apart from the financial figures which have been redacted, the October 14, 1998 agreement is a routine settlement document. Defendant has presented no evidence that disclosure of any of the substantive provisions as distinguished from the redacted financial terms of the October 14, 1998, agreement will prejudice any legitimate confidential business practice. Finally, the arbitration which has been conducted in secret since January 1999, can continue out of the public eye.

To sum up, no substantial prejudice to the contractual obligation not to disclose has been proven. The heavily redacted October 14, 1998, agreement is not the same document presented to us. Defendant has failed to make any showing of prejudice to any of its legitimate commercial interests if the heavily redacted October 14, 1998, agreement is unsealed.

(Universal City Studios, Inc. v. Superior Court (2003) 110 Cal.App.4th 1273, 1284 (bold emphasis added).)

“In delineating the injury to be prevented, specificity is essential. [Citation.] Broad allegations of harm, bereft of specific examples or articulated reasoning, are insufficient.” (In re Cendant Corp., supra, 260 F.3d at p. 194.) We have been unable to find any appellate court decision which construes Publicker to permit sealing of court documents merely upon the agreement of the parties without a specific showing of serious injury. We therefore, with respect, reject defendant’s broad reading of the citation to Publicker in footnote 46 of NBC Subsidiary.

The Third Circuit analysis is consistent with the NBC Subsidiary holding. In NBC Subsidiary, the trial court ordered closure of proceedings where the jury was not present in order to protect the litigants’ fair trial rights. (NBC Subsidiary (KNBC-TV), Inc. v. Superior Court, supra, 20 Cal.4th at p. 1222.) The Supreme Court agreed that the protection of a fair trial right can be an overriding interest which would justify closure. However, the Supreme Court noted in NBC Subsidiary that the mere assertion of a fair trial cannot support a closure order. The Supreme Court held: “We believe that the trial court’s stated justification—protection of the underlying civil litigants’ right to a fair trial—is, in the abstract, an overriding interest, and that the First Amendment (and hence [Code of Civil Procedure] section 124) do, in an appropriate case, permit closure to protect that interest. The trial court, however, made no finding supporting the proposition that prejudice to that interest was substantially probable absent closure and temporary sealing.” (Ibid., italics & fns. omitted.) The first of the two omitted footnotes in the quoted portion from NBC Subsidiary in the immediately preceding sentence is footnote 46, which refers to Publicker and the right to closure or sealing in furtherance of the potential overriding interest of enforcement of a binding contractual obligation not to disclose. NBC Subsidiary (KNBC-TV), Inc. v. Superior Court, supra, 20 Cal.4th at p. 1222, fn. 46; see Publicker Industries, Inc. v. Cohen, supra, 733 F. 2d at p. 1073.) Nonetheless, once it is established there is a potential overriding interest, the party seeking closure or sealing must prove prejudice to that interest is substantially probable. (NBC Subsidiary (KNBC-TV), Inc. v. Superior Court, supra, 20 Cal.4th at p. 1222.)

(Universal City Studios, supra, 110 Cal.App.4th at 1280-1283 (bold emphasis and underlining added).)

This requirement is not satisfied.

1. Whether the proposed sealing is narrowly tailored.

The proposed sealing is narrowly tailored to include documents subject to a confidentiality agreement and confidential attorney-client communications. This requirement is met.

1. Whether any less restrictive means exists to achieve the overriding interest.

A less restrictive means to achieve the overriding interest would be to redact all information pertaining to anyone other than the Plaintiff. To present the arbitration language to which Plaintiff purportedly agreed, for example, Defendant should not need to present any facts pertaining to third parties. If it does, the least restrictive means to accomplish that would be to obtain the third parties’ permission to disclose that information for this narrow purpose and only to the extent necessary to demonstrate Plaintiff’s agreement to arbitrate.

In sum, Defendant has not demonstrated by way of its factual declarations that all of the CRC Rule 2.550(d) requirements for sealing have been met.

Accordingly, the motion to seal the record is DENIED.

Moving party to give notice, unless waived.

IT IS SO ORDERED.

Dated: December 17, 2019 ___________________________________

Randolph M. Hammock

Judge of the Superior Court

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@lacourt.org