Opinion

Compass, Inc. v. Real Estate Board of New York, Inc.

Court
District Court, S.D. New York
Filed
Nov 15, 2022
Cited by
0 cases
Authority
More cited than 27.5%

“[T]he decision as to access is one best left to the sound discretion of the trial court, a discretion to be exercised in light of the relevant facts and circumstances of the particular case.”

How later courts described this case

  • “[T]he decision as to access is one best left to the sound discretion of the trial court, a discretion to be exercised in light of the relevant facts and circumstances of the particular case.”

Written by the judges who cited it.

The opinion

Crowell

Crowell & Moring LLP

Eric Steve Fanchiang 3 Park Plaza

EFanchiang@crowell.com 20th Floor

(949) 798-1338 direct Irvine, CA 92614

LA Ag +1.949.263.8400 main

UNITED STATES DISTRICT JUDGE +1.949.263.8414 fax

November 4, 2022 Application GRANTED. For the reasons statec

Plaintiffs’ letter, the joint letter may be filed

The Honorable Lorna G. Schofield under seal. The Clerk of Court is respectfully

US, District Court for the Southern District of New York girected to close the gavels at Dkts. No. 68 an

Thurgood Marshall United States Courthouse 80.

40 Foley Square

New York, New York 10007 Dated: November 15, 2022

New York, New York

Re: Compass, Inc. and Compass RE NY, LLC v. Real Estate Board of New York — Case No. 1:21-

CV-02195-LGS | Request For Authorization to File Redacted Joint Letter

Dear Judge Schofield:

Pursuant to Rule I.D.3 of the Court’s Individual Rules and Procedures for Civil Cases, Plaintiffs

Compass, Inc. and Compass RE NY, LLC (“Compass”) respectfully request that the Court

authorize Compass to file its joint letter (the “Joint Letter”) with non-party NRT New York LLC

d/b/a The Corcoran Group (“Corcoran”) regarding Compass and Corcoran’s discovery dispute

with limited redactions under seal. Compass seeks to redact quotations from and discussions of a

confidential settlement agreement that the Court ordered Compass and Corcoran to submit under

seal. See ECF No. 77. Corcoran does not oppose this request.

In accordance with this Court’s Individual Rules, Compass will publicly file a version of the

Joint Letter with the proposed redactions and electronically file a sealed version of the Joint

Letter with the proposed redactions highlighted. Attached hereto as Appendix A 1s a list of all

parties and attorneys of record who should have access to the unredacted Joint Letter.

I. Relevant Background

Compass and Corcoran currently have a dispute regarding whether Corcoran should produce

documents in response to Request Nos. 4-8 and 18-20 of Compass’s Subpoena to Produce

Documents (collectively, the “Subpoena”). See ECF No. 68. Part of Corcoran’s argument as to

why it should not produce documents relates to a confidential settlement agreement Compass

and Corcoran! entered into on September 28, 2022. See ECF No. 77 at 2-3. Compass and

Corcoran submitted the discovery dispute to the Court, and the Court ordered that they meet and

confer further and submit a joint letter outlining their remaining disputed issues on November 4,

2022. See id. at 4; ECF No. 79. The Court also ordered that when Compass and Corcoran

submit the Joint Letter, they submit the relevant settlement agreement via e-mail and under seal.

ECF No. 77 at 4. Compass now asks the Court that, in addition to filing the settlement

' The settlement agreement was entered into by Corcoran and other related corporate family members, as defined in

the settlement agreement.

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agreement under seal, Compass be further allowed to file the Joint Letter with quotations from

and references to the content of the confidential settlement agreement redacted.

II. Legal Standard

Under appropriate circumstances, a Court may enter an order sealing all or a portion of a

proceeding. See, e.g., Church Ins. Co. v. Ace Prop. & Cas. Ins. Co., No. 10-cv-698, 2010 WL

3958791, at *2-3 (S.D.N.Y. Sept. 23, 2010); Glob. Reinsurance Corp.-U.S. Branch v. Argonaut

Ins. Co., No. 07-cv-8196, 2008 WL 1805459, at *1-2 (S.D.N.Y. Apr. 24, 2008), as amended

(Apr. 24, 2008). Although “[t]he common law right of public access to judicial documents is

firmly rooted in our nation’s history,” this right is not absolute, and courts “must balance

competing considerations against” the presumption of access. Lugosch v. Pyramid Co. of

Onondaga, 435 F.3d 110, 119-20 (2d Cir. 2006) (internal quotation marks omitted); see also

Nixon v. Warner Commce’ns, Inc., 435 U.S. 589, 599 (1978) (“[T]he decision as to access is one

best left to the sound discretion of the trial court, a discretion to be exercised in light of the

relevant facts and circumstances of the particular case.”). As a result, Federal Rule of Civil

Procedure 26(c)(1)(G) allows confidential “commercial information” to be protected from public

access.

“Courts can seal ‘business information that might harm a litigant’s competitive standing’ in the

market.” New York v. Actavis, PLC, No. 14 Civ. 7473, 2014 WL 5353774, at *3 (S.D.N.Y. Oct.

21, 2014) (quoting /n re Parmalat Sec. Litig., 258 F.R.D. 236, 244 (S.D.N.Y. 2009)). Depending

on the facts of a case, a party’s “assertion that its competitors who do not now have this

information could use it to do competitive injury” can be “a sufficient basis to grant the [party’s]

motion to seal,” even if the information the party “desires to keep confidential [is] not ‘trade

secrets’ in the traditional sense.” Gelb v. Am. Tel. & Tel. Co., 813 F. Supp. 1022, 1035

(S.D.N.Y. 1993). The key is the information’s “potential to do commercial harm,” as well as

whether the information was “arguably a part of” an adverse party’s “efforts to gain competitive

advantage.” /d. A party, for example, “has a plain privacy interest in maintaining the

confidentiality of its settlement terms” that militates against “disclosure of the agreement” when

it “would be highly detrimental to that interest.” Ciccotelli v. Deutsche Bank AG, No. 2:15-CV-

105, 2016 WL 2588169, at *9 (D. Vt. May 4, 2016), aff'd, 701 F. App’x 67 (2d Cir. 2017).

III. Redaction of Compass and Corcoran’s Settlement Agreement Provisions Is

Warranted

Filing the Joint Letter with redacted quotations from and references to the content of the relevant

settlement agreement is necessary to prevent the unauthorized dissemination of confidential

business information, as “the disclosing company is engaged in a highly competitive industry

and deliberately has shielded such information from its competitors.” New York, 2014 WL

5353774, at *3. Specifically, Compass seeks to preserve as confidential limited discussions of

contractual provisions included the confidential settlement agreement, the disclosure of which

would detrimentally harm Compass’s business in the competitive New York real estate

brokerage market. Compass and Corcoran have “deliberately . . . shielded” the terms of the

settlement agreement from their competitors and request that the Court extend said shield to the

Joint Letter. New York, 2014 WL 5353774, at *3. The Court has already ordered the settlement

agreement be filed under seal, see, e.g., ECF No. 77 at 4, and redacting discussions of the

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settlement agreement in the Joint Letter is consistent with the Court’s direction that the

settlement agreement itself be filed under seal.

Compass’s interest in keeping this limited amount of commercial information confidential

significantly outweighs any interest in public access to such information, as the settlement

agreement was a confidential settlement between Compass and Corcoran. Additionally, aside

from the present discovery dispute, the terms of the settlement agreement between Compass and

non-party Corcoran do not impact the present action before the Court, so it is not the sort of

judicial document that has a presumption of access. See, e.g., Lugosch, 435 F.3d at 119-20.

Compass’s privacy interest is further sufficient because the settlement agreement was between

Compass and Corcoran who “is not a party to the present suit.” Ciccotelli, 2016 WL 2588169,

at *9,

IV. Requested Relief

For these reasons, Compass respectfully requests that the Court authorize Compass to file its

Joint Letter with Corcoran with quotations from or references to the contents of the relevant

settlement agreement redacted.

Respectfully submitted,

/s/ Eric Fanchiang

Chahira Solh (pro hac vice)

Marlee Santos (Bar No. 5570593)

Eric Fanchiang (pro hac vice)

CROWELL & MORING LLP

3 Park Plaza, 20th Floor

Irvine, CA 92614

(949) 263-8400

csolh@crowell.com

msantos@crowell.com

efanchiang@crowell.com

Glen G. McGorty

CROWELL & MORING LLP

590 Madison Ave, 20th Floor

New York, New York 10022

(212) 223-4000

gmcgorty@crowell.com

Attorneys for Plaintiffs

Compass, Inc. and Compass RE NY, LLC

ce: All Counsel of Record (via ECF); Counsel for Corcoran (via ECF and email)

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Appendix A

The following parties and attorneys of record should have access to the unredacted joint

letter:

Counsel for Plaintiffs Compass, Inc. and Compass RE NY, LLC

Chahira Solh

Glen McGorty

Marlee Santos

Eric Fanchiang

Non-Party NRT New York LLC d/b/a The Corcoran Group

Nicholas Sarokhanian

Robert J. Burns

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.

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