United States District Court, D. Colorado
LOXO ONCOLOGY, INC., STEVEN ANDREWS, JOSHUA BALLARD, BARBARA BRANDHUBER, GABRIELLE KOLAKOWSKI, ELIZABETH MCFADDIN, MEGAN MCKENNEY, ANDREW METCALF, TONY MORALES, and SHANE WALLS, Plaintiffs/Counter Defendants,
v.
ARRAY BIOPHARMA INC., Defendant/Counter Claimant.
ORDER
PHILIP
A. BRIMMER CHIEF UNITED STATES DISTRICT JUDGE
This
matter is before the Court on Defendant and
Counterclaim-Plaintiff Array Biopharma Inc.'s
(“Array”) Motion to Redact Portions of the June
11, 2019 Hearing Transcript [Docket No. 175] filed on July
22, 2019. On August 12, 2019, Counterclaim Defendants
(collectively, “Loxo”) filed a response. Docket
No. 191-1. Array replied on August 23, 2019. Docket No. 194.
On June
11, 2019, the Court held a hearing on Array's motion for
a preliminary injunction. Docket No. 142. During the hearing,
the parties agreed to refer to Array's trade secrets
using generic names, such as “Trade Secret 1, ”
so as to avoid the risk of revealing any of Array's trade
secrets. Docket No. 148 at 3:21-4:12. Array now seeks to
redact twelve words of the preliminary injunction hearing
transcript on the basis that Loxo's failure to use those
code words has the effect of revealing the nature of
Array's trade secret programs. Docket No. 174-1 at 3.
Loxo opposes the motion, [1] essentially making two arguments:
first, that the information Array seeks to redact is public
information, and second, that the presumption of public
access outweighs Array's interest in protecting the
information for which it seeks redaction. Docket No. 191-1 at
1-2.
“There
is a presumption that judicial proceedings are public.”
Pfizer, Inc. v. Teva Pharmaceuticals USA, Inc., 2010
WL 2710566, at *3 (D.N.J. July 7, 2010). While this
presumption exists, documents may be restricted when the
public's right of access is outweighed by interests which
favor non-disclosure. See United States v. McVeigh,
119 F.3d 806, 811 (10th Cir. 1997). “The party seeking
to seal any part of a judicial record bears the burden of
demonstrating that ‘the material is the kind of
information that courts will protect.'” Valeant
Pharmaceuticals North America LLC v. Mylan Pharmaceuticals
Inc., 2019 WL 3843052, at *1 (D.N.J. Aug. 15, 2019)
(quoting Miller v. Indiana Hosp., 16 F.3d 549, 551
(3d Cir. 1994)). It is within the district court's
discretion to determine whether a particular court document
should be restricted. See Nixon v. Warner Communications,
Inc., 435 U.S. 589, 599 (1978).
Loxo
argues that Array's motion to redact the transcript
should be denied because the portions that Array seeks to
redact contain public information. Docket No. 191-1 at 1.
According to Loxo, because these statements - in which
Array's trade secrets were purportedly disclosed - were
made in conjunction with a discussion of a non-confidential
PowerPoint slide, the information that Array seeks to redact
“does not qualify as information that is
‘maintained confidentially' or ‘trade
secret' . . . and therefore does not warrant restriction
under” D.COLO.LCivR 7.2(c). Id. at 6.
The
Court disagrees. Array has met its burden of demonstrating
that redaction of the hearing transcript in this limited
manner is appropriate. First, the Court finds that Array
seeks to redact information that may reveal its trade
secrets. At the start of the hearing, the parties agreed to
refer to Array's trade secrets using generic names.
Despite this, when cross-examining Array's witnesses,
counsel for Loxo identified the specific protein inhibitors
or clinical candidates that are the subject of Array's
Trade Secrets 1 and 8(a). Had the generic names been used
throughout the hearing, redaction would not be necessary.
Docket No. 194 at 2.
During
the hearing, Dr. Nicholas Saccomano, Array's Chief
Scientific Officer, testified that the identity of
Array's programs was “proprietary” and
“confidential” to Array. Docket No. 148 at
17:24-18:1. He stated that the mere fact that Array had
identified the clinical candidates that are the subject of
its trade secrets was proprietary and confidential to Array,
id. at 18:19-22, and that the structures that are
discovered as part of Array's drug discovery process is
“highly proprietary and confidential”
information. Id. at 15:17-21. As a result, Array
argues, and the Court agrees, that Array “would suffer
competitive harm if competitors knew what targets it was
pursuing in the pre-clinical stage.” Docket No. 194 at
2.
To the
extent that Loxo argues that Array seeks to redact public
information, the Court is unpersuaded. Loxo points to the
testimony of Dr. Saccomano, in which he stated that certain
information was “public domain” information that
“doesn't matter.” See Docket No.
191-1 at 2 (citing Docket No. 148 at 53:13-17). But Dr.
Saccomano did not testify that Array's trade secret
programs, and the clinical candidates or protein inhibitors
that they focus on, are public information. Rather, he was
referring to information contained on a Loxo PowerPoint
slide, which did not reveal the programs that Array is
working on and seeks to keep confidential.[2] Array seeks to
redact explicit references to certain clinical candidates
that are made in direct reference to Array's Trade
Secrets 1 and 8(a) and which, in context, would reveal the
nature of its trade secret programs. See Docket No.
148 at 110:3-21 (stating the name of the protein target that
is the subject of Trade Secret 8(a) and then correctly
referring to Trade Secret 8(a)). The Court finds that
Array's request is limited to the redaction of
information that is confidential to Array.
Second,
Loxo argues that the information Array seeks to redact
“falls squarely within the kind of information the
public has a fundamental interest in accessing to assure the
fair operation of its courts.” Docket No. 191-1 at 6.
The Court finds that the private interest in redacting the
transcript outweighs the public interest in accessing the
unredacted transcript. Rule 26(c) of the Federal Rules of
Civil Procedure allows the Court to protect materials
containing “trade secret or other confidential
research, development, or commercial information.”
Fed.R.Civ.P. 26(c)(1)(G). Array asserts that it “would
suffer competitive harm if competitors knew what targets it
was pursuing in the pre-clinical stage.” Docket No. 194
at 2. The prevention of such harm is a compelling reason to
redact these few portions of the transcript. See Jones v.
Avidyne Corp., 2010 WL 3829215, at *1 (D. Or. Sept. 24,
2010) (where party “asserted that it would be harmed in
the competitive marketplace if [information it sought to
redact was] publicly disclosed, ” court found
“compelling reason to restrict public access to those
limited portions of the transcript.”); see also
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.”).
While
Loxo argues that the public has a fundamental interest in
accessing the information Array wants redacted, Loxo provides
no relevant authority or argument demonstrating why the
public has an interest in knowing a company's proprietary
trade secrets. Trade secrets are one piece of information to
which the public does not have a presumed right of access.
See Exelis, Inc. v. SRC, Inc., 2013 WL 5464706, at
*2 (S.D.N.Y. Sept. 30, 2013) (granting motion to redact
transcript and stating that “the public does not appear
to possess an interest in the disclosure [of] the discrete
pieces of information at issue (which include the bid
strategies, dollar amounts, and customer analysis of a
government-contract bidder in a competitive market”
i.e., trade secrets). Rather, the public interest typically
weighs in favor of preserving trade secrets. “[T]he
public has a substantial interest in enforcing private
property rights, including rights in trade secrets.”
Loenbro Inspection, LLC v. Sommerfield, No.
18-cv-01943-PAB, 2018 WL 3659396, at *2 (D. Colo. Aug. 2,
2018); see also Aortech Int'l PLC v. Maguire,
2014 WL 12602862, at *4 (D. Utah Dec. 22, 2014) (“There
is a strong public interest in the preservation of trade
secrets and the promotion of fair competition.”).
Accordingly, trade secrets are “the kind of information
that courts will protect.” Valeant
Pharmaceuticals, 2019 WL 3843052, at *1. Further, Loxo
has not set forth any argument that its interests will be
harmed in any way should the transcript be redacted. See
Jones, 2010 WL 3829215, at *2 (finding that balance
between public's right of access and party's interest
in confidentiality weighed in favor of party where party
opposing redaction “ha[d] not demonstrated how an
unredacted version of the transcript will advance their
interests in a way the redacted transcript will not”).
Array
seeks to redact twelve words in a 279-page transcript.
See Docket No. 174-1 at 5. The Court does not
conclude that such a minor redaction would constitute harm to
the public right of access to courts, as “the vast
majority of the transcript remains unredacted and available
to the public.” Jones, 2010 WL 3829215, at *2;
see also Delaware Display Grp. LLC v. LG Elec. Inc.,
221 F.Supp.3d 495, 497 (D. Del. 2016) (stating that
“the proposed redactions should be as narrow as
possible”). The private interest in redaction outweighs
the public interest in access to courts. For these reasons,
the Court will grant Array's motion to redact the
transcript.
Wherefore,
it is ORDERED that Defendant and
Counterclaim-Plaintiff Array Biopharma Inc.'s Motion to
Redact Portions of the June 11, 2019 Hearing Transcript
[Docket No. 175] is GRANTED. It is further
ORDERED that the Transcript of Hearing on
Motion for Preliminary Injunction [Docket No. 148] shall be
redacted as set forth in Array's Motion to Redact.
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