Generalized Assertions of Good Cause for Sealing or Confidentiality Agreement Insufficient to Seal Court Records

On January 19, 2023, Justice Joel M. Cohen of the New York County Commercial Division issued a decision in International Business Machines Corp. v. GlobalFoundries U.S. Inc., 2023 NY Slip Op 30203(U), holding that a party's "generalized assertions" of good cause and a confidentiality or sealing stipulation were insufficient to permit sealing of court records, explaining:

GlobalFoundries' generalized assertions of good cause [*3] for sealing the documents identified as Exhibits E and K (NYSCEF 336, 342) is insufficient. While portions of the Exhibits may reveal proprietary and highly sensitive non-public information about the confidential terms of the parties' relationship, the proposed sealing is not adequately explained or justified. In view of the admonition that sealing of court records must be "narrowly tailored to [**3] serve compelling objectives," (Danco, 274 AD2d at 6), GlobalFoundries will need to propose and justify targeted redactions that satisfy the requirements of 22 NYCRR § 216 [a] and applicable case law.

. . .

Finally, the Court does not find good cause to seal Exhibits F, P, and Q (NYSCEF 337, 347, 348). The fact the parties have stipulated to sealing documents, or that they have designated the documents during discovery [*4] as "Confidential" or "Highly Confidential," does not, by itself, justify granting motion to seal (see, e.g., Maxim, 145 AD3d at 518; Gryphon, 28 AD3d at 324). The Court also notes that GlobalFoundries does not seek to permanently seal the documents identified as Exhibits C, D, G, H, I, L, M, N, O, R, and U (NYSCEF 334, 335, 338, 339, 340, 343, 344, 345, 346, 349, and 350 in its instant motion) (see NYSCEF 373 at 2). As a result, these documents will be unsealed.

As this case shows, the parties' agreement to maintain documents as confidential or under seal will not be binding on the court, and instead, the court will require a showing of "good cause" to maintain filed documents under seal. Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning the sealing of court records or other documents.