Alexandro Filippini et al vs Tesla Inc

Case Number

20CV01141

Case Type

Hearing Date / Time

Mon, 10/09/2023 - 10:00

Nature of Proceedings

Motion: Seal

Tentative Ruling

Alexandro Filippini, et al. vs. Tesla, Inc. 

Case No. 20CV01141

           

Hearing Date: October 9, 2023                                                           

MATTERS:             Motion To Seal Portions Of The Case Docket And Filings

ATTORNEYS:        For Plaintiffs Alexandro Filippini and Iaian Filippini: Stephen Parnell, Law Offices of Adam Zolonz, APC

For Defendant Tesla, Inc.: Soheyl Tahsildoost, Kainoa Aliviado, Theta Law Firm, LLP

TENTATIVE RULING:

The motion of defendant Tesla, Inc. to seal portions of the case docket and filings is denied.

Background:

This action relates to the purchase of a new 2016 Tesla Model S which allegedly developed numerous problems with its automation system that substantially impaired the use, value, and safety of the subject vehicle. Plaintiffs Alexandro Filippini and Iaian Filippini filed their original complaint for damages against defendant Tesla, Inc., doing business as Tesla Motors, Inc. (Tesla), on February 27, 2020, alleging four causes of action: (1) breach of implied warranty of merchantability under the Song-Beverly Warranty Act, (2) breach of express warranty under Song-Beverly Warranty Act, (3) violation of the Consumer Legal Remedies Act; and (4) violation of Business and Professions Code section 17200 et seq. Tesla’s demurrer to the first, third, and fourth causes of action alleged in the original complaint was sustained, with leave to amend, on August 10, 2020.

Plaintiffs filed their first amended complaint (FAC) on August 31, 2020, alleging four causes of action: (1) breach of the implied warranty of merchantability under the Song-Beverly Warranty Act; (2) breach of express warranty under the Song-Beverly Warranty Act; (3) violation of the Consumer Legal Remedies Act; and (4) violation of Business and Professions Code section 17200 et seq. The Court sustained the demurrer of Tesla to the third and fourth causes of action alleged in the FAC with leave to amend.

Plaintiffs’ second amended complaint (SAC) was filed on March 29, 2021, alleging ten causes of action: (1) breach of the implied warranty of merchantability under the Song-Beverly Warranty Act; (2) breach of the implied warranty of fitness for a particular purpose under the Song-Beverly Warranty Act; (3) breach of express warranty under the Song-Beverly Warranty Act; (4) violation of the Consumer Legal Remedies Act; (5) violation of the False Advertising Law; (6) violation of the Unfair Competition Act; (7) intentional misrepresentation; (8) fraudulent concealment; (9) false promise, and (10) negligent misrepresentation.

On July 19, 2021, the Court sustained Tesla’s demurrer to the seventh, eighth, ninth, and tenth causes of action alleged in the SAC, without leave to amend, and granted Tesla’s motion to strike, without leave to amend with respect to certain specified language within the SAC and with leave to amend as to related to injunctive relief. Court records reflect that plaintiffs did not further amend their pleading. On October 14, 2021, Tesla filed its answer to the SAC and on December 14, 2021, Tesla filed an amended answer to the SAC.

On January 12, 2023, plaintiffs filed a notice of conditional settlement of this matter.

On September 1, 2023, Tesla filed a motion to seal eighty-four entries in the Court’s case docket for this action and the corresponding filings for each docket entry. The matters for which Tesla seeks a sealing order include eight motions filed by plaintiffs to compel Tesla to provide further responses to discovery together with the papers supporting and opposing these motions, three motions for protective orders filed by Tesla relating to plaintiff’s discovery requests together with the papers supporting and opposing these motions, the discovery referee’s recommendations as to plaintiff’s motions to compel and Tesla’s motions for protective orders, Tesla’s objections to the recommendations of the discovery referee and plaintiff’s oppositions thereto, a declaration filed by Tesla regarding the status of written discovery and plaintiffs’ opposition thereto, two Court orders dated September 14, 2023 (the orders) denying Tesla’s motions for protective orders and granting plaintiffs’ motions to compel, a notice of ruling, and an ex parte application for a stay of the orders filed by Tesla together with the papers supporting and opposing the ex parte application.

No party to this matter has filed an opposition to the motion.

Analysis:

California has “long recognized a common law right of access to public documents, including court records.” (Overstock.com, Inc. v. Goldman Sachs Group, Inc. (2014) 231 Cal.App.4th 471, 483 (Overstock).) Accordingly, there exists a presumption that “[c]ourt records are open to the public unless they are specifically exempted from disclosure by statute or are protected by the court itself due to the necessity of confidentiality.” (McGuire v. Superior Court (1993) 12 Cal.App.4th 1685, 1687; Cal. Rules of Court, rule 2.550(c).) “Not all documents submitted or filed by the parties, however, fall within the ambit of the constitutional right of access….[¶] Thus, ‘different levels of protection may attach to the various records and documents involved in [a given] case,’ depending on whether access is predicated on the First Amendment or the common law. [Citation.]” (Overstock,  supra, 231 Cal.App.4th at p. 485.)

California Rules of Court, rules 2.550 and 2.551 apply to “records sealed or proposed to be sealed by court order.” (Cal. Rules of Court, rule 2.550(a)(1). ) (Note: Undesignated rule references herein shall be to the California Rules of Court unless otherwise specified.) Though the rules apply to “discovery materials that are used at trial or submitted as a basis for adjudication of matters other than discovery motions or proceedings”, the rules “do not apply to discovery motions and records filed or lodged in connection with discovery motions or proceedings…” (Cal. Rules of Court, rule 2.550(a)(3); Overstock, supra, 231 Cal.App.4th at p. 494.)

Tesla contends that there exists no private or public right to access the eighty-four records identified in the motion because these matters relate solely to the parties’ discovery disputes. Tesla further contends that the eighty-four records contain or identify Tesla’s confidential and proprietary documents and information which are also purportedly subject to a stipulated protective order and that the parties in this matter have stipulated to the sealing of the eighty-four records identified in the motion.

Court records reflect, and Tesla does not appear to dispute, that the eighty-four records identified in the motion were publicly filed in this matter. To determine whether information has been publicly disclosed, there exists a “meaningful difference” between filing a document with a court and lodging a document with the court. (Mao’s Kitchen, Inc. v. Mundy (2012) 209 Cal.App.4th 132, 150 (Mao’s).) Though lodging a document with the court makes it a temporary record that is not easily accessible such that relevant information in the document could not be readily located by members of the public, “[f]iling a document makes it a part of the permanent court file[.]”. (Id. at pp. 150-151; accord, Overstock.com, Inc. v. Goldman Sachs Group, Inc. (2014) 231 Cal.App.4th 471, 487, fn. 8.) Therefore, discovery materials such as the records at issue in the motion that are filed with the court are “publicly disclosed” such that the information contained in those filed materials is available to anyone who consults the court’s file. (Mao’s, supra, 209 Cal.App.4th at p. 150.)

With the exception of the orders and the discovery referee’s recommendations, the records for which Tesla seeks a sealing order were filed by the parties in this matter between February 2022 and November 2022. Tesla offers no information or evidence to demonstrate that either Tesla or plaintiffs inadvertently or mistakenly filed the of the records identified in the motion instead of lodging the records or did not intend to publicly disclose the information contained in each record at the time the record was filed including any information that Tesla contends is confidential or proprietary. Further, Court records reflect that Tesla did not file a motion to seal any of the records identified in the motion at the time the record was filed. Tesla offers no information or evidence demonstrating inadvertence, mistake, or neglect by Tesla in failing to seek an order sealing the records or portions thereof while the parties were actively litigating their discovery disputes nor did there exist any impediment preventing Tesla from filing a motion for an order sealing the records or any confidential information contained within any particular record.

Though “the sealed records rules are grounded in the First Amendment right of access” which does not provide a right of public access to discovery materials not used at trial or submitted as a basis for adjudication, the public has a First Amendment right of access to civil litigation documents filed in court. (Overstock, supra, 231 Cal.App.4th at pp. 492, 495; Savaglio v. Wal-Mart Stores, Inc. (2007) 149 Cal.App.4th 588, 596 (Savaglio).) Under the circumstances present here, the public has effectively acquired an interest in access to the records identified in the motion. The parties themselves created the public record that gives rise to this public interest in and right to access the records by filing instead of lodging the records and failing to seek an order sealing the records in whole or in part. Furthermore, there is no information or evidence to suggest the parties, acting through experienced and competent counsel, did not know the records or the information contained therein would become part of the Court’s permanent file or would be accessible to the public once the record was filed.

For all reasons discussed above, the records and the information they contain were publicly disclosed by the parties, for over a year, without any effort on Tesla’s part to obtain an order sealing the records during active litigation. Therefore, Tesla has effectively conceded the public’s interest in and right to access the records and the information contained therein. (See also Overstock, supra, 231 Cal.App.4th at p. 498 [addressing issues created by “parties that fail to exercise any discipline as to the confidential documents with which they inundate the courts”].) Moreover, Tesla offers no legal authority to support its request to seal records that have existed in the public record and have been publicly disclosed for, in large part, more than a year.

In addition, with regard to the orders and the discovery referee’s recommendations identified in the motion and above, the public has a constitutional right to access information regarding the conduct of the Court’s business including its rulings and orders. (Ibid.; Cal. Const., art. I, § 3, subd. (b)(1) [“[t]he people have the right of access to information concerning the conduct of the people’s business, and, therefore, … the writings of public officials … shall be open to public scrutiny”].) Tesla has failed to demonstrate, with legal and factual support, why the Court should seal its own orders or the discovery referee’s recommendations on which the Court relied in issuing the orders. For this reason, the orders and the discovery referee’s recommendations are not records that may be properly subject to a sealing order at this stage of the proceedings.

There also exists substantial evidence demonstrating that Tesla has waived its right to obtain an order sealing the records identified in the motion including what Tesla contends is confidential or proprietary material. A waiver consists of “the intentional relinquishment of a known right” and “may also stem from conduct ‘which, according to its natural import, is so inconsistent with an intent to enforce the right as to induce a reasonable belief that such right has been relinquished.’ [Citations.]” (Savaglio, supra, 149 Cal.App.4th at p. 598.) As further discussed above, the records and purportedly confidential information at issue were knowingly publicly disclosed by the parties and have been readily accessible to the public since February 2022. Tesla’s knowing and intentional public filing of the records, and implicitly consenting to plaintiffs’ filing of the records, thereby publicly disclosing the information contained in the records without seeking sealing order until after the parties settled their dispute, is “so inconsistent with an intent to enforce its rights to obtain sealed records under the Rules of Court as to induce a reasonable belief that it had relinquished such right.” (Id. at pp. 600-601.) For these reasons, Tesla waived its right to obtain a court order sealing the records identified in the motion. In addition, Tesla’s conduct arguably has induced a reasonable belief by the public that Tesla has relinquished its whatever rights it may have had to protect any confidential or proprietary information that has been publicly disclosed by the filing of the records.

Having abandoned any legitimate interest in preventing public disclosure of the records and information Tesla now seeks to protect, the only possible purpose underlying Tesla’s request would be to suppress the public record for settlement purposes. Based on information provided in the motion, it appears to the Court that the parties’ settlement includes a confidentiality clause regarding the present litigation. (See, e.g., Motion at p. 18 [citing Tesla’s concerns regarding other plaintiff attorneys acquiring court rulings in this matter to support arguments and positions in other cases including with respect to discovery].) To the extent the parties’ settlement includes a confidentiality clause that requires suppression of information regarding any misconduct by Tesla with regard to the defects alleged by plaintiffs in this matter or in connection with the parties’ discovery disputes, there exist public policy concerns with Tesla’s present request. (See Cariveau v. Halferty (2000) 83 Cal.App.4th 126, 134-135 [confidentiality clause prohibiting discussion of misconduct violated public policy].)

Because there exists a presumption of access to records that are publicly filed with the court, constitutional mandates require the Court to interpret the rules regarding sealed records broadly to further the public’s right of access to court records. (Overstock, supra, 231 Cal.App.4th at pp. 483, 495; see also Sander v. State Bar of California (2013) 58 Cal.4th 300, 309 [“access to court records is governed by long-standing common law principles as well as constitutional principles derived from the First Amendment right of public access to trials”].) Notwithstanding that the records relate to the parties’ discovery dispute and that Tesla contends the records contain confidential and proprietary information subject to a protective order, the evidence shows that experienced and competent counsel knowingly and intentionally filed the records at issue thereby creating the public record and publicly disclosing the information contained in the records. Tesla fails to provide any reason, legitimate or otherwise, for why it did not seek an order sealing the records during active litigation. As Tesla impliedly consented to the public disclosure of the records and the information therein, Tesla cannot now ask this Court to override the public’s interest in open access to the records solely based on a settlement between the parties which, for reasons noted above, implicates public policy concerns. For all reasons discussed herein, and as the Court has serious concerns regarding the sincerity of Tesla’s request, the Court will deny the motion.