Commercial Division Blog

Posted: August 29, 2022 / Written by: Jeffrey M. Eilender, Samuel L. Butt, Christopher R. Dyess, Joshua Wurtzel, Hillary S. Zilz / Category Commercial Division Justices

Redactions in Memorandum of Law Not Appropriate Where Proposed Redactions Do Not Implicate Business’ Competitive Standing

On August 8, 2022, Justice Masley of the New York County Commercial Division issued a decision in Coresite 32 Ave. of the Ams., L.L.C. v. 32 Sixth Ave. Co. LLC, 2022 NY Slip Op 32670(U) holding that a party could not redact portions of its memorandum of law where the proposed redactions did not protect confidential business information, stating:

In the business context, courts have sealed records where the disclosure of documents "could threaten a business's competitive advantage." (Mosallem v Berenson, 76 AD3d 345, 350-351, 905 N.Y.S.2d 575 [1st Dept 2010] [citations omitted].) Records [*3] concerning financial information may be sealed where there has not been a showing of relevant public interest in the disclosure of that information. (See Dawson v White & Case, 184 AD2d 246, 247, 584 N.Y.S.2d 814 [1st Dept 1992].) A party "ought not to be required to make their private financial information public ... where no substantial public interest would be [**3] furthered by public access to that information" and that "sealing a court file may be appropriate to preserve the confidentiality of materials which involve the internal finances of a party and are of minimal public interest." (D'Amour v Ohrenstein & Brown, 17 Misc.3d 1130[A], 2007 NY Slip Op 52207[U], *20, 851 N.Y.S.2d 68 [Sup Ct, NY County 2007] [citations omitted].)

. . .

As to Owner's Response, good cause exists solely to redact the portions of the Response that refer to the confidential lease terms and business strategies taken by the parties in connection to this action (Mosallem, 76 AD3d at 350-351 [citations omitted]) and is in accordance with the court's prior sealing order. (NYSCEF 70, Decision and Order [mot. seq. no. 001]). However, Owner's proposed redactions of certain portions of the Response are overbroad; for example, good cause does not exist to redact statements describing the building (NYSCEF 565, Response [*5] ¶ 2) without an affidavit from a person with knowledge explaining why that information, if  disputed, would adversely harm a party's economic advantage or competitive standing. Further, good cause does not exist to redact testimony of various deponents that the court has not previously granted the sealing of or redaction of. (See e.g. NYSCEF 565, Response ¶¶ 10, 43-46.) Portions of such deposition, that do not refer to confidential or proprietary business terms and strategy on the face, will not be redacted without a prior order granting such relief by the court. A statement of nonopposition by the plaintiff is insufficient as a basis to redact. Furthermore, disagreement with plaintiff's characterization or claiming to have no knowledge of plaintiff's motivations to lease the premises (see id. ¶ 7), is an insufficient basis to seal or redact.

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