United States District Court For The District of Columbia

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
)
UNITED STATES OF AMERICA, et al., )
ex rel. LAURENCE SCHNEIDER, ) Case No. 1:14-cv-01047-RMC
)
Plaintiffs, ) Judge Rosemary M. Collyer
)
v. ) UNDER SEAL
)
JPMORGAN CHASE BANK, N.A., )
et al., )
)
Defendants. )
)
DEFENDANTS’ REPLY IN
SUPPORT OF MOTION TO SEAL
This Court should grant Chase’s motion to seal because both of the documents at
issue contain sensitive information that Chase disclosed to the government under a mutual
expectation of confidentiality. Schneider’s opposition argues principally that the Court should
not consider Exhibits 1 and 2 because they are not properly before the Court on a motion to
dismiss and because they purportedly “raise more questions than they answer.” E.g., Opp. at 5.
These merits arguments, however, are entirely irrelevant to the sole issue presented by Chase’s
sealing motion: whether the Court should grant Chase’s request to file the documents under seal.
Relying on out-of-Circuit authority, Schneider argues that the documents should
not be sealed because materials submitted in support of a dispositive motion are “judicial
documents” to which a presumption of public access applies. Opp. at 1. As shown below,
however, that is not the law in this Circuit. Moreover, in light of the strong public policy interest
in preserving the confidentiality of regulatory communications and the commercially sensitive

nature of the information contained in the documents, Chase has overcome any general
presumption in favor of public disclosure.
This Court “has authority to seal … documents as part of its ‘supervisory power
over its own records and files’” based on a consideration of “‘the relevant facts and
circumstances of the particular case.’” United States v. Ring, 47 F. Supp. 3d 38, 40 (D.D.C.
2014) (quoting Nixon v. Warner Commc’ns, Inc., 435 U.S. 589, 598 (1978)). In this Circuit,
courts consider the following six factors in determining whether to grant a motion to seal:
(1) the need for public access to the documents at issue; (2) the
extent of previous public access to the documents; (3) the fact that
someone has objected to disclosure, and the identity of that person;
(4) the strength of any property and privacy interests asserted;
(5) the possibility of prejudice to those opposing disclosure; and
(6) the purposes for which the documents were introduced during
the judicial proceedings.
E.E.O.C. v. Nat’l Children’s Ctr., Inc., 98 F.3d 1406, 1409 (D.C. Cir. 1996) (citing United States
v. Hubbard, 650 F.2d 293, 317-22 (D.C. Cir. 1980)). Applying these Hubbard factors, courts
routinely seal documents that contain trade secrets or otherwise reflect proprietary or confidential
business information. See, e.g., FBME Bank Ltd. v. Lew, No. 15-CV-01270 (CRC), 2015 WL
5081209, at *12 n.5 (D.D.C. Aug. 27, 2015) (“[C]orrespondence has been filed under seal
because it may contain confidential business information....”); Paleteria La Michoacana, Inc. v.
Productos Lacteos Tocumbo S.A. de C.V., 292 F.R.D. 19, 25 (D.D.C. 2013) (granting motion to
seal because information regarding “the parties’ sensitive financial data … is commonly sealed
in federal civil litigation”); State of New York v. Microsoft Corp., No. CIV.A. 98-1233 (CKK),
2002 WL 818073, at *1 (D.D.C. Apr. 29, 2002) (granting motion to seal because “[p]rotecting an
entity’s ‘competitive standing’ through retained confidentiality in business information has been
recognized as an appropriate justification for the restriction of public or press access”); see also
F.T.C. v. CCC Holdings Inc., 605 F. Supp. 2d 26, 30 n.1 (D.D.C. 2009) (Collyer, J.) (noting that
2
“confidential business information” was “submitted under seal” and delaying public issuance of
opinion to assure that no such confidential information would be revealed).
Here, the two documents that Chase seeks to file under seal contain or reflect
confidential communications related to Chase’s internal policies and procedures, business plans,
strategies, and risk management practices. Exhibit 1 reflects communications between Chase
and the Monitor for the National Mortgage Settlement regarding Chase’s confidential and
proprietary processes for administering charged-off loans. Similarly, Exhibit 2 is a
communication from Chase to its regulator, the Treasury Department, regarding its internal
controls and compliance testing programs. Thus, both documents contain commercially
sensitive information.
These communications, moreover, were made under a mutual expectation of
confidentiality that facilitates the free flow of information between Chase and the government.
Cf. In re Subpoena Served Upon Comptroller of Currency, & Sec’y of Bd. of Governors of Fed.
Reserve Sys., 967 F.2d 630, 633-34 (D.C. Cir. 1992) (bank supervision “is an iterative process of
comment by the regulators and response by the bank” that is facilitated by the confidentiality of
supervisory communications). Indeed, Chase specifically noted in Exhibit 2 that the document
contained “confidential business information,” and provided that information to Treasury on the
understanding that it would not be made available to the public. Because there is a strong public
policy interest in preserving the privacy of regulatory communications and because Chase could
be harmed by the disclosure of Exhibits 1 and 2 to its competitors, the fourth and fifth Hubbard
factors weigh decisively in favor of sealing.
Nor do any of the other factors support a contrary result. The documents have not
previously been disclosed to the public (factor 2); Chase has consistently objected to the
3
disclosure of confidential communications between Chase and its regulators (factor 3); and
Schneider has not articulated any compelling need for public access to the documents (factor 1).
Accordingly, the Court should grant Chase’s motion to seal.
Schneider responds that a “presumption of immediate public access” attaches to
“judicial documents.” Opp. at 2. This argument fails because the presumption may be
“overcome” based on a consideration of the Hubbard factors. E.g., Nat’l Children’s Ctr., Inc.,
98 F.3d at 1409. Here, Schneider does not argue – and could not argue – that Chase has failed to
satisfy the Hubbard test.
Schneider’s “judicial documents” argument also contradicts his own assertions
that Exhibits 1 and 2 are irrelevant to Chase’s motion to dismiss. In this Circuit, “not all
documents filed with courts fall within [the] purview” of the presumption. United States v. El-
Sayegh, 131 F.3d 158, 161 (D.C. Cir. 1997); accord S.E.C. v. Am. Int’l Grp., 712 F.3d 1, 4 (D.C.
Cir. 2013) (“filing a document with the court is not sufficient to render the document a judicial
record”); see Seattle Times Co. v. Rhinehart, 467 U.S. 20, 33 (1984) (no First Amendment right
of access to discovery information that is not admitted into evidence); In re Reporters Comm. for
Freedom of the Press, 773 F.2d 1325, 1335-36 (D.C. Cir. 1985) (no common law right of access
to “pre-judgment records in private civil cases”); see also Nat’l Children’s Ctr., Inc., 98 F.3d at
1409 (noting that, unlike judicial decisions, “documents filed with the court … often have a
private character, diluting their role as public business”).1 Here, Schneider has argued that
Exhibits 1 and 2 are not properly before the Court on a motion to dismiss and would “not help
1
Schneider cites Lugosch v. Pyramid Co., 435 F.3d 110, 125 (2d Cir. 2006) for the
proposition that “[d]ocuments submitted to a court in support of or in opposition to a [dispositive
motion] are judicial documents.” Opp. at 1. That, however, is plainly not the law in this Circuit.
4
the Court resolve this matter in Chase’s favor.” Opp. at 5. Chase does not agree that the
documents are not properly considered on a motion to dismiss and defers to the Court’s
determination of their importance. To the extent that the Court declines to consider or rely on
the documents, however, they are not “judicial documents” that give rise to a presumption of
public disclosure. See El-Sayegh, 131 F.3d at 162 (documents that “do not eventuate in any
official action” are not “judicial documents”).
December 4, 2015 Respectfully submitted,
/s/ Robert D. Wick

Robert D. Wick (D.C. Bar No. 440817)
Christian J. Pistilli (D.C. Bar No. 496157)
Michael M. Maya (D.C. Bar No. 991742)
COVINGTON & BURLING LLP
One CityCenter
850 Tenth Street NW
Washington, DC 20001
Tel: (202) 662-6000
Fax: (202) 662-6291
Attorneys for Defendants
5
CERTIFICATE OF SERVICE
I hereby certify that on December 4, 2015, a true and correct copy of the
foregoing document was electronically filed under seal via ECF and sent via e-mail or first class
mail to all counsel of record.
/s/ Robert D. Wick

Robert D. Wick
COVINGTON & BURLING LLP
One CityCenter
850 Tenth Street NW
Washington, DC 20001
Tel: (202) 662-6000
Fax: (202) 662-6291
Email: [email protected]
Attorney for Defendants

United States District Court For The District of Columbia

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UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Relying on out-of-Circuit authority, Schneider argues that the documents should

documents” to which a presumption of public access applies. Opp. at 1. As shown below,

in preserving the confidentiality of regulatory communications and the commercially sensitive

presumption in favor of public disclosure.

because it may contain confidential business information....”); Paleteria La Michoacana, Inc. v.

opinion to assure that no such confidential information would be revealed).

proprietary processes for administering charged-off loans. Similarly, Exhibit 2 is a

These communications, moreover, were made under a mutual expectation of

factors weigh decisively in favor of sealing.

Accordingly, the Court should grant Chase’s motion to seal.

Schneider responds that a “presumption of immediate public access” attaches to

satisfy the Hubbard test.

Schneider’s “judicial documents” argument also contradicts his own assertions

official action” are not “judicial documents”).

December 4, 2015 Respectfully submitted,

/s/ Robert D. Wick

Attorneys for Defendants

mail to all counsel of record.

/s/ Robert D. Wick

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