On December 10, 2025, Justice Patel of the New York County Commercial Division issued a decision in Fox and Main, LLC v. Pyramid-BMC Holdings, LLC, 2025 NY Slip Op. 34737(U), denying a motion to seal for lack of evidentiary support for the claim that the document met the standard for sealing, explaining:
Pursuant to § 216.1(a) of the Uniform Rules for Trial Courts, the Court may seal a filing upon a written finding of good cause, which shall specify the grounds thereof. In determining whether good cause has been shown, the court shall consider the interests of the public as well as of the parties. There is a presumption that the public has the right of access to the courts to ensure the actual and perceived fairness of the judicial system, as the the bright light cast upon the judicial process by public observation diminishes the possibilities for injustice, incompetence, perjury, and fraud.
The public right to access, however, is not absolute.. The burden of proof on a sealing application is upon the party who desires that the record be impounded or, as here, remain sealed because of the need to establish compelling circumstances for the secrecy. Although the rule does not further define good cause, a standard that is difficult to define in absolute terms, a sealing order should rest on a sound basis or legitimate need to take judicial action, a showing properly burdening the party seeking to have a sealed record remain sealed.
Courts have routinely held that a negative impact as to a movant’s ability to conduct business or participate in negotiations is sufficient to warrant sealing. Similarly, courts have held that sealing is warranted for records that are a source of business information which might harm a litigant’s competitive standing. The absence of a showing of any legitimate public concern, as opposed to mere curiosity may also weigh in favor of sealing.
However, merely marking certain documents as confidential is not controlling on the court’s determination whether there is good cause to seal the record. The First Department has generally been reluctant to allow the sealing of court records and has authorized sealing only in strictly limited circumstances, e.g., where trade secrets are involved, or where the release of documents could threaten a business’s competitive advantage. Sealing should therefore be denied where there is no showing that the documents contain any trade secrets or other revelations that might harm a party’s competitive standing in the industry.
The parties contend that the documents they seek to seal entail various confidential agreements entered into by the parties, letters exchanged between the parties excerpting and/or paraphrasing those agreements, and deposition transcripts from this litigation containing questioning and testimony excerpting and/or paraphrasing those agreements. The parties’ argument principally relies on the premise that the documents in question should be sealed or redacted because the parties designated the documents or relevant information as confidential, pursuant to the terms of both the confidentiality stipulation entered on the docket in this case and one of the contracts that the parties seek to seal.
The First Department’s decision in Mosallem is instructive here. In that case, the court denied the defendants’ motion to seal on several grounds, three of which bear upon the instant motions. First, the sealing motion in Mosallem was accompanied solely by the affirmation of an attorney who did not purport to have any personal knowledge of the documents. No affidavits were submitted by any of the defendants, the authors of the documents or the participants in the events recorded therein. Consequently, the court found that there is no evidence in the record as to why the documents are so confidential or sensitive that public access to them should be restricted. Second, the court held that merely because some of the documents were marked confidential or private is not controlling on the court’s determination whether there is good cause to seal the record. Third, the defendants did not act with haste in moving to seal, instead filing their motion nearly two months after the filing of the documents at issue. The court found that defendants’ failure to take prompt action undermines their claims that the documents contain confidential business information.
As in Mosallem, the sealing motions here are accompanied solely by the affirmation of attorneys who did not purport to have any personal knowledge of the documents. No affidavits were submitted by any party with personal knowledge of the documents, nor was any other evidence submitted substantiating the parties’ claims that the documents contain sensitive commercial information, proprietary business information, confidential financial details, or competitively sensitive data. The conclusory assertion that the documents at issue contain confidential commercial information, such as granular financial details, strategic plans, and proprietary operational methodologies is not substantiated by any evidence in the record.
Rather, the sole basis for sealing set forth in the parties’ sealing and redaction spreadsheets is as follows:
This document contains confidential, proprietary, and competitively sensitive information, which reflects the competitive expertise the parties are able to provide in their business dealings. This document also contains conditions and terms that have been negotiated, agreed upon, and undertaken by the parties as part of their business transactions and contain confidential proprietary information. As explained in the attorney affirmation and Memorandum of law, maintaining the privacy of the parties’ business practices is essential to their business operations, advantages over competitors, and continued success as a company.
In addition, the parties have identified this exhibit as “CONFIDENTIAL” pursuant to the Commercial Division Confidentiality Stipulation on March 31, 2025, which was further ordered by this Court on April 3, 2025.
These assertions are both conclusory and generic: every confidentiality designation provided by the parties is identical to, excerpts from, or entails minor variations to the designation above. In no circumstance do the parties provide a basis for sealing any document that is specific to that document. Consequently, there is no showing that the documents contain any trade secrets or other revelations that might harm the parties’ competitive standing in the industry. The fact that the parties marked the documents in question as “confidential” fails to alter this conclusion.
(Internal quotations and citations omitted).