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United States of America Before the National Labor Relations Board Administrative Law Judge Lauren Esposito

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United States of America Before the National Labor Relations Board Administrative Law Judge Lauren Esposito UNITED STATES OF AMERICA BEFORE THE NATIONAL LABOR RELATIONS BOARD ADMINISTRATIVE LAW JUDGE LAUREN ESPOSITO McDONALD’S USA, LLC Cases 02-CA-093893, et al. 04-CA-125567, et al. and 13-CA-106490, et al. 20-CA-132103, et al. FAST FOOD WORKERS COMMITTEE AND 25-CA-114819, et al. SERVICE EMPLOYEES INTERNATIONAL 31-CA-127447, et al. UNION, CTW, CLC, et al. REPLY IN SUPPORT OF GENERAL COUNSEL’S MOTION FOR AN ORDER COMPELLING MCDONALD’S COMPLIANCE WITH THE PARTIES’ PROTECTIVE ORDER Counsel for the General Counsel (“General Counsel”) submits this reply in support of his motion for an order compelling McDonald’s USA, LLC (“McDonald’s”) to comply with the Protective Order entered in this matter April 9, 2015 and modified upon consent of the parties April 27, 2015 (“Order”). McDonald’s opposition brief fails to come to grips with the arguments advanced in the General Counsel’s initial filing, mischaracterizes or misapprehends the arguments made by the General Counsel,1 and attempts to distract the Court with irrelevancies.2 1 In particular, McDonald’s erroneously claims that the legal positions taken by the General Counsel in two other disputes are inconsistent with its current motion contesting McDonald’s “confidential” designations under the Protective Order : first, the General Counsel argued in a subpoena enforcement proceeding that McDonald’s was not entitled to redact subpoenaed documents at the time of production given that the Protective Order by its terms shields McDonald’s documents that qualify as “confidential”; and, second, the General Counsel argued that for purposes of admitting documents into evidence at trial (whether “sealed” or “unsealed” under the Order), McDonald’s cannot plausibly refuse to acknowledge the authenticity of those documents it has produced under subpoena and designated as “confidential”. In making this accusation McDonald’s ignores the fundamental and obvious differences between the legal obligation to produce subpoenaed documents in unredacted form, the evidentiary significance of producing subpoenaed documents with a “confidential” designation, the question whether certain documents or categories of documents qualify for “confidential” status under the terms of the Protective Order, and the potential redaction of certain trial exhibits in the event that only 1 Notably, McDonald’s filing omits any mention of its violation of the Order by designating nearly its entire production as confidential, contrary to the plain language of the Order. Accordingly, at the very least the General Counsel’s request for a ruling on McDonald’s indiscriminate, mass designation—with an appropriate remedy—stands unopposed and is effectively conceded. Moreover, to the extent McDonald’s does attempt to address the propriety of the confidentiality designations assigned to particular categories of documents, McDonald’s opposition fails to accept that the terms of the Order—and common sense—preclude protecting as “confidential” selected portions of those documents are found to warrant protection as “confidential” under the Order. As for the substance of McDonald’s inconsistency accusation, there is obviously no inconsistency in arguing that for purposes of production pursuant to the subpoena and subject to the Protective Order, redacting supposedly sensitive information is inconsistent with the purpose of a protective order (in addition to being contrary to established legal principles and the terms of the subpoena) and, on the other hand, arguing that the supposedly sensitive information is not entitled to protection. McDonald’s attempts to recast the General Counsel’s argument as a representation that McDonald’s “should not worry about public disclosure,” (Opp. at 1), is contradicted by the content of the filings; your Honor is respectfully referred thereto for the argument the General Counsel actually made (and which is accurately summarized above). McDonald’s second assertion, regarding the conflict between its confidentiality designations and its refusal to admit the authenticity of the documents for which it claims confidentiality, reduces to the position, “The designations cannot be both inappropriate for purposes of this Motion but the foundation of his [General Counsel’s] arguments in the Authenticity Motion.” (Opp. at 3, n.1.) That statement, however, is simply false; the designations can easily play both roles. One of General Counsel’s authenticity arguments is that McDonald’s act of designating documents as confidential demonstrates that McDonald’s claims the documents belong to it. That claim of ownership is inconsistent with the refusal to admit that the documents are authentic, but is not inconsistent with the General Counsel’s claim that the designations are being inappropriately applied to non-confidential information. 2 Whether the Service Employees International Union “has demonstrated outward [sic] hostility” toward McDonald’s is obviously analytically independent of whether McDonald’s has properly designated documents as confidential under the terms of the Order. (Opp. at 3.) The SEIU’s purported attitudes therefore provide no basis for denying the General Counsel’s motion. Proceeding from irrelevance to non sequitur, McDonald’s further argues that because OUR Walmart may have disobeyed the terms of a protective order in a different case, McDonald’s has reason to extend the confidentiality protections of the Order in this case to all the documents at issue here. Id. 2 information that is readily available. First, General Counsel anticipates that most of the documents identified in his January 6, 2016 letter to counsel for McDonald’s, attached as Exhibit 1 to General Counsel’s Motion for an Order Finding Authenticity, will be admitted into evidence as exhibits in this matter and hence constitute “judicial documents.” Those documents will therefore fall somewhere on the spectrum “ranging from an “especially strong” presumption requiring “extraordinary circumstances to justify restrictions,” United States v. Myers (In re Nat'l Broadcasting Co.), 635 F.2d 945, 952 (2d Cir.1980), to merely “one of the interests” that may bow before “good reasons” to deny the requested access. Belo Broadcasting Corp. v. Clark, 654 F.2d 423, 434 (5th Cir. Unit A 1981).” U.S. v. Amodeo, 71 F.3d 1044, 1048 (2d Cir. 1995) (emphasis in original). For those documents, even if properly designated in accordance with the terms of the Order, McDonald’s will have to show at least “good cause” to preclude their disclosure. McDonald’s has not, in its opposition, come close to making the particular and specific demonstration of fact required under the law to preclude disclosure. In re Parmalat Secs. Litig., 258 F.R.D. 236, 243 (S.D.N.Y. 2009); Wright, Miller & Marcus, Federal Practice and Procedure § 2035 (2d ed. 1994). But independent of whether the documents are ever offered into evidence, the central fact of the matter, which McDonald’s opposition fails to address, is that the documents at issue are not entitled to protection under the terms of the Order because Section 2 of the Order exempts publicly available information from those protections. Because each of the classes of documents identified is readily available, McDonald’s designation of those documents as confidential or highly confidential directly contradicts the terms of the Order and the documents do not merit the special procedures set forth in that Order. 3 Starting with the franchise agreements, though McDonald’s fails to so admit, there is simply no question that every term other than the specific dollar amount of the rent charged is a matter of public record.3 As made plain in the Franchise Disclosure Document attached as Exhibit 3 to the General Counsel’s initial Motion, every financial term of McDonald’s franchisee agreement is specified in Items 5 and 6. Note 1 of the chart in McDonald’s Franchise Disclosure Document specifies that every fee in that chart, other than the advertising fee of at least 4% of gross revenues and the $79.80 e-mail fee, is “non-refundable and uniform,” indicating that those fees are non-negotiable. Further, contrary to what McDonald’s suggests at page 9 of its Opposition, the testimonial excerpt of Mr. Steinhilper attached thereto as Exhibit 2 undermines the conclusion that rent amounts are open to negotiations; the cited testimony instead discusses how the rent is “calculated” based on a formula Mr. Steinhilper is unable to describe. Indeed, it is extremely puzzling that if, as counsel for McDonald’s suggests, rent is negotiable between McDonald’s and a franchisee, Mr. Brethauer fails to explicitly say so in his declaration. Instead, the opening sentence of paragraph six of his declaration is so vague it precludes drawing any inferences therefrom.4 3 It is therefore quite puzzling what Mr. Brethauer can possibly mean when he says, in paragraph six (6) of his sworn declaration, “McDonald’s maintains strict confidentiality of its franchise agreements because they…contain confidential and proprietary business information, including financial terms.” Not only are the franchise agreements, together with the incorporated operator leases, set forth in McDonald’s own publicly distributed Franchise Disclosure Document, but as Mr. Brethauer should be aware, McDonald’s franchise agreements are available in various court records open to the public. Operator Lease form from 2014 Franchise Disclosure Document attached hereto as Exhibit 1; Order Granting in Part and Denying in Part Defendants’ Administrative Motion to Seal, attached hereto as Exhibit
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