Case: 14-11916-HJB Doc #: 55 Filed: 10/09/14 Desc: Main Document Page 1 of 7 10/8/2014 Docket #0055 Date Filed: UNITED STATES BANKRUPTCY COURT DISTRICT OF NEW HAMPSHIRE ---------------------------------------------------------------x : In re: : : GT ADVANCED TECHNOLOGIES INC., et al., : : 1 Debtors. : : ---------------------------------------------------------------x Chapter 11 Case No. 14-11916-HJB Jointly Administered DEBTORS’ EMERGENCY MOTION FOR ENTRY OF ORDER, PURSUANT TO BANKRUPTCY CODE SECTION 107(b) AND BANKRUPTCY RULE 9018, (I) AUTHORIZING FILING OF MOTION TO SEAL UNDER SEAL AND (II) AUTHORIZING RELATED HEARING TO BE CONDUCTED IN CAMERA GT Advanced Technologies Inc. (“GT”) and its affiliated debtors as debtors in possession in the above-captioned cases (collectively, “GTAT” or the “Debtors”) hereby submit this motion (the “Motion”), pursuant to section 107(b) of title 11 of the United States Code (the “Bankruptcy Code”) and Rule 9018 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), for entry of an order (i) authorizing GTAT to file under seal the Debtors’ Emergency Motion for (A) Entry of Order, Pursuant to Bankruptcy Code Section 107(b) and Bankruptcy Rule 9018, Authorizing Filing Under Seal of Unredacted Versions of Supplemental First Day Declaration and Motion to Reject, or (B) Alternatively, Entry of Order, Pursuant to Bankruptcy Code Sections 105(a) and 107(a) Directing Debtors to File Unredacted Versions Thereof, including all exhibits thereto (the “Motion to Seal”) and (ii) authorizing the hearing related to the Motion to Seal to be conducted in camera. In support of this Motion, GTAT respectfully represents: 1 The debtors in these chapter 11 cases, along with the last four digits of each debtor’s tax identification number, as applicable, are: GT Advanced Technologies Inc. (6749), GTAT Corporation (1760), GT Advanced Equipment Holding LLC (8329), GT Equipment Holdings, Inc. (0040), Lindbergh Acquisition Corp. (5073), GT Sapphire Systems Holding LLC (4417), GT Advanced Cz LLC (9815), GT Sapphire Systems Group LLC (5126), and GT Advanced Technologies Limited (1721). The Debtors’ corporate headquarters are located at 243 Daniel Webster Highway, Merrimack, NH 03054. ¨1¤I30.*( 0)« 1411916141008000000000016 Case: 14-11916-HJB Doc #: 55 Filed: 10/09/14 Desc: Main Document Page 2 of 7 PRELIMINARY STATEMENT 1. By this Motion, GTAT seeks entry of an order authorizing GTAT to file the Motion to Seal under seal and to have the hearing related to the Motion to Seal be conducted in camera. GTAT recognizes the unusual (and perhaps unprecedented) nature of the request made in this Motion. However, GTAT is compelled to make this request to avoid the risk of liquidated damages claims in the amount of $50 million per violation under certain confidentiality agreements involving a third party, which agreements themselves are required to be kept confidential. JURISDICTION, VENUE AND STATUTORY BASIS 2. The Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and 1334. This matter is a core proceeding within the meaning of 28 U.S.C. § 157(b)(2). Venue is proper pursuant to 28 U.S.C. §§ 1408 and 1409. 3. The statutory bases for the relief requested herein are section 107(b) of the Bankruptcy Code and Bankruptcy Rule 9018. BACKGROUND 4. On the date hereof (the “Petition Date”), GTAT commenced voluntary cases under chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of New Hampshire (the “Court”). GTAT continues to operate its business and manage its properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No request for the appointment of a trustee or examiner has been made in these chapter 11 cases and no committees have been appointed or designated. 5. GTAT has requested that these chapter 11 cases be consolidated for procedural purposes only and jointly administered pursuant to Bankruptcy Rule 1015(b). 2 Case: 14-11916-HJB Doc #: 55 Filed: 10/09/14 Desc: Main Document 6. Page 3 of 7 Information regarding GTAT’s business, capital structure, and the circumstances leading to these chapter 11 cases is set forth in the Declaration of Daniel W. Squiller in Support of Chapter 11 Petitions and First-Day Motions [Docket No. 14] (the “First Day Declaration”) and the Supplemental Declaration of Daniel W. Squiller in Support of Chapter 11 Petitions and First-Day Motions (the “Supplemental First Day Declaration”), which are incorporated herein by reference. GTAT’s Business 7. GTAT and its non-Debtor affiliates (collectively, the “GTAT Group”) are leading manufacturers and suppliers of advanced materials and equipment for the global consumer electronics, power electronics, solar, and LED industries. The GTAT Group designs and sells high-quality sapphire production equipment and materials for a wide variety of domestic and international markets, including the consumer electronics market. In addition, the GTAT Group’s historical business is based in the solar industry, where it is a leading provider of key polysilicon and photovoltaic equipment, services and technologies. The GTAT Group is also in the process of developing and commercializing additional equipment and products, including an ion implantation equipment tool and advanced solar cell metallization and interconnect technology. As of the Petition Date, the GTAT Group employs approximately 1,100 full-time employees in the United States and abroad, approximately 1,000 of whom work for the Debtors. The stock of GT is publicly traded under the symbol “GTAT”. 8. As of June 28, 2014, the GTAT Group’s unaudited and consolidated financial statements reflected assets totaling approximately $1.5 billion and liabilities totaling approximately $1.3 billion. 3 Case: 14-11916-HJB Doc #: 55 Filed: 10/09/14 Desc: Main Document Page 4 of 7 RELIEF REQUESTED 9. GTAT requests that the Court enter an order, substantially in the form attached hereto as Exhibit A, authorizing GTAT to file the Motion to Seal under seal and authorizing that the related hearing be conducted in camera. BASIS FOR THE RELIEF REQUESTED 10. Concurrently with the filing of this Motion, GTAT has filed a redacted version of the Motion to Seal. To be able to adequately prosecute the relief requested in the Motion to Seal, GTAT is compelled to discuss in such motion the terms of its confidentiality obligations to a third party. However, even the terms of GTAT’s confidentiality obligations are required to be treated confidentially. As noted above, violations of its confidentiality obligations could expose GTAT to $50 million in liquidated damages per occurrence. To avoid any argument that disclosure of the materials contained in the Motion to Seal violate GTAT’s confidentiality obligations, GTAT requests authorization to file the Motion to Seal under seal. In addition, the hearing on the Motion to Seal will necessarily require a discussion of the materials contained in the Motion to Seal. Accordingly, GTAT also requests that it be permitted to conduct the hearing on that motion in camera. GTAT requests that the in camera hearing be attended solely by representatives of GTAT, the U.S. Trustee, and the party that is affected by the Motion to Seal. 11. Section 107(a) of the Bankruptcy Code codifies the public’s right of access to bankruptcy proceedings, providing that: [e]xcept as provided in subsection (b) of this section, a paper filed in a case under [the Bankruptcy Code] and the dockets of a bankruptcy court are public records and open to examination by an entity at reasonable times without charge. 11 U.S.C. § 107(a). The Bankruptcy Code also recognizes certain exceptions to the public access right under section 107(a), including that: 4 Case: 14-11916-HJB Doc #: 55 Filed: 10/09/14 Desc: Main Document Page 5 of 7 [o]n request of a party in interest, the bankruptcy court shall, and on the bankruptcy court’s own motion, the bankruptcy court may— (1) protect an entity with respect to a trade secret or confidential research, development, or commercial information; or (2) protect a person with respect to scandalous or defamatory matter contained in a paper filed in a case under this title. 11 U.S.C. § 107(b).2 12. The purpose of the exception under section 107(b)(1) is to protect business entities from disclosure of information “that could reasonably be expected to cause . . . [them] commercial injury.” In re Global Crossing Ltd., 295 B.R. 720, 725 (Bankr. S.D.N.Y. 2003). Consistent with that purpose, “commercial information” is considered to be information that would cause an “unfair advantage to competitors by providing them information as to the commercial operations.” See Video Software Dealers Ass’n v. Orion Pictures Corp. (In re Orion Pictures Corp.), 21 F.3d 24, 27 (2d Cir. 1994) (citation and quotation marks omitted). Where section 107(b) of the Bankruptcy Code is satisfied, the court may also authorize that the related hearing be conducted in camera to the extent required. See, e.g., In re Global Crossing Ltd., 295 B.R. 720, 724 (Bankr. S.D.N.Y. 2003); In re Farmland Indus., Inc., 290 B.R. 364, 370 (Bankr. W.D. Mo. 2003). NOTICE 13. Notice of this Motion has been provided by email, facsimile or overnight courier to: (a) the Office of the United States Trustee for Region 1, 1000 Elm Street, Suite 605 2 Bankruptcy Rule 9018 specifies the framework for implementing relief under section 107(b) as follows: [o]n motion or on its own initiative, with or without notice, the court may make any order which justice requires (1) to protect the estate or any entity in respect of a trade secret or other confidential research, development, or commercial information, [or] (2) to protect any entity against scandalous or defamatory matter contained in any paper filed in a case under the Code, . . . . Fed. R. Bankr. P. 9018. 5 Case: 14-11916-HJB Doc #: 55 Filed: 10/09/14 Desc: Main Document Page 6 of 7 Manchester, NH 03101, Attn: Geraldine L. Karonis; (b) the creditors holding the 20 largest unsecured claims against GTAT’s estates (on a consolidated basis); (c) the indenture trustee for the Debtors’ (i) 3.00% Convertible Senior Notes due 2017, and (ii) 3.00% Convertible Senior Notes due 2020, U.S. Bank National Association, 60 Livingston Avenue, St. Paul, MN 55107, Attn: Hazrat R. Haniff; (d) the Internal Revenue Service, 1000 Elm St., 9th Floor Manchester, NH 03101, Attn: District and Regional Directors; (e) U.S. Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549; (f) Apple Inc., 1 Infinite Loop, Cupertino, CA 95014, Attn: Jessica L. Fink, Senior Restructuring Counsel; and (g) those parties who have formally filed requests for notice in these chapter 11 cases pursuant to Bankruptcy Rule 2002. NO PRIOR REQUEST 14. No previous request for the relief sought herein has been made by GTAT to this or any other court. WAIVER OF MEMORANDUM OF LAW 15. GTAT requests that the Court waive and dispense with the requirement set forth in Rule 7102(b)(2) of the Local Bankruptcy Rules for the United States Bankruptcy Court for the District of New Hampshire (“LBR”) that any motion filed shall have an accompanying memorandum of law. The legal authorities upon which GTAT relies are set forth in the Motion. Accordingly, GTAT submits that a waiver of the LBR 7102(b)(2) requirement is appropriate under these circumstances. [remainder of page intentionally left blank] 6 Case: 14-11916-HJB Doc #: 55 Filed: 10/09/14 Desc: Main Document Page 7 of 7 WHEREFORE, GTAT respectfully requests that the Court enter an order, substantially in the form attached hereto, granting the relief requested herein and granting GTAT such other and further relief as is just and proper. Dated: October 9, 2014 Manchester, NH /s/ Daniel W. Sklar_____________________ Daniel W. Sklar, Esq. Holly J. Barcroft, Esq. NIXON PEABODY LLP 900 Elm Street Manchester, NH 03101-2031 Telephone: (603) 628-4000 Facsimile: (603) 628-4040 - and Luc A. Despins, Esq. Andrew V. Tenzer, Esq. James T. Grogan, Esq. PAUL HASTINGS LLP Park Avenue Tower 75 East 55th Street, First Floor New York, New York 10022 Telephone: (212) 318-6000 Facsimile: (212) 319-4090 Proposed Co-Counsel for the Debtors and Debtors in Possession Case: 14-11916-HJB Doc #: 55-1 Filed: 10/09/14 Desc: Proposed Order Exhibit A Page 1 of 3 UNITED STATES BANKRUPTCY COURT DISTRICT OF NEW HAMPSHIRE ---------------------------------------------------------------x : In re: : : GT ADVANCED TECHNOLOGIES INC., et al., : : 1 Debtors. : : : ---------------------------------------------------------------x Chapter 11 Case No. 14-11916-HJB Jointly Administered RE: Docket Nos. __ ORDER, PURSUANT TO BANKRUPTCY CODE SECTIONS 105(A) AND 107(B) AND BANKRUPTCY RULE 9018, (I) AUTHORIZING FILING OF MOTION TO SEAL UNDER SEAL AND (II) AUTHORIZING RELATED HEARING TO BE CONDUCTED IN CAMERA Upon the motion (the “Motion”)2 of GT Advanced Technologies Inc. (“GT”) and its affiliated debtors as debtors in possession (collectively, “GTAT” or the “Debtors”) for entry of an order, pursuant to section 107(b) of title 11 of the United States Code (the “Bankruptcy Code”) and Rule 9018 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), authorizing GTAT (i) authorizing GTAT to file under seal the Debtors’ Emergency Motion for (A) Entry of Order, Pursuant to Bankruptcy Code Section 107(b) and Bankruptcy Rule 9018, Authorizing Filing Under Seal of Unredacted Versions of Supplemental First Day Declaration and Motion to Reject, or (B) Alternatively, Entry of Order, Pursuant to Bankruptcy Code Sections 105(a) and 107(a) Directing Debtors to File Unredacted Versions Thereof, including all exhibits thereto (the “Motion to Seal”) and (ii) authorizing related hearing to be conducted in 1 The debtors in these chapter 11 cases, along with the last four digits of each debtor’s tax identification number, as applicable, are: GT Advanced Technologies Inc. (6749), GTAT Corporation (1760), GT Advanced Equipment Holding LLC (8329), GT Equipment Holdings, Inc. (0040), Lindbergh Acquisition Corp. (5073), GT Advanced Sapphire Systems Holding LLC (4417), GT Advanced Cz LLC (9815), GT Sapphire Systems Group LLC (5126), and GT Advanced Technologies Limited (1721). The Debtors’ corporate headquarters are located at 243 Daniel Webster Highway, Merrimack, NH 03054. 2 Capitalized terms used but not otherwise defined herein shall have the meanings set forth in the Motion. Case: 14-11916-HJB Doc #: 55-1 Filed: 10/09/14 Desc: Proposed Order Exhibit A Page 2 of 3 camera, all as more fully set forth in the Motion; and upon consideration of the First Day Declaration and the Supplemental First Day Declaration; and it appearing that the relief requested is in the best interests of GTAT’s estates, its creditors, and other parties in interest; and this Court having jurisdiction to consider the Motion and the relief requested therein pursuant to 28 U.S.C. §§ 157 and 1334; and consideration of the Motion and the relief requested therein being a core proceeding pursuant to 28 U.S.C. § 157(b); and venue being proper before this Court pursuant to 28 U.S.C. §§ 1408 and 1409; and due and proper notice of the Motion having been provided under the particular circumstances, and it appearing that no other or further notice need be provided; and after due deliberation and sufficient cause appearing therefor, it is hereby ORDERED THAT: 1. The Motion is GRANTED as set forth herein. 2. Pursuant to Bankruptcy Code section 107(b)(1) and Bankruptcy Rule 9018, GTAT is authorized and directed to file the Motion to Seal under seal, which shall remain under seal, confidential, and not made available to anyone, except for (i) the Court, (ii) the Office of the United States Trustee, and (iii) counsel to any official committee of unsecured creditors. 3. The hearing on the Motion to Seal shall be conducted in camera and shall be attended solely by representatives of GTAT, the U.S. Trustee, and the party that is affected by the Motion to Seal. 4. The requirement set forth in LBR 7102(b)(2) that any motion filed shall have an accompanying memorandum of law is waived. 5. GTAT is authorized to take all actions necessary to effectuate the relief granted pursuant to this Order in accordance with the Motion. Case: 14-11916-HJB Doc #: 55-1 Filed: 10/09/14 Desc: Proposed Order Exhibit A Page 3 of 3 6. This Court retains jurisdiction with respect to all matters arising from or related to the implementation of this Order. Dated:_______________, 2014 Manchester, NH HONORABLE HENRY J. BOROFF UNITED STATES BANKRUPTCY JUDGE