Opinion
No. 1:00-CV-0784.
June 24, 2005
APPEARANCES: BOIES, SCHILLER FLEXNER, LLP, Michael Endler, Esq., Jeffrey S. Shelly, Esq., Albany, New York, Attorneys for Plaintiffs.
HOGAN HARTSON, LLP, David J. Hensler, Esq., Washington, DC, and ISEMAN, CUNNINGHAM, RIESTER HYDE, LLP Michael J. Cunningham, Esq., of counsel, Albany, New York, Attorneys for Defendants Robert J. Congel, Woodchuck Hill Associates, Riesling Associates, Madeira Associates and Moselle Associates.
WINSTON STRAWN, Michael K. Atkinson, Esq., Douglas Greenburg, Esq., Krista M. Enns, Esq., Washington, D.C., and DADD AND NELSON, Eric T. Dadd, Esq., Attica, New York, and SHARP GROVE, LLP, James E. Sharp, Esq. Washington, D.C., Attorneys for Defendants Pyramid Company of Onondaga and EklecCo
GOODWIN PROCTER, LLP, Paul F. Ware, Jr., P.C., Anthon S. Fiotto, Esq. Christopher D. Moore, Esq., Boston, Massachusetts, and MacKENZIE HUGHES, LLP, Stephen T. Helmer, Esq., Syracuse, New York, Attorneys for Defendant James A. Tuozzolo.
KING SPALDING, Patricia A. Griffin, Esq., New York, and KING SPALDING John Bray, Esq., David R. Weiser, Esq., N.W. Washington, D.C. Attorneys for Defendants Marc A. Malfitano and Robert Brvenik
KIRKLAND ELLIS, Jeffrey A. Rosen, Esq., James P. Gillespie, Esq., Laura R. Bach, Esq., Washington, D.C. and COSTELLO, COONEY FEARON, LLP, Robert Smith, Esq., of counsel Syracuse, New York, Attorneys for Defendant Scott R. Congel.
McNAMEE, LOCHNER, TITUS WILLIAMS, P.C., Michael J. Grygiel, Esq., of Counsel, William A. Hurst, Esq., of Counsel, Albany, New York, Attorneys for Proposed Intervenors The Herald Company and Capital Newspapers Division of The Hearst Corporation.
MEMORANDUM-DECISION AND ORDER
BACKGROUND
Presently before the Court is the proposed intervenors' objection to the Order of United States Magistrate Randolph F. Treece (Dkt. No. 404), dated April 15, 2005, holding in abeyance their motion for Intervention/Order to Show Cause (Dkt. Nos. 356, 380) pending this Court's determination of defendants' motions for summary judgment. Magistrate Judge Treece's Order is incorporated herein by reference.
Magistrate Judge Treece's brief recitation of the background of the intervention motion is as follows:
Currently pending before this Court is an application, via an Order to Show Cause, by The Herald Company, publisher of The Syracuse Post-Standard, and Capital Newspapers Division of the Hearst Corporation, publisher of the Albany Times Union, ("Proposed Intervenors" or "Newspapers") to intervene in the above captioned action for the limited purpose of obtaining access to various documents Defendants submitted in support of their Motion for Summary Judgment, which, in accordance with the terms of a Confidentiality Order signed by the Court, were filed with the Clerk of the Court under seal. Essentially, by their Motion, the Proposed Intervenors seek a modification of the Confidentiality Order signed by the Honorable Ralph W. Smith, retired United States Magistrate Judge, on March 14, 2001. Dkt. No. 55. The Defendants' Motion for Summary Judgment, which is the focal point of the Intervention Motion, is presently pending before the Honorable Norman A. Mordue, United States District Judge. According to the Docket Report, the matter is now fully briefed and oral arguments have been scheduled for May 20, 2005, in Syracuse, New York, before Judge Mordue. See Text Notice, signed by Judge Mordue on March 25, 2005.
On July 20, 2004, Judge Mordue referred the Proposed Intervenors' Order to Show Cause, and intervention issues raised therein, to this Court for report-recommendation. Dkt. No. 377. The Proposed Intervenors seek to have this Court issue a report-recommendation now, and threatens a mandamus proceeding if we fail to abide by their dictates. See Dkt. No. 403, Michael J. Grygiel, Esq., Lt., dated April, 12, 2005.
Magistrate Judge Treece observed that the right of access asserted by proposed intervenors attaches only to judicial documents. See United States v. Amodeo ( "Amodeo I"), 44 F.3d 141, 145-46 (2d Cir. 1995). He further noted that "the mere filing of a paper or document with the court is insufficient to render that paper a judicial document subject to the right of public access"; rather, "the item filed must be relevant to the performance of the judicial function and useful in the judicial process in order for it to be designated a judicial document." Id. at 145; accord Securities and Exchange Comm. v. TheStreet.com, 273 F.3d 222, 231 (2d Cir. 2001). He reasoned that, inasmuch as the district court has not yet decided the summary judgment motions, the documents at issue have not yet been shown to be useful in the judicial process, and concluded that at this point a recommendation as to a resolution of the intervenors' motion would be premature. He added: "When it is clear that the documents at issue are relevant and, more importantly, useful to the performance of a judicial function, this Court will forthwith issue our recommendation to the District Judge as to the resolution of the Intervention Motion." Accordingly, Magistrate Judge Treece ordered that "the Newspapers' Motion for Intervention/Order to Show Cause (Dkt. No. 356, Proposed Order to Show Cause; Dkt. No. 380, Order granting Application for Order to Show Cause) shall be held in abeyance pending Judge Mordue's determination of the Defendants' Summary Judgment Motion."
Proposed intervenors object. Because Magistrate Judge Treece's order is non-dispositive, the Court reviews it to determine whether it is "clearly erroneous or contrary to law." Fed.R.Civ.P. 72(a). The Court concludes that it is not. Moreover, even accepting proposed intervenors' contention that the de novo standard of review applies, see Fed.R.Civ.P. 72(b), the Court concludes that the proposed intervenors' motion cannot be decided until the Court rules on the summary judgment motions.
DISCUSSION
While most of the motion record on the pending summary judgment motion has already been provided to proposed intervenors, defendants oppose the disclosure of certain items on the ground of attorney-client and work-product privilege. Proposed intervenors claim that they have a right to access to these documents because plaintiffs submitted them to the Court as part of plaintiffs' opposition to defendants' summary judgment motion.
The Court considers first the common-law right of access to "judicial documents." This right stems from the public's right to monitor the federal courts; accordingly, in order to be designated as a judicial document, "the item filed must be relevant to the performance of the judicial function and useful in the judicial process[.]" Amodeo I, 44 F.3d at 145. In many cases it may be reasonable to assume that all papers filed in connection with a summary judgment motion have relevance and utility to the judicial function; however, such an assumption does not necessarily apply in the unusual circumstances of this case. The nature of this case, a dispute among partners in multiple overlapping multi-million dollar business enterprises, has necessitated the disclosure of vast amounts of material. Defendants assert that numerous privileged items were produced among the parties, who as partners shared the partnerships' privileges, and further that they were produced in reliance on the Confidentiality Order signed by Magistrate Judge Ralph W. Smith Jr. on March 12, 2001. Defendants further assert that the fact that plaintiffs included some of the privileged items in their opposition to the summary judgment motion does not necessarily make them judicial documents, particularly because portions of plaintiffs' 15-volume appendix on the motion have been submitted "wholesale" rather than selectively as pertaining to specific issues on the motion. For example, defendants point out that plaintiffs' appendix includes complete transcripts of 33 depositions.
According to the summary judgment brief of Robert J. Congel, the parties have conducted 40 depositions and disclosed over two million pages of documents.
The Court agrees that it is doubtful that the entirety of this massive motion record — which fills five cartons — could be relevant and useful to the Court in deciding the pending summary judgment motions. Under the circumstances, Magistrate Judge Treece's conclusion that it is premature to determine whether the documents sought are "relevant to the performance of the judicial function and useful in the judicial process," id., is certainly not "clearly erroneous or contrary to law." Fed.R.Civ.P. 72(a).
Moreover, even assuming that the documents sought are judicial documents within the meaning of Amodeo I, a ruling on proposed intervenors' motion would nevertheless be premature. While it is true that there is a presumption favoring access to judicial records, "the fact that a document is a judicial record does not mean that access to it cannot be restricted." Amodeo I, 44 F.3d at 146. As the Second Circuit observed,
Although Magistrate Judge Treece did not reach this issue, this Court finds that it supplies an additional ground supporting Magistrate Judge Treece's Order.
the weight to be given the presumption of access must be governed by the role of the material at issue in the exercise of Article III judicial power and the resultant value of such information to those monitoring the federal courts. Generally, the information will fall somewhere on a continuum from matters that directly affect an adjudication to matters that come within a court's purview solely to insure their irrelevance.United States v. Amodeo (" Amodeo II"), 71 F.3d 1044, 1049 (2d Cir. 1995).
As explained by the court in Amodeo II, at one end of the continuum are judicial documents which play a substantial role in determining litigants' substantive rights. A strong presumption of public access adheres to such documents. See id. (noting "especially strong" right of access to evidence introduced in trials); United States v. Graham, 257 F.3d 143, 154 (2d Cir. 2001) (finding strong presumption of access to tapes which were played in open court at pretrial detention hearing and which directly affected court's determination); Joy v. North, 692 F.2d 880, 893 (2d Cir. 1982) (finding strong right of access to report which formed principal basis for dismissal of shareholders' derivative action).
A lesser weight is accorded to the presumption of access to judicial documents which play a lesser role in the judicial action. For example, where a district court "`denied the summary judgment motion, essentially postponing a final determination of substantive legal rights,' the public interest in access `is not as pressing.'" Amodeo II, 71 F.3d at 1049, quoting In re Reporters Comm. for Freedom of the Press, 773 F.2d 1325, 1342 n. 3 (D.C. Cir. 1985) (emphasis in original); see also Graham, 257 F.3d at 151 ("Conversely the presumption of access to documents that do not serve as the basis for a substantive determination — such as documents submitted on a motion for summary judgment which is denied, thus leaving a decision on the merits for another day — is appreciably weaker."). And, "[w]here testimony or documents play only a negligible role in the performance of Article III duties, the weight of the presumption is low and amounts to little more than a prediction of public access absent a countervailing reason." Amodeo II, 71 F.3d at 1050.
Here, if the Court decides the pending summary judgment motions on a preliminary procedural ground without reaching the merits, it is likely that the bulk of the record will pertain to issues which the Court never considers at all. Or, if the Court denies summary judgment after finding questions of fact on a single significant issue, it might not reach any other issues on the motions. Likewise, it is always possible that the motions may be withdrawn or the case settled before the Court issues its decision, as a result of which there will have been no judicial action with respect to which the documents may be relevant or useful. See Kamyr AB v. Kamyr, Inc., 1992 WL 317529, *7 (N.D.N.Y. 1992). On the other hand, the Court may grant either partial or complete summary judgment, which might well give rise to a strong presumption of public access to much — if not all — of the record. Obviously, then, the strength of the presumption of public access to the sealed documents cannot be measured at this time.
A settlement in the business dispute at bar would not implicate the public's monitoring function as did the court's approval of a settlement on behalf of the class in In re "Agent Orange" Product Liability Litigation, 821 F.2d 139, 148 (2d Cir. 1987), a class action against several major chemical companies and the United States government for injuries allegedly suffered by members of the armed forces of the United States, Australia, and New Zealand as a result of exposure to the herbicide Agent Orange while in Vietnam.
It is true that, as intervenors argue, in order to perform its monitoring function the public may need access to documents the Court declines to rely upon in reaching a decision, as well as documents the Court does rely upon. Thus, documents that the Court does not expressly rely upon in issuing its decision may nevertheless be relevant and useful if they bear on an issue which the Court decides. Again, these issues cannot meaningfully be addressed at this point in the litigation.
The Court notes that the question of public interest in the subject-matter of the litigation, which in some circumstances can add weight to a presumption of access, is not likely to do so here. Compare United States v. Graham, 257 F.3d 143, 154 (2d Cir. 2001) (public has strong interest in criminal proceedings); In re "Agent Orange" Product Liability Litigation, 821 F.2d 139, 148 (2d Cir. 1987) (noting "enormous public interest" in class action arising from exposure of members of armed services to herbicide Agent Orange while in Vietnam), with the case at bar, which centers on a dispute among business partners.
Inasmuch as the Court is unable at this time to measure the strength of the presumption of public access to the sealed documents, it is also unable to balance the presumption of access against countervailing factors such as the defendants' privacy interests in protecting attorney-client communications and confidential commercial information, as well as the defendants' interests in protection against unwarranted reputational injury. See Amodeo II, 71 F.3d at 1050-51. Thus, it would be premature to attempt to apply the balancing test to determine proposed intervenors' common-law right of access.
As noted, defendants contend that the privileged documents were produced in reliance on partnership/partner privileges and in reliance on the Confidentiality Order signed by Magistrate Judge Ralph W. Smith Jr. on March 12, 2001. It is likely that the observation of District Judge Thomas J. McAvoy in another case that, without the protective order, discovery would have come to a virtual standstill, is equally apt here. See Kamyr AB v. Kamyr, Inc., 1992 WL 317529, *5 (N.D.N.Y. 1992). Under these circumstances, the fact that plaintiffs submitted such documents in their voluminous opposition to defendants' motions does not, without more, automatically warrant public access.
Likewise, to the extent that there is a First Amendment right to access to judicial documents filed in civil cases, such a right would require the Court to determine whether the documents sought were "judicial documents," and, if so, whether a "compelling interest" militates against access. See Hartford Courant Co. v. Pellegrino, 380 F.3d 83, 91 (2d Cir. 2004) (referring to press's "qualified" First Amendment right to accesscertain judicial documents in civil cases); Diversified Group, Inc. v. Daugerdas, 217 F.R.D. 152, 162, n. 12 (S.D.N.Y. 2003) (noting that attorney-client privilege may constitute "compelling interest" militating against access to summary judgment documents in civil case). Again, an attempt to determine these questions at this point would be premature.
Accordingly, Magistrate Judge Treece properly ordered that the motion for Intervention/Order to Show cause (Dkt. Nos. 356, 380) shall be held in abeyance pending the determination of the defendants' summary judgment motions.
It is therefore
ORDERED that the Order of United States Magistrate Randolph F. Treece (Dkt. No. 404) is hereby approved and affirmed.
IT IS SO ORDERED.