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Arguments made in 'Company Doe' case in federal appeals court

A ruling against the company could reveal its identity and how it kept a safety complaint about its product off SaferProducts.gov

Published: November 01, 2013 03:10 PM

Company Doe wants to keep a report on one of its products locked down.

Was a Maryland district court justified in conducting months of secret litigation and sealing all court records in a lawsuit brought by a corporation the court allowed to be known only as "Company Doe"? That was the crux of the issue debated yesterday in arguments before a federal appeals court in Richmond, Va. The lawsuit filed by the company—Company Doe v. Public Citizen—is of significant public interest because it focuses on whether a report alleging that the company's product harmed a child should be publicly posted on the database on SaferProducts.gov

There was a David and Goliath tone in the courtroom scene, with a single attorney representing consumer-advocacy groups facing off against a team of three attorneys from the prominent global law firm Gibson, Dunn & Crutcher representing Company Doe. Presenting the argument for that firm was Baruch A. Fellner, a partner with considerable experience representing corporate clients in cases challenging federal regulations.

Conducting secret litigation, allowing a corporation to use a pseudonym, and sealing the court documents to protect a company's reputation and economic interests rather than adhering to a long tradition of open judicial proceedings on matters of public interest were unprecedented and unjustified, argued Scott Michelman, attorney for Public Citizen. The consumer-advocacy group filed the appeal seeking to unseal the Company Doe court documents jointly with the Consumer Federation of America and Consumers Union, the policy and advocacy arm of Consumer Reports. (Get the background on Company Doe v. Public Citizen.)

Michelman said that continuing to allow the court documents to remain sealed to protect Company Doe's reputation was particularly questionable given the fact that the district court had vindicated Company Doe by ruling that there were inaccuracies in the report alleging that its product had harmed a child and therefore it should not be posted on SaferProducts.gov. 

The secrecy surrounding the Company Doe case violates the First Amendment rights of the public, including the media, Michelman said. Several media companies submitted a friend-of-the-court brief supporting the consumer groups' appeal to unseal the Company Doe court documents. 

In response, Baruch A. Fellner, the attorney presenting the argument for Company Doe, argued that the economic interests of Company Doe should take precedence over the public's First Amendment right of access to records of federal court proceedings that disclosed the company's identity and the evidence presented in the case. 

Judge Andre M. Davis, who presided over the three-judge federal appeals panel, interrupted Fellner's argument to ask whether Company Doe would still object to having the seal lifted on the documents in six months, 18 months, 24 months, 36 months, or even 10 years from now. Fellner responded that the answer would be the same for all time periods: the company would still object to unsealing the court record. "In your view," Judge Davis replied, the public should never "get a peek" at the records. He then questioned what statute in the federal law that established SaferProducts.gov would authorize the district court to seal the court documents as it had in the Company Doe case.

SaferProducts.gov homepage

Fellner did not cite a specific statute but replied that Congress intended to establish a database with integrity and established rules to ensure materially inaccurate information did not enter the public database. He said Company Doe would not have filed the lawsuit if it had determined that CPSC had responded adequately to its concerns when they were initially raised. 

He said the reason Company Doe would object to unsealing the records at any point in time is that if a consumer were in the market for its product and were to have a choice between Company Doe's version and another brand, having access to court records would negatively influence the person's buying decision. Even though the district court ruled in favor of Company Doe, he argued, if the potential customer saw CPSC briefs in the court records that indicated "the opposite," the customer might choose a competing brand instead. "Economic impact for Company Doe is what is at stake," he said. 

Michelman said that Fellner's argument did not reflect a proper understanding of the public's rights under the First Amendment. "If the documents remain sealed, the public will never know what happened in court, " he said. Understanding the rationale for the decision that was made in favor of Company Doe is especially important since the case represents the first legal challenge to an important public database, he said.

The three judges who heard the arguments presented yesterday will consider and discuss them and then issue an opinion on whether the district court records should be unsealed. On average, opinions are issued 45 to 60 days after arguments are presented, though it sometimes can take longer for complex cases, according to a spokesperson for the federal appeals court in Richmond.

—Andrea Rock

   

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