The Fourth Circuit Court of Appeals has determined that the public’s First Amendment right to access court records and proceedings was violated when a federal district court  sealed the case docket and allowed a company to proceed anonymously in a closely watched lawsuit  challenging the Consumer Product Safety Commission’s (CPSC’s) decision to post a product  safety-incident report on its Website. Company Doe v. Public Citizen, No. 12-2209  (4th Cir., decided April 16, 2014). The company had challenged the posting, claiming that it was materially inaccurate, and sued the agency to keep it off the Website; the district court  agreed and enjoined CPSC from doing so. That aspect of the lower court’s ruling was not at issue  before the Fourth Circuit.

Claiming a First Amendment right to access the court records, a number of consumer-advocacy  organizations sought to intervene in the litigation after the lower court issued its heavily  redacted written opinion that omitted “virtually all of the facts, expert testimony, and evidence  supporting its decision.”The purpose of the motion was to appeal the sealing order and the lower  court’s decision allowing the company to proceed under a pseudonym. The court did not deny the  motion until after the groups filed an appeal from its “constructive denial” of their motion to  intervene. According to the Fourth Circuit, the notice of appeal deprived the district court of  jurisdiction to entertain the motion to intervene; thus the appellate court vacated that order.  While CPSC did not file an appeal, the Fourth Circuit also deter- mined that the groups, despite  their non-party status before the lower court, could seek appellate review of the sealing and  pseudonymity orders “because they meet the requirements for nonparty appellate standing and have  independent Article iii standing to challenge” the orders.

On the merits, the court determined that the public’s presumptive right of access to the docket  sheets and pleadings is not outweighed by a company’s bare allegation of reputational harm,  particularly where, as here, the district court’s entry of a judgment in the company’s favor “vindicated the company and its product.”The Fourth Circuit also  rejected the “district court’s conclusion that sealing was justified to safeguard the statutory  right Company Doe sought to vindicate by bringing the underlying action. . . . The relief Company  Doe secured by prevailing on its claims was the right to keep the challenged report of harm removed  from the online database. That remedy is distinct from the right to litigate its claims in secret  and to keep all meaningful facts about the litigation forever concealed from public view.”  According to the Fourth Circuit, when parties bring their disputes to court, “they must accept the  openness that goes with subsidized dispute resolution by public (and publicly accountable)  officials.”

The appeals court further disagreed with the lower court that allowing access “would impermissibly  impinge upon the manufacturer’s First Amendment right to petition the courts.” in the Fourth  Circuit’s view, “The First Amendment right to petition the government secures meaningful access to  federal courts. it does not provide for a right to petition the courts in secret.”The court also  determined that the public interest in access to the civil proceedings was heightened “by the fact that this legal action marked the first challenge to the accuracy of material sought to be posted  on the Commission’s database.” Measured against this interest, the court found, “Company Doe has  failed to demonstrate any interest sufficient to defeat the public’s First Amendment right of access and to justify continued sealing..”

The Fourth Circuit also faulted the lower court for failing to rule on the motion to seal for some nine months, “thereby allowing the case to remain under temporary seal pursuant to  the district court’s local rules,” and emphasized in this regard that “the public and press  generally have a contemporaneous right of access to court documents and proceedings when the right  applies.” According to the court, a district court must make on-the-record findings on a sealing  request “as expedi- tiously as possible.”

As to the lower court’s order allowing the company to proceed as “Company Doe,” the court  reiterated that “proceeding by pseudonym is a ‘rare dispensation’” and may be allowed only under “extraordinary circumstances.”

The court noted, “[U]se of a pseudonym ‘merely to avoid the annoyance and criticism that may attend . . . litigation’ is impermissible.” A concurring judge agreed with the judgment, but wrote  separately to point out that the company had failed to produce sufficient concrete evidence of the potential harm of proceeding without secrecy. “Had Company Doe supported its motion to seal with expert testimony establishing a high likelihood that denying its  motion to seal would cause it to suffer substantial and irreparable economic harm, the disposition  of the present appeal, in my view, would be completely different.”Without more than a common sense  feeling about potential harm, the concurring judge agreed that the company should not have prevailed on its sealing motion.