4. Documents Referenced in the Summary Judgment Hearings and in the Final Pretrial Statement
The references at the summary judgment hearing to documents alleged to contain sensitive commercial information were general, not detailed. Although some of this allegedly sensitive data is already in the public domain because it is included in the publicly filed transcript, or is contained in the DSS's or the FPS which have been declassified, we view this part of plaintiffs' motion in its "wholesale" aspect. Plaintiffs have not canvassed the summary judgment hearing record and tendered to us a list of documents referred to therein, nor have we considered it an appropriate expenditure of judicial time for us to do so. There may well have been documents referred to at the hearing which contain sensitive commercial information, but which are not already in the public domain. To that extent, the countervailing interests in protection of this material would be strong.
We have concluded in our discussion of the applicable law that although documents that are referred to at a hearing become part of the record, the nature of the reference may support nondisclosure of record materials if the reference is extremely general or noninformational and if countervailing interests are shown.
We have also determined that the presumption of access to materials referred to in a general way is very weak, and that the presumption is weaker still when the general purposes of the right to inspect and copy are well served absent release of those materials. These conditions are all present here, in part because of our other declassification orders. Under these circumstances, we will deny access to documents merely referenced in the summary judgment hearing.
We need not labor the question whether the motion before us requires us to classify documents that are referenced in the FPS. We have already concluded, see supra note 65, that documents that are referenced in papers filed on the public record are not part of that record for access purposes.
5. The "Raw Economic Data" Contained in Sealed Discovery Responses and the Final Pretrial Statement Appendices
We have explained above how the defendants have filed under seal extensive raw economic data, some of which has been attached by the plaintiffs as appendices to the FPS. See note 84 supra. This material includes such matters as the prices charged by defendants for various models of television receivers at different levels of distribution, and documents reflecting certain dealings with specific customers. This material does not fall into the categories we have discussed in Part III-B of this opinion: it is not material that is the subject of an evidentiary hearing; it is not material referred to at a hearing; and it is not material that was the ultimate subject of a dispositive ruling. It is, because it has been filed in the record of the court, material subject to an access right, but, as we have seen, that access right is not absolute. The presumption of access to this economic data is not strong. The public's general educative and monitoring interests, as well as its specific interest in antitrust and international trade matters, are essentially satisfied by our declassification of the FPS and of the DSS's, especially the expert witness reports.
On the other hand, the interests favoring nondisclosure are strong. The raw economic data obviously contains sensitive commercial information. Although the information is old, we are persuaded by the submissions by Mr. Miyamoto and Mr. Yamagishi, see notes 21 and 22 supra, that significant harm could come to the defendants from disclosure of this information in its raw form. Accordingly, we will deny access to the raw economic data.
Our determination that the public's access rights do not, on balance, require the release of some categories of documents does not dispose of plaintiffs' motion. Because plaintiffs urge that their First Amendment rights are infringed by continued nondisclosure, we must decide whether the Constitution requires more than does the common law right of access.
IV. First Amendment Interests in Judicial Records
The First Amendment's Protection of the freedoms of speech and press from unjustifiable governmental restraints includes protection from judicial orders. See, e.g., Nebraska Press Association v. Stuart, 427 U.S. 539, 96 S. Ct. 2791, 49 L. Ed. 2d 683 (1976); Craig v. Harney, 331 U.S. 367, 67 S. Ct. 1249, 91 L. Ed. 1546 (1947). Because the First Amendment unquestionably protects the dissemination of information about court proceedings, we must consider whether Rule 26(c) protective orders that are imposed on a showing of good cause are or may be constitutionally invalid prior restraints of speech. See, e.g., In re San Juan Star Co., 662 F.2d 108 (1st Cir. 1981); In re Halkin, supra.
In addition to inquiring into litigants' First Amendment interests in discovery materials, we must decide whether the First Amendment affords the public access rights to judicial records. The Supreme Court has found that the Constitution does guarantee access to criminal trials under some circumstances. Richmond Newspapers, Inc. v. Virginia, supra. In United States v. Criden, supra, 648 F.2d at 821 n.6, the Third Circuit noted that the question whether there is a correlative constitutional guarantee of access to court records was left open by Richmond Newspapers. The Third Circuit found it unnecessary to answer the question in Criden, which was decided on nonconstitutional grounds.
We will address each of these First Amendment questions in turn. With respect to Rule 26(c) protective orders, we conclude that litigants' First Amendment interests in the dissemination of discovery materials are adequately protected by the balancing of interests for and against nondisclosure and drafting such orders in the least restrictive manner possible. With respect to the question whether the common law right to inspect and copy has a constitutional dimension, we conclude that it does not.
B. First Amendment Rights in Discovery Materials
Plaintiffs assert that their First Amendment rights to disseminate information in their possession is violated by our continued enforcement of PTO 35. Arguing that Rule 26(c) protective orders are prior restraints of speech, they contend that PTO 35 cannot survive analysis in light of " "(t)he heavy presumption against ... constitutional validity' that an order restraining publication bears," Nebraska Press Association v. Stuart, supra, 427 U.S. at 545, 96 S. Ct. at 2796, quoting New York Times Co. v. United States, 403 U.S. 713, 714, 91 S. Ct. 2140, 2141, 29 L. Ed. 2d 822 (1971).
The Third Circuit has not decided whether the dissemination of information contained in discovery materials is entitled to First Amendment protection.
The best known opinion that analyzes protective orders under the First Amendment, and concludes that they must be viewed as prior restraints of speech, is that of the District of Columbia Circuit Court of Appeals in In re Halkin, supra.
In a very recent opinion, In re San Juan Star Co., supra, the First Circuit decided that Rule 26(c) protective orders implicate "significant but limited" First Amendment interests. Id., at 114. Chief Judge Coffin for the First Circuit announced a less exacting test of constitutionality than did the District of Columbia Circuit, one that we think better takes account of the special nature of discovery materials. We will review both decisions and then explain why we find San Juan Star the more persuasive.
In In re Halkin, the court reviewed a district court order that restrained the parties and their counsel from discussing or disclosing publicly any "documents and information" obtained from certain federal agencies through discovery.
The court found that the order "pose(d) many of the dangers of a prior restraint," so that its impact on constitutionally protected expression had to be scrutinized closely, 598 F.2d at 186, and then proceeded to examine the First Amendment interests of the litigants that were affected by the district court order. Because the right to disseminate information does not depend on the method of its acquisition, cf. New York Times Co. v. United States, 403 U.S. at 745, 91 S. Ct. at 2157 (refusing to restrain publication of stolen government documents), and participation in civil litigation cannot by itself constitute a waiver of First Amendment rights,
cf. Curtis Publishing Co. v. Butts, 388 U.S. 130, 145, 87 S. Ct. 1975, 1986, 18 L. Ed. 2d 1094 (1967) (declining to find waiver "in circumstances which fall short of being clear and compelling"), the court determined that discussion of information obtained through discovery was protected expression. Therefore, the Halkin court concluded, any protective order that seriously restrains expression must satisfy a three-part test:
"The harm posed by dissemination must be substantial and serious; the restraining order must be narrowly drawn and precise; and there must be no alternative means of protecting the public interest that intrudes less directly on expression." 598 F.2d at 191 (footnotes omitted).
Judge Wilkey, dissenting, found the majority's prior restraint analysis of protective orders misconceived. He argued that the good cause standard of Rule 26(c) amply protected the legitimate interests of litigants. Indeed, he thought the constitutional propriety of the order issued by the district court in Halkin "plain." 598 F.2d at 203. He explained:
The First Amendment interests of litigants in the promulgation of materials exacted from another party through the compulsory processes of the courts are much more limited and of a fundamentally different character from the First Amendment interests of litigants and non-litigants in the public communication of other information concerning judicial proceedings. This is because litigants who wish to disseminate discovery materials have gained access to such materials-access which they would not ordinarily have-through a statutory system that expressly reserves to the courts the power to attach restrictions on the use of such materials.
598 F.2d at 206 (Wilkey, J., dissenting). Judge Wilkey concluded that the district court's power under the Rules of Civil Procedure to limit or condition the use of information obtained in discovery is necessary to "overall fairness" because of the broad scope of discovery permitted by the Rules.
In San Juan Star, the First Circuit reviewed a district court order that barred counsel in a civil rights action from disseminating to the parties or the public any information obtained through deposition testimony.
That court concluded that Rule 26(c) protective orders implicate First Amendment interests, but that the interests of litigants, their attorneys, and others in discovery materials are more limited than their interests in disseminating other kinds of information.
Because discovery rules are liberal, much of the information obtained thereby may never be used at trial; it may be inadmissible because it is irrelevant or unduly prejudicial.
For that reason, the court held that raw deposition testimony is not information entitled to full First Amendment protection because its disclosure would not serve to inform "civic and political discussion," to permit monitoring of the judicial system, or to implement values of judicial openness. At 115. The San Juan Star court was unwilling to deprive discovery materials of all constitutional protection, however, since the First Amendment expresses a concern that "the government not lightly engage in any restraints on communication, particularly when the order is issued prior to the expression taking place." Id. The important role played by protective orders in facilitating discovery and expediting litigation was also noted.
In light of these considerations, the court held that the proper standard for determining the constitutional validity of a protective order is a less stringent than usual application of the test applied to prior restraints. Thus the court would examine the nature of the threatened harm, the effectiveness of the order, the availability of less restrictive alternatives, and the narrowness of the order decreed. The magnitude and imminence of the threatened harm would be evaluated on a "sliding scale: as the potential harm grows more grave, the imminence necessary is reduced."
San Juan Star announces a test for protective orders that successfully takes account of First Amendment concerns while preserving the trial court's broad discretion to impose protective orders for good cause. We think that a satisfactory alternative description of the proper standard is that it is a balancing test. The balance of interests may justify a prior restraint when "the restraint is only reasonably incidental to the achievement of another valid governmental purpose." New Jersey State Lottery Comm'n v. United States, 491 F.2d 219, 222 (3d Cir. 1974) (en banc), vacated on other grounds, 420 U.S. 371, 95 S. Ct. 941, 43 L. Ed. 2d 260 (1975); see United States v. O'Brien, 391 U.S. 367, 376, 88 S. Ct. 1673, 1678, 20 L. Ed. 2d 672 (1968).
The overriding purpose of a protective order is to facilitate the communication of information between litigants.
To accomplish that end, it may be necessary to limit speech by parties and their counsel outside the court. Several general governmental interests support the imposition and enforcement of such orders. First, the courts must preserve the integrity of the discovery system and protect litigants from "annoyance, embarrassment, oppression, or undue burden or expense," Rule 26(c), and must guard against abuse of their own processes. Second, the courts must be able to manage successfully large and complex cases.
Third, courts have a general responsibility to do justice. Litigants in many cases cannot be guaranteed a fair trial of their claims and defenses if necessary documents and materials are not produced; at the same time, the court must seek to protect from unwarranted harm parties whose rights may ultimately be vindicated at trial. See In re San Juan Star Co., supra, at 115.
To apply a balancing test, of course, the particularized interests of the litigants for and against disclosure must be weighed. Litigants do have a general interest in publicizing information that they possess, however acquired. We think it worth emphasizing, however, that even when a protective order is entered, litigants have access to discovery materials for all the purposes for which they are legitimately acquired through court processes.
In sum, we think that the proper standard for deciding whether plaintiffs' First Amendment interests would be violated by our deciding not to declassify certain documents is not a "heavy presumption" of unconstitutionality, but a balancing test. The court must evaluate the magnitude and imminence of the threatened harm from disclosure, including the particularized interests of the litigants against disclosure and the general government interests enumerated above, the narrowness of the proposed limiting order,
and the availability of less restrictive alternatives. We cannot, of course, delineate precisely the application of the test except on a case-by-case basis.
C. Relationship Between the First Amendment and the Common Law Right to Inspect and Copy
In United States v. Criden, supra, the Third Circuit left open the question whether the First Amendment incorporates a right of the public to access to judicial records, but noted that Richmond Newspapers arguably "could be viewed as supporting a right of the public to access to (trial exhibits) through the medium of the broadcasters." 648 F.2d at 821 n.6. We must now address that issue because we have concluded that the balancing of interests will sometimes defeat the common law right of access. We conclude, however, that a constitutional right of access to judicial records does not exist.
At the outset, we emphasize that we address only an asserted constitutional right of access to materials that are part of the case record, but have not yet entered the public domain. The principle that the First Amendment protects the communication of information contained in public court records is well established. E.g., Cox Broadcasting Corp. v. Cohn, 420 U.S. 469, 495, 95 S. Ct. 1029, 1046, 43 L. Ed. 2d 328 (1975).
In Nixon v. Warner Communications, Inc., supra, the Supreme Court rejected the contention that the First Amendment guarantees the press access, for the purpose of inspection and copying, to materials and exhibits used in open judicial proceedings. The court found a distinction of constitutional dimension between access to the information contained in trial exhibits and physical access to the exhibits themselves, explaining that in that case:
There simply were no restrictions upon press access to, or publication of any information in the public domain. Indeed, the press-including reporters of the electronic media-was permitted to listen to the tapes and report on what was heard. Reporters also were furnished transcripts of the tapes, which they were free to comment upon and publish. The contents of the tapes were given wide publicity by all elements of the media. There is no question of a truncated flow of information to the public.
435 U.S. at 609, 98 S. Ct. at 1318.
Warner Communications rejected the possession by the press of a First Amendment right to inspect and copy, and did not consider possible access rights of the general public. We think nonetheless that the case is properly read to hold that the public's right to inspect and copy is not of constitutional stature. We can conceive of no reason why the public's First Amendment rights in this area should be greater than those of the press.
We do not think that the First Amendment holding of Warner Communications has been modified by the Court's more recent Richmond Newspapers decision. Neither the plurality nor concurring opinions in that case suggest that the distinction between access to information and physical access to evidentiary materials is obliterated. Three Justices interpreted that decision as a significant expansion of the First Amendment right of access to information, see 448 U.S. at 583, 100 S. Ct. at 2831 (Stevens, J., concurring); id. at 586, 100 S. Ct. at 2833 (Brennan, J., concurring); id. at 604, 100 S. Ct. at 2842 (Blackmun, J., concurring), but their opinions together received only four votes. The holding of the case is considerably narrower. In his plurality opinion, the Chief Justice relied on traditional First Amendment doctrine to find only that the Constitution does not permit a criminal trial to be closed to the public by the agreement of the trial judge and the parties, absent some showing of special need. He explicitly noted that the Court did not decide whether the First Amendment afforded access rights to civil trials, id. at 580 n.17, 100 S. Ct. at 2829 n.17, or under what circumstances a criminal trial could be closed, id. at 581 n.18, 100 S. Ct. at 2830 n.18.
In sum, we do not think that Richmond Newspapers impliedly diminishes the explicit holding of Warner Communications that there is no constitutional right to inspect and copy.
D. First Amendment Interests in the Remaining Documents at Issue
We must now apply these constitutional principles to determine whether the First Amendment requires us to vacate PTO 35 or to unseal documents referred to in the summary judgment hearing, documents referred to in the FPS (250,000 in number including the DSS's), and documents that contain raw economic data. None of these documents is currently part of the public record; and none of these documents was obtained by plaintiffs other than by use of the discovery process administered by this court. We emphasize that we are not, therefore, confronted with a situation in which a decision not to release these documents would constitute a classic prior restraint. Cf. Nebraska Press Association v. Stuart, supra; Rodgers v. United States Steel Corp., 536 F.2d 1001 (3d Cir. 1976). Because these documents were produced pursuant to PTO 35, the only question before us is whether PTO 35 is a constitutionally valid protective order under the balancing test discussed in Part IV-B, supra. We conclude that it is.
Our first consideration is whether PTO 35 reflects a proper balancing of the need for confidentiality against the First Amendment interest in disseminating discovery materials. We have already enumerated some of the harms that this protective order was intended to prevent, which can be summarized as the danger that discovery would be simply unmanageable in this litigation. We stress that in a case of this size and complexity, that danger is substantial and unmanageable discovery creates serious delays and a risk of unfairness. An additional potential harm to which PTO 35 responds is the risk of damaging disclosure of commercial information about defendants. In view of the liberal discovery allowed by the federal rules, we think that this risk is also serious. We conclude that the likelihood of harm under the circumstances of this case clearly outweighs plaintiffs' interest in communicating information gleaned only from discovery materials.
Next we must ask whether a more narrowly drawn order or a less restrictive means than a protective order would effectively meet these concerns. We think it clear that they would not. First, no means other than sealing the documents produced in discovery could protect defendants' confidential commercial information.
Second, PTO 35 is reasonably narrowly drawn. Although it is an umbrella order that permits the parties to designate documents as confidential, nothing other than a blanket order can meet the manageability concerns present in a complex case. Cf. In re San Juan Paper Co., supra, Slip Op. at 117; In re Halkin, supra, 598 F.2d at 196 n.47. The order incorporates an appeals process for challenges to such designations, and by the terms of the order the burden of proving the need for confidentiality remains, as we think the Constitution requires, on the party seeking protection. In addition, the only persons restrained by the order are qualified persons, executives, and witnesses, as defined in PTO 35. We have already noted that the only communication restrained is that of information contained in documents produced under seal.
Finally, the foregoing discussion makes clear why PTO 35 is an effective means to prevent unwarranted exposure of defendants' commercial information and abuse of the court's processes, and to insure that discovery would be orderly and fair. We hold that the First Amendment does not require vacatur of PTO 35, nor does it require disclosure of more categories of documents than do the public's access rights.
Our analysis of the facts and the applicable law has led us to the conclusion that we must deny plaintiffs' motions for wholesale declassification and for vacatur of PTO 35; that we must declassify the DSS's and the text of the FPS, along with several of its appendices; and that we must refuse to declassify all other materials that were designated "confidential" under the aegis of PTO 35 and either filed of record or accumulated in discovery.
Plaintiffs' counsel have informed us that a twenty-five volume appendix to plaintiffs' appellate brief is being filed with the Clerk of the Third Circuit Court of Appeals. We believe that the vast bulk of plaintiffs' appendix filings consist of materials that are declassified; by virtue of the order accompanying this opinion. If that judgment is correct, many thousands of documents which have never been on the public record will be exposed at the moment that the Clerk of the Court of Appeals completes the docketing process. Defendants and third parties who have submitted documents in discovery in reliance on PTO 35 and whose documents will be unsealed by virtue of the accompanying order should have an opportunity to make application to the Court of Appeals for a stay and for relief from our decision.
Accordingly, we will direct the Clerk promptly to notify third parties that produced documents that are declassified by the order accompanying this opinion of the substance of this decision.
We will stay the effective date of our accompanying order until December 15, 1981.