On Petition for Writ of Mandamus of Prohibition (Related to D.C. Civ. No. 83-2864) (No. 85-3423). On Petition for Writ of Mandamus of Prohibition (Related to D.C. Civ. No. 84-0678) (No. 85-3424). On Appeal from the United States District Court for the District of New Jersey (D.C. Civ. No. 83-2864) (No. 85-5529). On Appeal from the United States District Court for the District of New Jersey (D.C. Civ. No. 84-0678) (No. 85-5530).
Before: HIGGINBOTHAM, BECKER, STAPLETON, Circuit Judges.
These appeals require us to apply the principles and case law construing Fed. R. Civ. P. 26(c) to a claim that certain materials obtained in civil discovery but alleged by the producing party to be confidential may be disclosed by the discovering party to the public. We must also consider whether we have appellate jurisdiction over the district court's interlocutory order permitting disclosure of the materials.
The appeal arises form two of the several cases nationwide in which cigarette smokers or their personal representatives have instituted product liability suits against tobacco companies. In both cases, the parties had already engaged in extensive discovery, including production of a very large number of documents by defendants, when the defendants sought protective orders that would prevent the dissemination of any other documents they had produced or would produce during discovery either to the public or to counsel in other similar cases.*fn1 A federal magistrate entered identical protective orders in both cases along the lines requested by the defendants.
On appeal from the magistrate's orders, the district court substantially revised them. The court altered the procedure that the magistrate's orders had established for deciding disputed claims of confidentiality, and restricted the orders' scope so that release of the documents to the press and public would have followed almost as of course but for this appeal. The revised orders also permitted the documents to be used in other cases in which plaintiffs' counsel was the counsel of record.
The defendants thereupon appealed to this Court and petitioned for mandamus, asserting that the revised orders violated Fed. R. Civ. P. 26(c) and reflected a skewed reading of Seattle Times Co. v. Rhinehart, 467 U.S. 20, 104 S. Ct. 2199, 81 L. Ed. 2d 17 (1984). The defendants also moved for an expedited appeal and a stay of the district court's orders, as well as reinstatement of the magistrate's orders, pending appeal. We granted those motions. The plaintiffs moved to dismiss the appeals for want of appellate jurisdiction, and also moved to dismiss the petition for mandamus.
We hold that: (1) we do not have jurisdiction to review the order pursuant to the collateral order doctrine as enunciated in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 93 L. Ed. 1528, 69 S. Ct. 1221 (1949); (2) we do have mandamus jurisdiction to review the order pursuant to 28 U.S.C. § 1651 (1982); (3) because the district court's reading of Seattle Times constituted a clear error of law, the ruling on the defendant's motion for protective orders was incorrect; and (4) the district court also clearly erred in relying on Bose Corp. v. Consumers Union of United States, Inc., 466 U.S. 485, 104 S. Ct. 1949, 80 L. Ed. 2d 502 (1984) to exercise plenary review of the magistrate's protective order, for the court was bound to apply a "clearly erroneous" standard. We therefore grant the writ of mandamus. To assist the district court on remand, we discuss two additional points relevant to this case: the definition of "good cause," and the administration of protective order proceedings.
A. The Institution of the Suits
Rose Cipollone and her husband Antonio filed a complaint against Liggett Group, Inc., Phillip Morris, Inc., and Loew's Theaters, Inc., all manufacturers of cigarettes,*fn2 in the district court for the District of New Jersey on August 1, 1983. Jurisdiction was based on diversity of citizenship, 28 U.S.C. § 1332 (1982). The complaint alleged that defendants manufactured or sold cigarettes and that Rose Cipollone had smoked defendants' cigarettes for almost forty years. As a result of her smoking, the complaint alleged, she acquired bronchogenic carcinoma and other personal injuries; it further alleged that she had experienced severe pain and suffering and that her illness had caused her -- and would continue to cause -- great expense. Plaintiffs sought compensation for Rose Cipollone's injuries, suing under theories of negligence and strict liability. Central to plaintiffs' case was their allegation that defendants had withheld scientific evidence form the public and had misrepresented the effects upon health of smoking cigarettes. They also sought compensation for Antonio Cipollone's loss of consortium.
Shortly thereafter, Susan Haines as administratrix and prosequendum and executrix of the Estate of Peter F. Rossi brought suit in the same court against the same three defendants as well as R.J. Reynolds Tobacco Co. and the Tobacco Institute, Inc. Haines was represented by the same attorney who represented the Cipollones. Jurisdiction was based on diversity, and once again the complaint alleged tortious conduct sounding in strict liability and negligence. The complaint also included an allegation of misrepresentation. The plaintiff sought compensation for the decedent's pain and suffering and for his death, which she alleged was the result of his smoking defendants' cigarettes.
B. The Initial Protective Order
The district court ordered discovery in both cases under the supervision of a federal magistrate. 28 U.S.C. § 636(b)(1)(A) (1982). Discovery proceeded until March 1985, and a large number of documents were produced by the defendants for inspection pursuant to Fed. R. Civ. P. 34. On that date, the defendants moved for an "umbrella" protective order. The defendants argued that such an order would facilitate the discovery process by reducing the number of occasions for lawyers' conferences and discussions about the confidentiality of particular documents. Defendants also argued that they had good cause for the protective order under Fed. R. Civ. P. 26(c)*fn3 and that the closely analogous Seattle Times Co. v. Rhinehart, 467 U.S. 20, 104 S. Ct. 2199, 81 L. Ed. 2d 17 (1984), permitted a protective order in this case. Plaintiffs objected to the defendants' proposal, countering that the defendants' real purpose was to make it impossible for plaintiffs in other suits against the cigarette companies to share information gathered from the defendants. The defendants' strategy, said plaintiffs, was to raise the expense of litigation for future plaintiffs, thus making the cost of suits prohibitive.
After hearing on the matter, the magistrate found for defendants. On March 25, 1985, he entered identical protective orders in both cases. The crucial aspects of the protective orders may be summarized as follows: (a) "all information" produced in discovery, presumably confidential and nonconfidential alike, could be used only for the instant cases and not for other cases or other purposes; (b) the defendants had the responsibility in the first instance of deciding in good faith which of their documents were confidential and marking them accordingly; (c) information marked confidential could be examined as matter of course by plaintiffs' lawyer, his associates, and experts retained by plaintiffs or their lawyer for the cases; (d) if plaintiffs wished to disclose the information to anyone else, they had to inform defendants' counsel, who then had opportunity to apply to the court to prevent that disclosure; and (e) all documents and copies thereof had to be destroyed or returned at the conclusion of the litigation.*fn4
C. Plaintiffs' Appeal to the District Court
Plaintiffs appealed the protective order to the district court, arguing that the order violated plaintiffs' first amendment rights to disseminate the information that they had received through discovery. Plaintiffs relied on Seattle Times, supra, arguing that the defendants and the magistrate had misconstrued the Supreme Court's holding in that case. They also argued that the defendants had failed to demonstrate good cause as required for a protective order by Fed. R. Civ. P. 26(c).
The district court filed a lengthy opinion, covering its scope of review of the magistrate's decision, the meaning and relevance of Seattle Times, the notion of "good cause" in Fed. R. Civ. P. 26(c), and the proper scope of the protective order. Disposition of the appeal requires that we describe each part of the district court's opinion in some detail.
1. The District Court's Scope of Review of the Magistrate's Protective Order
Although 28 U.S.C. § 636(b)(1)(A) states that a magistrate's order is not to be reconsidered unless it is "clearly erroneous or contrary to law,"*fn5 the district court ruled that its standard of review was plenary, relying on Bose Corp. v. Consumers Union of the United States, Inc., 466 U.S. 485, 104 S. Ct. 1949, 80 L. Ed. 2d 502 (1984), which held that an appellate court has plenary review over the finding of actual malice in libel cases. See Dist. Ct. Op. at A17-A18.*fn6
2. The District Court's Analysis of Seattle Times
The district court next engaged in a lengthy first amendment analysis of protective orders in discovery. It reviewed the conflicting approaches of the circuit courts prior to Seattle Times*fn7 and then observed that Seattle Times had resolved the issue. The court ...