Fourth Circuit Shines Light on Company Doe – Litigation Record Ordered Unsealed



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by Chris Soverow, Conference Producer at ACI

On April 16, 2014, the Fourth Circuit issued a landmark decision ordering that the record of Company Doe v. Tenenbaum, et al. before the District of Maryland be unsealed in its entirety.

By way of background, Company Doe brought suit to enjoin the Consumer Product Safety Commission (CPSC) from publishing a report that contained materially inaccurate information to its website.  The CPSC offered multiple drafts of the report with various edits, including redacting material that the CPSC agreed was materially inaccurate, but Company Doe maintained its objections and that publication of the report would result in reputational and financial harm to the company.  Based on the concern over reputational harm from publication via the CPSC website or the court’s own record, Company Doe brought suit, and moved that the record be sealed and it be permitted to pursue its claims under a pseudonym.  The Honorable Alexander Williams, Jr., ruling on the very first challenge to the CPSC’s publication authority granted by the Consumer Product Safety Improvement Act (CPSIA), agreed with Company Doe, sealed the record and permitted the use of the pseudonym, and ultimately granted the injunction.  Judge Williams reasoned that publication of a report with materially inaccurate information would result in harm to the company, and permitting public access to the record and the company’s identity would obviate the very relief Company Doe sought be bringing suit.

Various consumer groups joined together to attempt to intervene in the action and appeal the sealing and pseudonymity orders.  In the end, the Fourth Circuit agreed with the consumer groups that the public interest in the judicial process, stemming from either the First Amendment or common law, exceeded Company Doe’s, the majority held, unsupported concerns of potential financial or reputational harm.[1]  In so holding, the Fourth Circuit made several significant findings:

1. the Consumer Groups’ right to access judicial documents exceeded Company Doe’s  interest in preventing reputational or financial harm;

2. publication via the courts does not undermine Company Doe’s injunctive relief or otherwise weaken any statutory right; and

3. the risk of further exposure to the public will not deter future companies from litigating “pre-publication challenges to the [CPSC’s] online database”.

Former Chairman Inez Tenenbaum and Cary Silverstein, a partner at Shook Hardy LLP who was involved with the appellate proceedings, will discuss the implications of this ruling, as well as other issues pertaining to the future of practicing before the CPSC, at ACI’s 2nd Annual Consumer Products Regulation and Litigation Conference on June 11-12, 2014.  To see the full agenda for the event or to register, visit the conference homepage. Prior to joining the conversation in June, you can weigh in on evaluating the propriety and effect of this watershed ruling by participating in a short survey [ ] . The results of the survey will be published and distributed, preserving participant anonymity of course.

[1] Judge Williams had the unenviable task on ruling on several issues, which will not be discussed herein, that informed lengthy appellate consideration of the Consumer Groups’ standing.