日历第935号第110届国会报告参议院第二次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-439次会议第110-43法案（第2449条）提交给司法委员会，修订《美国法典》第28编第111章，涉及保护令、案件封存、民事诉讼中披露披露信息，以及出于其他目的，并对其进行了审议，报告对此表示赞同，并提出修正案，建议经修正的法案通过。内容页一、2008年《阳光诉讼法》的背景和目的2.1。法案历史和委员会审议情况13 III.法案逐节摘要15 IV.国会预算办公室成本估算17 V.监管影响评估18 VI。结论18七。如报告所述，法案对现行法律进行了修改……….18 I.《2008年阳光诉讼法》的背景和目的《阳光诉讼法》第2449条的目的是保护公众免受限制信息披露的法院命令经常ReportsReports掩盖的潜在健康或安全危险。该法案要求法官在签发保护令或密封法庭记录或和解协议的命令之前，考虑公众对健康和安全信息的披露的兴趣。根据本条例草案，该命令的支持者必须证明该命令不会限制披露与保护公众健康和安全有关的信息。如果该命令将限制披露，则法官必须在发布该命令之前，发现公众对潜在健康或安全危害的利益大于对保密的具体和实质性利益。该法案还禁止法院批准或执行当事人之间或当事人之间协议的任何条款，该条款限制当事人向任何联邦或州机构披露与诉讼相关的公共健康或安全信息，该机构有权执行监管此类信息相关活动的法律。此外本条例草案禁止法院执行和解协议中禁止披露公众健康或安全信息的任何条款，除非法院发现公众在披露潜在健康或安全危害方面的利益被维持该协议的具体和实质利益所压倒信息的保密性。许多消费者权益保护组织和公开政府组织支持S.2449，因为它将保护合法的保密利益，同时确保法院认可的保密不会因为向消费者和监管机构隐瞒潜在的公共健康或安全危险信息而危害公共福利代理机构。---------------------------------------------------------------\《诉讼中的阳光法案》：法院保密是否会损害公众健康和安全？：在小组委员会前进行听证。美国司法部反垄断、竞争政策和消费者权利委员会，第110届丛书（2007年12月11日）[以下简称2007年听证会]（提交新闻自由记者委员会备案）；全国消费者联盟、正义与民主中心、消费者联盟、美国消费者联合会、全国消费者权益倡导者协会、政府问责项目、处于危险中的儿童、公众公民和美国PIRG给参议员赫伯·科尔的信（2008年3月4日）。该法案也得到了《纽约时报》的认可。社论，需要知道，纽约时报，2008年3月12日，http://www.nytimes.com/2008/03/12/opinion/12wed3.html？scp=3&sq=%22need+to+Know%22&st=nyt（上次访问时间为2008年4月10日）。-------------------------------------------------------------这项立法将在颁布之日后30天生效，仅适用于在该日或之后签订的民事诉讼命令或协议。《诉讼中的阳光法案》并不意味着先发制人或取代现行法律、联邦民事诉讼规则、普通法或第一修正案，除非该法律可能提供更大的公开性和对诉讼文件、法院记录或诉讼程序的访问。此外，这项立法并不意味着排除公众在限制信息披露方面的其他利益，如金融欺诈或环境损害。法庭保密使公众无法了解公共健康和安全危险。在过去的20年中，我们了解到许多案件，法院以保护令和密封套的形式批准了保密tlements, has kept the public in the dark about serious public health and safety dangers. At hearings in 1990 and 1994, the Judiciary Committee's Subcommittee on Courts and Administrative Practice heard testimony about some of the many examples of these cases such as those involving complications from silicone breast implants, adverse reactions to a prescription pain killer, ``park to reverse'' problems in pickup trucks, and defective heart valves. Other examples include cases involving dangers from side-saddle gas tanks, playground equipment, IUD birth control devices, tires and portable cribs. In December 2007, the Judiciary Committee's Subcommittee on Antitrust, Competition Policy and Consumer Rights received testimony about more recent examples, including Phenylpropanolamine (PPA) in children's over-the-counter medicine, Cooper tires and the prescription drug Zyprexa. This problem most often arises in product liability cases. Typically, an individual sues a manufacturer for an injury or death that has resulted from a defect in one of the manufacturer's products. In these cases, the victim generally faces a large corporation that can spend large sums of money defending the lawsuit and prolonging its resolution. Facing a formidable opponent and mounting medical bills, plaintiffs are discouraged from continuing and often seek to settle the litigation. In exchange for monetary damages, the victim is often forced to agree to a provision that prohibits him or her from revealing information disclosed during the case. While the plaintiff gets a respectable award and the defendant is able to keep damaging information from being publicized, the public remains unaware of critical health and safety information that could potentially save lives. In some of the examples cited, the civil complaint and other court records may have been available to the public. However, this publicity is minimal and not sufficient to notify the public and regulatory agencies or to prevent additional injuries.\2\ In cases involving dangerous products, often it is the ``smoking gun'' documents, uncovered during discovery and sealed in settlement agreements, that will adequately inform the public and regulators about a health or safety danger. As a result, it takes the public and regulators much longer than it should have to discover dangers to health and safety. Furthermore, in most cases, defendants continue to insist on secrecy even after some information has become public.\3\ --------------------------------------------------------------------------- \2\2007 Hearing (testimony and responses to questions by Judge Anderson). \3\According to Bruce Kaster, a lawyer who has represented clients in cases against Cooper Tire, Cooper still aggressively fights for protective orders despite the fact that there is some publicity about the cases. --------------------------------------------------------------------------- A. EXAMPLES OF COURT SECRECY 1. Zomax The popular painkiller Zomax, manufactured by McNeil Pharmaceuticals and linked to a dozen deaths and more than 400 severe allergic reactions, was taken off the market only after McNeil settled dozens of lawsuits with sealed settlements. In 1990, Devra Lee Davis testified before the Subcommittee on Courts and Administrative Practice about how she nearly died from taking this legally prescribed drug. She later learned that the company had known that the drug could kill some people and used judicially sanctioned secrecy to keep the information from the public and from others injured by the drug.\4\ --------------------------------------------------------------------------- \4\Examining the Use of Secrecy and Confidentiality of Documents by Courts in Civil Cases: Hearing Before the Subcomm. on Courts and Administrative Practice of the S. Comm. on the Judiciary, 101st Cong. (May 17, 1990) [hereinafter 1990 Hearing] (testimony of Devra Davis Lee); Davan Maharaj, Tire Recall Fuels Drive to Bar Secret Settlements, LA Times, September 10, 2000, at A1. --------------------------------------------------------------------------- 2. Zyprexa In 2005, the drug company Eli Lilly settled 8,000 cases related to Zyprexa, a drug used to treat schizophrenia and bipolar disorder. These cases alleged that Eli Lilly did not disclose known harmful side effects of Zyprexa, such as inordinate weight gain and dangerously high blood sugar levels that sometimes resulted in diabetes. Eli Lilly was also accused of promoting off label use of the drug by urging doctors to prescribe it to elderly patients with dementia. All of the settlements required plaintiffs to agree ``not to communicate, publish or cause to be published * * * any statement * * * concerning the specific events, facts or circumstances giving rise to [their] claims.'' The public did not learn about these settlements or Zyprexa's dangerous side effects until two years later, in 2006, when The New York Times was leaked documents from the case that were subject to a protective order.\5\ --------------------------------------------------------------------------- \5\Alex Berenson, Drug Files Show Maker Promoted Unapproved Use, NY Times, Dec. 18, 2006, http://www.nytimes.com/2006/12/18/business/ 18drug.html?scp=10&sq=zyprexa&st=nyt (last visited Apr. 10, 2008); Alex Berenson, Lilly Settles With 18,000 Over Zyprexa, NY Times, Jan. 5, 2007, http://query.nytimes.com/gst/ fullpage.html?res=9F00E5DB1430F936A35752 C0A9619C8B63&sec=&spon=&pagewanted=print (last visited Apr. 10, 2008). --------------------------------------------------------------------------- 3. Phenylpropanolamine (PPA) In 1996, a seven-year-old boy in Washington State suffered a sudden stroke and fell into a coma hours after taking an over-the-counter medicine used to treat an ear infection. After three years in a coma, he died. The child's mother sued the manufacturer of the medicine alleging that the stroke was induced by PPA, an ingredient with deadly potential side effects, which has since been banned by the FDA. Unknown to the public, many similar lawsuits in State and Federal courts had previously been filed against the drug manufacturer, but were settled secretly, with the lawyers and plaintiffs subject to restrictive confidentiality orders. In 2005, the mother settled her case and agreed to keep the information she learned and terms of the settlement secret.\6\ --------------------------------------------------------------------------- \6\Second Amended Complaint, Estate of Matthew Walker v. Whitehall- Robins, No. 0105-05204 (filed Or. Cir. Ct., Oct. 26, 1999); Interview with Leslie O'Leary, attorney for the Estate of Matthew Walker. --------------------------------------------------------------------------- 4. Bjork-Shiley heart valve Over the course of several years, Pfizer's Bjork-Shiley heart valves were linked to 248 deaths. Pfizer insisted on secrecy agreements in settling dozens of lawsuits before the FDA finally removed the valves from the market. The Subcommittee on Courts and Administrative Practice heard testimony from Frederick Barbee about how court-endorsed secrecy prevented him and his wife from learning about the potential heart valve malfunction and ultimately prevented her from getting the appropriate and life-saving treatment she needed when her valve malfunctioned.\7\ --------------------------------------------------------------------------- \7\1990 Hearing (testimony of Frederick R. Barbee); Davan Maharaj, supra note 4. --------------------------------------------------------------------------- 5. Dalkon Shield In 1974, the FDA suspended use of the Dalkon Shield, a popular intrauterine birth control device. The device was linked to 11 deaths and 209 cases of spontaneous abortion. Prior to the FDA's action, it was reported that the maker of the device, A.H. Robins, had settled numerous cases with strict confidentiality agreements. The manufacturer even attempted to include agreements with the plaintiffs' lawyers that would have prohibited them from taking another Dalkon Shield-related case.\8\ --------------------------------------------------------------------------- \8\Maharaj, supra note 4. --------------------------------------------------------------------------- 6. Silicone breast implants Information about the hazards of silicone breast implants was discovered during litigation as early as 1984, but because of a protective order that was issued when the case settled, the information remained hidden from the public and the FDA. It was not until several years and tens of thousands of victims later that the public learned of potentially grave risks posed by the implants. The Subcommittee on Administration and the Courts heard testimony from Sybil Niden Goldrich about her injuries allegedly caused by silicone breast implants and how the use of protective orders prevented the public from learning about the risks posed by breast implants.\9\ --------------------------------------------------------------------------- \9\S. 1404: Hearing Before the Subcomm. on Courts and Administrative Practice of the S. Comm. on the Judiciary, 101st Cong. (Apr. 20, 1994) [hereinafter 1994 Hearing] (testimony of Sybil Niden Goldrich). --------------------------------------------------------------------------- 7. Ephedra Ephedra is a supplement that was widely popular until it was banned by the FDA in 2004. The ban may have come earlier and lives may have been saved had it not been for court endorsed secrecy through protective orders and confidential settlements. Deaths related to ephedra occurred as early as 1994. The existence of 14,700 consumer complaints about Metabolife 356, and other documents relating to the safety risks of ephedra, although turned over in lawsuits against the company, were concealed by protective orders and confidential settlements. In 2000, the FDA tried unsuccessfully to intervene in a consumer lawsuit to gain access to the complaints which were under seal in a protective order.\10\ It took significant public attention and a congressional investigation for Metabolife to finally agree to provide the FDA and Congress the adverse event reports. The investigation revealed that prior to 1999, Metabolife had 138 reports of significant adverse events, including heart attacks, strokes, seizures, and psychosis.\11\ --------------------------------------------------------------------------- \10\In Bloom vs. Metabolife, the FDA sought to intervene in order to challenge a protective order that concealed health and safety information. Penni Crabtree, Court orders often keep companies' darkest secrets hidden, San Diego Union Tribune, Sept. 8, 2002, H-1; Dr. Lester Crawford discusses the Justice Department and FDA investigation of Metabolife for its use of ephedra in its diet supplement, National Public Radio (NPR) August 16, 2002. \11\Adverse Event Reports from Metabolife, Minority Staff Report, Special Investigations Division, Committee on Government Reform, U.S. House of Representatives. Oct. 2002. http://oversight.house.gov/ documents/20040827102309-56026.pdf (last visited Apr. 10, 2008). --------------------------------------------------------------------------- 8. ``Park-to-Reverse'' malfunction For many years, Ford was aware of problems associated with a ``park-to-reverse'' malfunction in its pickup trucks and quietly settled cases stemming from this alleged defect. It was not until several years later that Ford made a minimal effort to notify original owners by sending stickers alerting them that there was a problem. The stickers made no mention of the potential risks of serious injury or death. Unfortunately, 2.7 million of these truck owners did not receive the warning. One victim of the alleged defect was Tom Schmidt. His parents, Leonard and Arleen Schmidt testified before the Subcommittee on Courts and Administrative Practice. During their lawsuit they learned that Ford had known about the problem as early as 1970 and for many years, Ford had quietly settled cases with strict protective orders concealing information about the problem.\12\ --------------------------------------------------------------------------- \12\1994 Hearing (testimony of Leonard and Arleen Schmidt); Maharaj, supra note 4. --------------------------------------------------------------------------- 9. Side-Saddle gas tanks Over the course of several years, General Motors quietly settled more than 200 cases brought by victims of fiery car crashes involving the automaker's side-mounted gas tanks before the defect came to light. It was not until 1993, when General Motors sued Ralph Nader and the Center for Auto Safety for defamation, that lawyers discovered records showing that General Motors had been sued in approximately 245 individual gas tank pickup cases. The earliest cases had been filed as far back as 1973. Almost all cases were settled and almost all of the settlements required the plaintiffs to keep the information they discovered secret.\13\ --------------------------------------------------------------------------- \13\2007 Hearing (testimony of Richard Zitrin); Maharaj, supra note 4. --------------------------------------------------------------------------- 10. Bridgestone/Firestone tires From 1992 to 2000, accidents caused by tread separations of Bridgestone and Firestone tires resulted in more than 250 deaths and 800 injuries. Over the course of several years, Firestone quietly settled lawsuits relating to the tread separation, most of which included secrecy agreements. It was not until 1999, when a Houston public television station broke the story, that the company acknowledged its wrongdoing and recalled 6.5 million tires.\14\ --------------------------------------------------------------------------- \14\Richard Zitrin, The Judicial Function: Justice Between the Parties, Or a Broader Legal Interest?, 32 Hofstra L. REV. 1573, 1567 (2004); Maharaj, supra note 4. --------------------------------------------------------------------------- 11. Cooper tires In 2002, Johnny Bradley's wife was killed, and he and his son were injured, in a Ford Explorer rollover accident. The accident was allegedly caused by tread separation in the SUV's Cooper tires. While litigating the case, Mr. Bradley's attorney uncovered Cooper Tire documents that showed Cooper tires were prone to tread separation because of design defects. These documents had been kept secret through protective orders in numerous cases prior to the Bradley's car accident. In Mr. Bradley's case against Ford and Cooper Tire, the jury found that Ford was not liable for the accident. Before the trial proceeded to the claims against Cooper, the claims were dropped and the parties involved agreed to settle with almost all litigation documents remaining confidential under a broad protective order. Mr. Bradley and his lawyer, familiar with the documents and unable to speak about the details due to protective orders, believe that if the documents were made public Cooper Tire would be forced to fix the tread separation problem.\15\ --------------------------------------------------------------------------- \15\2007 Hearing (testimony of Johnny Bradley, Jr.). --------------------------------------------------------------------------- 12. All-Terrain vehicles (ATVs) While the Consumer Product Safety Commission (CPSC) has long publicized information about ATV safety and maintained a reporting system for collecting data about injuries and deaths, it has not taken action on many alleged design and manufacturing defects. There continue to be cases filed in State and Federal courts about manufacturing and product design defects in ATVs. The defendants routinely obtain protective orders to keep information secret and plaintiffs often settle before trial. In a case filed in the Central District of Illinois, K.V. vs. Kawasaki, the plaintiffs objected to the protective order sought by the defendants. In this case, a young boy was injured when his ATV flipped over in a corn field. The corn stalks protected him from being crushed, but the oil vent lacked a simple mechanism to prevent boiling hot oil from leaking out and severely burning 25 percent of the boy's body.\16\ --------------------------------------------------------------------------- \16\200 U.S. Dist. Ct. Motions 615230; 2006 U.S. Dist. Cot. Motions Lexis 45118; Interview with Daniel Pope, Phebus & Koester, Oct. 22, 2007. --------------------------------------------------------------------------- Opposing the protective order, the plaintiff argued that the defendant did not substantiate its claim that trade secrets satisfied the ``good cause'' showing, required under Rule 26(c) of the Federal Rules of Civil Procedure. The plaintiff also claimed that the health and safety risks of ATVs, well documented by the CPSC and the American Association of Pediatrics, justified rejecting the protective order because it would conceal information about the alleged defect. According to the plaintiff's attorney, the judge simply issued the protective order without opinion or written findings in response to the plaintiff's arguments. The case settled shortly thereafter. If this information were in the public domain, the boy's attorney believes that the information he uncovered during the lawsuit would either increase pressure on ATV makers to make their products safer or pressure the CPSC to investigate and take action in response to the defects. 13. Playground equipment Miracle Recreation Company manufactured and sold a piece of playground equipment called Bounce Around the World. Dozens of lawsuits were brought against the company alleging that it was dangerous and caused serious injuries to young children, including severed limbs and crushed bones. For 13 years, the public and regulatory agencies remained in the dark about the potentially crippling equipment because the company insisted on settling lawsuits conditioned by confidentiality agreements. Approximately 80 children between the ages of four and five were seriously injured before the CPSC learned about the magnitude of the danger and the company recalled the merry-go- rounds. Following the recall, the Department of Justice charged Miracle Recreation in a civil suit with failing to reveal reports of injuries to dozens of children.\17\ --------------------------------------------------------------------------- \17\Barry Meier, Legal Merry-Go-Round; Case Highlights Lack of Data Sharing, Newsday, June 5, 1998 at 3. --------------------------------------------------------------------------- 14. Portable cribs In May 1998, 16-month-old Danny Keysar was strangled to death at his licensed childcare facility when a Playskool ``Travel-Lite'' portable crib collapsed, trapping his neck in the ``V'' of its folded rails. Danny's parents sued the crib manufacturers, Kolcraft. During discovery, they learned that three prior lawsuits involving the same product defect had been settled secretly. Kolcraft offered Danny's parents a settlement, but only on the condition that they agreed to a secrecy provision. The parents would not accept a settlement that mandated their silence. Despite intense pressure to agree to a secret settlement, on the eve of trial, the parties reached a non-secret $3 million settlement agreement.\18\ --------------------------------------------------------------------------- \18\Jonathan Eig, How Danny Died, CHICAGO, Nov. 1998, http:// www.kidsindanger.org/news/news_detail/1998_chicmag.pdf (last visited Apr. 10, 2008); Danny's story on the Kids in Danger website at http:// www.kidsindanger.org/pressroom/releases/20011206_pr.pdf (last visited Apr. 10, 2008). --------------------------------------------------------------------------- B. CIVIL SUITS UNCOVER EARLY DANGERS Civil law suits are often a critical first source of information about dangerous products.\19\ For example, in a class action case against Eli Lilly related to harmful side- effects of their drug Zyprexa, lawyers uncovered documents that showed Eli Lilly knew of Zyprexa's side effects and did not adequately warn doctors or consumers. This lawsuit uncovered information that the FDA did not have access to and did not know about until information was leaked to the New York Times.\20\ Had this information been available to the public sooner, consumers would have been able to make an informed decision about the benefits and risks of taking Zyprexa. --------------------------------------------------------------------------- \19\Catherine T. Struve, The FDA and the Tort System: Postmarketing Surveillance, Compensation, and the Role of Litigation, 5 Yale J. Health Pol'y L. & Ethics 587, 664 (2005); Wendy Wagner, When All Else Fails: Regulating Risky Products Through Tort Litigation, 95 Geo. L.J. 693, 695-696 (2007), ``. . . the tort system plays an indispensable role in supplementing agency regulation of risky products and activities. In consumer and health protection, for example, the tort system provides both more tools and more rewards than the regulatory system for enterprising plaintiffs to uncover asymmetric information held by regulated parties regarding their products' risks.'' \20\Berenson, supra n, 4. --------------------------------------------------------------------------- Victims who suffer injuries related to a consumer product often promptly report their injuries to the CPSC or other relevant regulatory agencies. However, victims tend to learn specific information about a product defect later, during the course of a lawsuit. By this time, they are usually bound by protective orders that prohibit disclosure of everything they learn during the course of discovery. Because of extremely restrictive confidentiality agreements, reporting this information to a regulatory agency could mean violating a court order and jeopardizing their ability to recover their losses. Furthermore, when damaging information is revealed during discovery, the company quickly and quietly settles the case with a settlement that is almost always conditioned on total confidentiality. Thus, the public and the regulatory agencies are left in the dark about a dangerous product. C. REFORM IS NEEDED TO PROTECT PUBLIC HEALTH AND SAFETY Current practices do not adequately balance public interests with interests in confidentiality. Judges are not limited in the factors they may consider when deciding protective orders. However, in the many examples cited above, it is clear that judges do not always consider public health and safety. Judge Joseph Anderson, District Court Judge for the District of South Carolina, testifying before the Subcommittee on Antitrust, Competition Policy and Consumer Rights, acknowledged that while some judges are mindful of the court secrecy problem, many judges, facing ever increasing case loads, are ``eager to achieve speedy and concrete resolutions to their cases, and ever-mindful of the need for judicial economy, many judges all too often acquiesce to the demands for court-ordered secrecy.''\21\ --------------------------------------------------------------------------- \21\2007 Hearing (testimony of Judge Anderson). --------------------------------------------------------------------------- Leslie Bailey, a public interest lawyer with Public Justice who regularly represents clients that oppose protective orders that are against the public interest, testified that in her experience with requests for protective orders, judges, who are often managing heavy caseloads, are inclined to agree to whatever type of protection the parties agree on and easily find that to be enough good cause.\22\ --------------------------------------------------------------------------- \22\2007 Hearing (testimony of Leslie Bailey). --------------------------------------------------------------------------- Although plaintiffs may be concerned about notifying the public of a potential safety hazard, they often agree to secrecy out of perceived necessity. Leslie Bailey noted, ``A plaintiff's lawyer may be so concerned with gaining access to the key documents she needs to present her client's case that she does not recognize an unlawful protective order--or may decide it isn't worth slowing down the litigation to fight. And when faced with a settlement that will compensate their clients--especially if the defendant is willing to pay a premium for secrecy--few plaintiffs' attorneys balk at the condition that the case and the settlement be kept secret. To fight would be to delay justice for the client, or possibly to lose the chance to settle altogether, and many [clients] cannot afford that risk.''\23\ --------------------------------------------------------------------------- \23\Id. --------------------------------------------------------------------------- As a result of the differing interests of judges, plaintiffs and defendants, current litigation practices do not adequately protect the public from court-endorsed secrecy that conceals public health and safety hazards. D. CURRENT PRACTICES 1. Protective orders Under Rule 26(c) of the Federal Rules of Civil Procedure, a party or any person from whom discovery is sought may move for a protective order to keep the discovery materials confidential. The court may, for ``good cause,'' issue an order to protect a party or person from annoyance, embarrassment, oppression or undue burden or expense. Jurisdictions have extensive case law dictating what must be shown to establish ``good cause.'' The ``good cause'' standard varies widely by jurisdiction from little more than a stipulation from both the parties that the order will expedite discovery to a more rigorous showing that there is a specific need to keep the information confidential. 2. Court records Requests to seal court records or documents filed with the court are generally held to a higher standard than that required to obtain a protective order due to First Amendment law.\24\ --------------------------------------------------------------------------- \24\Nixon v. Warner Communications, Inc., 435 U.S. 589 (1978); Richmond Newspapers, Inc. v. Virginia, 448 U.S. 555 (1980); Globe Newspaper Co. v. Superior Court, 457 U.S. 596 (1982); Press Enterprise Co. v. Superior Court (Press Enterprise I), 464 U.S. 501 (1984). --------------------------------------------------------------------------- 3. Settlement agreements Under current law, there are no limitations on settlement agreements, reached privately or filed with the court, regarding the restriction of public health or safety information. As with protective orders, judges are free to consider public health and safety when deciding other orders that restrict access to information, including settlement agreements, but no such consideration is required. Parties in a civil action may choose to resolve pending litigation by agreeing to a settlement that contains a confidentiality provision sealing some or all of the discovery documents uncovered during litigation, the terms of the settlement, the fact that a settlement was reached and/or the fact that a case was ever filed. Even when not required by statute, parties may choose to seek judicial approval of a confidential settlement and file the settlement with the court in order to create a court order of confidentiality. Once a court approves the confidential settlement, the settlement is sealed away and stored by the court. Since the court retains jurisdiction over the settlement, the court can issue a contempt order against a party that violates the confidentiality order. In this situation, filing a separate lawsuit is not necessary for the court to issue a contempt order. Often, parties do not seek judicial approval of the confidential settlement, but instead agree to a private settlement that is not filed with the court. In these instances, the court docket only reveals that the action was dismissed by an agreement between the parties. These settlements are not accessible to the public. If a party to the settlement violates the settlement's confidentiality provision, a breach of contract action must be filed before the court may step in and enforce this provision. E. EFFECT OF THE LEGISLATION The legislation will not displace current practices under the Federal Rules of Civil Procedure or common law. Instead, it merely requires an additional step--consideration of public health and safety--before issuing protective orders, orders sealing court records, or settlement agreements. By creating this additional requirement, S. 2449 will ensure that court- endorsed confidentiality protection does not jeopardize the public's ability to learn about potential health or safety dangers. The bill will not burden the Federal court system. It will impact only a small subset of Federal cases, those that involve public health and safety, and judges regularly weigh competing interests in balancing tests like the one required by this bill.\25\ --------------------------------------------------------------------------- \25\2007 Hearing (testimony of Judge Anderson). --------------------------------------------------------------------------- 1. Protective orders Some judges already consider the public's interest in disclosure of public health and safety information when deciding protective orders. For those judges, the effect of this legislation will be minimal. For those who do not, S. 2449 simply requires them make such a consideration. The vast majority of cases in the Federal court system have no bearing on the protection of public health and safety. In these cases, where it is clear that a protective order would not restrict the disclosure of information relevant to protecting public health or safety, the parties can simply certify to the judge that this is the case. Therefore, in most cases, judges will be able to issue the order without making a significant inquiry based on S. 2449. In the relatively small number of cases that do involve public health and safety, and where a judge finds that such an order would restrict disclosure of information relevant to protecting the public, the judge will have to weigh interests in disclosure with interests in confidentiality. According to S. 2449, a judge may only issue the order after making findings of fact that the public interest in disclosure of potential health or safety hazards is outweighed by a specific and substantial interest in maintaining the confidentiality of the information or records in question. Under this balancing test, judges will be required to make a more detailed inquiry. This additional step required for obtaining a protective order will not overburden judges. First, the balancing test will only be required in a limited number of cases. Second, S. 2449 places the burden of proof on the proponent of the order. It will be their responsibility to summarize and distill the information that would be subject to the protective order. As Judge Anderson told the Subcommittee on Antitrust, Competition Policy and Consumer Rights, judges regularly engage in balancing tests like the one required in S. 2449.\26\ Finally, judges can use magistrate judges and special masters to assist them in more complex cases. --------------------------------------------------------------------------- \26\Id. --------------------------------------------------------------------------- The bill recognizes that there are appropriate uses for protective orders, such as protecting trade secrets. It makes sure that such information is protected by giving judges discretion to consider any confidentiality interests that are important to the proponent. Furthermore, the bill does not limit judges' existing obligations under current law and practice to protect information that truly deserves confidentiality. The legislation strongly protects trade secrets and it is expected that judges, as they are already required to do, will give ample consideration to them as part of the balancing test. However, when a party claims that they need a protective order because of a trade secret, they must demonstrate that their interest in protecting the trade secret is not outweighed by the public's interest in disclosure of a public health or safety hazard. In other words, this bill does not permit so- called trade secrets that pose a threat to public health and safety--such as a defective tire design--to justify court- endorsed secrecy. A protective order entered as a result of the balancing test shall be no broader than necessary to protect the privacy interest asserted. For example, when a party or parties request a protective order for a trade secret, the judge should only protect the materials that refer to the actual trade secret. If the items sought to be protected contain information about a potential public health or safety hazard, then, to the extent possible, the order shall only cover the trade secret and not other information about the potential hazard. As a result, a blanket protective order over all materials exchanged during discovery cannot be justified by a claim that it deserves protection because of a trade secret or other interest in confidentiality. 2. Court records The bill requires judges to take an additional step when considering the existing jurisdictional First Amendment law dictating when court records may be sealed. The bill does not purport to replace existing law interpreting the First Amendment. Instead, it creates an additional reason for openness when public health or safety is at issue. 3. Settlement agreements The legislation requires judges to apply the provisions in subsection (a)(1) prior to approving of or sealing a settlement agreement. As with protective orders, if the settlement agreement would restrict disclosure of information relevant to protecting public health or safety, such as requiring the destruction of documents or prohibiting a plaintiff from discussing potential public health or safety dangers related to his or her case, the judge must apply the balancing test in subsection (a)(1)(B) to determine if the public's interest in disclosure is outweighed by a specific and substantial interest in confidentiality. Under subsection (c), S. 2449 will also impact settlements involving public health or safety, that otherwise would not be reviewed under subsection (a), when and if parties petition the court to enforce such settlements. For example, a case may settle privately, outside of court, before any requests for protective orders. In these cases, a settlement may be conditioned on confidentiality and as a result conceal a potential public health or safety hazard and prevent the plaintiff from disclosing any and all information about their case. A plaintiff may be prohibited from disclosing everything from the nature of their injury, to the evidence they obtained independent of the defendant, or even the very fact that they sued the defendant. Subsection (c) prevents courts from facilitating defendant's efforts to conceal public health and safety information. It says that a court shall not enforce a settlement that restricts a party's ability to discuss a settlement that impacts public health or safety. This will protect plaintiffs, who were forced into out-of-court settlement agreements with restrictive gag orders, from being hauled into court by a defendant for speaking out about their settlements involving public health or safety hazards. Subsection (c), paragraph (2) makes it clear that the potential for nonenforcement of a settlement agreement will only apply in cases that restrict the disclosure of information relevant to the protection of public health or safety. Thus, in the vast majority of cases that are not relevant to public health or safety, S. 2449 will not impact a party's ability to make or enforce confidentiality provisions in settlement agreements. As we have seen with State and Federal court rules that limit the ability to seal settlement agreements, the bill is not likely to either increase the number of cases that proceed to trial or decrease the frequency of settlements. More than 15 years ago, Florida and Texas adopted a law and court rule, respectively, that limit the ability to conceal public health and information in civil lawsuits.\27\ Critics of these measures argued that the court system would be severely disrupted because parties would no longer have the same incentives to settle their cases resulting in greater demands on trial judges. Opponents made similar claims when the Federal District Court for the District of South Carolina unanimously adopted Local Rule 5.03(c), which prohibits all sealed settlements.\28\ To date, none of these dire predictions has come to fruition. In fact, South Carolina's district courts have actually experienced a decrease in trials while cases continue to settle.\29\ --------------------------------------------------------------------------- \27\Fla. Stat. Sec. 69.081 (2000); Tex. R. Civ. Pro. 76a. \28\Symposium, Secrecy in the Courts: At the Tipping Point?, Vil. L. Rev. (2008). \29\Id. --------------------------------------------------------------------------- 4. Personally identifiable information When weighing the interest in maintaining confidentiality, it is intended that judges will use procedures they currently use to protect personally identifiable information and national security information. Should this information be at issue when a judge conducts the balancing test, subsection (d) establishes a rebuttable presumption that the interest in protecting personally identifiable information relating to financial, health or other similar information of an individual outweighs the public interest in disclosure. Although under the balancing test in subsection (a)(1), judges would be able to protect this information under current practices, this subsection is intended to clarify that S. 2449 would not compromise an individual's personally identifiable information that, in all likelihood, has no bearing on protecting public health or safety. For example, a judge may find that the public has an interest in the disclosure of medical information that describes the harmful side effects of a drug because they pose a threat to public health and safety. However, the personally identifiable information connected to that medical information will remain confidential subject to the rebuttable presumption in subsection (d). 5. Classified information Similarly, S. 2449 specifically addresses national security information in subsection (e). A rule of construction states that when weighing the interest in maintaining confidentiality under Section (a), nothing in this section shall be construed to permit, require or authorize the disclosure of classified information. Again, judges have the ability to protect this information under current law and under the balancing test in subsection (a). However, this subsection is included to make clear that S. 2449 does not alter a judge's existing obligations to issue protective orders, or orders sealing court records or settlements when classified information is at issue. II. History of the Bill and Committee Consideration A. INTRODUCTION OF THE BILL The Sunshine in Litigation Act was first introduced by Senator Kohl in the 103rd Congress as S. 1404. On April 20, 1994, the Judiciary Committee Subcommittee on Courts and Administrative Practice held a hearing, ``S. 1404, a bill to amend Chapter 111 of Title 28, United States Code, relating to protective orders, sealing of cases, disclosures of discovery information in civil actions, and for other purposes.'' On June 27, 1994, the Sunshine in Litigation Act, with some minor changes,\30\ was offered as an amendment to S. 687. On June 28, 1994, the Senate conducted a roll call vote on a motion to table the amendment.\31\ The amendment was tabled by a vote of 51 to 49. --------------------------------------------------------------------------- \30\The differences between the amendment and the bill that was reported out of Committee were: subsection (a)(1) stated, ``A court shall enter an order under rule 26(c) of the Federal Rules of Civil Procedure restricting the disclosure of information obtained through discovery or an order restricting access to court records in a civil case only after making particularized findings of fact that--''; subsection (a)(1)(B)(i) stated, ``the public interest in disclosure of potential health or safety hazards is clearly outweighed by a specific and substantial interest in maintaining the confidentiality of the information or records in question''; and the amendment did not include anything after subsection (b). \31\Vote no. 168, 103rd Congress, 2nd Session (June 28, 1994). --------------------------------------------------------------------------- The Sunshine in Litigation Act was introduced again in the 104th through 109th Congresses. Each Congress it was referred to the Committee on the Judiciary and no further action was taken. In the 110th Congress, Senator Kohl introduced S. 2449, the Sunshine in Litigation Act of 2007 on December 11, 2007. Senator Patrick Leahy (D-VT) was an original cosponsor. On January 28, 2008, Senator Lindsey Graham (R-SC) signed on as a cosponsor. B. COMMITTEE CONSIDERATION On December 11, 2007, the Senate Judiciary Committee's Subcommittee on Antitrust, Competition Policy and Consumer Rights held a hearing entitled ``The Sunshine in Litigation Act: Does Court Secrecy Undermine Public Health and Safety?'' Testimony was received from five witnesses including Johnny Bradley, Jr. and Judge Joseph Anderson, Jr., District Court Judge for the District of South Carolina. Johnny Bradley, Jr. testified about his experience as a plaintiff in a case against Cooper Tire Company related to a serious car accident that killed his wife and injured him and his son. During discovery, Mr. Bradley learned that there had been dozens of cases involving Cooper Tire that ended with confidential settlements. He told the Subcommittee that during his case, his lawyer discovered documents that demonstrate that Cooper tires pose a threat to public safety. Due to protective orders entered by the judge during the lawsuit, Mr. Bradley is unable to publicly speak about these documents. Judge Joseph Anderson testified about his views concerning the adverse consequences of court-ordered secrecy. In his experience, litigants frequently request judges ``approve'' their settlements even when the law does not require judicial approval. Specifically, judges are often asked to enter orders restricting public access to settlement information and sometimes the case history. Litigants prefer to involve the trial judge in order to ensure the court's power to enforce the confidentiality of the agreement. Judge Anderson noted that some judges already do consider public health and safety when making these decisions. But, he recognized that many judges have very large case loads and, as a result, they often agree to court-ordered secrecy with little more than mutual consent by the parties. Judge Anderson testified about cases he was directly involved in and cases he is aware of where judges have agreed to requests for court-ordered secrecy where one could reasonably argue that public interest and public safety should have required openness. Judge Anderson also testified about the success of a local rule unanimously adopted by South Carolina's District Court in 2002, which bans secret settlements. Contrary to the claims of those who opposed the rule, data indicate it has not resulted in more trials and that cases continue to settle. In fact, the number of trials has actually decreased over the past five years. Since his testimony, Judge Anderson has endorsed S. 2449, saying that it is ``carefully-crafted legislation proposes a nuanced approach that simply requires judges to employ a balancing test--weighing the need for secrecy compared to potential harm to the public--and then to make specific factual findings before entering confidentiality orders. This `balancing test' would not be a new experience: weighing competing interests is what judges do on a daily basis.''\32\ --------------------------------------------------------------------------- \32\Anderson, supra note 27. --------------------------------------------------------------------------- On March 6, 2008, the Judiciary Committee met in executive session to consider the bill. Senator Kohl offered an amendment in the nature of a substitute that made four changes to the bill. Two changes were technical. One changed the bill title to the ``Sunshine in Litigation Act of 2008.'' The other added to subsection (c) a reference to subsection (a)(1) to make clear that this provision only applies to cases involving public health and safety. The other two changes were rules of construction that make it clear that the bill does not compromise protections for classified information or personally identifiable information related to financial, health or other related information. The substitute amendment was accepted by unanimous consent. The Committee then voted to report the Sunshine in Litigation Act of 2008, with an amendment in the nature of a substitute, favorably to the Senate. The Committee proceeded by roll call vote as follows: TALLY: 12 YEAS, 6 NAYS, 1 PASS Yeas (12): Leahy (D-VT), Kennedy (D-MA), Biden (D-DE), Kohl (D-WI), Feinstein (D-CA), Feingold (D-WI), Schumer (D-NY), Durbin (D-IL), Cardin (D-MD), Whitehouse (D-RI), Grassley (R- IA), Graham (R-SC). Nays (6): Hatch (R-UT), Kyl (R-AZ), Sessions (R-AL), Cornyn (R-TX), Brownback (R-KS), Coburn (R-OK). III. Section-by-Section Summary of the Bill Section 1. Short title This section provides that the legislation may be cited as the ``Sunshine in Litigation Act of 2008.'' Section 2. Restrictions on protective orders and sealing of cases and settlements Section 2(a) amends chapter 111 of title 28 of the United States Code, by adding section 1660 to the end of chapter 111. Title 28 of the U.S. Code governs the Federal judiciary and Federal judicial procedure. Under current law, Federal courts may enter protective orders under Rule 26(c) of the Federal Rules of Civil Procedure simply by a showing that ``good cause'' for the protective order exists. The new section 1660 augments this ``good cause'' showing by requiring a court to make additional findings of fact for certain protective orders under Rule 26(c) of the Federal Rules of Civil Procedure. In the case of court records and sealed settlement agreements, the new section augments existing laws, including common law and First Amendment law, dictating the standard for sealing such items. Subsection (a), paragraph (1) requires that before entering a discovery protective order, an order restricting access to documents filed with the court, an order sealing a settlement agreement that would restrict the disclosure of such information, or an order restricting access to court records in a civil case, the court must make certain findings regarding public health and safety. Subparagraph (A) states that a judge may enter an order referenced in (a)(1) when such order would not restrict the disclosure of information which is relevant to the protection of public health and safety. Subparagraph (B), clause (i) states that in the event that a judge finds that such an order would restrict disclosure of information relevant to protecting public health and safety, the judge may only issue the order after making findings of fact that the public interest in disclosure of potential health or safety hazards is outweighed by a specific and substantial interest in maintaining the confidentiality of the information or records in question. Clause (ii) states that the protective order entered as a result of the balancing test in clause (i) shall be no broader than necessary to protect the privacy interest asserted. Paragraph (2) states that no order entered in accordance with paragraph (1), other than an order approving a settlement agreement, shall continue in effect after the entry of final judgment, unless, at the time of, or after, the court makes a separate finding of fact that the requirements of paragraph (1) have been met. Paragraph (3) states that the party who is the proponent for the entry of an order, as provided in this section, shall have the burden of proof in obtaining such an order. Paragraph (4) states that section 2 shall apply even if an order under paragraph (1) is requested--(A) by motion pursuant to Rule 26(c) of the Federal Rules of Civil Procedure; or (B) by application pursuant to stipulation of the parties. Paragraph (5), subparagraph (A) states that the provisions of this section shall not constitute grounds for withholding information in discovery that is otherwise discoverable under Rule 26 of the Federal Rules of Civil Procedure. Paragraph (5), subparagraph (B) states that no party shall request, as a condition for the production of discovery, that another party stipulate to an order that would violate this section. Subsection (b), paragraph (1) states that a court shall not approve or enforce any provision of an agreement between or among parties to a civil action, or approve or enforce an order subject to subsection (a)(1), that prohibits or otherwise restricts a party from disclosing any information relevant to such civil action to any Federal or State agency with authority to enforce laws regulating an activity relating to such information. Subsection (b), paragraph (2) states that any such information disclosed to a Federal or State agency shall be confidential to the extent provided by law. Subsection (c) paragraph (1) states that, subject to paragraph (2), a court shall not enforce any provision of a settlement agreement described under subsection (a)(1) between or among parties that prohibits one or more parties from--(A) disclosing that a settlement was reached or the terms of such a settlement, other than the amount of money paid; or (B) discussing a case, or evidence produced in the case, that involves matters related to public health or safety. Paragraph (2) states that paragraph (c)(1) does not apply if the court has made findings of fact that the public interest in the disclosure of potential public health or safety hazards is outweighed by a specific and substantial interest in maintaining the confidentiality of the information. Subsection (d) is a rule of construction which says that when weighing the interest in maintaining confidentiality under Section (a), there is rebuttable a presumption that the interest in protecting personally identifiable information relating to financial, health or other similar information of an individual outweighs the public interest in disclosure. Subsection (e) is a rule of construction which says that when weighing the interest in maintaining confidentiality under Section (a), nothing in this section shall be construed to permit, require or authorize the disclosure of classified information (as defined under section 1 of the Classified Information Procedures Act). Section 2(b) amends the table of sections or chapter 111 of title 28 of the United States Code by adding after the item relating to section 1659--``1660. Restrictions on protective orders and sealing of cases and settlements.'' Section 3. Effective date This section states that the effective date of the amendments made by this Act shall take effect 30 days after the date of enactment of this Act; and apply only to orders entered in civil actions or agreements entered into on or after such date. IV. Congressional Budget Office Cost Estimate The Committee sets forth, with respect to the bill, S. 2449, the following estimate and comparison prepared by the director of the Congressional Budget Office under section 402 of the Congressional Budget Act of 1974: March 18, 2008. Hon. Patrick J. Leahy, Chairman, Committee on the Judiciary, U.S. Senate, Washington, DC. Dear Mr. Chairman: The Congressional Budget Office has prepared the enclosed cost estimate for S. 2449, the Sunshine in Litigation Act of 2008. If you wish further details on this estimate, we will be pleased to provide them. The CBO staff contact is Leigh Angres. Sincerely, Peter R. Orszag. Enclosure. S. 2449--To amend chapter 111 of title 28, United States Code, relating to protective orders, sealing of cases, disclosures of discovery information in civil actions, and for other purposes S. 2449 would, under certain conditions, prevent federal judges from issuing protective orders restricting the use of litigation records that could influence public health or safety. The bill would take effect 30 days after enactment and would apply to protective orders in civil actions or arrangements entered on or after that date. CBO estimates that enacting S. 2449 would have no significant impact on the federal budget. The bill could alter and possibly increase the workloads of federal attorneys, court staff, and judges. CBO estimates, however, that any resulting increase in spending would total less than $500,000 a year, assuming the availability of appropriated funds. Enacting S. 2449 would not affect direct spending or revenues. S. 2449 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would not affect the budgets of state, local, or tribal governments. The CBO staff contact for this estimate is Leigh Angres. This estimate was approved by Theresa Gullo, Deputy Assistant Director for Budget Analysis. V. Regulatory Impact Evaluation In compliance with rule XXVI of the Standing Rules of the Senate, the Committee finds that no significant regulatory impact will result from the enactment of S. 2449. VI. Conclusion The Sunshine in Litigation Act of 2008, S. 2449, is a straightforward and narrowly targeted measure that will ensure that court-endorsed secrecy will not jeopardize public health and safety by concealing information about potential health or safety dangers from consumers and regulatory agencies. VII. Changes to Existing Law Made by the Bill, as Reported In compliance with paragraph 12 of rule XXVI of the Standing Rules of the Senate, changes in existing law made by S. 2449, as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, and existing law in which no change is proposed is shown in roman): 28 U.S.C. CHAPTER 111 SEC. 1660. RESTRICTIONS ON PROTECTIVE ORDERS AND SEALING OF CASES AND SETTLEMENTS. (a)(1) A court shall not enter an order under rule 26(c) of the Federal Rules of Civil Procedure restricting the disclosure of information obtained through discovery, an order approving a settlement agreement that would restrict the disclosure of such information, or an order restricting access to court records in a civil case unless the court has made findings of fact that-- (A) such order would not restrict the disclosure of information which is relevant to the protection of public health or safety; or (B)(i) the public interest in the disclosure of potential health or safety hazards is outweighed by a specific and substantial interest in maintaining the confidentiality of the information or records in question; and (ii) the requested protective order is no broader than necessary to protect the privacy interest asserted. (2) No order entered in accordance with paragraph (1), other than an order approving a settlement agreement, shall continue in effect after the entry of final judgment, unless at the time of, or after, such entry the court makes a separate finding of fact that the requirements of paragraph (1) have been met. (3) The party who is the proponent for the entry of an order, as provided under this section, shall have the burden of proof in obtaining such an order. (4) This section shall apply even if an order under paragraph (1) is requested-- (A) by motion pursuant to rule 26(c) of the Federal Rules of Civil Procedure; or (B) by application pursuant to the stipulation of the parties. (5)(A) The provisions of this section shall not constitute grounds for the withholding of information in discovery that is otherwise discoverable under rule 26 of the Federal Rules of Civil Procedure. (B) No party shall request, as a condition for the production of discovery, that another party stipulate to an order that would violate this section. (b)(1) A court shall not approve or enforce any provision of an agreement between or among parties to a civil action, or approve or enforce an order subject to subsection (a)(1), that prohibits or otherwise restricts a party from disclosing any information relevant to such civil action to any Federal or State agency with authority to enforce laws regulating an activity relating to such information. (2) Any such information disclosed to a Federal or State agency shall be confidential to the extent provided by law. (c)(1) Subject to paragraph (2), a court shall not enforce any provision of a settlement agreement between or among parties that prohibits 1 or more parties from-- (A) disclosing that a settlement was reached or the terms of such settlement, other than the amount of money paid; or (B) discussing a case, or evidence produced in the case, that involves matters related to public health or safety. (2) Paragraph (1) does not apply if the court has made findings of fact that the public interest in the disclosure of potential health or safety hazards is outweighed by a specific and substantial interest in maintaining the confidentiality of the information.