February 7, 2001

 

 

The Honorable Neil H. Shuster

Mercer County Civil Courts Building

175 South Broad Street

Trenton, New Jersey 08650

 

Re:            Frankl, et al. v. Goodyear Tire & Rubber Co., et al.

Docket No. MER-L-003052-99                              

 

Dear Judge Shuster:

 

On behalf of Consumers for Auto Reliability and Safety (“CARS”), please accept this Reply in letter form in lieu of a more formal reply to the amicus Brief filed by the Washington Legal Foundation (“WLF”) in opposition to the Motions to Vacate or Modify the Protective Order filed by CARS and by the L.A. Times and L.A. Daily News.   WLF does not contest CARS’ Motion to Intervene.  Its amicus Brief, however, purports to contest both the legal arguments advanced by CARS and those advanced by the media intervenors, without distinguishing between them.  In this Reply, CARS addresses only those aspects of WLF’s Brief that could arguably be viewed as responsive to issues raised by CARS’ Brief in Support of its Motion to Vacate or Modify the Protective Order (“CARS’ Br.”).[1]

 

First, we must emphasize the arguments relevant to CARS’ Brief that WLF does not make.  Specifically, WLF does not challenge any of the substantive arguments CARS advanced in support of its Motion to Vacate or Modify the Protective Order.  For example, CARS’ initial and reply Briefs demonstrated that Goodyear has never shown, and cannot now show, that there is good cause under R. 4:10-3 to warrant either the umbrella protective order or the secrecy of the thirty-three discovery documents that Plaintiffs challenge as non-confidential.  WLF does not attempt to argue that Goodyear has made, or can make, the requisite good-cause showing.  Similarly, as stated in CARS’ earlier Briefs, if the umbrella protective order is not vacated in its entirety, then Paragraph Five must be modified because it violates the common law right of access by authorizing the wholesale sealing of all pleadings.  CARS also argued that Paragraph Six should be modified to include a restriction on the destruction of documents.  WLF does not contest either of these points.

 

Instead of addressing the substantive arguments presented in CARS’ Briefs, WLF’s amicus Brief focuses on peripheral issues and advances novel, meritless theories.  CARS will address those contentions to the extent that they could arguably be viewed as relevant to CARS’ arguments. 

 

1.                  The Public Interest in the Safety of Goodyear’s Tires is Significant.

 

In our previous Briefs, CARS established that there is significant public interest in determining whether the Goodyear light truck tires are unsafe.  Like Goodyear, however, WLF attempts to minimize the public interest in this case, relegating its discussion to a footnote.  See WLF Br., at 11 n.6.  WLF challenges the public interest here on the ground that CARS has produced no evidence that there are “any safety problems” connected with Goodyear’s tires and because “federal regulation fully vindicates the public’s interest in obtaining safety information about tires.”  Id.  Both assertions are misguided.

 

First, CARS does not have to produce any evidence that Goodyear’s tires are actually defective to show that the public interest here is grave.  See Public Citizen v. Liggett Grp., Inc. 858 F.2d 775, 787 (1st Cir. 1988), cert. denied, 109 S. Ct. 838 (1989).  Indeed, to require the public to prove that a product is dangerous before it can obtain access to evidence regarding that issue contradicts common sense, as well as New Jersey law.  The entire purpose of CARS’ Motion is to seek access to documents that would help the public determine whether Goodyear’s tires present a danger to the motoring public.  As the New Jersey Supreme Court stated in  Hammock by Hammock v. Hoffmann‑LaRoche, 142 N.J. 356, 379 (1995), “[T]here is a profound public interest when matters of health, safety and consumer fraud are involved.”  Hammock involved allegedly dangerous prescription drugs.  The public interest in this case, which involves allegedly dangerous tires, is at least as strong.

 

Second, despite WLF’s assertion, there plainly is evidence of a safety problem with Goodyear’s tires.  In fact, Goodyear engineers themselves have acknowledged “an ‘alarming’ problem with the tires.”  See CARS’ Br., at Exh. C.  In addition, Plaintiffs’ counsel has produced evidence of at least nine accidents involving tread separation of the same tires, which caused more than five deaths and fourteen other serious injuries.  See CARS’ Br., at Exh. A (letter from Plaintiff’s counsel regarding multiple deaths and significant injuries involved in tire tread separation accidents).  Moreover, the National Highway and Traffic Safety Association (“NHTSA”) recently opened a preliminary evaluation, after it received reports of thirty-one crashes involving the same tires, in which fifteen people died and 129 were injured.  See Power, Stephen and Aeppel, Timothy, “U.S. Probes Goodyear Light-Truck Tires”, Wall St. J., Nov. 22, 2000, p. A10 (attached as Exhibit A).   This development is highly significant.  As a former senior enforcement attorney for NHTSA commented:  “The body of evidence on Goodyear must be pretty compelling if during this extraordinary time, when the agency is overwhelmed [by the Firestone investigation], . . . [they] open[ed] a new investigation.  I can’t imagine NHTSA opening up such a large investigation without significant concern.”  Fix, Janet, “Goodyear Tires Being Investigated: Complaints of failure looked at by NHTSA”, Detroit Free Press, Nov. 22, 2000 (attached as Exhibit B).

 

Finally, contrary to WLF’s assertion, while NHTSA’s actions are significant, they are insufficient to protect the public interest.  The Firestone tire debacle provides a particularly relevant example.  NHTSA’s long period of inaction regarding the separation of Firestone tire treads, 6.9 million of which were ultimately recalled, has been well documented.  See, e.g., New York Times Magazine, Dec. 17, 2000, at 52-53 (describing NHTSA’s failure to act after the nation’s largest insurance company warned it about a pattern of wrecks connected with Firestone tires, and its further inertia even after Ford began voluntarily replacing defective tires).  In fact, NHTSA’s overall performance regarding tire safety is notoriously poor.  See, e.g., id. at 50-53 (“NHTSA is understaffed, slow to react, unreliable and the captive of all sorts of political agendas . . . .”).  Members of Congress have publicly recognized the inadequacy of NHTSA’s response to tire tread separation problems.  Id., at 52-53 (“One of the few things Democrats and Republicans agreed about during congressional hearings this fall was how pathetically the agency performed during the Firestone-Explorer crisis.”).   In the instant case, despite receiving multiple complaints regarding Goodyear Load Range E tires, NHTSA did not open a preliminary evaluation until after this case was filed and the media raised interest in the safety of the tires.  See “U.S. Probes Goodyear Light-Truck Tires”, Wall St. J., Nov. 22, 2000, p. A10.  The public interest in learning the truth about Goodyear’s tires could hardly be stronger.

 

2.             The Umbrella Protective Order Violates the Common-Law Right of Access.

 

In Section III of its amicus Brief, WLF argues that the common law right of access to public records does not extend to all documents filed with the Court.  WLF Br., at 8.  This argument does not contradict CARS’ assertions.  Rather, CARS’ argument under the common law pertained to pretrial nondiscovery documents.  As stated in CARS’ earlier Briefs, if the umbrella protective order is not vacated in its entirety, then Paragraph Five should be modified to comport with the common-law presumption of access to pretrial nondiscovery documents. Currently, the provision in Paragraph Five authorizing the wholesale sealing of all documents, including pretrial nondiscovery documents, violates Hammock’s articulation of the common law right of access.  See CARS’ Br., at 15-16.

 

WLF appears to concede this point.  It recognizes Hammock’s holding that the common-law presumption of access attaches to pretrial nondiscovery documents.  WLF Br., at 9.  However, WLF then misstates the law by claiming that Hammock further held that the common-law right can never apply to trade secrets.  WLF Br., at 9 n.4.  This incorrect characterization of  Hammock is based on a portion of a sentence taken out of context.  Read in full, the sentence cited by WLF merely holds that documents containing trade secrets “may” be protected from disclosure.  142 N.J. at 376.  This statement is entirely consistent with CARS’ arguments. 

 

3.              Pursuant to R. 4:10-3, the Umbrella Protective Order Should Be Vacated and the Public Should Have Access to the Thirty-Three Contested Discovery Documents.

 

1.                  CARS Has “Standing” to Seek Public Access under R. 4:10-3.

 

In Section IV of its amicus Brief, WLF does not contend that there is good cause for secrecy under R. 4:10-3, but instead asserts that CARS has no standing to make a challenge under this Rule.  WLF Br., at 11-12.  This argument is meritless.  As the First Circuit stated:  “Courts, including this one, routinely have found that third parties have standing to assert their claim of access to documents in a judicial proceeding.” Public Citizen, 858 F.2d at 787 (citing In re Alexander Grant & Co. Litigation, 820 F.2d 352, 354 (11th Cir. 1987)); Anderson v. Cryovac, Inc., 805 F.2d 1 (1st Cir. 1986); In re Globe Newspaper Co., 729 F.2d 47, 50 n.2 (1st Cir. 1984)), cert. denied, 488 U.S. 1030 (1989)). 

 

While New Jersey courts have not directly addressed WLF’s standing argument, federal courts have regularly rejected similar arguments regarding Federal Rule of Civil Procedure 26(c), the federal counterpart to R. 4:10-3.[2]  Federal rulings are legion that third parties may assert access claims on the basis of whether sufficient good cause has been established to issue a protective order.  Public Citizen, 858 F.2d at 787-90 (“Rule 26(c) thus lends support to the right of access claimed by [intervenor] . . . .”  ); San Jose Mercury News, Inc. v. United States District Court, 187 F.3d 1096, 1103 (9th Cir. 1999) (“[A] nonparty may seek permissive intervention in order to test whether the ‘good cause’ requirements . . . have been met . . . .” ) (citing Beckman Indus. Inc. v. International Ins. Co., 966 F.2d 470, 473, 476 (9th Cir. 1992) (affirming district court’s granting intervenor’s motion to modify protective order based on good-cause challenge)); Pansy v. Borough of Strousburg, 23 F.3d 772, 783-92 (3rd Cir. 1994) (determining standard for intervenor-newspaper’s motion to modify protective order on ground of good cause); In re “Agent Orange” Prod. Liab. Lit., 821 F.2d 139 (2d Cir.) (affirming district court’s granting intervenor’s motion to unseal discovery materials pursuant to Federal Rules of Civil Procedure), cert. denied, 484 U.S. 953 (1987).  WLF cites no precedent for its argument to the contrary. 

 

Moreover, in this case, CARS has a clear basis for standing to seek relief under R. 4:10-3, because its rights will be affected by whether secrecy continues in this case.  The relief CARS seeks is for the Court to vacate or modify the Protective Order.  Plaintiffs will most likely share information with CARS if the Court grants this relief.  In a similar case, the First Circuit found this factor significant in determining that the intervenor had standing:  “Because obtaining a modification of the protective order will, as a practical matter, guarantee [the intervenor’s] access to documents in the plaintiffs’ possession, [the intervenor] has standing to seek the modification.”  Public Citizen, 858 F.2d at 787 n.12 (noting that plaintiffs objected to protective order and indicated they would disseminate documents if permitted).  Here, similarly to Public Citizen, Plaintiffs have objected to the Protective Order, and have already shared their concern about the safety of Goodyear tires with CARS’ counsel.  See CARS’ Br., at Exh. A (Plaintiffs’ counsel’s letter to Arthur Bryant, Oct. 13, 2000).

 

Consistent with these federal cases, Hammock clearly foresaw that third parties would challenge protective orders pursuant to the good-cause standard under R. 4:10-3, and indicated that such challenges would be proper.  In Hammock, the court established guidelines for deciding third parties’ challenges to protective orders.  Hammock 142 N.J. at 380 (“The standard we adopt should be followed whether access is sought by a party or nonparty . . . .”).  In that section of the opinion, the court also made reference in dicta to third-party good-cause challenges.  Id., at 380.  Thus, Hammock recognized the right of third parties to challenge whether parties have met the good-cause standard for protective orders.  This Court should not abridge that right. 

 

As a matter of public policy, moreover, Hammock held that there should be a broad standing rule to allow third parties to challenge protective orders in cases involving public safety.  Id. at 379.  This Court recently echoed this public policy during a hearing concerning propulsid litigation.  Regarding a motion for a blanket secrecy order over confidential documents, the Court stated: 

 

. . . [N]or do I see the support for a blanket secrecy order. . . . And I have an obligation in addition to the counsels [sic] who are before me to protect the public on . . . an issue of public health. And I’m not tying [documents] up on a secrecy agreement and I’m not playing cloak and dagger because it’s economically efficient. . . . I am not going into a secrecy agreement where there’s a potential of a public health issue. . . .  What would my justification be as a . . . public . . . official, as a servant of the people to sit and put things under cloak?

 

In Re:  Propulsid, N.J. Super. Ct., Case Code 247, December 1, 2000, Tr. at 54-55 (attached as Exhibit C).  The instant case similarly involves a public safety issue.  Consistent with Hammock and other state and federal decisions, this Court should hold that CARS has standing to challenge whether good cause for secrecy was shown under R. 4:10-3. 

                     

b.             The Umbrella Protective Order Should be Vacated Under R. 4:10-3.

 

WLF does not contend that good cause for the entry of the umbrella protective order has been shown under R. 4:10-3.  Instead, it states that it would be “impractical in any case, such as this one, involving large numbers of documents,” to require Goodyear to prove good cause for keeping any specific documents secret.  Therefore, WLF reasons, Goodyear should simply continue to unilaterally designate documents as confidential.  WLF Br. at 10.  Although WLF cites Pansy v. Borough of Stroudsburgh, 23 F. 3d 772, 787 n. 17 (3d Cir. 1994), in support of this argument, Pansy in fact stands for the opposite proposition.  This is clear from the very sentence WLF cites from this opinion:  “[T]he court may construct a broad umbrella protective order upon a threshold showing by the movant of good cause.” Id. (emphasis added).  Here, no such showing has been made.

 

WLF’s next argument is that vacating the umbrella protective order in this case “would completely eliminate all protective orders”.  WLF Br. at 10.  WLF states that courts should routinely issue protective orders that presumptively keep secret any documents that a party designates as confidential, until the documents have been “introduced at trial or in connection with a dispositive motion.” WLF Br. at 10, 12.  This argument eschews both the law and the facts.

 

WLF’s argument ignores the law because it essentially reads the good-cause requirement out of R. 4:10-3.  The plain language of the Rule states that parties must show good cause before a court may issue a protective order.  This Court is not free to disregard that legal requirement on the ground that, according to WLF, “there is little to recommend” it.  WLF Br. at 12.

 

WLF’s argument also ignores the facts, because there is no reason that legitimate umbrella protective orders in other cases would be imperiled by a decision to vacate the umbrella order here because R. 4:10-3 has not been satisfied.  CARS’ motion to vacate the protective order here is based on factors specific to this case:  Goodyear’s failure to make a threshold showing of good cause, the significant public safety issues involved, the public’s recently-heightened concerns about the dangers of tire tread separation, and Goodyear’s insistence on keeping secret even mundane documents, such as its Response to CARS’ initial Brief, which do not arguably contain proprietary information or trade secrets.  See CARS’ Br., 10-15, 17-22; CARS’ Reply Br., 6-7.  All of-these factors are tailored to the facts of this case, and warrant the Court’s vacating the blanket Protective Order.[3] 

 

4.  Vacating the Umbrella Protective Order Would Not Constitute a Taking.

 

In the final section of its amicus Brief, WLF asserts the novel, tentative argument that this Court should “err on the side of caution” and decline to vacate the umbrella protective order because setting aside the Protective Order “may” constitute a taking under the Fifth Amendment.  WLF Br. at 14.  To follow WLF’s urging would, in fact, constitute error. WLF cites no judicial precedent for its argument, for which there is no legal basis. 

 

It is well-established that trial courts have the authority to modify or lift protective orders.  See United States v. Swift & Co., 286 U.S. 106, 114-15 (1932) (regarding injunction, even if power to modify was not expressly provided, “power there still would be by force of principles inherent in the jurisdiction of chancery”), cited by Public Citizen, 858 F.2d at 780-82 (holding that the issuing court has inherent power to modify discovery-related protective orders). Moreover, the plain language of R. 4:10-3 clearly establishes that trade secrets do not enjoy automatic court-ordered protection from disclosure.  Instead, as stated above, the Rule requires parties to prove good cause.  See CARS’ Br., 10-11, 18-20.  In addition, even if good cause is shown, the Rule provides courts with discretion in issuing protective orders.  Id. (stating that court “may” order trade secrets not to be disclosed).  As detailed in CARS’ initial Brief, courts must weigh the interests in secrecy against those in disclosure to determine whether to issue a protective order regarding documents containing trade secrets.  See CARS’ Br., 20-21.  WLF’s argument would effectively overturn both the Rule’s good-cause requirement and its bestowal of discretion upon courts to decide whether to issue protective orders regarding trade secrets. 

 

Case law further undermines WLF’s insinuation that courts must issue protective orders preventing access to trade secrets.  In contrast to WLF’s argument, the New Jersey Supreme Court has determined that even after finding good cause, courts must engage in a “flexible balancing process . . . to determine whether the need for secrecy substantially outweighs the presumption of access.”  Hammock, 142 N.J. at 381.  There is no exception for trade secrets under this analysis.  Federal Open Market Comm. V. Merrill, 443 U.S. 340 (1979) (holding that “there is no absolute privilege for trade secrets and similar confidential information”, quoting 8 C. Wright & A. Miller, Federal Practice and Procedure § 2043).  As the Court of Appeals for the District of Columbia recently held:  “The courts have not given trade secrets automatic and complete immunity against disclosure, but have in each case weighed their claim to privacy against the need for disclosure.” United States v. Microsoft Corp., 165 F.3d 952, 959 (D.C. Cir. 1999) (citing Adv. Comm. Note, 28 U.S.C. App., p. 715, and federal cases); accord Andrew Corp. v. Rossi, 180 F.R.D. 338, 341 (N.D. Ill. 1998) (“With respect to the claim of confidential business information, this standard demands that the company prove that disclosure will result in a ‘clearly defined and very serious injury’ to its business.”) (citations omitted).[4]

 

Finally, WLF’s takings argument is premised on the incorrect assumption that vacating the umbrella protective order would automatically disclose Goodyear’s trade secrets.  Goodyear, however, could still seek protective orders regarding particular documents if it could prove that those documents contained legitimate trade secrets.  The Court would then make individualized determinations about whether the interest in secrecy outweighed the interests in public disclosure.  See Hammock, 142 N.J. at 381.  Moreover, by using this procedure, the Court could more easily comply with Hammock’s recommendation that courts redact only those portions of the document that contain trade secrets.  See id., at 382 (“Documents should be redacted when possible . . . .”).  Thus, if the Protective Order were vacated, the parties would merely follow routine procedure for protecting individual documents pursuant to R. 4:10-3.  That procedure is more appropriate in this case than the current blanket Protective Order, which CARS respectfully requests the Court to vacate. 

 

Respectfully submitted,

 

 

 

 

 


[1] The confusion created by WLF’s failure to distinguish between CARS’ arguments and those advanced by the media intervenors is compounded by the fact that WLF’s Brief contains no citations whatsoever to CARS’ Brief.  Instead, WLF’s Brief incorrectly suggests that all of the arguments it is addressing were raised by all intervenors.  Compare, e.g., WLF Br., Section II, at 5-7 (attributing First Amendment argument to all intervenors) with CARS’ Reply Br., at 6 n.4 (expressly stating that CARS has not asserted First Amendment arguments).  In this Reply, we will not address Sections I or II of WLF’s Brief, as they address matters irrelevant to CARS.

[2] As noted in CARS’ earlier Briefs, New Jersey courts routinely turn to the federal courts for assistance in interpreting the rule.  Hammock, 142 N.J. at 369 (noting the purposes of the federal and state rules are “substantially the same”); Kerr v. Able Sanitary and Envtl. Servs., Inc., 295 N.J. Super. 147, 156 (N.J. Super. Ct. App. Div. 1996)  (“Because Rule 4:10-3 follows the text of Fed. R. Civ. P. 26(c), federal decisions construing the corresponding federal rule offer some insight into the issue.”) (citing Hammock).

[3]  WLF also fails to challenge CARS’ argument regarding access to the thirty-three discovery documents Plaintiffs contest as non-confidential.  As CARS stated in its initial Brief, these documents should be make publicly accessible under R. 4:10-3.  Goodyear has failed to state good cause for keeping these documents secret, and the public interest outweighs Goodyear’s interest in secrecy.  See CARS’ Br., 9-15, 17-23.

 

[4] Moreover, Goodyear cannot meet the standard elements of a takings claim.  If the Court deems it necessary, CARS respectfully requests the opportunity to more fully address this aspect of the takings argument.