September 24, 2002

Larry W. Propes
Clerk of Court
U.S. District Court for the District of South Carolina
1845 Assembly Street
Columbia, South Carolina 29201

Re: Proposed Amendment to Local Rule 5.03;
AAJ's Support for Open Public Courts

Dear Mr. Propes:

On behalf of the 60,000 members of the American Association for Justice (AAJ), I write to convey AAJ's strong support for the Court's admirable initiatives to reduce the incidence of sealed files and secret settlements in its jurisdiction. These enhancements of the public's right to know and contributions to public health and safety are of great value.

AAJ is a private bar association, most of whose members represent plaintiffs in personal injury, civil rights, employment, and environmental litigation; the defense in criminal cases; and either side in business and family litigation.

Secrecy in our state and federal courts undermines every American's right to know. Secrecy denies American families vital health and safety information, and leads to needless injuries and deaths. American courts are public institutions and must operate under the presumption of openness. Secrecy is the antithesis of American justice. The United States Constitution requires open courts.

AAJ applauds the court's August 2001 action creating (through its Local Rule 5.03) a presumption against sealing documents and imposing strict requirements on the process by which documents might be sealed. The court now proposes appropriately to amend Local Rule 5.03 to clarify that settlement agreements filed with the court also will not be sealed.

Rather than comment specifically on the court's proposed addition of a section "c" to Local Rule 503, I would like to comment on the critical need to reduce secrecy in all our courts and on the several arguments that are frequently made against attempts to do so.
AAJ Stands Against Court Secrecy

AAJ supports the concept of open courts. Civil litigation is not merely the private property of those in litigation. It affects the health and safety, ultimately, of all Americans. It is the people's business.

Accordingly, AAJ has long opposed all forms of secrecy in litigation unless a judge finds a compelling, specifically determined reason to deny the public access. In 1989, AAJ's Board of Governors adopted a resolution encouraging courts to limit or prohibit secret proceedings and agreements, require particularized proof in the limited circumstances in which secrecy is justified, and look favorably on petitions to change secrecy agreements.

Our resolution called on attorneys to resist requests for secrecy agreements that could impair anyone's future access to justice or reduce the effectiveness of public safety agencies. A copy of our resolution is attached. We have also published a significant body of information about court secrecy on the AAJ website, at http://www.AAJnet.org/secrecy.

We believe an effective approach to the problem of secrecy should not only tell judges and attorneys what they must not do, but should also tell them what they should do. A rule-based approach should provide guidance to judges on how to weigh competing interests, e.g. legitimate privacy rights v. the public's right to be safe from hazards that are sometimes hidden by those who create them. It should also provide guidance to lawyers on both sides as to what they can expect courts to do – both to resolve the competing interests of parties and to protect the public against hidden dangers.

Competing Arguments on Court Secrecy

For more than ten years, frequent defense demands for sealed files and secret settlements have sparked a struggle over secrecy in litigation and what it means for public health and safety. AAJ has closely monitored this struggle and the trends in court responses to it. In doing so, we have observed several phenomena: (1) the ever-increasing desire of tort defendants for secrecy even under the most questionable circumstances; (2) the continual discovery of sealed files and confidentiality agreements that have obscured or hidden outright the facts behind serious hazards to the public (the recent examples of the Ford/Firestone cases and, especially, the reprehensible practice of concealing clergy abuse stand out); (3) the slow but steady growth in the number of federal and state judges, courts, and entire court systems that have resolved not to allow secrecy practices to become "business as usual" in their courts, but to have a presumption in favor of openness; and (4) the entirely predictable support for and opposition to attempts like those of your court to limit secrecy.

Any court contemplating restrictions on secrecy must expect to receive arguments both for and against its proposed action. There are some reasonable arguments on both sides, and they do not always contradict each other. The sealing of files in divorce and adoption cases, for instance, may be appropriate. But, in evaluating the arguments overall, here are several questions the court might care to ask:

(1) Is the court hearing any complaints against its efforts from individuals or civil liberties organizations, who see the proposed anti-secrecy action as a threat to privacy or from consumer protection organizations who see it as anti-consumer?

(2) Does local law confer any "privacy" rights on corporations that are akin to the privacy rights conferred by law on individuals?

(3) Can any advocate point to a concrete, documented instance when a court refused to allow secrecy in consumer litigation, which then led directly to a competitor's misuse of proprietary business information? (Stated more flippantly, is there a company that wants to steal the secret process for making defective tires that will explode and lead to lawsuits against that company?)

(4) Can anyone demonstrate factually that, in states with limits on secrecy in litigation, the settlement rate per capita has decreased significantly since the limits were implemented?

(5) Can anyone demonstrate factually that, in states with limits on secrecy in litigation, the trial rate per capita has increased significantly since the limits were implemented?

Florida's "Sunshine in Litigation" Statute – Proof of Success

Since July 1, 1990, Florida has had a "sunshine in litigation" statute that limits secrecy in matters that involve "public hazards." Larry Stewart, a prominent Florida litigator and a former president of AAJ, was recently quoted in the Miami Daily Business Review (Dan Christensen, "Federal Judges [in Florida] Ponder Future of Secret Settlements," September 12, 2002) saying that he hasn't heard of any settlements that weren't achieved because of the effect of Florida's law, and that "this is not a big deal anymore."

The Florida legislature requires its state supreme court to maintain comprehensive statistics on court filings and dispositions in a number of different categories. The statistics are available from the Office of the State Court Administrator. I am attaching a chart that tracks the essential numbers from 1986 (before the Sunshine in Litigation Act took effect) through 1999 (the last year for which data were available).

The chart shows that the number of filings and dispositions of tort cases in Florida has varied little in that 14-year period. The crucial comparison, however, is between filings and dispositions and the growing population of the state. When tort filings and dispositions are viewed on a per capita basis, it is clear that filings have actually decreased since 1986, and that dispositions per capita have tracked filings very closely.

Florida's statutory rejection of court secrecy has not led to more litigation per capita; nor has it curtailed the number of cases that are closed.

I hope these thoughts are useful to the court as it reviews public comments on the proposed amendment to Local Rule 5.03.

Thank you for your leadership in providing sunshine in the courts for the public good.

Sincerely,

Mary E. Alexander, J.D., M.P.H.
President, American Association for Justice

Attachments: (1) AAJ Board of Governors Resolution
(2) Florida court statistics on per capita tort filings and dispositions

cc: Honorable Joseph F. Anderson,
Chief Judge, U.S. District Court, District of South Carolina
Honorable Jean H. Toal,
Chief Justice, Supreme Court of South Carolina
William Nicholson,
President, South Carolina Trial Lawyers Association
Linda Franklin,
Executive Director, South Carolina Trial Lawyers Association
Executive Committee,
American Association for Justice