FairWarining Reports

Court Asked to Decide if Transparency Trumps Corporate Reputation in ‘Company Doe’ Case

(iStockphoto)

(iStockphoto)

Leading consumer and media organizations asked a federal appeals court today to unseal dozens of documents related to a closely watched product safety and business confidentiality dispute cloaked in extraordinary secrecy.

In a brief submitted to the 4th Circuit Court of Appeals in Richmond, Va., the consumer groups said there was no significant reason for the judicial secrecy in the case.

The complicated dispute began with a complaint filed with SaferProducts.gov, a Consumer Product Safety Commission website launched in March 2011 to let consumers report and learn about hazardous products.

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The company targeted in the complaint responded by going to court to keep the matter private on the grounds that the complaint was inaccurate and would harm its reputation. The company won an initial ruling, but then the consumer and media groups took the case to the appeals court, where the judicial transparency issue is being weighed by a three-judge panel.

As FairWarning has reported, thanks to the sealed records, closed-door hearings and a 73-page ruling with large sections blacked out, even the most basic details have been concealed. That includes the identity of the plaintiff — known only as “Company Doe” –along with its product, the incident that led to the complaint and the government agency that filed the complaint.

Adding to the mystery, the Consumer Product Safety Commission — for reasons it hasn’t disclosed — decided not to appeal the initial federal judge’s ruling blocking the posting of the complaint and allowing the company to remain anonymous.

In appealing that ruling, the consumer and media organizations called it a serious violation of the public’s right to know. They said that U.S. appeals courts “have consistently rejected the notion that protecting corporate reputation justifies sealing a case.” Their appeal deals solely with the sealed court records and not with the underlying complaint filed in the federal database.

Calling for the appeals court to make the records public are the Consumers Union, Public Citizen and the Consumer Federation of America, along with the American Civil Liberties Union, the AARP and media organizations including The New York Times, The Washington Post and National Public Radio. The media organizations, in a court filing supporting the consumer groups, said the secrecy in the case “gravely undermines public confidence in the judicial system.”

On the other hand, Company Doe’s case is supported by business groups such as the National Association of Manufacturers, the American Coatings Association and the Association of Home Appliance Manufacturers. They argue that companies targeted by product complaints submitted to the federal database have a right to confidentiality if the alleged safety defects are unverified.

“There’s a significant chance of errors or incorrect information being posted to this database,” said Cary Silverman, a lawyer representing the business groups. “Anyone can submit these reports. It can be plaintiffs’ lawyers who want to drive public opinion against a company because they have litigation against them. It can be an advocacy group that has their own agenda to try to get some sort of regulation. So there’s also potential for misuse.”

In fact, because the Consumer Product Safety Commission does not investigate every complaint filed, the database, which currently contains about 17,000 incident reports, carries with it a disclaimer: The agency “does not guarantee the accuracy, completeness, or adequacy of the contents” of the database.

Still, Scott Wolfson, a spokesman for the CPSC, said the agency takes steps “to ensure that we do not post information that is clearly inaccurate or false.”

For its part, Company Doe said in a legal filing that it had showed that the complaint filed against its product – which was blamed for harming a child — was “materially inaccurate.” To make that point, the company submitted medical evidence and an expert report to the CPSC.

According to the company’s brief, “It was later revealed that the CPSC’s own expert agreed that the new evidence established that, instead of Company Doe’s product, another ‘injury mechanism’ was responsible for the harm the child suffered.” Wolfson declined to comment on that claim.

Many legal experts say the confidentiality given to Company Doe is highly unusual. Such anonymity normally is reserved for people who want to avoid disclosing details that could embarrass or even endanger them. Otherwise, only in special circumstances, such as when national security is at stake, are so many records sealed in a court case.

The appeals court is expected to make its decision within a few months.

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About the author

Lilly Fowler is assistant editor at FairWarning.

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