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Hammock by Hammock v. Hoffmann-LaRoche

August 2, 1995

MARVIN LOUIS HAMMOCK, JR., AND LEON WILSON, INFANTS, BY THEIR GUARDIAN AD LITEM, THELMA HAMMOCK, AND MARVIN LOUIS HAMMOCK, SR., INDIVIDUALLY, PLAINTIFFS,
v.
HOFFMANN-LAROCHE, INC., DEFENDANT-RESPONDENT, AND JOHN DOES 1 THROUGH 20, MARY ROES 1 THROUGH 20, RICHARD D. FOX, M.D., DERMATOLOGY-DERMATOLOGIC SURGERY, P.A., A PROFESSIONAL CORPORATION, DEFENDANTS.



On certification to the Superior Court, Appellate Division.

The opinion of the Court was delivered by Coleman, J. Chief Justice Wilentz and Justices Handler, Pollock, O'hern, Garibaldi, and Stein join in Justice COLEMAN's opinion.

The opinion of the court was delivered by: Coleman

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

MARVIN LOUIS HAMMOCK, JR., ET AL. V. HOFFMAN-LaROCHE, INC., ET AL. (A-124-94

Argued March 14, 1995 -- Decided August 2, 1995

COLEMAN, J., writing for a unanimous Court.

Thelma Hammock and her husband, Marvin, filed a medical malpractice claim against Thelma's dermatologist, and a products-liability claim against Hoffman-LaRoche (Roche). Roche manufactured and distributed the drug Accutane after it received FDA approval in May 1982. Thelma's dermatologist prescribed Accutane in May 1986 for the treatment of her severe acne. While using the drug, Thelma became pregnant and gave birth to a child with severe physical deformities and brain damage. The Hammocks alleged that Roche inadequately warned prescribing physicians of the dangers of Accutane during pregnancy.

The Hammocks sought discovery of more than 1,000 documents from Roche. Roche resisted, claiming that many of the documents sought contained trade secrets and confidential and proprietary information, or were protected from disclosure by the physician-patient privilege. Roche sought a protective order pursuant to Rule 4:10-3, which provides that for good cause shown, a court may, when Justice requires to protect a party from whom discovery is sought, order that a trade secret or other confidential research, development, or commercial information not be disclosed or be disclosed only in a designated way.

On May 18, 1989, the trial court concluded that "good cause" existed to justify the entry of a protective order sealing the documents because they contained trade secrets, confidential and proprietary information or material protected by the physician-patient privilege of persons not parties to the action. The protective order provided that the Hammocks and their attorneys, experts or consultants be prohibited from disseminating any copies of the documents to others not directly associated with the Hammocks or upon written order of the court, and that all information in whatever form discovered from the examination of the documents be used only in connection with this cause of action. Upon objection, Roche had the burden of proving that each objected to document was either a trade secret or confidential or proprietary information. One month after entry of the May 18 order, Roche was directed to make available to the Hammocks' counsel certain transcripts from other lawsuits filed against Roche. The protective order was amended to prohibit the Hammocks' attorney from conferring with attorneys in other jurisdictions with respect to Accutane litigation and from disseminating any information contained in this litigation.

The Hammocks' attorney and Roche used many of the sealed documents in connection with various motions and briefs filed with the trial court. Roche also filed two motions for summary judgment, in which counsel for the parties utilized sealed documents in support of, and in opposition to, those motions. One summary judgment motion was argued in open court.

Two non-parties moved to intervene and unseal the documents or otherwise modify the protective order as amended. One of the moving parties was Public Citizen Group, Inc. (Public Citizen), a non-profit organization that advocates safe, affordable and effective drug use. Public Citizen generally sought to secure public access to the pleadings, deposition transcripts, documents, and exhibits filed with the court and to unseal the records so it could obtain evidence useful to its petition to the FDA for a more stringent regulation of Accutane. Generally, the records Public Citizen sought to review and copy were presented to the trial court during judicial proceedings conducted on Roche's motions for summary judgment. After the products-liability action was dismissed on summary judgment, the trial court granted Public Citizen's application to intervene but denied its application to unseal the documents.

On appeal, the Appellate Division held that Public Citizen has no absolute First Amendment or common-law right of access to the documents. Nonetheless, the Appellate Division remanded the matter, directing: 1) Roche's attorneys to designate by categories the type of documents sought to be protected and the general basis for the protection; and 2) the trial court to make factual determinations about whether Roche had made a sufficient factual showing to keep the alleged proprietary and confidential information under seal.

On remand, the trial Judge created five categories to determine whether the protective order covered the documents. The court unsealed five documents but did not articulate any clear standard for determining whether to unseal documents once the litigation had been concluded. The Appellate Division affirmed.

The Supreme Court granted Public Citizen's petition for certification to establish a standard for deciding when the public should have access to judicial records in the form of documents, transcripts, and legal memoranda with attachments filed with a trial court in support of, or in opposition to, motions in civil litigation.

HELD: There is a presumption of public access to documents and materials filed with a court in connection with civil litigation. The Court establishes a reasonableness standard to guide courts in the determination of whether that presumption of access may be rebutted.

1. Under the common law, there is a presumption of public access to documents and materials filed with a court in connection with civil litigation. That rights exists as to the litigants and the public. Under the First Amendment, however, the Court does not decide whether the right extends beyond the litigants. The common-law right-of-access is not absolute; it requires a flexible balancing process, focusing on the interests of the parties. Under both the common law and the First Amendment, a court may craft a protective order. The strong common-law presumption of access must be balanced against the factors militating against access. The person who seeks to overcome the presumption of access has the burden of demonstrating that the interest in secrecy outweighs the presumption. Documents containing trade secrets, confidential business information and privileged information may be protected from disclosure. Therefore, under the Court's supervisory power and pursuant to Rule 1:1-2, the Court establishes a reasonableness standard to determine whether the presumption of access may be rebutted. (pp. 11-24)

2. There is a profound public interest when matters of health, safety and consumer fraud are involved. Thus, as a matter of public policy, there must be careful scrutiny prior to sealing records and documents filed with the court in a high public-interest case. The court adopts a broad standing rule affording the public access to court files when health, safety and consumer fraud are involved; standing should not be limited to the parties or their attorneys. The standard the Court establishes today recognizes that there must continue to be confidentiality of materials submitted in the discovery process. Moreover, there is no change in the existing public policy of maintaining confidentiality in certain matters, either private or confidential, in which the government's interests outweighs the presumption of access. (pp. 24-30)

3. The following standard should guide trial courts in deciding applications made pursuant to Rule 1:2-1 and 4:10-3. This standard should be followed whether access is sought by a party or a non-party for the purpose of making available to the public sealed documents and materials filed with the court in connection with nondiscovery applications. First, there is no presumptive right-of-public-access to discovery motions filed with the trial court; however, summary judgment motions are presumptively assertible. Second, the presumption of public access attaches to pretrial-nondiscovery motions, whether preliminary or dispositive, and the materials, briefs and documents filed with courts in support of, or in opposition to such motions. Third, the presumption attaches to all materials, documents, legal memoranda or other papers "filed" with the court that are relevant to any material issues involved in the underlying litigation regardless of whether the trial court relied on them in reaching its decision on the merits. Fourth, the presumption of access applies regardless of whether the non-discovery motion that has caused the documents to be filed with the court is granted or denied. Fifth, a flexible balancing process adaptable to different circumstances must be conducted to determine whether the need for secrecy substantially outweighs the presumption of access. Sixth, the person who seeks to overcome the strong presumption of access must establish by a preponderance of the evidence that the interest in secrecy outweighs the presumption. Seventh, the person with the burden of proof must demonstrate evidence to show why public access to the document should be denied currently rather than rely on the fact that a protective order was entered earlier. Eighth, the trial court, or special master, must examine each document individually and make factual findings with regard to why the presumption of public access has been overcome. The need for secrecy should extend no further than necessary to protect the confidentiality and documents should be redacted when possible. (pp. 30-34)

4. Application of this standard leads the Court to reverse in this case. The record on remand is insufficient to permit the Court to decide whether good cause existed, in accordance with the standard adopted, to deny public access to the documents. (pp. 34-39)

Judgment of the Appellate Division is REVERSED. The matter is REMANDED to the Law Division for redetermination consistent with this opinion.

CHIEF JUSTICE WILENTZ and JUSTICES HANDLER, POLLOCK, O'HERN, GARIBALDI and STEIN join in JUSTICE COLEMAN's opinion.

The opinion of the Court was delivered by

COLEMAN, J.

This case requires us to decide whether the public has a right of access to judicial records and materials filed with the court in civil litigation. Public Citizen Group, Inc. (Public Citizen), a non-profit organization that advocates safe, affordable and effective drugs, sought access to documents filed with the trial court under a protective order in a pharmaceutical manufacturer products-liability case. After the products-liability case was dismissed on summary judgment, the trial court denied Public Citizen access to the documents and materials filed with the court with respect to preDisposition-nondiscovery motions. The Appellate Division remanded the matter to the trial court for redetermination. 269 N.J. Super. 289 (1993). On remand, the trial court did not unseal the records and the Appellate Division affirmed in an unpublished opinion.

We granted certification, 139 N.J. 288 (1994), to establish a standard for deciding when the public should have access to judicial records in the form of documents, transcripts and legal memoranda with attachments filed with a trial court in support of, or in opposition to, motions in civil litigation. We reverse and remand for redetermination in accordance with the standard established today.

I.

A

This case has a protracted procedural history spanning seven years. It began when Thelma Hammock filed a medical malpractice claim against her attending physician, Dr. Jose Fishman, a dermatologist, and a products-liability claim against Hoffman-LaRoche (Roche). Roche manufactured and distributed the drug Accutane after it received Food and Drug Administration (FDA) approval in May 1982. Plaintiff's attending physician prescribed Accutane in May 1986 for the treatment of her severe recalcitrant cystic acne. During her use of the drug, plaintiff became pregnant, and gave birth to a child with severe physical deformities and brain damage.

Plaintiff's theory of products liability was alleged inadequacy of warning to prescribing physicians such as Dr. Fishman. The warning was allegedly inadequate because it did not advise prescribing physicians to obtain blood-pregnancy tests. The medical-malpractice claim against Dr. Fishman was based on negligence in prescribing Accutane during plaintiff's pregnancy.

Plaintiff sought discovery of more than 1,000 documents from Roche pursuant to Rule 4:10-1 and -2. Roche resisted, contending that many of the documents sought contained trade secrets and confidential and proprietary information, or were protected from disclosure by the physician-patient privilege.

Roche filed a motion for a protective order pursuant to Rule 4:10-3. It submitted affidavits of Doctor George S. Vadnai and Donald Hollander who explained that some of the information sought was essential to the filing with the FDA of an Investigational New Drug (IND) or New Drug Application (NDA) for Accutane. INDs and NDAs are the documents required by the FDA for a pharmaceutical company to obtain approval to market a prescription drug. FDA regulations provide that data contained in an IND or NDA file is not subject to public disclosure. See 21 C.F.R. § 20.111(d).

On May 18, 1989, the trial court concluded that "good cause" existed under Rule 4:10-3(g) justifying the entry of a protective order sealing the documents. The finding of good cause was based on the court's Conclusion that many of the documents "may contain trade secrets, confidential and proprietary information and material protected by the physician-patient privilege of persons who are not parties to this action." The protective order controlled the dissemination of Roche documents by providing:

(2) Plaintiffs, their attorneys, or any experts or consultants retained by them, are prohibited from disseminating, in any fashion, manner or method, copies of the documents thereof, to any other person, firm or organization, not directly associated with plaintiffs or upon further written order of this court; * * * (5) All information in whatever form, discovered from examination of said documents shall be used only in connection with this action; * * * (11) If a party objects to the designation by Roche of any documents as containing trade secrets, proprietary or confidential information, the party shall (within 60 days of receipt of such documents) identify each document it wishes to remove from the provisions of this Order . . . Roche shall have the burden of proving that such documents contain trade secrets or other confidential and proprietary information.

Within a month after entry of the May 18 order, the trial court directed Roche to make available to plaintiff's counsel certain transcripts from other lawsuits filed against Roche. The protective order was amended to prohibit plaintiff's counsel from conferring with attorneys in other jurisdictions with respect to Accutane litigation and from disseminating any information obtained in the present litigation.

It is undisputed that counsel for plaintiff and Roche used many of the documents in connection with various motions and briefs filed with the trial court. It was always understood by counsel for the parties that documents attached to motions or references to them in the briefs were subject to the May 18, 1989, protective order as amended.

B

Roche filed two motions for summary judgment, and counsel for the parties utilized documents placed under seal in support of, and in opposition to, those motions. The trial court denied one motion on June 29, 1990, and thereafter also denied a motion for reconsideration. On February 29, 1991, a different Judge granted partial summary judgment to Roche.

After full discovery, Roche again moved for summary judgment seeking dismissal of the products-liability claim on October 25, 1991. By that time, a different trial Judge was presiding over the matter. To support its renewed application, Roche relied on testimony of plaintiff's expert and Dr. Fishman, as well as the prescribing information available for Accutane in May 1986. In opposition to the motion, plaintiff submitted hundreds of pages of Roche's documents and deposition transcripts, some of which were referred to in the briefs. Those voluminous submissions included transcripts, confidential marketing information, proprietary business materials and privileged medical information about other birth defect cases in which Accutane had been ingested during pregnancy.

The trial court conducted oral argument on May 14, 1992. Roche convinced the trial court that in May 1986 its warning informed Dr. Fishman, and other physicians prescribing Accutane, of the drug's potential to cause birth defects through Roche's "Black Box" warning specifically approved by the FDA. The trial court granted summary judgment dismissing the products-liability case based on the learned-intermediary rule codified by N.J.S.A. 2A:58C-4. See Niemiera by Niemiera v. Schneider, 114 N.J. 550, 559, 555 A.2d 1112 (1989); Strumph v. Schering Corp., 256 N.J. Super. 309, 315, 606 A.2d 1140 (App. Div. 1992), rev'd on Dissent, 133 N.J. 33 (1993). Plaintiff then settled with Dr. Fishman. The Appellate Division affirmed the summary judgment, and the Court denied certification. 134 N.J. 561 (1993).

C

Just prior to dismissal of the products liability case, two motions were made by nonparties to intervene, pursuant to Rule 4:33-2, and unseal the documents or otherwise modify the protective order as amended. The first of those motions was made on April 7, 1992, by counsel for plaintiffs in two other Accutane lawsuits to obtain pleadings, deposition transcripts and any attached exhibits and documents. The second motion was made on April 16, 1992, by Public Citizen. It generally sought to secure public access to the pleadings, deposition transcripts, documents and exhibits filed with the court and to unseal the records so it could obtain evidence that might shed light on the hazards posed by Accutane. Public Citizen had petitioned the FDA for more stringent regulation of Accutane, and it wanted this information to support that petition.

In June 1992 the trial court determined that counsel for plaintiffs in the two Accutane lawsuits could have access to the Roche documents as well as deposition transcripts. The court required counsel to be bound by the protective order as amended on July 17, 1992. On the same date the trial court also granted Public Citizen's application to intervene but denied its application to unseal the documents.

The trial court directed Roche to review the documents and specifically inform the court which documents Roche believed contained proprietary, trade secret or privileged information. In response, Roche made an application to continue the protective order with respect to approximately 221 documents it identified as falling into either of three protected general categories. At the Conclusion of a hearing conducted on November 2, 1992, the trial court found that forty of the 221 documents should be unsealed and the remaining 181 documents should remain under seal.

In Public Citizen's appeal, the Appellate Division held that Public Citizen has no absolute First Amendment or common-law right of access to the documents. 269 N.J. Super. at 297. The Appellate Division relied on Matter of Krynicki, 983 F.2d 74, 78 (7th Cir. 1992), in holding that "confidentiality orders entered by other [Judges] had to be followed," and that documents under seal submitted to the court in connection with motions that "were irrelevant to the merits of the lawsuit" can be kept secret. Hammock, supra, 269 N.J. Super. at 298. Because the trial court made no factual findings, either when it entered the protective order on May 18, 1989, or on November 2, 1992, when Roche sought to keep the documents under seal, the Appellate Division remanded the matter for two purposes. First, the remand directed Roche's attorney to designate by categories "the type of documents sought to be protected and the general basis for the protection." Id. at 299. Second, it required the trial court to make factual determinations about whether Roche had made "a sufficient factual showing to keep its alleged proprietary and confidential information" under seal. Id. at 300.

The trial court conducted a hearing on remand on June 16, 1994. The Judge stated that he had for a second time made an in camera inspection of each document. During that hearing, counsel for Public Citizen conceded that "in the event that documents were placed into the record solely for the purpose of evading the Protective Order, those materials would not be subject to the presumption of public access." He disagreed, however, that it was bad faith for plaintiff's counsel to submit, in opposition to Roche's first summary judgment motion, documents that had been used successfully to defeat that motion. He argued that the records and documents were used in briefs submitted to a different Judge, to create a factual issue with respect to the adequacy of the warning.

The second Judge rejected Public Citizen's argument, explaining that when he considered a document to have been submitted in bad faith, it was because of plaintiff's counsel's repeated submissions of the documents in support of an invalid legal theory. The Judge perceived the legal theory to be invalid because Roche had informed physicians prescribing Accutane that it could cause defects in a fetus. Plaintiff, nonetheless, insisted that Roche had a duty to inform prescribing physicians of the exact methodology they should use ...


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