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Federal Appeals Court Hears Argument Regarding Sealing of 'Company Doe' Challenge to CPSC Database Publication


Recent Happenings in APRM
November 2013

Consumer Groups Continue Push To Reveal The Identity Of "Company Doe" After CPSC Dropped The Appeal

On October 31, 2013, the United States Court of Appeals for the Fourth Circuit heard oral argument in Company Doe v. Public Citizen, No. 8:11-cv-02958. Consumer advocacy group, Public Citizen, joined by Consumer Federation of American and Consumers Union, argued to overturn aspects of a lower court ruling enjoining the U.S. Consumer Product Safety Commission (CPSC or Commission) from publishing a "materially inaccurate" incident report on its publicly available database known as Specifically, the consumer advocacy groups sought to unmask the identity of the original plaintiff company, and remove redactions from the record. 

At its inception, this lawsuit was entitled Company Doe v. Tenenbaum, naming the CPSC and its Chairwoman, in her official capacity. "Company Doe" filed suit after the Commission made a decision to publish a report on its public database about one of the company's products, despite the company providing notice and information to the CPSC indicating that the report was materially inaccurate. The plaintiff company also moved to proceed under a pseudonym, and requested that the court seal the record to protect the plaintiff from potential harm to its business and reputation that could result from association with the inaccurate report. Crowell & Moring's APRM Group previously reported about the United States District Court District of Maryland's findings in Company Doe's favor in its October 2012 APRM Newsletter.

Following the lower court ruling, the Commission initially appealed, but later dropped its appeal prior to its briefing deadline. Despite the Commission itself no longer proceeding with the case, Public Citizen and other advocacy groups continued the appeal with respect to the sealing of the case, but arguably not on the underlying merits.

During oral argument, Scott Michelman spoke on behalf of Public Citizen, characterizing this case as "unprecedented" and "secret litigation." Mr. Michelman asserted that Public Citizen and other advocacy groups had standing based on first amendment right of public access to the court process. He emphasized the idea that corporate reputation was an insufficient basis for sealing a case, urging the Court to consider only grounds such as trade secret or national security interests as sufficient. He also sought to distinguish the exclusion of information from the CPSC's database from the exclusion of information in the court record. For instance, he suggested that because the lower court had agreed that the database report was materially inaccurate, that unsealing the record now would pose no harm to a "vindicated" company. He rejected one panel judge's contention that this might be a "distinction without a difference" if the record were to be unsealed.

In contrast, Baruch Fellner spoke on behalf of Company Doe, and argued that unsealing the record at any point, even years in the future, would "shut the courthouse door to any successful challenge" to CPSC database postings by company's going forward.

Mr. Fellner emphasized the statutory basis for the exclusion of materially inaccurate information, commenting that if the CPSC had addressed the material inaccuracy of the post at issue, it would never have been made public under the statutory regime in place. The panel questioned him vigorously about the distinction between the statute's guidance for the CPSC, and the role the lower court played by sealing the record. He responded in part by emphasizing that the CPSIA did not include a participatory role, outside the CPSC, in deciding what reports would be made public.

Mr. Fellner also questioned the standing of Public Citizen and the other public advocacy groups to bring the challenge when the CPSC was no longer party to the appeal. He further suggested that the groups were seeking to attack the merits of the case under the pretense of challenging the denial of public access to the court proceedings.

No clear court leaning or decision was apparent at the close of argument. An appellate decision to unseal the case might have a chilling effect on those wishing to challenge CPSC database postings, as Company Doe's counsel argued. Certainly, if revealed, business interests will follow the resulting publicity and economic impact on Company Doe's products. In that scenario, the true impact of the pending appeal may not be known until the dust settles around Company Doe itself. If kept under seal, companies may instead feel more emboldened to challenge CPSC database reports in the future. The decision is likely weeks away, but the outcome is greatly anticipated by supporters of both sides.

To hear a recording of the argument, you may visit the Fourth Circuit's Oral Argument Archive website here.

Crowell & Moring's APRM group helped to organized an ABA panel featuring Mr. Michelman who argued appeal for Public Citizen as part of an ABA Section of Litigation - Product Liability Committee Roundtable entitled, "The CPSC's Publicly Searchable Database." A recording of the Roundtable, including discussion with Ms. Falvey, a Crowell & Moring partner, and with attorney Scott Michelman of the Public Citizen Litigation Group, is available to ABA Section of Litigation members for a free download here.

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