In a decision that will mean public access to in excess of 15,000 pages of documents from Wal-Mart corporation, a California Appeals Court has ruled that an Alameda County Superior Court judge erred in sealing thousands of pages of documents in an employment lawsuit against the retail giant.
But at same time, the appeals court denied attorneys’ fees to the Berkeley Daily Planet, which brought the motion to inspect the Wal-Mart documents, meaning the newspaper’s legal bill for the right to look at the papers could be substantial unless this part of the opinion is overturned on appeal.
“It’s a great victory for the public,” Daily Planet attorney Dave Rosenfeld of the Weinberg, Roger & Rosenfeld firm of Alameda said. “It means that the courts can only seal documents filed in a lawsuit if they follow strict rules.”
Berkeley Daily Planet Executive Editor Becky O’Malley said that the recent trend toward excessive and unnecessary sealing of court documents in lawsuits threatens to substantially impair the public’s right to know and understand what’s going on in government and society as a whole.
“It’s the job of the press to make every effort to find out what corporations like Wal-Mart are doing, and to tell citizens about it,” she said.
Included in the documents are Wal-Mart’s labor guidelines and staffing formula, pay and incentive guidelines, “STAR” reviews and documents describing the review process, internal audit procedures, the “SMART” timekeeping system, and information concerning its employees.
Exactly what documents will be made available, and how many pages that will involve, is not known by the Daily Planet attorneys.
“We know the amount that was filed with the Appeals Court, but there are other documents involved as well that Wal-Mart will have to produce,” Rosenfeld said.
The dispute grew out of a 2001 California class-action lawsuit by Wal-Mart employees charging that the company had denied meal and rest breaks to thousands of employees (Andrea Savaglio, et al. v. Wal-Mart Stores, Inc.). As part of that lawsuit, Wal-Mart was compelled to produce company documents that were put under conditional seal by the court. Under court rules, in order to have those records permanently sealed by the court and unavailable to the public, Wal-Mart would have had to file a special motion to permanently seal the documents shortly after the documents were presented to the court. But Wal-Mart attorneys said that in 2002 it worked out an off-the-record agreement with the trial court judge that such documents would be considered permanently sealed unless one of the parties to the case filed an objection.
The Alameda County trial court kept the Wal-Mart documents sealed, but when the Berkeley Daily Planet sought the records in 2004 they had been filed, unsealed, with the Appeals Court. Wal-Mart immediately filed a motion to permanently seal the documents. In 2005, Alameda Judge Ronald Sabraw granted Wal-Mart’s motion to seal the most sensitive of the documents, but the three-judge appeals court overruled that decision in this week’s ruling.
“The [trial] court had no power under the Rules of Court to entertain a grossly untimely motion to seal,” the Appeals Court ruled, adding that “Wal-Mart’s conduct was so inconsistent with an intent to enforce its rights to obtain sealed records under the Rules of Court as to induce a reasonable belief that it had relinquished such right … Wal-Mart could not reasonably think that the trial court had sealed the documents submitted with the writ petitions, because Wal-Mart had not moved for an order sealing the record; had not submitted points and authorities and a declaration justifying sealing; and there was no court order granting the nonexistent motion … Nor could Wal-Mart reasonably think that it could operate under a parallel legal universe, outside [the] rules.”
The Appeals Court continued that the California Constitution requires the courts “to broadly construe a statute or court rule ‘if it furthers the people’s right of access’ and to narrowly construe the same ‘if it limits the right of access’… The rules for sealing records are mandatory, furthering the presumption and constitutional interest in open records.”
The Appeals Court denied the Daily Planet’s request for attorneys’ fees for bringing the motion in court on narrow procedural grounds, saying that no attorneys’ fees were due because the newspaper did not file a separate lawsuit to have the documents released, but only filed a motion within the original employees’ lawsuit.
Rosenfeld said that the Daily Planet “could have intervened as a party to the original lawsuit, but that wouldn’t have made sense.”
Rosenfeld said he is currently discussing the feasibility of an appeal of the attorneys’ fees ruling with the Daily Planet’s owners. He said while he has no direct knowledge of whether or not Wal-Mart will appeal the document production ruling, “being Wal-Mart, it wouldn’t surprise me if they did.”
But for the moment, Rosenfeld called it “a fantastic victory, overall. I can’t complain.”