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Laura GUARDINO, individually and the as Personal Representative of the Estate of “RK,” “W.K., JR.,” * Individually, Plaintiff(s), v. GRACO CHILDREN'S PRODUCTS INC., a Subsidiary of Newwll Rubbermaid Inc., Delaware Corporationtransacting business in New York State, Babies “R” Us, Inc., a subsidiary of Toys R Us, Inc., A Delaware corporation transacting business in New York State, Defendant(s).

No. 42325/2010.

Decided: November 24, 2015

Davis, Saperstein & Salomon, Schiff Hardin & Waite, Esqs., New York.

Upon the following papers numbered 1 to 2 read on this Motion/Order to Show Cause for a Sealing Order; Notice of Motion/Order to Show Cause and supporting papers 1–2; Notice of Cross Motion and supporting papers 0; Answering Affidavits and supporting papers 0; Replying Affidavits and supporting papers 0; Other 0; (and after hearing counsel in support and opposed to the motion), it is

ORDERED that Plaintiffs' motion to seal the proposed settlement of this case is denied (22 NYCRR § 216.1[a] ).

The matter at hand is a wrongful death action for product liability sounding essentially in strict liability, negligence and breach of warranty. Specifically, it is alleged that Defendant Graco designed and manufactured (and Defendant Babies “R” Us, Inc. distributed) an unreasonably dangerous baby stroller which caused the strangulation death of the Plaintiffs' child. In an effort to spare their respective clients the expense, time and distress of litigation, Plaintiffs and defense counsel negotiated a settlement of the claims. “This settlement agreement contains a material provision that requires the parties to keep the terms of the settlement confidential, with only limited exceptions” (Affirmation of David Drescher Esq., dated September 25, 2015, p. 4 para. 6). In furtherance of this understanding, Plaintiffs have made an unopposed motion to seal the Order for Death Compromise that is to be filed with the Court. Plaintiffs' counsel argues that “The Court should grant Plaintiffs' petition because not doing so would run counter to the well-recognized, strong public policy interests in allowing litigants to reach confidential settlements” (Affirmation of David Drescher Esq., dated September 25, 2015, p. 4 para. 7).

In support of their application, Plaintiffs cite to the holdings in Crain Commc'ns, Inc. v. Hughes, 135 A.D.2d 351, 521 N.Y.S.2d 244 [1st Dept.1987] aff'd, 74 N.Y.2d 626 [1989]; Matter of Estate of R.R., 153 Misc.2d 747, 582 N.Y.S.2d 644 [Surr. Ct., Rensselear Co.1992] and Matter of E. 51st St. Crane Collapse Litig., 31 Misc.3d 406, 920 N.Y.S.2d 584 (Sup.Ct. N.Y. Co.2011). The applicability of these cases shall be discussed ad seriatim.

Initially, the Court must note that contrary to Plaintiffs' counsel's eloquent declaration that public policy favors confidential settlements, there is actually a well settled body of law that holds the public interest is better served by promoting open access to the Court, its proceedings and records (Mosallem v. Berenson, 76 AD3d 345, 905 N.Y.S.2d 575 [1st Dept.2010]; citing Mancheski v. Gabelli Group Capital Partners, 39 AD3d 499, 835 N.Y.S.2d 595 [2007]; Gryphon Dom. VI, LLC v. APP Intl. Fin. Co., B.V., 28 AD3d 322, 814 N.Y.S.2d 110 [2006]; Danco Labs. v. Chemical Works of Gedeon Richter, 274 A.D.2d 1, 711 N.Y.S.2d 419 [2000] ).

This embrace of “open Courts” is born of America's historical antipathy to any judicial proceeding that brings remembrance of that opprobrious body from the past, repudiated by revolutions and constitutions, of whom the mere mention of its name fills the Court with dreadthe secret tribunal that consigned its victims to grim fates without the pretense of legal protection, the feared and hated Star Chamber (Gannett Co. v. De Pasquale, 43 N.Y.2d 370, 376, 372 N.E.2d 544, 547 (1977) aff'd sub nom. Gannett Co. v. DePasquale, 443 U.S. 368, 99 S.Ct. 2898, 61 L.Ed.2d 608 (1979). Its existence will always be a stain on the annals of a justice system, that, for the most part, has been the light of the World.

There is an acknowledged right of privacy found in the arena of commerce. It properly cloaks the negotiation of disputes and ultimate agreements. When issues and parties are haled into Court for the purpose obtaining the nihil obstat of the judicial forum, however, privacy often yields to public scrutiny. This rule, however, is not absolute and the cases cited by Plaintiffs' counsel provide certain exceptions.

Crain Commc'ns, Inc. v. Hughes, supra, held that public access to Court records could be curtailed in matters involving “a source of business information which might harm a litigant's competitive standing” (Id. At 352). The Court would also act to protect “․ confidential trade information” (Id. At 352).

Matter of Estate of R.R. Jr., 153 Misc.2d 747, 582 N.Y.S.2d 644(Sur.1992) granted an application to seal medical records that “․ contain anecdotal items which have not been established as fact and which are potentially embarrassing to the memory of the decedent and his family” (Id. at 748). In addition to the sealing having the function of protecting the “․ Plaintiffs from becoming targets of unwanted solicitations and swindles,” the Court found that “Disclosure of the items would serve no useful public purpose” (Id. at 748).

Matter of E. 51st St. Crane Collapse Litig, supra, recognized that in a complex consolidated litigation involving “nearly 20 parties” disclosure of the details of a settlement between Plaintiffs and one of the Defendants “․ would certainly have a chilling effect on the willingness of Defendants to participate in settlement negotiations in the remaining consolidated actions” (Id. at 415).

The forgoing exceptions to the general rule promoting open Courts and open records have a common thread. They are narrowly written and must be narrowly construed.

The legislature has also provided exceptions (e.g., FCA § 166; DRL §§ 114, 235; CPL § 160.50; PHL § 2785[3] ). A perusal of the claims in this matter demonstrate that the aforementioned statutes are inapplicable. Aside from case law, the sole authority to guide the Court is found in 22 NYCRR § 216.1[a] which states:

“Except where otherwise provided by statute or rule, a court shall not enter an order in any action or proceeding sealing the court records, whether in whole or in part, except upon a written finding of good cause, which shall specify the grounds thereof. In determining whether good cause has been shown, the court shall consider the interests of the public as well as of the parties.”

This regulation merely codifies the previously discussed case law favoring disclosure (see also In re Petrowski, 20 Misc.3d 860, 862 N.Y.S.2d 901 [Sur.Ct Kings Co.2008] citing Mancheski v. Gabelli Group Capital Partners, 835 N.Y.S.2d 595, 597, 39 AD3d 499, 501 (2d Dep't 2007), citing Republic of Philippines v. Westinghouse Elec. Corp., 949 F.2d 653, 660 (3d Cir.1991). 22 NYCRR § 216.1[a] recognizes that the Court possesses the discretion to “balance the competing interests of the parties, the public, and the justice systems. When the balance favors confidentiality, confidentiality should be provided” (Matter of Twentieth Century Fox Film Corp., 190 A.D.2d 483, 486, 601 N.Y.S.2d 267, 269 (1st Dept .1993) quoting Miller, The Private Costs of Public Justice, 63 N.Y. St BJ 12, 13 [July/Aug.1991] ).

The term “public interest” is not monolithic and must be parsed by the Court in deciding the propriety of the sealing application. For instance, satisfying the public's curiosity is insufficient to overcome a valid articulated reason to seal the Court's records (Matter of Estate of R.R. Jr., supra at 749).

In the matter sub judice, the answer to this question is found in the nature of the case itself, namely product liability. It is beyond cavil that “․ it is to the public interest to discourage the marketing of products having defects that are a menace to the public” (Escola v. Coca Cola Bottling Co. of Fresno, 24 Cal.2d 453, 462, 150 P.2d 436, 441 (1944), Traynor J. concurring). Cases involving product liability are viewed in an entirely different lense than instances involving other controversies. The Court in Matter of Estate of R.R. Jr., supra, cited by the movant, justified its sealing order with the comment “This is not a case concerning a defective product ․ that would involve matters of health or safety” (Id. at 749). The remaining authority cited by Plaintiffs are similarly distinguishable.

Indeed, the promulgation of Rule § 216.1[a] was in response to concerns that “․ had been widely expressed about the practice of sealing records of settlements in product liability and other tort actions where the information might alert other consumers to potential defects” (Matter of Twentieth Century Fox Film Corp., supra at 486 citing M. Hoenig, Products Liability, New York's Rule on Sealing of Court Records, NYLJ, March 1, 1991, at 3, col. 1; Carpinello, Public Access to Court Records in Civil Proceedings: The New York Approach, 54 Albany L.Rev. 93, 98–100; Herman, No more Dirty Little Secrets in the Courts, Wash. Post, Sept. 15, 1989, at A31, col. 6).

Applying the forgoing principles to the instant case the Court finds that there is a strong public interest in a lawsuit involving the death of a child allegedly caused by a defective baby stroller. The parties interest in keeping the details of their settlement confidential do not constitute good cause to the extent that it outweighs this public interest. Therefore, under the circumstances presented, the motion must be denied.

The foregoing constitutes the decision and Order of the Court.


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