Appendix — Liggett Group, Inc. v. Public Citizen

[Mi Neinne

Supreme Court, U.S.

: y FILED

QQ eo 90eF

GOS ey”) | NOV 16 1988

No. 88- :

. SPANIOL, JR,

3 CLERK

IN THE

Supreme Court of the United States

OctTosBer TERM, 1988

ccartaiieematiniie tensa

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO.., INC..

Petitioners.

Sal ak

PUBLIC CITIZEN,

THE AMERICAN CANCER SOCIETY,

THE AMERICAN HEART ASSOCIATION.

THE AMERICAN LUNG ASSOCIATION and

THE AMERICAN PUBLIC HEALTH ASSOCIATION.

Respondents.

APPENDIX TO THE PETITION

FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT

DoNnaALD J. COHN

(Counsel of Record)

WEBSTER & SHEFFIELD

237 Park Avenue

Of Counsel: New York, New York 10017

LAWRENCE D. Gerzoc (212) 808-6000

JostaH S. Murray, III

Liccett Group INc.

300 North Duke Street

Durham, North Carolina 27702

(919) 683-9000

(Additional Counsel Listed on Inside Cover)

Of Counsel:

JosEPH J. LEGHORN

SAMUEL ADAMS

WARNER & STACKPOLE

75 State Street

Boston. Massachusetts 02109

(617) 951-9000

Attorneys for Petitioners

TABLE OF CONTENTS

Opinions Page

Opinion of the Court of Appeals, dated

September 28, 1988 (858 F.2d 775)........... A-]

Opinion of the Court of Appeals, dated August

25, 1987 (825 F.2d 620)..................... B-]

Judgments

Judgment of the District Court, dated October 7,

WE ee holier a as ae en LCT ee eee. C-]

Orders

Order of the Court of Appeals, dated April 11,

SIE rare ae apn Bea sg asd fe a ae D-1

Handwritten Order of the District Court

accompanying Motion of Public Citizen et al.

to Order Filing and to Modify Protective

Order, dated January 28, 1988............... E-]

Handwritten Order of the District Court

accompanying Motion of Public Citizen et al.

to Order Parties to Maintain Discovery

Materials, dated December 28, 1987.......... F-]

Handwritten Order of the District Court

accompanying Defendants’ Motion for Entry of

Judgment, dated October 6, 1987 ............ G-]

Handwritten Order of the District Court

accompanying Plaintiffs’ Motion for

Reconsideration, dated August 12, 1985....... H-1

Handwritten Order of the District Court

accompanying Proposed Intervenor’s Motion for

Reconsideration, dated August 12, 1985....... I-]

Page

Handwritten Order of the District Court

accompanying The Wall Street Journal's

Motion for Leave to Intervene, dated July 19,

i Oe J-l

Handwritten Order of the District Court

accompanying Plaintiffs’ Motion for

Clarification or Modification, dated July 16,

|| |, PP K-]

Handwritten Order of the District Court

accompanying Defendants’ Motion to Require

Compliance with Protective Order, dated July

IG, 1965... 22.44.55 mere errs L-]

Order of the District Court, dated February 25,

i: PS M-1

Handwritten Order of the District Court

accompanying Defendants’ Request for a

Protective Order, dated February 25, 1985 .... N-1

Other Materials

Transcript of Hearing before the District Court.

January 2%, 1068.......1..... ee O-]

A-1]

Opinion of the Court of Appeals,

dated September 28, 1988

PUBLIC CITIZEN, AMERICAN CANCER SOCIETY.

AMERICAN HEART ASSOCIATION,

AMERICAN LUNG ASSOCIATION and

AMERICAN PUBLIC HEALTH ASSOCIATION,

Plaintiffs-Appellees,

— V. —

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.

Defendants-Appellants.

No. 88-1195

United States Court of Appeals,

First Circuit

Decided September 28, 1988

Before: BOWNES and BREYER, Circuit Judges,

and CAFFREY,* Senior District Judge

BOWNES, Circuit Judge:

Liggett Group, Inc., and Liggett & Myers Tobacco Co. (collect-

ively “Liggett”) appeal an order of the district court modifying an

earlier protective order covering discovery materials produced by

Of the District of Massachusetts, sitting by designation.

A-2

Liggett. Request for the modification came from a group of

public health organizations represented by Public Citizen

Litigation Group (“Public Citizen”)! Liggett contends that Public

Citizen lacked standing to request modification, both because

it failed to obtain status as an intervening party under Rule 24

of the Federal Rules of Civil Procedure and because it had no

substantive right of access to the materials in question, and that

it failed to establish adequate circumstances justifying the

modification. We affirm in part but modify the district court's

order.

I. BACKGROUND

A. Initial Proceedings

On August 26, 1980, Joseph C. Palmer died of lung cancer

after having smoked cigarettes made by Liggett for a number

of years. Three years later, Palmer’s wife and mother filed a

diversity action against Liggett in United States District Court

for the District of Massachusetts. The Palmers asserted various

state law claims against Liggett based on Liggett’s allegedly in-

adequate warnings about the health risks of smoking.

Discovery began in 1984 and, during the course of discovery,

three protective orders were entered by the district court. The

first two orders, dated January 17, 1984, and January 25, 1985,

pertained to the confidentiality of the plaintiffs’ medical records.

They are not at issue here. It is the third protective order, pro-

viding broad protection for documents produced by Liggett,

which is the center of the current controversy.

This protective order grew out of plaintiffs’ January 22, 1985

deposition subpoena directed to the custodian of documents at

Arthur D. Little, Inc. (“Little”). Little is a private consulting

firm that performed research work for Liggett in the early 1950's.

' The organizations are American Cancer Society, American Heart Associa-

tion. American Lung Association and American Public Health Association.

A-3

Pursuant to the subpoena and by agreement of the parties, plain-

tiffs’ counsel were permitted to inspect eighteen boxes of

documents at Little's offices on January 30-31, 1985. Counsel

began copying documents on February 1, 1985. On February

5, Liggett moved for a protective order under Rule 26(c) bar-

ring any nonlitigatory use of the Little documents and of all

future discovery in the action. In support of its request, Liggett

asserted that plaintiffs’ discovery requests encompassed massive

numbers of documents and that it would be “physically impossi-

ble for [Liggett] to designate individually each document con-

taining confidentia! or secret information.”

The plaintiffs opposed the protective order on the ground,

among others, that Liggett had waived its claims to confiden-

tiality by previously allowing counsel to review and copy the

Little documents. The district court granted Liggett’s motion

and signed the protective order on February 25, 1985.

The order as approved had two components. The first is a

blanket provision mandating that “[a]ll information produced.

or exchanged in the course of this civil action or any appeal aris-

ing therefrom . . . shall be used solely for purposes of this case.”

The second provides heightened protection for any materials

explicitly designated by a party as “confidential.” With regard

to both categories of materials, the protective order provides

that “[w]ithin forty-five days after the final adjudication or set-

tlement of all claims in this case, counsel for the parties either

shall return all documents produced, if so requested by the pro-

ducing party, or shall destroy all such documents. All copies of

all documents, and all information and notes derived from them.

also shall be destroyed.”

Subject to the restrictions of the protective order, plaintiffs’

counsel copied approximately 1200 documents (one box full)

from the eighteen boxes of Little documents to which the plain-

tiffs had access. None of these documents were ever designated

by Liggett as confidential. The documents have remained in the

possession of plaintiffs’ counsel since that time.

On June 7, 1985, the Wall Street Journal wrote a letter to the

district court expressing interest in seeing the Little

A-4

documents and seeking advice on how best to proceed in ob-

taining a modification of the protective order. One week later,

plaintiffs’ counsel filed a “Notice of Intent to Disseminate [the

Little] Documents” to the Wall Street Journal. In support of their

proposed action, plaintiffs cited Liggett’s failure to designate

any documents as confidential and to articulate any reason why

release of the documents would harm Liggett. Plaintiffs also

pointed out that many of the documents had been marked as

exhibits for trial and thus would be made public eventually

anyway. Liggett opposed the plaintiffs’ proposed action, argu-

ing that the protective order was still in full force, and, on June

28, 1985, filed its own “Motion to Require Compliance With

Protective Order.”

In response, plaintiffs filed a motion for clarification or

modification of the February 25 protective order. Plaintiffs

argued that the order should be read as applying only to

documents designated as confidential, because otherwise it

would extend protection to information whether or not it

qualified as confidential under the federal rules. At this point,

the Wall Street Journal also sought leave to intervene in the ac-

tion and filed its own request for clarification or modification.

On July 16, 1985, the district court refused to modify the pro-

tective order and allowed Liggett’s motion to compel com-

pliance. It noted: “The dissemination of this material will not

aid in the fair trial of this case. The trial is public and the Wall

Street Journal is, of course, able to attend the trial.” Plaintiffs’

and the Wall Street Journal’s motions were denied.

One week later, the Wall Street Journal moved for reconsidera-

tion of the district court order. The Journal’s motion was based

primarily on the decision in Cipollone v. Liggett Group, Inc.,

106 F.R.D. 573 (D.N.J. 1985), handed down the day after the

order to compel compliance was issued in this case. Like the

Palmers’ case, Cipollone involved state law claims that inade-

quate warnings by Liggett had caused the death of a Liggett

cigarette smoker. In the cited decision in Cipollone, Judge

Sarokin had substantially modified a protective order, previously

approved by a magistrate, which was “identical” to the February

25, 1985 protective order in this case. Id. at 579. Judge Sarokin

A-5

found that the provision extending blanket protection to

documents not designated as confidential “overstep| ped] the

bounds permitted by Rule 26(c)” and he accordingly modified

the order to extend only to confidential information. Id. at 584.

Although acknowledging that its analysis diverged from Judge

Sarokin’s, the district court in this case denied the motion to

reconsider. It noted: “Motion denied, without prejudice to

renew. The Sarokin opinion is now under appeal. This motion

should be renewed following a ruling by the Third Circuit Court

of Appeals.”

In April of 1986, Liggett moved to dismiss certain of plain-

tiffs’ claims on the ground that they were preempted under the

Federal Cigarette Labeling and Advertising Act, 15 U.S.C. § 1331

et seq. The district court denied the motion but certified the

question pursuant to 28 U.S.C. § 1292(b), to this court, which

reversed. Palmer v. Liggett Group, Inc., 825 F.2d 620 (Ast Cir.

1987). We held that in passing the Act, Congress had struck a

“carefully drawn balance between the purposes of warning the

public of the hazards of cigarette smoking and protecting the

interests of the national economy” and that permitting the in-

terposition of state actions into the area would excessively disrupt

the congressional scheme. Id. at 626 (quoting Cipollone v. Lig-

gett Group, Inc., 789 F.2d 181, 187 (3d Cir. 1986), cert. denied,

107 S. Ct. 907 (1987)). The Palmers’ state law claims were thus

preempted.

In light of our opinion, Liggett moved in the district court

to have the Palmers’ complaint dismissed and judgment entered

* The Third Circuit eventually issued a writ of mandamus, noting errors in

Judge Sarokin’s analysis, and remanded for reconsideration. Cipollone v. Lig-

gett Group, Inc., 785 F.2d 1108 (3d Cir. 1986). On remand, Judge Sarokin

modified his analysis with respect to documents designated as confidential,

but nonetheless found that Liggett had failed to establish good cause for pro-

tection under Rule 26(c). Judge Sarokin also stuck by his original order strik-

ing down the blanket protection for undesignated documents. Cipollone \

Liggett Group, Inc., 113 F.R.D. 86 (D.N.J. 1986). The Third Circuit subse-

quently denied Liggett’s petition for mandamus concerning that decision, and

the Supreme Court denied a Liggett petition for certiorari on December 7.

1987. Cipollone v. Liggett Group, Inc., 822 F.2d 335 (3d Cir.), cert. denied.

108 S. Ct. 487 (1987).

A-6

for Liggett. Over the plaintiffs’ objections, the district court

granted the motion and entered judgment for Liggett on Oc-

tober 6, 1987. No appeal was taken.

B. Public Citizen’s Motion for Access to Discovery Materials

On December 28, 1987, Public Citizen filed two motions in

district court. In its first motion, Public Citizen sought in-

terlocutory relief: an order mandating that the parties main-

tain and not destroy or return discovery materials in the Palmer

case pending resolution of its second motion. This first motion

was allowed by the district court the same day. The second mo-

tion sought a modification of the February 25, 1985 protective

order such that all discovery materials could be freely

disseminated, except for those documents in which Liggett had

“good cause” for continued confidentiality. It also requested that

the district court order the parties to file all discovery materials

in court. The broad relief requested by Public Citizen seemingly

applied to materials produced both by Liggett and the plain-

tiffs, but, in argument, Public Citizen made clear that it sought

access only to the Little documents produced by Liggett.

Public Citizen based its access claim on Rules 5(d) and 26(c)

of the Federal Rules of Civil Procedure. Rule 5(d) provides:

All papers after the complaint required to be served

upon a party shall be filed with the court either before

service or within a reasonable time thereafter, but the

court may on motion of a party or on its own initiative

order that depositions upon oral examination and in-

terrogatories, requests for documents, requests for ad-

mission, and answers and responses thereto not be filed

unless on order of the court or for use in the

proceeding.

Rule 26(c) provides in pertinent part:

Upon motion by a party or by the person from whom

discovery is sought, and for good cause shown, the

court . . . may make any order which justice requires

to protect a party or person from annoyance, embar-

rassment, oppression, or undue burden or expense, in-

cluding one or more of the following: (1) that the

A-7

discovery not be had; (2) that the discovery may be

had only on specified terms and conditions, including

a designation of the time or place; (3) that the

discovery may be had only by a method of discovery

other than that selected by the party seeking discovery;

(4) that certain matters not be inquired into or that

the scope of discovery be limited to certain matters;

(5) that discovery be conducted with no one present

except persons designated by the court: (6) that a

desposition after being sealed be opened only by order

of the court; (7) that a trade secret or other confiden-

tial research, development, or commercial informa-

tion not be disclosed or be disclosed only in a

designated way; (8) that the parties simultaneously

file specified documents or information enclosed in

sealed envelopes to be opened as directed by the court.

Rule 5(d), Public Citizen argued, creates a presumption that

all discovery materials will be available to the public because

they will be filed in court. Moreover, under Rule 26(c), public

access can be cut off through a protective order only upon the

showing of “good cause.” Especially in light of the district court’s

dismissal of the Palmers’ claims in this case, Public Citizen

asserted that good cause for the February 25, 1985 protective

order no longer existed. Thus, it said. the order should be

modified and Rule 5(d) filing of discovery materials ordered.

Public Citizen did not make a formal motion to intervene in

the case pursuant to Rule 24. Rather, it sought to proceed in-

formally under Rule 16(g) of the Local Rules of the United States

District Court for the District of Massachusetts. Local Rule 16(g)

is based on Rule 5(d) of the Federal Rules, but it actually reverses

in part the filing presumption of Rule 5(d), by providing that

discovery materials ordinarily are not to be filed in court “unless

so ordered by the court or for use in the proceeding.” Essential-

ly, Rule 16(g) codifies the local practice of district courts always

ordering — as Rule 5(d) permits — that discovery materials other-

wise subject to the Rule 5(d) filing requirement not be filed pur-

suant to Rule 5(d) unless the court asks that they be filed. To

A-8

facilitate this scheme, Rule 16)g) provides that parties and non-

parties may request that filing be ordered:

If for any reason a party or concerned citizen believes

that any [discovery documents subject to the Rule 5(d)

filing requirement] should be filed, an ex parte request

may be made that such document be filed, stating the

reasons therefor. The court may also order filing sua

sponte.

Believing that Rule 16(g) thus obviated the need for obtaining

formal intervenor status in order to request filing, Public Citizen

sought relief as a nonparty. In the event the district court thought

intervention necessary, however, Public Citizen did ask to be

granted intervenor status and argued that intervention had been

routinely granted in the past when nonparties sought access to

judicial records.

Liggett opposed the motion on a number of grounds. It

claimed first that Public Citizen could participate only as a Rule

24 intervenor and that the time for requesting intervention had

passed. For this reason, Liggett said, Public Citizen lacked stand-

ing. Liggett also disputed Public Citizen's interpretation of Rule

5(d), maintaining that it created no general right of public ac-

cess to discovery materials. Finally, Liggett argued that even

if Public Citizen had standing to seek public access, there had

been no showing of compelling need for a modification.

The district court held a hearing on January 28, 1988, with

counsel for Liggett, Public Citizen and the plaintiffs present.’

The court began by considering whether it still had jurisdic-

tion over the matter, in light of its previous order of dismissal

and judgment for Liggett on the merits. It found that jurisdic-

tion did exist, because the outstanding protective order presented

a live controversy extending past the dismissal of the underlying

* Although the plaintiffs had not filed a formal response to Public Citizen’s

request, the plaintiffs vigorously supported Public Citizen’s efforts at the hear-

ing. As they had previously, plaintiffs said that they were interested in

disseminating to the public the Little documents in their possession,

A-9

claims. The court also agreed with Public Citizen that there is

a right of public access to discovery materials under the federal

rules, a right that was especially strong in this case because of

the important public health concerns surrounding the documents

in question. Moreover, the court said, Liggett had failed to

establish any compelling need for continuing the protective

order. The court accordingly ordered that the eighteen boxes

of Little documents to which the plaintiffs had access, along

with the documents already in the plaintiffs’ possession, be filed

in court and made available to the public.‘

The district court issued a stay pending appeal and this appeal

followed.

Il. THE DISTRICT COURT’S POWER

We begin our analysis, as did the district court, by examin-

ing the court’s jurisdiction, or power, to issue discovery-related

orders after the court dismissed the underlying claims and

entered a judgment on the merits. In so doing, we think it is

important to distinguish between two separate and distinct

aspects of the district court’s January 28, 1988 order which is

under review: the modification of the protective order and the

order that the parties file the discovery materials in court.

Under Local Rule 16(g), the parties to this case were, as par-

ties to cases in the District of Massachusetts generally are, ex-

cused from filing discovery materials in court. The effect of this

nonfiling was to deny the public the right it would otherwise

have had to inspect freely the discovery materials in this case,

* Unsure whether Liggett actually had designated any discovery materials as

confidential under the February 25, 1985 protective order, Public Citizen had,

in its motion for modification, suggested that documents which Liggett main-

tained were confidential might be exempted from filing, subject to in camera

review by the district court to insure that they were indeed confidential. At

the hearing, however, it was brought out by plaintiffs that no designations

had been made, and Public Citizen apparently abandoned its suggestion for

document-by-document review of the materials. In any event, the district court

ruled that Liggett’s time for designating documents as confidential had passed

and that only documents containing trade secrets would be exempt from the

court’s filing order.

A-10

because the materials were not kept in any publicly accessible

location. Certainly the public has no right to demand access

to discovery materials which are solely in the hands of private

party litigants. Rule 16(g) does not in any way limit the use or

dissemination of discovery materials by parties. Indeed, the

Supreme Court has noted that parties have general first amend-

ment freedoms with regard to information gained through

discovery and that, absent a valid court order to the contrary,

they are entitled to disseminate the information as they see fit.

See Seattle Times Co. v. Rhinehart, 467 U.S. 20, 31-36 (1984);

see also Okhahoma Hospital Ass’n v. Okhlahoma Publishing Co.,

748 F.2d 1421, 1424 (10th Cir. 1984), cert. denied, 473 U.S. 905

(1985). In this case, the only thing limiting the parties’ rights

to disseminate discovery materials was the protective order of

February 25, 1985, which barred nonlitigatory use of the Little

documents.

Prior to the entry of that order the situation was this: the par-

ties were not required to release publicly the discovery materials

by filing them, but they were free to disseminate them if they

chose to do so. Cf. Oklahoma Hospital Ass’n, 748 F.2d at 1424

(“While it may be conceded that parties to litigation have a con-

stitutionally protected right to disseminate information gained

by them through the discovery process absent a valid protec-

tive order, it does not follow that they can be compelled to

disseminate such information”) (citing Seattle Times, 467 US.

20). The same situation would have again existed on January

28, 1988, if the district court had modified or vacated the pro-

tective order, but not ordered filing under Rule 5(d). Instead,

however, in response to Public Citizen’s request, the district court

both modified the protective order by virtually eliminating it,

see note 4 supra, and ordered filing, without much distinguishing

between these two aspects of its order. Because we believe that

the two aspects raise separate legal issues and concerns, we con-

sider them individually.

With respect to the filing aspect of the court’s order, we believe

that by the time the district court acted on January 28, 1988,

it lacked the power to impose such new requirements on the

A-11

parties. Accordingly, we vacate that part of the district court’s

order.

Our reasoning is simple. The district court’s judgment of Oc-

tober 6, 1987, was a final dismissal on the merits, concluding

the litigation between the Palmers and Liggett. It left no substan-

tive issue unresolved and it contained no provisions for equitable

relief that would have required ongoing supervision by the

district court. Under these circumstances, we think that the court

simply lacked power to impose any new, affirmative re-

quirements on the parties relating to discovery. See Cooper v.

R.J. Reynolds Tobacco Co., 256 F.2d 464, 466-67 (1st Cir.) (once

a district court dismisses a complaint and enters judgment, it

lacks the power to grant a motion to amend the complaint), cert.

denied, 358 U.S. 875 (1958); Bailey v. Proctor, 166 F.2d 392, 395

(1st Cir. 1948) (a district court’s jurisdiction to modify its own

order exists “as long as no final order has been issued”); see also

Littlejohn v. BIC Corp., 851 F.2d 673, __ (3d Cir. 1988)

(“[A]bsent allegations of fraud or other extraordinary cir-

cumstances, trial exhibits that were restored to their owner after

a case has been completely terminated and which were properly

subject to destruction by the clerk of court are no longer judicial

records within the ‘supervisory power’ of the district court”).

To be sure, a district court has limited power to undo or alter

a judgment after the judgment has been entered. Within strict

time constraints, a court may amend a judgment under Rule

59. Courts may also correct clerical mistakes, Fed. R. Civ. P.

60(a), and even, for good reason, grant a party relief from judg-

ment. Fed. R. Civ. P. 60(b). But no such relief was requested

or granted here. The district court assumed, as did the parties,

that the October 6, 1987 judgment was valid and final.

It is important to note that the purpose of discovery is to

enable parties to an action to obtain material “which is rele-

vant to the subject matter in the pending action,” a purpose that

obviously can no longer be served once a case has been dismissed.

Indeed, once a case has been dismissed and rights to appeal have

lapsed, parties are under no obligation, legal or practical, even

to preserve discovery materials they have obtained. In this

A-12

case, for instance, both the plaintiffs and Liggett were free to

destroy all the Little documents in their possession long before

Public Citizen filed its motion, rendering any Rule 5(d) filing

order meaningless.* Thus, although the district court had the

power under Rule 5(d) to order filing of discovery materials dur-

ing the pendency of the action, we hold that the court’s power

did not extend to postjudgment action.

Turning next to the district court’s modification of the pro-

tective order, we think that an entirely different analysis ap-

plies. Unlike the filing order of January 28, 1988, the protec-

tive order was entered on February 25, 1985, long before the

dismissal and judgment and at a time when the court clearly

had the power to supervise and issue orders concerning

discovery.® Moreover, the protective order, by its own terms, ex-

tended until forty-five days after the “final adjudication or set-

tlement” of the Palmers’ claims.’ During the pendency of the

protective order, including times after judgment, the order acted

as an injunction, setting forth strict limitations on the parties’

use of discovery materials.

In support of this “injunction,” the district court necessarily

had the power to enforce the order, at any point while the order

was in effect, including periods after judgment. As was

demonstrated by the court’s order to compel compliance in the

face of plaintiffs’ expressed intention to provide the Little

documents to the Wall Street Journal, violation of the protec-

tive order during its lifetime would have exposed the parties to

* Counsel for Public Citizen conceded at oral argument that the parties could

have destroyed the discovery materials prior to Public Citizen’s motion without

violating the protective order or any other legal requirement and that, in that

case, Public Citizen would have been out of luck in seeking access.

* On this appeal, no one has contended that the February 25, 1985 protective

order was not a valid protective order at the time it was entered. We have

assumed, without deciding, that it was indeed valid.

’ The Palmers’ claims were not “finally adjudicated” until] November 23, 1987,

when the period for petitioning for certiorari review of this court’s preemp-

tion decision expired. See discussion infra at 26. Public Citizen’s motion of

December 28, 1987, was thus made during the allotted forty-five day period,

while the protective order was stil] in effect.

A-13

contempt liability. Correlative with this power to enforce, the

district court necessarily also retained power to modify the pro-

tective order in light of changed circumstances. The Supreme

Court established long ago that even an injunction entered by

consent of the parties— and this protective order was entered

over the objections of the plaintiffs—is always modifiable.

Power to modify the decree was reserved by its very

terms, and so from the beginning went hand in hand

with its restraints. If the reservation had been omit-

ted, power there still would be by force of principles

inherent in the jurisdiction of chancery. A continu-

ing decree of injunction directed to events to come is

subject always to adaptation as events may shape the

need. . . . [A] court does not abdicate its power to

revoke or modify its mandate if satisfied that what

it has been doing has been turned through changed

circumstances into an instrument of wrong.

United States v. Swift & Co., 286 U.S. 106, 114-15 (1932); see

also Coalition of Black Leadership v. Cianci, 570 F.2d 12, 14

(Ist Cir. 1978) (“There is little dispute that a sufficient change

in circumstances is a meritorious reason for a court to modify

an injunction or consent decree.”); Theriault v. Smith, 519 F.2d

809, 810 (1st Cir. 1975); Food Fair Stores, Inc. v. Food Fair, Inc..

177 F.2d 177, 186 (Ist Cir. 1949). “When dealing with its

equitable powers, a court possesses the intrinsic power to adapt

the injunction to meet the needs of a ‘new day.” Transgo, Inc.

v. Ajac Transmission Parts Corp., 768 F.2d 1001, 1030 (9th Cir.

1985), cert. denied, 474 U.S. 1059 (1986).

Consistent with this well-established rule, we think that the

district court in this case had the inherent power to modify its

February 25, 1985 protective order for so long as the order was

in effect. We note that the courts and commentators seem

unanimous in finding such an inherent power to modify

discovery-related protective orders, even after judgment, when

circumstances justify. E.g., Ex Parte Uppercu, 239 U.S. 435, 440

(1915); FDIC v. Ernst & Ernst, 677 F.2d 230, 232 (2d Cir. 1982):

Krause v. Rhodes, 671 F.2d 212 (6th Cir.), cert. denied, 459 U.S.

A-14

823 (1982); United States v. GAF Corp., 596 F. 2d 10, 16 (2d

Cir. 1979); American Telephone ¢&> Telegraph Co. v. Grady, 594

F.2d 594, 596-97 (7th Cir. 1978), cert. denied, 440 U.S. 97]

(1979); Olympic Refining Co. v. Carter, 332 F.2d 260, 265-66

(9th Cir.), cert. denied, 379 US. 900 (1964); Marcus, Myth and

Reality in Protective Order Litigation, 69 Cornell L. Rev. 1, 41-53

(1983); Note, Nonparty Access to Discovery Materials in the

Federal Courts, 94 Harv. L. Rey. 1085, 1091-96 (1981).

In sum, although the court lacked power to impose new

discovery-related obligations after dismissing the case on the

merits, we find that, because the protective order was still in

effect, the district court had the power to make postjudgment

modifications to the protective order in light of changed cir-

cumstances. Accordingly, we move on to consider the propriety

of the modification actually ordered.

III. STATUS OF THE NONPARTY MOVANTS

As previously noted, Public Citizen did not secure Rule 24

intervenor status in this case, but rather sought to participate

informally under Local Rule 16(g) as a nonparty movant.* In

the district court, Liggett maintained that intervention was

necessary and now, on appeal, challenges the district court’s

* Local Rule 16(g) is quoted supra at 9-10. Rule 24 provides in relevant part:

(a) Intervention of Right. Upon timely application anyone shall

be permitted to intervene in an action: (1) when a statute of the

United States confers an unconditional right to intervene: or (2)

when the applicant claims an interest relating to the property or

transaction which is the subject of the action and the applicant

is so situated that the disposition of the action may as a practical

matter impair or impede the applicant’s ability to protect that

interest, unless the applicant's interest is adequately represented

by the parties. —

(b) Permissive Intervention. Upon timely application anyone

may be permitted to intervene in an action: (1) when a statute

of the United States confers a conditional right to intervene; or

(2) when an applicant's claim or defense and the main action have

a question of law or factincommon. . . . In exercising its discre-

tion the court shall consider whether the intervention will undu-

ly delay or prejudice the adjudication of the rights of the original

parties.

(footnote continued)

A-15

modification order on the ground that Public Citizen lacked stan-

ding because it was not granted intervenor status. Liggett also

claims that Public Citizen was ineligible for Rule 24 intervention

in any event because its motion was untimely. We find Liggett’s

procedural arguments unavailing.

The question of whether nonparty movants may obtain relief

in a civil case appears to be one of first impression in this court.

Prior third-party challenges to court closures and protective orders

have involved either parties who did obtain formal intervenor

status, Anderson v. Cryovac, Inc., 805 F.2d 1, 3-4 (Ist Cir. 1986);

In re San Juan Star Co., 662 F.2d 108, 112 (lst Cir. 1981), or

criminal cases where intervention is not available. E.g., In re Globe

Newspaper Co., 729 F.2d 47, 50 n.2 (Ist Cir. 1984); see also Press

Enterprise Co. v. Superior Court, 478 U.S. 1 (1986) (third-party

claim of access to criminal proceeding); Globe Newspaper Co.

v. Superior Court, 457 U.S. 596 (1982) (same). We think this fact

is significant in and of itself, for it demonstrates that, where in-

tervention is available (i.e. civil cases), it is an effective mechanism

for third-party claims of access to information generated through

judicial proceedings. Like this case, both Anderson and San Juan

Star involved challenges to protective orders covering discovery

materials and, in each case, Rule 24 provided a workable means

for mounting the challenge. Public Citizen has pointed to no cir-

cumstances in this case which made formal intervention impossi-

ble or impracticable.

Relying on the language of Rule 24, the Fifth Circuit has

previously held that intervention is “the procedurally correct course”

for third-party challenges to protective orders. In re Beef Industry

Antitrust Litigation, 589 F.2d 786, 789 (5th Cir. 1979) (emphasis

added). We agree. Rule 24(c) provides that “[a] person desiring

to intervene shall serve a motion to intervene upon the parties as

provided in Rule 5. The motion shall state the grounds therefor

and shall be accompanied by a pleading setting forth the claim

or defense for which intervention is sought.” Fed. R. Civ. P. 24(c)

(c) Procedure. A person desiring to intervene shall serve a motion

to intervene upon the parties as provided in Rule 5. The motion shall

state the grounds therefor and shall be accompanied by a pleading

setting forth the claim or defense for which intervention is sought.

,

A-16

(emphasis added). The language of the rule is mandatory, not

permissive, and the rule sets forth reasonable procedural re-

quirements to insure that claims for intervention are handled

in an orderly fashion. Especially in view of the failure to show

that compliance with the rule would be unduly onerous or in-

effectual, we are not willing to create a special category of non-

Rule 24 intervention for third parties who wish to challenge pro-

tective orders through informal motion. Public Citizen should

have been granted Rule 24 intervenor status before the district

court acted on its motion for access to the discovery materials.

We do not, however, view this error as fatal to Public Citizen’s

claim. We tind two factors persuasive. First, although Public

Citizen sought to proceed in the first instance without Rule 24

intervention, it did request, in the alternative, that it be granted

intervenor status if the district court thought that intervention

was necessary. Second, the district court did afford relief to

Public Citizen as if it were a proper party to the case, thus im-

plicitly granting it intervenor status. Under similar cir-

cumstances, other federal courts have been quite lenient in per-

mitting participation by parties who failed to comply strictly

with Rule 24. In Beef Industry Antitrust Litigation, 589 F.2d

at 788-89, the Fifth Circuit, while setting down a prospective

Rule 24 intervention requirement, was willing to overlook a

failure to comply with Rule 24 in a discovery access case in light

of “the fact that the district court's acts might be considered

equivalent to authorizing intervention.” The Third and Eighth

Circuits have also overlooked a lack of formal compliance when

the district court afforded relief to a nonparty and thus implicitly

granted it intervenor status. United States v. Criden, 675 F.2d

590, 552 n.2 (3d Cir. 1982); Roach v. Churchman, 457 F 2d 1101,

1104 (8th Cir. 1972): see also Ex Parte Uppercu, 239 U.S. 435,

441 (1915) (a pre-federal rules case) (third-party assertion of right

of access to discovery materials “requires no particular formali-

ty”). We think that a similar approach is appropriate here.

It is clear from the proceedings below that the district court

considered Public Citizen to have a legitimate interest in seeking

A-17

modification of the protective order. We have no doubt that,

had the district court thought Rule 24 intervention necessary,

it would have treated Public Citizen’s motion as a request for

intervention and granted it. That being so, no purpose would

now be served if this court were to dismiss the appeal and send

this case back to the district court for the rote procedural step

of approving intervention. After a substantial delay, the case

would still return to us in a similar posture for resolution of the

substantive issue underlying this dispute. For purposes of this

appeal, then, we will treat Public Citizen as having requested

and been granted status as a Rule 24 intervenor. A caveat is,

however, in order: “[W]e reiterate that a formal motion for in-

tervention should have been filed pursuant to Rule 24(c). Future

litigants should not attempt to use this opinion to circumvent

the clear requirements of the rule.” Beef Industry Antitrust

Litigation, 589 F.2d at 789.

We turn next to Liggett’s contention that, even if Public

Citizen is treated as having requested intervention, its motion

to modify was untimely as a matter of law because it was filed

on December 28, 1987, twelve weeks after the judgment on the

merits in this case and after the time for appeal from that judg-

ment had expired. We begin our analysis with two fundamen-

tal principles. First, although Rule 24 requires that an applica-

tion for intervention be “timely,” the rule itself sets down no

bright line standard for determining what constitutes timeliness.

It has thus been held that “timeliness is to be determined from

all the circumstances.” NAACP v. New York, 413 U.S. 345, 366

(1973); see also Culbreath v. Dukakis, 630 F.2d 15, 20 (1st Cir.

1980). Second, timeliness determinations under Rule 24 are

vested in the sound discretion of the district court. NAACP, 413

U.S. at 366. Here, the court found that Public Citizen’s motion

was timely, and we can overturn that ruling only if an abuse

of discretion is demonstrated. See id.; Garrity v. Gallen, 697

F.2d 452, 455 (Ist Cir. 1983).

It is also important to note that postjudgment intervention

is not altogether rare. Numerous courts have allowed third par-

ties to intervene in cases directly analogous to this one, many

involving delays measured in years rather than weeks. E.g.,

A-18

Wilson v. American Motors Corp., 759 F.2d 1568 (11th Cir. 1985)

(third party permitted to intervene after judicially-approved set-

tlement in order to challenge a seal on court documents); FDIC

v. Ernst & Ernst, 677 F.2d 230 (2d Cir. 1982) (third party per-

mitted to intervene and challenge a stipulated confidentiality

order two years after a judicially-approved settlement); Olym-

pic Refining Co. v. Carter, 332 F.2d 260 (9th Cir.) (third party

permitted to challenge a protective order three years after the

underlying litigation had terminated), cert. denied, 379 U.S.

900 (1964); Mokhiber v. Davis, 537 A.2d 1100, 1104-06 (D.C.

1988) (third party permitted to intervene four years after a

judicially-approved consent decree in order to challenge a pro-

tective order); cf. United Airlines, Inc. v. McDonald, 432 U.S.

385 (1977) (permitting postjudgment intervention for purposes

of appeal).

Adopting the analysis of the Fifth Circuit in Stallworth v.

Monsanto Co., 558 F.2d 257 (5th Cir. 1977), this court in

Culbreath v. Dukakis set down a four-part test for determining

whether a motion to intervene is timely under the totality of

the circumstances.* 630 F.2d at 20-24. Applying the same stan-

dard to this case, we find no abuse of discretion in the district

court’s treatment of Public Citizen’s motion as timely.

The first Culbreath factor to be considered is the length of

time that Public Citizen knew or reasonably should have known

of its interest in this case before it petitioned to intervene. 630

F.2d at 20. Analysis of this factor is somewhat complicated here.

On the one hand, it is clear that Public Citizen knew of the

underlying litigation in this case, and therefore implicitly knew

of the protective order, long before judgment was entered in

the district court. Public Citizen concedes as much and, in fact,

Public Citizen represented the same organizations involved in

this appeal as amici in the earlier appeal to this court on the

* In Culbreath, we upheld the district court’s denial of intervention on

timeliness grounds, but the facts there — attempted intervention on the merits

four years after the litigation began and two months prior to submission of

a consent decree — are far different from those in the present case. We thus

refer to Culbreath not for its holding per se, but for the timeliness test it

established.

A-19

issue of federal preemption. On the other hand, it is now well-

established that it is not the simple fact of knowing that a litiga-

tion exists that triggers the obligation to file a timely applica-

tion for intervention. Rather, the appropriate inquiry is when

the intervenor became aware that its interest in the case would

no longer be adequately protected by the parties. United

Airlines, 432 U.S. at 394; Legal Aid Society v. Dunlop, 618 F.2d

48, 50 (9th Cir. 1980); Stallworth, 558 F.2d at 264. By this stan-

dard, we have no trouble concluding that Public Citizen moved

reasonably promptly.

To begin with, the very same request for modification of the

protective order put forth by Public Citizen after judgment had

been made by plaintiffs and the Wall Street Journal in 1985.

In turning down those requests, the district court cited two fac-

tors: first, that many of the discovery documents in question

presumably would be introduced at trial and made public at

that time; and, second, that the very issue of the propriety of

this protective order was being litigated in the Cipollone case

in the Third Circuit, making it appropriate for the court to wait

until after the Third Circuit litigation was resolved to decide

the protective order issue in this case. Certainly, then, Public

Citizen cannot be said to have been untimely for failing to act

prior to the resolution of the issues underlying the court’s two

concerns.

With respect to the first factor, the possibility of trial could

not be ruled out prior to October 6, 1987, when the district court

dismissed the claims and entered judgment. Moreover, even that

judgment did not finally resolve the matter, for the plaintiffs

had until November 5, 1987, to appeal the judgment, and the

time for plaintiffs to petition for certiorari review of this court’s

preemption decision (upon which the dismissal was based) did

not expire until November 23, 1987. Counting back from the

December 28, 1987 filing date of its motion, Public Citizen’s

delay was, therefore, eight weeks or four weeks depending on

which of these latter dates is used. If we refer to the second factor

cited by the court —the Cipollone litigation — Public Citizen’s

delay is only three weeks, for, as we indicated in note 2 supra,

the protective order aspect of the Cipollone case was not resolved

A-20

until December 7, 1987. In the context of this case, which had

been proceeding for well over four years, we do not think that

this delay, on the order of weeks, was material.

The second Culbreath factor to be considered is the prejudice

to existing parties due to Public Citizen’s delay in intervening.

630 F.2d at 21. This factor encompasses the basic fairness notion

that intervention should not work a “last minute disruption of

painstaking work by the parties and the court.” Id. at 22. For

purposes of this factor, therefore, it is necessary to ask why a

would-be intervenor seeks to participate, for if the desired in-

tervention relates to an ancillary issue and will not disrupt the

resolution of the underlying merits, untimely intervention is

much less likely to prejudice the parties. Here, of course, Public

Citizen’s motion pertains to a particularly discrete and ancillary

issue, as demonstrated by the fact that the merits of the case

have been already concluded and are no longer subject to review.

Because Public Citizen sought to litigate only the issue of the

protective order, and not to reopen the merits, we find that its

delayed intervention caused little prejudice to the existing par-

‘ies in this case.

The analysis of the District of Columbia Court of Appeals

n the recent case of Mokhiber v. Davis, 537 A.2d 1100 (D.C.

1988), is particularly relevant on this point. In Mokhiber, an

nvestigative journalist petitioned to intervene in a civil case in

der to gain access to discovery materials and related court

ilings, which had been placed under a protective order. Judg-

nent in the case had been issued four years previously pursuant

O a stipulation of settlement. Like Public Citizen in this case,

he journalist in Mokhiber sought to modify the protective order

0 facilitate public access. Although the court eventually denied

n substantive grounds the request for modification as to some

f the discovery materials, it rejected the notion that interven-

ion four years after settlement was untimely given the “special

ature of the right” asserted.

[O]}rdinary principles applicable to intervention do

not work well here. The filing of a motion to intervene

is simply recognized as an appropriate means of

A-2]

raising assertions of public rights of access to infor-

mation regarding matters in litigation. “Intervention

of this type may properly be termed de bene esse, to

wit, action that is provisional in nature and for the

limited purpose of permitting the intervenor to file

a motion to be considered separately, requesting that

access to proceedings or other matters be granted.”

Commonwealth v. Fenstermaker, 530 A.2d 414, 416

n.l (Pa. 1987).

[T]o the extent [a right of access] exists, it exists to-

day for the records of cases decided a hundred years

ago as surely as is does for lawsuits now in the early

stages of motions litigation. The fact that a suit has

gone to judgment does not in any sense militate against

the public's right to Prosecute a substantiated right

to see the records of a particular case. Moreover, ac-

cess to court records does not involve relitigation of

the underlying dispute, so the rationale behind requir-

ing extraordinary circumstances for postjudgment in-

tervention does not as a rule apply to access claims.”

[T]he prejudice the parties would suffer from post-

judgment access to court documents should not deter-

mine the timeliness of the intervention-to assert [a]

right of access. Instead. assuming an intervenor does

assert a legitimate, presumptive right to open the court

record of a particular dispute, the potential burden

or inequity to the parties should affect not the right

to intervene but, rather, the court’s evaluation of the

merits of the applicant’s motion to lift the protective

order — that is, the court’s judgment as to whether,

under the circumstances, the balance of equities favor-

ing sealing overrides any presumptive right of access.

_sstesncnsientiisesesesnnnees

It is for precisely this reason that Liggett’s citation to Burney v. City of

awtucket, 728 F.2d 547 (Ist Cir. 1984), is misplaced. In Burney, we set down

hard and fast rule that intervention on the merits “is never timely . . . if

A-22

Id. at 1105-06. We find this analysis compelling and reject the

notion that prejudice to the parties in this action would be

grounds for denying intervention by Public Citizen.

The third and fourth Culbreath factors to be considered are

t. . prejudice that would be suffered by Public Citizen if it were

not allowed to intervene and the existence of extraordinary cir-

cumstances militating for or against intervention. 630 F.2d at

22, 24. Given our treatment of the first two factors, we need

not dwell overlong on these considerations. It is sufficient to note

that Public Citizen has asserted, on behalf of the public, a right

to have the protective order modified such that the discovery

materials may be publicly disseminated, and that, prior to Public

Citizen's action, this interest was not being pursued by any of

the parties to the case” If Public Citizen’s motion is found to

be untimely, future intervention attempts will almost certainly

also be found to be untimely, and the public’s right of access

will go untested. As the district court found, there is a strong

public interest in the documents at issue, which concern an im-

portant public health issue.

Having thus concluded that Public Citizen can be considered

as a proper Rule 24 intervening party, we believe it has stan-

ding to pursue the public access claim here at issue. Courts, in-

cluding this one, routinely have found that third parties have

standing to assert their claim of access to documents in a judicial

proceeding. E.g., In re Alexander Grant & Co. Litigation, 820

F.2d 352, 354 (11th Cir. 1987); Anderson v. Cryovac, Inc., 805

F.2d 1 (1st Cir. 1986); In re Globe Newspaper Co., 729 F.2d 47,

50 n.2 (Ist Cir. 1984); In re San Juan Star Co., 662 F.2d 108 (1st

Cir. 1981); see also cases cited supra at 17, 23”

" Although the plaintiffs did seek permission to disseminate the discovery

materials at an earlier stage of the litigation and continue to support Public

Citizen's claim, they took no steps on their own to have the protective order

modified after judgment.

* We have uncovered only one access case where standing was found lacking,

but that case is clearly distinguishable. Oklahoma Hospital Ass'n v. Oklahoma

Publishing Co., 748 F.2d 1421 (10th Cir. 1984), cert. denied, 473 U.S. 905 (1985),

(footnote continued)

A-23

IV. A RIGHT OF PUBLIC ACCESS TO DISCOVERY?

In assessing the claimed right of access in this case, it is helpful

to begin by noting what is not being claimed. Unlike many prior

litigants in this court and others,” Public Citizen has not claimed

that it has—independent of the federal rules— a general com-

mon law or first amendment right to inspect the discovery

materials. Such a claim has been largely foreclosed by the

Supreme Court’s decision in Seattle Times Co. v. Rhinehart, 467

U.S. 20 (1984), which must serve as the background for any

claimed right of access to discovery materials.

In Seattle Times, members of a religious group sued the Seattle

Times in state court for defamation and invasion of privacy. As

part of its defense of that case, the Seattle Times sought to

discover information regarding membership in and donations

to the religious group during the previous five years. When the

group resisted, the trial court compelled production, but entered

a protective order under the state analog of Federal Rule 26(c)

prohibiting the Seattle Times from disseminating or using the

information in any way except as necessary to prepare and try

its case. The Seattle Times then challenged the protective order

as a prior restraint on speech in violation of the first amendment.

involved a protective order entered by stipulation covering documents solely

in the hands of the parties. The court found that a third party lacked stan-

ding to attack the protective order because, even if the protective order were

modified, the parties in possession of the documents would not, and could

not be compelled to, disseminate the documents to the third party. Id. at

1424-25. Here, however, far from agreeing to the protective order, the plain-

tiffs to this action have opposed the protective order at every stage. Moreover,

the plaintiffs have indicated clearly that they will disseminate the documents

if permitted to do so. Because obtaining a modification of the protective order

will, as a practical matter, guarantee Public Citizen access to documents in

the plaintiffs’ possession, Public Citizen has standing to seek the modification.

See, e.g., In re Alexander Grant & Co. Litigation, 820 F.2d 352, 354-55 (11th

Cir. 1987); Anderson v. Cryovac, Inc., 805 F.2d 1 (Ist Cir. 1986); In re San

Juan Star Co., 662 F.2d 108 (lst Cir. 1981); In re Halkin, 598 F.2d 176 (D.C.

Cir. 1979); Mokhiber v. Davis, 537 A.2d 1100, 1109 (D.C. 1988) (coilecting

cases).

A-24

The Supreme Court rejected the Seattle Times’s claim and

also rejected the suggestion that review of a protective order re-

quires any heightened scrutiny under the first amendment.

Although acknowledging that litigants do have limited first

amendment rights concerning information obtained through

discovery, the Court focused on the fact that discovery is “a mat-

ter of legislative grace” and that litigants gain access to discovery

materials “only by virtue of the trial court’s discovery processes.”

Id. at 31-32. Moreover, the Court said, protective orders “fur-

the[r] a substantial government interest unrelated to the sup-

pression of expression.” Jd. at 34. Thus, where “a protective order

is entered on a showing of good cause as required by Rule 26(c),

is limited to the context of pretrial discovery, and does not restrict

the dissemination of the information if gained from other

sources, it does not offend the first amendment.” Id. at 37.

As we said in Anderson v. Cryovac, Inc., 805 F.2d 1, 6-7 (Ist

Cir. 1986), the Seattle Times decision has not completely

eliminated the first amendment as a relevant consideration in

reviewing protective orders. Seattle Times has, however,

established that first amendment scrutiny of protective orders

“must be made within the framework of Rule 26(c)’s require-

ment of good cause.” Anderson, 805 F.2d at 7.

It is, therefore, very significant that Public Citizen has not

asserted a common law or first amendment right of access in-

dependent of the federal rules. Rather, Public Citizen has based

its claim on the federal rules, asserting that, under Rules 5(d)

andf 26(c), the public has a presumptive right of access to

discovery materials unless good cause for confidentiality is

shown, and that no good cause exists here. Nothing in Seattle

Times or Anderson precludes such a claim. Discovery is “a matter

of legislative grace,” 467 U.S. at 32, but Public Citizen asks for

no more than compliance with the legislative scheme embodied

in the federal rules.

In seeking to defeat Public Citizen's claim, Liggett and amici

Product Liability Advisory Council, Inc., and Motor Vehicle

Manufacturers Association of the United States. Inc., have

pointed to some expansive language in Seattle Times, Ander-

son and similar cases to bolster their claim that the public should

A-25

not be afforded access to discovery materials. See, e.g., Seattle

Times, 467 U.S. at 33 (“pretrial depositions and interrogatories

are not public components of a civil trial”); Mokhiber, 537 A.2d

at 1110 (“there exists no common law tradition of access to

discovery materials as such”). Liggett and amici have used these

statements to launch broad-based “policy” arguments to the ef-

fect that litigants have legitimate privacy interests in discovery

materials and that permitting public access would undermine

these privacy interests and excessively disrupt the litigation pro-

cess. We acknowledge that our own Anderson opinion seemingly

lends some support to this contention. 805 F.2d at 12 (permit-

ting public access to discovery might actually make the civil

discovery process “more complicated and burdensome than it

already is”); see also Marcus, Myth and Reality in Protective

Order Litigation, 69 Cornell L. Rev. 1 (1983) (generally criticiz-

ing claimed rights of public access to discovery).

We think, however, that these arguments and authorities are

misplaced here. All of the cases upon which Liggett and amici

rely are cases where the claimed right of access was based not

on the federal rules, but on the common law or the first amend-

ment. They are cases where, in essence, litigants put forth com-

mon law and constitutional arguments in an effort to trump

application of the federal rules standard for protective orders.

In rejecting such arguments and adhering to the federal rules

standard, courts sensibly have noted that a contrary result would

lead to thwarting the interests of privacy and litigative efficiency

which are embodied in the federal rules. But nothing in those

opinions purported to elevate privacy and efficiency as factors

to be considered over and above compliance with the federal

rules. Rather, the point of the cases was that, because of privacy

and efficiency concerns, the federal rules should be followed.

Thus, when in Anderson we noted that “[t]here was no tradi-

tion of public access to depositions before [passage of the federal

rules in] 1938,” we went on to say that now, under Rule 5(d),

courts may require public filing of discovery requests and

responses. 805 F.2d at 12. Likewise, in Alexander Grant & Co.

Litigation, the Eleventh Circuit recognized that, on the one

hand, “private litigants have protectable privacy interests in con-

fidential information disclosed through discovery,” but it added

A-26

that the means for protecting that privacy interest is Rule 26(c),

not judicial fiat. 820 F.2d at 355.

Liggett and amici would have us turn these cases on their

heads by holding that privacy and litigative efficiency concerns

ought to work independently of the federal rules, actually

limiting a district court’s ability to deny protection under Rule

26(c), even when no good cause is shown. We are not willing

to do so. This case involves a claim of access to discovery

materials under the federal rules and we believe that the merits

of the claim must be judged by the text of the rules and the ap-

plicable cases interpreting the rules. The rules themselves seek

to accommodate concerns of privacy and litigative efficiency,

and we find no reason for imposing additional judge-made con-

straints on the district court’s control of discovery. Accordingly,

we turn to consideration of the relevant federal rules.

Centrally at issue is Rule 26(c), which permits a district court

to issue protective orders covering discovery materials upon a

showing of good cause:

Upon motion by a party or by the person from

whom discovery is sought, and for good cause shown,

the court . . . may make any order which justice re-

quires to protect a party or person from annoyance,

embarrassment, oppression or undue burden or

expense... .

As the Second Circuit has noted,

A plain reading of the language of Rule 26(c)

demonstrates that the party seeking a protective order

has the burden of showing that good cause exists for

issuance of that order. It is equally apparent that the

obverse also is true, i.e., if good cause is not shown,

the discovery materials in question should not receive

judicial protection and therefore would be open to the

public for inspection. . . . Any other conclusion ef-

fectively would negate the good cause requirement of

Rule 26(c): Unless the public has a presumptive right

of access to discovery materials, the party seeking to

A-27

protect the materials would have no need for a judicial

order since the public would not be allowed to ex-

amine the materials in any event.

In re Agent Orange Product Liability Litigation, 821 F.2d 139,

145-46 (2d Cir.), cert. denied, 108 S. Ct. 289, 344 (1987), affg

104 F.R.D. 559, 567 (E.D.N.Y. 1986). Rule 26(c)’s good cause

requirement means that, “[a]s a general proposition, pretrial

discovery must take place in the public unless compelling reasons

exist for denying the public access to the proceedings.” American

Telephone & Telegraph Co. v. Grady, 594 F.2d 594, 596 (7th

Cir. 1978), cert. denied, 440 U.S. 971 (1979); accord, Wilk v.

American Medical Ass’n, 635 F.2d 1295, 1299 (7th Cir. 1980);

In re Coordinated Pretrial Proceedings in Petroleum Products

Antitrust Litigation, 101 F.R.D. 34, 38-41 (C.D. Cal. 1984); Note,

Nonparty Access to Discovery Materials in the Federal Courts,

94 Harv. L. Rev. 1085, 1085-86 (1981). Rule 26(c) thus lends sup-

port to the right of access claimed by Public Citizen and found

by the district court below.

We agree with the Second Circuit. It is implicit in Rule 26(c)’s

“good cause” requirement that ordinarily (in the absence of good

cause) a party receiving discovery materials might make them

public. In this instance, Public Citizen wished to relieve the

plaintiff of the burden of an order that prevented it from mak-

ing public previously obtained discovery materials. Given the

fact that Public Citizen directly benefitted from modification

of that order, and for the reasons previously pointed out, we

conclude that it had standing to intervene in the case and to

ask the court to modify its pre-existing protective order.

V. STANDARD FOR MODIFYING PROTECTIVE ORDERS

Although it is conceded that the governing standard for en-

try of a Rule 26(c) protective order is good cause, Liggett asserts

that a different standard ought to apply when a court considers

modifying an existing protective order. Liggett argues that

parties to a protective order have legitimate reliance interests

in its continued validity and finality. Citing to a Second Cir-

cuit opinion, Liggett claims that an existing protective order

A-28

can be modified only on a showing of “extraordinary cir-

cumstance or compelling need.” Martindell v. International

Telephone & Telegraph Corp., 594 F.2d 291 (2d Cir. 1979); see

also Palmieri v. New York, 779 F. 2d 861 (2d Cir. 1985). Not

surprisingly, Liggett finds that no extraordinary circumstances

are present here.

We think that Liggett’s argument must be rejected. Even ac-

cepting that an extraordinary circumstances standard applies,

we do not think that the district court erred in modifying the

protective order. Control of pretial discovery, including the en-

try or modification of a protective order, is a matter falling

peculiarly within the discretion of the district court. Agent

Orange, 821 F.2d at 147: Krause v. Rhodes, 671 F.2d 212, 219

(6th Cir.), cert. denied, 459 U.S. 823 (1982); Wilk v. American

Medical Ass’n, 635 F.2d 1295, 1299 (7th Cir. 1980); 8 C. Wright

& A. Miller, Federal Practice & Procedure § 2036, at 268 (1970).

Here, the district court found that the dismissal on the merits

constituted a significant change in circumstances warranting

modification of the protective order. Under the circumstances,

we cannot say that the court abused its discretion.

To begin with, the protective order modified by the district

court was a blanket protective order, that is, it was an order

extending broad protection to all documents produced by Lig-

gett, without a showing of good cause for confidentiality as to

any individual documents. Although such blanket protective

orders may be useful in expediting the flow of pretrial discovery

materials, they are by nature overinclusive and are, therefore,

peculiarly subject to later modification. See Manual for Com-

plex Litigation, Second § 21.431, at 53 & n.60 (1985); In re Coor-

dinated Pretrial Proceedings in Petroleum Products Antitrust

Litigation, 101 F.R.D. 34, 40-44 (C.D. Cal. 1984). Moreover,

as the district court made clear in rejecting pretrial attempts

to modify the protective order, the point of this protective order

was to promote a fair trial, not to guarantee Liggett perpetual

secrecy. See supra at 5 (“The dissemination of this material wil]

not aid in the fair trial of this case. The trial is public and the

Wall Street Journal is, of course, able to attend the trial.”). The

dismissal of the case on the merits eliminated the possibility of

A-29

trial and was, therefore, a significant change in circumstances

calling into question the necessity of the protective order. Under

similar circumstances, the Second Circuit — the very court that

crafted it — found that the extraordinary circumstances test was

met. Agent Orange, 82] F.2d at 147-48 (upholding the district

court’s modification of a blanket protective order in light of a

settlement of the underlying dispute).

It is argued that a protective order of this sort may lead a

party to be more forthcoming in discovery. A protective order

may induce a party, for example, to permit an opponent to go

through its files, taking relevant material. The party would not

insist upon screening the materials first because it would not

fear that irrelevant or confidential material, protected by the

order, would be made public. Insofar as a rationale of this sort

underlay the original protective order, it would seem unfair later

to remove that order’s protection.

We do not accept this argument as controlling here, however,

for one simple reason. As far as we can tell from this record,

the particular documents that Public Citizen seeks are not

documents that were irrelevant to the litigation nor do they con-

tain trade secrets or other specially confidential material. In-

sofar as it applies to the documents they seek, the protective order

did not rest upon the rationale just mentioned. Rather, the court

initially protected those documents for a very different reason:

namely, the court, believing that the documents would become

public in any event during trial, wished to conduct that trial

free of the pretrial publicity that might follow premature release

of the documents. Liggett, of course, remained free, in respect

to any particular document, to argue to the district court that

the document in question either was irrelevant to the discovery

request or should remain protected as a confidential document

for some special reason (such as “trade secrets”) that would have

prevented its having been made public at trial.

Moreover, we are not convinced that the extraordinary cir-

cumstances standard proffered by Liggett is applicable here in

any event. For one thing, the Martindell case principally relied

upon by Liggett is clearly distinguishable, having been based

on policy concerns not applicable here. Martindell involved an

A-30

attempt by the United States government as prosecutor to short

cut its normal investigative procedures by obtaining sealed

depositions in a shareholder derivative suit to which it was not

a party. Pointing out the reliance interests of witnesses who

testified pursuant to the protective order without invoking their

fifth amendment right against self-incrimination, the Second

Circuit refused to modify the protective order. 594 F.2d at

294-97; see also Palmieri, 779 F.2d at 863-66 (applying Mar-

tindell standard and denying a request by New York State to

intervene in a private antitrust action to access sealed

documents). “[W]hat was critical to Martindell _. . was the fact

that ‘the party seeking access ... was the federal government,

which ... had at its disposal special investigatory powers not

available to private litigants. ...’” Palmieri, 779 F.2d at 866

(quoting Wilk, 635 F.2d at 1299-1300). This case, of course, does

not involve government intervention and so, even according to

the Second Circuit, the justification for the extraordinary cir-

cumstances test is not present.

Outside the area of government intervention, courts have ap-

plied much more lenient standards for modification. See e.g.,

Wilk, 635 F.2d at 1300 (holding that the court’s prior invocation

of the extraordinary circumstances test “was an unfortunate choice

of words”); Tavoulareas v. Washington Post Co., 737 F.2d 1170,

1172 (D.C. Cir. 1984) (suggesting that the good cause standard

of Rule 26(c) governs modifications of protective orders). While

we need not decide the matter definitively, we reject the “extraor-

dinary circumstances” standard. In a case such as this, where

the party seeking modification has pointed to some relevant

change in the circumstances under which the protective order

was entered, we think that a standard less restrictive than “ex-

traordinary circumstances” is appropriate. We need not define

how “less restrictive” the standard should be because we find that

under these facts the district court had the legal power to modify

its prior protective order: the reasons underlying the initial pro-

mulgation of the order in respect to the particular documents

sought no longer exist; and the district court made a reasoned

determination that public interest considerations favored allow-

ing counsel to make those particular documents public.

A-31

VI. CONCLUSION

The district court’s order is affirmed with respect to the

modification of the protective order, but reversed with respect

to the requirement that the parties file discovery materials in

court. The parties are, therefore, free to disseminate discovery

materials, but they are not obligated to make them publicly

available by filing them in court.

So erdered.

B-1

Opinion of the Court of Appeals,

dated August 25, 1987

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER and

DAPHNE S. PALMER,

Plaintiffs-Appellees,

— Y, —

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CoO., INC.,

Defendants-Appellants.

No. 86-1525

United States Court of Appeals,

First Circuit

Decided August 25, 1987

Before: BOWNES, Circuit Judge, BROWN,” Senior

Circuit Judge, and TORRUELLA, Circuit

Judge

BROWN, Senior Circuit Judge:

This interlocutory appeal presents one highly disputed issue:

whether the Federal Cigarette Labeling and Advertising Act,

15 U.S.C. § 1331 et seq. (the Act), preempts the Palmers’ smok-

ing and health related claims that challenge either the adequacy

* Of the Fifth Circuit, sitting by designation.

B-2

of the federal warning on cigarette packages or the propriety

of Liggett’s advertising and promotion of cigarettes. In deference

to the congressional declaration that (i) cigarettes be labeled

uniformly and (ii) a balance be struck between the priority given

to tobacco commerce and to our national health policy, we hold

that the Act does preempt the Palmers’ state law claims, and

reverse the decision of the District Court.

A Saga of Cigarette Smoking

Because the certified issue before us is on appeal from a mo-

tion to dismiss, we are limited to viewing the facts of the case

only as alleged in the pleadings, interrogatory answers, and pre-

trial submissions of the parties.

Joseph C. Palmer died on August 26, 1980, at the age of 49,

allegedly from lung cancer. The Palmers allege that Palmer

smoked between three and four packs of Liggett’s cigarettes per

day until his death.

On August 19, 1983, Ann M. Palmer, individually and as ad-

ministrator of the estate of her late husband, and her mother-

in-law, Daphne S. Palmer, filed this diversity action in the

District Court. In their amended complaint, the Palmers con-

tended that liability should be imposed on Liggett because of

its failure to warn adeauately of the health consequences of

cigarette smoking. The Palmers asserted causes of action for com-

mon law negligence, breach of warranty under Mass. Gen. Laws

c. 106 § 2-314 et seq., and violations of the Massachusetts Con-

sumer Protection Act, Mass. Gen. Laws c. 93A. At bottom, the

Palmers complained that Liggett negligently gave inadequate

warnings about the dangers of cigarette smoking and that this

negligence proximately caused Palmer’s death.

In response, Liggett filed a motion to dismiss all inadequate

warning claims on the ground that they were preempted by the

Act. After a thorough review of the record, Judge Mazzone

denied Liggett’s motion to dismiss. The court concluded that

“Congress [could not have] meant, by its silence on the issue

of common law claim preemption, to do away with all means

lee

B-3

of obtaining compensation for those hurt by inadequate cigarette

warnings in advertising.” Palmer v. Liggett Group, Inc., 633

F. Supp. 1171, 1173 (D. Mass. 1986). The District Court also relied

heavily on the analysis contained in Judge Sarokin’s opinion in

the District Court decision of Cipollone v. Liggett Group, Inc.,

593 F. Supp. 1146 (D.N.J. 1984), since reversed, 789 F.2d 18]

(3d Cir. 1986), cert. denied, ___ U.S. ___, 107 S. Ct. 907, 93

L.Ed.2d 857 (1987).

Because Judge Mazzone found the preemption issue to involve

“a controlling question of law,” 28 U.S.C. § 1292(b), he certified

sua sponte this issue for interlocutory appeal, which we have ac-

cepted. Upon application by Liggett to this court, the proceedings

below have been stayed while this limited appeal comes to us.

The Act

The District Court, the defendants, and the plaintiffs agree

that the issue of the Act’s preemptive force controls the disposi-

tion of virtually the entire case. If the Labeling Act is found

to preempt state law actions, either expressly or impliedly, the

Palmers lose. If Congress did not intend for the Act to be so

preemptive, Liggett loses the appeal. The line thus drawn, we

proceed now to a discussion of how Congress constructed the

Labeling Act.

In 1964, the Surgeon General released the now famous “Smok-

ing and Health: Report of the Advisory Committee to the

Surgeon General.” That initial report was one of the first of-

ficial, scientifically approved statements linking cigarette smok-

ing to lung cancer, bronchitis, and emphysema. The public

response was immediate and vocal; clearly, some form of govern-

mental action was imminent.

In a rush to protect and inform its citizens, several states pro-

posed and adopted mandatory warning labels for cigarette

packages to be sold in their individual states! Given the

' For example, the New York state legislature adopted the following label in

June 1965: “WARNING: Excessive Use Is Dangerous To Health.” Laws of New

York 1965, Ch. 470.

B-4

potential maze of conflicting state regulations, Congress stepped

in in 1965 to set up a uniform, nationally consistent system of

warning labels for cigarettes. F urther, it did so with the express

intention of striking a balance between its concern for the na-

tional health policy of smoking education and its protection of

the trade and commerce aspects of the tobacco industry.”

After much internal and external debate, with classic con-

frontations between North and South, rural and urban states,

together with vigorous lobbying by all forms of interested groups

and businesses, the members of Congress negotiated a hard-

fought compromise with the passage of the Federal Cigarette

Labeling and Advertising Act, Pub. L. No. 89-92, 79 Stat. 282

(1965), codified as amended by the Public Health Cigarette

Smoking Act of 1969, Pub. L. No. 91-222, 84 Stat. 87 (1970)

at 15 U.S.C. §§ 133] et seq. In 1984, Congress further amended

the Act by the Comprehensive Smoking Education Act, Pub. L.

No. 98-474, 98 Stat. 2200 (1984).°

This case, like so many we are called on to decide, turns on

a question of statutory construction and interpretation. It is by

definition a frustrating task, for if the law’s meaning is truly

“plain” enough or its effect clear-cut enough, there is no need

for us to pronounce what we discern its meaning or effect to

be. In cases such as this one, however, we must marshal sup-

port from the ready arsenal of the canons of statutory construc-

tion to declare soberly the deconstructed meaning of the omis-

sion by Congress of a Savings clause, “because Congress knew

how to provide a savings clause when it wanted to.” We are ex-

pected to “discover” the true congressional intent of the phrase

“No requirement shall be imposed under State law.” yet we are

limited to contradictory, even self-serving language from the

statute's legislative history to discern that intent.

* At the time the Act was originally adopted, tobacco ranked third in

agricultural export products, fifth among all cash crops, and supported some

750,000 farming families. See 1] Cong. Rec. 13,950, 13,898 (1965) (remarks

of Sens. Ervin and Bass).

’ The amendments enacted in 1984 took effect after Joseph Palmer's death,

and therefore are not relevant in this case.

B-5

Nevertheless, that is the task assigned to us, and having

acknowledged the inherently unsatisfying nature of it, we come

now to the actual words of the law. In some ways, the Act is

more straightforward in declaring its intent and effect than are

many other analogous regulatory schemes. The Act contains

three sections that address the preemption issue raised here. First

is § 1331, the Act’s declaration of policy and purpose.

It is the policy of the Congress, and the purpose of

this chapter, to establish a comprehensive Federal pro-

gram to deal with cigarette labeling and advertising

with respect to any relationship between smoking and

health, whereby —

(1) The public may be adequately informed that

cigarette smoking may be hazardous to health by

inclusion of a warning to that effect on each

package of cigarettes; and

(2) commerce and the national economy may be (A)

protected to the maximum extent consistent with

this declared policy and (B) not impeded by

diverse, nonuniform, and confusing cigarette

labeling and advertising regulations with respect

to any relationship between smoking and health.

15 U.S.C. § 1331.4

Second, § 1333 prescribes the exact label of warning to be

placed on each package of cigarettes.’ The language imposing

this mandatory warning is as follows:

* Subparagraph (1) of § 1331 was amended in 1984 to read:

(1) the public may be adequately informed about any adverse

health effects of cigarette smoking by inclusion of warning notices

on each package of cigarettes and in each advertisement of

cigarettes; and ...

15 U.S.C. § 1331(1) (West Supp. 1987).

* The very fact that Congress mandated the precise wording required in a

label, rather than merely establishing the “minimum requirements” standard

(footnote continued)

B-6

It shall be unlawful for any person to manufacture,

import, or package for sale or distribution within the

United States any cigarettes the package of which fails

to bear the following statement: “Warning: The

Surgeon General Has Determined That Cigarette

Smoking Is Dangerous to Your Health.” Such state-

ment shall be located in a cunspicuous place on every

cigarette package and shall appear in conspicuous and

legible type in contrast by typography, layout, or color

with other printed matter on the package.

15 U.S.C. § 1333.°

often found in labeling acts distinguishes the Act from cases relied upon by

the court and the Palmers as persuasive authority. See, e.g., Ferebee v. Chevron

Chemical Co., 736 F.2d 1529 (D.C. Cir.) (involving FIFRA minimum label-

ing standards), cert. denied, 469 U.S. 1062, 105 S. Ct. 545, 83 L.Ed.2d 432

(1984), and discussion infra at note 13.

* When Congress originally enacted the Act in 1965, and when the link to

the hazards of smoking was less firmly established, the warning was a more

moderate statement: “Caution: Cigarette Smoking May Be Hazardous to Your

Health.” Pub. L. No. 89-92, § 4, 79 Stat. 282, 283 (1965).

In 1984, Congress extensively revised the labeling requirements that were

in force under the 1969 amendments. Although the 1969, not 1984, warnings

are controlling in this case, the Palmers have relied upon the most recent

amendments as evidence of the inadequacy of the prior warnings. For infor-

mation purposes, we set them out below:

[1] SURGEON GENERALS WARNING: Smoking Causes Lung

Cancer, Heart Disease, Emphysema, And May Complicate

Pregnancy.

[2] SURGEON GENERALS WARNING: Quitting Smoking Now

Greatly Reduces Serious Risks to Your Health.

[3] SURGEON GENERALS WARNING: Smoking By Pregnant

Women May Result in Fetal Injury, Premature Birth, and Low

Birth Weight.

[4] SURGEON GENERALS WARNING: Cigarette Smoke Con-

tains Carbon Monoxide.

15 U.S.C. § 1333(a)(1) (West Supp. 1987).

B-7

Finally, § 1334 sets out the section most relevant to our

preemption analysis — the preemption section:

(a) No statement relating to smoking and health,

other than the statement required by section 1333

of this title, shall be required on any cigarette

package.

(b) No requirement or prohibition based on smoking

and health shall be imposed under State law with

respect to the advertising or promotion of any

cigarettes the packages of which are labeled in

conformity with the provisions of this chapter.

15 U.S.C. § 1334.’

The remainder of the Act includes sections that prohibit radio

and television advertising (§ 1335), require manufacturers to

report cigarette ingredients to the Secretary of the Department

of Health and Human Services (§ 1335a), and require the HHS

Secretary to report to Congress annually about developments

in “the current information in the health consequences of smok-

ing” (§ 1337). Further, § 1337 also requires the Federal Trade

Commission to report to Congress regarding its opinions on the

effectiveness of cigarette labeling and the impact of advertis-

ing and marketing, along with any recommendations the FTC

may desire to make. Sections 1338 and 1339 confer jurisdiction

on the District Courts to enjoin violations of the Act, and pro-

vide for criminal penalties of not more than $10,000.

The Preeminence of Preemption

Having set out the relevant portions of the Act. we now con-

sider the preemptive force that it brings to bear on the Palmers’

state-based tort claim.

’ Section 1334(b) of the original 1965 Act read as follows:

No statement relating to smoking and health shall be required

in the advertising of any cigarettes the packages of which are

labeled in conformity with the provisions of this Act.

Se

B-8

The different forms of preemption are usually summarized

by neat citations to familiar Supreme Court authority. Although

we are somewhat wary that these ready citations list, but do

not describe, and catalog, but do not define, any real distinc-

tions among the various types of preemption, we nevertheless

offer the following recitation from the Court in Louisiana Public

Service Comm'n v. Federal Communications Comm'n, 476

U.S. ___, 106 S. Ct. 1890, 90 L.Ed.2d 369 (1986).

The Supremacy Clause of Article VI of the Constitu-

tion provides Congress with the power to pre-empt

state law. Pre-emption occurs when Congress, in

enacting a federal statute, expresses a clear intent to

pre-empt state law, Jones v. Rath Packing Co., 430

U.S. 519, 97 S. Ct. 1305, 51 L.Ed.2d 604 (1977), when

there is outright or actual conflict between federal and

state law, e.g., Free v. Bland, 369 U.S. 663, 82 S. Ct.

1089, 8 L.Ed.2d 180 (1962), where compliance with

both federal and state law is in effect physically im-

possible, Florida Lime & Avocado Growers, Inc. v.

Paul, 373 U.S. 132, 83 S. Ct. 1210, 10 L.Ed.2d 1082

(1963), where there is implicit in federal law a bar-

rier to state regulation, Shaw v. Delta Air Lines, Inc.,

463 U.S. 85, 103 S. Ct. 2890, 77 L.Ed.2d 490 (1983),

where Congress has legislated comprehensively, thus

occupying an entire field of regulation and leaving

no room for the States to supplement federal law, Rice

v. Santa Fe Elevator Corp., 331 U.S. 218, 67 S. Ct.

1146, 91 L.Ed. 1447 (1947), or where the state law

stands as an obstacle to the accomplishment and ex-

ecution of the full objectives of Congress. Hines v.

Davidowitz, 312 U.S. 52, 61 S. Ct. 399, 85 L.Ed. 581

(1941).

* * +

The critical question in any pre-emption analysis is

always whether Congress intended that federal regula-

tion supersede state law.

476 U.S. at

, 106 S. Ct. at 1898-99, 90 L.Ed.2d at 381-82.

B-9

The District Court Opinion

In its thoughtful and detailed scrutiny of this case, the District

Court considered at length the reasoning in the three major opin-

ions rendered to date in these cigarette products liability cases

— the two Cipollone decisions, 593 F. Supp. 1146 (D.N.J. 1984)

(Sarokin, J.), revd, 789 F.2d 181 (3d Cir. 1986) (Hunter, J.), cert.

denied, __ U.S. _, 107 S. Ct. 907, 93 L.Ed.2d 857 (1987), and

Roysdon v. R.J. Reynolds Tobacco Co., 623 F. Supp. 1189 (E.D.

Tenn. 1985). The Third Circuit and Roysdon courts held that

the Act preempted state law tort claims, while the District Court

in Cipollone held the claims were not preempted.

After reviewing the basic approaches to preemption analysis,

the District Court considered and rejected the argument that

either express or any of the forms of implied preemption were

present in this case. We reverse and hold that the Act impliedly

preempts the Palmers’ claim.

Judge Mazzone first discussed express preemption. Because

that type of preemption has been so strictly construed in the

past, and because of the strong presumption against preemp-

tion, Maryland v. Louisiana, 451 U.S. 725, 746, 101 S. Ct. 2114,

2128, 68 L.Ed.2d 576, 595 (1981), it is unnecessary to disturb

the court’s conclusion that there is no express preemption pre-

sent. Because we have no hesitation in determining that the Act

impliedly preempts (under whatever rubric) the Palmers’ claim,

we need not overturn the District Court’s view that the preemp-

tion section of the Act does not explicitly enough preempt state-

based claims to be “expressly ” preemptive.

The parties have focused their express preemption arguments

on vigorous debates over the significance of the fact that there

is neither a clause explicitly preempting state claims’ nor a “sav-

ings clause” expressly preserving them.® Rather than wade into

” See, e.g., Copyright Act of 1976, 17 U.S.C. § 301(a); Employee Retirement

Income Security Act of 1974, 29 U.S.C. § 1144(a) & (c)(1); Domestic Housing

and International Recovery and Financial Stability Act, 12 U.S.C.

§§ 1715z-17(d), 1715z-18(e).

* See, e.g., Copyright Act of 1976, 17 U.S.C. § 301(b); Occupational Safety

and Health Act of 1970, 29 U.S.C. § 653(b)(4).

B-10

the bog of doublespeaking legislative history to divine congres-

sional intent from words not used, we simply acknowledge that

the preemption section reads “no requirement . . . shall be im-

posed under State law,” not “State-based tort claims are hereby

preempted.”

The opinion next discusses the subtypes of implied preemp-

tion. Although the District Court broke down implied preemp-

tion into four categories — occupation of the field, conflict, im-

possibility, and frustration of purpose, we do not find such labels

necessarily helpful, and certainly do not deem them deter-

minative in ascertaining preemption. Rather, the gist of preemp-

tion is whether Congress (expressly) did or (impliedly) meant

to displace state law or state law concepts in enacting the federal

law. Thus, instead of attempting to fit the Act into some pre-

cast mold of “impossibility” or “frustration,” we look to the ef-

fect the Palmers’ suit will" have on the federal scheme set up

by Congress. If the state law disturbs too much the congressional-

ly declared scheme — whether denominated as “occupying the

field” or “actually conflicting with federal law” — it will be

displaced through the force of preemption.

In this case, Congress has eased our task of figuring out its

intent by including both a statement of purpose and a preemp-

tion section. Because the language of the Act is straightforward

and unambiguous, we need not resort to legislative history to

determine congressional intent. “Reliance on legislative history

in divining the intent of Congress is, as has often been observ-

ed, a step to be taken cautiously.” See American Tobacco Co.

v. Patterson, 456 U.S. 63, 75, 102 S. Ct. 1534, 1540, 71 L.Ed.2d

748, 759 (1982); New England Power Co. v. New Hampshire,

As part of its express preemption discussion, the court held that compen-

satory damages could not act as extra-statutory “regulation,” so as to be ex-

pressly preempted. We need not decide whether such damages constitute ex-

press or implied preemption. Rather, as we discuss infra at 18-19, we simply

note here that, contrary to the District Court’s conclusion, we do view com-

pensatory damages as potentially regulatory in nature.

" The harm of the state law on the federal scheme should be actual, not poten-

tial. See Rice v. Norman Williams Co., 458 U.S. 654, 659, 102 S. Ct. 3294,

3298, 73 L.Ed.2d 1042, 1049-50 (1982).

B-11

455 U.S. 331, 342, 102 S. Ct. 1096, 1102, 71 L.Ed.2d 188, 197

(1982); Piper v. Chris-Craft Industries, 430 U.S. 1, 26, 97 S. Ct.

926, 941, 51 L.Ed.2d 124, 143 (1977).

In adopting the Act, Congress explicitly announced a two-

pronged purpose. It plainly sought to inform the public that

“cigarette smoking may be hazardous to health by inclusion of

a warning to that effect.” The educational purpose, however,

was tempered by a consideration that “commerce and the na-

tional economy .. . [be] protected to the maximum extent con-

sistent with this declared policy.” Further, commerce was to be

unimpeded by “diverse, nonuniform and confusing cigarette

labeling” regulations. 15 U.S.C. § 1331(1) & (2). Stated different-

ly, in drafting the Act, Congress had two policies — health pro-

tection (through education) and trade protection — to imple-

ment, but only one purpose: to strike a fair, effective balance

between these two competing interests. The result is an Act that

“represents a carefully drawn balance between the purposes of

warning the public of the hazards of cigarette smoking and pro-

tecting the interests of national economy.” Cipollone, 789 F.2d

at 187.

It is these policies, and more importantly, the balance fixed

between them that is our focus. The language of § 1331 even

measures the relative weight of the policies: the federal warn-

ing should protect commerce “to the maximum extent” consis-

tent with its health policy. Thus, we consider now the effect

of the introduction of a state tort claim into this congressional-

ly calibrated system. As discussed earlier, Congress ran a hard-

fought, bitterly partisan battle in striking the compromise that

became the Act. It is inconceivable that Congress intended to

have that carefully wrought balance of national interests

superseded by the views of a single state, indeed, perhaps of a

single jury in a single state. Contrary to the District Court’s view,

we therefore hold that a suit for damages on a common law

theory of inadequate warning — if the warning given complies

with the Act — disrupts excessively the balance of purpose set

by Congress, and is thus preempted.

To permit the interposition of state common law actions into

a well-defined area of federal regulation would abrogate utterly

B-12

the established scheme of health protection as tempered by trade

protection. The Supremacy Clause of the Constitution, as en-

forced through the doctrine of preemption, prohibits this.

The Remaining Contentions

Having held that the Act impliedly preempts the Palmers’ suit

because it disturbs the federally calibrated balance of national

interests, we briefly address other issues discussed by the District

Court or raised by the Palmers on appeal.

First, the Palmers argue, and the District Court agreed, that

to prohibit such state-based tort suits would effectively — and

wrongly — leave plaintiffs like the Palmers without any remedy

for their injuries. Relying on Justice White's statement in

Silkwood v. Kerr-McGee Corp., 464 U.S. 238, 104 S. Ct. 615,

78 L.Ed.2d 443 (1984) that, “it is difficult to believe that Con-

gress would, without comment, remove all means of judicial

recourse for those injured by illegal conduct,” 464 U.S. at 251,

104 S. Ct. at 623, 78 L.Ed.2d at 454, the Palmers argue that

allowing the Act to preempt traditional state tort compensation,

an area traditionally left to the states for regulation, is an im-

permissible overreading of the Act.

We reject this argument for several reasons. First, cigarette

smoking, at least initially, is a voluntary activity. In the cases

relied on by the Palmers in which state remedies were not

preempted, the victims had little or no choice in their participa-

tion in the regulated fields. See, e.g., Silkwood (nuclear energy

development); United Construction Workers v. LaBurnum Con-

struction Corp., 347 U.S. 656, 74 S. Ct. 833, 98 L.Ed. 1025 (1959)

(employment). Second, the Supreme Court has often left par-

ties without a remedy by finding state common law preemp-

ted. See Chicago ¢- NW Transp. Co. v. Kalo Brick & Tile Co.,

450 U.S. 311, 101 S. Ct. 1124, 67 L.Ed.2d 258 (1981) (finding

that the Interstate Commerce Act preempts state common law

action for damages against a regulated railroad); Farmers Union

v. WDAY, 360 U.S. 525, 79 S. Ct. 1302, 3 L.Ed.2d 1407 (1959)

(finding that the Federal Communications Act preempts state

libel claim against a radio station). There is no constitutional

requirement that a federal law cutting off state remedies “either

B-13

duplicate the recovery at common law or provide a reasonable

substitute remedy.” Duke Power Co. v. Carolina Envtl. Study

Group, Inc., 438 U.S. 59, 88, 98 S. Ct. 2620, 2638, 57 L.Ed.2d

595, 620 (1978).

The Palmers also contend, and the District Court agreed, that

“the effect of compensatory awards on defendants’ behavior is

indirect and not regulatory in nature.” We reject this

characterization.

The preemption clause of the Act expressly prohibits “state

law,” not merely “statutory law” from imposing any “require-

ment or prohibition” different from the Act’s warning label. 15

U.S.C. § 1334. If a manufacturer’s warning that complies with

the Act is found inadequate under a state tort theory, the

damages awarded and verdict rendered against it can be view-

ed as state regulation: the decision effectively compels the

manufacturer to alter its warning to conform to different state

law requirements as “promulgated” by a jury’s findings

More than that, the practicalities of modern litigation would

inevitably involve conflict between the congressionally ordain-

ed warning and the common law label argued for by the plain-

tiffs. A trial court would not merely submit the question of

whether the warning was adequate. Evidence pro and con would

have to be offered, including specific examples of what sort of

warning reasonably was called for, how it was to be given, and

the like. Following the close of evidence, the trial court would

have to submit the issue to the jury. In a federal court — as is

this case — the judge, either under a general charge or one on

special interrogatories under F. R. Civ. P. 49(a), would have to

submit the question of warning with precision. This would be

necessary so that a reviewing court could determine whether

or not the warning fixed by the jury conflicted with the statutory

warning. This challenge to the federal warning label's sufficiency

— and the confusion it would engender — surely contravenes

the Act’s policy of uniform labeling.

The District Court held that an award of damages “would

have only an indirect effect on defendant’s labeling and advertis-

ing practices.” 633 F. Supp. at 1177. The Palmers disingenuously

B-14

maintain that any monetary damages awarded would not com-

pel a manufacturer to change its label for, after all, “the choice

of how to react is left to the manufacturer.” This “choice of reac-

tion”seems akin to the free choice of coming up for air after be-

ing underwater. Once a jury has found a label inadequate under

state law, and the manufacturer liable for damages for negligent-

ly employing it, it is unthinkable that any manufacturer would

not immediately take steps to minimize its exposure to continued

liability. The most obvious change it can take, of course, is to

change its label. Effecting such a change in the manufacturer’s

behavior and imposing such additional warning requirements

is the very action preempted by § 1334 of the Act. Indeed, it

arrogates to a single jury the regulatory power explicitly denied

to all fifty states’ legislative ‘sodies.

Further, the Supreme Court itself has long acknowledged this

power.

[Regulation can be as effectively exerted through an

award of damages as through some form of preven-

tive relief. The obligation to pay compensation can

be, indeed is designed to be, a potent method of

governing conduct and controlling policy.

San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 247,

79 S. Ct. 773, 780, 3 L.Ed.2d 775, 784 (1959). Thus, the

regulatory effect of the Palmers’ claim is direct, and must be

preempted by the Act.

In addition, given the substantial differences in subject mat-

ter, we dismiss as unpersuasive the analogies made by the Palmers

and the District Court to the Silkwood case. The District Court

evidently believed that Garmon’s reasoning had been discredited

by the Supreme Court’s decision in Silkwood — even though

nothing in Silkwood even remotely suggests that Garmon has

been qualified or overruled, and even though the Court in

Silkwood stated that federal law will “preempt the recovery of

damages based on state law” whenever “imposition of a state

standard in a damages action would frustrate the objectives of

the federal law.” 464 U.S. at 256, 104 S. Ct. at 626, 78 L.Ed.2d

at 457-58.

B-15

First, the District Court did not even mention the fact that

the Atomic Energy Act of 1954, 42 U.S.C. § 2011] et seq., at issue

in Silkwood, contains no preemption provision whatever.

Moreover, while the Atomic Energy Act has been read by the

Supreme Court by implication to confer exclusive federal

jurisdiction to regulate issues of nuclear safety, the Act also ex-

pressly reserves significant authority to the states.”

In contrast, the “comprehensive Federal program” established

by the Act contains a sweeping preemption provision, and con-

spicuously fails to provide any role for the states in the area of

cigarette labeling and advertising. Further, the enactment and

legislative history of the Atomic Energy Act, as amended by the

Price-Anderson Act, Pub. L. No, 85-256, 71 Stat. 576, make clear

Congress’ explicit judgment that state common law damage ac-

tions for injuries caused by nuclear operations should be per-

mitted to continue. See Silkwood, 464 U.S. at 251-56, 104 S.

Ct. at 623-25, 78 L.Ed.2d at 454-57. For that reason, it was

the starting place in Silkwood, and common ground among all

the parties (as well as among all the Justices of the Supreme

Court), that state common law damage actions were not

preempted; the only issue was the much more refined question

of whether punitive damages (as opposed to compensatory

damages) were preempted. The Court’s 5-4 decision — that

punitive damages were not preempted — was based on the

unremarkable conclusion that such damages are part and parcel

of the “traditional state tort law” that Congress had decided

to preserve within the AEA’s regulatory scheme. Id. at 255, 104

S. Ct. at 625, 78 L.Ed.2d at 457.

Silkwood thus took for granted the answer to the issue that

is the central controversy here. It therefore sheds no light at all

on the fundamental question in this case — whether state

2 See, e.g., 42 U.S.C. § 2018 (AEA does not affect state authority with respect

to generation, sale, or transmission of electric power through use of federally-

licensed nuclear facilities); 42 U.S.C. § 202l(b) (federal-state agreements

authorized so that states may assume regulatory authority over certain nuclear

materials); 42 U.S.C. § 202l(k) (section does not affect state authority to

regulate activities for purposes other than protection against radiation hazards)

B-16

common law damage actions based on alleged failure to pro-

vide adequate warnings are permissible in the first instance.”

The Last Puff

Accordingly, having dismissed the Palmers’ arguments against

preemption as meritless, and having determined the effects of

state tort liability to be seriously disruptive to the congressionally

calibrated balance of national interests, we hold the Palmers’

state-based claim of inadequate warning to be preempted by

the Act. The decision of the District Court must be reversed and

remanded for proceedings consistent with this opinion.

REVERSED AND REMANDED.

° The only preemption case cited by the District Court was Ferebee v. Chevron

Chemical Co., 736 F.2d 1529 (D.C. Cir.), cert. denied, 469 U.S. 1062, 105 S.

Ct. 545, 83 L.Ed.2d 432 (1984), in which the Court-of Appeals held that

Maryland tort claims were not preempted by the Federal Insecticide, Fungicide,

and Rodenticide Act (FIFRA), 7 U.S.C. § 136 et seq. FIFRA, which applies

to some 40,000 different herbicide and pesticide formulations, imposes an en-

tirely different type of regulatory scheme from that established under the Act.

See 16 Env’t Rep. (BNA) 9 (May 3, 1985). Under FIFRA, each manufacturer

drafts a warning label for each product for EPA approval. Thus, two manufac-

turers of the same regulated product may use different labels of their own

choosing, provided only that they obtain prior EPA approval. Further, the

statute in Ferebee permits “states to impose more stringent constraints on the

use of EPA-approved pesticides than those imposed by the EPA,” indicating

that Congress was indifferent to regulation of these products through state

tort law. Ferebee, 736 F.2d at 1541. In contrast, the Act explicitly (i) applies

to cigarettes only; (ii) mandates the precise language of the label; and (iii)

prohibits any state from regulating any aspect of cigarette warnings. The

analogy to Ferebee must fail

C-]

Judgment of the District Court,

dated October 7, 1987

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER and

DAPHNE S. PALMER,

Plaintiffs.

V,

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC..

Defendants.

Civil Action No. 83-2445-MA

JUDGMENT

MAZZONE, D.].

In accordance with the Court’s allowance of the defendants’

motion for entry of judgment on October 6, 1987 in the above

entitled action, it is hereby ORDERED

Judgment for the defendants.

Complaint dismissed.

By the Court,

October 7. 1987 s/ Helen M. Costello

Deputy Clerk

D-1

Order of the Court of Appeals,

dated April 11, 1988

ANN M. PALMER, as Adruinistratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs-Appellees,

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC

*s

Defendants-Appellants

No. 88-1195

United States Court of Appeals,

First Circuit

ORDER OF COURT

Entered: April 11, 1988

Upon consideration of “appellants’ Motion To Substitute Real

Parties In Interest As Appellees” and without opposition,

It is ordered that the motion be granted and the case caption

be reformed so that the appellees are Public Citizen, Et Al.

appellees.

By the Court:

/s/ Francis P. Scigliano

Clerk.

F-1

Handwritten Order of the District Court accompanying

Motion of Public Citizen et al. to Order Filing

and to Modify Protective Order, dated January 28, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs.

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

MOTION OF PUBLIC CITIZEN, AMERICAN CANCER

SOCIETY, AMERICAN HEART ASSOCIATION, AMERICAN

LUNG ASSOCIATION, AND AMERICAN PUBLIC HEALTH

ASSOCIATION TO ORDER FILING OF DISCOVERY

MATERIALS AND TO MODIFY PROTECTIVE ORDER

Public Citizen, the American Cancer Society, the American

Heart Association, the American Lung Association, and the

American Public Health Association (the “movants”) respectively

move the Court to enter an order directing the parties to file

all materials obtained in discovery with the Clerk and to modify

the protective order entered by this Court on 25 February 1985

in order to permit greater public access to these materials. The

memorandum of law accompanying this motion explains more

E-2

fully the reasons for seeking this relief, which is authorized

specifically under Rule 16(g) of the Rules of this Court.

Respectfully submitted,

s/ Carolyn Grace

Carolyn Grace

Shapiro & Grace

79 Milk Street

Boston, Mass. 02109

(617) 451-2155

s/ Cornish F. Hitchcock

Cornish F. Hitchcock

Alan B. Morrison

Public Citizen Litigation Group

2000 P Street, N.W., Suite 700

Washington, D.C. 20036

(202) 785-3704

Attorneys for Public Citizen et al.

December 1987

MOTION ALLOWED, for reasons stated at hearing.

/s/ A. David Mazzone

US.D.J.

1/28/88

F-]

Handwritten Order of the District Court accompanying

Motion of Public Citizen et al. to Order Parties

to Maintain Discovery Materials, dated December 28, 1987

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

a V. —

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

MOTION OF PUBLIC CITIZEN, AMERICAN CANCER

SOCIETY, AMERICAN HEART ASSOCIATION, AMERICAN

LUNG ASSOCIATION, AND AMERICAN PUBLIC HEALTH

ASSOCIATION TO ORDER PARTIES TO MAINTAIN AND

NOT TO DESTROY OR RETURN DISCOVERY MATERIALS

Public Citizen, the American Cancer Society, the American

Heart Association, the American Lung Association, and the

American Public Health Association (the “movants”) respectively

move the Court to enter an order directing the parties to main-

tain intact and not to destroy or return to opposing counsel the

discovery materials in this case. As explained in the attached

memorandum, this relief is sought because counsel for the par-

ties must destroy or return these materials within 45 days from

the conclusion of this litigation under the terms of a protective

order entered by this Court on 25 February 1985, and the

deadline is rapidly approaching.

F-2

Movants seek this relief on an expedited and ex parte basis

under Local Rule 16(g), which allows a party or non-party seek-

ing to litigate issues about the filing and public availability of

discovery materials to do so by seeking an ex parte order. Movants

make this motion in order to preserve the status quo pending

this Court’s resolution of a separate motion that they are filing

today which asks the Court to direct that these discovery ma-

terials be filed with the Clerk and that the protective order be

modified to permit public access to many of these documents.

Movants will be irreparably injured absent such interim relief,

since the parties may destroy the records, thus rendering this

issue moot. By contrast, granting this motion will cause no in-

jury to the parties, since it requires only that they “do nothing”

with the documents while movants’ other motion is litigated to

conclusion. Moreover, the importance of the issues in this case

with respect to public health and safety also requires granting

the requested relief.

We note that granting this motion will allow the parties ade-

quate time to respond to movants’ other motion, which focuses

on modification of the underlying protective order. Granting

this motion will allow that issue to be litigated and decided by

this Court in an orderly way, and we submit that for this reason

also, the interim relief sought in this motion should be allowed.

Movants are making this motion on an ex parte basis, as con-

templated by Local Rule 16(g), and we note that the Supreme

Court has decided the merits of similar.non-party motions for

access to court records or proceedings, e.g., Press-Enterprise Co.

v. Superior Court, 106 S. Ct. 2735 (1986); Globe Newspaper

Co. v. Superior Court, 457 U.S. 596 (1982), as did the Second

Circuit in a recent case raising these same issues, In re “Agent

Orange” Product Liability Litigation, 821 F.2d 139, cert. denied,

108 S. Ct. (1987). Movants thus submit that intervention

is not a prerequisite here, but they would ask the Court to grant

them intervenor status if the Court should conclude otherwise,

and we note that intervention appears to have been routinely

granted in these situatiors in this circuit. E.g., Anderson v.

Cryovac, Inc., 805 F.2d 1 (ist Cir. 1986); In re Globe Newspaper

F-3

Co., 729 F.2d 47, 50 (Ist Cir. 1984); In re San Juan Star Co.,

662 F.2d 108, 113 (Ist Cir. 1981). Movants appeared as amici

curiae in the court of appeals, and their interest is set forth in

their motion to appear there, a copy of which is attached. That

they meet the other requirements for intervention will be

demonstrated in the memoranda they are filing today.

Accordingly, for these reasons and those set forth in the ac-

companying memorandum, movants respectfully ask the Court

to preserve the status quo by ordering the parties to maintain

intact and not to destroy any discovery materials while this issue

is being litigated. For the convenience of the Court, a proposed

form of order is attached.

Respectfully submitted,

/s/ Carolyn Grace

Carolyn Grace

Shapiro & Grace

79 Milk Street

Boston, Mass. 02109

(617) 451-2155

/s/ Cornish F. Hitchcock

Cornish F. Hitchcock

Alan B. Morrison

Public Citizen Litigation Group

2000 P Street, N.W., Suite 700

Washington, D.C. 20036

(202) 785-3704

Attorneys for Public Citizen et al.

December 1987

MOTION ALLOWED.

/s/ A. David Mazzone

US.D.J.

12/28/87

G-1

Handwritten Order of the District Court accompanying

Defendants’ Motion for Entry of Judgment,

dated October 6, 1987

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

— V. am»

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

MOTION AND MEMORANDA FOR ENTRY OF

JUDGMENT IN FAVOR OF LIGGETT GROUP INC.

AND LIGGETT & MYERS TOBACCO CO., INC.

Defendants Liggett Group Inc. and Liggett & Myers Tobacco

Co., Inc. (“Liggett”), pursuant to the Mandate of the Court of

Appeals for the First Circuit, move for an order dismissing the

Complaint of Plaintiffs Ann Palmer, individually and as admi-

nistratrix of the Estate of Joseph C. Palmer, and Daphne S. Palmer

(“the Palmers”) and entering a judgment in Liggett’s favor.

On August 25, 1987, the Court of Appeals for the First Cir-

cuit reversed this Court’s prior ruling concerning the preemp-

tive effect of the Federal Cigarette Labeling and Advertising

Act, 15 U.S.C. §§1331-1341. The First Circuit stated:

This interlocutory appeal presents one highly disputed

issue: whether the Federal Cigarette Labeling and

Advertising Act, 15 U.S.C. §1331 et seq. (the Act),

preempts the Palmers’ smoking and health related

claims that challenge either the adequacy of the

G-2

eat

federal warning on cigarette packages or the propriety

of Liggett’s advertising and promotion of cigarettes. |

In deference to the congressional declaration that (i)

cigarettes be labeled uniformly and (ii) a balance be |

struck between the priority given to tobacco commerce

and to our national health policy, we hold that the

Act does preempt the Palmers’ state law claims, and

reverse the decision of the District Court.

The District Court, the defendants and the plaintiffs

agree that the issue of the Act’s preemptive force con-

trols the disposition of virtually the entire case. If the

Labeling Act is found to preempt state law actions,

either expressly or impliedly, the Palmers lose. If Con-

gress did not intend for the Act to be so preemptive,

Liggett loses the appeal.

Palmer v. Liggett Group Inc., Docket No. 86-1525 (Ist Cir.

August 25, 1987) Slip op., at 2, 5.

Each of the Palmers’ claims challenges either the adequacy

of the federally mandated warning or the propriety of Liggett's

promotion of cigarettes and is therefore preempted. Liggett

therefore requests an order which dismisses the Palmers’ com-

plaint and the entry of judgment in Liggett’s favor.

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., IN 7

By their attorneys,

/s/Joseph J. Leghorn

Samuel Adams

Joseph J. Leghorn

Deborah K. Blum

WARNER & STACKPOLE

28 State Street

Boston, MA 02109

(617) 725-1400

MOTION ALLOWED.

/s/ A. David Mazzone

US.D.J.

10/6/87

H-1

Handwritten Order of the District Court accompanying

Plaintiffs’ Motion for Reconsideration,

dated August 12, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Paimer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

—_—V—

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

PLAINTIFF'S MOTION FOR RECONSIDERATION

OF THIS COURT'S DENIAL OF PLAINTIFF'S

MOTION FOR CLARIFICATION OF THE

PROTECTIVE ORDER ISSUED FEBRUARY 25, 1985

PLEASE TAKE NOTICE that the Plaintiffs hereby move this

Honorable Court that it reconsider its order denying the Plain-

tiffs Motion for Clarification, or in the Alternative Modifica-

tion of the Protective Order Issued February 25, 1985. The Plain-

tiffs respectfully request that this Court modify the protective

order entered in this case by striking paragraph 2 of said order

and limiting the application of the order to those documents

that are prospectively designated confidential by the Defendants.

AS GROUNDS IN SUPPORT THEREOF, the Plaintiffs state

that at the time this matter was submitted to this Court, the

Plaintiffs were unaware that a protective order similar to the

one submitted by the Defendants in this case and which the

Defendants had submitted to the District Court for the District

of New Jersey in Rose D. Cipollone, et. al. v. Liggett Group,

et. al., No. 83-2864 was under consideration in that Court. In

H-2

an opinion and order dated July 17, 1985 (Exhibit “A” & “B”),

District Judge Sarokin ruled that so much of the New Jersey

Order prohibiting the public availability of non-confidential

materials was both overly broad and inconsistent with the First

Amendment to the Constitution of the United States.

1 ee eR nll

The Plaintiffs submit that this Court may desire to reconsider

its ruling to the extent this Court relied upon the Defendants’

representation in its submissions that two other Courts “ . . [had]

also issued essentially identical orders in cases in which claims

are made against companies in the cigarette industry.” (Defend-

ants’ Motion 47). While the Defendants included in their cita-

tion to the Cipollone case the fact that an appeal to District

Judge Sarokin was pending, they did not indicate that an opin-

ion was imminent. Had the Plaintiffs been aware that an opin-

ion on this very issue was about to be released, they would have

requested that this Court defer it’s [sic] ruling until the opinion

was released.*

The Plaintiffs recognize that the order of the New Jersey

Federal Court is not controlling here. However, to the extent

that this Court gave any weight to the fact that other courts

had ruled in Defendants’ favor, such deference is no longer ap-

propriate. Moreover, in view of the fact that the non-confidential

documents at issue here are now available to the public and will

be disseminated to the media, there is not rational justification

for the continued protection of this material by this Court.

* As it were [sic], this Court entered its ruling on July 16, 1985 and Judge

Sarokin released his ruling on July 17, 1985.

_ i

H-3

Accordingly, Plaintiffs respectfully request that this Court

allow the Plaintiffs’ Motion for Reconsideration and enter a pro-

tective order in the forin entered in Cipollone, et. al., v. Lig-

gett Group, Inc., et. al., supra.

By their attorneys,

NIX & POTTERS

/s/Robert S. Potters

Robert S. Potters

Nix & Potters

Sixty State Street

Boston, Massachusetts 02109

(617) 227-0101

DATED: July 23, 1985

MOTION DENIED, WITHOUT PREJUDICE TO RENEW.

The Sarokin opinion [sic] is now under appeal. This motion

should be renewed following a ruling by the Third Circuit Court

of Appeals.

/s/ A. David Mazzone

U.S.D.]J.

8/12/85

———e

I-]

Handwritten Order of the District Court

accompanying Proposed Intervenor’s Motion for

Reconsideration, dated August 12, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

—YvV, am»

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

(Oral Argument Requested)

MOTION FOR RECONSIDERATION OF PROPOSED

INTERVENOR,_THE WALL STREET JOURNAL

The Wall Street Journal, by its publisher, Dow Jones & Com-

pany, Inc. (hereinafter “The Wall Street Journal”) respectfully

moves for reconsideration of the Court’s Orders dated July 16

and July 19, 1985, by which the Court (1) denied The Wall Street

Journal’s Motion For Leave To Intervene On Limited Issue Of

Plaintiffs’ Motion for Clarification Or Modification Of Protec-

tive Order; (2) denied Plaintiffs’ Motion For Clarification Or

Modification Of Protective Order; and (3) allowed Defendants’

Motion To Require Compliance With Protective Order. The

grounds for this motion are as follows:

ee

[-2

1. Subsequent to the Court’s action on the above-described

motions, The Wall Street Journal received notice and a copy

of the Order and accompanying Opinion of the Honorable H.

Lee Sarokin, United States District Judge for the District of New

Jersey, filed on July 17, 1985, in the matter of Cipollone, et al.,

v. Liggett Group Inc., et al.., Civ. No. 83-2864. (Copies of Order

and Opinion attached hereto.)

Judge Sarokin’s Order and 29-page Opinion are submitted

not only because they represent the most thorough analysis to

date of the precise issues raised by the motions for which recon-

sideration is sought, but also because defendants have cited the

now-vacated New Jersey protective order in support of the pro-

tective order at issue here. Defendants’ Memorandum of Law

In Support of Their Motion to Require Compliance with Pro-

tective Order, footnote at pp. 3-4; Appendix To Defendants’ Mo-

tion To Require Compliance With Protective order, Ex. H.

In his Opinion, Judge Sarokin analyzed the impact of the

Supreme Court's decision in Seattle Times Co. v. Rhinehart,

104 S. Ct. 2199 (1984) on a protective order for all purposes iden-

tical to the one entered at defendants’ behest in this action. Judge

Sarokin concluded that:

In Seattle Times, the Court held the first amendment

clearly to be implicated, in light of the great degree

of public interest in plaintiff Rhinehart, the leader

of a religious group known as the Aquarian Founda-

ae tion. Much greater is the public interest in this case,

involving claims of liability against cigarette com-

panies for failure to warn and other theories.

Sarokin Opinion at 14. Judge Sarokin observed that the Supreme

Court itself has cited its decision in Seattle Times for the pro-

position that restrictions on such protected speech must “be no

greater than necessary to protect the public interest.” Jd. at 17

(citing Wayte v. United States, 105 S. Ct. 1524, 1533 (1985) ).

Judge Sarokin reviewed the protective order entered by the

magistrate from the standpoint that “defendants must bear the

burden of demonstrating the necessity for each provision of such

I-3

order.” Sarokin Opinion at 20. As is true here, the reasons of-

fered by the defendants in support of the New Jersey protective

order were “quite conclusory” — that the protective order would

streamline the discovery process, and that the information

discovered might otherwise be used for some purpose not limited

to the trial of the case at bar. Id. at 21. Accordingly, Judge

Sarokin held that paragraph 2 of the New Jersey protective order,

which was identical to paragraph 2 of the order at issue here,

oversteps the bounds permitted by Rule 26(c), and

consequently the first amendment, by limiting the

flow of information without any cause whatsoever.

The Order will accordingly be altered to cover only

confidential information.

Id. at 22. As revised by Judge Sarokin, the New Jersey protec-

tive order now contains no restrictions on disclosure of discovered

information unless it is first explicitly claimed to be, and then

agreed by the parties or found by the court to be, “confiden-

tial”. Sarokin Order, 44 2, 3.

Judge Sarokin further emphasized that the defendants would

continue to bear the burden of showing “good cause” to restrict

disclosure of information produced in discovery. Sarokin Opinion

at 28.

To conclude otherwise would unduly restrict the free

flow of information mandated by the first amend-

ment. In a case such as this in which the public has

a substantial interest, the court is reluctant to inhibit

such disclosure absent a showing that there is good

cause to do so. What are the risks of smoking; what

the tobacco industry knew of those risks; and what

action it took or did not take with that knowledge are

matters of great public concern. It is difficult to en-

vision that any of those matters involve “secrets” in

the traditional sense, worthy of protection against

public scrutiny. Indeed they may be secrets in the sense

that the industry would prefer them to remain con-

fidential, but not in the sense that their concealment

I-4

from the press and public would be consistent with

the first amendment.

Litigants are entitled to prove that information

released through the compulsion of discovery pro-

ceedings should not be made public, and they are af-

forded the opportunity to do so. However, absent such

a showing, information gleaned through discovery

should be made available, particularly when the sub-

ject matter pertains to issues which affect the health

and well-being of millions of persons.

Id. at 28-29. In short, Judge Sarokin’s Opinion recognized that

the public’s legitimate and immediate interest in receiving in-

formation that may affect its health and safety is protected by

Rule 26(c) and the first amendment, and is not limited to that

narrow subset of information that may eventually appear on

the “public record” of a trial, assuming that a trial occurs.

2. In addition to Judge Sarokin’s Opinion, The Wall Street

Journal incorporates in this motion the analysis and legal

authority set out in its memorandum of law filed in this action

on July 16, 1985.

As discussed in that memorandum, The Wall Street Journal

has standing to challenge portions of the protective order that,

as interpreted by defendants, unduly restrict the free flow of

information on a matter of consummate public interest. The

earlier memorandum also argued that, in view of the fact that

defendants selected the vague language of paragraph 2, as well

as the remainder of the protective order, a fair construction of

the order would limit its restrictions on disclosure to informa-

tion designated “confidential.” Finally, as discussed in the earlier

memorandum, defendants’ unsupported and conclusory declara-

tion that dissemination of non“confidential’” documents

produced by a non-party might embarrass them is of no weight

whatsoever in determining whether defendants have shown

“good cause” for restricting voluntary disclosure. There is simply

no record in this case, despite defendants’ ample opportunity

to attempt to create one, on which “good cause” for the blanket

I-5

restrictions said by the defendants to reside in paragraph 2 can

be found.

For all the foregoing reasons, this Court should grant plain-

tiffs’ and The Wall Street Journal’s motions for reconsideration,

deny the defendants’ previous motion and allow the previous

motions of plaintiffs and The Wall Street Journal. The Wall

Street Journal respectfully requests oral argument on its mo-

tion, and estimates that 45 minutes will be sufficient time for

all parties to be heard.

By its attorneys,

/s/Bancroft Littlefield, Jr.

Bancroft Littlefield, Jr.

Foley, Hoag & Eliot

One Post Office Square

Boston, Massachusetts 02109

(617) 482-1390

Of Counsel:

Robert D. Sack -

Robert H. Hammel

Patterson, Belknap, Webb & Tyler

30 Rockefeller Plaza

New York, New York 10112

(212) 541-4000

Dated: July 23, 1985

MOTION DENIED, WITHOUT PREJUDICE TO RENEW.

This motion should be renewed following a ruling by the Third

Circuit Court of Appeals.

/s/ A. David Mazzone

US.D.J.

8/12/85

J-1

Handwritten Order of the District Court

accompanying The Wall Street Journal's Motion

for Leave to Intervene, dated July 19, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

a= . —

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CoO., INC.,

Defendants.

Civil Action No. 83-2445-MA

MOTION FOR LEAVE TO INTERVENE ON LIMITED

ISSUE OF PLAINTIFFS’ MOTION FOR CLARIFICA-

~ TION OR MODIFICATION OF PROTECTIVE ORDER

The Wall Street Journal seeks access to certain discovery

material produced by Arthur D. Little Company (a non-party)

in this tort action against a cigarette manufacturer.

Accordingly, The Wall Street Journal, by its publisher, Dow

Jones & Company, Inc. (hereinafter The Wall Street Journal)

moves, pursuant to Fed. R. Civ. P. 24(a), to intervene and be heard

in the above action on the limited issue of Plaintiffs’ Motion for

Clarification or Modification of the Protective Order entered on

February 95, 1985. The grounds for this motion, as more fully

set out in the accompanying memorandum of law, are:

1. On June 14, 1985, plaintiffs’ counsel notified the Court that

it intended to disseminate to The Wall Street Journal certain

J-2

documents produced in discovery to plaintiffs by the Arthur D.

Little Company in light of defendants’ failure to designate such

documents as confidential pursuant to the protective order.

Defendants on June 28, 1985 moved to prevent such dissemina-

tion, asserting that the protective order prohibited such

disclosure regardless of whether the documents were designated

as confidential. Plaintiffs now move to clarify or modify the pro-

tective order so that they may disseminate the Arthur D. Little

documents to The Wall Street Journal, on the grounds that (a)

the order requires a party to designate a document “confiden-

tial” to obtain the restrictions on disclosure provided in the order,

and defendants have not so designated the Arthur D. Little

documents, and (b) if the order were to be read as imposing

disclosure restrictions on all information produced or exchanged

in the case regardless of whether good cause for such restric-

tion were shown, the order would in this respect be contrary

to law and should therefore be modified.

2. The Wall Street Journal has standing to be heard by the

Court and to intervene on the limited issue of the validity of

a Court order which under defendants’ reading would have the

effect of prohibiting plaintiffs from disclosing to The Wall Street

Journal, as they have said they wish to do, documents which

The Wall Street Journal seeks to review in a matter of great

public interest.

3. The Wall Street Journal meets the requirements for in-

tervention as of right of Rule 24(a)(2). The Wall Street Journal

claims an interest relating to the transaction which is the sub-

ject of this action, and is so situated that the disposition of the

action may as a practical matter impair or impede its ability

to protect that interest. The interest of The Wall Street Journal

is not adequately represented by the existing parties to this

action.

The Wall Street Journal respectfully requests that the Court

grant brief oral argument on the motion for intervention and

for clarification and modification. The Wall Street Journal

believes it will take no more than 45 minutes for all parties to

the motion to be heard. The Wall Street Journal requests oral

J-3

argument because of the important issues at stake in the mo-

tion and because, if all parties are heard together, it may be possi-

ble to expedite a resolution.

By its attorneys,

s/Bancroft Littlefield, Jr.

Bancroft Littlefield, Jr.

Foley, Hoag & Eliot

One Post Office Square

Boston, Massachusetts 02109

(617) 482-1390

Of Counsel,

Robert D. Sack

Robert H. Hammel

Patterson, Belknap, Webb & Tyler

30 Rockefeller Plaza

New York, N.Y. 10112

Dated: July 16, 1985

MOTION DENIED. | have ruled on this issue. The public

is entitled to the public record.

s/ A. David Mazzone

U.S.D.J.

7/19/85

K-]

Handwritten Order of the District Court accompanying

Plaintiffs’ Motion for Clarification or

Modification, dated July 16, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

— VY, —

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.

Defendants.

Civil Action No. 83-2445-MA

PLAINTIFFS’ MOTION FOR CLARIFICATION OR IN

THE ALTERNATIVE FOR MODIFICATION OF THE

PROTECTIVE ORDER ISSUED FEBRUARY 25, 1985

PLEASE TAKE NOTICE that Plaintiffs move this Honorable

Court for a clarification of this Court’s Protective Order dated

February 25, 1985 with respect to the handling and designa-

tion of documents produced in the above captioned matter. In

the alternative, pursuant to paragraph 16 of the Protective Order,

Plaintiffs seek the modification of said Order.

As grounds therefor, plaintiffs state as follows:

1. On February 25, 1985, over plaintiffs’ objections, this Court

entered the Protective Order at issue herein.

2. Paragraphs | and 2 of said Order provide as follows:

1. All counsel and their employees shall be and are

hereby prohibited and enjoined from disclosing to or

K-2

otherwise discussing with any person any confiden-

tial information (as herein defined), except as provided

hereafter.

2. All information produced or exchanged in the

course of this civil action or any appeal arising

therefrom (the “litigation”) shall be used solely for the

purpose of this case.

Paragraph 3 of the Order defines Confidential Information while

paragraph 4 concerns the method for making such designations.

Paragraphs 5 through 12 of the Order further deal with the

designation, inspection and disclosure of confidential materials.

3. Since the entering of the Order the Defendants have failed

to designate a single document as confidential.

4. Counsel for Plaintiffs have received a request from the Dow

Jones & Company, Inc. requesting certain materials produced

to Plaintiffs by Arthur D. Little Company Inc., a non-party to

this action.

5. In response to that request Plaintiffs filed their Notice of

Intent to Disseminate. After being informed that the Defendants

intended to oppose that action, Plaintiffs agreed not to distribute

any material until the Defendants responded and this Court

made any necessary clarifications or modifications.

6. In response to Plaintiffs’ Notice of Intent to Disseminate

Documents, Defendants assert that paragraph 2 of the Protec-

tive Order categorically protects every document produced to

Plaintiffs.

7. The provisions of paragraph 2 should be read in conjunc-

tion with the remaining paragraphs of the order so as to pro-

tect confidential information from being used for any purpose

other that [sic] the trial of this case. To read paragraph 2 other-

wise would provide a blanket protection without regard to

whether the information “falls within the scope of confidential

information under the Federal Rules of Civil Procedure and the

precedents thereto.” (See Paragraph 3 of Protective Order)

K-3

8. This Court’s order issued pursuant to Rule 26 (c) is clear-

ly designed to protect confidential information exchanged during

the course of litigation. No broader purpose should be read in-

to the terms of the Order.

9. The expansive reading that Defendants suggest is contrary

to law and unsupported by any demonstration of “good cause.”

No factual support for Defendants’ position has been offered

or substantiated.

10. Plaintiffs are not seeking a trial by the media but are

endeavoring to respond to a request by a media publication of

the highest standards which desires to inform the public of the

information contained in Arthur D. Little’s research materials.

This is not a case where documents could be used for an alter-

native purpose, such as harassment or ridicule. The documents

are of an historical nature.

ll. Plaintiffs have not disseminated any documents and have

never intended to disregard, ignore, or otherwise act contrary

to an Order of this Court. Plaintiffs filed their Notice of Intent

to Disseminate in the good faith belief that the Order was limited

in its application to confidential documents and that the use

of these confidential documents was restricted to this case against

the Defendants.

12. Clarification of this Court’s order is in the interest of all

parties to this action

13. In further support of this Motion for Clarification Plain-

tiffs intend to rely upon the Memorandum of Law they expect

counsel for Dow Jones & Company, Inc. to file with this Cor et.

WHEREFORE, Plaintiffs seek clarification or in the alter-

native modification of the February 25, 1985 Protective Order.

K-4

By their attorneys,

Nix & Potters

/s/Daniel A. Shapiro

Robert S. Potters

Daniel A. Shapiro

60 State Street

Boston, Massachusetts

(617) 227-0101

July 12, 1985

REQUEST FOR ORAL ARGUMENT

The Plaintiffs request oral argument on their Motion for

Clarification or in the Alternative for Modification, pursuant

to Local Rule 12 (c), and request thirty minutes for both parties.

MOTION DENIED.

/s/ A. David Mazzone

U.S.D.J.

7/16/85

L-l

Handwritten Order of the District Court

accompanying Defendants’ Motion to Require Compliance

with Protective Order, dated July 16, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

—V—

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

MOTION TO REQUIRE COMPLIANCE

WITH PROTECTIVE ORDER

Pursuant to Rules 26(c) and 37 of the Federal Rules of Civil

Procedure, defendants Liggett Group Inc. and Liggett & Myers

Tobacco Co., Inc. respectfully move this Honorable Court for

an order:

(a) Directing plaintiffs and their attorneys to comply with

the terms of paragraph 2 of a Protective Order of this Court

dated February 25, 1985 (the “Protective Order”) and not to

disseminate to Dow Jones & Company, Inc., publishers of The

Wall Street Journal (“Dow Jones”) any of the documents pro-

duced to plaintiffs by Arthur D. Little, Inc. and not used at trial;

and

L-2

S

-_—_—_ —

(b) Finding that any dissemination or distribution to Dow

Jones of any or all of the documents produced in this action by

Arthur D. Little Inc. shall be a violation of the terms of

Paragraph 2 of the Protective Order, and shall be an act in con-

tempt of court subjecting the violator to punishment.

The facts supporting and grounds for this Motion are as

follows:

1. Paragraph 2 of the Protective Order, a copy of which is at-

tached as Exhibit A in the Appendix to Defendants’ Motion to

Require Compliance With Protective Order (the “Appendix”),

provides as follows:

All information produced or exchanged in the course

of this civil action or any appeal arising therefrom (the

“litigation”) shall be used solely for the purpose of this

case.

Paragraph 16 of the Protective Order further provides as follows:

Any party may apply to this Court at any time, upon

proper notice, for a modification of this Protective

Order with respect to the handling or description of

any document or for any other purpose.

2. Plaintiffs have never sought to utilize the provisions of

Paragraph 16 by moving to modify or vacate any of the terms

of the Protective Order, nor have they moved to reargue or ap-

peal the Order.

3. Plaintiffs have twice sought and obtained protective orders

whose provisions are virtually identical to those of the Protective

Order and limiting the extrajudicial use of information obtained

through discovery. See Plaintiffs’ Motion for Protective Order.

dated January 7, 1985, allowed by Order of the Court dated

January 25, 1985 (Appendix Exhibit B); Stipulation and Protec-

tive Order dated January 17, 1984 (Appendix Exhibit C). The

grounds used by plaintiffs to support their protective order was

their counsel's claim that public disclosure of private material

would cause “embarrassment and harrassment” [sic]. (Exhibit B

q€ 3-4),

L-3

4. By letter dated June 7, 1985 (Appendix Exhibit D), Foley,

Hoag & Eliot, attorneys for Dow Jones, advised the Court that

their client wished to obtain access to certain documents pro-

duced in discovery to plaintiffs. Implicit in the June 7, 1985 letter

is Dow Jones’ recognition that the Protective Order prohibits

plaintiffs from unilaterally disseminating to Dow Jones any

document produced in discovery and not used at trial or made

part of the public record. By letter dated June 13, 1985 (Ap-

pendix Exhibit E), defendants’ counsel advised Dow Jones that

it had advised the Court that it would oppose such a motion.

5. Immediately thereafter, and in disregard of Paragraph 2

of the Protective Order, plaintiffs’ counsel, in a document en-

titled “Notice of Intent to Disseminate Documents” (the “Notice

of Intent”) (Appendix Exhibit F), announced their intention to

turn over to Dow Jones documents produced in this action by

Arthur D. Little Inc. Plaintiffs’ counsel further state in the Notice

of Intent that only “intervening action by this Court” will pre-

vent them from disseminating documents to the [sic] Dow Jones.

6. Dissemination to Dow Jones of documents received by

plaintiffs in discovery is not the use of documents “solely for

the purpose of this case” and thus violates Paragraph 2 of the

Protective Order.

7. As demonstrated in the accompanying memorandum of

law, it was within the discretion of the Court to enter the Pro-

tective Order restricting the use of discovered information to

“solely for the purpose of this case.” Not only has this Court

ordered such restrictions on two other occasions at plaintiffs’

request, other courts have also issued essentially identical orders

in cases in which claims are made against companies in the

cigarette industry. See Barnes v. R.J. Reynolds, Civ. Action No.

84-56 (D.N.J. Order docketed November 11, 1984); Cipollone

v. Liggett Group, Inc., Civ. Action No. 83-2864 (D.N.J. Order

docketed April 1, 1985, Appeal to the District Court filed) (Ap-

pendix Exhibits G & H).

8. Plaintiffs’ use of information obtained through the discovery

process for purposes wholly unrelated to the prosecution of this

L-4

case would be an abuse of this Court’s processes. The law clearly

empowers this Court to prevent plaintiffs’ counsel from conduc-

ting a media trial by feeding to the press selective material, ob-

tained by plaintiffs in discovery ostensibly for the purpose of

prosecuting their case. Further, it would also be inherently un-

fair to permit plaintiffs to obtain a protective order based sole-

ly on aclaim that public disclosure of their records “may cause

undue embarrassment and harrassment” [sic] and deny that

same relief to defendants when they seek such protection based,

in part, on the same grounds.

Accordingly, it is respectfully submitted that the instant mo-

tion to enforce the terms of the Protective Order be granted.

Dated: June 28, 1985

Webster & Sheffield

By: /s/ James V. Kearney

James V. Kearney

Co-Counsel for Defendants

1 Rockefeller Plaza

New York, New York 10020

(212) 957-9800

MOTION ALLOWED. The dissemination of this material

will not aid in the fair trial of this case. The trial is public and

the Wall Street Journal is, of course, able to attend the trial.

/s/ A. David Mazzone

U.S.D.]J.

July 16, 1985

M-1

Order of the District Court,

dated February 25, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

—V,.—

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

PROTECTIVE ORDER

Pursuant to Rule 26(c) of the Federal Rules of Civil Procedure,

IT IS HEREBY ORDERED AND DECREED that:

1. All counsel and their employees shall be and are hereby

prohibited and enjoined from disclosing to or otherwise discuss-

ing with any person any confidential information (as herein

defined), except as provided hereafter.

2. All information produced or exchanged in the course of

this civil action or any appeal arising therefrom (the “litigation”)

shall be used solely for the purpose of this case.

M-2

3. “Confidential information” as used herein means any in-

formation which is designated as “confidential.” whether it be

a document, information contained in a document, informa-

tion revealed during a deposition or in any interrogatory answer

or otherwise disclosed in discovery. Information shall be

designated as confidential only upon the good-faith belief that

the information falls within the scope of confidential informa-

tion under the Federal Rules of Civil Procedure and the

precedents thereto.

4. Documents containing confidential information shall be

designated as confidential by placing the word “CONFIDEN-

TIAL’ or the following label (or a substantial equivalent) on

the original of the document:

“CONFIDENTIAL’

“PAGES/PARAGRAPHS/LINES ___ THROUGH

—_ OF THIS DOCUMENT ARE SUBJECT TO A

COURT ORDER AND THIS DOCUMENT AND

THEIR CONTENTS SHALL NOT BE USED,

SHOWN OR DISTRIBUTED EXCEPT AS PROVID-

ED IN THE COURT’S ORDER.”

In lieu of placing this label on the original of the documents,

the party may place the label on the copies of the documents

that are produced.

5. Confidential information which is disclosed at a deposi-

tion must be designated as confidential by indicating on the

record at the deposition, or in writing to all counsel within ten

days following receipt of the deposition transcript by counsel

so designating, that the testimony is confidential and subject

to the provisions of this Court Order with regard to confiden-

tiality.

6. Confidential information may be inspected only by the

following persons:

M-3

(a) Counsel of record for the plaintiff and defendants

in this litigation, any lawyers specifically em-

ployed by them in connection with the litigation

and any employee of such counsel assisting with

this litigation;

(b) Experts retained by or on behalf of any party to

provide assistance or testimony in connection with

this litigation.

7. Each person, other than those described in §6(a), to whom

designated confidential information or documents are to be

disclosed shall, prior to such disclosure, agree in writing under

oath or attestation to the following, a copy of which shall forth-

with be furnished to all counsel:

I hereby attest to my understanding that information

or documents designated confidential will be provided

to me pursuant to the terms and conditions and

restrictions of the Protective Order of ;

1985, in Palmer v. Liggett Group, Inc., et al., the

United States District Court for the District of

Massachusetts; that I have been given a copy of and

have read the Protective Order and have had its mean-

ing and effect explained to me by the attorneys pro-

viding me with such information or documents, and

that I hereby agree to be bound by it and its terms.

I further agree that I shall not disclose to others, ex-

cept in accordance with the Protective Order, such

information or documents, and that such information

or documents shall be used only for the purposes of

the legal proceeding in which they were produced.

I further agree and attest to my understanding that

my obligation to honor the confidentiality of such in-

formation or documents will continue even after the

termination of that legal proceeding. I further agree

and attest to my understanding that, in the event that

I fail to abide by the terms of the Protective Order,

I may be subject to sanctions, including sanctions by

way of contempt of court, imposed by the Court, for

such a failure.

M-4

Copies of this attestation shall be served upon all counsel prior

to such disclosure; in lieu of such service, copies of the attesta-

tion signed by medical experts may be filed under seal with the

Court, for the period prior to the identification of such experts

in pre-trial discovery.

8. No summary or copy of any designated confidential infor-

mation or document shall be made by any person, other than

at the express direction of the attorney to whom disclosure was

first made. Any such summary or copy shall be subject to the

terms of this Protective Order to the same extent as the infor-

mation or document from which such summary or copy is made.

9. Inadvertent disclosure of any document or other informa-

tion during discovery in this action shall be without prejudice

to any claims that such material is confidential, privileged or

otherwise protected from discovery within the meaning of

Federal Rule of Civil Procedure 26(b)(3), and no party shall be

held to have waived any rights by such inadvertent disclosure.

Any document or information so produced and subject to a

subsequent claim of privilege, work product or other protec-

tion, shall be returned immediately to the appropriate party

and such document or information shall not be introduced in-

to evidence in this or any other proceeding by any person without

(i) the consent of said party or (ii) by order of the Court, nor

will such document or information be subject to production

(other than in camera) in any proceeding by virtue of the fact

that it was inadvertently produced in this proceeding.

10. Prior to the disclosure of any confidential information to

any person, other than outside counsel and their employees or

medical experts, the party seeking disclosure shall advise counsel

and the Court, in writing, of the name, address and occupa-

tion of the person to whom counsel proposes to disclose, for the

purposes of this litigation, said confidential information. Within

twenty (20) days after such advice, counsei to whom notice is

given may give written permission for such disclosure or may

give written notice to adverse counsel of an application to this

Court for an Order prohibiting the proposed disclosure. No such

M-5

disclosure shall take place until the Court has acted upon such

application. In the absence of notice of such application, the

party seeking disclosure may proceed, after expiration of said

twenty (20) days with the disclosure proposed.

ll. The Clerk of the Court is directed to maintain under seal

all documents and transcripts of deposition testimony filed in

this litigation which have been designated, in whole or in part,

as “confidential” pursuant to the terms of this Order.

12. In the event that any information or documents subject

to the confidentiality restrictions of this Protective Order is used

in pre-trial depositions, briefs, or other documents filed with

the Court, or is referred to in any hearing before the Court, such

use or reference shall be made under seal and bear the legend,

“THIS DOCUMENT CONTAINS CONFIDENTIAL

MATERIAL COVERED BY A PROTECTIVE

ORDER OF THE COURT AND IS SUBMITTED

UNDER SEAL PURSUANT TO THAT PROTEC-

TIVE ORDER: THE CONTENTS OF THIS DOCU-

MENT MAY NOT BE DISCLOSED WITHOUT EX-

PRESS ORDER OF THE COURT.”

and/or be reviewed by the Court in camera with the public

excluded.

13. Within forty-five days after the final adjudication or set-

tlement of all claims in this case, counsel for the parties either

shall return all documents produced, if so requested by the pro-

ducing party, or shall destroy all such documents. All copies of

documents, and all information and notes derived from them,

also shall be destroyed. Compliance with this provision shall be

certified to by all counsel for the obtaining party or parties.

14. Nothing herein shall be deemed to restrict in any manner

the use by any party of its own documents or materials.

15. Nothing herein shall affect the right of any party to seek

additional protection against the disclosure of any documents

or materials.

ee

M-6

16. Any party may apply to this Court at any time, upon pro-

per notice, for a modification of this Protective Order with

respect to the handling or designation of any document or for

any other purpose.

17. This Order shall be binding upon any future party to this

litigation.

/s/ A. David Mazzone

A. David Mazzone

United States District Judge

February 25, 1985

N-1

Handwritten Order of the District Court

accompanying Defendants’ Request for a

Protective Order, dated February 25, 1985

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER.

Plaintiffs,

=— Vv, —

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CoO., INC.,

Defendants.

Civil Action No. 83-2445-MA

DEFENDANTS’ REQUEST FOR

A PROTECTIVE ORDER

Defendants Liggett Group, Inc. and Liggett & Myers Tobacco

Co., Inc. (“Liggett”), pursuant to Rule 26(c) of the Federal Rules

of Civil Procedure, request this Court enter the attached Pro-

tective Order. The Order provides, in part, that information pro-

duced or exchanged in the course of this action, including any

appeal, shall be used solely for the purposes of this action.

In support of their request, Liggett states that because the

plaintiffs’ discovery demands, including requests for the pro-

duction and inspection of documents, answers to interrogatories,

and deposition testimony, require the disclosure of massive

amounts of documents and information it would be physically

impossible for defendants to designate individually each docu-

ment containing confidential or secret information. In an ef-

fort to comply with plaintiffs’ discovery needs while maintain-

ing defendants’ right to protection of its confidential informa-

tion, defendants seek the protection of an order of this Court.

N-2

Dated: February 5, 1985

LIGGETT GROUP, INC. and

LIGGETT & MYERS TOBACCO CO., INC.

By its attorneys,

/s/ Francis H. Fox

Francis H. Fox

Robert E. McDonnell

Carol J. Paquin

BINGHAM, DANA & GOULD

100 Federal Street

Boston, MA 02110

(617) 357-9300

/s) Donald J. Cohn

Donald J. Cohn

Francis K. Decker, Jr.

James V. Kearney

WEBSTER & SHEFFIELD

One Rockefeller Plaza

New York, NY 10020

(212) 957-9800

REQUEST ALLOWED.

/s/ A. David Mazzone

US.D.J.

2/25/85

O-1

Transcript of Hearing before the District Court,

January 28, 1988

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

ANN M. PALMER, as Administratrix of the Estate of

Joseph C. Palmer, and ANN M. PALMER

and DAPHNE S. PALMER,

Plaintiffs,

on Vv, —

LIGGETT GROUP INC. and

LIGGETT & MYERS TOBACCO CO., INC.,

Defendants.

Civil Action No. 83-2445-MA

Hearing before MAZZONE, District Judge

Courtroom No. 5 U.S.D.C. Boston, MA

11:30 a.m., Thursday, January 28, 1988

APPEARANCES:

Nix & Potters

(By Robert S. Potters, Esquire)

184 High Street

Boston, MA, 02110,

Representing the Plaintiff.

Warner & Stackpole

(By Attorneys Joseph J. Leghorn and Samuel Adams)

28 State Street

Boston, MA, 02109

Representing the Defendant.

Public Citizen Litigation Group

(By Cornish F. Hitchcock, Esquire)

2000 P Street, N.W., Suite 700

Washington, D.C. 20036

Representing the Movants

O-2

REPORTED BY:

James P. Gibbons

Temporary Official Court Reporter

2004, U.S.P.O. & Courthouse

Boston, MA, 02109, 426-8716

Mechanical Steno - Transcript by Computer

PROCEEDINGS

THE CLERK: Civil Action No. 83-445, Ann Palmer versus

Liggett Group, et al.

THE COURT: Good morning, counsel.

All right, I thought it would be a good idea if we had a hear-

ing on this matter, and you could answer some questions for

me that might help.

I’ve read your memoranda and the reply memoranda as well.

Let me just identify — Mr. Potters, I know.

MR. HITCHCOCK: Your Honor, I’m Cornish F. Hitchcock.

THE COURT: You have not appeared previously, as I

remember, Mr. Hitchcock?

MR. HITCHCOCK: That is correct, your Honor. We filed

a motion. We filed our initial papers at the end of December

seeking relief to appear and appear pro hac for Ms. Grace who

could not be here this morning.

THE COURT: Of course Mr. Leghorn and Mr. Adams.

Now, Mr. Hitchcock, you want the discovery material filed

in this case available to you?

MR. HITCHCOCK: That is correct, your Honor.

THE COURT: And you want it for public information

purposes?

MR. HITCHCOCK: The relief — yes, your Honor.

The relief we're seeking and what we ask the Court to decide

today is whether the information should be filed; and, second-

ly, whether the parties desiring secrecy should be required to

O-3

make a showing that certain materials that are confidential or

entitled to be withheld from the public should be withheld.

As for those materials which do not qualify under Rule 26

for secrecy, we are asking the Court to lift the seal and allow

those to be public. But for today’s purpose we are asking for

the filing and allow the parties to make the records for show-

ing, as called for in the proposed order submitted to your Honor.

THE COURT: Now, one of the responses is that it’s not time-

ly. The case was closed. You did not seek certiorari. The case

is Over.

So my first question, and maybe Mr. Potters can answer.

MR. POTTERS: The case is over, your Honor. As the Court

perhaps remembers, shortly after the decision of the First Cir-

cuit, a motion was filed by the defendants in this court to dismiss

the action. That motion was allowed by your Honor.

THE COURT: As to all claims?

MR. POTTERS: As to all claims.

We neither sought certiorari on the First Circuit’s opinion,

nor did we appeal this Court’s order dismissing the action.

THE COURT: You have not?

MR. POTTERS: We have not, and in fact we informed the

defendants that we do not intend to.

THE COURT: So the case as far as you're concerned — there

is no State Court claim?

MR. POTTERS: All claims have been adjudicated.

THE COURT: Did we close it, Miss Costello?

THE CLERK: Yes, we did.

THE COURT: It’s a statistical closing.

O-4

_ THE CLERK: It’s closed out.

THE COURT: What about that, Mr. Hitchcock?

MR. HITCHCOCK: My —

THE COURT: What jurisdiction do I now have? Should this

~ be a matter if at all to be heard further, to be heard by the

miscellaneous business docket judge; or why is this addressed

to me since I have no further jurisdiction?

MR. HITCHCOCK: Our answer to that, your Honor, we go

into this is in some detail in our reply memorandun,, is two-fold.

First of all, the timeliness considerations that normally ap-

ply with parties coming into a case have to be assessed in light

of what the parties are asking for.

The cases that the defendant cites deal with situations when

a party tries to intervene in a case where there is a consent order,

where the District Court is trying to fashion a remedy and the

party coming in after the fact might raise questions that deal

with the relief.

Here, and this is addressed in Judge Mansfield’s comments

and reported in our opening paper, the sort of relief we're ask-

ing is the sort of relief with which usual timeliness concerns do

not apply. Judge Mansfield indicated in a motion, If records

are not filed and a party later comes in and says they ought to

be filed, that the party should be able to do so, and I think the

local rule of this Court allows ‘that as well.

Secondly, even though the order of judgment was entered in

October, the time for filing certiorari did not end until — run

out until the end of November; and even if the Court did enter

the judgment, it was at best provisional.

The other factor is that as we read the papers, this Court in-

dicated it was unwilling to examine these issues until after the

Third Circuit had ruled in the Cipollone case, pending in the

District of New Jersey.

0-5

The Third Circuit ruled in that case in the summer of 1987.

The tobacco companies, the defendant in this case, took a peti-

tion for certiorari to the Supreme Court and that was not denied

until December 7 of last year, at which point we began prepar-

ing the papers.

THE COURT: What right did you obtain as as a result of

that ruling?

MR. HITCHCOCK: Excuse me, your Honor?

THE COURT: What papers have you obtained? What infor-

mation have you obtained?

MR. HITCHCOCK: I’m not exactly aware, your Honor. The

case is still progressing towards trial. I believe it’s in trial now,

and the parties have focused on this and haven't had a chance

to talk to them about other matters there.

But there are several aspects I think are important in this case

and several changes which Judge S

This text is long and has been trimmed here. Open the source document for the complete record.