Trump Organization Fights Media Effort to Unseal Settlement

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By Elliott T. Dube

The Trump Organization is fighting to keep sealed a 1998 legal settlement stemming from the demolition of the building that made way for Trump Tower in Manhattan ( Hardy v. Kaszycki & Sons Contractors Inc. , 2d Cir., No. 16-03273, brief filed 2/10/17 ).

A federal district court had sealed the settlement record for a lawsuit over allegedly unpaid pension contributions for workers at the site. That court in August 2016 refused a request from Time Inc. and the Reporters Committee for Freedom of the Press to access the record, finding that there was “good cause” to seal it. The groups appealed to the U.S. Court of Appeals for the Second Circuit.

The Trump Organization filed a brief Feb. 10 arguing that there is no right of public access to the record under the First Amendment or common law. The district court was right to find that “good cause” existed when it sealed the record, it said.

“For the court to now unseal the settlement in response to the media’s endless assault to uncover information concerning each and every one of President Trump’s prior business dealings, would, in our view, be both unfair and unprecedented,” Trump Organization attorney Matthew Maron told Bloomberg BNA in a Feb. 13 statement.

But the Trump Organization’s arguments are “dead wrong,” Arthur Bryant, chairman of Public Justice, a public interest law firm, told Bloomberg BNA Feb. 13. He pointed to the brief’s focus on how Donald Trump wasn’t a public official at the time of the settlement. The law requires courts to determine what the opposing justifications for secrecy and public access are when access is being sought, not when a court initially entered a secrecy order, Bryant said.

District Court’s Test Under Microscope

The media groups failed to provide evidence establishing “extraordinary circumstances or a compelling need” to unseal the 1998 settlement, the district court found in August 2016.

The groups have argued on appeal that the district court was wrong to use a “good cause” standard. Bryant agreed with the groups, saying the proper test is “much higher and harder to meet” and demands “compelling reasons” for secrecy.

A presumed First Amendment right of public access to court documents doesn’t cover the 1998 settlement, the brief argued.

Settlement records haven’t historically been open to the press and general public, the brief said. Public access would undermine the confidentiality of settlement agreements, which the Second Circuit has endorsed in “virtually all cases,” it said.

The 1998 settlement also doesn’t fall under a presumed common law right of access, and it wasn’t a presumptively accessible class settlement, the Trump brief said.

But the parties’ "interest in facilitating settlement in complex cases” can’t outweigh the public’s right to know, Bryant said, quoting the district court’s August 2016 denial of the media groups’ request. “If it could, you could kiss the public’s right to know goodbye in almost every complex case,” he said.

To contact the reporter on this story: Elliott T. Dube in Washington at edube@bna.com

To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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