Summary
sealing permitted where “the nature of much of the information in question is traditionally private as it involves illness and private conduct between” dying Beatle George Harrison and his physician
Summary of this case from Lytle v. JPMorgan ChaseOpinion
04-CV-00033 (NGG).
October 4, 2004
MEMORANDUM ORDER
Gilbert Lederman brings this motion for an order finding Sonnenschein Nath Rosenthal and Matthew L. Lifflander, counsel for the plaintiffs, in contempt of court for violating the Order of Settlement and Dismissal entered in this action.
I. BACKGROUND
A. Litigation and Settlement
As has been well documented in the press, this case involved a dispute in which the estate of former Beatle George Harrison alleged that Dr. Gilbert Lederman and Staten Island University Hospital ("SIUH"), where Lederman practiced, abused Mr. Harrison's trust by leaking confidential information about his treatment and traded upon his fame to promote Lederman's cancer treatment techniques. Additionally, the plaintiffs alleged that Lederman had coerced Mr. Harrison into autographing a guitar and two cards in order to create valuable memorabilia. Shortly after the complaint was filed on January 6, 2004, the court undertook supervision of settlement negotiations in recognition of the interests of all parties in reaching a speedy resolution and avoiding unwanted publicity. On January 15, 2004, a Settlement Agreement and Consent ("Settlement Agreement") was signed by the parties. The court entered an Order of Settlement and Dismissal on February 11, 2004, dismissing the case with prejudice but retaining jurisdiction in order to enforce the terms of the Settlement Agreement.
Based on the wishes of all parties to avoid continued publicity, the Settlement Agreement was filed under seal and also required confidentiality of its terms. In addition to these measures, the Settlement Agreement contained broad provisions intended to quell publicity regarding the events underlying the litigation. Specifically, the agreement provided:
(a) Plaintiffs, Defendants, their employees, agents, representatives, attorneys, successors and assigns, and all those acting directly or indirectly in concert or participation with them, including Dr. Lederman's wife, Dr. Josiane Lederman, Olivia Harrison and Dhani Harrison (collectively, the "Consenting Persons"), are permanently enjoined from taking any public action or making any public statement: (i) that is related in any way to the treatment of George Harrison by Dr. Lederman and SIUH; (ii) that is related in any way to knowledge acquired directly or indirectly about George Harrison as a result of his treatment by Dr. Lederman and SIUH; or (iii) that implies or is calculated to cause the public to infer an association between Defendants, or any of them, and George Harrison and/or his family, including but not limited to, describing treatments and services available from the Defendants in the context of press inquiries regarding George Harrison, or the display of photographs or autographs of George Harrison or other memorabilia relating to Mr. Harrison in Dr. Lederman's and his wife's professional offices or at SIUH. . . .
The court recognizes the interests of the parties in maintaining the confidentiality of the terms of the Settlement Agreement. In order to render a meaningful decision in this motion, however, the court must quote a limited portion of the agreement. Moreover, the court notes that this paragraph relates less to the substance of the underlying settlement than it does to the manner in which the agreement will be enforced.
These provisions are the subject of this contempt motion. Specifically, Lederman contends that the attorneys for the Harrison estate have breached the Settlement Agreement by taking public actions and making public statements that link Lederman to George Harrison.
During the course of filing the complaint and the settlement negotiations, the Harrison estate was represented by lawyers from the firm of Sonnenschein Nath Rosenthal LLP ("SNR"). Included among these lawyers was Matthew L. Lifflander, who serves in an "of counsel" position for that firm. In addition to being affiliated with SNR, Lifflander also is a partner of Lifflander, Reich Smith LLP ("LRS"). SNR Memo. at 2.
B. Subsequent Events
On June 28, 2004, Lifflander and his firm LRS filed a complaint in this court against SIUH, Lederman and Philip Jay Silverman, a doctor who also practices at SIUH, for fraud, medical malpractice and violation of New York State consumer protection and public health laws. The suit was filed on behalf of Elizabeth M. Ryan, individually, and the Estate of Thomas W. Ryan, Mrs. Ryan's late husband. The complaint alleges that Mr. Ryan, who was a patient of Lederman's, "was lured into useless treatment by aggressive, false advertising by defendants Staten Island University Hospital, Gilbert Lederman M.D. and Philip Jay Silverman M.D." Ryan Compl. at ¶ 1. Further, the complaint contends that part of the reason the Ryans were induced to select SIUH and Lederman for Mr. Ryan's care was that when they visited the hospital, they viewed "several autographed photographs of George Harrison." Id. at ¶ 11. The complaint states: "The Ryans believed that since George Harrison, who presumably could afford the finest treatment in the world, came to SIUH and Lederman for his medical care, they were in the right place for treatment."Id.
Ryan v. Staten Island University Hospital, 04-CV-02666.
The Ryan complaint goes on to assert in two other places that SIUH, Lederman and Silverman used photographs of George Harrison or the fact that he was a patient of the hospital as part of their approach to inducing the Ryans to seek treatment from them. Id. at ¶¶ 81, 86. More generally, the complaint contends that Lederman's public disclosure of his treatment of George Harrison showed that he "had a history of placing his interests ahead of those of his vulnerable patients." Id. at ¶ 22.
Following the filing of the Ryan complaint, Lifflander was in contact with the press regarding his new case against Lederman. In a June 29, 2004 article in the Staten Island Advance, Lifflander is quoted as saying that the defendant doctors "are preying on people who have been told they have terminal cancer." Lisa Schneider, $31M lawsuit is filed against hospital and 2 doctors, Staten Island Advance, June 29, 2004. The article notes that Lifflander had previously represented the Harrison estate in its suit against Lederman. The article also comments: "As a result of that suit, the New York Board for Professional Conduct censured and reprimanded Dr. Lederman, Lifflander said."Id.
The following day, June 30, 2004, an article in the New York Post again quoted Lifflander regarding Silverman and Lederman: "They're ghouls. These doctors are preying on desperate people who are terminally ill. They're guilty of false advertising. They say they can cure pancreatic cancer, and that's just not true." Aly Sujo, `Ghoul' Beatle Doc Sued, N.Y. Post, June 30, 2004. The article references the suit filed by the Harrison estate against Lederman but draws no connection between that case and Lifflander.
Further, Lederman accuses Lifflander of fomenting public discussion of Lederman by releasing an administrative complaint filed with the New York State Department of Health to the Staten Island Advance. The administrative complaint was referenced in a July 9, 2004 article, which also mentioned both the Ryan lawsuit and Lederman's treatment of Harrison.
Lederman brought this contempt motion on July 23, 2004, requesting that the court (1) hold SNR and Lifflander in contempt of court, (2) make SNR and Lifflander pay Lederman's attorneys' fees on the contempt motion, (3) impose a "substantial fine" on SNR and Lederman, (4) order Lifflander to resign as an attorney in the Ryan case, and (5) order SNR, Lifflander and Lifflander's other firm, LRS, to have no pecuniary interest in the Ryan lawsuit. Pl. Mem. at 12-13.
II. DISCUSSION
A. No Breach of the Settlement Agreement Occurred
Lederman charges that Lifflander violated the confidentiality provisions of the Settlement Agreement by filing the Ryan lawsuit, which linked George Harrison to Lederman, and by making statements to the press concerning Lederman and the Harrison lawsuit. Roth Decl. at ¶¶ 3-9. SNR should also be found in contempt, Lederman argues, because Lifflander signed the complaint on behalf of SNR and he maintains ties to the firm, such as being listed as "of counsel" on its website. Id. at ¶¶ 8-9.
In filing the Ryan lawsuit against Lederman, Lifflander was acting at the behest of his client and so his actions must be judged in that light. It is well established that "[t]he relationship between an attorney and the client he or she represents in a lawsuit is one of agent and principal." Veal v. Geraci, 23 F.3d 722, 725 (2d Cir. 1994) (citations omitted);see also Restatement (Third) of the Law Governing Lawyers 2, Introductory Note (2000). As a result, the allegations contained within the Ryan complaint are largely attributable to Lifflander's client, Elizabeth Ryan. The complaint itself bears this point out. In three of the four paragraphs at issue, ¶¶ 11, 81 and 86, the mention of George Harrison is directly related to the Ryans' firsthand experience of allegedly viewing pictures of George Harrison at SIUH and being enticed to retain Lederman as a result of that fact. Only in paragraph twenty-two of the complaint, in which it is alleged that Lederman obtained "free publicity for himself and his medical practice at the expense of his famous patient," does Lifflander come close to violating the terms of the Settlement Agreement. But even in this instance, the court is satisfied that the allegation is sufficiently related to his representation of Ryan that it is not contemptuous. While certainly not essential to the Ryans' claims, and quite likely gratuitous, a diligent lawyer other than Lifflander might have been prompted to include such an accusation upon conducting further research into the relevance of the George Harrison photos.
Lederman contends in his papers that as a solution to this alleged contempt, the court should remove Lifflander from the Ryan case. This drastic solution would surely resolve the issue from Lederman's perspective, but it is both unnecessary, as no contempt has occurred, and an impossibility. The Ryan case is not assigned to me, and it would be inappropriate to intervene in this manner in proceedings before another judge.
Turning to Lifflander's interaction with the press, the court finds that, as with the Ryan complaint, Lifflander did not contravene the Settlement Agreement. Lederman cites three instances in which Lifflander is alleged to have acted in contempt through his disclosures to the media. These instances will be considered in turn.
First, on June 29, 2004, the Staten Island Advance contained statements by Lifflander about Lederman. Lifflander is quoted as saying that Lederman and his colleague Dr. Silverman "are preying on people who have been told they have terminal cancer." This statement draws no connection between Lederman and Harrison and, as a result, there is no basis for finding that it violated the agreement. The article itself mentions that Lifflander had represented the Harrison estate against Lederman, but this fact is not attributed to Lifflander, and, since it was already a matter of public record, it would be speculation to infer that Lifflander brought this point to the reporter's attention.
The following language also appeared in the June 29 article: "As a result of that suit, the New York Board for Professional Conduct censured and reprimanded Dr. Lederman, Lifflander said." This statement presents a closer call but does not constitute unambiguous proof of contempt. A finding of contempt is a "potent weapon to which courts should not resort where there is a fair ground of doubt as to the wrongfulness of the defendant's conduct." King v. Allied Vision, Ltd., 65 F.3d 1051, 1058 (2d Cir. 1995) (internal citations omitted). Therefore, to hold a party in civil contempt for failure to comply with a court order, "the proof of noncompliance must be clear and convincing." Id. While Lifflander's remarks to the reporter clearly involved either confirming or discussing the action taken against Lederman by the New York Board for Professional Conduct, without either a direct quotation of Lifflander in the article or more evidence as to the substance of his comments to the reporter, the court would be required to speculate in order to assess the extent and nature of the connection that Lifflander drew between the Harrisons and Lederman. On its face, the statement reflects poor judgment by Lifflander, but it does not amount to a clear and convincing violation of the Settlement Agreement meriting a contempt finding.
The June 30, 2004 New York Post article quotes Lifflander as calling Lederman and Silver "ghouls" and deriding their practices as "false advertising." All of Lifflander's quoted comments, however, are related directly to the Ryan lawsuit. Although the article mentions the Harrison lawsuit against Lederman, it is again unclear whether Lifflander brought this to the attention of the reporter or not. But as both sides acknowledged in their motion papers, Lederman will now inevitably be linked to the Harrison case whenever he is the subject of press coverage. The fact that it is Lifflander whose comments trigger this rehashing of the Harrison suit is of no consequence as long those comments do not breach the Settlement Agreement. This analysis applies equally to the July 9, 2004 Staten Island Advance article describing Lifflander's complaint about Lederman to the New York State Department of Health and mentioning in passing that Lederman had treated George Harrison. All of the quotations of Lifflander in this article relate generally to Lederman's practices and do not touch upon the Harrison suit.
The court is satisfied that Lifflander's conduct has not risen to the level of contempt. Although Lifflander may not have lived up to the spirit of the agreement, he appears to have lived by its letter. Furthermore, during a conference on this issue, Lifflander suggested to the court that in order to ensure his continued compliance with the Settlement Agreement, he would take a secondary role in the Ryan litigation. Based on this suggestion, the court has confidence that future issues of this nature can be avoided. However, the court continues to maintain jurisdiction over the Settlement Agreement and will work to ensure continued adherence to its provisions. The court would deem any future reference by Lifflander to the facts and issues involved in the Harrison case to be a serious breach.
SNR's already tenuous connection to the alleged contempt is resolved by the fact that Lifflander himself is not in contempt of the Settlement Agreement.
B. Lederman's Motion to Seal the Contempt Motion Papers is Granted
The court now turns to the issue of whether to unseal the papers submitted for this motion or to maintain them under seal along with the Settlement Agreement to which they relate. In reaching a determination to maintain the papers under seal but release this Memorandum Order, the court has sought to strike a balance between the privacy concerns of the parties and the importance of public access to the courts. In this regard, the court has attempted to lay out the facts involved at length so that the public has sufficient insight and understanding of the issues without releasing private information which could bring harm to the parties.
The parties have taken differing positions on the issue of whether to seal the motion papers. Lederman has urged the court to seal the filings, because he claims that their disclosure will cause him further detrimental publicity. Lederman rightly contends that his agreement to the settlement was premised in part on protecting his privacy and that disclosure of the papers would reopen issues that were to have been closed with the settlement. Lederman Reply Memo. at 22. Further, Lederman contends that Lifflander filled his papers with negative information and accusations in an attempt to punish him for bringing the contempt motion. Id. at 19-20. In particular, Lederman points to an affidavit by Gavin de Becker, who says he served as a consultant for the Harrisons regarding privacy issues, as containing hearsay that relates more to the actual merits of the underlying lawsuit than to the instant contempt motion. Id. at 19. SIUH has urged the court to maintain the Settlement Agreement under seal, but does not appear to have taken a position with respect to the motion papers themselves.
Representatives of the plaintiffs split on their contentions of whether the court should seal or unseal the papers. SNR, for its part, indicated at a conference on this motion that it opposes unsealing the motion papers, at least to the extent that they contain information going to the substance of the underlying settlement. Lifflander, however, contends that the papers should be unsealed. He argues that the public has a right, even a "real need," to be apprised of the issues involved in the contempt motion, which he characterizes as an effort by Lederman to silence his critics. Lifflander Memo. at 29.
"[T]he courts of this country recognize a general right to inspect and copy public records and documents, including judicial records and documents." Nixon v. Warner Communications, Inc., 435 U.S. 589, 597 (1978) (footnotes omitted). "The presumption of access is based on the need for federal courts, although independent — indeed, particularly because they are independent — to have a measure of accountability and for the public to have confidence in the administration of justice." United States v. Amodeo, 71 F.3d 1044, 1048 (2d Cir. 1995) (Amodeo II).
The first issue to address is whether the motion papers constitute "judicial documents" that invoke the presumption of access. See SEC v. TheStreet.com, 273 F.3d 222, 231-32 (2d Cir. 2001). The Second Circuit has defined judicial documents as those that are "relevant to the performance of the judicial function and useful in the judicial process." United States v. Amodeo, 44 F.3d 141, 145 (2d Cir. 1995) (Amodeo I). The motion papers submitted by the parties were relied upon by the court in reaching its adjudication of the alleged contempt. The papers brought to the attention of the court the facts surrounding the alleged contempt and also articulated arguments on both sides of the issue. As such, the papers were useful to the court in performing its judicial function. The court, therefore, finds that the motion papers are judicial documents and, as a result, are presumptively available to the public. TheStreet.com, 273 F.3d at 231.
Having determined that a presumption of access of the documents exists, the court must now determine the weight to be accorded the presumption. Amodeo II, 71 F.3d at 1048-49. Towards that end, the Amodeo II court offered the following guidance:
We believe that the weight to be given the presumption of access must be governed by the role of the material at issue in the exercise of Article III judicial power and the resultant value of such information to those monitoring the federal courts. Generally, the information will fall somewhere on a continuum from matters that directly affect an adjudication to matters that come within a court's purview solely to insure their irrelevance.Id. at 1049. Examples of instances in which the presumption is at its weightiest include a report relied on by a court in granting summary judgment or evidence that is introduced at trial. Id. (citations omitted). Conversely, where documents have less bearing on parties' rights, e.g., a denial of summary judgment where the final determination of substantive rights is merely postponed, or no bearing on substantive rights, e.g., documents passed between parties in discovery, the presumption decreases because these matters are not judicial "conduct at the heart of Article III." Id. at 1049-50 (citations omitted).
In this case, the court finds that the presumption favoring access is strong. While a finding of contempt may not exert as direct an impact on the parties' substantive rights as an adjudication affecting the outcome of a case like granting summary judgment, it nonetheless does implicate them. Although the court's determination of the contempt motion will most directly impact Lifflander and SNR, the parties will also be affected by the manner in which the court applies the Settlement Agreement in the future. By determining whether Lifflander and SNR are in contempt, the court will also necessarily be deciding the scope and effect of the agreement as it relates to the parties' interests in safeguarding their privacy. This impact on the parties is demonstrated by Lederman's decision to bring the motion.
The next step for the court in evaluating the presumption of access, is to "balance competing considerations against it."Amodeo I, 71 F.3d at 1050. Access to judicial documents is not absolute and can be restricted where the court is persuaded that the parties' interests in preventing disclosure outweigh those of the public in gaining it. Amodeo II, 44 F.3d at 147 (citingNixon, 435 U.S. at 1312, 1314). Such interests or "countervailing factors" can include "the privacy interests of those resisting disclosure." Amodeo I, 71 F.3d at 1050. Among the factors for a court to consider in evaluating the privacy interest of those opposing disclosure are the following: (1) the privacy interests of "innocent third parties," which constitute a "venerable common law exception to the presumption of access"; (2) "the degree to which the subject matter is traditionally considered private rather than public," a determination in which "family affairs, illnesses, embarrassing conduct with no public ramifications, and similar matters will weigh more heavily against access than conduct affecting a substantial portion of the public"; and (3) "the nature and degree of the injury" that will be caused by revealing the information, which may include determining "whether the nature of the materials is such that there is a fair opportunity for the subject to respond to any accusations therein." Id. at 1050-51.
Based on these factors, the court concludes that the privacy interests at stake in this case are sufficient to overcome the presumption of access. First, the presence of innocent third parties who would suffer serious harm by disclosure of information contained in the motions militates in favor of keeping them under seal. The plaintiffs in this case, while obviously parties to the litigation, are essentially third parties to this contempt action brought against their counsel. The plaintiffs clearly have an interest in receiving the benefit of the Settlement Agreement. In negotiating and agreeing to the settlement, the plaintiffs sought to limit publicity regarding George Harrison and the circumstances of his death. Disclosure of the motion papers would eviscerate much of that benefit by reopening the controversy and providing new details. "Courts have long declined to allow public access simply to cater to a morbid craving for that which is sensational and impure." Amodeo II, 71 F.3d at 1051 (internal citations omitted).
Second, the nature of much of the information in question is traditionally private as it involves illness and private conduct between the Harrisons and Lederman. As a result, there is less need for public disclosure than if it related to issues of a more public nature, such as the relationship of the management of a publicly owned company with its shareholders. See Amodeo II, 71 F.3d at 1050. Lifflander's contention that the public has a right to the information in order to "protect itself" from Lederman is unavailing. Lifflander Memo. at 34. While Lederman and Harrison did have a doctor-patient relationship, the issues involved in this case focus less on medical care than the events occasioned by Mr. Harrison's unique renown and fame. In fact, the mutually agreed upon public statement regarding the settlement expressly noted that "the medical care provided by Dr. Lederman and SIUH was not at issue in this case." Settlement Agreement at 5. As a result, the general public does not have a significant need for access to this information. Moreover, the court observes that Lederman has been, and continues to be, the subject of widespread publicity regarding his medical practice. Thus, to the extent that issues in this case may have a bearing on the public, the court is confident that they will brought to light in other ways.
In addition to the Ryan lawsuit, Lederman was also named as a defendant in a separate billion dollar claim filed in this court in August concerning patients from Italy.
Finally, the court finds that the nature and degree of injury that would be caused by unsealing these papers augurs against doing so. The principal concern in this area is that Lederman would likely be prevented by the terms of the Settlement Agreement from responding to any information contained in Lifflander's papers. Should Lederman want to denounce or clarify any claims in Lifflander's motion or exhibits, he would be unable to do so. The court's concern in this area is heightened by its recognition that the prompt settlement and resolution of this litigation prevented Lederman from having an opportunity to respond to the charges made against him. Allowing disclosure of more information at this time would enhance that deprivation and deny Lederman of much of the benefit of the Settlement Agreement that he achieved in part with his silence.
III. CONCLUSION
For the foregoing reasons, the court DENIES the contempt motion and SEALS the motion papers filed by the parties. The parties shall each bear their own costs. Counsel are directed to provide a copy of this Memorandum Order to each of the parties of record in this case and Olivia Harrison within seven (7) days.
SO ORDERED.