Newton v. National Broadcasting Co., Inc.

• Decision Date: 24 February 1984
• Docket Number: No. 83-1529,83-1529
• Parties: Carson Wayne NEWTON, aka Wayne Newton, Appellee, v. NATIONAL BROADCASTING COMPANY, INC., a Delaware corporation; RCA Corporation, a Delaware corporation; Brian Elliott Ross; Ira Silverman; Paul Greenberg; William Jack Small, Appellees, State of Nevada, State Gaming Control Board & Nevada Gaming Commission, Movants/Appellants.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 591

726 F.2d 591

Carson Wayne NEWTON, aka Wayne Newton, Appellee, v. NATIONAL BROADCASTING COMPANY, INC., a Delaware corporation;

RCA Corporation, a Delaware corporation; Brian Elliott Ross;

Ira Silverman; Paul Greenberg; William Jack Small, Appellees,

State of Nevada, State Gaming Control Board & Nevada Gaming

Commission, Movants/Appellants.

No. 83-1529.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted July 12, 1983.

Decided Feb. 24, 1984.

Dean P. Vernon, Gifford & Vernon, Morton R. Galane, Galane & Jimmerson, Las Vegas, Nev., Kenneth Kulzick, Lillick, McHose & Charles, Los Angeles, Cal., Paul Greenberg and William Jack Small, Broadcasting Co., Inc., Floyd Abrams, Cahill, Gordon & Reindel, New York City, for appellee.

James C. Giudici, Deputy Atty. Gen., Las Vegas, Nev., for movants/appellants.

David N. Webster, Earl C. Dudley, Jr., Nussbaum, Owen & Webster, Washington, D.C., for Brian Elliott Ross and Ira Silverman.

Appeal from the United States District Court for the District of Nevada.

Before GOODWIN and ANDERSON, Circuit Judges, and RYMER ^*, district judge.

PER CURIAM.

The Nevada State Gaming Control Board and Gaming Commission appeal from an order directing them to release certain of their records to Wayne Newton and the National Broadcasting Company for use in civil litigation.

On October 6, 1980, NBC Nightly News broadcast a report entitled "Wayne Newton and the Law" that focused on Newton's application for part ownership of the Aladdin Hotel and Casino in Las Vegas, Nevada. The broadcast emphasized Newton's relationship with Guido Penosi, an alleged organized crime figure. Newton sued NBC in the United States District Court for the District of Nevada, invoking the court's diversity jurisdiction and alleging defamation, civil conspiracy and infliction of emotional distress.

Newton and NBC jointly asked the district court for an order directing the Gaming Control Board and Gaming Commission to permit Newton and NBC to inspect and copy the Board and Commission files pertaining to Newton's application. Neither the Board nor the Commission are parties to the action between Newton and NBC. The district court confirmed a magistrate's order directing production over the objections of the Board and Commission that government privilege protect their files from disclosure. The Board and Commission now appeal to this court. The order has been stayed pending appeal.

The order directed to the Board and Commission is not in the form of a subpoena duces tecum, the usual means for discovery of documents from nonparties. See Fed.R.Civ.P. 45(b). Rather, the order purports to be issued under the authority of Nev.Rev.Stat. Sec. 463.120. ¹ In its memorandum decision, the district court stated that Sec. 463.120 does not provide an independent basis for discovery from nonparties, but held that the Board and Commission had waived this point by appearing before the magistrate to request a protective order under Fed.R.Civ.P. 26(c). Because we hold that we do not have jurisdiction of this appeal, we do not address the question whether the order was properly issued.

With the exception of a narrow range of interlocutory orders set forth in 28 U.S.C. Sec. 1292, this court's appellate jurisdiction extends only to final decisions of the district courts. 28 U.S.C. Sec. 1291. The district court's order is not an injunction for which interlocutory review is available under 28 U.S.C. Sec. 1292(a)(1), see United States v. Ryan, 402 U.S. 530, 91 S.Ct. 1580, 29 L.Ed.2d 85 (1971), nor does it fall within any of the other classes of interlocutory orders reviewable under Sec. 1292. The district court's order thus is reviewable only if it is a final decision within the meaning of Sec. 1291.

Because of the strong policy against hearing appeals piecemeal during the course of a judicial proceeding, the general rule is that an order regarding discovery is not an appealable final order. United States v. Nixon, 418 U.S. 683, 690-91, 94 S.Ct. 3090, 3098-3099, 41 L.Ed.2d 1039 (1974); United States v. Ryan; Cobbledick v. United States, 309 U.S. 323, 60 S.Ct. 540, 84 L.Ed. 783 (1940); Alexander v. United States, 201 U.S. 117, 26 S.Ct. 356, 50 L.Ed. 686 (1906); David v. Hooker, Ltd., 560 F.2d 412 (9th Cir.1977). To gain appellate review of a discovery order, a nonparty generally must refuse to comply with the order and subject himself to contempt. Cobbledick, 309 U.S. at 327, 60 S.Ct. at 542; Alexander, 201 U.S. at 121, 26 S.Ct. at 357. The finding of contempt is a final order and may be appealed. Id.

Requiring submission to contempt as a prerequisite to an appeal helps speed the judicial process by curtailing the number of appeals taken during the course of a litigation. As the Second Circuit explained in National Super Spuds, Inc. v. New York Mercantile Exchange, 591 F.2d 174, 180 (2d Cir.1979), "[b]oth sides benefit from having a second look." The risk that the contempt citation will not be overturned on appeal forces the person ordered to respond to consider carefully his resistance to discovery and encourages him to advance only well-founded objections. At the same time, the party seeking discovery may decide that the information sought is not important enough to warrant the costs and delays of obtaining a contempt citation and then justifying that citation upon the inevitable appeal. Id.

The rule, like most, is subject to several exceptions. For example, because it would be unseemly for a court to require the head of a coordinate branch of government to subject himself to contempt as a prerequisite for appeal, the Supreme Court permitted the President to appeal a district court's refusal to quash a subpoena duces tecum without his first being held in contempt. United States v. Nixon. An exception of more general applicability was developed in Perlman v. United States, 247 U.S. 7, 38 S.Ct. 417, 62 L.Ed. 950 (1918). In that case, a subpoena requested certain exhibits from a third party. The exhibits were the property of the appellant, who asserted a privilege against disclosure. The Court held that the appeal could proceed without a finding of contempt because it was unlikely that the third party would subject himself to a contempt citation simply to create for the person asserting the privilege a final order appealable under the general rule. United States v. Nixon, 418 U.S. at 691, 94 S.Ct. at 3099. See, e.g., In re Grand Jury Proceeding (Schofield), 721 F.2d 1221 (9th Cir.1983). The instant case does not fall within either of these exceptions.

Appellants ² ask us to create another exception to the rule of nonappealability. Specifically, they ask us to hold that a discovery order directed against a nonparty governmental entity is appealable in the absence of a contempt citation where the governmental entity raises a defense of governmental privilege. The Fifth Circuit has recognized such an exception and appellants claim that the Tenth Circuit has done so as well. We decline to follow those circuits and agree with the Second Circuit, which has refused to create the exception that appellants seek. National Super Spuds.

The Fifth Circuit held in Carr v. Monroe Manufacturing Co., 431 F.2d 384, 387 (5th Cir.1970), that "discovery orders may be appealable where a government privilege is asserted and the government...