Ashcraft v. Conoco Inc.

Decision Date27 October 1998
Docket Number98-1449,WILMINGTON,DEFENDANT-APPELLE,AND,MCGRAW-HILL,98-1212,KIRSTEN,98-1448,PLAINTIFF-APPELLEE,INCORPORATE,APPELLAN,STAR-NEW,98-4158,DEFENDANT-APPELLANT,No. 98-1213,98-1213
Citation218 F.3d 288
Parties(4th Cir. 2000) HURSHEL L. ASHCRAFT, ET AL., PLAINTIFFS, v. CONOCO, INCORPORATED,KAYO OIL COMPANY; TRIANGLE FACILITIES, INCORPORATED, DEFENDANTS. ASSOCIATED PRESS; THE NEWS & OBSERVER; THE CHARLOTTE OBSERVER; THE BALTIMORE SUN COMPANY; RICHMOND TIMESDISPATCH; THECOMPANIES, INCORPORATED; THE WASHINGTON POST; GANNETT COMPANY, INCORPORATED; DOW JONES AND COMPANY, INCORPORATED; NORTH CAROLINA PRESS ASSOCIATION; THE REPORTERS COMMITTEE FOR FREEDOM OF THE PRESS, AMICI CURIAE. HURSHEL L. ASHCRAFT, ET AL., PLAINTIFFS, v. CONOCO, INCORPORATED,B. MITCHELL, APPELLANT, AND KAYO OIL COMPANY; TRIANGLE FACILITIES, INCORPORATED, DEFENDANTS. ASSOCIATED PRESS; THE NEWS & OBSERVER; THE CHARLOTTE OBSERVER; THE BALTIMORE SUN COMPANY; RICHMOND TIMESDISPATCH; THECOMPANIES, INCORPORATED; THE WASHINGTON POST; GANNETT COMPANY, INCORPORATED; DOW JONES AND COMPANY, INCORPORATED; NORTH CAROLINA PRESS ASSOCIATION; THE REPORTERS COMMITTEE FOR FREEDOM OF THE PRESS, AMICI CURIAE. HURSHEL L. ASHCRAFT, ET AL., PLAINTIFFS, v. CONOCO, INCORPORATED,KAYO OIL COMPANY; TRIANGLE FACILITIES, INCORPORATED, DEFENDANTS. ASSOCIATED PRESS; THE NEWS & OBSERVER; THE CHARLOTTE OBSERVER; THE BALTIMORE SUN COMPANY; RICHMOND TIMESDISPATCH; THECOMPANIES, INCORPORATED; THE WASHINGTON POST; GANNETT COMPANY, INCORPORATED; DOW JONES AND COMPANY, INCORPORATED; NORTH CAROLINA PRESS ASSOCIATION; THE REPORTERS COMMITTEE FOR FREEDOM OF THE PRESS, AMICI CURIAE. HURSHEL L. ASHCRAFT, ET AL., PLAINTIFFS, v. CONOCO, INCORPORATED,B. MITCHELL, APPELLANT, AND KAYO OIL COMPANY; TRIANGLE FACILITIES, INCORPORATED, DEFENDANTS. ASSOCIATED PRESS; THE NEWS & OBSERVER; THE CHARLOTTE OBSERVER; THE BALTIMORE SUN COMPANY; RICHMOND TIMESDISPATCH; THECOMPANIES, INCORPORATED; THE WASHINGTON POST; GANNETT COMPANY, INCORPORATED; DOW JONES AND COMPANY, INCORPORATED; NORTH CAROLINA PRESS ASSOCIATION; THE REPORTERS COMMITTEE FOR FREEDOM OF THE PRESS, AMICI CURIAE. UNITED STATES OF AMERICA,, v. KIRSTEN B. MITCHELL,, ASSOCIATED PRESS; THE NEWS & OBSERVER; T
CourtU.S. Court of Appeals — Fourth Circuit

Appeals from the United States District Court for the Eastern District of North Carolina, at Wilmington.

W. Earl Britt, Senior District Judge. (CA-95-187-BR3-7) [Copyrighted Material Omitted] Argued: Floyd Abrams, Cahill, Gordon & Reindel, New York, New York, for Appellants. Jonathan Drew Sasser, Moore & Van Allen, P.L.L.C., Raleigh, North Carolina, for Appellee Conoco; David William Long, Poyner & Spruill, L.L.P., Raleigh, North Carolina, for Appellee United States. On Brief: Landis C. Best, Cahill, Gordon & Reindel, New York, New York; George Freeman, Assistant General Counsel, The New York Times Co., New York, New York; Mark J. Prak, Brooks, Pierce, Mclendon, Humphrey & Leonard, L.L.P., Raleigh, North Carolina; Stephen T. Smith, Mcmillan, Smith & Plyler, Raleigh, North Carolina, for Appellants. David E. Fox, Andrew B. Cohen, Moore & Van Allen, P.L.L.C., Raleigh, North Carolina; George A. Phair, Senior Counsel, Conoco, Inc., Houston, Texas, for Appellee Conoco. Rodney A. Smolla, Marshall-Wythe School of Law, College of William And Mary, Williamsburg, Virginia, for Amici Curiae.

Before Widener and Luttig, Circuit Judges, and Catherine C. Blake, United States District Judge for the District of Maryland, sitting by designation.

Reversed by published opinion. Judge Luttig announced the judgment of the court and wrote an opinion for the court in Parts I, IIB, IIC, and III, in which Judge Blake joined, and in Part III, in which Judge Widener joined in part. Judge Blake wrote an opinion concurring in part. Judge Widener wrote a concurring and dissenting opinion.

OPINION

Luttig, Circuit Judge.

The United States District Court for the Eastern District of North Carolina held Kirsten B. Mitchell, a reporter for the Wilmington, North Carolina Morning Star newspaper, in criminal contempt under 18 U.S.C. § 402 and civil contempt under 18 U.S.C. § 401 for opening an envelope, in which was enclosed a confidential settlement agreement, and reading the agreement, which had been placed under seal by the district court. The district court held the Morning Star in civil contempt under 18 U.S.C. § 401 for reporting the previously confidential settlement amount and imposed upon the newspaper, joint and severally with Mitchell, a fine of $600,000. Both Mitchell and the Morning Star appeal from the district court's contempt orders.

We conclude -- and conclude that it could not reasonably be found otherwise -- that the "decree" that Mitchell allegedly violated was not a bona fide decree of a court, and that even if it were, not only was the decree insufficiently specific to support a criminal contempt conviction, but Mitchell also did not act with the contumaciousness necessary to prove criminal contempt. We therefore reverse Mitchell's criminal conviction. We also reverse the district court's orders of civil contempt against both Mitchell and the Morning Star because the sealing order upon which these punishments were premised failed to comply with the requirements of our decision in In re Knight Publishing Company, 743 F.2d 231 (4th Cir. 1984).

I.

Plaintiff-appellee Conoco, Inc., and two of its subsidiaries (hereinafter "Conoco") were sued five years ago by 178 trailer park residents in Wilmington, North Carolina, for allegedly contaminating the residents' drinking-water supply. The liability phase of this lawsuit concluded with a jury verdict in the residents' favor that found Conoco liable for both compensatory and punitive damages. Before the jury concluded its deliberations on the amount of punitive damages to be awarded, however, Conoco and the residents reached a comprehensive and confidential settlement of the dispute in the amount of $36 million.

In order to preserve the confidentiality of the settlement terms, Conoco and the residents moved the district court for permission to file and maintain the settlement agreement and related documents under seal. Four days later, on September 22, 1997, without having provided public notice or an opportunity for interested parties to object, the district court granted the motion "for good cause shown" in a two-page order which was entered on the court's docket. J.A. 67-68; 46-47. The settlement documents were thereafter delivered to the district court in a closed white envelope after which time the court opened the envelope, signed the settlement agreement to indicate its approval, and returned the agreement to the original envelope. The envelope was then delivered to the clerk's office to be placed with the other documents related to the case. J.A. 77, 164.

Less than one month later, the Morning Star published a story disclosing the $36 million settlement amount agreed upon by Conoco and the plaintiff-residents and memorialized in the settlement agreement between the parties. The story reported that "[s]ources familiar with the settlement revealed its terms on condition of anonymity." J.A. 432. It further reported that "[a] document confirming the settlement amount was among public documents given to a Morning Star reporter [...] by a clerk at the federal courthouse in Raleigh." J.A. 432.1 The reporter referenced in the story was defendant-appellant Kirsten B. Mitchell.

The day before the story ran in the Morning Star, Mitchell, who previously had had no involvement with the case between Conoco and the residents, J.A. 267, had been asked by her editor to go to the clerk's office and review any documents in the case between Conoco and the residents that had been filed "since the settlement." J.A. 533. Upon arriving at the clerk's office, Mitchell asked to see "[e]verything since the settlement" that was in the case file. J.A. 273. In response, Anne Caviness, the deputy clerk responsible for the case, brought to the clerk's office counter a "pile of documents," which included the white envelope containing the sealing order and the confidential settlement agreement at issue in this case.2 Before handing the pile of documents to Mitchell across the counter, however, Caviness removed a large brown envelope from the pile, informing Mitchell: "You can't have this, this is a sealed document." J.A. 533. Mitchell responded "That's fine, I don't need to see that." J.A. 273. According to Caviness, Mitchell assented with "absolutely... no resistance. She was very cooperative." J.A. 182.

Mitchell then took the documents over to a bench in the clerk's office, and began skimming through them, chronologically "from the earliest to the most recent," according to her testimony. J.A. 274-75. When Mitchell came to the white envelope containing the settlement agreement, she saw the partial word and word "ENED OPENED," which appeared in red and white letters through a cellophane window on the back of the envelope. J.A. 283, 293. As described by the district court in its January 1998 order:

The back of the envelope had a flap folded down from the top and a window centered in the flap with the following let ters appearing in red and white: "ENED OPENED". Just adjacent to the flap appeared the following words in red: "Caution: The word `OPENED' appears in the window panel to indicate that the envelope has been opened." J.A. 533.

The envelope flap...

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