Penguin Books USA Inc. v. Walsh

• Decision Date: 27 March 1991
• Docket Number: D,No. 1297,1297
• Citation: 929 F.2d 69
• Parties: PENGUIN BOOKS USA INCORPORATED; Jeffrey R. Toobin, Plaintiffs-Appellees, v. Lawrence E. WALSH; Office of Independent Counsel, Defendants-Appellants. ocket 91-7131.
• Court: U.S. Court of Appeals — Second Circuit

Page 69

929 F.2d 69

PENGUIN BOOKS USA INCORPORATED; Jeffrey R. Toobin Plaintiffs-Appellees, v. Lawrence E. WALSH; Office of Independent Counsel Defendants-Appellants.

No. 1297, Docket 91-7131.

United States Court of Appeals Second Circuit.

Argued March 7, 1991.

Decided March 27, 1991.

Guy Miller Struve, Davis, Polk & Wardwell, New York City (Seth Richard Lesser, Michael D. Vhay, of counsel), for defendants-appellants.

Robert H. Baron, Cravath, Swaine & Moore, New York City (Brooks R. Burdette, Augustine V. Cheng, Andrew W. Hayes, Cravath, Swaine and Moore, Aaron R. Marcu, Howard Darby & Levin, New York City, of counsel), for plaintiff-appellee Toobin.

Martin Garbus, Frankfurt, Garbus, Klein & Selz, New York City, for plaintiff-appellee Penguin Books USA.

Before KAUFMAN, KEARSE and PRATT, Circuit Judges.

IRVING R. KAUFMAN, Circuit Judge:

Faced with proliferating caseloads and essentially static resources, our nation's courts engage in a struggle to assure litigants their rightful day in court. Actions that undermine orderly procedures squander precious public resources and contribute to what is fast becoming a crisis of epic proportions. When parties invoke the judicial process and secure favorable declaratory relief--receiving a court's imprimatur to engage freely in what otherwise might be characterized as dubious behavior--it is not unreasonable to expect them to postpone further their conduct until their opponent has been afforded the safeguard of appellate review. Basic notions of fairness dictate that successful litigants who render moot an appeal will not receive our assistance in insulating district court decisions from scrutiny.

We are presented with a dispute concerning the publication of a book that provides an inside account of the investigation and prosecution of Lt. Col. Oliver North for his After the appeal was scheduled, but before oral argument was heard, plaintiffs-appellees Toobin and Penguin decided to publish Opening Arguments, notwithstanding the obvious risk of mootness. Because we are of the view that publication of Toobin's book eliminates the controversy before us, we dismiss the appeal as moot, vacate the lower court order and remand with directions to dismiss the complaint.

involvement in what has come to be known as the "Iran-Contra" affair. In the proceedings below, Judge Keenan entered a declaratory judgment stating that publication of Opening Arguments: A Young Lawyer's First Case--United States v. Oliver North, authored by Jeffrey R. Toobin and published by Penguin Books USA, Inc. ("Penguin"), would not violate any fiduciary or contractual duties owed by Toobin to Independent Counsel (and former federal judge) Lawrence E. Walsh and the Office of Independent Counsel ("OIC"), the entity charged with prosecuting Iran-Contra.

BACKGROUND

The instant proceedings concern Jeffrey Toobin's activities in connection with the publication of his book, Opening Arguments. In January 1987, Toobin was hired by Judge Walsh to serve as Associate Counsel to the OIC team prosecuting North, thereby affording him access to highly confidential insights and materials regarding the proceedings. While employed by the OIC, Toobin signed several non-disclosure agreements obligating him to keep confidential certain information he acquired during the investigation. In particular, at the beginning of his term, Toobin signed three documents which required him to preserve grand jury secrets and to submit for review all classified or classifiable information prior to its dissemination. In addition, on May 4, 1989, the day he left the OIC, Toobin signed an agreement which provided that he would not, without written approval, divulge "[i]nvestigative material compiled by [the OIC] which relates directly/indirectly to this investigation and its sources, both U.S. and foreign."

Despite this, during his tenure at the OIC, Toobin accumulated twenty-two spiral binders containing thousands of pages of notes taken during internal OIC meetings. And, after terminating his employment, he retained as many additional pages of working documents, including memoranda written by Judge Walsh and other documents revealing investigation strategies and results. Toobin made use of these materials in writing Opening Arguments.

Just prior to his departure, Toobin informed Judge Walsh that he planned to write a book concerning his experiences at the OIC. Two weeks later, Toobin submitted for approval a portion of the manuscript for his proposed book. In response, Guy Miller Struve, Judge Walsh's second in command at the OIC, wrote Toobin, objecting to the inclusion of internal material in his draft. Toobin in turn protested that no law or privilege barred discussion of all inter-office business, even when the material had not previously been publicly disclosed.

For the next several months, Toobin continued to submit to Walsh drafts of completed chapters; and, the OIC consistently registered its disapproval in general terms. Several letters from Struve indicated his belief that many of the passages contained office confidences and violated Federal Rule of Criminal Procedure Rule 6(e) pertaining to grand jury secrecy. Two installments were also sent to the CIA for review.

In March 1990, after the CIA had cleared the material for publication, Toobin sent Walsh a final draft. The following month, Judge Walsh advised the Department of Justice that it should take "all appropriate administrative steps with respect to the dissemination and threatened publication" of Toobin's book. The Counsel for Intelligence Policy at the Justice Department, Mary C. Lawton, found "only one instance of classified information" and declined to take any action against Toobin.

In October 1990, Walsh and Struve drafted a proposed letter to Hal Lieberman, Chief Counsel of the First Appellate Division of the New York State Supreme Court

Departmental Disciplinary Committee, concerning Toobin, a member of the New York State bar. The letter stated that they believed dissemination and impending publication of Opening Arguments violated Toobin's legal responsibilities under Disciplinary Rule 4-101 of the Code of Professional Responsibility, regarding preservation of client secrets and confidences. Though the letter was never sent to the Disciplinary Committee, it eventually reached the desk of Toobin's current employer, Andrew J. Maloney, the United States Attorney for the Eastern District of New York.

PROCEEDINGS BELOW

In November 1990, Toobin and Penguin commenced a lawsuit in federal court for the Southern District of New York. They sought injunctive relief against further harassment by appellants and a declaratory judgment that publication of Opening Arguments did not violate either Fed.R.Crim.P. 6(e) or any other legal obligation owed by Toobin to appellants.

Following a trial on the merits, at which only Toobin testified, Judge Keenan granted the declaratory relief requested by Toobin and Penguin, but denied their request for a permanent injunction barring future government interference with publication of Opening Arguments.

The day after Judge Keenan's decision, February 1, 1991, appellants' request for an expedited appeal was granted by this Court, and argument was scheduled for March 7. In the interim, however, it came to our attention that Opening Arguments had been published and widely circulated before this Court had an opportunity to hear arguments or pass on the merits of the appeal from the district court judgment.

DISCUSSION

Since the claims before us were initially based on conduct not yet undertaken, jurisdiction was premised on the Declaratory Judgment Act, 28 U.S.C. Secs. 2201 and 2202. Congress established the declaratory judgment procedure so that parties who were uncertain of their rights could adjudicate their claims without first engaging in dubious conduct.

Our ability to pass on the future rights and relations of parties, however, is not without significant constitutional and statutory limits. A federal court lacks the power to render advisory opinions and the authority "to decide...