USA v. Ladd, 99-2301

• Decision Date: 27 June 2000
• Docket Number: No. 99-2301,99-2301
• Citation: 218 F.3d 701
• Parties: (7th Cir. 2000) UNITED STATES OF AMERICA, Plaintiff-Appellee, v. WILLIAM D. LADD, Ronald D. Lowder and James R. Berger, Defendants-Appellees. APPEAL OF: ASSOCIATED PRESS, CHICAGO TRIBUNE COMPANY, COPLEY PRESS, INCORPORATED, et al
• Court: U.S. Court of Appeals — Seventh Circuit

Page 701

218 F.3d 701 (7th Cir. 2000)

UNITED STATES OF AMERICA, Plaintiff-Appellee, v. WILLIAM D. LADD, Ronald D. Lowder and James R. Berger, Defendants-Appellees.

APPEAL OF: ASSOCIATED PRESS, CHICAGO TRIBUNE COMPANY, COPLEY PRESS, INCORPORATED, et al.

No. 99-2301

In the United States Court of Appeals For the Seventh Circuit

Argued December 7, 1999

Decided June 27, 2000

Appeal from the United States District Court for the Central District of Illinois. No. 96 CR 30036--Richard Mills, Judge.

Before EASTERBROOK, RIPPLE and DIANE P. WOOD, Circuit Judges.

RIPPLE, Circuit Judge.

This case comes to us as a successive appeal to our earlier decision, In re Associated Press, 162 F.3d 503 (7th Cir. 1998). In that decision, we held that media organizations covering the criminal trial of James Berger could intervene in the criminal proceedings for the limited purpose of seeking documents sealed by the district court. On remand, the district court unsealed numerous documents, but required that the identity of unindicted coconspirators be kept under seal. Statements of these individuals had been admitted at Berger's trial pursuant to the hearsay exception for unindicted coconspirators. In this appeal, we must decide whether the identity of those unindicted coconspirators should be released to the public. For the reasons set forth in the following opinion, we reverse the judgment of the district court and remand the case for further proceedings.

I BACKGROUND

On August 23, 1996, Management Services of Illinois and four individual defendants were indicted on 25 counts involving bank fraud, money laundering, and a scheme to defraud the Illinois Department of Public Aid. On October 24, 1996, the grand jury issued a superseding indictment that added James R. Berger as a defendant to the charges relating to the Public Aid scheme. On June 23, 1997, the district court severed Berger's case. The other defendants went to trial during the summer of 1997. Berger's trial began in November 1997.

At Berger's trial, the Government sought to introduce the statements of alleged coconspirators pursuant to Federal Rule of Evidence 801(d)(2)(E), the hearsay exception for coconspirator statements.¹ The district court admitted conditionally the statements "subject to the Government's eventual proof of the foundational elements at trial." R.374 at 3.

Various news organizations covering the trial ("the Press") sought access to numerous documents introduced at trial. The district court initially denied the Press' motion to intervene. We reversed and remanded with instructions to allow the Press to intervene. See Associated Press, 162 F.3d at 508-09. The Press then sought access both to sealed documents and to information regarding the videotaped deposition of Illinois Governor James Edgar. See id. at 509-13. In our opinion remanding the case, we wrote:

[W]e believe that in this case the appropriate course at this juncture is that the district court articulate its reasons for denying access to the documents that are under seal. A careful examination by the district court and an explanation adequate to permit thorough appellate review is especially warranted in this case because the defendant in the underlying criminal action has maintained that certain material ought to be kept under seal because it was not made part of the public record. Id. at 510 (citation omitted). To allow for meaningful appellate review, we also asked the district court to describe the documents and to provide the reasons why they were sealed. See id.

In the course of the proceedings on remand, the court offered two reasons for initially having sealed the documents. See United States v. Martin, 38 F. Supp.2d 698 (C.D. Ill. 1999). First, it believed that, because of concerns over publicity during the trial, non- disclosure was necessary to protect the defendants' right to a fair trial. Second, the court believed that non- disclosure was required to ensure that the Government's ongoing investigation was not compromised. Because neither of these reasons justified keeping documents under seal after trial, the district court later unsealed almost all of the documents.

The court decided, however, to keep under seal the names of five unindicted coconspirators whose testimony was admitted at trial. Noting that it had made a public explanation of why it had admitted their testimony, the district court took the view that disclosing the names of the unindicted coconspirators would not promote an understanding of or confidence in the criminal justice system. It further said that the only reason for disclosing the identities was to stigmatize the individuals. The district court concluded that the individuals had a high privacy interest because they would be affected adversely by the public's knowledge that they had been named as coconspirators in the indictment, but would have no opportunity to clear their names at trial. In the court's view, the damage to their reputations would be irreparable.

II DISCUSSION

A.

Central to our decision today--and long embedded in our case law and indeed in that of the Supreme Court--is the strong presumption that all trial proceedings should be subject to scrutiny by the public. As the Supreme Court has written:

[A] trial courtroom also is a public place where the people generally--and representatives of the media-- have a right to be present, and where their presence historically has been thought to enhance the integrity and quality of what takes place.

Richmond Newspapers v. Virginia, 448 U.S. 555, 578 (1980). Again in Press- Enterprise Co. v. Superior Court, 464 U.S. 501, 509 (1984), the Court wrote that the public also presumptively has a right of access to the records of judicial proceedings. See also Smith v. United States District Court Officers, 203 F.3d 440, 441 (7th Cir. 2000) [hereinafter Court Officers]. We emphasized the importance of this presumption in our earlier opinion in this case. See Associated Press, 162 F.3d at 506. This presumption is rebuttable to preserve "higher values" so long as the suppression is narrowly tailored to preserving those values. Id.; see also Press-Enterprise, 464 U.S. at 510; Grove Fresh Distrib., Inc. v. Everfresh Juice Co., 24 F.3d 893, 897 (7th Cir. 1994).

The Press seeks access to documents that identify by name unindicted coconspirators whose hearsay statements were considered as evidence during trial. We have no doubt that there is an important public interest in revealing this information. The source of evidence admitted at trial and the circumstances surrounding its admittance are important components of the judicial proceedings and crucial to an assessment of the fairness and the integrity of the judicial proceedings. See Napue v. Illinois, 360 U.S. 264, 269 (1959); United States v. Kaufmann, 783 F.2d 708, 710 (7th Cir. 1986) (quoting Napue). Therefore, when the hearsay statement of an unindicted coconspirator is entered into evidence, it is a very different situation than one in which the alleged coconspirator is identified by the Government during a preliminary phase of the case. We therefore find ourselves in respectful disagreement with our colleague in the district court who took the view that the situation before us ought to be controlled by the decision of the Court of Appeals for the Third Circuit in United States v. Smith, 776 F.2d 1104 (3d Cir. 1985) [hereinafter Smith].

In Smith, the court refused to allow the release of the names of individuals identified as potential coconspirators on a bill of particulars. It concluded that identification by the Government created the chance of career-ending harm to the individuals on the list, and that those individuals, some of whom might be entirely innocent, would have no opportunity to vindicate themselves. See id. at 1113-14. In that case, the Government had provided no factual context for its inclusion of particular names on the list. See id. at 1113. Judge Mansmann, concurring in the judgment, em phasized that the Government had admitted that it had "used a broad brush" in deciding to include names on the list "for the tactical purpose of not limiting the evidence it could produce at trial." Id. at 1116-17 (Mansmann, J., concurring).

We need not decide definitively the correctness of the holding in Smith. It is sufficient to point out that the situ ation there was quite different than the one before us. Here the hearsay statements of the coconspirators were admitted into evidence. For coconspirator statements to be admitted pursuant to Rule 801(d)(2)(E), the Government must prove by a preponderance of the evidence that a conspiracy existed, that both the declarant and the defendant were members of the conspiracy, and that the statements were made in the course and in furtherance of the conspiracy. See United States v. Mojica, 185 F.3d 780, 788 (7th Cir.), cert. denied, 120 S. Ct. 515 (1999); United States v. Powers, 75 F.3d 335, 339 (7th Cir. 1996). The district court, in admitting the statements, found that those requirements had been met. The status of coconspirator was, therefore, grounded in an evidentiary basis far more solid than the assertion of the United States Attorney.²

The Third Circuit held in Smith that names of the unindicted coconspirators could be withheld because otherwise it was "virtually certain that serious injury [to reputation] will be inflicted." Smith, 776 F.2d at 1114. Here, however, where there is a more reliable basis for finding that the individuals were indeed coconspirators, that concern must yield to the public's right to know the sources of evidence considered by the jury at trial pursuant to the coconspirator exception to the hearsay rule.

The Government also notes that it has released to the public an explanation of how...