In Re the Knoxville News-Sentinel Company, Inc., (83-5095). In Re Knoxville Journal Corporation and Tennessee Newspapers, Inc., (83-5096)

723 F.2d 470, 38 Fed. R. Serv. 2d 242, 10 Media L. Rep. (BNA) 1081, 1983 U.S. App. LEXIS 14537
CourtCourt of Appeals for the Sixth Circuit
DecidedDecember 13, 1983
Docket83-5095, 83-5096
StatusPublished
Cited by367 cases

This text of 723 F.2d 470 (In Re the Knoxville News-Sentinel Company, Inc., (83-5095). In Re Knoxville Journal Corporation and Tennessee Newspapers, Inc., (83-5096)) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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In Re the Knoxville News-Sentinel Company, Inc., (83-5095). In Re Knoxville Journal Corporation and Tennessee Newspapers, Inc., (83-5096), 723 F.2d 470, 38 Fed. R. Serv. 2d 242, 10 Media L. Rep. (BNA) 1081, 1983 U.S. App. LEXIS 14537 (6th Cir. 1983).

Opinion

BOYCE F. MARTIN, Jr., Circuit Judge.

In this appeal, two Tennessee newspapers, intervening parties in the lawsuit between United American Bank and the Federal Deposit Insurance Corporation, are seeking a writ of mandamus. The newspapers request that we vacate an order of the district court which permitted the bank to remove from the court’s record, prior to public inspection, two exhibits the bank had filed in its lawsuit against the FDIC.

On January 25, 1983, bank examiners of the FDIC, pursuant to their statutory authority to regulate federally-insured state banks, presented the bank officials with a list of 423 questionable loans in United American’s portfolio. The list contained the names of borrowers and the amount of each loan. The bank responded by submitting to the FDIC a loan-by-loan defense of each of the 423 loans listed by the FDIC as questionable. This response contained extensive discussion of the borrower’s financial condition, prospects and personal life.

During this time, stories were appearing in the Tennessee news media discussing the FDIC’s concern over the bank’s financial condition. Apparently in response to this media attention, the bank issued a press release on January 28, 1983 disclosing its fourth-quarter and year-end financial results for 1982. The figures relied upon in this press release came from an audit report prepared by the bank’s own independent accountants. The press release did not mention the FDIC’s list of questionable loans.

*472 On February 4, 1983, the FDIC served on the bank a Temporary Order to Cease and Desist which required that:

Immediately upon service of this TEMPORARY ORDER TO CEASE AND DESIST, the Bank shall correct the false or misleading public statements disseminated by the Bank, or officers, directors, or employees of the Bank, on or about January 29, 1983.
The Bank shall file an amended consolidated Report of Condition and an amended consolidated Report of Income as provided under section 7(a) of the Federal Deposit Insurance Act (12 U.S.C. § 1817(a)) which shall accurately reflect the financial condition of the Bank as of December 31, 1982.

On February 8, the bank filed suit in the district court pursuant to 12 U.S.C. § 1818(c)(2), seeking an injunction to prohibit the FDIC from enforcing its Temporary Cease and Desist Order.

Upon filing, counsel for the bank was granted, ex parte, a protective order from the district court sealing the entire court record. At that time, the record contained the bank’s complaint, ten exhibits, and responsive pleadings. Included among the ten exhibits were the FDIC’s list of questionable loans, Exhibit 3, and the bank’s loan-by-loan response, Exhibit 4. The protective order, dated February 8, barred all public access to the court file and ordered the parties to keep confidential any information derived from the court file. On February 11, the Knoxville News-Sentinel Co., whose reporters had been assigned to monitor the litigation between the bank and the FDIC, filed in this court a Petition for a Writ of Mandamus to vacate the protective order. On February 14, the Knoxville Journal Corporation and Tennessean Newspapers, Inc., also filed a Petition for a Writ of Mandamus. The newspapers argued that the lawsuit between the bank and the FDIC dealt with events and personalities of “immense public interest.” They contended public access to the file was needed to facilitate further discussion and debate among the citizens of Tennessee about these important matters.

In a memorandum opinion dated February 11, 1983, the district court set forth its reasons for sealing the court record. First, the court noted the sensitive nature of the exhibits relating to the bank’s customers and the bank’s loan policy. The district court acknowledged the bank’s contention that public disclosure “would result in the FDIC prevailing in the action before the issues are joined or any necessary hearing is held.” In light of these circumstances, the court concluded there was authority to deny public access to the court file in order to “protect the interest of the Bank in this case.”

On February 14, the Tennessee Commissioner of Banking ordered United American closed because of extensive loan losses, and appointed the FDIC as receiver of the bank. On February 15, the FDIC negotiated an agreement with the First Tennessee Bank of Knoxville to assume all the assets and liabilities of United American Bank. On the same day, the district court issued an order dismissing the lawsuit between United American and the FDIC. This order also lifted the February 8 protective order, but directed that Exhibits 3 and 4 be withdrawn from the court file and returned to counsel for the bank, “with the understanding that the exhibits will be preserved and submitted to the Sixth Circuit if requested by that Court.” On February 18, the newspapers filed amended Petitions for a Writ of Mandamus in this court seeking an order vacating the February 15 order to the extent that it permits the removal of Exhibits 3.and 4 from the district court’s records.

In- our view, this appeal presents two separate issues:

(1) Did the district court’s February 15 order, which dismissed the underlying lawsuit between the bank and the FDIC and provided for public access to the remaining documents in the court file, moot the newspapers’ claims against the district court?
(2) Did the district court abuse its discretion by permitting counsel for the *473 bank to remove Exhibits 3 and 4 from the court’s file?

Our conclusion after a review of the record indicates no abuse of discretion in ordering Exhibits 3 and 4 expunged from the record. We also find that the remainder of the newspapers’ claims against the district court have been rendered moot.

Regarding the first issue, it is well established that we do not decide moot questions. Hall v. Beals, 396 U.S. 45, 90 S.Ct. 200, 24 L.Ed.2d 214 (1969); Golden v. Zwickler, 394 U.S. 103, 89 S.Ct. 956, 22 L.Ed.2d 113 (1969). Here, the newspapers have requested that we instruct the district court to refrain from issuing orders similar to the order of February 8,1983. They complain that such an order violates their common law and first amendment rights of access to judicial records. They argue that only definitive instructions from this court will prevent future protective orders from being issued. This we decline to do. International Union, etc. v. Dana Corp., 697 F.2d 718 (6th Cir. 1983).

It is undisputed that the newspapers now have access to the court’s entire file, except for Exhibits 3 and 4. Putting aside their right of access to these latter two exhibits, the newspapers are now in the same position they would have been had no protective order issued. There is no indication the district court intends to place future restrictions on the public’s access to the file in this case.

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723 F.2d 470, 38 Fed. R. Serv. 2d 242, 10 Media L. Rep. (BNA) 1081, 1983 U.S. App. LEXIS 14537, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-knoxville-news-sentinel-company-inc-83-5095-in-re-knoxville-ca6-1983.