A Victory for the Public   

A Montana court says settlement terms can't be kept secret.

COURT PROCEEDINGS ARE SUPPOSED TO be open to the public. But a civil dispute that ends up in a settlement before trial may become shrouded in secrecy. Judges all too frequently agree to seal settlement figures to induce the parties to drop the case, thereby reducing overcrowded dockets.
Whatever the merits of secret settlements in cases between private parties might be, a different set of interests comes into play when one of the litigants is a state agency. As the Montana Supreme Court ruled in mid-November, the public's right to know how much the state paid to settle a case outweighs the rights of plaintiffs to protect their privacy. The ruling came as part of the case of Tamara Pengra, who in 1995 was murdered in a parking lot near Helena by Russell VanKirk, a convict on probation. Pengra's widower, Steve, and daughter, Tiffany, sued the state, claiming that officials had been negligent in supervising VanKirk. In December 1999, just five days before the case was to go to trial, the state settled with the Pengras.
While the settlement was being negotiated, the Pengras asked state District Court Judge Dorothy McCarter to seal the terms and conditions of the settlement. They claimed that disclosing the terms would harm their emotional well-being, and would interfere with "closure and healing" for Tiffany.
Several news organizations promptly intervened to challenge the Pengras' request. They argued that under Montana law, all the terms of such government settlements are public records that must be made available to anyone who wishes to see them. The Pengras could not possibly have expected otherwise, they argued. McCarter agreed, ruling in January 2000 that the family's decision to sue in state court proved that they could not have believed that the resolution of their dispute would be kept secret.
However, she agreed to keep the settlement under seal to give the Pengras a chance to appeal to the state Supreme Court.
On appeal, the Pengras argued that they had agreed to a settlement to avoid further publicity about the crime, contending that additional news reports would "open another wound" and be particularly harmful to Tiffany. They added that the Montana Constitution protects individuals' right to privacy, which, in this case, outweighs the public's interest in knowing the settlement amount.
Attorneys for the media countered that the state statute makes clear that taxpayers have a right to know how much the state pays to settle a claim.
In mid-November, a divided Supreme Court ruled 4-3 in favor of the news organizations. Chief Justice Jean A. Turnage wrote in the opinion that whatever harm the Pengras had suffered from publicity about the case had already occurred. The state Legislature had made a judgment call that settlement agreements involving the government would be public, and anyone who sues the state must expect that they will give up some elements of privacy in the process.
The Montana disclosure requirements are aimed primarily at ensuring that the public knows how much money is spent as the result of errors made by the government. Whatever right to privacy the Pengras may have, it does not outweigh the public's right to know, which is also guaranteed by the state constitution.
Justice W. William Leaphart, joined by two other justices, dissented. He argued that the statute was unconstitutional because it elevated the public's right to know above the right to privacy.
He contended that the ruling was the first step down a slippery slope that would permit the Legislature, if it chose, to declare that all medical and tax records of people suing in the state's courts would be public records.
"The courts are rendered helpless bystanders, powerless to require any deference to the individual right to privacy," Leaphart concluded.
Surely it's not quite so bad as that, Justice Leaphart. The Montana Constitution's right to know has never been absolute. It requires courts and the Legislature to defer to individual's privacy rights when they exceed "the merits of public disclosure." And, as District Judge McCarter suggested in her ruling, when reporting on the settlement, "the media hopefully will exercise the type of sensitivity that an intelligent public expects and the victim and her family deserve."
But as a matter of law, at least in this case, the public's right to this information seems secure. At a time when courts around the country routinely seal settlement agreements, it is refreshing to see a state high court come out in favor of openness, rather than secrecy.
As its slogan says, Montana may be "The Last Best Place" for public accountability.