The Fifth Court of Appeals on Thursday ruled that Dallas District Judge Dale Tillery did not abuse his discretion when he declined to seal two sets of documents in a products liability case that Toyota Motor Corp. had sought to seal after a 2018 trial.
The documents at issue were related to design review of Toyota’s vehicles and what Toyota described as a blueprint of the initial design of a seat headrest that aimed to prevent whiplash injury.
Toyota had argued that these exhibits should be permanently sealed because they were trade secrets and that the Japanese automaker had met its burden to seal them because protecting the trade secrets outweighed the consequences of them not being available to the public.
But Judge Tillery, and now, the appeals court, rejected those arguments. The Fifth Court ruled that any of these arguments are moot since the exhibits had already been admitted to the public record during the trial without a prior objection on trade secrets grounds.
In a 22-page opinion, a three-judge panel pointed out that the jury was also never prohibited from discussing the exhibits with each other while deliberating or with anyone else after they returned their $242 million verdict. And because the release of information in open court constitutes a publication of that information, a party waives its rights to restrict its future use if it made no effort in real-time to limit disclosure of the information. In other words, the proverbial cat was already out of the bag.
“Because Toyota did not take adequate steps during trial to protect the exhibits and related testimony from public disclosure and did not seek an instruction prohibiting the jury and other non-parties from discussing the documents beyond the setting of the trial, we conclude any interest Toyota had in maintaining secrecy of the records does not clearly outweigh the presumption of openness,” Justice Robbie Partida-Kipness wrote in Thursday’s opinion.
In a statement, Toyota said that while it respects the Fifth Court’s ruling, “we continue to believe that Toyota’s proprietary and confidential business and trade secret information should be afforded continued protection under the terms of the protective order in this case.”
Frank Branson, the Reavises’ lead attorney at trial, called the appellate ruling “a good day for Texas consumers.
“When automakers are allowed to put a lid on exhibits offered at trial, only bad things can happen to the people who buy their cars,” he said.
The summer 2018 trial pitted Dallas couple Benjamin and Kristi Reavis against Toyota after a 2016 accident in the family Lexus caused permanent brain damage on the Reavises’ two small children. After a two-week trial, the jury found that Toyota was consciously indifferent to fixing seatback failure issues in its vehicles, hitting Toyota with a $242 million verdict that included $144 million in punitive damages. Judge Tillery later reduced the judgment to $209 million.
Toyota’s request to seal these court documents was only the latest example of similar behavior by the automaker throughout the litigation. In March 2018, while the parties were still in discovery, Toyota asked the court to seal a series of documents leaked years ago by a former in-house lawyer that aided Congress when it investigated Toyota’s acceleration defect scandal in 2010. Some of the documents included a deferred adjudication agreement that Toyota reached with the Department of Justice in 2014 for misleading the public about the unintended acceleration issues.
The leaked documents also contained communications between the in-house lawyer and others at Toyota, so Toyota had argued that they should be sealed because they contained privileged communications. But Judge Tillery denied the motion to seal, particularly because the documents were still widely available online, including on PACER, the Supreme Court of Texas’ website and CBS News’ website and because the documents concerned “matters that have a probable adverse effect upon health or safety.”
Speaking of CBS, the news outlet intervened in Toyota’s latest motion to seal and was joined by the mother of a five-year-old who, like the Reavis children, suffered similar catastrophic brain injuries after the family’s Toyota Camry was rear-ended.
At trial, the Reavises played segments of a 1992 investigative report by CBS’ 60 Minutes that revealed an industry-wide failure of automakers to address their seatback failure issues despite knowing about the problems for decades.
In addition to Branson, the Reavises’ trial team included Dallas attorneys Debbie Branson, Eric Stahl and Chip Brooker. Harry Reasoner and Marie Yeates of Vinson & Elkins are now leading the family through the appeal.
Anne Johnson of Haynes and Boone is leading the appellate process for Toyota, and the team also includes Haynes and Boone’s Nina Cortell and Jason Jordan, Gibson Dunn’s Allyson Ho and Brad Hubbard and Morgan Lewis’ Winstol Carter and Claire Kugler. At trial, Toyota was represented by Barnes & Thornburg’s Victor Vital and Elizabeth Brandon (now at Reed Smith) and Bowman and Brooke’s Jim Halbrooks and Suzanne Swaner.
Toyota’s appeal on the $209 million judgment itself is still pending.