Once a secret is told, it is no longer a secret

July 15, 2018

When a San Antonio court case stood to impede on the people’s long-established right to public information — and the press’s vital First Amendment right to access that information on the public’s behalf — a group of media interveners, including my client, Houston Forward Times, felt compelled to take a stand. Last month, our coalition opposed an effort that sought to keep crucial court documents from the public eye. That same coalition has assembled again to appeal an adverse ruling stemming from that effort.

This issue arose in the Amrock-HouseCanary case — a mammoth intellectual-property dispute between two companies that value real estate using high-tech models. In March, a Bexar County jury sided with HouseCanary, deciding that Amrock had misappropriated its trade secrets, awarding an astounding $706 million verdict. That will almost certainly be the largest U.S. trade-secrets verdict of the year, and it stretches the law in ways that will harm Texas business’s ability to fairly compete in high-tech industries.

Accordingly, many questions remain about the propriety of that astounding verdict. Yet HouseCanary immediately pressed the court to seal court exhibits from the public’s eye — a move that would kneecap the public’s ability to understand and evaluate the case’s merits.

District Court Judge David Canales initially rejected that attempt to seal documents, a welcome ruling that promoted transparency and preserved the integrity of the proceedings. Unfortunately, Canales recently reversed himself and moved to seal 13 of those vital documents. That reversal shuts out the public from critical information needed to understand the case.

This court-ordered secrecy calls for yet another intervention on behalf of First Amendment freedoms and transparency in the judicial system. The same media intervenors are now planning to appeal because Canales’ ruling was a misstep.

The documents that Canales sealed were the same documents that HouseCanary voluntarily submitted in open court. That voluntary action destroyed any claim HouseCanary had to keep these documents sealed — once you tell a secret, it is no longer secret. And once a party willingly reveals information in an open trial before a public audience, that information becomes public and can no longer be sealed. This sensible precedent has dictated the handling of court proceedings for decades. Yet Canales has upended that precedent at the worst possible time — in a case where the need for transparency is paramount.

Sealing of documents is appropriate in matters concerning legitimate issues of intellectual property. There are laws that permit restricting the public from accessing certain information, such as trade secrets, that need to remain secret to remain legally protected. Yet HouseCanary opted not to avail itself of those protections, and now it is too late.

Indeed, HouseCanary’s now-you-see-it, now-you-don’t strategy brings into question whether it can even maintain legal protection for its claimed trade secrets. To maintain legal protections for trade secrets, companies must sensibly take measures to protect their secrecy. Information voluntarily disclosed in the public arena thus loses trade-secret protection.

The public needs access to this information. The court exhibits in question could produce insight into how the San Antonio jury came to a $706 million verdict — and whether such a verdict is appropriate in any trade-secret case. If court documents reveal clear signs of a runaway jury, or the law of trade secrets has become inadequate, the public has a right to know. It is the public’s responsibility to evaluate such questions.

The ruling to seal exhibits retroactively from the public should thus trouble anyone who values transparency in governmental institutions. Keeping the documents unsealed is the only appropriate action if we are to maintain the public’s ability to hold our institutions accountable — including the judiciary. Failure to act now could spell similar disclosure problems in future cases.

J. Carl Cecere is owner of Cecere PC, a Dallas-based law firm devoted to U.S. Supreme Court and appellate advocacy. He represents the Houston Forward Times in its intervention in this case.

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