                                                                                                                           Opinions of the United
2008 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


8-6-2008

In Re: Mid-Valley Inc
Precedential or Non-Precedential: Non-Precedential

Docket No. 07-2044




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Recommended Citation
"In Re: Mid-Valley Inc " (2008). 2008 Decisions. Paper 705.
http://digitalcommons.law.villanova.edu/thirdcircuit_2008/705


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                                                                NOT PRECEDENTIAL

                      UNITED STATES COURT OF APPEALS
                           FOR THE THIRD CIRCUIT
                                ____________

                                     No. 07-2044
                                    ____________

                         IN RE: MID-VALLEY, INC., et al.,

                                          Reorganized Debtors


                       ILLINOIS CENTRAL RAILROAD CO.,

                                                 Appellant

                      * Amended per Clerk’s Order dated 9/11/07
                                  ____________

                    On Appeal from the United States District Court
                        for the Western District of Pennsylvania
                                 (D.C. No. 06-cv-00941)
                    District Judge: Honorable Thomas M. Hardiman
                                     ____________

                      Submitted Under Third Circuit LAR 34.1(a)
                                    June 2, 2008

      Before: FISHER and JORDAN, Circuit Judges, and YOHN,* District Judge.

                                (Filed: August 6, 2008)
                                     ____________

                             OPINION OF THE COURT
                                  ____________



      *
        The Honorable William H. Yohn, United States District Judge for the Eastern
District of Pennsylvania, sitting by designation.
FISHER, Circuit Judge.

       Illinois Central Railroad Co. (“Illinois Central”) sought to intervene in a closed

bankruptcy matter in an attempt to obtain certain documents related to that case. The

Bankruptcy Court denied Illinois Central’s motion to obtain those documents, finding that

they were not judicial records. The District Court affirmed the Bankruptcy Court’s

decision on appeal. For the reasons set forth below, we will affirm the order of the

District Court.

                                               I.

       In December 2003, a number of debtors, including Mid-Valley, Inc. and Dresser

Industries, Inc., filed for Chapter 11 bankruptcy and reorganization (“Mid-Valley”). In

May 2004, the law firm of Guy & Brock filed a Verified Statement under Fed. R. Bankr.

P. 2019 in which it averred that several hundred creditors had executed Representation

Agreements (“Agreements”) authorizing Guy & Brock to represent them in the Mid-

Valley bankruptcy proceedings. The Agreements themselves were not filed with the

Court. These creditors were also plaintiffs in a separate, asbestos-related Mississippi

state tort case, McNeil v. Dresser Indus. (“Dresser”). The Mid-Valley debtors were

defendants in Dresser.

       The Chapter 11 plan of reorganization in Mid-Valley was confirmed and approved

in July 2004 and a final decree was entered in November 2005. Meanwhile, Guy &

Brock, on behalf of its clients, initiated claims against Illinois Central in Mississippi state



                                               2
court, alleging injuries due to asbestos exposure at railroad facilities. In this litigation,

hundreds of the plaintiffs represented by Guy & Brock submitted sworn statements in

which they represented that they had disclosed all of their asbestos claims against other

parties. However, 248 of the plaintiffs did not disclose their involvement in Dresser. By

affidavit, Guy & Brock acknowledged the failure to disclose, but averred that the

omission was inadvertent as its clients were unaware of the Dresser claims filed on their

behalf. This affidavit appears to conflict with Guy & Brock’s Verified Statement in the

Mid-Valley bankruptcy proceedings, and as the District Court states, “it follows that Guy

and Brock has been dishonest either to the federal bankruptcy judge in Mid-Valley or to

the Mississippi trial judges in [the] asbestos cases.” Illinois Central believed that this

discrepancy could affect the asbestos plaintiffs’ action against it, and sought to obtain the

Agreements.

       In March 2006, Illinois Central moved to intervene in the previously closed Mid-

Valley matter, arguing that it had common law and statutory rights to access the

Agreements. The Bankruptcy Court denied Illinois Central’s motion on the ground that

the Agreements it sought were not “judicial records” subject to public access. The

District Court affirmed the Bankruptcy Court’s denial of Illinois Central’s motion.

Illinois Central timely appealed.1


       1
        It should be noted that the District Court’s docket lists William S. Guy and
Thomas W. Brock, the name partners of the law firm of Guy & Brock, as appellees in
their individual capacities in this matter.

                                               3
                                               II.

       We have jurisdiction over this case pursuant to 28 U.S.C. §§ 158(d) and 1291.

The District Court’s denial of a motion to intervene, when based solely on an underlying

question of law, is subject to plenary review. See Pansy v. Borough of Stroudsburg, 23

F.3d 772, 777 (3d Cir. 1994).

                                              III.

       As the District Court states, “[i]t is well-settled that there exists, in both criminal

and civil cases, a common law public right of access to judicial proceedings and records.”

In re Cendant Corp., 260 F.3d 183, 192 (3d Cir. 2001). We have defined “judicial

record” as follows:

       The status of a document as a “judicial record,” in turn, depends on whether
       a document has been filed with the court, or otherwise somehow
       incorporated or integrated into a district court’s adjudicatory proceedings.
       While filing clearly establishes such status, a document may still be
       construed as a judicial record, absent filing, if a court interprets or enforces
       the terms of that document, or requires that it be submitted to the court
       under seal.

Id. (internal citations omitted).

       It is not disputed that the Agreements sought by Illinois Central were not filed with

the Bankruptcy Court, nor were they submitted to the Bankruptcy Court under seal. The

District Court reasoned, based on Cendant, that the Agreements could not otherwise be

deemed to have been “incorporated or integrated” into the adjudicatory proceedings

because the terms of those documents had never been “interpret[ed] or enforce[d]” by the



                                               4
Bankruptcy Court, which had never observed or possessed these documents. See id. The

District Court therefore affirmed the Bankruptcy Court’s denial of Illinois Central’s

motion to intervene on the ground that those documents were not judicial records.

       Illinois Central challenges the legal test applied by the District Court, arguing that

Cendant does not explicitly state that “interpretation and enforcement” of terms is the

only means by which an unfiled document can be “incorporated or integrated” into

adjudicatory proceedings. Illinois Central, nevertheless, cites no authority in support of

any other rule of law or for the proposition that Agreements of the type at issue are indeed

judicial records.2 Rather, Illinois Central argues that incorporation or integration occurred

when the Bankruptcy Court confirmed the Mid-Valley reorganization plan based on the

proxy votes cast by Guy & Brock, under authority of the Verification Statement that

attested to its possession of the unfiled Agreements. Yet, again, Illinois Central cites no

authority for the proposition that unfiled Representation Agreements in bankruptcy

proceedings are “incorporated or integrated” into adjudicatory proceedings by virtue of

indirectly serving as the foundation of the balloting and proxy-voting process. The

Agreements at issue were neither filed nor submitted to the Bankruptcy Court, and, in the


       2
        Illinois Central does cite Pansy v. Borough of Stroudsburg, 23 F.3d 772, 783 (3d
Cir. 1994) (stating that “[w]hether a document is a judicial record should turn on the use
the court has made of it rather than on whether it has found its way into the clerk’s file”).
As the District Court correctly noted, however, the rule enunciated in Pansy does not
apply to cases in which “final judgment ha[s] been entered and no possibility of an appeal
remain[s].” 23 F.3d at 783. Such is the case here, where Illinois Central sought to
intervene in the closed Mid-Valley matter.

                                              5
context of a closed case, we decline to extend our holding in Cendant to encompass such

a situation where the documents have not been interpreted or enforced. We therefore find

that the District Court did not err in its determination that the Agreements at issue were

not judicial records.

       Illinois Central also argues that the District Court erred insofar as it affirmed the

Bankruptcy Court’s denial of its motion to intervene to procure the Agreements. Because

it properly limited Illinois Central’s access to “judicial records,” the Bankruptcy Court did

not err in denying Illinois Central’s motion to intervene to obtain documents that are not

judicial records.

                                             IV.

       For the forgoing reasons, we will affirm the order of the District Court.




                                              6
