Magazine article Editor & Publisher

Judge Orders Files Unsealed

Magazine article Editor & Publisher

Judge Orders Files Unsealed

Article excerpt

THE MEDIA WON a major court battle when a California judge ordered the unsealing of briefs of grand jury testimony from the 1994 Orange County bankruptcy, which caused $1.64 billion in losses to cities, schools and county agencies. It was the largest municipal bankruptcy in the nation's history.

Superior Court Judge David O. Carter in Santa Ana unsealed four briefs filed by attorneys seeking to keep secret testimony by Merrill Lynch & Co. employees, who claimed prosecutors promised them confidentiality.

Media and county civil attorneys contend that the district attorney's $30 million settlement with Merrill Lynch scuttled chances for grand jury indictments against the brokerage firm, one of the county's financial advisers before the crash.

However, Carter's decision was in abeyance as Merrill Lynch attorneys filed an appeal in mid-August. Meanwhile, District Attorney Michael Capizzi held the released transcripts pending the outcome of the appeal.

Initially, Capizzi, a Republican candidate for state attorney general next year, said he favored making the grand jury transcripts public but has since switched his stance, arguing that the records should never be made public. He is supported by California Attorney General Dan Lungren.

Capizzi asserted at a press conference that the settlement benefited the county because it eliminated the need for a long and costly criminal trial that would probably result in only a fine, anyway. The county"s $2 billion civil suit against Merrill Lynch was not affected by the settlement with Capizzi.

The media initiative to make the documents public was led by the Los Angeles Daily Journal, a legal affairs newspaper, and was joined by the Associated Press, Long Beach Press-Telegram, Wall Street Journal, Los Angeles Times, Bloomberg News, Society of Professional Journalists, Orange County Press Club, Orange County Register, and the California First Amendment Coalition. …

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