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UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK

 

MATTHEW BENDER & COMPANY, INC., Plaintiff,

and HYPERLAW, INC., Intervenor-Plaintiff,

 -against-

WEST PUBLISHING COMPANY, Defendant.
.
94 Civ. 0589 (LAP)
1995 U.S. Dist. LEXIS 3280
.
March 16, 1995, FILED

COUNSEL:

For MATTHEW BENDER & COMPANY, INC., plaintiff:
David Blasband, Deutsch Klagsbrun & Blasband, New York, NY.
David Nimmer, Elliot Brown, c/o DEUTSCH KLAGSBRUN &
BLASBAND, att: David Blasband, New York, NY.
Morgan Chu, c/o DEUTSCH KLAGSBRUN & BLASBAND,
Att: David Blasband, New York, NY.

For WEST PUBLISHING CO., defendant:
Beth K. Neelman, Weil, Gotshal & Manges, New York, NY.,
Joseph M. Musilek, WEIL, GOTSHAL & MANGES, New York, NY.
Jeffrey L. Kessler, WEIL, GOTSHAL & MANGES, New York, NY.

For HYPERLAW, INC., intervenor-plaintiff
Paul J. Ruskin and Carl J Hartmann, III, New York, NY

 

MEMORANDUM AND ORDER

In response to Mr. Ruskin's letter of March 8, 1995 (attached hereto), I advise the parties of the following:

As the parties were informed at the initial pretrial conference in this matter, I became acquainted with Steven Haynes, now a West employee, through my husband's acquaintance with him sometime in the mid-1970's. Mr. Haynes and my husband represented opposing parties in a civil action when Mr. Haynes was an associate at the firm of Simpson Thacher & Bartlett in New York. My husband and I were guests in Mr. Haynes' home (on, I believe, a single occasion in the 1970's) when he lived in New York, and he and his wife have been guests in our home twice since the mid-1970's. Since Mr. Haynes moved to Minneapolis eight or so years ago, I (together with my husband) have seen him approximately twice when his business brought him to New York.

At that same initial pretrial conference, counsel for West stated that my husband had represented a party in a litigation where Vance Opperman, now President of West, represented the opposing party and that, at least in Mr. Opperman's view, the litigation had been [*2] "acrimonious".

In light of the detail Of Mr. Ruskin's inquiry, I state that I am acquainted with Stephanie Pollack Singer, a West employee, through her father, the Honorable Milton Pollack of this Court.n1 [1]

Finally, I have never received any gratuity whatsoever from West other than a pocket calendar which, I understand, is also sent to every other federal judge in America. (I do not use the one sent to me.)

Dated: New York, New York
March 15, 1995
Loretta A. Preska, U.S.D.J. [*3]

 

ATTACHMENT I
(Letter to the Court from Paul Ruskin, Esq.)

PAUL J. RUSKIN
ATTORNEY AT LAW
72-08 243rd STREET
DOUGLASTON, NEW YORK 11363
TELEPHONE (718) 631-8834
FACSIMILE (718) 631-6572

March 8, 1995

Federal Express Priority

Honorable Loretta A. Preska
United States District Judge
Southern District of New York
40 Centre Street
New York, NY 10007

Re: Matthew Bender & Company v. West, 94 Civ. 0589 (LAP)

Dear Judge Preska:

On March 6-7, 1995, the Minneapolis Star Tribune published a two-part article discussing the relationship between West and the federal judiciary. It reported that Supreme Court Justices and federal judges received travel, complimentary tickets to events, lodging, meals and other amounts in settings where they also met with West officials socially--in some cases while participating in active cases regarding West.

In addition, West admitted in discovery herein that it has supplied many other complimentary items to federal judges such as books and personalized materials--in some cases at the judges' homes. West has sought to designate the information in the prior paragraph as "confidential -- attorneys eyes only". Any communications between a federal judge and West is, [*4] as a prima facie matter, not confidential.

At the first status conference in this case (before HyperLaw intervened) the Court stated to West and Bender that you had had previous communications with West and Bender regarding your acquaintance with Attorney Steve Haynes of West. We were not provided with that information--and it is not in the court files.

As you may recall, after you granted HyperLaw's motion to intervene, parties and counsel retired to the Court's jury room to discuss discovery matters. Mr. Musilek represented that Mr. Haynes was merely a minor, technical figure at West. He also stated that all of the transcripts and exhibits materials in the West v. Mead case had been burned pursuant to a settlement agreement. Thereafter, Mead Data provided copies of those transcripts and exhibits to HyperLaw. Only then did HyperLaw discover that Mr. Haynes was not a minor technical player, but rather that he had recommended litigation against Lexis to hold up Lexis while West could get into that particular marketplace. Mr. Haynes is also witness in the 12(b)(1) issues raised by West.

Today we called Mr. Musilek regarding disclosure, and we have attached his response. West [*5] has responded by saying that "to the best of West's knowledge" the Court has not received any complimentary materials--but it has not commented on the issue of travel, meals, etc., and suggests we contact you directly. We are certain that West has been unclear in its response in the hope that our inquiry would anger the Court, and we apologize if this is the case. No slight is intended.

HyperLaw respectfully requests the Court to advise: (1) whether, before or during this cause, it has
accepted anything of value (whether "materials", hospitality, or anything else) from West or Haynes; (2) whether there have been any communications to the Court by any other judge or employee of the federal judiciary regarding this case; and (3) whether the Court would supply a more definite statement about the nature and scope of your acquaintance with Mr. Haynes.

.The issue is not what judges have done--it is what West has sought to do. After reading for the first time that Judge Wisdom received a West award in Texas when he was in the process of deciding West's case on which it relies in this action (and that Judge Arnold who wrote the 8th Circuit decision on which West relies so heavily here had [*6] such a high level of a connection to West), HyperLaw is struck by the coincidences here. Since the time when West and Bender had discussed possible litigation in July 1993 (which would occur either here or in Minnesota) two judges from this Circuit, from the same building have received West awards.

Respectfully submitted,

Paul J. Ruskin (PR 1288)

cc: Elliot Brown, Esq.
      Joseph Musilek, Esq.
     Carl J. Hartmann III, Esq.

 

ATTACHMENT II
(Letter from Jospeh Muilek to opposing counsel)

SCHATZ PAQUIN
LOCKRIDGE GRINDAL & HOLSTEIN P.L.L.P.
ATTORNEYS AT LAW
100 WASHINGTON AVENUE SOUTH
MINNEAPOLIS, MINNESOTA 55401

March 8, 1995

VIA FACSIMILE AND U.S. MAIL

Paul J. Ruskin, Esq.
Law Offices of Paul J. Ruskin
72-08 243rd Street
Douglaston, New York 11363
Fax: (718) 631-5572

Elliot Brown, Esq.
Irell & Manella
1800 Avenue of the Stars, Suite 900
Los Angeles, CA 90067-4276
Fax: (310) 203-7199

Re: Matthew Bender and HyperLaw v. West

Dear Paul and Elliot:

I am writing in response to a telephone call this morning from Carl Hartmann. Mr. Hartmann asked me to inform him of "anything West given to Judge Preska." I have checked with West, and to the best of West's knowledge, Judge Preska has received no complimentary materials [*7] from West, i.e., no books, calendars, appointment books or the like. You may, of course, ask Judge Preska directly to confirm this fact.
Sincerely,

SCHATZ PAQUIN LOCKRIDGE
GRINDAL & HOLSTEIN P.L.L.P.

Joseph M. Musilek

cc: Katherine Daniels (by fax: 22-310-8007)
     Carl Hartmann (by fax: 212-5905-1432)

 

ATTACHMENT III

The Cordia Companies
Louis J. Cordia, President & C.E.O.
211 North Union St. #100
Alexandria, VA 22314
(phone) 703/684-4874
(faxes) 703/684-4831, 703/838-1698 & 703/768-2156
Internet E-mail (cordia[at]databank.com)

Cordia and Associates - government & communications consulting
* "WASHINGTON WATCH"
Executive Brief - newsletter & alerts
.
* Washington Executive Bank - nationwide network of 50,000+ issue experts & working groups *
.
WASHINGTON WATCH ALERT
.
To: Friends
From: Lou Cordia
Date: March 8, 1995
Re: Another Bad Big Government Idea
.
The Minnesota STAR TRIBUNE this week unleashed an unfair attack on the Justices of the Supreme Court and other federal judges. The story appeared through Reuters and AP in the WASHINGTON POST and WASHINGTON TIMES (see attached).
.I want you to know that the STAR [*8] TRIBUNE's attack against Supreme Court Justices and other members of the judiciary is only a ploy. Their fight is really against West Publishing, my client, as a part of an intensifying battle raging in the on-line information service sector. The attacks began last October when the STAR TRIBUNE supported the Clinton Administration's proposal to replace West and other private legal publishers with a government-run, on-line legal database. Accusing West of "bullying" tactics, the STAR TRIBUNE said "if West were smart, it would suspend its paranoid attacks on the Justice Department..." Curiously, the most recent STAR TRIBUNE attacks come soon after the STAR TRIBUNE signed an agreement with AT&T to create an on-line business news and information service which will compete directly with West's industry-leading business information products.

By attacking the integrity of the Supreme Court and the honorable men and women who serve there, the STAR TRIBUNE attempts to elevate what has been essentially a policy and business disagreement between West and a small group of other publishers. But Justice Scalia put their sensationalism into its proper perspective when he opined that merely serving, [*9] at West's request, on an awards committee - which selects an outstanding federal judge - does not disqualify a judge from dealing with matters involving West.

.The fundamental policy disagreement that West Publishing has with the STAR TRIBUNE and the group of competitors is over the role of government. They want the government to get into the legal publishing business--a business West has provided to the legal community for over 100 years. Obviously, we don't want government to offer "free services" currently available in an ever-competitive private sector legal publishing industry; for example, from 1992 to 1994, there was a 250% increase in case report publishers from 65 competing publishers producing 190 publications in 1992 to 175 publishers producing 700 different case law sources. Still, the proponents of the Clinton Administration's plan would expropriate and de facto "nationalize" West's enormous investment in the American legal system: its excellent system of organizing, summarizing, indexing and cross-referencing the thousands of case opinions decided by the federal courts. The West-created system is widely-recognized as the finest in the world. Now this liberal [*10] Minnesota newspaper, a small group of competitors organized by one of Ralph Nader's "public interest" groups - the Taxpayer Assets Project, and the Clinton Administration are working together to encourage the government in Washington and in a few State Capitals to create a whole new government system. As I read the November elections, the people voted for less government, not more.

.West has always believed that every American should have unlimited access to government information. However, private sector legal publishers like West don't merely re-publish raw, unedited government data. They add value to the information by editing it, organizing it, and creating an information product that is extremely useful and accessible--and thus valuable. West's capital investments, labor and entrepreneurial efforts should not be cast aside in favor of a special interest group of competitors. West welcomes competitors' investing their own money, not the taxpayers', to get into any aspect of the legal publishing business. The bottom line is the government should be prevented from expropriating West's work product or attempting to duplicate it at taxpayer expense.

.Enclosures [*11] (6 pages)

ATTACHMENT IV
.
West Publishing Corporation
620 Opperman Drive
P.O. Box 64779
St. Paul, MN 55164-0779
612/687-4099
Fax: 612/687-5388
.
RUTH E. STANOCH
Manager, Government Relations and Media Relations
.
March 6, 1995
.
Dear Friend:

You may be aware of an attack on the Supreme Court published in the Minnesota Star Tribune on March 5, 1995. West Publishing Corporation takes great offense to this attack on the Court's integrity.

Enclosed is a copy of West's response to the article. If you have any questions, please don't hesitate to call.

Sincerely,

Ruth E. Stanoch
Enclosure

West Publishing Corporation
620 Opperman Drive
P.O. Box 64779
St. Paul, MN 55164-0779
(612)687-8000
.
March 5, 1995

Statement of West Publishing Corporation
Press Inquiries: Ruth Stanoch
1-800-778-8090 ext. 74015

Star Tribune Attack on Court is Tabloid-style Journalism
The article published today by the Star Tribune attacking the Supreme Court and West Publishing is just plain wrong. It has about as much truth as the alien stories headlined in the supermarket tabloids.

Those who know West recognize that the company's success [*12] in the legal market has been won fair and square by thousands of hardworking employees for 120 years -- superior research and superior products.

Article's Conclusions: West Acted Legally, Ethically  . Consider what the Star Tribune did. In more than five full pages of reporting, the Star Tribune reaches  three conclusions:  . First, West's activities to promote understanding of the law and to recognize distinguished jurists are legal  and ethical. The Star Tribune states flatly: "West broke no laws in making the gifts." Further, says the  newspaper, "The award complies with all laws and ethics codes..."

The Star Tribune's principal expert,  legal ethicist Stephen Gillers, adds his endorsement: "It is perfectly legitimate for a law book publisher to  sponsor such an award--I've nominated someone myself--and to enlist the aid of judges in selecting the  recipients and to pay their reasonable expenses in fulfilling that selection obligation."  . Second, according to the Star Tribune's exhaustive research, the recipients of the Devitt Award are  outstanding jurists, selected solely on the basis of merit. The Star Tribune praises the Devitt Award  winners. For example, it notes [*13] "There is little argument that (Fifth Circuit Court Judge John Minor  Wisdom) is worthy of the highest honors."  .

Finally, there is no link between the Devitt Award and court cases involving West.  . Without regard for the integrity of the judiciary and the reputations of distinguished public servants, the  Star Tribune cynically exploits public mistrust of government with tactics that are reprehensible. The  newspaper engages in tabloid journalism of the worst order. In particular, West resents the innuendo that  court cases involving the company may have been decided on something other than merit. The article  teases readers with questions of impropriety, but can't deliver the pay-off in spite of devoting five full  pages to the issue.  . Yet, these conclusions are lost to all but the most careful readers.

The Star Tribune hopes that most  readers will be swayed by tabloid-style headlines and innuendo.  . Devitt Award, Selection Process Fully Disclosed  . In the process, the Star Tribune has cast a cloud of doubt and distrust over one of the most trusted  institutions in our American governmental structure, the United States Supreme Court. It is particularly  distressing [*14] that to make this attack on the Court the newspaper has used an award that was created  by West Publishing to honor the selfless, dedicated lifetime service of some of the most distinguished  public servants of the U.S. federal courts.  . West is proud of its sponsorship of the Devitt Award. We take great pains to maintain its integrity and  independence. West, as pointed out by the Star Tribune, has no influence over the nomination or selection  of the honored jurists.

The Award program always has been conducted and administered in the open, with  the process and results fully disclosed.  . The Star Tribune's inference is ludicrous. They have taken an act of good corporate philanthropy in which  the best regarded jurists in the country recognize the achievements of their fellow judges and used it as an  attack on West and the courts.  . Star Tribune Hides Business Interests  . The question that needs to be asked is why the Star Tribune is publishing this article now, 13 years after  the start of the Devitt Award. The Award has been prominently announced in news releases, including  those published by the Star Tribune.  . The article follows the Star Tribune's recent announcement [*15] that it will begin an online information  service that will directly compete with West.

This potential conflict of interest was raised by West with the  Star Tribune, but is conspicuously absent in five full pages of reporting. We believe the Star Tribune has  an obligation to its readers to fully disclose the business advantage it stands to gain by diminishing the  reputation and good standing of West.  . West Asks for Disclosure, News Council Review  . The standards of justice and fairness demand that the Star Tribune be called to account for its willingness  to deliberately trash the honesty, integrity and character of this nation's highest court and one of this  state's oldest and most trusthworty corporate citizens. They must also be made to answer for journalistic  ethics that are beneath contempt. To that end, we will tomorrow forward a letter by courier to the  Minnesota News Council highlighting the Star Tribune's repeated unwillingness to divulge to their  readers that it is now in an online information services business in direct competition with West. This is  vital information that even the most casual ethical observer would say goes to the heart of the newspaper's  motive [*16] in pursuing this story in the first place.  .

ATTACHMENT V

The Washington Times Date: 03/07/95 Page: A9 

NATION  Publishing firm goes on offensive  Accuses paper in judges' trips story  .

By Chris Ison 

MINNEAPOLIS-ST. PAUL STAR TRIBUNE  . West Publishing Co. has accused the Minneapolis Star Tribune of using reprehensible tactics and  engaging in "tabloid journalism of the worst kind."  . The charge came at a news conference during the weekend in response to stories in the Star Tribune about  West Publishing's practice of giving luxurious trips to U.S. Supreme Court justices and federal judges who  made decisions important to West.

A West spokeswoman said the Star Tribune report was "just plain  wrong," though she refused to cite inaccuracies.  . Ruth Stanoch, West's manager of government and media relations, charged that the newspaper failed to  disclose its own conflict of interest. Miss Stanoch said the Star Tribune plans to launch an on-line  computer news service and "stands to gain by diminishing the reputation and the good standing of West."  .
West is planning an on-line service to cover news relating to legal affairs.  . The Star Tribune's editor, Tim [*17] McGuire, called Miss Stanoch's statement a "red herring." He said  the newspaper doesn't see West's on-line service as a competitor, adding that Star Tribune reporters were  working on the story long before West announced plans to go on line.  . "I find this attack public relations," said Mr. McGuire. "We made it very clear to West we are not going to  be in competition with them. ... We are not going to become a legal service."  . The Star Tribune reported Sunday that seven justices and other federal judges accepted trips to expensive  resorts and hotels for which West paid. The jurists took the trips while serving on a committee to select  the winners of the Edward J. Devitt Distinguished Service to Justice Award, a $ 15,000 West-sponsored  prize given each year to a federal judge for outstanding judicial service.  . The trips occurred over a 13-year period in which the justices and judges were in a position to consider  lawsuits involving West and make policy decisions regarding court business with the company.  .
Miss Stanoch said the Star Tribune acted "without regard for the integrity of the judiciary and the  reputations of distinguished public servants," and said the report "cynically exploits [*18] public mistrust  of government."  . .
Distributed by Scripps Howard.  .

ATTACHMENT VI

The Washington Post Date:

03/06 95 Page: A7 
Justices, Judges took Favors  From Publisher With Pending Cases  .

Reuter  .

MINNEAPOLIS, March 5--

U.S. Supreme Court justices and federal judges nationwide acted on cases  involving a publishing firm that gave the jurists lavish trips and gifts, the Minneapolis Star Tribune  reported today.  . The newspaper said the judges who accepted luxury travel arrangements and other gifts from West  Publishing Co. of Eagan, Minn., broke no laws, but some ethics experts contacted by the newspaper said  the judges 'should have excused themselves or at a minimum disclosed their contacts with the company to  all parties.'  .

The paper said West denied having done anything illegal or unethical and said it followed all rules  covering contacts with public officials.  . In a statement, the company said the "article follows the Star Tribune's recent announcement that it will  begin an online information service that will directly compete with West."  . According to the Star Tribune, at least seven Supreme Court justices (sitting Justices Sandra Day  O'Connor, John [*19] Paul Stevens, Antonin Scalia and Anthony M. Kennedy and retired Justices Lewis  F. Powell Jr., Byron R. White and William J. Brennan Jr.) and a number of federal judges took trips at  West Publishing's expense.  . The trips were part of the process to pick the winner of the annual Edward J. Devitt Distinguished Service  to Justice Award, a $ 15,000 prize established by West Publishing in 1982 and awarded to an outstanding  federal judge.  .

The excursions were often to luxurious resorts and entailed little actual work. Some award selection  committee members involved themselves in planning the trips, the paper said.  . For example, Powell, who served on the Supreme Court until 1987, suggested in 1984--in a letter obtained  by the Star Tribune--that if the meeting could not be held in Hawaii the group might meet in "the  Breakers Hotel in Palm Beach--on the water, superior facilities, and affording many interesting things to  do and places to see--particularly for our ladies."  . Another time Powell wrote: "As to where the next meeting of your Committee is held, Caneel Bay is a  place my wife Jo and I always have hoped to visit."

According to the article, within weeks, West began to  arrange for a meeting [*20] at the U.S. Virgin Islands resort, where today double-occupancy rooms range  up to $ 615 a night.  . These trips and other gifts, such as law books and entertainment at legal conferences, were given by West  Publishing while the company was defending its business in courts nationwide, with some cases reaching  the Supreme Court.  . West has been publishing the decisions of local courts and the Supreme Court since the turn of the  century. Its specialty is organizing the material in such a way that lawyers and judges can easily find  decisions and court opinions.  . West publishes about 60 million books and pamphlets each year.

The company claims that it is entitled to  copyright protection of its organizing and numbering system and has been aggressively defending its  position in courts nationwide.  . Since 1985, two individuals, the state of Texas and electronic law information provider LEXIS-NEXIS  (owned by Ohio-based Mead Data Central Inc.) have sued West Publishing trying to break the company's  claim of copyright. These cases were decided in West's favor and the decisions were upheld on appeal and  allowed to stand by the Supreme Court.  . The newspaper said that Judge John Minor Wisdom of Texas [*21] accepted the Devitt award in May  1989, after hearing the arguments in the Texas case on December 6, 1988, but before the appeals panels of  which he was a member issued its opinion (in September 1989) supporting West Publishing's position.  .

U.S. justices took trips from West Publishing  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]  .

Ethicists question the conduct of justices  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]  .

A profile of West Publishing  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]  .

Texas ruling favored West after judge received prize  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]  .

Rules and guidelines governing judicial behavior  . Judicial Code of Conduct  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]

Devitt Award is prestigious - and unusual  . Close involvement of corporate sponsor sets it apart  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]  .

West and the Supreme Court  . Members accepted gifts and perks while acting on appeals worth millions to Minnesota firm  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]  .

West's response to questions asked by the paper [*22]  . [SEE ARTICLE IN ORIGINAL Star Tribune March 5, 1995]  . Star Tribune  . NEWSPAPER OF THE TWIN CITIES  . MONDAY/March 6 1995  .

High stakes and hot competition  . In face of change, West Publishing fights to maintain its lead in legal publishing  . [SEE ARTICLE IN ORIGINAL Star Tribune March 6, 1995]  .

West's battlefield has many fronts  . [SEE ARTICLE IN ORIGINAL Star Tribune March 6, 1995]  .

New technology is changing the competition  . [SEE ARTICLE IN ORIGINAL Star Tribune March 6, 1995]  .

West defends actions, cites list of accomplishments  . [SEE ARTICLE IN ORIGINAL Star Tribune March 6, 1995]  .

A case study  . Judge Gerald Tjoflat  . Chief of the 11th Circuit Court of Appeals  . [SEE ARTICLE IN ORIGINAL Star Tribune March 6, 1995]  .

Reforms suggested in practice of taking gifts  . Disclosure among recommended changes  [SEE ARTICLE IN ORIGINAL Star Tribune March 6, 1995]  .

Debate rages over who owns the law  . Tens of million of dollars are riding on the outcome  . [SEE ARTICLE IN ORIGINAL Star Tribune March 6, 1995]  .
West calls stories 'tabloid journalism'  . [SEE ARTICLE IN ORIGINAL Star Tribune March [*23] 6, 1995]

xxx

 

 

 

See Letter from HyperLaw Lawyer below stating reasons HyperLaw requested recusal.

 

Subsequently, HyperLaw filed a Writ of Mandamus to the Second Circuit. This was denied, but Judge Preska nonetheless recused herself.

 

Matthew Bender did not participate in the request for recusal, but, later, did state this its August 5, 1996 motion for summary judgment.

 

"West refused to provide more specific information, and objected to Bender's interrogatory "on the grounds that it seeks information not reasonably calculated to lead to the discovery of admissible evidence, and on the ground that the information sought by the interrogatory is extremely confidential." West Publishing Company's Amended & Supplemental Responses to Matthew Bender's Fourth Set of Interrogatories at 2 (emphasis added) [Ex. 27]. Judge Preska sustained West's objections in the face of Matthew Bender's application to compel West to respond. See id. at 2 (referring to Judge Preska's oral order). "