Commentary

Bill Cosby’s Testimony Released: Why That Could Be Bad for Businesses

By Randal John Meyer
This article appeared on Forbes on July 7, 2015.

Can you sell your silence? That is, if you know a valuable secret, one that could even hurt other people by keeping it, should you be able to sell your silence on the matter? This question has been a source of difficulty for lawyers and judges, and was at the heart of bringing to light the sexual abuses of former comedian Bill Cosby. On a more day-to-day basis, though, the same rule at issue in Bill Cosby’s case has noteworthy implications for business interests.

The particulars for this case are very similar to other Cosby accusations: Andrea Constand “was visiting Cosby’s Main Line mansion in early 2004 when he gave her pills.” “After consuming the pills, she said, she felt hazy but remembered Cosby touching her breasts and genitals.” Andrea sued in 2005, and in 2006, “[d]etails were not disclosed,” but the case was dismissed.

What happened was that a settlement was reached between the parties. A court settlement is not a court edict; it is a contract between two parties and in many cases the court seals it or related filings. In Bill Cosby’s case, as in many similar settlements, the parties agree to silence. That is why the AP had to go to “court to compel the release of a deposition in a sexual-abuse case filed by former Temple University employee Andrea Constand…”

In responding to the AP, “Cosby’s lawyers had objected to the release of the material, arguing it would embarrass him,” which it did. “Ultimately, a judge unsealed just a small portion of the deposition.” The judge in the original suit, U.S. District Judge Eduardo Robreno, did not decide whether “the temporary seal on some filings should be made permanent before the case settled in 2006.” Absent such a decision, under the local default rules, “Cosby has the burden to show why seals should not be lifted after two years, the AP argued.”

Where this can be bad for businesses is when you replace “Bill Cosby” with “Corporation X” and “sexual assault allegations” with “product liability allegations.” Allowing courts to unseal records that parties paid to have a reasonable expectation of being sealed impairs the value of such a contract and risks unduly prejudicing a product, such as medicine, for early latent design flaws. Indeed, Cosby’s attorney “argued that Cosby might not have forged the confidential settlement if he thought his deposition testimony and other motions would someday get out.”

Largely, what controls in these sorts of cases is the public interest in the contract for silence being upheld by the court. Indeed, as Judge Robreno wrote regarding Mr. Cosby’s case: “The stark contrast between Bill Cosby, the public moralist and Bill Cosby, the subject of serious allegations concerning improper (and perhaps criminal) conduct is a matter as to which the AP — and by extension the public — has a significant interest.”

This is not to say the Court was wrong in unsealing the records in Cosby’s case—the facts there present a clear public interest in keeping people safe from a dangerous predator, as the judge properly recognized. Businesses, however, with a different set of interests than sexual predators, could be more inclined to litigate cases where they might have otherwise settled in order to avoid being embarrassed by imprudent testimony in the future.

Randal John Meyer is a legal associate at the Cato Institute.