Pennsylvania National Mutual Casualty Insurance Group v. New England Reinsurance Corporation; Hartford Fire Insurance Company (Everest Reinsurance Company – intervenor in District Court)
Issue Discussed: Confidentiality
Submitted by Polly Schiavone
Date Promulgated: December 11, 2020
Case: Pennsylvania National Mutual Casualty Insurance Group v. New England Reinsurance Corporation; Hartford Fire Insurance Company (Everest Reinsurance Company – intervenor in District Court), US Court of Appeals, 3rd Circuit, Nos. 20-1635 and 20-1872.
Issue Discussed: Confidentiality
Court: United States Court of Appeals for the Third Circuit
Date Decided: December 11, 2020
Issue Decided: Whether an arbitration award filed with a Court as an exhibit to a motion should be unsealed per the common-law right of access
Submitted By: Polly Schiavone, Vice President, Swiss Reinsurance America Holding Corp.
Pennsylvania National Mutual Casualty Insurance Company (“Penn National”) arbitrated a matter with two of its reinsurers. The issue in the arbitration was whether Penn National was entitled to proceeds from those reinsurers. The arbitration panel issued a decision/award (hereinafter the “Award”) in favor of Penn National. Penn National petitioned the District Court to confirm the Award, reduce it to judgment and seal it.
Shortly thereafter, the parties settled and Penn National withdrew its petition to confirm.
Everest Reinsurance Corp. (“Everest”), another of Penn National’s reinsurers (not a party to the subject arbitration) moved to intervene and unseal the Award under the common-law right of access. The District Court granted Everest’s motion but stayed its order pending appeal.
For the common-law right of access to apply: 1.) a given document must be classified as a “judicial record” and 2.) access to the document cannot create an injury that outweighs the presumption of access.
Penn National argued that, whether or not the Award is a judicial record depends on the use the Court has made of it rather than on simply whether it has found it’s way into the clerk’s file. Penn National cited several cases that analyze the categorization of “judicial records.” But this Court distinguished each case, rejected Penn National’s argument, and found that the Award became a judicial record subject to the common-law right of access when Penn National filed it as part of its motion to confirm.
Next Penn National argued that the District Court erred in holding that it failed to demonstrate specific harm sufficient to overcome the presumption of public access. In support of its argument, Penn National submitted an affidavit from one of its officers stating that other reinsurers might forego paying Penn National if they learned of the Award. The Court rejected this argument affirming the lower Court’s finding that no “clearly defined” injury existed and that Penn National’s assertion was simply too speculative.
The Appellate Court affirmed the judgment of the District Court and unsealed the Award. This decision is considered “Not Precedential.”
