Tuesday, June 21, 2016

Why do small colleges fail? And why should we care?

Here's an interesting essay in the Chronicle of Higher Education that attacks that question.

The piece notes that there are some 1600 private, not-for-profit colleges and universities in the US of which a remarkable 30% enroll fewer than 1000 students.

One might reasonably ask if America needs these tiny schools at all.  After all, there are thousands of other options from the great land-grant public university systems to the community colleges the Obama administration is so fond of.

One might even ask why we need private higher education --- costly as it is --- at all.

I had some thoughts on this question a decade ago, which I believe are worth repeating now:

      The December 8, 2000, issue of The Chronicle of Higher Education reported that an article in the Denver Journal of International Law and Policy, in which the authors had criticized the alleged behavior of Boise Cascade Corporation toward workers in its Mexican facilities, was withdrawn by the University of Denver after the corporation threatened a disparagement and defamation lawsuit.
      The report is reminiscent of earlier articles in The Chronicle and elsewhere concerning "slap suits" against academics whose scholarship is critical of corporate interests, and other forms of corporate retaliation against universities that have taken stands against selling sweatshop goods. As the University of Denver's acquiescence suggests, higher education's response to such corporate challenges to age-old principles of academic freedom and social justice has been uneven at best.
     The 21st century is no time tot faint-heartedness in higher education. Rather, this should be a time when we champion free speech and social justice, even at the risk of our own prosperity. No one else can do it.
      In 1967, John Kenneth Galbraith, in The New Industrial State, postulated a three-legged stool on which the well-being of American society rested: Big Business, Big Government, and Big Labor. These legs kept one another in check, a sort of socio-political supplementation to the political checks and balances outlined in the Constitution. Galbraith's thesis was correct in its fundamental features. But by the 1990s, Robert Reich--in many ways Galbraith's intellectual successor at Harvard--would express his concern in The Work of Nations about the failure of that balance, due to the shift from a manufacturing to a services economy and the decline of organized labor.
        When Galbraith was writing, in the 1950s and 1960s, labor represented one in three American workers, and a typical American CEO took home 40 times the salary of the worker on the shop floor--a sum that, when reduced by our steeply graduated income tax, amounted to only 12 times the worker's wages. By 1988, the number of unionized workers in the private sector had fallen to one in 10, and CEOs were enjoying 70 times more after-tax income than average workers.
        In this brave new world, Reich concluded, the information manipulators--in his terms the "symbolic analysts"--are the dominant subspecies. Indeed, this is true even within the labor movement: The most prominent private-sector unions in America are those representing professional athletes and entertainers. Whatever happened to Cezar Chavez? Today's big name on the border is NAFTA.
       Let me suggest that higher education should aim at filling the vacuum left by Big Labor in Galbraith's construct of The New Industrial State. Its capacity to serve as a countervailing force will rest on one or more of the following features of the contemporary university:
• Vastly increasing endowments, as we see developing at the Ivies and universities of analogous high quality and prestige;
• Expanding geographic reach via multiple campuses--for example, Penn State's 1997 upgrade of 14 of its regional campuses from two- to four-year colleges;
• Direct competition with the for-profits, such as the University of Phoenix, in the distance-education market, which is being more or less successfully attempted by some large universities and systems; and
• Consortia of small colleges, and/or small-college affiliations with a larger (possibly "hub") institutions, a strategy being pursued, for instance, by a group of small Catholic colleges in eastern Pennsylvania.
     This suggestion and list of features, of course, conjure memories of the critique of the "megaversity" that emerged from such works as C. Wright Mills's The Power Elite. Admittedly, "mega" is a part of what higher education must be if it is to be a co-equal member of the triumvirate upon which 21st-century American society will rest. The small, independent college will not be able to play this role except where it is unusually well endowed or affiliated with a major religion or consortium.
     If higher education is to perform the crucial task I have proposed for it in 21st-century America, it must take a page from the history of organized labor in the unions' heyday. Like Big Labor at its zenith, higher education needs to become adept at shifting from the right foot of collaboration with Big Business and Big Government to the left foot of confrontation. It must do this even at the price of lost corporate and government support, and even in the teeth of threatened litigation, when the issue is academic freedom or social justice.
      Indeed, many public university systems are striving to build their alumni support and endowments so as to gain a measure of independence from the strings attached to government purses. And many church-affiliated institutions, especially Catholic universities, are returning to their religious roots and for the first time in a long while are publicly celebrating--even marketing--their moral and doctrinal orientations.
What of the prospects of success for higher education in the sometimes-confrontational posture I am proposing? In his sweeping survey in Millennium: A History of the Last Thousand Years, Felipe Fernandez-Armesto says that the monasteries that survived the Dark Ages triumphed only by being needed. They also survived by being distinct from government and the marketplace. The more that colleges and universities morph to match their for-profit competition, the more they incapacitate themselves to act as a counterweight to those other powerful forces.
        In a recent article in The Chronicle of Higher Education, Columbia's Arthur Levine listed nine "inevitable changes" that colleges and universities experience in the coming decades, such as competing with "more numerous and diverse" providers of higher education. But the more readily they accept Levine's nine changes as "inevitable" and collaborate in their coming about without carefully considering the merit of each--followed by a conscious decision to accept or oppose it--the less they will be able to function as free agents influencing American society.
      As David Halberstam observed in The Next Century, America is more than ever an "entertainment-driven society." A felling example is the contrast between the media coverage of the Vietnam War and the coverage of the Gulf War some two decades later. Stanley Karnow wrote of the 1968 Tet offensive, "After years of viewing the war on television, Americans at home had become accustomed to a familiar pattern of images....The screen often portrayed human agony in scenes of the wounded and dying on both sides....[M]ostly it transmitted the grueling reality of the struggle...punctuated periodically by moments of horror."
       By contrast, the Gulf War was quick, high-tech, and portrayed on American television as if it were a video game. Satellite photos were combined with simulations to feed American viewers sanitized images, depicting no more real blood and pain than a quick game of "Space Invaders."
      Thus, barbarism passed beyond the merely banal to the visually alluring. The film industry has responded to, and in turn reinforced, its audience's fascination with the visually unusual and compelling. From George Lucas's breakthrough Star Wars films of the 1970s and 1980s to The Perfect Storm last year, special effects--and, increasingly, computer-generated visuals--are at the heart of most blockbuster hits. If it can be imagined, it can be depicted.
      This power is potentially hazardous. Severo Ornstein, writing in the journal Computer Professionals for Social Responsibility, points out, "Today the art of simulation has developed to the point that it has become necessary to identify television simulations as artificial, so we won't think we are seeing the real thing....When employed for political purposes, illusion becomes diabolical and deception becomes downright dangerous."
If higher education must differentiate itself from business and government in order to serve as a counterweight to them, one of the fundamental ways it must do so is in adhering to a strict code of truth-seeking and truth-telling. Even if particular institutions of higher learning are unwilling to take unpopular stands on controversial issues, they must share consensus on this code or run the risk of abrogating their claims to being genuine educational institutions. Are we not entitled to expect a higher level of integrity from our universities than we anticipate when we turn on our TVs?
       This expectation of integrity means that when universities use the power of technology to lie as governments and businesses do, it seems more scandalous. Witness the University of Wisconsin's embarrassment when it was "exposed" in a Chronicle article on Nov. 24, 2000:
       The cover of its new admissions brochure displayed a photograph of happy U.W. students attending a football game at their home stadium--a photograph that turned out to have been doctored. The original picture contained no black faces, but U.W. officials had desperately wanted their admissions materials to reflect a diverse student body. So, using photo-design software, the director of university publications and the director of undergraduate admissions simply asked their staff to add one.
      Coming now full circle, let us consider in greater depth the University of Denver's decision to withdraw an article previously published in one of its law reviews, when faced with a major corporation's threat to sue. Let us begin by agreeing, if we can, that the remedy for bad speech is more speech. And let us assume--purely for argument's sake--that the censored article is inaccurate, or even that it is defamatory. What ought the university to have done, or offered to do, in the face of Boise Cascade's threatened legal action? Let us compare what it did do to what Cornell University did when faced with a similar situation.
       In 1998, Professor Kate L. Bronfenbrenner of Cornell's School of Industrial Relations was sued by Beverly Enterprises, Inc., one of the nation's largest nursing home chains. Beverly accused the professor of lying about the company's labor relations record to members of Congress and in her published scholarship. Bronfenbrenner reportedly told Democratic Congressmen at a town hall meeting that Beverly had a "long-established record of egregious labor-law violations in the context of union-organizing campaigns."          The corporation sued her for defamation. Cornell hired attorneys and successfully defended the suit on its faculty member's behalf.
       In the wake of Beverly Enterprises, Inc. vs. Bronfenbrenner, faculty around the country were understandably concerned that "slap suits" would become more common. At Rider University, the American Association of University Professors (AAUP) came to the negotiating table in summer 1999 with a proposal aimed at ensuring that the university would defend any faculty member who was named in any such "slap suit." The university, to its credit, agreed to a new provision in the collective bargaining agreement that will provide such protection, and then obtained the appropriate insurance to cover any such claims.
      In short, my contention--which I hope is shared by the great majority of my readers--is that a university must do at a minimum two things to think of itself as a real university: seek the truth and defend those who try to tell the truth under the institution's auspices.       Absent a strict adherence to these two baseline principles, an institution ceases to be a university, no matter how many sports teams it fields, how many academic programs it offers, or how many campus amenities its students enjoy. The institution may be an information purveyor or a training school or a research center, but it has forfeited the right to call itself a university.
       Now comes the hard part, where I expect that many of my readers and I will part company. For I argue that the two baseline principles outlined above are only that: credentials that qualify an institution to call itself a university. But while a labor union must fairly and vigorously represent its members, a great union will also put its resources at risk in order to organize unrepresented workers. A great university likewise will reach out and actively oppose injustice.
       This is not the view of most universities today. Just as many unions have long since circled their wagons, emphasizing preservation of existing power bases over the organization of new constituencies, so too have many--perhaps most--universities taken the path of cautious conservatism. Father Theodore M. Hesburgh, former president of Notre Dame University, wrote in the February 2 issue of The Chronicle,
       When I was a college president, I often spoke out on national issues, even when they didn't pertain to academic life. Yet nowadays, I don't find many college presidents commenting on such issues on the front page of The New York Times or in any of the country's other major news outlets. Once upon a time chief executives in higher education talked to the press about military policy in the same breath as the Constitutional amendment for the 18-year-olds' vote, but I wonder whether we hear them taking stands on similar topics now.
      Father Hesburgh cites a recent American Council on Education (ACE) report, which concluded, "[T]he vast majority of Americans rarely hear college presidents comment on issues of national importance, and when they do, they believe institutional needs rather than those of the students or the wider community drive such comments." He offers several reasons why this has happened. Among them is "that presidents must play an ever-larger role in raising money for their institutions--and often from supporters who have strong views on what presidents should or shouldn't say to the press."
       Today colleges feel free to draw their CEOs from the ranks of development officers, a practice that to my knowledge was almost unheard of even two decades ago. In current searches for college presidents, it seems that the absence of the initials "PhD" after the candidate's name is not necessarily an impediment if the fund-raising record is substantial.
        Our students, too, have for the most part been quiet since the tumultuous late 1960s and early 1970s. The 1980s witnessed a rush to law and business schools for JDs and MBAs, then on to the M&A (merger and acquisition) practices of the nation's big accounting, law, and investment banking firms. During the latter half of the 1990s, undergraduates couldn't wait--and sometimes didn't--to establish their own dot-com business ventures.
        But as the last decade of the last century of the old millennium came to a close, there were stirrings in at least some of our student bodies. Students at universities across the country became energized--at least temporarily--by the anti-sweatshop movement. Initial corporate responses to these new stirrings of student unrest included withdrawals of sports sponsorships. But these punitive reactions were rapidly replaced by the formation of the Fair Labor Association, an anti-sweatshop consortium consisting of such major manufacturers as Nike and Reebok and some 140 institutions of higher learning.
       The Fair Labor Association may be compared by critics to the company unions that proliferated in the early part of the 20th century, before they were outlawed by the 1936 passage of the National Labor Relations Act. The Worker Rights Consortium, a more militant anti-sweatshop organization, operates independently, and--perhaps not surprisingly--has come under fire from corporate members of the Fair Labor Association. Said a Nike spokesman of the consortium recently, "It's just parachuting into a country, conducting a few interviews, and writing a report in a few days. Thorough monitoring involves culling through records, matching up pay stubs, getting a sense of the local practices and culture. There is a lot more involved in auditing and monitoring than what that report represents."
       The important point for my purposes here is not whether the Fair Labor Association or the Worker Rights Consortium has got it right about any particular allegation of sweatshop abuses. What matters here is that the two groups appear to be engaged in dialogue and debate about the truth behind such labor-abuse accusations. This is precisely the sort of conversation that is denied to higher education's constituencies when a corporation threatens to sue or to withdraw sponsorship and the targeted institution bows to the threat.
Slowly but surely, however, at least some of America's several thousand institutions of higher education are manifesting a willingness to use their virtual global reach to identify and help address the inequities that proliferate beyond their campus boundaries.
       The record to date suggests that such initiatives are not nearly as risky as some may fear. Just as American companies in the 1940s and 1950s reached accommodations with organized labor because they needed the workers represented by those unions, so too does the quick creation of the Fair Labor Association suggest a recognition among apparel manufacturers like Nike and Reebok that they need big-time college athletics. By extension, corporations need our graduates, our scientists, our consultants--in short, our knowledge. Knowledge is capital. As such, it affords us leverage.
      Does higher education possess the collective will to exercise that leverage? I do not know. But let me suggest that many big issues of our times cry out for us to demonstrate that will. Father Hesburgh points to affirmative action and "developing education programs that seek to improve the status of women--especially in Asia, South America, and Africa, where many are second-class citizens"--as issues he would address, were he still a university CEO. Women's rights, affirmative action, and the anti-sweatshop movement can all be characterized as battles in a global struggle to end the exploitation of human beings. Environmentalism, community outreach, and health research are related issues on which higher education could also speak out.
        A key question in my view is, How will higher education use its global reach and knowledge capital, particularly as those have been enhanced by communication technology, in the 21st century?
To date, the discourse has been a self-referential one, centered on the displacement of traditional classroom teaching by distance learning. To borrow the words of the ACE report, it has focused on "institutional needs rather than those of...the wider community." Much less discussed is the potential for the Internet to make American higher education a force for fair play and human dignity in the international arena. Global reach brings with it global responsibilities. Knowledge is not only capital--it is power. Whether that power will be focused upon the narrow concerns of individual institutions or combined for the good of "the wider community" is a defining choice for higher education.
• Basinger, Julianne. "500 Academics Sign Petition Protesting Lawsuit Against Cornell U. Professor," The Chronicle of Higher Education, March 20, 1998, p. A14.
• Clegg, Roger. "Photographs and Fraud Over Race," The Chronicle of Higher Education, November 24, 2000, p. B17.
• Ebo, Bosah. "War as Popular Culture: The Gulf Conflict and the Technology of Illusionary Entertainment," Journal of American Culture, Fall 1995, pp. 19-20.
• Fernandez-Armesto, Felipe. Millennium: A History of the Last Thousand Years, New York: Scribner, 1995, pp. 56-59.
• Galbraith, John Kenneth. The New Industrial State, Boston, MA: Houghton Mifflin Co., 1967, pp. 262-282.
• Halberstam, David. The Next Century, William Morrow & Co., Inc., 1991, p. 104.
• Hesburgh, Theodore M. "Where Are College Presidents' Voices on Important Public Issues?" The Chronicle of Higher Education, February 2, 2001, p. B20.
• Karnow, Stanley. Vietnam: A History, New York: The Viking Press, 1983, p. 523.
• Levine, Arthur E. "The Future of Colleges: 9 Inevitable Changes," The Chronicle of Higher Education, October 27, 2000, p. B10.
• Mills, C. Wright. The Power Elite, New York: Oxford University Press, 1956.
• Monaghan, Peter, "A Journal Article is Expunged and Its Authors Cry Foul," The Chronicle of Higher Education, December 8, 2000, p. A14.
• Ornstein, Severo M. "Simulation and Dissimulation," Computer Professionals for Social Responsibility, Summer 1989, Vol. 7, No. 3, p. 1
• Reich, Robert B. The Work of Nations: Preparing Ourselves for 21st Century Capitalism, New York: Alfred A. Knopf, 1991.
• Van Der Werf, Martin. "Labor Violations Found at Factory Used for College Apparel," The Chronicle of Higher Education, February 2, 2001, p. A20.








Monday, June 13, 2016

When you are basing your claim to the U.S. Presidency upon your business acumen...

... then you can't afford to let any light shine on your business debacles.

Thus, Donald Trump moves to sequester the video testimony in the lawsuits against Trump University.

Here's last month's decision that unsealed documents in the principal case:

2016 WL 3036302
Only the Westlaw citation is currently available.
United States District Court,
S.D. California.
Art Cohen, Individually and on Behalf of all Others Similarly Situated, Plaintiff,
v.
Donald J. Trump, Defendant.
CASE NO. 13-cv-2519-GPC-WVGRelated Case: 10-cv-0940-GPC-WVG
Signed 05/27/2016

ORDER GRANTING MOTION OF NON-PARTY PRESS ORGANIZATION FOR LIMITED PURPOSE INTERVENTION AND ORDER UNSEALING COURT RECORDS
[ECF No. 176]
HON. GONZALO P. CURIEL, United States District Judge
*1 Before the Court is non-party press organization WP Company LLC d/b/a The Washington Post's (“WP” or “the Post”) motion to intervene for the limited purpose of requesting the immediate unsealing of exhibits filed with the Court under seal in connection with Plaintiff Art Cohen's Class Certification Motion, see ECF Nos. 39-2, 45-1. WP Mot., ECF No. 176. The motion has been fully briefed. See Def. Opp., ECF No. 199; WP Reply, ECF No. 202. A hearing on the motion was held on May 27, 2016. ECF No. 210.
Upon consideration of parties' briefs, oral argument, and the applicable law, and for the following reasons, the Court GRANTS the Post's motion to intervene.
BACKGROUND
The Post seeks to unseal a number of exhibits attached by Plaintiff Art Cohen (“Plaintiff”) to his motion for class certification, ECF No. 39, and by Defendant Donald J. Trump (“Defendant”) in his response to the motion for class certification, ECF No. 45. Specifically, the Post seeks to unseal ECF No. 39-2, Forge Decl., Exs. 6, 12, 14-21, 27-34A, 36-38, 40, and 44, and ECF No. 45-1, Stagg Decl., Exs. 1-3, 7-22, 24-28, 33-34, and 36. WP Mot. 25.1
Plaintiff does not oppose the motion. Both Plaintiff and Defendant have agreed to the unsealing of 48 of the 52 documents at issue. Def. Opp. 1. Thus, currently at issue are 153 pages from the remaining four documents: Trump University's (“TU”) 2010 Playbook, 2009 Playbook, Field Team Playbook, and Sales Playbook (the “Playbooks”), attached by Plaintiff to the Forge Declaration as Exhibits 6, 21, 27, and 28 respectively. Id.; see ECF No. 39-2.
Magistrate Judge Gallo previously addressed whether to de-designate the Playbooks as confidential in his August 28, 2014 Order (“Gallo Order”) in the related case Low v. Trump University, LLC., No. 3:10-cv-00940-GPC-WVG, ECF No. 343. There, he evaluated Plaintiffs' de-designation motion under a “good cause” standard and found regarding the disputed portions of the Playbooks that:
In isolation, nothing appears to be unique, proprietary, or revolutionary. The information is very routine and commonplace information. However, when considered as a whole or compilation, the information is arguably trade secret, deserving of a “confidential” designation pursuant to the terms of the protective order.
Gallo Order 14. Judge Gallo then performed a line-by-line analysis of the Playbooks and found that the vast majority of the information was either “[n]ot confidential” or only “[a]rguably trade secret.” See Gallo Order, Ex. A. Only in four instances in the Sales Playbook did Judge Gallo determine that there was “trade secret information.” See id. at 23.
The information Judge Gallo found to be “arguably trade secret” in the Playbooks falls into four categories: (1) timelines, rules, and procedures for running TU events; (2) guidelines and scripts for engaging with TU customers; (3) student policies and procedures, such as for auditors, disruptive students, and methods of payment; and (4) employee policies and procedures, such as dress and behavior codes, expenses, and media guidelines. The Playbooks do not contain sensitive personal information of any individual TU customers, but they do contain the names, numbers, and e-mail addresses of a number of TU employees.
*2 The 2009 and 2010 Playbooks contain general overviews of all aspects of TU, while the Field Team Playbook focuses on protocols for running TU events, and the Sales Playbook focuses on how to sell TU programs to customers.
The “arguably trade secret” information in the 2009 and Field Team Playbooks is largely duplicative of that in the 2010 Playbook. Only the Sales Team Playbook offers relatively original information as to the sales and marketing techniques recommended for selling TU programs.
The entire 2010 Playbook has been posted online by Politico.2
DISCUSSION
The Post makes several arguments as to why the documents should be unsealed. First, the Post argues that because the class certification motion was more than tangentially related to the merits of the case, the public has a presumptive right of access and the “compelling reasons” standard applies. WP Mot. 6–11. The Post argues that Defendant cannot meet this standard, because Defendant's asserted commercial interests are insufficient to overcome the presumptive right of access, id. at 16, and the public interest is unusually strong in this case, id. at 19–23. Second, the Post argues that the First Amendment right of access also applies. Id. at 11.
Defendant responds that because the class certification motion was non-dispositive, the “good cause” standard applies. Def. Opp. 5–8. Defendant argues that the contested portions of the Playbooks must remain sealed because they contain trade secrets. Id. at 9–14.
I. Legal Standard
“Historically, courts have recognized a ‘general right to inspect and copy public records and documents, including judicial records and documents.’ ” Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner Commc'ns, Inc., 435 U.S. 589, 597 & n. 7 (1978)). “This right is justified by the interest of citizens in ‘keep[ing] a watchful eye on the workings of public agencies.’ ” Id. (quoting Nixon, 435 U.S. at 598). “Such vigilance is aided by the efforts of newspapers to ‘publish information concerning the operation of government.’ ” Id. (quoting Nixon, 435 U.S. at 598).
Traditionally, the Ninth Circuit drew a distinction between “dispositive” pleadings, such as motions for summary judgment and related attachments, where the strong presumption of access was applied fully, and a party must articulate “compelling reasons” to seal a document, and “non-dispositive” motions, where a “good cause” standard applied. Id. at 1180. In Kamakana, the Ninth Circuit explained that it did so because “the resolution of a dispute on the merits, whether by trial or summary judgment, is at the heart of the interest in ensuring the public's understanding of the judicial process and of significant public events,” whereas “the public has less of a need for access to court records attached only to non-dispositive motions because those documents are often unrelated, or only tangentially related, to the underlying cause of action.” Id. at 1179 (citations omitted) (internal quotation marks omitted).
*3 However, in Center for Auto Safety, the Ninth Circuit recently disapproved of such a “binary” approach based on “mechanical classifications,” reasoning that “[m]ost litigation in a case is not literally ‘dispositive,’ but nevertheless involves important issues and information to which our case law demands the public should have access.” Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1098 (9th Cir. 2016). Reviewing the Ninth Circuit's previous decisions, the court observed that “[t]he focus in all of our cases is on whether the motion at issue is more than tangentially related to the underlying cause of action....It is true that nondispositive motions are sometimes not related, or only tangentially related, to the merits of a case....But plenty of technically nondispositive motions...are strongly correlative to the merits of a case.” Id. at 1099. The Ninth Circuit then “ma[d]e clear that public access to filed motions and their attachments does not merely depend on whether the motion is technically ‘dispositive.’ Rather, public access will turn on whether the motion is more than tangentially related to the merits of a case.” Id. at 1101. Under this standard, the court found that the motion for preliminary injunction at issue was more than tangentially related to the merits of the case. Id. at 1102.
The Post argues that under Center for Auto Safety, the “compelling reasons” standard should apply because a class certification motion is “more than tangentially related to the merits of a case,” WP Mot. 8–11, while Defendant contends that the “good cause” standard should apply. Def. Opp. 5–8.
Recently, two district courts in this Circuit cited Center for Auto Safety in applying the “compelling reasons” standard to class certification motions. See Opperman v. Path, Inc., 2016 U.S. Dist. LEXIS 17222 (N.D. Cal. Feb. 11, 2016) (finding that a class certification motion involves issues that are “more than tangentially related to the merits of the case”); Corvello v. Wells Fargo Bank N.A., 2016 U.S. Dist. LEXIS 11647 (N.D. Cal. Jan. 29, 2016). The Court agrees. As the Supreme Court observed in Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), the “rigorous analysis” a district court is tasked with to ensure that the prerequisites of Federal Rule of Civil Procedure Rule 23(a) have been satisfied at the class certification stage “frequently... will entail some overlap with the merits of the plaintiff's underlying claim.” Id. at 351 (citations omitted) (internal quotation marks omitted) (“[T]he class determination generally involves considerations that are enmeshed in the factual and legal issues comprising the plaintiff's cause of action.” (quoting Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 160 (1982)) (internal quotation marks omitted)). A class certification motion is thus more than tangentially related to the merits of a case.
II. Whether the “Compelling Reasons” Standard is Met
Under the “compelling reasons” test, “a strong presumption in favor of access is the starting point” of the analysis. Kamakana, 447 F.3d at 1178 (quoting Foltz v. State Farm Mutual Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)) (internal quotation marks omitted). “A party seeking to seal a judicial record then bears the burden of overcoming this presumption by...articulat[ing] compelling reasons supported by specific factual findings...that outweigh the general history of access and the public policies favoring disclosure, such as the public interest in understanding the judicial process.” Id. at 1178–79 (citations omitted) (internal quotation marks omitted).
“In turn, the court must ‘conscientiously balance[ ] the competing interests' of the public and the party who seeks to keep certain judicial records secret.” Id. at 1179 (quoting Foltz, 331 F.3d at 1135). “What constitutes a ‘compelling reason’ is ‘best left to the sound discretion of the trial court.’ ” Ctr. for Auto Safety, 809 F.3d at 1097 (quoting Nixon, 435 U.S. at 599). “Examples include when a court record might be used to ‘gratify private spite or promote public scandal,’ to circulate ‘libelous' statements, or ‘as sources of business information that might harm a litigant's competitive standing.’ ” Id. (quoting Nixon, 435 U.S. at 598–99). “The mere fact that the production of records may lead to a litigant's embarrassment, incrimination, or exposure to further litigation will not, without more, compel the court to seal its records.” Kamakana, 447 F.3d at 1179 (citing Foltz, 331 F.3d at 1136).
*4 Defendant argues that the disputed material in the Playbooks contain trade secrets that must remain sealed. Def. Opp. 9. Information is a protectable trade secret if it “(1) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and (2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” Cal. Civ. Code § 3426.1(d); SkinMedica, Inc. v. Histogen, Inc., 869 F. Supp. 2d 1176, 1192 (S.D. Cal. 2012); Religious Tech Ctr. v. Netcom On-Line Commc'n Serv., Inc., 923 F. Supp. 1231, 1250–51 (N.D. Cal. 1995). A trade secret requires proof of independent economic value derived from not being generally known. SkinMedica, 869 F. Supp. 2d at 1192 (citing Cal. Civ. Code § 3426.1(d)(1)). Additionally, a trade secret must be a secret to merit legal protection. Id. Generally, information is secret where it is not generally known, and where the owner has taken “efforts that are reasonable under the circumstances to maintain its secrecy.” Cal. Civ. Code § 3426.1(d); see also Courtesy Temp. Serv., Inc. v. Leonel Camacho, 222 Cal. App. 3d 1278, 1288 (1990).
Information which is too generally known to derive value from secrecy cannot obtain trade secret protection even without disclosure. See, e.g., Designs Art v. NFL Props., Inc., 2000 WL 1919787 at *3 (S.D. Cal. Nov. 27, 2000) (finding that the idea of a tiger for a logo for the Cincinnati Bengals does not merit trade secret protection because the idea of using the subject of a corporate name as a logo for that entity is generally known). In California, “information can be a trade secret even though it is readily ascertainable, so long as it has not yet been ascertained by others in the industry.” ABBA Rubber Co. v. Seaquist, 235 Cal. App. 3d 1, 21 (1991). Thus, whether information is secret is “a relative concept and requires a fact-intensive analysis.” Premier Displays & Exhibits v. Cogswell, 2009 WL 8623588 at *3 (C.D. Cal. Dec. 23, 2009) (citing DVD Copy Control Ass'n Inc. v. Bunner, 116 Cal. App. 4th 241, 251 (2004)).
Material, otherwise individually not protectable, may be a protectable trade secret if combined in a compilation. See SkinMedica, 869 F. Supp. 2d at 1194. A trade secret may consist of several elements, each of which is generally known, put together in a novel and previously unknown combination. Id. (citing O2 Micro Intern. Ltd. v. Monolithic Power Sys., Inc., 420 F. Supp. 2d 1070, 1089–90 (N.D. Cal. 2006) (“Combinations of public information from a variety of different sources when combined in a novel way can be a trade secret. It does not matter if a portion of the trade secret is generally known, or even that every individual portion of the trade secret is generally known, as long as the combination of all such information is not generally known.”)). Thus, establishing that most, or even all, of the elements are generally known does not foreclose the possibility that the information, taken together, constitutes a protectable trade secret. Id. at 1196.
From the general rule governing secrecy, it follows that an unprotected disclosure of the holder's secret terminates the existence of the trade secret. Id. at 1194 (citing Stutz Motor Car v. Reebok Int'l, Ltd., 909 F. Supp. 1353, 1359 (C.D. Cal. 1995)). Even a single public disclosure of information may defeat trade secret protection. See e.g., HiRel Connectors, Inc. v. United States, No. CV01-11069-DSF-BKX, 2006 WL 3618011 at *8–10 (C.D. Cal. Jan. 25, 2006) (finding information was not a protectable trade secret where plaintiff had sent a drawing that disclosed claimed trade secret information to another entity without a non-disclosure agreement).
Here, the complete 2010 Playbook has been posted online by Politico. See Maggie Severns, Tales from the Trump University Legal Vault, Politico (March 3, 2016, 12:54 PM), http://www.politico.com/story/2016/03/trump-university-lawsuit-documents-220181; http://static.politico.com/25/88/783a0dca43a0a898f3973da0086f/trump-university-playbook.pdf. Thus, Defendant's claim that the Playbooks' “[c]ompilations of internal operation procedures and employee scripts” constitute trade secrets has been vitiated by the public disclosure of the 2010 Playbook. In his August 28, 2014 Order, Judge Gallo analyzed the Playbooks and found that “[i]n isolation, nothing appears to be unique, proprietary, or revolutionary. The information is very routine and commonplace information. However, when considered as a whole or compilation, the information is arguably trade secret....” Gallo Order 14.
*5 Moreover, the Court has evaluated the 2009 and Field Team Playbooks and determined that the content in those Playbooks identified as “arguably trade secret” by Judge Gallo is largely duplicative of that found in the 2010 Playbook. Compare Forge Decl., Ex. 6, with Forge Decl., Exs. 21, 27. Only the Sales Team Playbook contains any material that is relatively distinctive. See Forge Decl., Ex. 28. Even there, however, Judge Gallo only designated four sections of the Sales Team Playbook as “[t]rade secret information,” with the majority of passages identified as “[n]ot confidential” or only “arguably trade secret.” Gallo Order, Ex. A.3
In addition, Defendant has only made a blanket assertion as to why the disputed materials constitute trade secrets. See Def. Opp. 11. Where parties have been able to point to concrete factual information or expert testimony that the material sought to be sealed contained confidential business material, such as marketing strategies, product development plans, licensing agreements, and profit, cost, and margin data, courts have been willing to find that information confidential. See In re Electronic Arts, Inc., 298 Fed.Appx. 568, 569 (9th Cir. 2008);Apple Inc. v. Samsung Electronics Co., 727 F.3d 1214, 1224–25 (Fed. Cir. 2013); Algarin v. Maybelline, LLC, No. 12-cv-3000-AJB-DHB, 2014 WL 690410, at *3–4 (S.D. Cal. Feb. 21, 2014). The disputed material contains a number of different types of information, including: (1) timelines, rules, and procedures for running TU events; (2) guidelines and scripts for engaging with TU customers; (3) student policies and procedures; and (4) employee policies and procedures. Defendant has not identified any particular portion of the disputed materials to explain why that portion should remain confidential. See Def. Opp. 11 (claiming only that “the portions of the Playbook [sic] at issue contain non-public information that is fundamental to Trump University's business marketing, and sales strategy. The information is the result of TU's research, experience in the market, and unique strategy.”). Courts regularly decline to protect asserted trade secrets based on such conclusory assertions. See, e.g., Sherwin Williams Co. v. Courtesy Oldsmobile-Cadillac, 2015 U.S. Dist. LEXIS 167713, at *3 (E.D. Cal. Dec. 14, 2015) (“ ‘Conclusory arguments' and ‘blanket’ assertions that documents are ‘confidential and proprietary’ are insufficient to overcome the presumption against sealing.”); Whitecryption Corp. v. Arxan Techs., Inc., 2016 U.S. Dist. LEXIS 31108, at *4 (N.D. Cal. Mar. 9, 2016) (denying sealing request where firm's declaration “offers generalized, unsupported assertions of unfair advantage to competitors without explaining how a competitor would use the information to obtain an unfair advantage”); Ingram v. Pac. Gas & Elec. Co., 2013 U.S. Dist. LEXIS 136887, at *9 (N.D. Cal. Sept. 24, 2013) (rejecting sealing based on “trade secret” claim).
Finally, Defendant argues that the information retains commercial value because “[a]lthough TU stopped enrolling new students in 2010,” TU “may do” so again. Def. Opp. 11. That assertion, however, appears to be wholly speculative. See Hagestad, 49 F.3d at 1434 (rejecting sealing on the basis of “hypothesis or conjecture”).
*6 At the same time, the Post makes a strong argument that the public interest in understanding the judicial process is heightened in this case. As an initial matter, the court must strongly presume the public interest in access. Kamakana, 447 F.3d at 1178. (citation omitted). But “the interest in access to court proceedings in general may be asserted more forcefully when the litigation involves matters of significant public concern.” In re Coordinated Pretrial Proceedings in Petroleum Products Antitrust Litig., 101 F.R.D. 34, 38 (C.D. Cal. 1984). As the Post points out, the Ninth Circuit found that TU was a public figure for purposes of defamation law in the related Makaeff case, explaining that:
[A]ny general interest in Trump University stemming from its celebrity founder soon ripened into an actual dispute over Trump University's business and educational practices...[B]y Fall 2009, the ‘specific question’ of Trump University's legitimacy had become a public controversy.
...
Trump University's business model involved offering seminars that encouraged members of the public to participate in the market for foreclosed properties, which had grown substantially in the wake of the 2007 financial and mortgage crisis. These activities, carried out by Trump University and other purveyors of real estate investment advice, had the potential to affect local housing markets by increasing or decreasing real estate speculation in the market for foreclosed homes. The debate over Trump University's business practices thus held ramifications not just for Trump University and its customers, but for all participants in the local housing markets.
Subsequently, Defendant became the front-runner for the Republican nomination in the 2016 presidential race, and has placed the integrity of these court proceedings at issue. See WP Mot., Exs. A–D. The Ninth Circuit has directed courts considering the public disclosure of litigation materials to take into account “whether a party benefitting from the order of confidentiality is a public entity or official; and... whether the case involves issues important to the public.” In re Roman Catholic Archbishop of Portland in Oregon, 661 F.3d 417, 424 n.5 (9th Cir. 2011) (citation omitted).
Upon review of the briefing, Judge Gallo's Order, and the applicable law, the Court finds that the Post's motion to unseal shall be GRANTED.
First, even under a lower “good cause” standard, Judge Gallo found that the majority of the information was either not confidential or only “arguably trade secret” when taken together as a compilation. The contents of the 2010 Playbook have since been publicly disclosed on the Internet, and the disputed material in the 2009 Playbook and the Field Team Playbook is largely duplicative of that in the 2010 Playbook. Thus, to the extent that the disputed material's trade secret status rested on how it was compiled, the release of the entire compilation vitiates the argument that the compilation constituted a trade secret. Second, Defendant makes only conclusory assertions as to why the disputed material should be considered a trade secret, and upon review of the material, the Court agrees with Judge Gallo that it is largely “very routine and commonplace information.” Third, Defendant's assertion that the information retains any commercial value is speculative given the lack of any support for the statement that TU “may” resume operations after six years, and the public disclosure of the 2010 Playbook on the Internet. Defendant has thus failed to articulate “compelling reasons” for the material to remain sealed.4 At the same time, the Post makes a strong argument that the public interest is heightened in this case.
*7 Accordingly, the Court ORDERS that:
1. The documents requested by the Washington Post with the exception of the Playbooks, ECF No. 39-2, Forge Decl., Exs. 12, 14-20, 29-34A, 36-38, 40, and 44, and ECF No. 45-1, Stagg Decl., Exs. 1-3, 7-22, 24-28, 33-34, and 36, be immediately unsealed.
2. Plaintiff shall file unsealed versions of the Playbooks, ECF No. 39-2, Forge Decl., Exs. 6, 21, 27, 28, with only phone numbers and non-corporate e-mail addresses (i.e., those not ending in “trumpuniversity.com”) redacted, on or before June 2, 2016.
IT IS SO ORDERED.


Isn't it time to try something different?

Insanity: Doing the same thing over and over and expecting a different result.

      Fifty dead and 53 wounded in Orlando.   And on this morning's radio news, we hear about grief management in Orlando; a candlelight vigil in Philadelphia tonight; speculation about whether the killer was homophobic, ISIS affiliated, or both... and of course how a week ago he was able to legally buy an assault rifle and a Glock.  And, of course, the President decries the Congress's lack of action on gun control.  Einstein got it right.

    Let's accept some givens:

1.  As the population grows on this planet, the percentage of nut cases grows exponentially.

2.  With hundreds of millions of guns circulating in the US, no amount of gun control is going to get weapons out of the hands of these crazies.

3.  And, anyway, even if Hilary Clinton wins in November --- by no means a certainty --- the chances for such meaningful national legislation to pass Congress, reach the President's desk, and then withstand Supreme Court scrutiny fades to zero in any realistic assessment.

   

     So isn't it time to give "concealed carry" a serious second look?  Among all the questions I heard being asked on NPR this morning on my way into work, the one that was never asked: What if the bar tenders --- or some of the patrons --- or perhaps even a paid and trained security guard or bouncer --- had been armed at the Orlando club on Saturday night...  might 103 lives not have been shattered?

     If you agree with me that this is a question worth asking this morning, you may want to check out the website of the Concealed Cary Association.  Additionally, Wikipedia has a pretty good overview of the status of concealed-carry in the US today.  And, additionally, here's the latest out of Texas on the issue.

      All I'm saying this morning is:

1.  Nothing we've tried so far has worked.

2.  Realistically our options are limited and Obama's wishful thinking won't change that.

3.  So maybe it's time to accept the reality of too many crazies, too many guns, and the need to protect ourselves and our loved ones.

All I'm asking this morning is that "concealed carry" become a serious part of the conversation, once the hand-wringing and speculation about Orlando dies down.

That's all.


Sunday, June 5, 2016

While many private universities in New Jersey are struggling, largely starved of state funding they once received...

... a public university in the Garden State has been chastised for a gross expenditure of public funds.

Jesus Christ and his twelve apostles were satisfied with a simple wooden table for one of the most famous meetings in the history of the Western World.
But Kean University reportedly spent a quarter million dollars for its new table.  The money for the splurge was derived from the school's operation in China, where the monstrosity was manufactured, according to media reports.  The head of the university's faculty union called this an example of the "lawlessness" of the school's administration.

Kean University's president certainly is a lightening rod for controversy as exemplified by these news stories:

https://www.insidehighered.com/news/2012/02/01/kean-university-president-faces-questions-about-his-academic-record

http://www.nj.com/union/index.ssf/2014/11/kean_u_student_petition_seeks_firing_of_president_over_219k_table.html

http://www.nj.com/news/index.ssf/2013/04/farahi_weathers_storm_at_kean.html

https://www.change.org/p/kean-university-board-of-trustees-fire-kean-university-president-dahwood-farahi

 But President Farahi seems to be as resilient of Christ himself. who reportedly rose from the dead after three days in a tomb.

In case you are curious and haven't already seen a picture of the table:

It surely is a doozy. Perhaps it can be likened to King Arthur's Round Table, although like Christ's Last Supper, the legendary English venue hardly holds a candle to Kean's extraordinary piece of furniture.



I must say, though, the way the knights are garbed does echo academic regalia to a degree.

Anyway, I wonder what some of the cash-strapped, struggling private colleges in New Jersey might be able to do with that $250,000.  How about ten scholarships?  Or some badly needed paving and painting?  Too mundane, no doubt.





Thursday, June 2, 2016

The Crest of a Wave about to Break? Or Just a Bit of Ocean Spray?

Yes, I do like carrying through my Fifth Wave metaphor.  In today's post, I'm referring tot he three small private colleges that have just announced their intention to close:


  1. Dowling College on Long Island
  2. St. Catherine College in Kentucky
  3. Burlington College in Vermont
Debt is reportedly the culprit that killed them all.

So what happens to the students these schools still have.  Molloy College will be back-stopping Dowling as it winds down.

From St. Catherine's we have this "Note from the Trustees":



St. Catharine, KY  –  After numerous recent meetings of the St. Catharine College Board of Trustees, chairman John Turner announced at a campus-wide faculty and staff meeting on Wednesday that the College would be closing its doors. 
"It is with great sadness that I announce today, after exploring all possible options, the Board of Trustees has determined the challenges facing St. Catharine College are insurmountable and we will be closing the College at the end of July," Turner said. 
He went on to say the decline in overall enrollment, caused recently by the federal Department of Education's admitted wrongful withholding of student aid on several key academic programs, has proven to be too difficult to manage with the debt obligation the College has assumed in recent years. 
The debt he referenced was due to the building of new facilities including residence halls, a health-sciences building, and most recently a state-of-the-art library. 
President Cindy Gnadinger and the College’s Board of Trustees have worked tirelessly in attempting to satisfy the requirements of the DoE and to raise hundreds of thousands of dollars in immediate operating funds through this past spring semester.
"Without the enrollment and with the DOE’s chokehold on our cashflow, the debt is simply not manageable," Chairman Turner explained.
According to a newsletter from Gnadinger on April 18, “a detailed and lengthy mediation process… failed to resolve the profound negative impacts that prior DOE decisions have had on our institution.” Mediation failed after other financial aid submissions were rejected for varying reasons, and the DOE failed to agree to pay the Colleges damages for diminishing its overall enrollment and reputation.
The DOE’s sanctioning of the College has not only critically restricted operational cash flow, but has also irreparably damaged the College’s ability to attract students. Prior to the problems with the DOE, enrollment was approximately 600 full-time students. Current enrollment projections are significantly diminished to fewer than 475 students enrolled for the Fall 2016 semester – a drop that College officials exclusively attribute to the negative impact of the DOE’s ongoing refusal to allow financial aid in key academic programs.
In recent weeks, the College administrators and trustees have explored various options for moving ahead and even explored the idea of an alliance with several other institutions. St. Catharine College President, Dr. Cindy Gnadinger, has recently held meetings with other college leaders, but the idea of some type of merger has proven unsuccessful.
The decision came after a board meeting Tuesday night, where the Board voted to close.
College administrators state they have reached out to several other institutions to establish teach-out plans for the current students. College administrators remain committed to ensuring this difficult situation is not exacerbated by a difficult transfer situation for SCC’s students.
Articulation agreements are being put together to ensure students' academic credits will transfer easily and tuition arrangements will be honored as closely to the tuition rates that St. Catharine students are accustomed to paying. 
Chairman Turner expressed his gratitude to the employees of the College for working diligently through what has been an extremely challenging year.
Summer camps and classes will proceed as already scheduled, but no classes will begin in the Fall.
SCC employed 118 full-time faculty and staff employees, as well as numerous part-time staff and adjunct instructors.
Prior to the Board’s decision to close the school, every avenue was investigated to save SCC, according to College officials. One plan of action that the school did implement was to fight the DOE’s strict sanctions by filing a lawsuit in federal court in late February, claiming the DOE was unlawfully withholding student financial aid funds. The lawsuit was filed Feb. 22 in the U.S. District Court for the Western District of Kentucky, based in Louisville.
But SCC did not have the financial capacity or cash flow to stay afloat while the DOE’s rules changed nearly monthly.  This resulted in the College needing $5million to move forward next year and position the school confidently into future.
Some local donors stepped up to help keep the College’s doors open while administration worked through issues with the DOE. However, these fundraising efforts were not enough and not in time.
With the length of time involved in financial aid sanctions, litigation, and other looming capital debt, SCC would not be able to sustain the College’s financial needs even for the coming Fall semester.
What started as a school in a “still house” in the early 1800s and grew to a four-year college in the heart of bourbon country will be shuttered before a new semester starts in the Fall – forever silencing the legacy of its pioneering, founding Dominican Sisters.
After educating thousands of students over the course of nearly 200 years, and after repeatedly addressing all the sanction issues of the DOE to no avail, the tiny private College’s financial crisis will close its doors for good.

The role of the U.S. Department of Education in the school's decision to throw in the towel is telling.  These comments suggest to me an indifference of the DOE toward small private colleges.  We know that the Obama Administration has hitched its wagon to the community college star.  My guess is that little private colleges, such as the three now closing, are small potatoes in the Obama-DOE vision of the appropriate mix of institutions in our industry.




Wednesday, June 1, 2016

Trump University: the Plot Thickens

There are three class-action lawsuits involving Trump University and its namesake, the apparent GOP candidate for President of the United States.  Yesterday, the judge in one of these suits released hundreds of previously sealed documents.  This morning on the way in to work I heard a discussion of this document release and the underlying suits on NPR.  Several facts stand out in my mind:

1.  Trump is personally named as a defendant in these suits.

2.  With little or no media fanfare, he sat for two depositions while pursuing the GOP nomination.

3.  Although the consultants/instructors at Trump University were said in the promotional literature to have been hand-picked by Trump, in these depositions he could not identify these gurus either by name or from a photo line up, according to Yahoo's chief investigative reporter, who appeared on NPR.

4.  Also according to the guest commentators on NPR, the recruiting sessions for Trump U. more closely resembled sales pitches for time-shares then admissions programs for a real university.  Instructions made public yesterday indicate that the salesforce was told to focus on those attendees best able to write a check on the spot and to use hard-sell tactics to get them signed up.  Some litigants claim they paid up to $35,000 in tuition and got little for their money.

5.  Apparently Trump's defense is that written feedback proves that many students did benefit from their studies of Trumps' business techniques.  The plaintiffs counter that the pre-printed evaluations were stacked in favor of producing favorable data.  (A colleague of mine has always asserted that a professor who can't write a student evaluation form that will guarantee positive comments shouldn't be allowed in a classroom.)

Trial is set in one of the cases for a few days after the national election.  Should Trump win in November and the case not settle, this will make for an interesting transition period for the President-elect.