Media join fight against Delaware's 'secret' court hearings

Wed Jan 16, 2013 3:37pm EST
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* Media groups say closed hearings hurt court's integrity

* Appeals court to decide if judges can hear arbitrations

* Business groups say Delaware system benefits shareholders

By Tom Hals

Jan 16 (Reuters) - Major U.S. news organizations have urged a federal appeals court to prevent Delaware from allowing sitting judges to arbitrate business disputes in private, saying the system raised suspicions of preferential treatment for corporations.

The case involves Delaware's Court of Chancery, a premier venue for business and shareholder disputes, and the state's bid to attract more companies to incorporate in Delaware by allowing them to resolve disputes privately before Chancery judges.

The news organizations filed a friend of the court brief on Monday arguing that shutting the public out of the courtroom during high-stake disputes would diminish the court's integrity.

The organizations included Thomson Reuters Corp's Reuters America LLC unit, Wall Street Journal publisher News Corp, New York Times Co, The Associated Press and Bloomberg LP.

"This would lead to fundamental unfairness by creating suspicion that a different set of rules apply to corporations pursuing multimillion-dollar civil claims against each other," the brief, filed with the 3rd U.S. Circuit Court of Appeals in Philadelphia, said.   Continued...