A federal judge has ordered that videotaped depositions and transcripts from now-closed civil cases against convicted Lincoln Savings & Loan operator Charles H. Keating Jr. be given to Arizona State University for public use.
However, U.S. District Judge Richard M. Bilby also directed that some of the material--much of it pertaining to former Keating co-defendants in the civil litigation--may be restricted for up to 10 years.
Bilby's order, signed Wednesday, won't allow public access for a year to the depositions of employees of three accounting firms that at one time were defendants in the class-action suit.
It also said any accounting firm specifically objecting to disclosure of a deposition based on competitive information or trade secrets must file a motion within a year designating what part of the transcript it wants held from release until January, 2004.
The one-page order also said researchers would be limited to viewing videotapes in the library and could not copy or show them outside the university until after January, 2004.
The material has been sealed from public view under a court order.
The earliest any of the material will be available will be Jan. 2, said Edward Oetting, director of the university's department of archives and manuscripts in Tempe.
"This material is a very good picture of business activities in the Southwest in the 1980s, and I think that in terms of the development and business practices, this will be very important material historically," he said.
More than 20,000 small investors, most of them elderly Southern Californians, lost more than $285 million in April, 1989, when Keating's American Continental Corp. in Phoenix collapsed along with its primary subsidiary, Irvine-based Lincoln Savings.
Lincoln's failure is the nation's second-costliest, leaving taxpayers with a $3.4 billion cleanup bill.
Two years ago, the investors won a jury verdict against Keating and several cohorts that Bilby later reduced to $1.5 billion, including a $1-billion judgment against Keating. But none of that award is expected to be paid because the defendants who remained in the litigation are broke or bankrupt. Keating is serving more than 12 years in prison on state and federal convictions for defrauding investors and looting the thrift.
Instead, investors have received nearly 70 cents on the dollar from settlements with three major accounting firms, five law firms and more than 90 other professionals and associates who helped Keating.
The professional firms were accused of having conspired with Keating to make his companies appear financially healthy to fool regulators and allow the continued sale of the risky bonds issued by American Continental and sold mainly in Lincoln branches.
Now that remaining issues in the litigation have been resolved, Bilby sought to preserve what he considers a historical record. Several firms objected to releasing the videotaped depositions and transcripts on grounds that reputations would be harmed.
Bilby said trade secrets and competitive information about how the accounting firms performed audits or other business procedures deserve protection.
However, he said, concerns relating to possible embarrassment from disclosure of someone's deposition testimony "is outweighed by the public's right to know about the events relating to the collapse of American Continental Corp. and Lincoln Savings & Loan."
The collection will include 80 bankers' boxes of deposition transcripts and exhibits and about nine more of trial and hearing transcripts. Most of the depositions were videotaped. There are nearly 3,000 boxes of other documents in the American Continental Corporation Record Collection.
Bilby won support for his order from an unlikely source: Keating himself. The 70-year-old former real estate developer and financier urged the release of the information because he believes the public deserves an opportunity to see the federal "lies and outrageous claims." Keating has maintained that he is a victim of overzealous regulators with a vendetta against him.