Media Seek Release of Bankruptcy Testimony
An attorney for The Times and other media groups Tuesday urged the California Supreme Court to release grand jury testimony about the Orange County bankruptcy, but lawyers for the county’s brokerage house warned that disclosure would harm innocent people and undo centuries of common law.
The key legal issue before the court is whether a trial judge has the power to release grand jury testimony in cases in which an investigation does not lead to an indictment.
That was the situation in Orange County after then-Dist. Atty. Mike Capizzi cut off the probe after reaching a $30-million settlement with the county’s main broker, Merrill Lynch & Co. After the settlement, media organizations sued for the documents related to the 1994 bankruptcy.
Capizzi’s successor, Dist. Atty. Anthony J. Raukauckas, said Monday that he favors full release of the documents, as occurs when the grand jury brings criminal charges.
But Merrill Lynch attorneys said that, typically, if no indictment is brought, witnesses’ testimony remains secret.
Noting that the bankruptcy cost taxpayers $1.67 billion, Orange County Superior Court Judge David O. Carter ruled in 1997 that the public had a “compelling and fundamental right” to know what went wrong.
The 4th District Court of Appeal agreed with Carter. Merrill Lynch appealed to the Supreme Court, which has 90 days to issue a decision.
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