Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 80 C 3479 Susan Getzendanner, Judge.
Before BAUER, POSNER, and FLAUM, Circuit Judges.
We have consolidated for decision two interlocutory appeals (alternatively pleaded as petitions for mandamus, see 28 U.S.C. § 1651) filed by Union Carbide Corporation, a defendant in a large antitrust class action (now in the discovery stage in the district court) brought on behalf of buyers of industrial gases. In the first (Nos. 85-2965 and 85-3039), Union Carbide is trying to appeal from an order by Judge Getzendanner refusing to allow it to interview persons employed by member of the plaintiff class. Because the class is so large (it has 172,000 members), the other prevents Union Carbide from interviewing many potential witnesses -- notably, former employees of Union Carbide now employed elsewhere. About the merits of Judge Getzendanner's order we shall have nothing to say. We do not think the order is appealable or mandamus a proper substitute for an appeal. The general and very salutary rule is that discovery orders are not appealable until the end of the case. See, e.g., Marrese v. American Academy of Orthopaedic Surgeons, 726 F.2d 1150, 1157-58 (7th Cir. 1984) (en banc), rev'd on other grounds, 470 U.S. 373, 105 S. Ct. 1327, 84 L. Ed. 2d 274 (1985); 8 Wright & Miller, Federal Practice and Procedure § 2006 (1970). There is a safety valve: if the party disobeys the order and is punished for contempt or by the entry of final judgment or by any other sanction that has the character of a final decision, he can appeal from that. United States v. Ryan, 402 U.S. 530, 532-33, 29 L. Ed. 2d 85, 91 S. Ct. 1580 (1971); Marrese v. American Academy of Orthopaedic Surgeons, supra, 726 F.2d at 1157. But Union Carbide has not yet attempted to avail itself of this route.
It argues however that his case is special because it involves a question under the First Amendment. It is true that in free-speech cases interlocutory appeals sometimes are more freely allowed, and writs of mandamus sometimes more freely issued, than in other types of case, especially where the interlocutory order can be characterized as imposing a "prior restraint" on speech or the press. See, e.g., Chase v. Robson, 435 F.2d 1059, 1062 (7th Cir. 1970) (per curiam); In re San Juan Star Co., 662 F.2d 108, 113 (1st Cir. 1981). It is also true that an order limiting communication between named plaintiffs (and their lawyers) and members of the plaintiff class was invalidated on First Amendment grounds in Gulf Oil Co. v. Bernard, 452 U.S. 89, 68 L. Ed. 2d 693, 101 S. Ct. 2193 (1981). The present case is different, however. Without meaning to prejudge the merits of Union Carbide's constitutional challenge, we note that the limitation here is on communications with an adversary, that such a limitation grows out of the established principle that a lawyer for one party is forbidden to communicate directly with the opposing party, and that Union Carbide is seeking not to communicate its own views but merely to question witnesses. Cf. Resnick v. American Dental Ass'n, 95 F.R.D. 372, 376-77 (N.D. Ill. 1982). The threat to free speech is not so palpable as to warrant a departure from the usual principal of finality that governs federal appeals. Even more clearly, Union Carbide's nonconstitutional challenge to the order (that the judge misinterpreted the provision of the Code of Professional Responsibility that forbids lawyers to contact an opposing party directly) cannot be appealed at this time.
Union Carbide's other challenge is to Judge Getzendanner's denial of its motion that she recuse herself from the case. This challenge fits within an exception to the final judgment rule. A judge's refusal to recuse himself in the face of a substantial challenge casts a shadow not only over the individual litigation but over the integrity of the federal judicial process as a whole. The shadow should be dispelled at the earliest possible opportunity by an authoritative judgment either upholding or rejecting the challenge. In recognition of this point we have been liberal in allowing the use of the extraordinary writ of mandamus to review orders denying motions to disqualify. See, e.g., Pepsico, Inc. v. McMillen, 764 F.2d 458, 460 (7th Cir. 1985); SCA Services, Inc. v. Morgan, 557 F.2d 110, 117-18 (7th Cir. 1977) (per curiam); see also In re IBM Corp., 618 F.2d 923, 926-27 (2d Cir. 1980); In re United States, 666 F.2d 690, 694 (1st Cir. 1981); 9 Moore's Federal Practice P110.13 (2d ed. 1985).
Of course in frivolous and even routine cases in which a party challenges the judge's refusal to recuse himself, mandamus will be denied -- with sanctions, if the petition for mandamus is frivolous. But where a serious question is raised, we shall interpret generously our power to issue the writ, in order that we may lay the question to rest at the earliest possible time. We therefore need not decide the difficult question whether a ruling on disqualification can ever be certified for an immediate appeal under 28 U.S.C. § 1292(b), as Judge Getzendanner attempted to do here.
There is another point. We have held, in part because of the importance "of preventing injury to the public perception of the judicial system before it has a chance to occur," that mandamus is the only method of correcting a judge's erroneous refusal to recuse himself under 28 U.S.C. § 455(a), which requires a judge to recuse himself "in any proceeding in which his impartiality might reasonably be questioned." United States v. Balistrieri, 779 F.2d 1191 (7th Cir. 1985). As it happens, one of Union Carbide's grounds for recusal of Judge Getzendanner is based on section 455(a); and it is so closely related to the company's section 455(b) ground that both should be decided together, which can only be done in this mandamus proceeding.
The recusal issue, unique in our experience, arises as follows. The suit was filed in July 1980 and a few months later assigned to Judge Getzendanner, who two and a half years later, in February 1983, married a man whose self-managed retirement account happened to contain some $100,000 worth of stock of IBM and Kodak. The judge had no reason to think that her marriage would have any effect on the propriety of her continuing to preside over the case. Neither IBM nor Kodak were named plaintiffs; nor would it have seemed likely to a person without a technical background - a person who did not know for example that liquid nitrogen is used by both companies for supercooling in various technical processes - that either company would be a member of the plaintiff class, limited as it is to buyers of oxygen, nitrogen, and argon. There was at the time no list of class members. In May 1984 and then again in May 1985 Judge Getzendanner in her required annual financial disclosure statements (28 U.S.C. App. §§ 301 et seq.) disclosed her husband's stock interest. Not until July 1985 did Union Carbide move the judge to rescue herself, pointing out that IBM and Kodak had in fact bought industrial gases from defendants during the period covered by the complaint. The motion was based on 28 U.S.C. § 455(b), which provides (so far as pertinent here) that a federal judge "shall disqualify himself . . . [where] (4) He knows that he . . . or his spouse . . . has a financial interest . . . in a party to the proceeding." The statute defines "financial interest" as "ownership of a legal or equitable interest, however small." 28 U.S.C. § 455(d)(4).
Judge Getzendanner immediately ceased ruling on any motions in the case while the parties briefed the issue whether the statute would be violated if her husband sold the stock in his retirement account. (All concerned agree that an unnamed class member is a "party" under the statute.) During this period all motions were referred to a magistrate or another judge. After the issue was briefed Judge Getzendanner held that she could properly resume control of the case if her husband sold the stock. He did, incurring a brokerage fee of $900, but no capital gains tax, because the retirement account is tax-free; and he invested the proceeds in a money market fund. Union Carbide argues that the sale did not cure the mandatory disqualification of section 455(b) and, if it did, still Judge Getzendanner's continuing to preside in the case violates section 455(a).
What makes the case unusual is the unlikely confluence of a class action, a judge's marrying pendente lite, and a tax-free retirement account. If Eastman Kodak and IBM had been named plaintiffs, Judge Getzendanner would have known in February 1983 (when she got married), or at the latest in May 1984 when she filed her financial disclosure form, that she had a financial interest in a party. If she had owned the stock when she became a judge, the parties might have discovered early on that she had an interest in a potential class member. And if her husband had not owned the stock in a tax-free retirement account he probably would not have been willing to sell it and incur a capital gains tax (assuming the stock had appreciated since he had acquired it), in which event Judge Getzendanner would unquestionably have had to recuse herself. We must decide whether this most unusual case is within the purview of either subsection (a) or subsection (b) of section 455. We start with (b).
The purpose of (b) is to establish an absolute prohibition against a judge's knowingly presiding in a case in which he has a financial interest, either in his own or a spouse's (or minor child's) name. Before the statute was passed judges did not recuse themselves in such cases unless the interest was so large that a reasonable person might think it could influence the judge's decision. This standard was too nebulous -- not least from the judge's standpoint -- and Congress replaced it by a flat prohibition. Although the prohibition results in recusal in cases where the interest is too small to sway even the most mercenary judge, occasional silly results may be an acceptable price to pay for a rule that both is straightforward in application and spares the judge from having to make decisions under an uncertain standard apt to be misunderstood. See H.R. Rep. No. 1453, 93d Cong., 2d Sess. 2 (1974).
It is not apparent however whether the statute covers the situation where the judge had a financial interest in a party, without knowing it; divested himself of the interest as soon as he discovered it; and made no rulings between the date of discovery and the date of divestment. When Judge Getzendanner discovered in July 1985 that she had a financial interest in a "party" she immediately suspended her involvement in the case. Although the case was not formally reassigned to another judge, any matters requiring a judicial ruling were referred to other judges; it was as if she had recused herself. Then however her husband sold the stock and she resumed control of the case. It was as if she had been reassigned to it. And when reassigned she no longer had a financial interest in it. Since the statute forbids only the knowing possession of a financial interest, since Judge Getzendanner relinquished control of the case as soon as she found out about the financial interest, and since she did not resume control until the financial interest was eliminated, at no time was she in literal violation of the statute.
We must of course consider the purpose as well as the bare words of the statute. But the purpose as we have said is just to make sure that judges do not sit in cases in which they have a financial interest, however small. Judge Getzendanner has no financial interest in this case. If she were to rule in favor of the plaintiffs it could not put a nickel in her pocket, because neither she nor her husband own securities of any member of the plaintiff class. Before she discovered she had a financial interest, she could have had no incentive to favor the plaintiffs; when she knew she had such an interest, she mad no rulings in the case; now, when she has no interest, she cannot enrich herself by favoring the plaintiffs. The statutory purpose would ...