United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 12, 1997 Decided February 17, 1998
No. 96-5317
Clark M. Clifford and
Robert A. Altman,
Appellants
v.
United States of America, et al.,
Appellees
Appeal from the United States District Court
for the District of Columbia
(No. 96ms00266)
Timothy J. Preso argued the cause for appellants, with
whom William H. Jeffress, Jr., Martin D. Minsker and
Douglas F. Curtis were on the briefs.
Marc J. Gottridge argued the cause for appellees, with
whom Sol Neil Corbin, Stephen J. Brogan, Eric L. Lewis and
Michael Nussbaum were on the brief for appellees First
American Bankshares, Inc., et al.
Mary Lou Leary, U.S. Attorney at the time the brief was
filed, Michele L. Crawford, Trial Attorney, and Stefan D.
Cassella, Assistant Chief, U.S. Department of Justice, were
on the brief for appellee United States of America.
Before: Williams and Rogers, Circuit Judges and
Buckley, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge: Appellants, Clark M. Clifford and
Robert A. Altman, appeal an order of the district court
denying access to certain sealed documents and transcripts of
in camera conferences between the judge and a court-
appointed trustee in the course of an ongoing criminal forfei-
ture proceeding. Appellants are not party to that proceed-
ing, but are involved in several civil actions pending before
the same judge as adversaries to the parties appearing in the
criminal matter. Appellants contend that the communica-
tions between the trustee and the judge relate to their
concurrent civil cases and that due process requires that they
be notified and provided with copies of any such communica-
tions. Because appellants have failed to provide sufficient
evidence to overturn the district court's finding that the
submitted information did not involve matters directly related
to the civil litigation, and because their other grounds for
access to the sealed documents, rooted in the equitable princi-
ples of trust law, are unpersuasive, we affirm.
I.
This appeal involves a subsidiary dispute arising out of the
lengthy and ongoing legal proceedings involving the Bank of
Credit and Commerce International ("BCCI") and the related
activities of its officers, directors, and shareholders. Suffice
it to say for purposes of the instant appeal that BCCI pled
guilty to several state and federal charges, including conspira-
cy to violate the Racketeer Influenced and Corrupt Organiza-
tions Act ("RICO") by illegally acquiring a controlling inter-
est in First American Bankshares, Inc. ("FAB") and First
American Corporation ("FAC") (collectively "First Ameri-
can"). See 18 U.S.C. s 1962(c), (d) (1988). As a result,
pursuant to an agreement between BCCI and the United
States, the district court ordered the forfeiture of all of
BCCI's property in the United States, including whatever
interest it may have had in First American. As relevant
here, the court ordered the forfeiture of "the net proceeds
from the future sale or other disposition or transfer of any
stock, security or other interest in First American Bank-
shares, Inc., but not the stock, security or other interest
itself."
Executing this forfeiture agreement proved to be compli-
cated due to the nature of the conspiracy. BCCI did not
directly own any interest in First American. Rather, through
intermediaries, it acquired a controlling interest in a Nether-
lands Antilles corporation, Credit and Commerce American
Holdings, Inc. ("CCAH"). The extent of this interest was
uncertain at the time of the forfeiture order but has been
subsequently calculated to amount to 61.156%. Other share-
holders in CCAH included appellants Clifford and Altman,
whose shares have been estimated at 0.828% and 0.414%
respectively. In turn, CCAH owned a subsidiary corporation,
Credit and Commerce American Investment ("CCAI"), which
owned FAC, which owned FAB.
Faced with this tangle of interlocking subsidiary corpora-
tions, the United States decided that the best course for
recovering its forfeited interest was to dissolve First Ameri-
can and liquidate its assets. To facilitate the process, the
government proposed the appointment of a trustee under 18
U.S.C. s 1963(e) and developed a plan whereby CCAH would
transfer all of its interest in First American to the trustee,
who would "have all rights, titles, powers, and privileges of a
shareholder of FAC, including ... the right to exercise
exclusively any and all voting rights and any other rights or
benefits attached to ... the FAC shares." According to the
plan, once the trustee completed the sale of First American,
the district court would order the equitable distribution of the
net proceeds (after payment of expenses) to the United States
and any outstanding shareholders of CCAH.1 Because BCCI
was not the sole shareholder of CCAH, the government
needed to win the approval of others to muster the 75% share
vote necessary for the plan to take effect, and on May 12,
1992, CCAH's shareholders, including Clifford and Altman,
approved the proposed transaction. Subsequently, the dis-
trict court appointed a trustee and required him to prepare
quarterly progress reports.
The trustee successfully completed the sale of First Ameri-
can's assets, and in October 1994 filed a motion seeking a
"Procedural Order" on the procedures he should follow in
dissolving the corporation, completing its liquidation, and
distributing the proceeds. Following a public hearing on
December 19, 1994, the court, by order dated two days later,
directed the trustee to obtain lists of all proceedings and
claims against First American, the amounts estimated as
appropriate to reserve for payment for each, and estimated
associated expenses, and to file these documents under seal.
Meanwhile, several civil lawsuits involving appellants Clif-
ford and Altman began to unfold. Appellants had served in
various capacities for BCCI prior to its legal difficulties. In
addition to owning shares in CCAH, they had also served as
directors and officers of CCAH, CCAI, and First American
and as legal counsel for BCCI and First American. On June
24, 1993, the trustee, on behalf of First American, filed suit
against several defendants, including Clifford and Altman, for
their participation in the acquisition of First American by
BCCI, alleging violations of RICO, common law fraud, breach
of fiduciary duty, and conspiracy. See First Am. Corp. v. Al-
Nahyan, No. 93-1309 (D.D.C. filed June 24, 1993). Similarly,
on July 1, 1994, BCCI's fiduciaries filed suit alleging that
Clifford and Altman (as well as their former law partners)
had breached their fiduciary duties and improperly represent-
ed both BCCI and First American during their financial
dealings despite conflicts of interest. See BCCI Holdings,
S.A. v. Clifford, No. 94-1461 (D.D.C. filed July 1, 1994). Both
__________
1 Any shareholder or other party who wished to contest the
government's share could intervene in the distribution proceedings
under 18 U.S.C. s 1963(l).
lawsuits are currently pending before the same judge who is
presiding over the criminal forfeiture proceedings.
Appellants have also filed several civil lawsuits of their own.
In March 1995, appellants filed a claim in the federal court in
the Eastern District of Virginia for indemnification from First
American. See Clifford v. First Am. Corp., No. 95-377-A
(E.D. Va. filed Mar. 24, 1995). They sought reimbursement,
as officers and directors of First American, for legal fees
incurred in the successful defense of criminal charges that
had been brought against them in New York.2 This lawsuit
was ultimately transferred to the District Court for the
District of Columbia and assigned to the same judge. See
Clifford v. First Am. Corp., No. 95-877 (D.D.C. filed May 10,
1995). In September 1995, appellants filed another indemnifi-
cation suit in federal court here against First American,
seeking reimbursement for the defense of the civil claims
brought against them by BCCI and First American and an
administrative action being pursued by the Federal Reserve
Board. See Clifford v. First Am. Corp., No. 95-1689 (D.D.C.
filed Sept. 5, 1995). That lawsuit has been stayed pending
the outcome of the other civil lawsuits currently before the
district court.
In the instant case, appellants filed a motion on November
13, 1995, to intervene in the criminal proceeding against
BCCI for the "limited purpose of obtaining disclosure of
information that has been communicated to [the district
court] by parties ... [or] the First American Trustee ... and
that may be communicated in the future." Asserting that
several communications between the trustee and the judge in
the course of the forfeiture proceedings related to their
concurrent civil litigation, appellants requested notes of a
November 16, 1992, in camera discussion among the judge,
the trustee, and counsel for both BCCI's fiduciaries and the
United States.3 This off-the-record conference was prompted
__________
2 For a summary of the disposition of the criminal cases against
appellants, see People v. Abedi, 607 N.Y.S.2d 862 (N.Y. Sup. Ct.
1994).
3 On appeal, appellants also mention a second in camera con-
versation between the trustee and the judge that occurred after the
by remarks made by counsel for the BCCI fiduciaries that he
wished to discuss "a future piece of litigation." Appellants
maintain that this remark, as well as other statements made
by the prosecutor, were meant to refer to the Al-Nahyan
action and the BCCI suit that was later filed against them.
Appellants also object to their lack of access to certain
material contained in a sealed report filed by the trustee in
July 1995.4 Pursuant to the Procedural Order, the trustee
submitted a "Report on the First List of Claims and Contin-
gencies of First American" containing a list of pending legal
proceedings and claims asserted against the corporation, in-
cluding the various actions involving appellants. This docu-
ment, placed in the public record and obtained by appellants,
referred to another report filed under seal with the court at
the same time that included First American's "Reserve Lists"
and "Expense and Indemnity List" as required by the Proce-
dural Order. Upon reviewing the public report, appellants
requested a copy of the sealed document from the trustee.
When their request was refused, appellants moved to inter-
vene in the criminal proceeding to gain access to the sealed
report and any other sealed documents submitted to the court
that referred to their civil lawsuits. They also requested that
they be notified and served with copies of any future filings
that relate to pending civil lawsuits in which they are parties.
In opposing appellants' motion, the trustee revealed that the
sealed report contained "brief explanatory narrative[s] de-
scribing the nature and status of pending claims and proceed-
__________
hearing on the proposed Procedural Order on December 19, 1994.
This communication was not identified in appellants' motion to
intervene in the district court. There is no indication that this
conference concerned appellants; the judge merely invited the
trustee into her chambers to discuss "other[ ] matters."
4 Appellants further object to the treatment of other communi-
cations that were not filed under seal: the trustee's "Second
Interim Report on Trust Activities," filed May 15, 1995, and his
"First List of Claims and Contingencies," filed July 19, 1995.
Because these documents were available in the public record,
appellants' only contention appears to be that they were not served
with copies of the reports.
ings" as well as the required lists of reserves maintained by
First American for each outstanding claim. Appellants rely
on this revelation to support their contention that the commu-
nications between the trustee and the judge addressed the
merits of their claims.
Denying the motion to intervene in the criminal proceeding
without comment,5 the court, sua sponte, treated the motion
as if it had been "properly filed as a miscellaneous case under
Local Rule 307.1." See D.D.C. R. 307.1. The court ruled
that appellants had waived their objections to the Procedural
Order and, therefore, could not seek disclosure of the sealed
reports. The court further found that "disclosure is ...
inappropriate because the material filed under seal, or to be
filed under seal, involves matters not directly related to [the]
civil litigation." The court also denied appellants' request for
transcripts of the in camera discussions because they "did
not involve the merits of any litigation filed by, or against,
Clifford and Altman."
We review the district court's refusal to disclose the sealed
documents and any in camera discussions for abuse of discre-
tion. Cf. EEOC v. National Children's Ctr., Inc., 98 F.3d
1406, 1409 (D.C. Cir. 1996); In re National Broad. Co., 653
F.2d 609, 613 (D.C. Cir. 1981)
II.
Complex litigation may often require the district court to
consider facially conflicting claims against some or all of the
parties involved in the initial underlying litigation. As a
matter of court management and efficiency, the assignment of
related matters to a single judge is preferred. See D.D.C. R.
405. Indeed, the courts have developed rules and presump-
tions that enable the most efficient use of limited judicial
__________
5 Appellants do not appeal the formal disposition of their mo-
tion to intervene in the criminal proceedings. Therefore, we need
not address the proper procedural mechanism for non-parties to
seek disclosure of documents sealed in a criminal trial. See United
States v. Hubbard, 650 F.2d 293, 308-13 (D.C. Cir. 1980); In re
Washington Post Co., 576 F. Supp. 76, 77 n.1 (D.D.C. 1983).
resources while at the same time protecting the various
parties' rights to have their claims and arguments heard and
decided by an impartial decision-maker. Trial judges fre-
quently receive extraneous information about parties appear-
ing before them but are presumed to disregard it. See
Harris v. Rivera, 454 U.S. 339, 347 (1981). In the course of a
trial, as well as at pre-trial suppression hearings or during
discovery, a judge may inspect documents or evidence that go
to the heart of a party's case but are ultimately determined to
be inadmissible. See United States v. Cowden, 545 F.2d 257,
265-66 (1st Cir. 1976) (recognizing that judges "are necessari-
ly exposed to [matters outside the record] in the course of
ruling on the admission of evidence"). Similarly, a judge may
have personal experience with particular parties who have
appeared before her in previous cases, or she may have
learned about underlying events by presiding over related
trials. See id. Yet such prior knowledge does not, by itself,
generally raise questions about the fairness of a judge.6 See
Liteky v. United States, 510 U.S. 540, 550-51, 555 (1994);
United States v. Roach, 108 F.3d 1477, 1484 (D.C. Cir. 1997);
Paradis v. Arave, 20 F.3d 950, 956-57 (9th Cir. 1994).
Judges are presumed to be able to compartmentalize the
information they receive and only rely on evidence relevant
for a particular decision. See Harris, 454 U.S. at 346;
United States v. Menk, 406 F.2d 124, 126-27 (7th Cir. 1968);
In re M.D.J., 346 A.2d 733, 736 (D.C. 1975).
Still, the instant case appears somewhat unusual in that a
single district court judge is presiding over a civil lawsuit
__________
6 Of course, if a judge's personal knowledge rises to the level
where it creates the appearance of bias or prejudice, then the
judge's recusal is required under 28 U.S.C. s 455. See Liteky v.
United States, 510 U.S. 540, 548, 554-56 (1994); see also Model
Code of Judicial Conduct Canon 3E(1) (1990). But, in the instant
case, appellants have not sought the disqualification of the district
court judge, nor do they claim that her communications with the
trustee have actually affected her impartiality. Hence, we have no
occasion to consider the circumstances under which a judge per-
forming both administrative and judicial functions over related
cases should transfer one or both of the cases to another judge.
(and other related civil lawsuits) while at the same time
superintending the administration of a criminal forfeiture
proceeding arising out of the same operative facts and involv-
ing some of the same parties. From their perspective as
litigants in the civil lawsuits, appellants view the sealed
reports filed by the trustee and his other discussions with the
judge in the criminal proceeding as ex parte communications.
They contend that these communications create an unfair
advantage for the trustee in the civil litigation, or at the very
least the appearance of unfairness, and violate the "funda-
mental concepts of fairness and equity embodied in the due
process clause of the Fifth Amendment." Without seeking
recusal of the judge, they maintain that due process requires
that they receive notice of, and access to, any submissions by
their adversaries so that they may have an "opportunity to
know the claims of the opposing party and to meet them."
Morgan v. United States, 304 U.S. 1, 18 (1938).7
Appellants' contentions overstate the strength of their due
process claim. Even within the context of a single adversary
proceeding, communications between a judge and one party
are not per se deprivations of the due process rights of the
opposing party, see In re Paradyne Corp., 803 F.2d 604, 612
(11th Cir. 1986), and consequently, not all ex parte communi-
cations must be disclosed, particularly when there is a coun-
tervailing need for confidentiality. Due process concerns
about the effect of such communications on the fairness of a
trial as a whole are further mitigated where, as here, the trial
is before a jury and the judge is not the ultimate finder of
fact.8 See United States v. Sepulveda, 512 F. Supp. 592, 594
__________
7 When concerns arise over the effects of ex parte communica-
tions on the fairness of a trial, prejudiced parties ordinarily seek
either a remand for a new hearing, see, e.g., Strang v. United States
Arms Control & Disarmament Agency, 920 F.2d 30, 32 (D.C. Cir.
1990) (per curiam), or reassignment of the case to a different judge,
see, e.g., Edgar v. K.L., 93 F.3d 256, 262 (7th Cir. 1996); United
States v. Microsoft Corp., 56 F.3d 1448, 1465 (D.C. Cir. 1995).
Appellants, however, merely request disclosure as a remedy for the
alleged denial of due process.
8 Indeed, the fact that three of the civil lawsuits have recently
been assigned to a mediator, with the fourth likely soon to follow,
(D.D.C. 1981); cf. United States v. Robin, 553 F.2d 8, 10 (2d
Cir. 1977) (per curiam).
Ex parte submissions are permissible to determine whether
documents sought by a party enjoy a privilege against discov-
ery, see In re Eisenberg, 654 F.2d 1107, 1112 (5th Cir. Unit B
Sept. 1981); cf. Kerr v. United States Dist. Court, 426 U.S.
394, 405 (1976), "to prevent frustration of a statutory purpose
to limit access to Government papers," In re Taylor, 567 F.2d
1183, 1188 (2d Cir. 1977), or "to resolve fears of intimidation
of a witness," In re Paradyne Corp., 803 F.2d at 612. Due
process, however, requires that a party be aware of and
allowed to refute "the evidence against the merits of his
case." In re Eisenberg, 654 F.2d at 1112 (emphasis added).
Thus, in Rushen v. Spain, 464 U.S. 114 (1983) (per curiam),
the Supreme Court "emphatically disgree[d]" with the Ninth
Circuit's conclusion that an unrecorded ex parte communica-
tion between the judge and a juror in a criminal trial can
never be harmless error. Id. at 117. Instead, the Court took
the position that, while an ex parte communication relating to
"some aspect of the trial ... generally should [be] disclose[d]
... to counsel for all parties," id. at 119, the particular ex
parte communication in question was "innocuous" because the
judge and juror "did not discuss any fact in controversy or
any law applicable to the case," id. at 121. The Court saw no
reason to dispute the trial judge's affirmation at a post trial
hearing that the ex parte communications "lacked any signifi-
cance" and that no prejudice had resulted. Id. at 116.
Although Rushen was somewhat different from the instant
case, in that it involved the charge that the judge's contact
with a juror may have prejudiced the juror, the Court's
approach to ex parte communications is instructive. Thus,
when a party conveys ex parte information to a judge that
relates to a pending case, courts presume that the trial judge,
who is in the best position to evaluate the information, can
adequately determine whether such communications go to the
merits of the case and promptly stifle them or require
__________
further reduces the relevance of appellants' concerns about the
effect of these communications on the fairness of their trials.
disclosure when necessary. See id. at 120. Without such a
presumption, the process for handling litigation would become
inordinately complex, occasioning additional delays and en-
cumbering burdened trial judges with piecemeal responsibili-
ties incompatible with the necessities of efficient trial man-
agement. See generally Civil Justice Reform Act of 1990, 28
U.S.C. ss 471-473 (Supp. IV 1992).
Here, the judge received information from the trustee that
she had already deemed sufficiently sensitive and confidential
so as to warrant precluding public disclosure. The judge
found that the contents of these communications did not
concern the merits of appellants' pending civil actions. It is
appellants' burden to offer some evidence that would cast
serious doubt on this finding, see United States v. Taylor, 997
F.2d 1551, 1553 (D.C. Cir. 1993); cf. United States v. Pollard,
959 F.2d 1011, 1031 (D.C. Cir. 1992) (respecting trial judge's
personal knowledge of the existence of ex parte submissions),
and yet, upon examination, their contentions amount to little
more than surmise and speculation. Accordingly, we defer to
the trial court's factual determination.
The sealed trustee reports sought by appellants primarily
contain lists of the amounts placed on reserve by First
American to cover their expected liabilities and expenses in
the various civil lawsuits still pending. This information has
no apparent bearing on the merits of those lawsuits, for as
the trustee explained to the district court, the amounts placed
on reserve equal the full amount of pending claims and
"reflect nothing about [First American's] judgment on the
merits of various actions." These amounts, therefore, were
already known by appellants, as they readily admit, as well by
the court.
Nevertheless, appellants contend that "it is not the reserve
figures themselves, but the narratives supplied by First
American to accompany the reserves, that Messrs. Clifford
and Altman seek." 9 But this position is no more persuasive.
__________
9 Appellants' original motion to intervene requested disclosure
of the sealed reports before they knew of the existence of the
narratives.
There is nothing to suggest that these brief "narratives" do
anything more than explain the nature and status of pending
claims and proceedings by or against First American, includ-
ing the civil lawsuits to which appellants are parties. The
judge presumably already has knowledge of the progress of
these lawsuits, since she is presiding over them. Indeed, if
the Second Interim Report filed by the trustee on May 15,
1995, is any indication of the content of these "narratives,"
appellants' speculations are unfounded. Appellants rely on
this publicly docketed report as evidence of improper commu-
nications between the trustee and the judge because it con-
tains a discussion of the Al-Nahyan litigation in which appel-
lants are defendants. This report, however, merely discusses
the facts surrounding several settlements negotiated by First
American with defendants other than appellants. In passing,
the report only mentions without elaboration that the claims
against appellants are still outstanding and that motions to
dismiss the claims were pending before the court. Nothing in
the report even approaches a discussion of the law or facts
relevant to appellants' lawsuits, and there is nothing to sug-
gest that the "narratives" in the sealed reports are more
substantive.10
__________
10 Appellants' position with respect to the sealed reports is
further weakened by their failure to take advantage of notice of the
trustee's motion to enter the Procedural Order. Prior to the
hearing on the order, appellants' counsel had received courtesy
copies of the trustee's motion and the proposed order. Appellants
were thus aware that, as paragraph 6 of the order detailed, certain
reports would be sealed and that those reports would contain
information relating to claims asserted by or against First Ameri-
can, including "Reserve Lists," an "Expense and Indemnity List,"
and comments by the trustee. Yet appellants acknowledge that
they failed to make any appearance at the hearing, which was
scheduled on the public docket, or file a written opposition. Hence
appellants' contention that they could not have waived their alleged
right to challenge the sealing of the reports because they were not
directly notified that the hearing had been scheduled is unpersua-
sive.
Appellants' assertions regarding the in camera conversa-
tions among the judge, the prosecutor, BCCI fiduciaries'
counsel, and the trustee are even more speculative. On
November 16, 1992, counsel for the court-appointed BCCI
fiduciaries rather cryptically requested to speak off the rec-
ord about "a future piece of litigation." At the same hearing,
the prosecutor later remarked that the trustee also "wishes to
raise a matter best made on the record and under seal." 11
The judge decided to "talk in chambers, not even on the
record" about both issues. From these brief statements,
appellants somehow draw the inference that the matters
discussed involved themselves. Yet the BCCI fiduciaries did
not file suit against appellants until July 1, 1994--over one
and a half years after this conference--and the trustee did
not commence the Al-Nahyan lawsuit until June 24, 1993.
__________
Furthermore, by the time of the hearing, the Al-Nahyan and
BCCI actions had already been filed against appellants, and appel-
lants apparently had already decided to pursue indemnification for
the costs of their criminal defenses. See Mem. in Reply to Opp'n to
Mot. Relating to Indemnification at 1-2, United States v. BCCI
Holdings, S.A., No. 91-0655 (D.D.C. filed Nov. 15, 1991). There-
fore, by that date if not before, appellants should have been alerted
to the sensitive nature of the information to be placed under seal.
Indeed a passage in a memorandum in support of appellants' motion
for indemnification filed in the criminal proceeding indicates that
appellants were fully aware of the possible effects of the proposed
Procedural Order even before they received copies of it. See Mem.
in Reply to Opp'n to Mot. Relating to Indemnification, supra, at
12-13. They had requested a hearing on the "procedural scheme"
being considered by the judge because it would "obviously have a
significant impact" on their "interests." Id. Thus, under these
circumstances, the judge could properly find that appellants had
made a knowing and intelligent waiver of any right they may have
had to obtain access to the sealed reports. See Johnson v. Zerbst,
304 U.S. 458, 464 (1938).
11 On appeal, First American maintains that the trustee's infor-
mation concerned his decision to replace the Chairman and Board of
Directors of First American later that day and thus did not involve
appellants. While plausible, this explanation is without record
support.
Consequently, there is scant evidence to suggest that the
alleged ex parte communications even related to appellants'
currently pending civil lawsuits. There is no evidence to
suggest, moreover, that any participants in these communica-
tions failed to exercise care in speaking of pending matters;
to the contrary, the record shows that the trustee made this
concern clear, and the experienced trial judge is entitled to
this court's deference in that regard. Cf. D.D.C. R. 307(a)
(recognizing the propriety of "conferences in chambers" and
"other matters normally handled in camera").
Finally, appellants contend that, regardless of their access
to the sealed documents, at a minimum they should have been
notified (and should be notified in the future) of any docu-
ments submitted to the judge that relate to their pending civil
lawsuits. Specifically, they take issue with the absence of
personalized notice after the filing of the Second Interim
Report by the trustee. Although this report was not placed
under seal, they consider it to be an ex parte communication.
Due process, they contend, requires them to be given notice
of such submissions. Appellants are mistaken. Since these
submissions are open for public inspection, they do not create
the appearance of unfairness or bias that motivates concerns
over ex parte communications. Appellants may obtain copies
of these documents, as they already have done, and if they
conclude that the submissions are prejudicial to them in
concurrent lawsuits, appellants, represented by able counsel,
doubtless are aware of appropriate action that can be taken.
Admittedly, the burden of vigilance is on appellants, but due
process does not require that they be served with copies of
these documents or otherwise personally notified by the
judge. If it did, any other non-party whose interests could be
affected by a case would have the same right to personal
notice. The mere fact that appellants are engaged in concur-
rent civil litigation with the trustee does not differentiate
them in this regard from other interested parties. This claim
serves appellants no better than the others.
III.
Appellants alternatively contend that they are entitled to
inspect the sealed financial reports submitted by the trustee
because they are beneficiaries of the trust he administers.
According to the equitable principles of trust law, a "trustee
is under a duty to the beneficiary to give him upon his
request ... complete and accurate information as to the
nature and amount of the trust property." Restatement
(Second) of Trusts s 173 (1957). This requirement is de-
signed to ensure that the beneficiary receives any information
necessary to protect his rights under the trust. See id. s 173
cmt. c. Appellants maintain that, as shareholders in CCAH,
they (along with the United States government) are among
the ultimate beneficiaries of the trustee's sale of First Ameri-
can. Appellants and the other CCAH shareholders agreed to
transfer all of the interest in First American held by CCAH's
subsidiary, CCAI, to the trustee. The proceeds of the liqui-
dation of First American not attributable to BCCI's interest
in CCAH will be distributed to appellants in proportion to
their ownership interest in CCAH. Thus, they argue, the
trustee is holding their interest in First American in trust for
them as legal beneficiaries.
This contention fails for several reasons. If appellants
were beneficiaries of the trust, it would appear to be improp-
er for them to demand access to sealed court files. As they
readily concede, "the law of trusts typically would require a
beneficiary to seek access to the records of the trust from the
trustee, rather than the Court." Appellants contend, howev-
er, that their request is properly before the court because the
trustee, relying on the Procedural Order for support, has
already rejected their request. Still, appellants did not file a
motion to compel or a separate action for an accounting in
response to this rejection. Nor have appellants alleged any
wrongdoing on the part of the trustee, such as a breach of his
fiduciary duties, to support such an action. See, e.g., Strauss
v. Superior Court, 224 P.2d 726, 730-32 (Cal. 1950) (en
banc). Furthermore, even as beneficiaries of the trust, appel-
lants would not, presumably, be entitled to transcripts of the
in camera conferences.
Finally, as beneficiaries of the property administered by
the RICO trustee, appellants would not be entitled to access
to the sealed reports. By their own admission, they have
already received all of the financial information they would
require about the nature and amount of trust property. The
trustee has regularly filed quarterly reports pursuant to the
terms of his appointment and the Procedural Order, as well
as two interim reports, all of which are available to the public.
These reports contain statements of expenses, assets, and
liabilities of First American and summaries of the trustee's
efforts to sell First American's shares and assets. The sealed
reports, on the other hand, only contain information about the
financial reserves established by First American for claims
including appellants' indemnification claims, as well as esti-
mated expenses for handling those actions in the future.
Appellants concede that the financial reserves reflect the full
amount of those pending claims and therefore are already
known to them. As beneficiaries, moreover, appellants would
arguably have no right to view the "narratives" accompanying
the reserve figures since they do not relate to the "nature and
amount of the trust property." Restatement (Second) of
Trusts s 173.
Accordingly, finding no abuse of discretion by the district
court, we affirm the order denying access to certain sealed
material, transcripts of in camera conferences, and individu-
alized notice of future filings in the criminal proceeding.