*1 lessee, disadvantaged meaning it would be lessors includes the of economic ad- vantage competitor. to a paid knew what it elsewhere. We now find prove West failed to that release of the the trial court is The record made before give information advantage would an not as clear as these contentions. competitors 22.7(6). required in section sought buildings information involves in Colorado and Nebraska. The located We also find that it would serve a intervenor’s affidavit indicates all six build- public purpose to reveal information to the ings years in the have been sold last two public might perceived be as West’s or its affiliates and leased back West self-dealing to favor stockholders over rate protect long-term leases in an effort payers. We hold that West did not estab ratepayers’ expense. stockholders at the exemption pursuant lish an to section 22.- testimony by affidavits and West 7(6). While however, unequivocally, We state opin- subsidiary employees provide and its that we have neither been called concerning ions the deleterious effects dis- determine whether orWest its affiliates affiliates, or closure will have West engaged conduct, wrongful have nor do self-serving such evidence is and does not express any opinion we concerning this contain hard facts. matter. public’s We conclude the examination of the properly information concerning provided West no evidence public purpose. serves a buildings, the number of tenants outsiders, percentage buildings rented to III. Summary. summary, In find we rates, occupancy or West’s own needs that West and its affiliates have failed to concerning space. leasing While reference proof meet their burden of to establish an competitors, vague is made to the record is exemption confidentiality based under concerning advantage the extent of the 22.7(3) (6). either Any subsections mat- provide competitors. lease information will concerning stay ters bonds filed to the in- We are uncertain whether West or its sub- junction during appeal must addressed major players competi- sidiaries are in the by the district court. leasing tive real-estate market or whether AFFIRMED. leasing most of its is between affiliates.
Furthermore, question credibility expressed competitors concern about gaining
and lessees If in this information.
fact the sales and leases are in-house trans- parent actions subsidiary between com- MADSEN, Larry Appellee, D. panies arms-length rather than transac- tions, we believe the information would be INDUSTRIES, INC., competitors. of little use to West’s The LITTON and Litton Systems, was on burden West and its subsidiaries to Automations Industrial Inc., Appellants, prove that a disclosure of the lease and put sales information West at an would disadvantage. economic In our de novo Palletizers, Inc., Lit- review, we conclude has failed to West ton Inc. d/b/a Consequently, meet this burden. West Palletizers, Defendants. failed to establish its entitlement to an No. 91-1958. 22.7(3). exemption pursuant to section Supreme of Iowa. Court competitors II. Advantage to public purpose. Reports governmental April 1993. agencies kept are to be confidential if it Rehearing As on Denial of Revised demonstrated that release information May 1993. give advantage competitors would an Rehearing May Denied 22.7(6). public purpose. and serve no § division, preceding we found didWest prove not meet its burden to that the lease value,”
information has “economic a term
LARSON, Justice.
Larry injured by a ma- D. Madsen was palletizer chine as manufactured known Industries, defendants, sold Litton and Sys- Inc. and Litton Industrial Automations tems, petition Inc. in Linn Madsen filed a County Court and served District When de- notices on the defendants. appear, fendants failed to a default against ment was entered them. The de- fendants, collectively refer to whom will Litton, moved set aside default of under Rule Procedure 236. Iowa Civil relief, The district court denied and appeals of We affirm the affirmed. and appeals court of the district court. support and The affidavits filed in to set resistance to motion aside following Mad- default establish facts. sen’s accident occurred on December In Madsen’s attor- November ney wrote to “Litton Palletizers” Alabama, notifying his Montgomery, it of Although intention make a claim. Litton legal entity is not a Palletizers itself, brought to atten- the letter was Hilinski, was Litton’s tion John systems office counsel in its automation Kentucky. Litton Automation Industrial actually had Systems entity is the palletizer. Litton Auto- manufactured wholly subsidiary mation owned Inc. the Hartford Insurance Hilinski notified claim, Company and Hartford of Madsen’s attorney that in turn Madsen’s notified investigate matter. Hartford would Litton’s associate Hilinski also advised Estabrook, H. litigation, director Steven claim. Estabrook’s office of Madsen corporate located at the Litton Industries Hills, headquarters California. responsible directly Estabrook for Margaret litigation by all supervision Calla- and Mark McCormick C. Belin, Harris, Beverly Hills, han Lamson & McCor- Litton. mick, P.C., Moines, Des Donald G. comprised of litigation department was P.C., Riley, Thompson Bradley & Cedar attorneys mem- four Rapids, appellants. liability are product claims bers. When involved, Litton, according to co- Hartford Bobenhouse, Rapids, E. James Cedar coop- Rapids, adjustment of claims in Beverly Ogren, appellee. Cedar ordinates the corporate manag- risk Claiser, eration with Litton’s First Nat’l Bank v. (Iowa 1981)
er. (emphasis added). Estabrook, H. Steven 12, 1990, Litton’s associate On December Madsen’s attor- litigation, director of Bobenhouse, stated his affidavit ney, wrote to James Hartford that he first learned of the Madsen claim in say that a had been filed. A *3 stated, November 1989. copy petition Customarily, he of the was enclosed. Boben- opened “claim file” original prior litiga- is to house advised Hartford no- actual permit tion litigation department served on Litton if to tices would be settle- progress ment was not reached “track the of within two weeks.' the claim.” He felt settled, The claim was not and Bobenhouse that this case would not settle in the claim began process. stage of litigation service and that was imminent. His affidavit continued: original by Three notices were served Therefore, 23, 1991,1 January opened first, February The Bobenhouse. Litigation Department “claim file.” Vongal was served on “Litton Palle- However, the erroneously file was as- Montgomery, tizers” in Al- Alabama. signed “litigation an active file” num- though entity there is no such as Litton ber—rather than a “claim file” number. Palletizers, palletizers Litton’s are Claim numbers commence with L-8 Montgomery, Alabama, made in and the by (i.e., L-8001), digits followed three original notice served on Litton and active file numbers com- Attorney Palletizers was sent to Hilinski mence with L-2 digits followed three Hebron, Kentucky, office. The (i.e., Lr-2001). served, second notice was on March Sys- on Litton Industrial Automation original Litton concedes that the no tems, Hebron, Kentucky. Inc. in This no- Beverly tice served on the Hills office was brought tice also to the attention of “mistakenly” handled its staff. It original A Hilinski. third notice on March attempts to shift the blame for the result 27, 1991, directly was served on Litton at default, however, ing to Hartford because headquarters Beverly Hills, Califor- Hartford had not notified Litton that a nia. negli was on file. The insurer’s gence, claims, may “imputed” Litton appear, failed to and the court problem argument to Litton. The with this judgment against entered a default it. Lit- ton is that there can be no default until an moved to set aside the default under served, original Iowa Rule of Civil notice has been and Hart Procedure 236: way knowing ford had no of of the service shown, On motion and for cause original of the notices in this case. Litton pre- such terms as the court simply failed to tell Hartford that it had scribes, parte, but not ex may original been served with the notices. set judgment aside default or the there- on, mistake, inadvertence, surprise, party A seeking to set aside a de neglect or unavoidable casual- judgment par fault on the basis that the ty. Such promptly motion must be filed ty’s insurance carrier was at fault must discovery after grounds there- party show that the the suit forwarded of, sixty but not more days than after papers to the insurer or informed the insur entry judgment. of filing Its er in way some other that action on behalf finality shall not affect the of judg- necessary prevent the defendant was impair operation. ment or Annotation, generally default. See Fail If a district court refuses to set aside a Insurer, Liability ure After Notifica default, here, as it did tion, Insured, Against Suit Defend Warranting can Opening Against interfere with the court’s deter- In [w]e Default evidentiary insufficiency mination of sured on Ex only Ground Inadvertence or if find the evidence is so Neglect, overwhelm- cusable 87 A.L.R.2d 872-73 (1963). case, that the carried notify their bur- Litton did not [movant] proof
den of
as a matter
law.
Hartford that Litton had
served. The
been
ignoring a file for
negligence in
Hartford,
any,
not the
have found
negligence of
months, regardless
There
its label
the default.
what
cause of
primary
that,
trial
evidence
the fact
substantial
said. This
illustrated
negligence on
finding
primary
court’s
before the default
well over month
part
Litton.
ment, Hartford Insurance advised Esta-
attorney
Madsen’s
had made
brook that
on Litton’s
original
notice served
$30,000.
Hartford asked Esta-
demand
stamped
Es-
office was
Hills
file,
but Estabrook
brook to review
placed in the
name and
tabrook’s
had, he
re-
do
If he
would have
The two notices
failed to
so.
Madsen
file.
Hebron, Kentucky,
office
by Litton’s
time
ceived
discovered
any re-
in a file without
placed
judgment.
were also
avoid the default
lawyer
any
made
contact
Neither
sponse.
*4
that Lit-
the district court found
Because
company, filed an
insurance
with Litton’s
inadequate to sustain
ton’s affidavits were
answer, or retained outside
appearance or
236,
under rule
and substantial
its burden
Hilinski,
Kentucky attor-
Litton’s
counsel.
supports
findings,
those
we must
evidence
Estabrook,
inform
at the
ney, did not even
of Litton’s motion.
affirm the denial
See
of-
headquarters,
that Hilinski’s
corporate
Claiser,
There are additional facts that
filed his
facts. Madsen
lawsuit
that
the district court’s conclusion
well Litton
Inc. and
subsidiaries
cause was not shown. The court could
professionals
prolonged Many
present-
after a
trained
were
on December
attempt
his claim with Litton’s
knowledge
pendency
to settle
ed with
Hartford Insurance Com-
insurance carrier
this
No one
lawsuit.
took
initiative
letter,
dated
pany. Madsen’s
December
to communicate. There should have
representative
ad-
Hartford’s
confusion
been no
and it
reasonable
vising
the insurance carrier that a
expect
that out
of all of
various
had been filed Madsen was not dissemi-
involved,
people
someone would have
subsidiaries,
nated either to Litton
steps
inquiry
taken reasonable
make
supervisor.
or Hartford’s senior claims
pendency
about the
of the lawsuit and its
discussing
After
the Madsen claim
Nevertheless,
status.
no one chose to do
supervisor, attor-
Hartford’s senior claims
so.
ney
litigation depart-
Litton’s
Estabrook of
Appeals
The Iowa Court of
stated: “In
Hills, California,
opened,
ment in
in general
appear
the failure to
was caused
January
on the claim. The file
file
organization,
lack
a lack of coordi-
mistakenly
as a
labeled
nation
a lack
of communication. We
regarding
opening
a memo
not find
do
these factors constitute
attorney
file was
circulated
Hilinski
”
‘good
opinion
The majority
sug-
cause.’
subsidiary Kentucky.
Hi-
When
gests
finding
district court’s
that
linski received the Madsen
notices
*5
negligent supports
Litton was
the conclu-
February
in
served
Litton’s subsidiaries
good
sion that Litton had failed to show
1991,
March
he
mat-
and
assumed these
cause.
being
and
ters were
handled
Estabrook
I
the record
believe
establishes
1991,
27,
no action was taken. On March
appear
failure of Litton to
and defend was
office
accepted
an
administrator
service
the result of mistake
excusable ne-
and
notice on Litton in California
glect.
appellate
The district court and
placed
and
and
in the
notice
agree
mislabeling
courts
Madsen
calling
Madsen file without
claim
was a mistake. Excusable
file
ne-
Estabrook’s attention. Default
taken
glect
encompass
is understood to
situations
against
Madsen
Litton on
and
April 27
filing
failure
a
comply
which the
with
against
subsidiary on
De-
May
9.
negligence
deadline is
or
attributable to
judgment
$137,173.75
fault
in the sum of
Whitehorn,
854;
at
fault.
see
was entered
the defendants on
Inv.
v. Brunswick
also Pioneer
Servs. Co.
19, 1991.
June
—
-,
Partnership,
U.S.
Assocs. Ltd.
undisputed
These additional facts are
(1993)(“ex-
123
113 S.Ct.
L.Ed.2d 74
May
record.
On
re-
Estabrook
neglect”
bankruptcy
defined under
cusable
letter,
May 13,
a
ceived
dated
from Hart-
9006(b)(1)
Federal
rule
and as used in
Rule
asking
ford
that he review the Madsen file.
(60)(b)).
of Civil Procedure
requested
Estabrook
secretary
his
to locate
recognized
file. The
him Many years ago
file was not delivered to
our
he left
may
before
for San Francisco where he
system
fail as a result of mistake
during
remained
first
Kincaid,
three weeks
force.
181
Reilley
the office
v.
June. He was advised of the default
(1919). In Reilley,
Iowa
pers properly preserved Steve approaches and and if a term of court as require his he the matters lists and Iowa Industrial Iowa STATE therein, of a misplacement attention Commissioner, Appellants. him, fault on paper file leads without necessity an No. 92-254. part, his to overlook he appearance in new case with which Supreme Iowa. Court of familiar, thoroughly yet has not become chargeable April held with ought he not to be so caused is his failure negligence, and negli- imputed to his client
not to be moreover, is, rule
gence.... It perfect har- fairness and in
reason and courts
mony purposes for which justice are and maintained. established N.W. at 83. at
Reilley, Iowa reasonably rely for Litton could
Counsel receiving system for and han-
on the office
dling as a means of original notices avoid- re- judgment. Estabrook a default
quested opened. He did not a claim file be filed. Hi-
know Madsen suit been persons
linski other reasonably
believed the Madsen *6 If
and that Estabrook was it. negligent, it
their conduct was careless under the circumstances.
Here, involving inas most cases rule findings of fact court makes based pleadings and affidavits filed case, parties. in this most As state- included in the affidavits are not
ments
disputed. question then becomes what can drawn from the undis-
conclusions disputed
puted facts and the facts that the Here,
court the district finds believable.
court concluded that Litton failed “good cause.” This is a find-
establish of fact but is a conclusion drawn
from facts. should not be We bound
by the district court conclusion that inadequate. were I would vacate
affidavits appeals
the court of decision reverse ruling. district
NEUMAN, J., joins this dissent.