The ABA Journal has the background here:
A new corporate arbitration program hosted by what many consider the nation’s top business court violates the U.S. Constitution by holding “secret” judicial proceedings, contends a lawsuit that was filed today in federal court in Wilmington, Del., by the Delaware Coalition for Open Government Inc.
Naming all five justices of the state’s chancery court as defendants, along with the state and chancery court, the suit contends the arbitration program is so similar to traditional courtroom litigation that it is unconstitutional not to have it take place on the record, according to Bloomberg and the Wilmington News Journal.
The complaint was filed yesterday by the Delaware Coalition for Open Government, Inc., in the federal district court in Delaware. It essentially alleges that an arbitration under these rules violates the First and Fourteenth amendments and the Civil Rights Act because the documents are confidential and not part of a public record or docketing system. As the complaint says: “Although the statute and rules call the procedure ‘arbitration,’ it is really litigation under another name.”
Can this be? I ask not as a constitutional scholar, but because I think our court system already facilitates private negotiated contract in some ways, including using public judges to settle cases. Delaware is unusual in the extent to which it is developing a service that competes with private arbitration services, but other courts have integrated arbitration and mediation into their court system, including into specialized business courts. A difference in kind or degree?
Here is the complaint.
19. 10 Del. C. §349 and Chancery Court Rules 96, 97 and 98 deny plaintiffs, and the general public, their right of access to judicial proceedings and records. Although the statute and rules call the procedure “arbitration,” it is really litigation under another name. Although procedure may vary slightly, the parties still examine witnesses before and present evidence to the Arbitrator (a sitting judge), who makes findings of fact, interprets the applicable law and applies the law to the facts, and then awards relief which may be enforced as any other court judgment. The only difference is that now these procedures and rulings occur behind closed doors instead of in open court.
20. The defendants’ actions, under color of State law, constitute an unlawful deprivation of the public’s right of access to trials in violation of the First Amendment as applied to the states by the Fourteenth Amendment to the United States Constitution.
Originally, the common law courts came into being as a form of competition with the Kings equity courts (courts of chancellory). In Delaware there is still a divide between courts of law (common law courts) and the courts of equity (courts of chancery). Funny how things repeat.