Callahan v. Callahan
A court can grant an order to close a courtroom, to protect confidential business information from competitors, if no reasonable alternatives exist. The husband worked at Salomon Brothers until his mentor left and then decided to establish his own investment, trading and brokerage businesses, the Pentalpha entities, with the wife. In 1995, the husband owed 49 percent and served as the dealmaker. The wife owned 51 percent and served as the office manager. Previously, in May 2012, the court granted a dissolution of marriage and awarded the husband the Pentalpha entities, which the husband valued at $600,000, and the court valued at $11.7 million. The court ordered the husband to pay the wife $6 million or, if the husband sold the businesses within six months, to pay the wife 55 percent of the proceeds. The husband discovered that the wife, after the final hearing date, allegedly withdrew $632,722 in funds from the Pentalpha entities. The husband moved to open the judgment of dissolution and argued that the wife's alleged conduct negatively affected the valuation of the Pentalpha entities. Both parties expect to offer expert testimony on valuation. Evidence will probably include financial statements, ledgers and information about customers and proprietary software. The husband moved to close the courtroom, pursuant to Practice Book §11-20, to protect the Pentalpha companies' financial information from competitors. The wife objected and argued that the State of Connecticut favors open court processes. The wife did not offer evidence of particularized damages. The court found that keeping the courtroom open could provide inside information to competitors and other entities and could adversely affect sales price. The Pentalpha entities have confidentiality contracts with many customers. Customers may lose confidence in the Pentalpha entities, which could be exposed to legal responsibility for breach of contract. "The interests of the Pentalpha companies, and their clients," wrote the court, "override the public interest." No alternatives exist that are less restrictive. The court granted the husband's motion to close the courtroom.