Summary of Commission Practice Relating to Administrative Protective Orders, 42382-42388 [05-14481]

Agencies

• INTERNATIONAL TRADE COMMISSION

[Federal Register Volume 70, Number 140 (Friday, July 22, 2005)]
[Notices]
[Pages 42382-42388]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-14481]


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INTERNATIONAL TRADE COMMISSION


Summary of Commission Practice Relating to Administrative 
Protective Orders

AGENCY: U.S. International Trade Commission

ACTION: Summary of Commission practice relating to administrative 
protective orders.

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SUMMARY: Since February 1991, the U.S. International Trade Commission 
(``Commission'') has issued an annual report on the status of its 
practice with respect to violations of its administrative protective 
orders (``APOs'') in investigations under Title VII of the Tariff Act 
of 1930 in response to a direction contained in the Conference Report 
to the Customs and Trade Act of 1990. Over time, the Commission has 
added to its report discussions of APO breaches in Commission 
proceedings other than under Title VII and violations of the 
Commission's rules including the rule on bracketing business 
proprietary information (``BPI'') (the ``24-hour rule''), 19 CFR 
207.3(c). This notice provides a summary of investigations of breaches 
in proceedings under Title VII, section 421 of the Trade Act of 1974, 
as amended, and section 337 of the Tariff Act of 1930, as amended, 
completed during calendar year 2004. There were no completed 
investigations of 24-hour rule violations during that period, but there 
were two violations of Commission rule 210.34(d), the requirement that 
APO signatories inform the Commission in writing immediately upon 
learning that there has been a court order or discovery request for 
confidential business information (``CBI'') that has been released to 
signatories under an APO. The Commission intends that this report 
educate representatives of parties to Commission proceedings as to some 
specific types of APO breaches encountered by the Commission and the 
corresponding types of actions the Commission has taken.

FOR FURTHER INFORMATION CONTACT: Carol McCue Verratti, Esq., Office of 
the General Counsel, U.S. International Trade Commission, telephone 
(202) 205-3088. Hearing impaired individuals are advised that 
information on this matter can be obtained by contacting the 
Commission's TDD terminal at (202) 205-1810. General information 
concerning the Commission can also be obtained by accessing its 
Internet server (https://www.usitc.gov).

[[Page 42383]]


SUPPLEMENTARY INFORMATION: Representatives of parties to investigations 
conducted under Title VII of the Tariff Act of 1930, sections 202 and 
204 of the Trade Act of 1974, section 421 of the Trade Act of 1974, and 
seciton 337 of the Tariff Act of 1930, may enter into APOs that permit 
them, under strict conditions, to obtain access to BPI (Title VII) or 
confidential business information (``CBI'') (section 421, sections 201-
204, and section 337) of other parties. See 19 U.S.C. 1677f; 19 CFR 
207.7; 19 U.S.C. 2252(i); 19 U.S.C. 2451a(b)(3); 19 CFR 206.17; 19 
U.S.C. 1337(n); 19 CFR 210.5, 210.34. The discussion below describes 
APO breach investigations that the Commission has completed, including 
a description of actions taken in response to breaches. The discussion 
covers breach investigations completed during calendar year 2004.
    Since 1991, the Commission has published annually a summary of its 
actions in response to violations of Commission APOs and the 24-hour 
rule. See 56 FR 4846 (Feb. 6, 1991); 57 FR 12,335 (Apr. 9, 1992); 58 FR 
21,991 (Apr. 26, 1993); 59 FR 16,834 (Apr. 8, 1994); 60 FR 24,880 (May 
10, 1995); 61 FR 21,203 (May 9, 1996); 62 FR 13,164 (March 19, 1997); 
63 FR 25064 (May 6, 1998); 64 FR 23355 (April 30, 1999); 65 FR 30434 
(May 11, 2000); 66 FR 27685 (May 18, 2001); 67 FR 39425 (June 7, 2002); 
68 FR 28256 (May 23, 2003); 69 FR 29972 (May 26, 2004). This report 
does not provide an exhaustive list of conduct that will be deemed to 
be a breach of the Commission's APOs. APO breach inquiries are 
considered on a case-by-case basis.
    As part of the effort to educate practitioners about the 
Commission's current APO practice, the Commission Secretary issued in 
March 2005 a fourth edition of An Introduction to Administrative 
Protective Order Practice in Import Injury Investigation (Pub. No. 
3755). This document is available upon request from the Office of the 
Secretary, U.S. International Trade Commission, 500 E Street, SW., 
Washington, DC 20436, tel. (202) 205-2000 and on the Commission's Web 
site at https://www.usitc.gov.

1. In General

    The current APO form for antidumping and countervailing duty 
investigations, which was revised in March 2005, requires the applicant 
to swear that he or she will:
    (1) Not divulge any of the BPI obtained under this APO or otherwise 
obtained in this investigation and not otherwise available to him or 
her, to any person other than--
    (i) Personnel of the Commission concerned with the investigation,
    (ii) The person or agency from whom the BPI was obtained,
    (iii) A person whose application for disclosure of BPI under this 
APO has been granted by the Secretary, and
    (iv) Other persons such as paralegals and clerical staff, who (a) 
are employed or supervised by and under the direction and control of 
the authorized applicant or another authorized applicant in the same 
firm whose application has been granted; (b) have a need thereof in 
connection with the investigation; (c) are not involved in competitive 
decision making for an interested party which is a party to the 
investigation; and (d) have signed the acknowledgment for clerical 
personnel in the form attached hereto (the authorized applicant shall 
also sign such acknowledgment and will be deemed responsible for such 
persons' compliance with the APO);
    (2) Use such BPI solely for the purposes of the above-captioned 
Commission investigation or for judicial or binational panel review of 
such Commission investigation;
    (3) Not consult with any person not described in paragraph (1) 
concerning BPI disclosed under this APO or otherwise obtained in this 
investigation without first having received the written consent of the 
Secretary and the party or the representative of the party from whom 
such BPI was obtained;
    (4) Whenever materials (e.g., documents, computer disks, etc.) 
containing such BPI are not being used, store such material in a locked 
file cabinet, vault, safe, or other suitable container (N.B.: storage 
of BPI on so-called hard disk computer media is to be avoided, because 
mere erasure of data from such media may not irrecoverably destroy the 
BPI and may result in violation of paragraph C of the APO);
    (5) Serve all materials containing BPI disclosed under this APO as 
directed by the Secretary and pursuant to section 207.7(f) of the 
Commission's rules;
    (6) Transmit each document containing BPI disclosed under this APO:
    (i) With a cover sheet identifying the document as containing BPI,
    (ii) With all BPI enclosed in brackets and each page warning that 
the document contains BPI,
    (iii) If the document is to be filed by a deadline, with each page 
marked ``Bracketing of BPI not final for one business day after date of 
filing,'' and
    (iv) If by mail, within two envelopes, the inner one sealed and 
marked ``Business Proprietary Information--To be opened only by [name 
of recipient]'', and the outer one sealed and not marked as containing 
BPI;
    (7) Comply with the provisions of this APO and section 207.7 of the 
Commission's rules;
    (8) Make true and accurate representations in the authorized 
applicant's application and promptly notify the Secretary of any 
changes that occur after the submission of the application and that 
affect the representations made in the application (e.g., change in 
personnel assigned in the investigation);
    (9) Report promptly and confirm in writing to the Secretary any 
possible breach of the APO; and
    (10) Acknowledged that breach of the APO may subject the authorized 
applicant and other persons to such sanctions or other actions as the 
Commission deems appropriate, including the administrative sanctions 
and actions set out in this APO.
    The APO further provides that breach of an APO may subject an 
applicant to:
    (1) Disbarment from practice in any capacity before the Commission 
along with such person's partners, associates, employer, and employees, 
for up to seven years following publication of a determination that the 
order has been breached;
    (2) Referral to the United States Attorney;
    (3) In the case of an attorney, accountant, or other professional, 
referral to the ethics panel of the appropriate professional 
association;
    (4) Such other administrative sanctions as the Commission 
determines to be appropriate, including public release of or striking 
from the record any information or briefs submitted by, or on behalf 
of, such person or the party he represents; denial of further access to 
business proprietary information in the current or any future 
investigations before the Commission, and issuance of a public or 
private letter of reprimand; and
    (5) Such other actions; including but not limited to, a warning 
letter, as the Commission determines to be appropriate.
    APOs in investigations other than those under Title VII contain 
similar, thnough not identical, provisions.
    Commission employees are not signatories to the Commission's APOs 
and do not obtain access to BPI through APO procedures. Consequently, 
they are not subject to the requirements of the APO with respect to the 
handling of CBI and BPI. However, Commission employees are subject to 
strict statutory and regulatory constraints concerning BPI and CBI, and 
face potentially severe

[[Page 42384]]

penalties for noncompliance. See 18 U.S.C. 1905; Title 5, U.S. Code; 
and Commission personnel policies implementing the statutes. Although 
the Privacy Act (5 U.S.C. 552a) limits the Commission's authority to 
disclose any personnel action against agency employees, this should not 
lead the public to conclude that no such actions have been taken.
    An important provision of the Commission's Title VII and safeguard 
rules relating to BPI/CBI is the ``24-hour'' rule. This rule provides 
that parties have one business day after the deadline for filing 
documents containing BPI to file a public version of the document. The 
rule also permits changes to the bracketing of information in the 
proprietary version within this one-day period. No changes--other than 
changes in bracketing--may be made to the proprietary version. The rule 
was intended to reduce the incidence of APO breaches caused by 
inadequate bracketing and improper placement of BPI. The Commission 
urges parties to make use of the rule. If a party wishes to make 
changes to a document other than bracketing, such as typographical 
changes or other corrections, the party must ask for an extension of 
time to file an amended document pursuant to section 201.14(b)(2) of 
the Commission's rules.
    During 2004, the Commission found two violations of another 
Commission rule which applies to section 337 investigations 
exclusively. The rule, 19 CFR 210.34(d), requires APO signatories to 
report in writing to the Commission immediately upon learning that 
confidential business information disclosed to him or her pursuant to 
the protective order is the subject of a subpoena, court or 
administrative order (other than an order of a court reviewing a 
Commission decision), discovery agent, agreement, or other written 
request, agreement, or other written request seeking disclosure by him 
or any other person, of that confidential business information to 
persons who are not, or may not be permitted access to that information 
pursuant to either a Commission protective order or Commission rule 
210.5(b).

II. Investigations of Alleged APO Breaches

    Upon finding evidence of an APO breach or receiving information 
that there is a reason to believe one has occurred, the Commission 
Secretary notifies relevant offices in the agency that an APO breach 
investigation has commenced and that an APO breach investigation file 
has been opened. Upon receiving notification from the Secretary, the 
Office of the General Counsel (OGC) prepares a letter of inquiry to be 
sent to the possible breacher over the Secretary's signature to 
ascertain the possible breacher's views on whether a breach has 
occurred.\1\ If, after reviewing the response and other relevant 
information, the Commission determines that a breach has occurred, the 
Commission often issues a second letter asking the breacher to address 
the questions of mitigating circumstances and possible sanctions or 
other actions. The Commission then determines what action to take in 
response to the breach. In some cases, the Commission determines that 
although a breach has occurred, sanctions are not warranted, and 
therefore has found it unnecessary to issue a second letter concerning 
what sanctions might be appropriate. Instead, it issues a warning 
letter to the individual. A warning letter is not considered to be a 
sanction.
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    \1\ Procedures for inquiries to determine whether a prohibited 
act such as a breach has occurred and for imposing sanctions for 
violation of the provisions of a protective order issued during 
NAFTA panel or committee proceedings are set out in 19 CFR 207.100-
207.120. Those investigations are initially conducted by the 
Commission's Office of Unfair Import Investigations. During 2004, no 
investigation regarding a possible violation of a protective order 
issued during a NAFTA panel or committee proceeding was completed 
under those procedures.
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    Sanctions for APO violations serve two basic interests: (a) 
Preserving the confidence of submitters of BPI that the Commission is a 
reliable protector of BPI; and (b) disciplining breachers and deterring 
future violations. As the Conference Report to the Omnibus Trade and 
Competitiveness Act of 1988 observed, ``[T]he effective enforcement of 
limited disclosure under administrative protective order depends in 
part on the extent to which private parties have confidence that there 
are effective sanctions against violation.'' H.R. Conf. Rep. No. 576, 
100th Cong., 1st Sess. (1988).
    The Commission has worked to develop consistent jurisprudence, not 
only in determining whether a breach has occurred, but also in 
selecting an appropriate response. In determining the appropriate 
response, the Commission generally considers mitigating factors such as 
the unintentional nature of the breach, the lack of prior breaches 
committed by the breaching party, the corrective measures taken by the 
breaching party, and the promptness with which the breaching party 
reported the violation to the Commission. The Commission also considers 
aggravating circumstances, especially whether persons not under the APO 
actually read the BPI. The Commission considers whether there are prior 
breaches by the same person or persons in other investigations and 
multiple breaches by the same person or persons in the same 
investigation.
    The Commission's rules permit an economist or consultant to obtain 
access to BPI/CBI under the APO in a Title VII or safeguard 
investigation if the economist or consultant is under the direction and 
control of an attorney under the APO, or if the economist or consultant 
appears regularly before the Commission and represents an interested 
party who is a party to the investigation. 19 CFR 207.7(a)(3)(B) and 
(C); 19 CFR 206.17(a)(3)(B) and (C). Economists and consultants who 
obtain access to BPI/CBI under the APO under the direction and control 
of an attorney nonetheless remain individually responsible for 
complying with the APO. In appropriate circumstances, for example, an 
economist under the direction and control of an attorney may be held 
responsible for a breach of the APO by failing to redact APO 
information from a document that is subsequently filed with the 
Commission and served as a public document. This is so even though the 
attorney exercising direction or control over the economist or 
consultant may also be held responsible for the breach of the APO.
    The records of Commission investigations of alleged APO breaches in 
antidumpting and countervailing duty cases are not publicly available 
and are exempt from disclosure under the Freedom of Information Act, 5 
U.S.C. 552, section 135(b) of the Customs and Trade Act of 1990, and 19 
U.S.C. 1677f(g).
    The two types of breaches most frequently investigated by the 
Commission involve the APO's prohibition on the dissemination of BPI to 
unauthorized persons and the APO's requirement that the materials 
received under the APO be returned or destroyed and that a certificate 
be filed indicating which action was taken within a specified period 
after the termination of the investigation or any subsequent appeals of 
the Commission's determination. The dissemination of BPI usually occurs 
as the result of failure to delete BPI from public versions of 
documents filed with the Commission or transmission of proprietary 
versions of documents to unauthorized recipients. Other breaches have 
included: the failure to bracket properly BPI in proprietary documents 
filed with the Commission; the failure to report immediately known 
violations of an APO; and the failure to supervise

[[Page 42385]]

adequately non-legal personnel in the handling of BPI.
    Counsel participating in Title VII investigations have reported to 
the Commission potential breaches involving the electronic transmission 
of public versions of documents. In these cases, the document 
transmitted appears to be a public document with BPI omitted from 
brackets. However, the BPI is actually retrievable by manipulating 
codes in software. The Commission has found that the electronic 
transmission of a public document containing BPI in a recoverable form 
was a breach of the APO.
    The Commission advised in the preamble to the notice of proposed 
rulemaking in 1990 that it will permit authorized applicants a certain 
amount of discretion in choosing the most appropriate method of 
safeguarding the confidentiality of the BPI. However, the Commission 
cautioned authorized applicants that they would be held responsible for 
safeguarding the confidentiality of all BPI to which they are granted 
access and warned applicants about the potential hazards of storage on 
hard disk. The caution in that preamble is restated here:

    [T]he Commission suggests that certain safeguards would seem to 
be particularly useful. When storing business proprietary 
information on computer disks, for example, storage on floppy disks 
rather than hard disks is recommended, because deletion of 
information from a hard disk does not necessarily erase the 
information, which can often be retrieved using a utilities program. 
Further, use of business proprietary information on a computer with 
the capability to communicate with users outside the authorized 
applicant's office incurs the risk of unauthorized access to the 
information through such communication. If a computer malfunctions, 
all business proprietary information should be erased from the 
machine before it is removed from the authorized applicant's office 
for repair. While no safeguard program will insulate an authorized 
applicant from sanctions in the event of a breach of the 
administrative protective order, such a program may be a mitigating 
factor. Preamble to notice of proposed rulemaking, 55 FR 24,100, 
24,103 (June 14, 1990).

    In the past several years, the Commission completed APOB 
investigations which involved members of a law firm or consultants 
working with a firm who were granted access to APO materials by the 
firm although they were not APO signatories. In these cases, the firm 
and the person using the BPI mistakenly believed an APO application had 
been filed for that person. The Commission determined in all these 
cases that the person who was a non-signatory, and therefore did not 
agree to be bound by the APO, could not be found to have breached the 
APO. Action could be taken against these persons, however, under 
Commission rule 201.15 (19 CFR 201.15) for good cause shown. In all 
cases, the Commission decided that the non-signatory was a person who 
appeared regularly before the Commission and was aware of the 
requirements and limitations related to APO access and should have 
verified his or her APO status before obtaining access to and using the 
BPI. The Commission notes that section 201.15 may also be available to 
issue sanctions to attorneys or agents in different factual 
circumstances where they did not technically breach the APO but where 
their actions or inactions did not demonstrate diligent care of the APO 
materials even though they appeared regularly before the Commission and 
were aware of the importance the Commission placed on the care of APO 
materials. In 2004 there were two investigations where the Commission 
considered issuing sanctions to attorneys under section 201.15, but 
determined that there was not good cause. In one investigation the 
attorney had forwarded another party's public pre-hearing brief to his 
clients not knowing that the brief contained CBI. The Commission 
considered whether to issue sanctions against him for failure to 
retrieve the briefs even though he was found not to have breached the 
APO. The Commission considered mitigating circumstances and the fact 
that there were no provisions in the rules or the APO that would 
clarify the Commission's expectations and the attorney's responsibility 
under those circumstances. The Commission issued a letter warning the 
attorney and informing him that in the future he needed to be proactive 
regarding the care of BPI whether he receives it under the APO or from 
another source during the investigation. To prevent similar future 
occurrences such as this, the March 2005 version of the Title VII and 
safeguard APOs have added the requirement that the signatory not 
divulge any BPI or CBI disclosed under the APO ``or otherwise obtained 
in this investigation.''
    Also in recent years the Commission has found the lead attorney to 
be responsible for breaches where he or she failed to provide adequate 
supervision over the handling of BPI. Lead attorneys should be aware 
that their responsibilities for overall supervision of an 
investigation, when a breach has been caused by the actions of someone 
elese in the investgiation, may lead to a finding that the lead 
attorney has also violated the APO. The Commission has found that a 
lead attorney did not violate the APO in cases where his delegation of 
authority was reasonable. A prior breach by a subordinate attorney 
would suggest that delegation of authority to that attorney may not be 
reasonable.

III. Specific Investigation in Which Breaches Were Found

    The Commission presents the following case studies to educate user 
about the types of APO breaches found by the Commission. The studies 
provide the factual background, the actions taken by the Commission, 
and the factors considered by the Commission in determining the 
appropriate actions. The Commission has not included some of the 
specific facts in the descriptions of investigations where disclosure 
of such facts could reveal the identity of a particular breacher. Thus, 
in some cases, apparent inconsistencies in the facts set forth in this 
notice result from the Commission's inability to disclose particular 
facts more fully.
    Case 1. This APOB investigation involved four different law firms. 
The first two represented the same respondent in a Commission section 
337 investigation. A third firm represented the complainant in the 
section 337 investigation. A fourth firm had not been involved in the 
Commission's section 337 investigation and none of its attorneys were 
signatories to the APO, but it was representing the respondent in a 
multi-district court litigation (MDL) and in a related matter involving 
the issuance of subpoenas by another government agency. The Commission 
found that three attorneys from the first two law firms (respondent's 
firms) breached the APO in a section 337 investigation when they 
released APO materials to non-signatories of the APO while responding 
to subpoenas from another government agency and that they violated 
Commission rule 210.34(d) because they failed to notify the Commission 
of the subpoenas.
    The Commission found that a partner in the first law firm, who was 
also the lead attorney, breached the APO because he failed to prevent 
the production of certain APO documents to non-signatories by an 
attorney under his supervision. The Commission noted that the lead 
attorney was aware that the subpoenas had been issued and that they 
were seeking documents containing CBI obtained under the APO. In spite 
of this knowledge, there was no information provided in the APOB 
investigation suggesting that he took any action to prevent the release 
of the CIB

[[Page 42386]]

or to obtain permission from all of the sources of the CBI to release 
the materials. Because he did not notify the Commission in writing 
about these subpoenas, he violated rule 210.34(d).
    The second attorney in the first law firm and one attorney in the 
second law firm violated rule 210.34(d) by failing to notify the 
Commission in writing about the subpoenas and they breached the APO by 
releasing materials containing CBI obtained under the APO to attorneys 
in the fourth law firm with the knowledge that those documents would be 
released to the other government agency. The attorneys had argued that 
they did not breach the APO by releasing the CBI to the fourth law 
firms because attorneys in that firm could appropriately receive the 
information under the MDL protective order. The attorneys in the fourth 
law firm were representing their client in the MDL and the Commission's 
record had been cross designated by all the parties to the Commission's 
investigation. The attorneys in the first and second law firms also 
argued that they did not breach the Commission's APO because the court-
ordered protective order was controlling and that protective order 
permitted release of the documents pursuant to a government issued 
subpoena. The Commission rejected the attorneys' arguments that the MDL 
protective order was controlling and determined that the Commission's 
APO continued to apply the to the documents obtained under the APO in 
the Commission's section 337 investigation. Therefore, the attorneys 
were required to obtain permission to release the materials from all 
the sources of the CBI, which they did not do. In addition, the court-
issued protective order required that the person releasing the 
materials notify the sources of the CBI, which the attorneys also did 
not do.
    The Commission noted that the attorneys who released the materials 
to the fourth law firm had breached the APO because of their 
understanding and intent that the information would be released by the 
fourth law firm to the other government agency in response to the 
subpoenas. Although it would have been appropriate to give the 
materials to the fourth law firm for use in the MDL, it was a violation 
of the APO to give it to the firm for the purpose of releasing it to 
the other government agency. The Commission noted that it retained the 
authority to interpret its own APO and to determine whether or not 
cross-designation released the CBI from the Commission's APO 
jurisdiction. In addition, the Commission found that it was an 
aggravating circumstance that the attorneys who breached had taken 
actions based on their own interpretation of the APO rather than 
seeking advice from the Commission regarding the APO's jurisdiction 
over cross-designated material that were obtained under the 
Commission's APO.
    The Commission reached the decision to sanction the attorneys who 
breached with a private letter of reprimand rather than a warning 
letter after considering the mitigating circumstance that it was their 
first breach of a Commission APO, but noting the aggravating 
circumstances that they had also violated Commission rule 210.34(d) by 
not informing the Commission immediately of the government subpoena; 
that they made independent interpretations of the Commission's APO, 
without seeking advice from the Commission about whether it applied to 
their release of the CBI obtained under the Commission's APO; and that 
there is a presumption that at least one-signatory at the other 
government agency reviewed the CBI after it was given to the agency in 
response to the subpoenas.
    The Commission found that two attorneys in the first law firm also 
violated Commission rule 210.34(d) but, along with the remaining APO 
signatories at the first two firms, did not breach the APO. The two 
attorneys were issued warning letters for violating the rule. The 
Commission found that the attorneys from the third firm (complainant's 
law firm) did not breach the APO nor did they violate Commission rule 
210.34(d). The Commission also determined to take no action against 
attorneys in the fourth law firm because they were not signatories to 
the APO and, therefore, did not breach the APO when they passed the APO 
documents on to the government agency. In addition, since they did not 
practice before the Commission, and had no present intention to do so, 
the Commission determined that it would not use Commission rule 19 CFR 
201.15(a) to sanction them for their role in the release of the APO 
materials.
    Case 2. The Commission found that one attorney breached an APO by 
failing to bracket CBI on a page of an attachment in the confidential 
version of the prehearing brief filed with the Commission and to delete 
that CBI and other CBI that was bracketed and left on another page of 
the attachment to the public version of the brief. The Commission 
issued a private letter of reprimand. The Commission determined that 
two other attorneys from the same firm and a secretary did not breach 
the APO. The two other attorneys did not have final responsibility for 
preparation and review of the bracketing and the secretary did not have 
a direct role in the circumstances contributing to a breach.
    The attorney who breached the APO took immediate action to retrieve 
and replace copies of the page of the attachment containing unbracketed 
CBI but he failed to redact the bracketed information on another page 
of the attachment both in his original filing and in the replacement 
filing. He acknowledged his breach with regard to the CBI that had not 
been bracketed in the confidential brief but argued that the 
information left in brackets on a previous page of the attachment was 
not CBI because it was pricing data that was not company specific. The 
Commission did not accept this argument, noting that the data was in 
numerical form and that the Commission treats all questionnaire 
responses as CBI in their entirety unless the information is otherwise 
available from a public source, or is a non-numerical characterization 
of aggregate trends. The attorney also argued that the data were not 
CBI because release of the data would not impair the Commission's 
functions or cause substantial harm to the competitive position of the 
person, firm, corporation or other organization from which the 
information was obtained. The Commission rejected this argument also 
because disclosure of the pricing data would likely harm the 
Commission's ability to collect critical pricing data, since firms 
could become wary of providing the Commission with the pricing data in 
future investigations that are needed for the agency to perform its 
statutory functions.
    The Commission issued a private letter of reprimand after 
considering the mitigating circumstances: that this was his first 
breach and that the breach was inadvertent. In addition, his firm acted 
quickly to replace the last page of the public attachment containing 
the unbracketed CBI, and reeducated its personnel on APO practices and 
instituted new requirements to strengthen its APO procedures. The 
Commission noted two aggravating circumstances: (1) Non-signatories had 
read the CBI, and (2) the attorney twice failed to redact bracketed CBI 
from the public version of the brief and did not take corrective action 
with regard to that particular CBI. He was also ordered to retrieve and 
destroy any copies of the page containing the bracketed CBI and certify 
to the Commission Secretary that he had done so within thirty days.
    The Commission also found that there was not good cause for 
sanctioning an attorney in a different law firm for

[[Page 42387]]

failing to retrieve from his clients the public version of the pre-
hearing brief containing the bracketed and unbracketed CBI which had 
been served on him by the attorney in the first firm. He sent the brief 
to his clients, relying on the fact that the brief had been clearly 
marked as a public document. The Commission warned the attorney in the 
second firm that it would hold him accountable in the future if he 
failed to take a more proactive approach to protect CBI that comes 
under his control and he becomes aware that it is CBI.
    The attorney in the second firm had argued that he had not 
retrieved the brief because he had not received it under the APO. He 
stated that the attorney in the first firm had not asked him to 
retrieve and destroy the pages containing CBI and the Commission had 
not instructed him to do so. The attorney also raised questions about 
when he actually knew that the unbracketed and bracketed information 
was indeed CBI. Initially, the Commission had determined that he had 
not breached the APO because he did not know the brief contained CBI 
when he passed it along to his clients and he had not obtained the 
material under the APO.
    However, the Commission considered whether to sanction him under 
Commission rule 201.15 for his failure to safeguard the materials after 
he learned they contained CBI. In deciding to warn the attorney instead 
of sanctioning him, the Commission considered the facts that it was the 
first time he was subject to a possible sanction under section 201.15 
and that he had never breached an APO. In addition, he took prompt 
action to notify the Commission about the information in the brief that 
he later learned to be CBI, and the instructions given to him by the 
attorney in the first firm were not clear regarding retrieval and 
destruction of the pages containing CBI. Moreover, the Commission noted 
that its APO and rules did not explicitly address the need of the 
attorney in the second firm to take more active steps to safeguard CBI 
whether or not it was acquired by him through the APO directly or 
because of a breach committed by another party. In addition to the 
warning letter, the Commission ordered him to retrieve the copies of 
the brief and certify to the Commission that they were retrieved and 
destroyed. As noted earlier, the Commission has updated its rules to 
address this scenario.
    Case 3. The Commission determined that an attorney and a secretary 
breached the APO for failing to redact business proprietary information 
from the public version of a brief. The Commission issued a private 
letter of reprimand to the attorney who was responsible for the 
preparation of the public version of the brief but who failed to follow 
the law firm's procedures of reviewing the brief for BPI before filing 
it with the Commission and sending it to other parties and to the 
attorney's client. The Commission issued a private letter of reprimand, 
even though it was the attorney's client. The Commission issued a 
private letter of reprimand, even though it was the attorney's first 
breach, because a recipient of the brief who was not a signatory to the 
APO had read several pages of the brief which included BPI.
    The Commission found that the secretary, who had forgotten to run a 
computer program that would delete BPI from brackets in the brief, 
prepared the public version of the brief for filing with the 
Commission, yet failed to ensure that BPI had been completely deleted 
from the brackets. In reaching its decision on the appropriate 
sanction, the Commission considered the facts that (1) the BPI had been 
read by a non-signatory and (2) the secretary had previously breached 
an APO within the period generally examined by the Commission for 
purposes of determining sanctions. The Commission issued a private 
letter of reprimand with an additional requirement that the secretary, 
for one year, must certify with respect to any public version of a 
brief that he helped prepare, that he had inspected every page to 
ensure that all bracketed material had been removed.
    Case 4. The Commission determined that an attorney in one law firm 
had breached the APO by failing to destroy or return APO materials 
after the Commission's Section 337 investigation was terminated. In 
addition, the Commission found that the same attorney failed to comply 
with Commission rule 210.34(d)(1) by failing to notify the Commission 
immediately upon learning that requests for production of CBI obtained 
under the APO were made in a parallel district court litigation. The 
Commission issued a warning letter for the breach and for the rule 
violation.
    The Commission also determined that attorneys from a second law 
firm, representing the same client in the Commission investigation, did 
not breach the APO even though they did not return or destroy certain 
material obtained under the APO which contained a third party's CBI. 
The attorneys had entered into an agreement with the third party which 
allowed the attorneys to retain the material under the APO. They also 
retained material from another third party pending a response about 
whether to return or destroy the information. In response to a 
Commission inquiry about those documents, the attorneys responded that 
the third party had not marked any of those documents as containing CBI 
and there has been no further indication from the submitter that those 
documents contain CBI. The attorneys from this second law firm also 
indicated that they were not a part of the parallel litigation and, 
therefore, were not subject to any requests to produce CBI from the 
Commission investigation.
    In determining that the attorney from the first law firm did breach 
the APO for failure to return or destroy the APO materials, the 
Commission considered his argument that discovery requests in a 
parallel litigation barred his compliance with his APO obligations. The 
Commission found the argument not persuasive because APO obligations 
are mandatory--not conditioned by other court proceedings. In addition, 
the district court judge ultimately ruled on the discovery request and 
allowed production but with the CBI redacted. Therefore, continued 
retention of the CBI materials was not necessary for discovery 
purposes. The Commission also did not find compelling the argument that 
destruction of the documents could lead the factfinder in the parallel 
litigation to take a negative inference against the party destroying 
the documents. The Commission found that the fact finder may reject any 
adverse inference if the documents were destroyed for an ``innocent 
reason,'' and that the mandatory obligation to ``return or destroy'' in 
the Commission's APO establishes an ``innocent reason.'' Finally, in 
determining whether or not there was a breach, the Commission found 
unpersuasive the attorney's concern that APO compliance could lead to a 
violation under his state's rules of professional conduct.
    During the sanctions phase of the investigation, the Commission 
determined not to sanction the attorney but to issue him a warning 
letter for the breach and for the violation of Commission rule 
210.34(d). In reaching this conclusion, the Commission considered 
several mitigating circumstances including that CBI was not disclosed 
to any unauthorized persons and that the attorney had not previously 
breached a Commission APO. In addition, the Commission determined that, 
although it seemed unlikely that the attorney would be disciplined 
under his state's rules of professional conduct for an unlawful 
destruction of documents relevant to the court proceeding, there is no 
authority

[[Page 42388]]

addressing the issue in a definitive manner. Therefore, the Commission 
decided to acknowledge that a legitimate doubt remained for the 
attorney and treated his concern about his state's Bar rules as a 
mitigating factor.
    The Commission also considered several aggravating circumstances, 
including the long duration of the breach, the fact that the documents 
were not destroyed until the opposing counsel in the parallel 
litigation agreed, the fact that the attorney did not consider 
returning the documents to the source of the CBI rather than destroying 
the documents to avoid possible concerns about his state Bar rules, and 
the attorney's failure to seek Commission guidance and clarification of 
his ethical or discovery obligations from the district court.
    Case 5. The Commission found that one lead attorney breached the 
APO by failing to redact bracketed BPI from the public version of his 
firm's final comments in a Commission Title VII investigation. The 
Commission issued him a private letter of reprimand. The Commission 
found that none of the other attorneys or staff at the law firm 
breached the APO as none of them was involved in the incident or 
neglected any supervisory responsibilities leading to the breach.
    The attorney had argued that the unredacted information was not BPI 
because it involved data for more than three foreign producers, no one 
of whom accounted for more than 90 percent of the inventory ratio 
applicable to total cumulated shipments. The Commission found the data 
to be BPI because although similar data were treated as public in the 
preliminary staff report, the data had changed in such a way that 
certain foreign producers would be able to ascertain information about 
other producers using the earlier data that had been treated as public.
    The Commission reached its decision to issue a private letter of 
reprimand after consideration of the mitigating factors that the 
attorney's failure to redact the information was unintentional; that he 
had not been involved in any breaches in the two years preceding the 
breach; and that his firm had implemented new procedures in order to 
ensure that redacted documents would be reviewed by at least two 
separate individuals, including the senior attorney responsible for the 
submission. The Commission also considered aggravating factors that 
made the private letter of reprimand rather than a warning letter the 
more appropriate action. The Commission noted the attorney's 
acknowledgment that the unredacted information was made available to 
the public; his failure to take corrective measures, other than filing 
and serving a revised page, to limit the dissemination of BPI to non-
signatories and to ascertain whether the BPI had been read by non-
signatories; his conscious decision to waive internal firm procedures 
and forego review of the public version of the document by a second 
person; and the fact that the Secretary's Office and not anyone at his 
firm discovered the error.
    Case 6. The Commission found that one attorney and a legal 
assistant in one law firm and a legal assistant in another law firm 
breached the APO by failing to redact CBI from the public version of 
the administrative law judge's initial determination (ID) from a 
Commission 337 investigation which was attached to a claim construction 
brief in district court patent litigation. The Commission issued 
warning letters to all three after considering that none of them had 
breached an APO in the two-year period usually considered by the 
Commission in determining sanctions; the breach was unintentional; 
prompt action was taken to remedy the breach; and copies of the brief 
sent to three non-signatories were retrieved and the non-signatories 
stated that they did not review the CBI. There was one aggravating 
circumstance. The brief was available in the district court public file 
for a significant amount of time--one month--but based on the 
attorney's inquiries with the court, it appears that no unauthorized 
person actually viewed the CBI. The Commission determined that an 
attorney in the second law firm did not breach the APO as he was not 
involved in the preparation, filing, or distribution of the brief in 
court.
    Case 7. The Commission found that three attorneys breached an APO 
by filing a ``non-confidential'' version of their client's brief in the 
U.S. Court of Appeals for the Federal Circuit which contained CBI 
covered by the APO issued in a Commission section 337 investigation. 
One other attorney was found not to have breached because he did not 
help prepare the non confidential brief but, instead, took actions to 
prevent disclosure of the CBI to non-signatories.
    The Commission issued warning letters to the three attorneys. The 
circumstances of the breach were mitigated by the facts that none of 
the attorneys had breached an APO within the previous period typically 
considered by the Commission for the determination of sanctions, the 
breach was unintentional, the attorneys took prompt action to remedy 
the breach, and no non-signatory actually read the CBI.
    Case 8. The Commission found that one attorney and one paralegal 
breached the APO in a Commission title VII investigation by failing to 
redact BPI from the public version of a pre-hearing brief. The 
Commission issued warning letters to the attorney and paralegal. The 
circumstances of the breach were mitigated by the fact that this was 
the only breach in which either the attorney or paralegal was involved 
in the two-year period generally examined by the Commission for the 
purpose of determining sanctions; the breach was unintentional; prompt 
action was taken to remedy the breach; and actions were taken by the 
firm to improve APO compliance procedures. The lead attorney was found 
not to have breached because he was out of the country and did not 
participate in the preparation of the prehearing briefs and because he 
has reasonably delegated the responsibility to another attorney who had 
no prior breaches. The Commission did not consider as a mitigating 
circumstance the attorney's argument that the unredacted BPI was not 
highly sensitive proprietary information.
    Rule Violations--In two section 337 investigations, the Commission 
found that attorneys had failed to notify the Commission in writing 
immediately upon learning that CBI disclosed to the attorney pursuant 
to an APO was the subject of a ``subpoena, court or administrative 
order (other than an order of a court reviewing a Commission decision), 
discovery request, agreement, or other written request seeking 
disclosure, by him or any other person, of that CBI to persons who are 
not, or may not be, permitted access to that information pursuant to 
either a Commission protective order or [19 CFR] 210.5(b).'' In both 
cases the Commission issued warnings to the attorneys. Discussions of 
these rule violations can be found in the summaries of Cases 1 and 4 
above.

    Issued: July 18, 2005.

    By order of the Commission.
Marilyn R. Abbott,
Secretary to the Commission.
[FR Doc. 05-14481 Filed 7-21-05; 8:45 am]
BILLING CODE 7020-02-M