[Federal Register Volume 64, Number 83 (Friday, April 30, 1999)]
[Notices]
[Pages 23355-23358]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10871]
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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 Title VII and violations of the Commission's
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 Title VII investigations for the period
ending December 31, 1998. There were no investigations of breaches for
other Commission proceedings or for 24-hour rule violations during that
period. 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 (http://www.usitc.gov).
SUPPLEMENTARY INFORMATION: Representatives of parties to investigations
conducted under Title VII of the Tariff Act of 1930 may enter into APOs
that permit them, under strict conditions, to obtain access to BPI of
other parties. See 19 U.S.C. 1677f; 19 CFR 207.7. 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
1998.
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 12335 (Apr. 9, 1992); 58 FR
21991 (Apr. 26, 1993); 59 FR 16834 (Apr. 8, 1994); 60 FR 24880 (May 10,
1995); 61 FR 21203 (May 9, 1996); 62 FR 13164 (March 19, 1997); 63 FR
25064 (May 6, 1998). This report does not provide an exclusive 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
April 1996 a revised edition of An Introduction to Administrative
Protective Order Practice in Antidumping and Countervailing Duty
Investigations (Pub. No. 2961). 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.
I. In General
The current APO form for antidumping and countervailing duty
investigations, which the Commission has used since March 1995,
requires the applicant to swear that he or she will:
(1) Not divulge any of the BPI obtained under the APO and not
otherwise available to him, 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
decisionmaking for the interested party which is a party to the
investigation; and (d) have submitted to the Secretary a signed
Acknowledgment for Clerical Personnel in the form attached hereto (the
authorized applicant shall 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 Commission
investigation [or for binational panel review of such Commission
investigation or until superceded by a judicial protective order in a
judicial review of the proceeding];
(3) Not consult with any person not described in paragraph (1)
concerning BPI disclosed under this APO 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 such 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 provision 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 to the investigation);
(9) Report promptly and confirm in writing to the Secretary any
possible breach of the APO; and
(10) Acknowledge that breach of the APO may subject the authorized
applicant and other persons to such sanctions or other actions as the
Commission deems appropriate
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including the administrative sanctions and actions set out in this APO.
The APO further provides that breach of protective order 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.
Commission employees are not signatories to the Commission's APOs
and do not obtain access to BPI through APO procedure. Consequently,
they are not subject to the requirements of the APO with respect to the
handling of BPI. However, Commission employees are subject to strict
statutory and regulatory constraints concerning BPI, and face
potentially severe 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 rules relating to BPI 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 amendment document pursuant to
section 201.14(b)(2) of the Commission's rules.
II. Investigations of Alleged APO Breaches
Upon finding evidence of a 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 file has been opened. Upon receiving notification from
the Secretary, the Office of General Counsel (OGC) begins to
investigate the matter. The OGC prepares a letter of inquiry to be sent
to the alleged breacher over the Secretary's signature to ascertain the
alleged breacher's views on whether a breach has occurred. 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 or aggravating 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 has determined 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. The Commission retains sole authority to
determine whether a breach has occurred and, if so, the appropriate
action to be taken.
The records of Commission investigations of alleged APO breaches in
antidumping 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 breach most frequently investigated by the Commission involves
the APO's prohibition on the dissemination of BPI to unauthorized
persons. Such dissemination 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 properly
bracket BPI in proprietary documents filed with the Commission; the
failure to immediately report known violations of an APO; and the
failure to adequately supervise non-legal personnel in the handling of
BPI.
Sanctions for APO violations serve two basic interests: (a)
Preserving the confidence of submitters of BPI in the Commission as 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, ``the 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. 623 (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 within the previous two-year period and multiple breaches by
the same person or persons in the same investigation.
The Commission's rules permit economists or consultants to obtain
access to BPI under the APO 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). Economists and consultants who obtain access to
BPI 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
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consultant may also be held responsible for the breach of the APO.
III. Specific Investigations in Which Breaches Were Found
The Commission presents the following case studies to educate users
about the types of APO breaches found by the Commission. The case
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--Counsel in an investigation notified the Commission that
they were unable to locate certain documents containing BPI which were
obtained under the Commission's APO. Counsel presumed that the
documents had been intentionally discarded by a discharged clerical
employee. Counsel instructed an office manager who was not subject to
the APO to review certain APO documents in the possession of an
attorney covered by the APO to identify the missing documents. The
Commission determined that three attorneys breached the APO by failing
to properly safeguard materials under the APO and to prevent the
disclosure of BPI to unauthorized persons. The attorney who had signed
the acknowledgments for clerical personnel breached the APO because, as
the person responsible for ensuring that the fired employee complied
with the APO, he failed to safeguard the documents. In addition, he and
a second attorney breached the APO when they instructed an employee not
covered by the APO to review copies of APO documents of a third
attorney to determine which documents were missing. The third attorney
was found to breach the APO by permitting the employee not covered by
the APO to review the documents in his possession. The Commission
issued private letters of reprimand to all three attorneys. Certain
aggravating factors existed with regard to the breach involving the
disposal of the documents. The clerical employee apparently committed
an intentional breach of the APO; efforts to identify and recover the
documents were not effective; a large volume of the APO information was
involved; and since the fate of the materials will likely never be
known, it is impossible to determine whether they have been reviewed by
any person not subject to the APO. There were also mitigating factors
in that the attorney responsible for supervising the breaching clerical
worker had no prior breaches; the breach was reported shortly after
counsel became aware of it; and steps were taken to identify and
recover the missing documents.
All three attorneys were found to have committed the second breach,
i.e., the direction to an individual not covered by the APO to review
APO documents and the release of those APO documents to that
individual. Two aggravating circumstances were that the Commission, not
the attorneys, discovered the breach, and the BPI was viewed by an
unauthorized person. The Commission also considered as mitigating
factors that this breach was inadvertent and the attorneys involved had
no prior breaches.
Case 2--Counsel in an investigation filed with the Commission a
proprietary version of a submission which contained unbracketed BPI and
filed the public version of the document without deleting the
unbracketed BPI. Counsel became aware of the potential breach, notified
the Commission and the parties to the investigation, and retrieved and
destroyed all copies of the offending document. The Commission
determined that three attorneys breached the APO by failing to bracket
BPI in the proprietary version of the document and by failing to delete
that BPI from the public version. In reaching its decision to issue
warning letters, the Commission considered that this was the only
breach in which these attorneys were involved in the prior two-year
period generally examined by the Commission for purposes of considering
sanctions, the breach was unintentional, and counsel promptly notified
the Commission of the breach and took action to remedy it. There was no
information in the record suggesting that any non-APO signatories had
viewed the BPI. The Commission determined that two attorneys did not
breach the APO because they were not responsible for drafting the
section of the document containing the unbracketed BPI or for reviewing
the document for BPI or proper bracketing.
Case 3--Counsel filed a public version of a document which
contained unredacted BPI. The document was prepared by economists at an
economic consulting firm which had an arrangement with the law firm to
assure that documents they prepared would go through three levels of
review for APO compliance. The consulting firm was responsible for the
first two levels of review and the law firm was responsible for the
final APO review of all materials prepared by the consulting firm.
Those responsible for the reviews failed to notice the offending
information. The potential breach was identified by the Commission
Secretary, who notified an attorney with the law firm who took
immediate action to retrieve the offending documents. In response to
the Commission inquiry, the law firm asserted that no breach occurred
because the bracketed information which was not deleted was publicly
available from other sources and was a non-numerical characterization
of the prices of one producer which is generally allowed to be publicly
disclosed under Commission rules. The Commission did not agree with the
law firm's assertions and determined that the APO had been breached
because the information was derived from a questionnaire response which
is always treated as confidential in its entirety. Further, the
information was not available from a public source at the time that it
was revealed and was not a non-numerical characterization of aggregate
trends as provided for in the Commission rules.
The Commission found that the two economists and two attorneys who
were responsible for the final APO review of the submission breached
the APO. In issuing warning letters to the two economists and two
attorneys, the Commission considered the mitigating factors that the
breach was unintentional, resulting from a collective oversight on the
part of the economists and the attorneys. The law firm took prompt
corrective action as soon as it learned of the breach, and all copies
of the offending document were retrieved or destroyed. There was no
evidence that persons not subject to the APO actually reviewed the
document in question. In reaching its decision, the Commission also
considered the aggravating factor that the potential breach was first
identified by the Commission Secretary.
The Commission did not find the lead attorney responsible because
he had delegated the responsibility for performing the final APO review
of the public version of the brief to associates who were experienced
in such tasks. Thus, this does not appear to be a case of negligent
supervision. In addition, the Commission did not hold responsible for
the breach one economist, a legal assistant, and a secretary who were
on the APO because they did not have responsibility for the preparation
or review of the document.
Case 4--Counsel in an investigation distributed a document which
contained unbracketed BPI. The BPI at
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issue was contained in a questionnaire response. The potential breach
was brought to counsel's attention by an attorney representing another
party to the investigation. Counsel immediately informed the Secretary
of the potential breach and supervised efforts by law firm personnel to
retrieve copies of the document from those who had access to it. Many,
but not all, of the copies of the document were retrieved. In
responding to the Commission inquiry, counsel asserted that the
information was publicly available and that the information was
``innocuous'' and not BPI because it revealed nothing about the
substance of the questionnaire response. The Commission was not
persuaded by counsel's assertions and determined that the APO had been
breached because questionnaire responses are treated as confidential in
their entirety unless the responses contain information that is
otherwise publicly available. The Commission determined that the
economist responsible for preparing the document and the attorney
charged with final APO review of materials breached the APO by
circulating the document which contained BPI. In issuing private
letters of reprimand, the Commission considered the facts that the
decision by the attorney and the economist not to bracket and delete
the BPI at issue was not inadvertent, the breach was first identified
by counsel for another party, and the attorney and economist were
unable to account for numerous copies of the document at issue which
may remain in the hands of parties not covered by the APO. In reaching
its determination, the Commission also considered the mitigating
factors that neither the attorney nor the economist had previously
breached an APO, and the attorney reported the breach promptly after
learning of it.
Case 5--Counsel in an investigation filed a public version of a
document containing bracketed but unredacted BPI in footnotes. The
information in question was submitted in a questionnaire response and
was not publicly available at the time it was revealed in the public
version of the document. The Commission Secretary discovered the
possible breach and advised counsel, who took prompt measures to
retrieve all copies of the relevant document. Although one party not
entitled to access to BPI received a copy of the document, there is no
evidence that that person actually reviewed the unredacted BPI.
The Commission determined that the attorney responsible for
reviewing the document to assure APO compliance had breached the APO by
failing to redact bracketed BPI from a public submission. The lead
attorney and two paralegals were not found responsible for the breach
because the sole responsibility for assuring APO compliance was
delegated to the non-lead attorney who was experienced in such matters.
In reaching its determination to issue a warning letter, the Commission
considered the mitigating factors that this was the attorney's first
breach of an APO, the breach was inadvertent, and the attorney took
immediate action to retrieve the document in question apparently before
any non-signatory to the APO reviewed the BPI at issue. The Commission
considered as an aggravating factor the fact that it was the Commission
Secretary who discovered the breach.
IV. Investigation in Which No Breach Was Found
During 1998, the Commission completed one investigation in which no
breach was found. An attorney attempted to discuss information
protected under the APO with a person not on the APO. The Commission
determined that the attorney did not breach the APO because the
information revealed was inaccurate and was not the information
protected under the APO. In advising the attorney that he had not
breached the APO on technical grounds, the Commission urged him to
exercise greater caution in the future.
Issued: April 27, 1999.
By order of the Commission.
Donna R. Koehnke,
Secretary.
[FR Doc. 99-10871 Filed 4-29-99; 8:45 am]
BILLING CODE 7020-02-P
