[Federal Register Volume 59, Number 68 (Friday, April 8, 1994)]
[Unknown Section]
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From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-8472]
[[Page Unknown]]
[Federal Register: April 8, 1994]
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INTERNATIONAL TRADE COMMISSION
International Trade 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: This notice provides a summary by the U.S. International Trade
Commission (Commission) of its investigations of breaches of
administrative protective orders (APOs) issued in connection with
investigations under Title VII and section 337 of the Tariff Act of
1930.
This notice is intended to inform the public of the Commission's
experience with APO breaches. The Commission also intends that this
notice will educate and alert representatives of parties to Commission
proceedings as to some specific types of APO breaches encountered by
the Commission. This notice is illustrative only and does not limit the
Commission's rules or standard APO. The notice does not provide an
exclusive list of conduct that will be deemed to be a breach of the
Commission's APOs, and does not indicate how the Commission will rule
in future cases.
FOR FURTHER INFORMATION CONTACT: Paul R. Bardos, Esq., Office of the
General Counsel, U.S. International Trade Commission, telephone 202-
205-3102.
SUPPLEMENTARY INFORMATION: The discussion below illustrates 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 1993 with respect to
antidumping and countervailing duty cases. Also discussed are the
Commission's investigations completed during 1993 of possible
violations of Commission rule 207.3, commonly known as the ``one day
rule.'' Finally, in the interest of providing as much information to
practitioners as possible on APO practice, this notice also discusses
breach investigations completed during the period 1988-1993 with
respect to investigations under section 337 of the Tariff Act of 1930.
The Commission will report a summary of its actions in response to
violations of Commission APOs periodically in an effort to educate
those obtaining access under an APO of the common problems encountered
in handling business proprietary information (BPI) and confidential
business information (CBI). This is the fourth notice of its kind, the
previous ones having been published at 56 FR 4846-4850 (Feb. 6, 1991);
57 FR 12335 (Apr. 9, 1992); and 58 FR 21991 (Apr. 26, 1993). The
Commission intends to publish summaries at least annually, and more
frequently as appropriate.
As part of the effort to educate practitioners about APO practice,
the Commission's Secretary issued in September 1991 An Introduction to
Administrative Protective Order Practice in Antidumping and
Countervailing Duty Investigations. This document is available upon
request from the Office of the Secretary, U.S. International Trade
Commission, 500 E Street, SW., Washington, DC 20436, telephone 202-205-
2000.
I. Title VII Administrative Protective Orders
A. In General
APOs are issued in Commission investigations under Title VII of the
Tariff Act of 1930 to provide access to BPI to certain party
representatives under conditions designed to protect the
confidentiality of such information. The Commission is required to
disclose under APO to the authorized representatives of interested
parties who are parties to an investigation BPI collected by the
Commission in the course of such investigations. 19 U.S.C. 1677f. The
Commission has implemented procedures governing this disclosure, which
is accomplished under an APO issued by the Secretary to the Commission.
19 CFR 207.7. An important provision of the Commission's rules relating
to APOs is the ``one day rule'' that provides parties with an extra day
in which to file the public version of certain submissions containing
BPI. 19 CFR 207.3. The one day rule, which also permits correction of
the bracketing of BPI during that extra day, 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.
The Secretary to the Commission provides BPI only to ``authorized
applicants'' who agree to be bound by the terms and conditions of an
APO. The standard APO form for antidumping and countervailing duty
investigations issued by the Commission 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 the
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 an 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 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 the APO without first having received
the written consent of the Secretary and the party or the attorney 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 the 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 the 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 the APO and Sec. 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 as the Commission deems
appropriate, including the administrative sanctions set out in the APO.
Breach of the 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; and
(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, the offender or the party represented by the offender, and denial
of further access to business proprietary information in the current or
any future investigations before the Commission.
Commission employees are not signatories to the Commission's APOs
and do not obtain access to BPI through the APO procedure.
Consequently, they are not subject to the APOs' requirements with
respect to the handling of BPI. However, Commission employees are
subject to strict statutory and regulatory constraints concerning BPI,
and face 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 personnel actions against agency
employees, this should not lead the public to conclude that no such
actions have been taken.
B. Investigations of Alleged APO Breaches
In an antidumping or countervailing duty investigation, the
investigation of an alleged APO breach generally proceeds as follows.
The Secretary, acting under delegated authority, issues to the alleged
breacher a letter of inquiry to ascertain the alleged breacher's views
on whether a breach has occurred. If, based on the response made to
such a letter of inquiry, the Commission determines that a breach has
occurred, the Commission 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. However, 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. The
Commission retains sole authority to make final determinations
regarding the existence of a breach and the appropriate action to be
taken if a breach has occurred.
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, 19
U.S.C. 1677f(g).
The breach most frequently investigated by the Commission involves
the APO's prohibition of 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 of transmission of proprietary versions of documents to unauthorized
recipients. Other breaches have involved: 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 in certain circumstances.
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
whether the breach was unintentional, lack of prior breaches committed
by the breaching party, the corrective measures taken by the breaching
party, the promptness with which the breaching party reported the
violation to the Commission, and any relevant circumstances peculiar to
the situation.
C. Specific Investigations in Which Breaches Were Found
The following case studies are presented to illustrate the various
types of APO breaches found by the Commission and the actions taken by
the Commission. In addition, the case studies discuss the factors
considered by the Commission as mitigating the offense in particular
instances. The Commission has not included some of the specific facts
in the descriptions of investigations where such disclosure 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.
The following discussion covers the 9 instances in which breaches
of APOs and/or violations of the one day rule in antidumping and
countervailing duty investigations were found in 1993:
Case 1: Two attorneys failed to bracket BPI in the confidential
version of a submission, and three other attorneys acted in a similar
fashion with respect to another submission. The Commission found that
breaches had occurred, but found that they were mitigated by the facts
that (1) the breaches were inadvertent, (2) expeditious action was
taken to correct the errors, (3) only persons under the APO and the
Commission received the confidential submissions, and (4) there was no
public disclosure of BPI. The attorneys were issued warning letters.
Case 2: Two attorneys and their secretary breached an APO by
serving a copy of the BPI version of a prehearing brief on a law firm
which was on the public service list but not on the APO list. The
secretary apparently confused the two lists. One of the attorneys whose
firm was responsible for sending the brief had signed the protective
order acknowledgement for clerical personnel, agreeing to exercise
direction and control over personnel handling BPI. The error was
discovered by the attorney who received it. The Commission issued
private letters of reprimand to both attorneys and the secretary.
Case 3: An attorney disclosed BPI at a public Commission hearing.
While finding a breach of the APO, the Commission considered as
mitigating the inadvertence of the breach and the lack of prior
breaches by the attorney. The Commission issued a warning letter to the
attorney.
Case 4: One attorney telefaxed BPI to his clients' marketing
officials who were not covered by the APO. The Commission found that
this breach was mitigated by the unintentional nature of the breach,
and the attorney's prompt recovery of the data in question. The
Commission issued a private letter of reprimand to the attorney, and in
addition required that in his next appearance before the Commission,
the attorney must work under the supervision of a more senior attorney
who would also be responsible for overseeing the attorney's handling of
BPI documents.
Case 5: Two attorneys were involved in the unauthorized release of
BPI. A paralegal under their supervision picked up documents from
opposing counsel that, unbeknownst to her, included BPI. Although
opposing counsel warned the first attorney that the material contained
BPI, that attorney failed to inform the paralegal and the second
attorney of the inclusion of BPI. Unaware of the existence of the BPI,
the second attorney directed the paralegal to distribute copies of the
material to the attorneys' clients and to hearing witnesses. In
addition to the paralegal's disclosure, the first attorney himself
distributed copies of the material to his clients without checking for
BPI.
The Commission determined that the two attorneys had breached the
APO by improperly disclosing BPI. The first attorney, who knew of the
presence of BPI, was held responsible both for the unauthorized
disclosure of BPI and for the failure to properly supervise the
paralegal, in particular the failure to alert her to the existence of
the BPI. The Commission found these mitigating factors: (1) The breach
was inadvertent, (2) the attorney had not breached an APO previously,
and (3) the attorney took expeditious action to retrieve the data and
to notify the Commission. The Commission issued a public letter of
reprimand to the first attorney. The Commission found similar factors
mitigated the second attorney's breach, and that in addition she had no
reason to anticipate the existence of the BPI, which was not
prominently marked as such on its cover sheet by opposing counsel. The
Commission issued a warning letter to the second attorney.
Case 6: Three attorneys failed to delete fully all BPI from the
public version of their prehearing brief. The Commission found a
breach, but determined it was mitigated because: (1) The attorneys took
immediate steps to notify the Commission and retrieve the pages with
BPI and to provide the Commission with the corrected pages, (2) the BPI
was not disclosed, and (3) this was the attorneys' first breach of APO.
The Commission issued warning letters to the attorneys.
Case 7: One attorney and a secretary served on a law firm not
covered by the APO a copy of the BPI version of a prehearing brief. The
Commission determined that a breach had occurred, but that it was
mitigated by (1) the senders' prompt notification of the Commission and
attempts to correct the error, (2) the lack of actual disclosure of
BPI, and (3) the fact that this was the first time the individuals had
breached an APO. The Commission issued warning letters to both the
attorney and the secretary.
Case 8: Two attorneys violated Commission rules regarding
timeliness of changes to submitted documents. The first attorney
violated the one day rule by making changes in a post-conference brief
beyond the bracketing changes allowed by the rule, and failed to
request an extension of time to file additions to the brief. The
Commission issued a warning letter to the first attorney. The second
attorney filed exhibits four days after the filing of the original
brief without requesting an extension of time. Because the submission
was made four days after the original filing, this was not technically
a violation of the one day rule, but according to the rules the filing
should have been accompanied by a request for an extension of time.
While finding a violation of the rules, the Commission found as a
mitigating circumstance the fact that the late filing was not
surreptitious, but the attorney explained in a cover letter that the
information submitted was not previously available. The Commission
issued a warning letter to the second attorney.
Case 9: Two attorneys were found to have violated an APO and the
one day rule by failing to bracket BPI contained in confidential
submissions. They also failed to include in the confidential version of
a brief a warning that bracketing was not final for one business day.
The Commission found as mitigating circumstances that this was the
attorneys' first violation and that no disclosure of BPI occurred.
Warning letters were issued to both attorneys.
D. Investigations in Which No Breach Was Found
During 1993, the Commission completed 14 investigations relating to
antidumping and countervailing duty cases in which no breach was found.
The reasons for a finding of no breach included:
(1) The information allegedly mishandled by the alleged breacher
consisted entirely of information pertaining to the alleged breacher's
own client;
(2) The information in question was not BPI; and
(3) The information in question was available to the alleged
breacher from sources other than disclosure under the APO.
II. Section 337 Administrative Protective Orders
APOs are issued in section 337 investigations pursuant to statute
and the Commission's rules. 19 U.S.C. 1337(n); 19 CFR 210.37. APO
practice in section 337 investigations differs in important respects
from APO practice in title VII investigations. Notably, in the section
337 context, it is the presiding Administrative Law Judge rather than
the Secretary who issues the APO. The terms of the APO may differ from
case to case. Further, the one day rule does not apply.
In a section 337 investigation that is no longer before the
administrative law judge but is before the Commission, the
investigation of an alleged APO breach generally proceeds in the
following manner. The Secretary issues a letter of inquiry to ascertain
the alleged breacher's views on whether a breach has occurred. If,
based on the response made to such a letter of inquiry, the Commission
determines that a breach has occurred, the Commission 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. The
Commission retains sole authority to make final determinations
regarding the existence of a breach and the appropriate action to be
taken if a breach has occurred.
In section 337 investigations that are before the presiding
Administrative Law Judge, it is the judge who presides over the inquiry
into any alleged APO breaches.
Breaches have involved the unauthorized dissemination of CBI; the
use of CBI for purposes other than the investigation; and the failure
to return or destroy CBI in a timely manner. The following are the two
instances (of the 8 alleged breaches investigated) in which breaches of
APOs in section 337 investigations were found during the period 1988-
1993:
Case 10: Eleven attorneys, representing several parties to an
investigation, committed a variety of APO breaches. All eleven failed
to return or destroy confidential business information after the end of
the investigation. The Commission issued private letters of reprimand
to the nine attorneys who committed only that breach.
In addition to improperly retaining the confidential business
information, two attorneys committed additional violations. The first
of the two also used the information in preparing a brief for use in a
court action, thus violating the APO's requirement that the information
was to be used solely for the purposes of the Commission investigation
and any appeals therefrom. The Commission, finding that the first
attorney had exhibited a deliberate disregard of his obligations under
the APO, issued to the first attorney a public letter of reprimand and
barred him from access to confidential business information in any
Commission investigation for three months. The second attorney of the
two not only improperly retained the confidential business information
but also disclosed it to unauthorized persons and failed to report that
disclosure promptly to the Commission or the presiding administrative
law judge. The Commission found as a mitigating circumstance a terminal
illness in his family during the proceedings. The second attorney
received a public letter of reprimand.
Case 11: During oral argument before a court, an attorney disclosed
confidential business information. The Commission found a breach of
APO, although it was mitigated by its inadvertence, the attorney's
subsequent cooperation with the Commission to rectify the error, and
the fact that this was his first breach of an APO. The Commission
issued a private letter of reprimand. The Commission notes that this
breach occurred before the Commission had adopted its policy of issuing
warning letters where appropriate mitigating circumstances are present.
By order of the Commission.
Issued: April 4, 1994.
Donna R. Koehnke,
Secretary.
[FR Doc. 94-8472 Filed 4-7-94; 8:45 am]
BILLING CODE 7020-02-P
