[Federal Register Volume 77, Number 194 (Friday, October 5, 2012)]
[Proposed Rules]
[Pages 60952-60956]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-24633]


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INTERNATIONAL TRADE COMMISSION

19 CFR Part 210


Rules of General Application, Adjudication, and Enforcement

AGENCY: International Trade Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The United States International Trade Commission 
(``Commission'') proposes to amend its Rules of Practice and Procedure 
concerning adjudication and enforcement. The amendments are necessary 
to address concerns that have arisen about the scope of discovery in 
Commission proceedings under section 337 of the Tariff Act of 1930 (19 
U.S.C. 1337) (``section 337''). The intended effect of the proposed 
amendments is to reduce expensive, inefficient, unjustified, or 
unnecessary discovery practices in agency proceedings while preserving 
the opportunity for fair and efficient discovery for all parties.

DATES: To be assured of consideration, written comments must be 
received by 5:15 p.m. on December 4, 2012.

ADDRESSES: You may submit comments, identified by docket number MISC-
041, by any of the following methods:

--Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
--Agency Web Site: http://www.usitc.gov. Follow the instructions for 
submitting comments on the Web site at http://www.usitc.gov/secretary/edis.htm.
--Mail: For paper submission. U.S. International Trade Commission, 500 
E Street SW., Room 112, Washington, DC 20436.
--Hand Delivery/Courier: U.S. International Trade Commission, 500 E 
Street SW., Room 112, Washington, DC 20436, from the hours of 8:45 a.m. 
to 5:15 p.m.

    Instructions: All submissions received must include the agency name 
and docket number (MISC-041), along with a cover letter stating the 
nature of the commenter's interest in the proposed rulemaking. All 
comments received will be posted without change to http://www.usitc.gov, including any personal information provided. For paper 
copies, a signed original and 8 copies of each set of comments should 
be submitted to Lisa R. Barton, Acting Secretary, U.S. International 
Trade Commission, 500 E Street SW., Room 112, Washington, DC 20436.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.usitc.gov and/or the U.S. 
International Trade Commission, 500 E Street SW., Room 112, Washington, 
DC 20436.

FOR FURTHER INFORMATION CONTACT: Clark S. Cheney, telephone 202-205-
2661, Office of the General Counsel, United States International Trade 
Commission. 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 
may also be obtained by accessing its Internet server at http://www.usitc.gov.

SUPPLEMENTARY INFORMATION: The preamble below is designed to assist 
readers in understanding these proposed amendments to the Commission 
Rules. This preamble provides background information, a regulatory 
analysis of the proposed amendments, an explanation of the proposed 
amendments to Part 210, and a description of the proposed amendments to 
the rules. The Commission encourages members of the public to comment 
on whether the language of the proposed amendments is sufficiently 
clear for users to understand, in addition to any other comments they 
wish to make on the proposed amendments.
    If the Commission decides to proceed with this rulemaking after 
reviewing the comments filed in response to this notice, the proposed 
rule revisions will be promulgated in accordance with

[[Page 60953]]

provisions found in section 553 of the Administrative Procedure Act 
(``APA'') (5 U.S.C. 553), although not all provisions of section 553 
apply to this rulemaking. The revisions will be codified in 19 CFR Part 
210.

Background

    Section 335 of the Tariff Act of 1930 (19 U.S.C. 1335) authorizes 
the Commission to adopt such reasonable procedures, rules, and 
regulations as it deems necessary to carry out its functions and 
duties. This rulemaking seeks to improve provisions of the Commission's 
existing Rules of Practice and Procedure.
    This rulemaking was undertaken to address concerns that have arisen 
about the scope of discovery in Commission proceedings under section 
337 of the Tariff Act of 1930 (19 U.S.C. 1337) (``section 337''). The 
Commission proposes amendments to its rules governing investigations 
under section 337 in order to increase the efficiency of its section 
337 investigations.
    Over the past year, the Commission has been considering proposals 
to improve procedures relating to discovery in Commission proceedings 
under section 337 generally and to improve procedures relating to the 
discovery of electronically stored information (``e-discovery'') 
specifically. On July 19, 2011, The George Washington University Law 
School hosted a forum on the discovery of electronically stored 
information in section 337 investigations. Presenters at the forum 
stated that parties to section 337 investigations often search and 
produce large volumes of information stored in electronic format to 
satisfy discovery obligations in section 337 proceedings but that only 
a small fraction of that information is admitted into the investigation 
record. Presenters questioned whether the potential benefit of 
discovered materials outweighs the costs associated with current 
discovery obligations. Presenters also compared e-discovery procedures 
in various district courts with discovery procedures at the Commission 
and made various proposals for improving the Commission's procedures.
    The Commission has considered, inter alia, e-discovery proposals 
from the International Trade Commission Trial Lawyers Association; a 
draft proposal on e-discovery from the International Trade Commission 
Committee of the American Bar Association Intellectual Property 
section; a model e-discovery order prepared by the Federal Circuit 
Advisory Council; e-discovery provisions in a pilot program underway in 
the U.S. District Court for the Southern District of New York; e-
discovery standards promulgated by the U.S. District Court for the 
District of Delaware; a model order regarding e-discovery in patent 
cases issued by the U.S. District Court for the Eastern District of 
Texas; ground rules promulgated by administrative law judges at the 
Commission; and analogous portions of the Federal Rules of Civil 
Procedure that concern limitations on discovery and that concern the 
discovery of electronically stored information.
    Some of the materials considered by the Commission describe a risk 
of inadvertent disclosure of privileged information or attorney work 
product during the production of electronically stored information. 
Accordingly, the Commission has also considered provisions in the 
Federal Rules of Civil Procedure and the Federal Rules of Evidence 
concerning the discovery of privileged or protected information.
    After reviewing the foregoing materials and other information, the 
Commission is considering adopting certain rules relating to discovery 
generally, to e-discovery specifically, and to the discovery of 
privileged information and attorney work product. Some of the 
provisions under consideration could result in limitations on discovery 
in section 337 investigations. Other provisions would implement, in 
section 337 investigations, some of the standards provided in the 
Federal Rules of Civil Procedure and the Federal Rules of Evidence 
concerning the discovery of electronically stored information and 
concerning the discovery of privileged or protected information.
    The current notice of proposed rulemaking is consistent with the 
Commission's plan to ensure that the Commission's rules are effective, 
as detailed in the Commission's Plan for Retrospective Analysis of 
Existing Rules, published February 14, 2012, and found at 77 FR 8114. 
This plan was issued in response to Executive Order 13579 of July 11, 
2011, and established a process under which the Commission will 
periodically review its significant regulations to determine whether 
any such regulations should be modified, streamlined, expanded, or 
repealed so as to make the agency's regulatory program more effective 
or less burdensome in achieving regulatory objectives. During the two 
years following the publication of the plan, the Commission expects to 
review a number of aspects of its rules. This includes a general review 
of existing regulations in 19 CFR Parts 201, 207, and 210. It should be 
noted that some of the amendments proposed in this notice have been 
under consideration since before the plan was established.
    The Commission invites the public to comment on all of these 
proposed rules amendments. In any comments, please consider addressing 
whether the language of the proposed amendments is sufficiently clear 
for users to understand. Please also consider addressing how the 
proposed rules amendments could be improved and offering specific 
constructive alternatives where appropriate. Because some of the 
provisions in the proposed amendments are similar to certain provisions 
in the Federal Rules of Civil Procedure, the Commission is interested 
in comments concerning the relevance of any variances between the 
proposals and similar provisions in the Federal Rules of Civil 
Procedure.
    Consistent with its ordinary practice, the Commission is issuing 
these proposed amendments in accordance with certain requirements found 
in section 553 of the APA, although not all provisions of section 553 
apply to this rulemaking. This procedure entails the following steps: 
(1) Publication of a notice of proposed rulemaking; (2) solicitation of 
public comments on the proposed amendments; (3) Commission review of 
public comments on the proposed amendments; and (4) publication of 
final amendments at least thirty days prior to their effective date.

Regulatory Analysis of Proposed Amendments to the Commission's Rules

    The Commission has determined that the proposed rules do not meet 
the criteria described in section 3(f) of Executive Order 12866 (58 FR 
51735, Oct. 4, 1993) and thus do not constitute a significant 
regulatory action for purposes of the Executive Order.
    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) is 
inapplicable to this rulemaking because it is not one for which a 
notice of final rulemaking is required under 5 U.S.C. 553(b) or any 
other statute. Although the Commission has chosen to publish a notice 
of proposed rulemaking, these proposed regulations are ``agency rules 
of procedure and practice,'' and thus are exempt from the notice 
requirement imposed by 5 U.S.C. 553(b).
    These proposed rules do not contain federalism implications 
warranting the preparation of a federalism summary impact statement 
pursuant to Executive Order 13132 (64 FR 43255, Aug. 4, 1999).
    No actions are necessary under the Unfunded Mandates Reform Act of 
1995 (2 U.S.C. 1501 et seq.) because the proposed rules will not result 
in

[[Page 60954]]

expenditure in the aggregate by State, local, and tribal governments, 
or by the private sector, of $100,000,000 or more in any one year, and 
will not significantly or uniquely affect small governments, as defined 
in 5 U.S.C. 601(5).
    The proposed rules are not major rules as defined by section 804 of 
the Small Business Regulatory Enforcement Fairness Act of 1996 (5 
U.S.C. 801 et seq.). Moreover, they are exempt from the reporting 
requirements of the Contract With America Advancement Act of 1996 (Pub. 
L. 104-121) because they concern rules of agency organization, 
procedure, or practice that do not substantially affect the rights or 
obligations of non-agency parties.
    The amendments are not subject to section 3504(h) of the Paperwork 
Reduction Act (44 U.S.C. 3504(h)).

Part 210

Subpart E--Discovery and Compulsory Process

Section 210.27
    Section 210.27(b) is similar to Federal Rule of Civil Procedure 
26(b)(1) and provides that the scope of discovery in section 337 
investigations includes any matter, not privileged, that is relevant to 
a claim or defense of any party. The rule also currently provides that 
a person may not object to a discovery request as seeking inadmissible 
evidence if the request appears reasonably calculated to lead to the 
discovery of admissible evidence. Unlike Federal Rule of Civil 
Procedure 26(b), however, Sec.  210.27(b) contains no limitations on 
the discovery of electronically stored information and provides little 
guidance on when it would be appropriate for an administrative law 
judge to limit discovery generally. The Commission proposes to amend 
Sec.  210.27(b) to state that the scope of discovery in a Commission 
investigation may be limited in certain ways, as discussed further in 
the proposed amendments.
    The Commission proposes to add to Sec.  210.27 new subsections (c), 
(d), and (e), which address certain concerns associated with discovery 
generally, electronically stored information, privileged 
communications, or attorney work product. The Commission proposes to 
renumber current subsections (c) and (d) as subsections (f) and (g). 
Some of the proposed amendments use the word ``person.'' The Commission 
intends the word ``person'' to be construed in accordance with the 
definition found in section 201.2(j) of the Commission's Rules of 
General Application, 19 CFR Sec.  201.2(j).
    Proposed subsection (c) would provide specific limitations on 
electronically stored information. As discussed in the Committee Notes 
on the 2006 Amendments to Federal Rule of Civil Procedure 26(b)(2), 
electronic storage systems often make it easier to locate and retrieve 
information. These advantages are properly taken into account in 
determining the reasonable scope of discovery in a particular case. But 
some sources of electronically stored information can be accessed only 
with substantial burden and cost. In a particular case, these burdens 
and costs may make the information on such sources not reasonably 
accessible. It is not possible to define in a rule the different types 
of technological features that may affect the burdens and costs of 
accessing electronically stored information. The Commission therefore 
proposes to add certain discovery provisions to Part 210 that may be 
utilized by parties and administrative law judges in a variety of 
circumstances.
    Similar to Federal Rule of Civil Procedure 26(b)(2)(B), proposed 
subsection (c) would state that a person need not provide discovery of 
electronically stored information from sources that the person 
identifies as not reasonably accessible because of undue burden or 
cost. Nevertheless, if electronically stored information is withheld 
from discovery because it is not reasonably accessible, the party 
seeking the information may file a motion to compel discovery of the 
electronically stored information. Proposed subsection (c) would 
provide that a person from whom discovery is sought must show, in 
response to a motion to compel discovery or in response to a motion for 
a protective order, that the information is not reasonably accessible 
because of undue burden or cost. If that showing is made, the proposal 
would allow the administrative law judge to order discovery from such 
sources if the requesting party shows good cause, considering certain 
limitations found in proposed subsection (d). Proposed subsection (c) 
would also allow the administrative law judge to specify conditions for 
discovery of electronically stored information.
    The Commission contemplates that under this paragraph the 
administrative law judge may, by order, impose conditions for discovery 
required by the specific circumstances of a given investigation. For 
example, as stated the Committee Notes on the 2006 Amendments to 
Federal Rule of Civil Procedure 26(b)(2), the administrative law judge 
may, in appropriate circumstances, condition discovery upon payment by 
the requesting party of part or all of the reasonable costs of 
obtaining information from sources that are not reasonably accessible. 
The Commission contemplates that the case law developed under Federal 
Rule of Civil Procedure 26(b)(2)(B) would provide guidance for 
application of proposed subsection (c).
    Proposed subsection (d) requires the administrative law judge to 
limit discovery otherwise allowed under the Commission's rules in 
certain circumstances. Similar to Federal Rule of Civil Procedure 
26(b)(2)(C), proposed subsection (d) requires limitations on discovery 
if the administrative law judge determines that the discovery sought is 
duplicative or can be obtained from a less burdensome source; the party 
seeking discovery has had ample opportunity to obtain the information; 
or the burden of the proposed discovery outweighs its likely benefit.
    Proposed subsection (d) differs from Federal Rule of Civil 
Procedure 26(b)(2)(C) in two respects. First, proposed subsection (d) 
would require the administrative law judge to limit discovery when the 
person from whom discovery is sought has waived the legal position that 
justified the discovery or has stipulated to the facts pertaining to 
the issue to which the discovery is directed. Second, proposed 
subsection (d) does not include the language in Federal Rule of Civil 
Procedure 26(b)(2)(C) that requires analysis of the importance of the 
issues at stake in the action. Rather, the proposed subsection requires 
the administrative law judge to consider the importance of the 
discovery in resolving the issues to be decided by the Commission.
    Proposed subsection (e) would add new provisions concerning 
privileged information and attorney work product. As explained in the 
Advisory Committee Notes concerning Federal Rule of Evidence 502, 
litigation costs necessary to protect against waiver of attorney-client 
privilege or attorney work product have become prohibitive due to the 
concern that any disclosure (however innocent or minimal) will operate 
as a subject matter waiver of all protected communications or 
information. This concern is especially troubling in cases involving 
electronic discovery.
    Adding to this uncertainty, no Commission rule requires the 
production of a privilege log when a person withholds materials from 
discovery based on an assertion of privilege or work product 
protection. Privilege log provisions are currently ordered by the 
administrative law judges in their respective ground rules.

[[Page 60955]]

    Proposed subsection (e) would mitigate these concerns by providing 
uniform set of procedures under which persons can make claims of 
privilege or work product production using a privilege log. Proposed 
subsection (e) would also include a predictable procedure for 
determining the consequences of a disclosure of a communication or 
information covered by the attorney-client privilege or work-product 
protection, similar to the procedure found in Federal Rule of Civil 
Procedure 26(b)(5). Proposed subsection (e) goes beyond Federal Rule of 
Civil Procedure 26(b)(5) by providing prompt deadlines for resolving 
privilege disputes, in accordance with the expeditious nature of 
investigations under section 337.
    Proposed subsection (e) makes no attempt to alter federal or state 
law on whether a communication or information is protected under the 
attorney-client privilege or work-product immunity as an initial 
matter.
    Some proposals considered by the Commission contained a so-called 
``claw-back'' rule that would categorically preclude a finding of a 
waiver of privilege or work product protection when otherwise protected 
materials are inadvertently produced in discovery. The ``claw-back'' 
proposals considered by the Commission left some question as to 
whether, in order to avoid a finding of waiver, the holder of the 
privilege or protection must take reasonable steps to prevent 
disclosure, as is required by Federal Rule of Evidence 502.
    Proposed subsection (e) is not a categorical ``claw-back'' rule. 
Proposed subsection (e) would not supplant any applicable waiver 
doctrine. If proposed subsection (e) were adopted, the Commission would 
expect administrative law judges to apply federal and common law when 
determining the consequences of any allegedly inadvertent disclosure. 
That law would include consideration of whether the holder of the 
privilege or protection took reasonable steps to prevent disclosure of 
the information and other considerations found in Federal Rule of 
Evidence 502.

List of Subjects in 19 CFR Part 210

    Administration practice and procedure, Business and industry, 
Customs duties and inspection, Imports, Investigations.

    For the reasons stated in the preamble, the United States 
International Trade Commission proposes to amend 19 CFR part 210 as 
follows:

PART 210--ADJUDICATION AND ENFORCEMENT

    1. The authority citation for Part 210 continues to read as 
follows:

    Authority: 19 U.S.C. 1333, 1335, and 1337.

Subpart E--Discovery and Compulsory Process

    2. Amend Sec.  210.27 by:
    a. Adding one sentence at the end of paragraph (b);
    b. Renumbering paragraphs (c) and (d) to be paragraphs (f) and (g); 
and
    c. Adding new paragraphs (c), (d), and (e).
    The additions and revisions read as follows:


Sec.  210.27  General provisions governing discovery.

* * * * *
    (b) * * * All discovery is subject to the limitations of Sec.  
210.27(d).
    (c) Specific Limitations on Electronically Stored Information. A 
person need not provide discovery of electronically stored information 
from sources that the person identifies as not reasonably accessible 
because of undue burden or cost. The party seeking the discovery may 
file a motion to compel discovery pursuant to Sec.  210.33(a) of this 
subpart. In response to the motion to compel discovery, or in a motion 
for a protective order filed pursuant to Sec.  210.34 of this subpart, 
the person from whom discovery is sought must show that the information 
is not reasonably accessible because of undue burden or cost. If that 
showing is made, the administrative law judge may order discovery from 
such sources if the requesting party shows good cause, considering the 
limitations found in section (d) of this paragraph. The administrative 
law judge may specify conditions for the discovery.
    (d) General Limitations on Discovery. In response to a motion made 
under this paragraph or sua sponte, the administrative law judge must 
limit by order the frequency or extent of discovery otherwise allowed 
in this subpart if the administrative law judge determines that:
    (1) the discovery sought is unreasonably cumulative or duplicative, 
or can be obtained from some other source that is more convenient, less 
burdensome, or less expensive;
    (2) the party seeking discovery has had ample opportunity to obtain 
the information by discovery in the investigation;
    (3) the responding person has waived the legal position that 
justified the discovery or has stipulated to the facts pertaining to 
the issue to which the discovery is directed; or
    (4) the burden or expense of the proposed discovery outweighs its 
likely benefit, considering the needs of the investigation, the 
importance of the discovery in resolving the issues to be decided by 
the Commission, and the public interest.
    (e) Claiming Privilege or Work Product Protection. (1) When, in 
response to a discovery request made under this subsection, a person 
withholds information otherwise discoverable by claiming that the 
information is privileged or subject to protection as attorney work 
product, the person must:
    (i) expressly make the claim when responding to a relevant question 
or request; and
    (ii) within 10 days of making the claim produce to the requester a 
privilege log that describes the nature of the information not produced 
or disclosed, in a manner that will enable the requester to assess the 
claim without revealing the information at issue. The privilege log 
must separately identify each withheld document, communication, or 
thing, and to the extent possible must specify the following for each 
entry: (A) The date the information was created or communicated; (B) 
the author(s) or speaker(s); (C) all recipients; (D) the employer and 
position for each author, speaker, or recipient, including whether that 
person is an attorney or patent agent; (E) the general subject matter 
of the information; and (F) the type of privilege or protection 
claimed.
    (2) If information produced in discovery is subject to a claim of 
privilege or of protection as attorney work product, the person making 
the claim may notify any person that received the information of the 
claim and the basis for it. The notice shall identify the information 
subject to the claim using a privilege log as defined under section (1) 
of this paragraph. After being notified, a person that received the 
information (i) must within 5 days return, sequester, or destroy the 
specified information and any copies it has; (ii) must not use or 
disclose the information until the claim is resolved; and (iii) must 
within five 5 days take reasonable steps to retrieve the information if 
the person disclosed it to others before being notified. Within five 5 
days after the notice, the claimant and the parties shall meet and 
confer in good faith to resolve the claim of privilege or protection. 
Within five 5 days after the conference, a party may file a motion to 
compel the production of the information and may, in the motion to 
compel, use a description of

[[Page 60956]]

the information from a privilege log produced under this paragraph. The 
person that produced the information must preserve the information 
until the claim of privilege or protection is resolved.
    (3) Parties may enter into a written agreement to waive compliance 
with section (1) of this paragraph for documents, communications, and 
things created or communicated within a time period specified in the 
agreement. The administrative law judge may deny any motion to compel 
information claimed to be subject to the agreement. If information 
claimed to be subject to the agreement is produced in discovery then 
the administrative law judge may determine that the produced 
information is not entitled to privilege or protection.
    (4) For good cause, the administrative law judge may order a 
different period of time for compliance with any requirement of this 
paragraph.
    (f) * * *
    (g) * * *

    By Order of the Commission.

     Issued: October 2, 2012.
 William R. Bishop,
Hearings and Meetings Coordinator.
[FR Doc. 2012-24633 Filed 10-4-12; 8:45 am]
BILLING CODE 7020-02-P