Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-05944/USCOURTS-cand-3_07-cv-05944-240/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 15:1 Antitrust Litigation

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

IN RE: CATHODE RAY TUBE (CRT)

ANTITRUST LITIGATION

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Case No. C 07-5944 SC

MDL No. 1917

ORDER DENYING MOTION TO COMPEL

I. INTRODUCTION

Now before the Court is the Direct Action Plaintiffs' ("DAPs") 

motion to compel production of a document from Defendants Chunghwa 

Picture Tubes, Ltd., LG Electronics, Philips, Samsung SDI, Toshiba 

Corp., Panasonic, and MTPD (collectively "Defendants"). The 

parties briefed this motion before the case's Special Master, who 

referred the matter to the Court. ECF No. 2432. The motion is 

fully briefed, ECF Nos. 2446 ("Mot."), 2449 ("Opp'n"), and 

appropriate for resolution without oral argument, Civ. L.R. 7-1(b). 

The motion is DENIED, as explained below.

II. BACKGROUND

The parties are familiar with this case's factual background. 

The facts germane to this motion are as follows. The DAPs seek 

production of a confidential European Commission ("EC") decision

Case 3:07-cv-05944-JST Document 2463 Filed 03/26/14 Page 1 of 8
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United States District Court

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(the "Decision"), issued on December 5, 2012, which relates to EC

investigations regarding the Defendants' participation in an 

alleged price-fixing conspiracy regarding color display tubes 

("CDTs") and color picture tubes ("CPTs"), two different types of 

cathode ray tubes ("CRTs"). The EC has not yet published a public 

or redacted version of the Decision, but a summary of the Decision 

confirms that these Defendants, plus Technicolor, were found to 

have participated in price-fixing cartels for CDTs and CPTs, and 

were collectively fined more than € 1.47 billion. Mot. Ex. 2 

("Summary") ¶¶ 1, 11-12. Public statements regarding the Decision 

state that the two cartels were highly organized, aware of the 

illegality of their activity, and ultimately successful in imposing 

harmful price increases on consumers. Id. Ex. 3 ("EC Press 

Release"). When the EC issued the Decision, it said that it and 

the companies involved were trying to establish a public, redacted 

version "with a view to a quick publication," though as of this 

Order's signature date, no such public version has been made 

available. Id. Ex. 4. 

In 2010, the Direct Purchaser Plaintiffs ("DPPs") served 

Defendants with a discovery request related to the EC's 

investigation (since, at that time, the Decision had not yet 

issued), but Defendants continually refused based on their belief 

that European Union ("EU") law and EC policy prohibited the 

disclosure of those documents. Now the DAPs seek production of the 

Decision, but Defendants still refuse. See Opp'n at 1-6.

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United States District Court

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III. DISCUSSION

The Federal Rules of Civil Procedure authorize party-initiated 

discovery of any evidence that is relevant to any party's claims or 

defenses. Fed. R. Civ. P. 26(b)(1). However, Rule 26 grants the 

court discretion to limit discovery on several grounds, including 

international comity. See Societe Nationale Industrielle 

Aerospatiale v. U.S. Dist. Court for the S. Dist. of Iowa, 482 U.S. 

522, 544 (1987). American courts, in supervising pretrial 

proceedings, should exercise special vigilance to demonstrate due 

respect for any sovereign interest expressed by a foreign state.

Id. at 546.

"Comity, in the legal sense, is neither a matter of absolute 

obligation, on the one hand, nor of mere courtesy and good will, 

upon the other." Id. at 544 (citing Hilton v. Guyot, 159 U.S. 113, 

163-64 (1895)). It is the recognition that one nation allows 

within its territory to the legislative, executive, or judicial 

acts of another nation, having due regard both to international 

duty and convenience, and to the rights of its own citizens or of 

other persons who are under the protection of its laws. Id.; In re 

Rubber Chems. Antitrust Litig., 486 F. Supp. 2d 1078, 1081 (N.D. 

Cal. 2007).

The Supreme Court and the Ninth Circuit agree that comity and 

foreign law alone will not be dispositive when a discovery dispute 

arises regarding a foreign law's protection of documents sought in 

a United States court. See id. at 544 & n.29; Societe 

Internationale Pour Participations Industrielles et Commerciales v. 

Rogers, 357 U.S. 197, 208 (1958); Richmark Corp. v. Timber Falling 

Consultants, 959 F.2d 1468, 1474-75 (9th Cir. 1992). The Court 

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United States District Court

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must consider the following factors in determining whether or not 

foreign law excuses noncompliance with a United States court's 

discovery orders:

(1) the importance to the . . . litigation of the 

documents or other information requested; (2) the degree 

of specificity of the request; (3) whether the 

information originated in the United States; (4) the 

availability of alternative means of securing the 

information; and (5) the extent to which noncompliance 

with the request would undermine important interests of 

the United States, or compliance with the request would 

undermine important interests of the state where the 

information is located.

Aerospatiale, 482 U.S. at 544 n.28. This list is not exhaustive. 

The Ninth Circuit has also considered other factors, including "the 

extent and the nature of the hardship that inconsistent enforcement 

would impose upon the person, . . . [and] the extent to which 

enforcement by action of either state can reasonably be expected to 

achieve compliance with the rule prescribed by that state." United 

States v. Vetco, Inc., 691 F.2d 1281, 1287 (9th Cir. 1981); 

Richmark, 959 F.2d at 1475. Defendants do not dispute the 

request's specificity, but they contend that no other factor 

counsels granting the DAPs' motion. Id. 

First, courts are less inclined to ignore a foreign state's 

concerns if the outcome of litigation "does not stand or fall on 

the present discovery order," or if the evidence sought is 

cumulative. Richmark, 959 F.2d at 1475; In re Rubber Chems., 486 

F. Supp. 2d at 1082. The DAPs argue that the Decision is important 

because it concerns the formation and duration of the conspiracy, 

the conspiracy's geographic reach, the price-fixing activities at 

the conspiracy's center, and the conspirators' attempts to conceal 

the conspiracy's existence. Mot. at 4. Defendants contend that 

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United States District Court

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the Decision is irrelevant, because it concerns the European CDT 

and CPT market and applies EU, not US, law. Opp'n at 2-3. 

The Court finds the Decision is relevant, because the DAPs' 

and other plaintiffs' allegations in this case have always 

concerned the international character of the alleged CRT 

conspiracy. Applicable law would clearly be different in a foreign 

jurisdiction, but the Decision could include relevant facts

regardless of any foreign legal analysis. This weighs for 

production.

Second, the DAPs do not dispute the fact that the Decision 

originated from the EU, not the US. This weighs against production 

due to the EU's sovereign interest in governmental information 

produced within its borders. See In re Rubber Chems., 486 F. Supp. 

2d at 1083; see also In re Air Cargo Shipping Svcs. Antitrust 

Litig., 278 F.R.D. 51, 52-53 (E.D.N.Y. 2010). Further, Defendants 

do not appear to have released the Decision in other litigation, 

and they have continually relied on the application of EU 

confidentiality law in the present dispute. This also weighs 

against production.

Third, the parties dispute the availability of the Decision 

outside this demand for production. Defendants contend that the 

Decision will be available as soon as the EC completes its 

preparation of a public version. Opp'n at 4. They also note that 

fact discovery does not close for six months, during which time 

publication of the Decision is likely. Id. at 4-5. The DAPs argue 

that no alternative means of learning the Decision's detailed 

findings are available, and that since Defendants' cooperation is 

necessary for production of a public version of the Decision, 

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United States District Court

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Defendants have an incentive to proceed very slowly in order to 

avoid producing the Decision in this litigation. Mot. at 4, 7. 

The Court finds that this factor weighs in favor of production, 

because there does not appear to be an alternative means of 

accessing the Decision without contravening EU law and policy.

However, since the Court explains below that the EU's 

interests override the need for production in this case, the Court 

notes here that the speedy development of a public version of the 

Decision is highly important. Defendants state that publication of 

a non-confidential version of the Decision within six months is 

"likely." Opp'n at 4. Because they already appear to be on notice 

of the importance of that publication, Defendants are encouraged to

proceed apace with their collaboration in the EC's public version 

of the Decision.

Finally, the Court must balance international comity with the 

policies of the Federal Rules of Civil Procedure in order to 

determine the extent to which noncompliance with the discovery 

request would undermine important United States interests, compared 

to how compliance could undermine important interests of the state 

where the information is located. Aerospatiale, 482 U.S. at 544. 

In evaluating the interests on both sides, the Court considers both 

"expressions of interest by the foreign state" and "indications of 

the foreign state's concern for confidentiality prior to the 

controversy," as well as the United States' interest in vindicating 

American plaintiffs' rights. Richmark, 959 F.2d at 1477.

The DAPs contend that the investigation behind the Decision is 

over, that they do not seek the underlying investigative materials 

(only the Decision itself), and that the EC's delay in issuing a 

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public version of the Decision are all factors favoring production. 

Mot. at 4. The DAPs also argue that any confidentiality concerns 

are lessened where few Defendants remain in the CRT business and a 

protective order on the case shields any designated information 

from the public. Id. 

Defendants argue that EU law and EC policy are very clear 

here: disclosure of the Decision would violate foreign law, 

frustrate the EC's investigations of antitrust cases, and subject 

Defendants to harsh sanctions at home and abroad. In support of 

this, they supply a letter from Eric van Ginderachter, Director of 

the EC's Directorate General for Competition ("DG Competition"), 

which the Supreme Court has recognized as "the European Union's 

primary antitrust law enforcer." Intel Corp. v. Advanced Micro 

Devices, Inc., 542 U.S. 241, 250 (2004); Opp'n Ex. D ("DG 

Competition Letter"). 

The Court finds that comity outweighs discovery in this 

instance. In terms of law, Article 337 of the Treaty of the 

Functioning of the European Union and Article 28 of EC Regulation 

1/2003 require the EC to refrain from disclosing information 

acquired or exchanged pursuant to the EU's competition laws. EU 

law also potentially subjects parties who disclose such 

confidential information to official sanctions, including being 

reported to their home jurisdictions' bars. In terms of policy, 

the DG Competition Letter states that even though its investigation 

as to these Defendants is over for purposes of the Decision, it 

objects to the Decision's disclosure because its leniency program 

"is a cornerstone of its cartel detection and enforcement," whose 

"optimal functioning requires that a party that comes forward and 

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cooperates with the Commission does not find itself worse-off visà-vis the non-cooperating cartel members as a result of doing so." 

DG Competition Letter at 3. The EC also relies on cooperation from 

United States law enforcement agencies, including the Department of 

Justice, and while the Letter does not say as much, the cooperation 

of United States and EU agencies is an aspect of comity. See In re 

Rubber Chems., 486 F. Supp. 2d at 1084 (noting that a similar 

letter from the DG Competition objecting to disclosure of a similar 

decision could impact US-EU cooperation in international antitrust 

enforcement).

The Court therefore finds that the final factor weighs against 

disclosure, and that it also outweighs the benefit the DAPs might 

receive in obtaining the Decision. However, as noted above, 

Defendants seem optimistic about the EC's publication of a public 

version of the Decision before the close of discovery in this case. 

They are advised to assist in that task.

IV. CONCLUSION

For the reasons explained above, the Direct Action Plaintiffs' 

motion to compel is DENIED without prejudice.

IT IS SO ORDERED.

Dated: March 26, 2014

UNITED STATES DISTRICT JUDGE

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