pRtGINAL 

UNITED STATES OF AMERICA 

FEDERAL TRADE COMMISSION 

OFFICE OF ADMINISTRATIVE LAW JUDGES 

) 

In the Matter of ) 

) Docket No. 9327 

POL YPORE INTERNATIONAL, INC., ) 

Respondent. ) 

) 

ORDER ON RESPONDENT'S MOTION FOR 

SANCTIONS REGARDING EXPERT WITNESS 

I. 

On April!7, 2009, Respondent Polypore International, Inc. ("Polypore") submitted its 

Motion for Sanctions Due to Exide Technologies' Interference with Respondent's Expert 

Witness ("Motion"). Complaint Counsel submitted its Response to Respondent's Motion for 

Sanctions ("Response") on April 22, 2009. Non-party Exide Technologies' Opposition to

Respondent's Motion for Sanctions ("Opposition") was submitted on April 
 27, 2009. 

For the reasons set forth below, Respondent's Motion for Sanctions is DENIED. 

II. 

Respondent asserts that "there is ample evidence" that non-party Exide Technologies, 

("Exide"), a customer of 
 Polyp ore, has "interfered" with Respondent's expert witness, Dr. James

Mark Stevenson ("Dr. Stevenson"), a former employee of Ex ide. Motion at 1. Respondent 

points to a letter from Exide's counsel to Dr. Stevenson on March i 9,2009 - the day before his 

expert report was due - reminding him of his contractual obligation to keep secret all 

confidential information that he had acquired during his employment with Exide, waring that 

"Exide Technologies wil take action, if necessar, to protect the confidentiality of its proprietary 

information." Ex. A, at 2, to Motion. 

Respondent states that Dr. Stevenson repeatedly sought guidance from Exide regarding 

the scope of 
 his 25-year old confidentiality agreement with that former employer, and sought 

assurances that Exide would take no legal action against him based on any alleged violation of 

this agreement through his work as an expert witness for Respondent. While there is no affidavit 

or declaration from Dr. Stevenson, Respondent alleges that it is "(0 Jut of fear of reprisal from 

Exide," Motion at 3, that Dr. Stevenson did not file his expert report on or after March 20,2009, 
and has advised Respondent that he cannot proceed as an expert witness absent assurances from 

Exide. 

Respondent, claiming interference with justice and extreme prejudice to itself, requests 

an order: (a) providing that Exide's relief is in camera treatment for any testimony by 

Dr. Stevenson, (b) ruling that Dr. Stevenson's testimony in this matter wil not breach any 

obligation of confidentiality he owes to Exide, (c) precluding Exide from testifyng, by 

deposition or otherwise, at the hearng in this matter, (d) requiring that an inquiry be conducted 

on Exide's conduct, and (e) awarding Respondent its attorneys' fees and costs for this Motion. 

Complaint Counsel states in its Response that one of the requested sanctions - the 

preclusion of testimony, to be offered by Complaint Counsel into evidence, by any Exide 

witness - would in effect sanction Complaint CounseL. According to Complaint Counsel, "the 

evidence is clear that (i) Exide has a confidentiality agreement with Dr. Stevenson; (ii) Exide has 

not disobeyed any order or rule in this proceeding; (iii) Exide is not a party in this case, and no 

rule would support a sanction against Complaint Counsel for a non-pary's conduct; and (iv) 

Complaint Counsel has acceded to every request by Respondent's counsel on this issue." 

Response at 7. 

Exide states in a sworn statement by its outside counsel that Dr. Stevenson was its Vice 

President for Manufacturing, Industrial Energy Europe, until December 31, 2006. Declaration of 

Donald Russell, appended to Opposition, ir 3. Exide supplies a copy of Dr. Stevenson's 

employment contract, which includes the referenced confidentiality agreement and which 

provides that it shall be governed by, and constred in accordance with, the law of England. 

Opposition Ex. 1, at irir 9, 19. 

Exide indicates that Dr. Stevenson expects to address two subjects: the testing and 

qualification of battery separator products, and the assertedly worldwide nature of the market for 

battery separators. These subjects raise, in Exide's view, a significant risk that Dr. Stevenson's 

opinions would be based on, and might reveal, confidential information that he had obtained 

during his employment with Exide. Declaration of 
 Mr. Russell, ir 6, 7. Exide states that its 

counsel told Dr. Stevenson that, in light of 
 Dr. Stevenson's assurances that he did not expect to 

use or reveal Exide's confidential information, Exide had no objection to his work as an expert 

witness for Polypore. !d., ir 10. Exide further states that Dr. Stevenson was repeatedly informed 

by Exide that ifhe were to ask Exide whether it considered specific information confidentialwhich, according to Exide, he did not do - he would receive a prompt response. Opposition at 9; 

see Opposition Exs. 13,15,17,19. 

III. 

Respondent's Motion for Sanctions purports to be pursuant to Federal Trade Commission 

Practice 3.38 and 3.42, 16 C.F.R. §§ 3.38,3.42. ("FTC" or "Commission") Rules of 


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A. 

Under Commission Rule 3 .38(b), "If a party or an offcer or agent of a party fails to 

comply with a subpoena or with an order" for discovery, "the Administrative Law Judge or the 

Commission, or both, for the purpose of permitting resolution of relevant issues and disposition 

of the proceeding without unnecessar delay despite such failure, may take such action in regard 

thereto as is just, including but not limited to" the range of sanctions specified in Rule 

Respondent, is not a 

party to this proceeding, and its conduct with respect to Dr. Stevenson violates no subpoena or 

discovery order. 

3.38(b)(I)-(5). 16 C.F.R. § 3.38(b) (emphasis added). Exide, a customer of 


Sanctions under Rule 3.38 are warranted only in limited circumstances, which do not 

apply in this matter. As the Commission has stated: 

(SJanctions under Rule 3.38 should be imposed only if (1) production of the 

requested material has been mandated by a subpoena or specific discovery order 

issued by an ALJ or the Commission and directed at the party (or its offcer or 

agent) from whom the material is sought; (2) the party's failure to comply is 

unjustified; and (3) the sanction imposed "is reasonable in light of the material 

withheld and the purposes of 
 Rule 3.38(b)." 

In re Intl Tel. & Tel. Corp.lITTj, 104 F.T.C. 280, 449 (1984) (emphasis added), quoting 
 In re 

Grand Union Co., 102 F.T.C. 812, 1089 (1983). 

In Grand Union, the Commission considered, and upheld the denial of, sanctions based 

on the conduct of one ofthe complaint counsel's expert witnesses. Grand Union, 102 F.T.C. at 

1087 -90. "The language of Rule 3.38 makes clear that sanctions may be imposed only upon a 

part, or an officer or agent of a pary. In most cases a witness is not an agent or officer of a
 

party." !d. at 1 089.
 

In the instant matter, the sanctions that Respondent seeks include an order precluding 

Exide from testifyng, whether by deposition or otherwise, at the hearing. This requested 

sanction is not in keeping with the purpose of 
 Commission Rule 3.38(b), which is to promote 

discovery. "(TJhe purpose of 
 Rule 3.38(b) is after all to induce paries to supply subpoenaed 

materiaL." ITT, 104 F.T.C. at 450. See also In re R. J Reynolds Tobacco Co., No. 9206, 1988 

F.T.C. LEXIS 88, at *5 (1988) (purpose of sanctions under Rule 37 ofthe Federal Rules of Civil 

Procedure "to encourage discovery and to promote the production of relevant evidence"). 

B. 

Commission Rule 3.42, 16 C.F.R. § 3.42, relates to presiding officials. It is the duty of 
 the 

Administrative Law Judge "to conduct fair and impartial hearings, to take all necessary action to 

avoid delay in the disposition of 
 proceedings, and to maintain order." 16 C.F.R. § 3.42(c). There 

is no mention at all of non-parties in Rule 3.42, and the specified powers ofthe ALJ include the 

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power "(t)o regulate the course ofthe hearings and the conduct of the parties and their counsel 

therein." 16 C.F.R. § 3.42(c)(6) (emphasis added). "Any party who refuses or fails to comply 

with a lawfully issued order or direction of an Administrative Law Judge may be considered to be 

in contempt of the Commission." 16 C.F.R. § 3.42(h) (emphasis added).

Commission Rule 3.42 that might apply in 

this instance. Commission Rule 3.42 provides no support for Respondent's requested relief. 

Respondent cites to no particular subsection of 


c. 

Respondent, which offers no affdavit or declaration in support of its Motion, fails to 

identify any conduct in this matter by Exide, with respect to Dr. Stevenson in his capacity as 

expert witness for Polypore, that would warant any sanction - let alone the requested sanctions, 

which include the preclusion of any testimony by Exide. While Exide's conduct may have had 

the effect of delaying or deterrng Dr. Stevenson's work as an expert witness for Respondent, 

there is no indication that Exide acted with this specific intent, or did anything in this regard 

beyond noting to Dr. Stevenson and to Respondent's counsel a legitimate concer with the 

protection of Ex ide's confidential information. 

Respondent's requests to extend 

discovery deadlines relating to Dr. Stevenson, and there is no indication that Complaint Counsel 

"interfered" in any way with Dr. Stevenson's work as Respondent's expert witness. 

Respondent's counsel, on the other hand, has not demonstrated that it complied with Commission 

Rule 3.22(g), 16 C.F.R. § 3.22(g). That Rule requires counsel for a party moving for sanctions 

pursuant to Commission Rule 3.38(b) to "confer() with opposing counsel in an effort in good 

faith to resolve by agreement the issues raised by the motion." According to Complaint Counsel, 

Respondent's counsel did not confer with it about the issues raised by this Motion, including in 

particular Respondent's request to preclude testimony, to be offered by Complaint Counsel into 

Complaint Counsel appears to have agreed to each of 


evidence, by any Exide witness. 

Another sanction that Respondent requests is an order "determining that Dr. Stevenson's 

testimony in this matter wil not constitute a breach of any obligation of confidentiality owed by 

Dr. Stevenson to Exide." Motion at 8. This request for an advisory opinion or declaratory 

judgment on the scope of 
 the employment agreement between Dr. Stevenson and Exide, which, 

according to its own terms, is "governed by and construed in accordance with the Law of 

England," is inappropriate. Opposition Ex. 1, at ir 19. 

Respondent relatedly requests an order "limiting Exide's rights to in camera treatment for 

any testimony offered by Dr. Stevenson in this matter, whether at deposition or at the hearing." 

Yet there is no authority for so broadly limiting in advance the right of non-party Exide to take 

its proprietary information. If 

Exide or Complaint Counsel were to submit and properly support a motion, pursuant to 

Commission Rule 3.45, for in camera treatment of any testimony or other material by 

Dr. Stevenson, that motion would be considered. 

appropriate action, if warranted, to protect the confidentiality of 


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iv.
 

Upon consideration of all of 
 the arguments raised in the Motion, Response, and 

Opposition, and for the reasons set forth above, Respondent's Motion is DENIED. 

ORDERED: 3),. ~ft,tl

D. Michael Chappell 

Administrative Law Judge 

Date: May 1, 2009 

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