Federal Register / Vol. 74, No. 83 / Friday, May 1, 2009 / Rules and Regulations 20205 

1 The final rule amendments are not subject to the 

requirements of the Regulatory Flexibility Act, 5 

U.S.C. 601(2). The rule revisions to Part 3 are also 

not subject to the requirements of the Paperwork 

Reduction Act, which contains an exemption for 

information collected during the conduct of 

administrative proceedings or investigations. 44 

U.S.C. 3518(c)(1)(B)(ii); 5 CFR 1320.4. To the extent 

that Rule 4.2 applies to filings that do not fall 

within this exception, OMB has approved the 

collection of information, along with other 

applications and notices to the Commission, and 

has assigned control number 3084–0047. The 

revisions to Rule 4.2 do not substantially or 

materially modify this collection of information. 

Rulemaking, ARM–1, 800 Independence 

Avenue SW., Washington, DC 20591, or 

by calling (202) 267–9680. Please 

identify the amendment number or 

docket number of this rulemaking. 

Anyone is able to search the 

electronic form of all comments 

received into any of our dockets by the 

name of the individual submitting or 

signing the comment (if submitted on 

behalf of an association, business, labor 

union, etc.). You may review DOT’s 

complete Privacy Act statement in the 

Federal Register published on April 11, 

2000 (Volume 65, Number 70; Pages 

19477–78) or you may visit http:// 

docketsinfo.dot.gov/. 

Small Business Regulatory Enforcement 

Fairness Act 

The Small Business Regulatory 

Enforcement Fairness Act (SBREFA) of 

1996 requires the FAA to comply with 

small entity requests for information or 

advice about compliance with statutes 

and regulations within its jurisdiction. If 

you are a small entity and you have a 

question about this document, you may 

contact your local FAA official, or the 

person listed under the FOR FURTHER

INFORMATION CONTACT heading at the 

beginning of the preamble. You can find 

out more about SBREFA on the Internet 

at http://www.faa.gov/ 

regulations_policies/rulemaking/ 

sbre_act/. 

List of Subjects 

14 CFR Part 91 

Agriculture, Air traffic control, 

Aircraft, Airmen, Airports, Aviation 

safety, Freight, Noise control, Reporting 

and recordkeeping requirements. 

14 CFR Part 135 

Air taxis, Aircraft, Airmen, Aviation 

safety, Reporting and recordkeeping 

requirements. 

The Amendment 

■ In consideration of the foregoing, the 

Federal Aviation Administration 

amends Chapter I of Title 14, Code of 

Federal Regulations as follows: 

PART 91—GENERAL OPERATING AND 

FLIGHT RULES 

■ 1. The authority citation for part 91 

continues to read as follows: 

Authority: 49 U.S.C. 106(g), 1155, 40103, 

40113, 40120, 44101, 44111, 44701, 44704, 

44709, 44711, 44712, 44715, 44716, 44717, 

44722, 46306, 46315, 46316, 46504, 46506– 

46507, 47122, 47508, 47528–47531, articles 

12 and 29 of the Convention on International 

Civil Aviation (61 Stat. 1180). 

■ 2. Revise § 91.175(f)(3) to read as 

follows: 

§ 91.175 Takeoff and landing under IFR. 

* * * * * 

(f) * * * 

(3) Except as provided in paragraph 

(f)(4) of this section, no pilot may 

takeoff under IFR from a civil airport 

having published obstacle departure 

procedures (ODPs) under part 97 of this 

chapter for the takeoff runway to be 

used, unless the pilot uses such ODPs 

or an alternative procedure or route 

assigned by air traffic control. 

* * * * * 

PART 135—OPERATING 

REQUIREMENTS: COMMUTER AND 

ON DEMAND OPERATIONS AND 

RULES GOVERNING PERSONS ON 

BOARD SUCH AIRCRAFT 

■ 3. The authority citation for part 135 

continues to read as follows: 

Authority: 49 U.S.C. 106(g), 41706, 44113, 

44701–44702, 44705, 44709, 44711–44713, 

44715–44717, 44722, 45101–41505. 

■ 4. In § 135.161, revise paragraphs 

(a)(1) and (a)(3) to read as follows: 

§ 135.161 Communication and navigation 

equipment for aircraft operations under 

VFR over routes navigated by pilotage. 

(a) * * * 

(1) Communicate with at least one 

appropriate station from any point on 

the route, except in remote locations 

and areas of mountainous terrain where 

geographical constraints make such 

communication impossible. 

* * * * * 

(3) Receive meteorological 

information from any point en route, 

except in remote locations and areas of 

mountainous terrain where geographical 

constraints make such communication 

impossible. 

* * * * * 

Issued in Washington, DC, on March 16, 

2009. 

Lynne A. Osmus, 

Acting Administrator. 

[FR Doc. E9–10089 Filed 4–30–09; 8:45 am] 

BILLING CODE 4910–13–P 

FEDERAL TRADE COMMISSION 

16 CFR Parts 3 and 4 

Rules of Practice 

AGENCY: Federal Trade Commission 

(‘‘Commission’’ or ‘‘FTC’’). 

ACTION: Final rule. 

SUMMARY: The FTC is amending Rules 

3.1, 3.25, 3.31(g), and 4.2, and 

rescinding Rule 3.11A, of its Rules of 

Practice, 16 CFR Parts 3 and 4. Other 

than these revisions, it is adopting as 

final all other amendments to the Part 

3 and Part 4 Rules that were published 

as interim final rules on January 13, 

2009. 74 Fed. Reg. 1804. 

DATES: This rule is effective on May 1, 

2009, and will govern all Commission 

adjudicatory proceedings that are 

commenced on or after that date. 

FOR FURTHER INFORMATION CONTACT: 

Michael D. Bergman, Attorney, (202) 

326–3184, or Lisa M. Harrison, Assistant 

General Counsel, (202) 326–3204, Office 

of the General Counsel, Federal Trade 

Commission, 600 Pennsylvania Avenue, 

NW, Washington DC 20580. 

SUPPLEMENTARY INFORMATION: On 

January 13, 2009, the Commission 

published comprehensive amendments 

to Part 3 and various amendments to 

Part 4 of its Rules of Practice, 16 CFR 

Parts 3 and 4, in order to further 

expedite its adjudicatory proceedings, 

improve the quality of adjudicative 

decision making, and clarify the 

respective roles of the Administrative 

Law Judge (‘‘ALJ’’) and the Commission 

in Part 3 proceedings. The Commission 

requested comments on the interim final 

rules and set a deadline of February 12, 

2009, for any such comments. The 

Commission received no comments on 

its interim rules. Other than the rule 

provisions discussed below, the 

Commission is adopting the interim 

rules as final. While no comments were 

submitted, the Commission has 

determined, upon further deliberation, 

that four rule provisions should be 

amended and that one rule be 

rescinded. These amendments are 

discussed below.1

Section 3.1: Scope of the rules in this 

part; expedition of proceedings. 

The interim rule amendments that the 

Commission is adopting today as final 

will substantially expedite Part 3 

proceedings. The expedited deadlines 

apply to all Part 3 matters and are 

accelerated further for administrative 

cases where the Commission is also 

seeking preliminary injunctive relief 

from a federal district court under 

Section 13(b) of the Federal Trade 

20206 Federal Register / Vol. 74, No. 83 / Friday, May 1, 2009 / Rules and Regulations 

2 The Commission has also amended the rule to 

enable the ALJ, in his or her discretion, to 

determine whether to supplement the 

determination that there is a reasonable possibility 

of settlement with a recommendation as to whether 

the Commission should grant the motion to 

withdraw. 

Commission Act (‘‘FTC Act’’), 15 U.S.C. 

53(b), which typically occurs (but is not 

limited to) when the Commission is 

challenging an unconsummated merger. 

The Commission is therefore further 

revising Rule 3.1 to emphasize that the 

expedited scheduling of a proceeding in 

which the Commission has sought or is 

seeking relief under Section 13(b) shall 

take priority over other proceedings, 

and is adding ‘‘expedition of 

proceedings’’ to the title of this Rule to 

reflect the importance of expedition to 

the Part 3 Rules. 

Section 3.11A: Fast-track proceedings. 

In light of the amendments made final 

today, the Commission is rescinding 

Rule 3.11A, which had established 

‘‘fast-track’’ procedures for 

administrative cases when there was a 

collateral federal court proceeding 

under Section 13(b). The Commission 

has used Rule 3.11A to determine at the 

initiation of the litigation if an 

administrative proceeding is 

appropriate for fast-track procedures 

and to notify the respondent if such a 

determination had been made. The 

respondent could then choose the fast 

track procedures if the district court 

entered a preliminary injunction against 

it or if the Commission otherwise 

determined that the evidentiary record 

in the district court proceeding would 

materially facilitate resolution of the 

administrative proceeding. 

The newly-revised Part 3 Rules 

published in the Federal Register on 

January 13, 2009 and made final today 

impose accelerated deadlines 

particularly for those cases in which the 

Commission is also seeking relief under 

Section 13(b). By doing so, the new 

rules obviate the need for the fast-track 

rule in its current form. Moreover, in the 

time since Rule 3.11A was promulgated 

in 1996, respondents have rarely elected 

fast-track procedures. The Commission 

has therefore determined to rescind 

Rule 3.11A. The Commission will 

continue to evaluate the effectiveness of 

its newly-issued Part 3 Rules 

particularly for unconsummated merger 

cases in which a parallel proceeding 

under Section 13(b) has been brought, 

and will consider alternative 

approaches to determine how best to 

expedite such unconsummated merger 

cases in Part 3. 

Section 3.25: Consent agreement 

settlements. 

Rule 3.25 governs motions for 

withdrawal of a matter or portions of a 

matter from adjudication to allow the 

Commission to consider a proposed 

consent agreement. The Commission is 

revising the standards for granting such 

motions, and adding provisions to avoid 

any unnecessary delay in the 

determination. Paragraph (c) retains 

language in former paragraph (c) 

providing that, while a case is pending 

before an ALJ, the Secretary of the 

Commission will automatically 

withdraw the matter or portions of the 

matter if a respondent files a motion to 

withdraw accompanied by a proposed 

consent agreement conforming to Rule 

2.32 that has also been executed by 

complaint counsel and approved by the 

Bureau Director. If respondent’s consent 

agreement was not so executed and 

approved, then former Rule 3.25(d) 

established a process whereby the ALJ 

would decide, depending on the 

likelihood of settlement, whether to 

certify the motion (with his or her 

written recommendation) to the 

Commission, which would then 

determine whether to grant the motion 

for withdrawal. 

The Commission is revising Rule 3.25 

to ensure that the process for 

withdrawal does not unduly delay a 

Part 3 proceeding and to provide the 

Commission with greater latitude in its 

ability to withdraw matters or portions 

of matters from adjudication in order to 

consider a settlement proposal. As 

revised, Rule 3.25(c) requires that the 

ALJ shall certify the motion so long as 

he or she determines that there is a 

reasonable possibility of settlement. The 

previous ‘‘likelihood of settlement’’ 

language imposed too strict a standard 

given the important benefits that a 

consent agreement provides for an 

efficient resolution of a matter. Further, 

the Commission has changed ‘‘may 

certify’’ to ‘‘shall certify,’’ thereby 

removing any suggestion that there 

might be good cause not to certify the 

motion once the ALJ has determined 

that there is a reasonable possibility of 

settlement.2 The Commission is also 

making a corresponding change to Rule 

3.25(b) that allows a respondent’s 

motion for withdrawal to be 

accompanied by a consent proposal, 

even if the consent proposal does not 

conform to the requirements of Rule 

2.32 or has not been executed by 

respondent. 

Rule 3.25(c) now imposes a five-day 

deadline upon the ALJ to determine 

whether he or she will certify the 

motion. The rule also now allows only 

the Commission to order a stay of the 

proceedings once the ALJ has certified 

the motion to withdraw. While the 

Commission should retain the 

discretion to stay a matter or portions of 

a matter for extraordinary 

circumstances, the Commission believes 

that the majority of situations would not 

warrant a stay during this period. 

In addition, the Commission has 

eliminated the requirement that the 

Commission find a ‘‘likelihood of 

settlement’’ before issuing an order 

withdrawing a matter or portions of a 

matter from adjudication. The 

Commission should have the discretion 

to withdraw a matter or portions of a 

matter if it determines that there is 

sufficient prospect for settlement (even 

if not necessarily a ‘‘likelihood’’) to 

warrant a suspension of the 

adjudication. Rather than including a 

specific standard, the revised rule leaves 

it to the Commission’s discretion 

whether to issue the order. Finally, the 

revisions to Rule 3.25(d) clarify that if 

the matter is pending before the 

Commission (rather than an ALJ) when 

the motion and accompanying consent 

proposal are filed, the Commission in its 

discretion may grant the motion for 

withdrawal. 

Section 3.31(g): Inadvertent production. 

Section 3.31 concerns general 

discovery provisions. In its interim 

rules, the Commission issued a new 

provision governing the inadvertent 

production of privileged or protected 

information, which read: ‘‘(g) 

Inadvertent production. The inadvertent 

production of information produced by 

a party or third party in discovery that 

is subject to a claim of privilege or 

immunity for hearing preparation 

material shall not waive such claims as 

to that or other information regarding 

the same subject matter if the 

Administrative Law Judge determines 

that the holder of the claim made efforts 

reasonably designed to protect the 

privilege or the hearing preparation 

material, provided, however, this 

provision shall not apply if the party, or 

an entity related to that party, who 

inadvertently produced the privileged 

information relies upon such 

information to support a claim or 

defense.’’ 

As explained in the rule commentary, 

the Commission determined that this 

provision was necessary to limit the risk 

of subject matter waiver resulting from 

inadvertent disclosure of privileged or 

protected information as long as parties 

have taken reasonable measures to 

protect the information, thereby limiting 

the time and costs incurred by parties to 

avoid waiver. The Commission stated 

that, by treating genuinely inadvertent 

disclosures as not waiving privilege 

Federal Register / Vol. 74, No. 83 / Friday, May 1, 2009 / Rules and Regulations 20207 

3 FTC Act, 6(f), 21(d)(1)(B), 15 U.S.C. 46(f), 57b– 

2(d)(1)(B). 

4 See Pub. L. 110–322 (Sept. 19, 2008), 122 Stat. 

3537. 

5 See Advisory Committee Notes to Fed. R. Evid. 

502. 

6 See Advisory Committee Notes to Fed. R. Evid. 

502. 

claims, the rule revision, along with 

relevant provisions of the FTC Act that 

protect ‘‘privileged or confidential’’ 

information,3 would ensure that 

privileged and protected materials 

obtained by the Commission from both 

respondents and third parties would not 

be publicly disclosed. 

Interim Rule 3.31(g), however, lacks 

some of the protections provided by 

new Fed. R. Evid. 502.4 That rule was 

designed to provide a ‘‘predictable, 

uniform set of standards under which 

parties can determine the consequences 

of disclosure of a communication or 

information covered by the attorneyclient privilege or work-product 

protection.’’5 The Rule was enacted for 

one of the very same reasons that 

prompted the Commission to issue 

interim Rule 3.31(g): Widespread 

concerns that the litigation costs 

necessary to protect against privileged 

or work product materials have become 

excessive due to concerns that any 

disclosure—even if inadvertent or 

minor—will operate as a waiver of 

protections not only for the 

inadvertently disclosed communication 

or information but of the protections for 

all related communications or 

information. This concern is 

particularly aggravated in current 

practice by the enormous amount of 

electronically stored information that 

needs to be reviewed in discovery. 

Fed. R. Evid. 502(b), governing 

inadvertent disclosures, provides that: 

When made in a Federal proceeding 

or to a Federal office or agency, the 

disclosure does not operate as a 

waiver in a Federal or State 

proceeding if: 

1) the disclosure is inadvertent; 

2) the holder of the privilege or 

protection took reasonable steps to 

prevent disclosure; and 

3) the holder promptly took 

reasonable steps to rectify the error, 

including (if applicable) following 

Federal Rule of Civil Procedure 

26(b)(5)(B). 

Fed. R. Civ. P. 26(b)(5)(B), in turn, 

provides that: 

If information produced in discovery 

is subject to a claim of privilege or of 

protection as trial preparation 

material, the party making the claim 

may notify any party that received the 

information of the claim and the basis 

for it. After being notified, a party 

must promptly return, sequester, or 

destroy the specified information and 

any copies it has; must not use or 

disclose the information until the 

claim is resolved; must take 

reasonable steps to retrieve the 

information if the party disclosed it 

before being notified; and may 

promptly present the information to 

the court under seal for a 

determination of the claim. The 

producing party must preserve the 

information until the claim is 

resolved. 

The Advisory Committee noted that 

the rule of evidence adopted the 

approach of a majority of courts 

regarding when an inadvertent 

disclosure results in a waiver, and is 

flexible enough to consider various 

factors such as ‘‘the reasonableness of 

precautions taken, the time taken to 

rectify the error, the scope of discovery, 

the extent of disclosure, and the 

overriding issue of fairness.’’6 Relevant 

considerations concerning the 

reasonableness of precautions taken 

include the number of documents to be 

reviewed, the time constraints for 

production, whether certain advanced 

analytical software application and 

linguistic tools were used for document 

screening, and the implementation of an 

efficient pre-litigation records 

management system. The Advisory 

Committee also noted that Fed. R. Evid. 

502(b) does not require the producing 

party to engage in full-scale postproduction review to determine whether 

there had been an inadvertent 

disclosure, but does require the 

producing party to follow up on any 

‘‘obvious indications’’ that such 

protected materials had been produced 

inadvertently. 

The Commission concludes that the 

standards in Fed. R. Evid. 502(b) in 

combination with the incorporated 

provisions from Fed. R. Civ. P. 

26(b)(5)(B), including the 

reasonableness of efforts to prevent 

disclosure, steps taken by the privilege 

holder to rectify the error, and the 

subsequent obligations imposed on the 

receiving party after receiving the 

information, are sensible and should be 

incorporated into the Commission’s Part 

3 rules. The new federal rule was the 

result of extensive deliberations 

regarding limitations on waiver and was 

approved by Congress as the appropriate 

model for federal and state judicial 

proceedings. The Commission 

concludes that its provisions are equally 

appropriate for its administrative 

proceedings whether the disclosure 

occurs during a Part 3 proceeding or 

during a Commission precomplaint 

investigation. The rule does not address 

any additional obligations that may be 

imposed by state bar rules or opinions 

on attorneys who receive materials that 

appear to be subject to a privilege claim. 

Further, while Fed. R. Evid. 502 is 

expressly limited to the disclosure of 

information protected by the attorneyclient privilege or work product 

doctrine, the Commission concludes 

that the principles underlying that 

provision reasonably should extend in 

Part 3 proceedings to other applicable 

privileges, such as the deliberative 

process privilege. The Commission 

adopts the federal provisions into its 

final Rule 3.31(g)(1). 

The Commission also concludes that 

Fed. R. Evid. 502(a)—governing the 

scope of waiver of privilege for the 

intentional disclosure of information— 

is reasonable and should be 

incorporated into the Commission’s Part 

3 rules. Fed. R. Evid. 502(a) provides 

that: 

When the disclosure is made in a 

Federal proceeding or to a Federal 

office or agency and waives the 

attorney-client privilege or workproduct protection, the waiver 

extends to an undisclosed 

communication or information in a 

Federal or State proceeding only if: 

1) the waiver is intentional; 

2) the disclosed and undisclosed 

communications or information 

concern the same subject matter; and 

3) they ought in fairness to be 

considered together. 

The Advisory Committee noted that 

the voluntary disclosure of privileged or 

protected information or 

communications will result in subject 

matter waiver for undisclosed 

information only in those unusual 

circumstances ‘‘in which fairness 

requires a further disclosure of related 

protected information in order to 

prevent a selective and misleading 

presentation of evidence to the 

disadvantage of an adversary.’’ The 

Commission’s interim Rule 3.31(g), 

providing that an inadvertent 

production will waive protection only 

where a party relies upon the 

information in its case, similarly was 

animated by concerns about the 

unfairness of using selective protected 

materials to the disadvantage of an 

adversary. The Commission concludes 

that the scope of waiver considerations 

encompassed within Fed. R. Evid. 

502(a), which apply to the voluntary 

production of protected materials, are 

reasonable and therefore adopts the 

language of the federal rule in its final 

Rule 3.31(g)(2). 

20208 Federal Register / Vol. 74, No. 83 / Friday, May 1, 2009 / Rules and Regulations 

Section 4.2: Requirements as to form, 

and filing of documents other than 

correspondence. 

In its interim rules, the Commission 

added a new paragraph (c)(4), and 

redesignated existing paragraph (c)(4) as 

(c)(5), to require that filing parties redact 

or omit ‘‘sensitive personal 

information’’ from their filings when 

such information is not needed to 

conduct the proceeding. Sensitive 

personal information, which is also 

protected by the standard protective 

order contained in Appendix A of Rule 

3.31, will be accorded in camera 

treatment pursuant to Rule 3.45 if such 

material is to be introduced as evidence 

or otherwise used in the proceeding. 

The Commission intends that these 

procedures will safeguard the 

confidentiality of sensitive information 

in the event that such information must 

be filed or otherwise used in the 

proceeding. 

The Commission has now determined 

to revise paragraphs (a) through (d) in a 

number of respects. First, paragraph (d) 

has been revised to provide that 

whenever a petition for certain types of 

Commission action in non-Part 3 

matters is filed—such as a petition to 

quash or limit a Commission subpoena 

or civil investigative demand (CID)— 

and confidential treatment is requested, 

a redacted public version of both the 

petition and the showing of justification 

for confidential treatment required by 

Rule 4.9(c) must be filed at the same 

time. A petition that does not satisfy 

these requirements will be rejected by 

the Secretary of the Commission, 

pursuant to Rule 4.2(g), and therefore 

will not suspend performance by the 

petitioner of any pending obligations, 

such as compliance with a pending 

subpoena or CID. The Commission is 

taking this step to address problems 

arising from the recent filing of a 

number of petitions to quash or limit 

subpoenas or CIDs which were marked 

‘‘confidential’’ in their entirety. Because 

the petitions were so designated, the 

Commission was unable to make public 

any part of the petitions at the time they 

were filed, and was unable to make 

public its responses to the petitions 

until after the requests for confidential 

treatment had been addressed. By 

requiring a public version of a petition 

to be filed concurrently with a 

nonpublic version, the revised rule will 

enable the Commission to place 

redacted versions of the petition and the 

Commission’s response on the public 

record without unnecessary delay. As 

revised, paragraph (d) will also facilitate 

Commission evaluation of any given 

request for confidential treatment under 

Rule 4.9(c), by requiring the requester to 

provide a breakdown between the 

public and the confidential components 

of any given request at the time the 

request is filed. 

Second, Rule 4.2 has been revised to 

require all filings with the Commission 

or an ALJ under any Part of Chapter I 

of Title 16 to be labeled clearly and 

accurately as ‘‘Public,’’ ‘‘In Camera,’’ or 

‘‘Confidential’’ at the time they are filed. 

See revised paragraph (b). As a 

corollary, paragraph (d)(3) has been 

revised to permit the Secretary to place 

a document labeled ‘‘Public’’ on the 

public record of the Commission at the 

time it is filed. A significant number of 

requests for action filed with the 

Commission are made public by the 

requesters when filed, frequently by 

placing the requests on the Internet. The 

Commission has no objection to this 

approach; indeed, public disclosure of a 

given request at the time it is filed may 

facilitate the development of a response 

by encouraging interested parties to file 

comments. In some cases, however, 

current Commission rules otherwise 

provide that such requests remain 

confidential until the point at which 

Commission or staff responses are 

issued. Thus, for example, Rule 1.4 

provides that requests for written advice 

‘‘will be [made public] immediately 

after the requesting party has received 

the advice . . . .’’ Revised paragraph 

(d)(3) will resolve this anomaly. 

Third, paragraphs (a) through (d) have 

been revised in a number of respects to 

facilitate the development of a new 

Commission electronic filing system 

under Part 3 of the Rules of Practice, to 

be modeled after the systems adopted by 

a number of federal district courts. See, 

e.g., paragraphs (c)(1), (c)(3), and (d)(1). 

Once operational, this system will 

greatly improve the process by which 

electronic copies of public filings can be 

received, processed, and posted on the 

public Commission Website. In 

addition, the rule has been revised in a 

number of respects to facilitate adapting 

Commission procedures to new 

electronic document formats as they 

arise, such as the increasingly 

widespread use of Adobe portable 

document format, to clarify their scope, 

and to facilitate compliance with their 

requirements. 

Finally, unnecessary language has 

been eliminated, and other revisions 

have been made throughout the rule to 

clarify and limit the kinds of 

submissions to which the rule is 

intended to apply. 

List of Subjects in 16 CFR Part 3 

Administrative practice and 

procedure. 

List of Subjects in 16 CFR Part 4 

Administrative practice and 

procedure. 

■ For the reasons set forth in the 

preamble, the Federal Trade 

Commission amends Title 16, Chapter 1, 

Subchapter A of the Code of Federal 

Regulations, parts 3 and 4, by adopting 

the interim rules published at 74 FR 

1804, January 13, 2009, as final, with 

the following changes: 

PART 3—RULES OF PRACTICE FOR 

ADJUDICATIVE PROCEEDINGS 

■ 1. The authority citation for part 3 

continues to read as follows: 

Authority: 15 U.S.C. 46, unless otherwise 

noted. 

■ 2. Revise § 3.1 to read as follows: 

§ 3.1 Scope of the rules in this part; 

expedition of proceedings. 

The rules in this part govern 

procedure in formal adjudicative 

proceedings. To the extent practicable 

and consistent with requirements of 

law, the Commission’s policy is to 

conduct such proceedings 

expeditiously. In the conduct of such 

proceedings the Administrative Law 

Judge and counsel for all parties shall 

make every effort at each stage of a 

proceeding to avoid delay. In the event 

of a scheduling conflict between a 

proceeding in which the Commission 

also has sought or is seeking relief under 

Section 13(b) of the FTC Act, 15 U.S.C. 

53(b), and another proceeding, the 

proceeding in which the Commission 

also has sought or is seeking relief under 

Section 13(b) shall take precedence. The 

Commission, at any time, or the 

Administrative Law Judge at any time 

prior to the filing of his or her initial 

decision, may, with the consent of the 

parties, shorten any time limit 

prescribed by these Rules of Practice. 

§ 3.11A [Removed] 

■ 3. Remove § 3.11A. 

■ 4. Revise § 3.25 to read as follows: 

§ 3.25 Consent agreement settlements. 

(a) The Administrative Law Judge 

may, in his or her discretion and 

without suspension of prehearing 

procedures, hold conferences for the 

purpose of supervising negotiations for 

the settlement of the case, in whole or 

in part, by way of consent agreement. 

(b) A proposal to settle a matter in 

adjudication by consent shall be 

submitted by way of a motion to 

withdraw the matter from adjudication 

for the purpose of considering a 

proposed settlement. Such motion shall 

be filed with the Secretary of the 

Commission, as provided in § 4.2. Any 

Federal Register / Vol. 74, No. 83 / Friday, May 1, 2009 / Rules and Regulations 20209 

such motion shall be accompanied by a 

consent proposal; the proposal itself, 

however, shall not be placed on the 

public record unless and until it is 

accepted by the Commission as 

provided herein. If the consent proposal 

affects only some of the respondents or 

resolves only some of the charges in 

adjudication, the motion required by 

this paragraph shall so state and shall 

specify the portions of the matter that 

the proposal would resolve. 

(c) If a consent agreement 

accompanying the motion has been 

executed by one or more respondents 

and by complaint counsel, has been 

approved by the appropriate Bureau 

Director, and conforms to § 2.32, and the 

matter is pending before an 

Administrative Law Judge, the Secretary 

shall issue an order withdrawing from 

adjudication those portions of the 

matter that the proposal would resolve 

and all proceedings before the 

Administrative Law Judge shall be 

stayed with respect to such portions, 

pending a determination by the 

Commission pursuant to paragraph (f) of 

this section. If a consent proposal is not 

in the form of a consent agreement 

executed by a respondent, does not 

otherwise conform to § 2.32, or has not 

been executed by complaint counsel, 

and the matter is pending before the 

Administrative Law Judge, he or she 

shall certify the motion and proposal to 

the Commission upon a written 

determination that there is a reasonable 

possibility of settlement. The 

certification may be accompanied by a 

recommendation to the Commission as 

to the disposition of the motion. The 

Administrative Law Judge shall make a 

determination as to whether to certify 

the motion within 5 days after the filing 

of the motion. The filing of a motion 

under paragraph (b) of this section and 

certification thereof to the Commission 

shall not stay proceedings before the 

Administrative Law Judge unless the 

Commission shall so order. Upon 

certification of such motion, the 

Commission in its discretion may issue 

an order withdrawing from adjudication 

those portions of the matter that the 

proposal would resolve for the purpose 

of considering the consent proposal. 

(d) If the matter is no longer pending 

before the Administrative Law Judge, 

the Commission in its discretion may, 

upon motion filed under paragraph (b) 

of this section, issue an order 

withdrawing from adjudication those 

portions of the matter that the proposal 

would resolve for the purpose of 

considering the consent proposal. Such 

order may issue whether or not the 

consent proposal is in the form of a 

consent agreement executed by a 

respondent, otherwise conforms to 

§ 2.32, or has been executed by 

complaint counsel. 

(e) The Commission will treat those 

portions of a matter withdrawn from 

adjudication pursuant to paragraphs (c) 

or (d) of this section as being in a 

nonadjudicative status. Portions not so 

withdrawn shall remain in an 

adjudicative status. 

(f) After some or all of the allegations 

in a matter have been withdrawn from 

adjudication, the Commission may 

accept a proposed consent agreement, 

reject it and return the matter or affected 

portions thereof to adjudication for 

further proceedings, or take such other 

action as it may deem appropriate. If an 

agreement is accepted, it will be 

disposed of as provided in § 2.34 of this 

chapter, except that if, following the 

public comment period provided for in 

§ 2.34, the Commission decides, based 

on comments received or otherwise, to 

withdraw its acceptance of the 

agreement, it will so notify the parties 

and will return to adjudication any 

portions of the matter previously 

withdrawn from adjudication for further 

proceedings or take such other action it 

considers appropriate. 

(g) This rule will not preclude the 

settlement of the case by regular 

adjudicatory process through the filing 

of an admission answer or submission 

of the case to the Administrative Law 

Judge on a stipulation of facts and an 

agreed order. 

■ 5. Amend § 3.31 by revising paragraph 

(g) to read as follows: 

§ 3.31 General discovery provisions. 

* * * * * 

(g) Disclosure of privileged or 

protected information or 

communications; scope of waiver; 

obligations of receiving party. 

(1)(i) The disclosure of privileged or 

protected information or 

communications during a Part 3 

proceeding or during a Commission 

precomplaint investigation shall not 

operate as a waiver if: 

(A) The disclosure is inadvertent; 

(B) The holder of the privilege or 

protection took reasonable steps to 

prevent disclosure; and 

(C) The holder promptly took 

reasonable steps to rectify the error, 

including notifying any party that 

received the information or 

communication of the claim and the 

basis for it. 

(ii) After being notified, the receiving 

party must promptly return, sequester, 

or destroy the specified information and 

any copies it has; must not use or 

disclose the information until the claim 

is resolved; must take reasonable steps 

to retrieve the information if the party 

disclosed it before being notified; and 

may promptly present the information 

to the Administrative Law Judge under 

seal for a determination of the claim. 

The producing party must preserve the 

information until the claim is resolved. 

(2) The disclosure of privileged or 

protected information or 

communications during a Part 3 

proceeding or during a Commission 

precomplaint investigation shall waive 

the privilege or protection as to 

undisclosed information or 

communications only if: 

(i) The waiver is intentional; 

(ii) The disclosed and undisclosed 

information or communications concern 

the same subject matter; and 

(iii) They ought in fairness to be 

considered together. 

* * * * * 

PART 4—MISCELLANEOUS RULES 

■ 1. The authority citation for part 4 

continues to read as follows: 

Authority: 15 U.S.C. 46, unless otherwise 

noted. 

■ 2. Revise § 4.2(a) through (d) to read 

as follows: 

§ 4.2 Requirements as to form, and filing 

of documents other than correspondence. 

(a) Filing. (1) All paper and electronic 

documents filed with the Commission 

or with an Administrative Law Judge 

pursuant to part 0, part 1, part 2, or part 

3 of this chapter shall be filed with the 

Secretary of the Commission, except 

that: 

(i) Documents produced in response 

to compulsory process issued pursuant 

to part 2 or part 3 of this chapter shall 

instead be produced to the custodian, 

deputy custodian, or other person 

prescribed therein, and in the manner 

prescribed therein; and 

(ii) Comments filed in response to a 

Commission request for public comment 

shall instead be filed in the manner 

prescribed in the Federal Register 

document or other Commission 

document containing the request for 

such comment. 

(2) All paper and electronic 

documents filed with the Commission 

pursuant to parts 4–999 of this chapter 

shall be filed with the Secretary of the 

Commission, except as otherwise 

provided in such part. 

(b) Title and public or nonpublic 

status. All paper and electronic 

documents filed with the Commission 

or with an Administrative Law Judge 

pursuant to any part of this chapter 

shall clearly show the file or docket 

number and title of the action in 

connection with which they are filed. 

20210 Federal Register / Vol. 74, No. 83 / Friday, May 1, 2009 / Rules and Regulations 

The first page of each such document 

shall be clearly and accurately labeled 

‘‘Public’’, ‘‘In Camera’’, or 

‘‘Confidential’’. 

(c) Paper and electronic copies of and 

service of filings before the Commission 

or an Administrative Law Judge in 

adjudicative proceedings. 

(1) Each document filed before the 

Commission or an Administrative Law 

Judge in an adjudicative proceeding, 

except documents covered by 

§ 4.2(a)(1)(i), shall be filed with the 

Secretary of the Commission; shall 

comply with the requirements of 

§ 4.2(b); and shall include a paper 

original (in 12-point font with 1-inch 

margins), one paper copy (if before the 

Administrative Law Judge) or twelve 

(12) paper copies (if before the 

Commission), and an electronic copy in 

Adobe portable document format or 

such other format as the Secretary may 

direct. 

(2) If the document is labeled ‘‘In 

Camera’’ or ‘‘Confidential’’, it must 

include as an attachment either a 

motion requesting in camera or other 

confidential treatment, in the form 

prescribed by § 3.45, or a copy of a 

Commission, Administrative Law Judge, 

or federal court order granting such 

treatment. The document must also 

include as a separate attachment a set of 

only those pages of the document on 

which the in camera or otherwise 

confidential material appears and 

comply with all other requirements of 

§ 3.45 and any other applicable rules 

governing in camera treatment. 

(3)(i) If the document is labeled 

‘‘Public’’, the electronic copy shall be 

filed as the Secretary shall direct, or 

through such electronic system as the 

Commission may provide. 

(ii) If the document is labeled ‘‘In 

Camera’’ or ‘‘Confidential’’, the 

electronic copy shall be submitted on a 

compact disc (CD) or digital video disc 

(DVD) so labeled, which shall be 

physically attached to the paper 

original, and shall not be transmitted to 

the Commission by e-mail or any other 

electronic system. 

(iii) Each electronic copy filed 

pursuant to § 4.2(c)(1) shall include a 

certification by the filing party that the 

copy is a true and correct copy of the 

paper original, and that a paper copy 

with an original signature is being filed 

with the Secretary of the Commission 

on the same day by other means. 

(4) Sensitive personal information, as 

defined in § 3.45(b), shall not be 

included in, and must be redacted or 

omitted from, filings where the filing 

party determines that such information 

is not relevant or otherwise necessary 

for the conduct of the proceeding. 

(5) A paper copy of each document 

filed in accordance with this section in 

an adjudicative proceeding shall be 

served by the party filing the document 

or person acting for that party on all 

other parties pursuant to § 4.4, at or 

before the time the original is filed. 

(d) Paper and electronic copies of 

other documents filed with the 

Commission. Each paper or electronic 

document filed with the Commission, 

and not covered by § 4.2(a)(1)(i), 

§ 4.2(a)(1)(ii), or § 4.2(c), shall be filed 

with the Secretary of the Commission, 

and shall be clearly and accurately 

labeled as required by § 4.2(b). 

(1) Each such paper document shall 

be signed, and shall be accompanied by 

an electronic copy on a compact disc 

(CD) or digital video disc (DVD) in 

Adobe portable document format or 

such other format as the Secretary shall 

direct. 

(2) Each such document filed 

pursuant to § 2.7(d), § 2.7(f), § 2.41(f), or 

§ 2.51 shall also include twelve (12) 

paper copies of the signed paper 

original. 

(3) Each such document labeled 

‘‘Public’’ may be placed on the public 

record of the Commission at the time it 

is filed. 

(4) If such a document is labeled 

‘‘Confidential’’, and it is filed pursuant 

to § 2.7(d), § 2.7(f), § 2.41(f), or § 2.51, it 

will be rejected for filing pursuant to 

§ 4.2(g), and will not stay compliance 

with any applicable obligation imposed 

by the Commission or the Commission 

staff, unless the filer simultaneously 

files: 

(i) An explicit request for confidential 

treatment that includes the factual and 

legal basis for the request, identifies the 

specific portions of the document to be 

withheld from the public record, 

provides the name and address of the 

person(s) who should be notified in the 

event the Commission determines to 

disclose some or all of the material 

labeled ‘‘Confidential’’, and otherwise 

conforms to the requirements of § 4.9(c); 

and 

(ii) A redacted public version of the 

document that is clearly labeled 

‘‘Public’’. 

* * * * * 

By direction of the Commission. 

Donald S. Clark, 

Secretary. 

[FR Doc. E9–9972 Filed 4–30–09: 8:45 am] 

BILLING CODE 6750–01–S 

DEPARTMENT OF EDUCATION 

34 CFR Parts 668, 686, 690, and 691 

RIN 1840–AC96 

[Docket ID ED–2009–OPE–0001] 

Student Assistance General 

Provisions; Teacher Education 

Assistance for College and Higher 

Education (TEACH) Grant Program; 

Federal Pell Grant Program; Academic 

Competitiveness Grant Program and 

National Science and Mathematics 

Access To Retain Talent Grant 

Program 

AGENCY: Office of Postsecondary 

Education, Department of Education. 

ACTION: Interim final rule; request for 

comments. 

SUMMARY: The Secretary amends the 

regulations for the Academic 

Competitiveness Grant (ACG) and 

National Science and Mathematics 

Access to Retain Talent Grant (National 

SMART Grant) Programs. These interim 

final regulations are needed to 

implement provisions of the Higher 

Education Act of 1965 (HEA), as 

amended by the Ensuring Continued 

Access to Student Loans Act of 2008 

(ECASLA) and the Higher Education 

Opportunity Act of 2008 (HEOA). The 

new statutory provisions are effective 

July 1, 2009. The Secretary also amends 

the regulations in the Student 

Assistance General Provisions, and the 

regulations for the Teacher Education 

Assistance for College and Higher 

Education (TEACH) Grant Program and 

the Federal Pell Grant Program to 

implement conforming changes based 

on the statutory amendments to the 

ACG and National SMART Grant 

programs. 

DATES: These regulations are effective 

July 1, 2009. We must receive your 

comments on or before June 1, 2009. 

ADDRESSES: Submit your comments 

through the Federal eRulemaking Portal 

or via postal mail, commercial delivery, 

or hand delivery. We will not accept 

comments by fax or by e-mail. Please 

submit your comments only one time, in 

order to ensure that we do not receive 

duplicate copies. In addition, please 

include the Docket ID at the top of your 

comments. 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov to submit 

your comments electronically. 

Information on using Regulations.gov, 

including instructions for accessing 

agency documents, submitting 

comments, and viewing the docket is 

available on the site under ‘‘How To Use 

This Site.’’