CIT Judge Vaden Questions ITC Redaction Process in Lengthy Hearing

NEW YORK -- In a marathon four-and-a-half hour oral argument session last week, Court of International Trade Judge Stephen Vaden sharply questioned the International Trade Commission's redaction process in an injury proceeding on phosphate fertilizers (OCP v. United States, CIT Consol. # 21-00219).

Opening the hearing by declaring "none of us should be here in this courtroom today," the judge repeatedly expressed his disapproval of what he believed to be the over-redaction of information by the commission. Vaden told the 12 attorneys who came to discuss the ITC's practice that the policies had created a “sad situation” in which pages of information that he thought should have been made public were unnecessarily redacted.

Vaden questioned two ITC lawyers for the first three hours. First was Dominic Bianchi, the ITC’s general counsel, who fielded questions from Vaden regarding the legal background of the ITC’s practice. Vaden focused on the ITC's redaction of pages of information from questionnaire responses that he said could be found on participating companies’ own websites and Securities and Exchange Commission filings as well as in popular news sources such as The Wall Street Journal and USA Today.

The judge noted a decision of his from earlier this year in a separate injury case, in which he rejected a U.S. request to redact information in an opinion sustaining the affirmative injury finding (see 2401090046). That decision is being appealed on the question of whether a judge can unilaterally unredact information.

Bianchi noted that the ITC doesn’t have the authority to go back through the administrative record once it’s closed to make public information that was originally redacted. To this, Vaden said that the ITC has an affirmative duty to go through the record before it closes and ensure that the information is not needlessly redacted. After Bianchi pointed to the administrative burden this would cause, Vaden cited to a U.S. Court of Appeals for the D.C. Circuit decision in declaring that “administrative burden is not an excuse to not follow the law.”

The ITC general counsel explained that the commission made confidential anything submitted in questionnaires that the submitting company saw fit to bracket as being confidential. Vaden noted that any such redactions are still subject to the ITC’s restrictions that the veiled information not be publicly available or cause competitive harm if released to the public.

The ITC’s defense was twofold: the public variation of the redacted information didn't relate to the exact product that was under review, and providing public access to the information would have harmed the ITC’s ability to solicit information from parties in the future.

On the first point, Bianchi said that, since the redacted information, which referred to a narrowly defined domestic like product, was not directly the same as the information found on companies’ websites about their general operations, it could cause harm if not kept confidential. Vaden said that was a “hyper-technical argument” that belied the central question of whether the information isn’t already publicly available or could cause competitive harm.

Vaden asked if, from his position, it’s acceptable that a Wall Street Journal article, which is not confidential under the ITC’s own regulations and “any sensible definition of confidential information,” be treated as confidential? Bianchi said that “obviously, it is not.”

Up next was ITC lawyer Courtney McNamara, who went through the record document-by-document with Vaden. McNamara initially urged the court to move to a closed session for fear of revealing any confidential information.

Vaden dismissed the concern, saying all the information he sought to review was either found on the companies’ own websites or in their own SEC filings. During the hearing, the judge showed the courtroom information from the companies themselves in order to contrast it with the redacted information found in the record.

At one point in the exchange, the judge projected information regarding a U.S. company’s net sales in various countries taken from the firm’s website, even though the information had been redacted by the ITC. This prompted another protest from McNamara, as well as Bianchi, about the potential leak of information. Vaden again rejected the concern because the information could be found on the company’s website.

With the session kept open, Vaden went through each redacted document, at one point holding up a sheet of completely blacked-out text, to discuss whether it should have been redacted. The information included data on the amount of sales U.S. companies do in other countries, the types of distribution methods they use, the locations of distribution sites and more.

McNamara echoed the agency’s defenses, noting that the redacted information in the questionnaires was slightly different from the information the judge projected on the court’s two large screens since it related to specific products, where the projected information concerned a broader range of products.

“This is not some type of game,” Vaden said, telling the ITC it still has to find whether the redacted information would cause competitive harm if released. McNamara said that it’s not for the commission to make this decision, adding that the ITC would suffer irreparable harm if it reviewed every piece of information in this way and made this information public.

She cited 19 C.F.R. 201.6, which defines confidential business information as all sorts of information, “the disclosure of which is likely to have the effect of either impairing the Commission's ability to obtain such information as is necessary to perform its statutory functions, or causing substantial harm to the competitive position of the person, firm, partnership, corporation, or other organization from which the information was obtained.”

In two instances, McNamara conceded that an error had been made. In one, a word was redacted in one area but unredacted in another. The other involved information on how long it took the submitting parties’ attorney to complete the questionnaire. The ITC conceded that this information may be made public by the court.

The judge also heard from Jeffrey Kessler and Jameson Grier, counsel to U.S. phosphate fertilizer companies The Mosaic Company and J.R. Simplot, respectively.

Both Kessler and Grier said that their clients have “extreme” concerns about confidentiality. Both attorneys defended the commission’s practice, saying that anything more burdensome would hurt its ability to collect information from many different parties.

Kessler said the ITC also has a long-standing practice of affording all bracketed questionnaire responses confidentiality. Vaden responded by saying that “Al Capone had a long-standing practice of not paying income taxes. That did not make it legal.”

Saying “we’ve always done it this way” is not an answer, the judge said. “It’s an excuse.”

Vaden also said it’s “not intuitive” to him how the ITC can bracket certain information that’s virtually the same in public without legislative or regulatory backing. The judge then said he would give parties a chance to make written statements -- an opportunity they didn't have before the hearing. Vaden brought the agency before the court before the submission of any written briefs and, in his order summoning the agency, suggested the possibility of Rule 11 sanctions (see 2403060053).

The parties decided that the ITC’s brief will be due in 40 days and that responses from the foreign exporters and U.S. companies will be due two weeks after the ITC’s brief is submitted.