FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
IN RE: OPTICAL DISK DRIVE No. 14-17502
ANTITRUST LITIGATION,
D.C. No.
3:10-md-02143-
DELL INC.; DELL PRODUCTS, L.P.; RS
HEWLETT-PACKARD COMPANY;
INGRAM MICRO, INC.; SYNNEX
CORPORATION; ACER AMERICA OPINION
CORP.; GATEWAY, INC.; GATEWAY
U.S. RETAIL, INC., FKA eMachines,
Inc.; STATE OF FLORIDA, Office of
the Attorney General, Department of
Legal Affairs; AARON WAGNER;
CHRIS JOHNSON; EVAN JACOBSON;
LISA MELEGARI; BARNEY
GOODMAN, JR.; BENJAMIN MURRAY;
THOMAS STENGER; JAMES ITO-
ADLER; SANDRA STEFFEN; ALEX
BISSEN; BENJAMIN FABER;
MATTHEW HOSKING; CINDY BOOZE;
MATTHEW ENCE; EVAN RAVENELLE;
MICHAEL REILLY; SUSIE LIM;
ANGELA PRITCHARD; MIKE BISHOP;
KIMBERLY WOOD; BENJAMIN
PORTER; GAIL MURPHY; JOHN
MCKEE, on behalf of themselves and
all others similarly situated; JLK
SYSTEMS GROUP, INC.; JEFF KOZIK;
MEIJER, INC.; MEIJER DISTRIBUTION,
INC.; PAUL NORDINE; SENECA DATA
2 IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG.
DISTRIBUTORS, INC.; GREGORY
STARRETT; ASHLEY TREMBLAY, on
behalf of themselves and all others
similarly situated,
Plaintiffs-Appellees,
v.
TOSHIBA SAMSUNG STORAGE
TECHNOLOGY CORP. KOREA, as
Liaison Counsel for Defendants, et
al.,
Defendants,
and
JOHN DOE 1,
Appellant.
Appeal from the United States District Court
for the Northern District of California
Richard Seeborg, District Judge, Presiding
Argued and Submitted
July 6, 2015—San Francisco, California
Filed September 10, 2015
Before: Richard C. Tallman, Milan D. Smith, Jr.,
and Mary H. Murguia, Circuit Judges.
Opinion by Judge Milan D. Smith, Jr.
IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG. 3
SUMMARY*
Discovery / Subpoenas
The panel affirmed the district court’s denial of a motion
to quash a civil subpoena to the Department of Justice,
Antitrust Division, from plaintiffs in an antitrust suit against
optical disk drive manufacturers.
The subpoena sought tape recordings and transcripts of
conversations that included the movant, “John Doe,” who was
not a party to the antitrust suit. The FBI made these secret
recordings two months before the grand jury issued a
subpoena to Doe during a criminal investigation that preceded
the antitrust suit. Doe was an employee of one of the
companies being investigated.
The panel held that the tape recordings were not protected
by Federal Rule of Criminal Procedure 6(e) because they
were not “matters occurring before the grand jury.” The
panel declined to follow other circuits and adopt the “effect
test,” which requires a factual inquiry, on a document-by-
document basis, to determine whether disclosure of a
particular requested item will reveal some aspect of the inner
workings of the grand jury. In addition, Doe offered no
evidence showing that the disclosure of the tape recordings
would compromise the integrity of the grand jury’s
deliberative process.
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
4 IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG.
COUNSEL
Sean F. O’Shea (argued) and Daniel M. Hibshoosh, O’Shea
Partners LLP, New York, New York, for Interested Non-
Party Appellant.
Jeff D. Friedman (argued) and Shana E. Scarlett, Hagens
Berman Sobol Shapiro LLP, Berkeley, California; Steve W.
Berman, Hagens Berman Sobol Shapiro LLP, Seattle,
Washington; Guido Saveri, R. Alexander Saveri, and Cadio
Zirpoli, Saveri & Saveri, Inc., San Francisco, California; Lee
Gordon, Hagens Berman Sobol Shapiro LLP, Pasadena,
California, for Indirect and Direct Purchaser Plaintiffs-
Appellees.
Michael P. Kenny, Debra D. Bernstein, Rodney J. Ganske,
and Andrew J. Tuck, Alston & Bird LLP, Atlanta, Georgia;
James M. Wagstaffe, Kerr & Wagstaffe LLP, San Francisco,
California, for Plaintffs-Appellees Dell Inc. and Dell Products
L.P.
Daniel A. Sasse, Crowell & Moring LLP, Irvine, California;
Beatrice B. Nguyen, Crowell & Moring LLP, San Francisco,
California, for Plaintiffs-Appellees Hewlett-Packard
Company, Ingram Micro Inc., and Synnex Corporation.
David B. Esau, Carlton Fields Jorden Burt, West Palm Beach,
Florida, for Plaintiffs-Appellees Acer America Corp.,
Gateway, Inc., and Gateway U.S. Retail, Inc., FKA
eMachines, Inc.
Daniel M. Wall, Belinda S. Lee, and Brendan A. McShane,
Latham & Watkins LLP, San Francisco, California, for
IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG. 5
Defendant Toshiba Samsung Storage Technology Korea
Corporation.
Lizabeth A. Brady, Nicholas J. Weilharnmer, and R. Scott
Palmer, State of Florida, Office of the Attorney General,
Department of Legal Affairs, Tallahassee, Florida, for
Plaintiff-Appellee State of Florida.
Christopher Ries, United States Department of Justice,
Antitrust Division, San Francisco, California; Ila C. Deiss,
United States Attorney’s Office, San Francisco, California,
for Non-Party United States Department of Justice, Antitrust
Division.
OPINION
M. SMITH, Circuit Judge:
Interested Non-Party John Doe 1 (Doe) appeals from the
district court’s order denying his motion to quash a subpoena
from Plaintiffs-Appellees Dell, Inc., et al. (Dell Plaintiffs)1 to
the Department of Justice, Antitrust Division (DOJ). As part
of a criminal antitrust investigation into the optical disc drive
industry,2 the FBI made secret tape recordings and transcripts
of conversations among various individuals, including Doe,
an employee of one of the companies being investigated.
Doe, who was initially designated as a subject of the grand
jury investigation hearing for the potential antitrust case, was
1
The plaintiffs in this case include Direct Purchaser Plaintiffs (DPPS),
Indirect Purchaser Plaintiffs (IPPs) and Direct Action Plaintiffs (DAPs).
2
The antitrust investigation is not the subject of this appeal.
6 IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG.
not indicted. After the grand jury investigation concluded
with corporate pleas and a settlement, the Dell Plaintiffs, in
a collateral civil antitrust suit against certain optical disk
drive manufacturers, subpoenaed the DOJ seeking
“recordings of conversations” and “verbatim transcripts”
relating to the DOJ’s investigation of those manufacturers.
The FBI had made the tape recordings two months before the
grand jury issued its subpoena to Doe seeking his testimony.
Doe moved to quash the subsequent civil subpoena pursuant
to Federal Rule of Criminal Procedure 6(e), which prohibits
disclosure of “a matter occurring before the grand jury.” Fed.
R. Crim. P. 6(e). Doe argued that no protective order would
protect his interest in not having his identity and the content
of those tapes revealed. The district court denied Doe’s
motion, concluding that Rule 6(e) did not apply because the
recordings at issue are not “a matter occurring before the
grand jury” within the definition of material protected by the
rule. We agree, and hold that the tape recordings at issue in
this case are not “matters occurring before the grand jury,”
and, therefore, are not protected by Rule 6(e). Doe contends
erroneously that the district court abused its discretion by
failing to apply the “effect test,” which requires the court to
“make a factual inquiry on a document-by-document basis”
to determine “whether disclosure of a particular requested
item will reveal some secret aspect of the inner workings of
the grand jury.” United States v. Dynavac, Inc., 6 F.3d 1407,
1413 (9th Cir. 1993). We did not adopt the “effect test” in
Dynavac, and we decline to do so now. Moreover, Doe has
offered no evidence showing that the disclosure of the tape
recordings would compromise “the integrity of the grand
jury’s deliberative process.” Id. at 1414.
We affirm the decision of the district court.
IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG. 7
FACTUAL AND PROCEDURAL BACKGROUND
The Dell Plaintiffs served a subpoena on the DOJ
requesting the production of secret tape recordings and
transcripts of conversations that were part of an earlier,
completed DOJ criminal antitrust investigation into the
optical disc drive industry. As required by the “Touhy
regulations,”3 the DOJ objected to the subpoena on a variety
of grounds, including “to the extent it demands information
that would violate the grand jury secrecy rule of Rule 6(e) of
the Federal Rules of Criminal Procedure.” However,
following negotiations, the DOJ agreed to produce the tapes
to the Dell Plaintiffs under the terms of a protective order.
Doe, who is not a party to the civil suit, intervened and sought
to quash the subpoena that requested recordings and
transcripts of conversations to which Doe was a party. Doe
argued that the subpoena “must be quashed because it
purports to require the production of secret recordings of []
Doe that, irrespective of their specific contents, would
seriously harm and possibly destroy his personal and
professional reputation, and quite possibly deprive him of his
livelihood.”
Acting under an order of reference from the district court,
the magistrate judge disagreed, and denied Doe’s motion to
quash, but issued an order stating that “the materials at issue
(recordings) shall not be produced until an appropriate
3
“[I]n determining whether production or disclosure should be made
pursuant to a demand,” DOJ officials “should consider” “[w]hether such
disclosure is appropriate under the rules of procedure governing the case
or matter in which the demand arose,” and “[w]hether disclosure is
appropriate under the relevant substantive law concerning privilege.”
28 C.F.R. § 16.26(a)(1)–(2) (also known as the “Touhy regulations.”).
8 IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG.
supplemental stipulated protective order is signed.” The
magistrate judge rejected the argument “that just because an
agent goes out and gets some evidence in an investigation, . . .
it’s grand jury material,” concluding that Rule 6(e) did not
apply to the subpoenaed material.
The district court affirmed the magistrate judge’s
decision, noting that “[a] district court will modify a
magistrate judge’s ruling on a non-dispositive matter only if
the order is ‘clearly erroneous’ or ‘contrary to law.’” Order
Overruling Objections to Nondispositive Pretrial Order of
Magistrate Judge Re Production of Recorded Conversations,
In Re Optical Disk Drive Antitrust Litigation, No. 3:10-md-
2143 RS, at 1 (N.D. Ca. December 19, 2014) (citation
omitted). The court focused on “what constitutes ‘grand jury
materials’ in the first instance,” identifying as the key
component, “matters occurring before the grand jury(.)” Id.
at 2 (quoting Sec. & Exch. Comm’n v. Dresser Indus., Inc.,
628 F.2d 1368, 1382 (D.C. Cir. 1980)). The court held that
“the record does not support a conclusion that the recordings
in dispute constitute ‘matters occurring before the grand jury’
within the meaning of this rule” because “while it might be
reasonable to assume that some or all of the recordings were
presented to the grand jury, nothing in the subpoena seeks to
discover what the grand jury actually did or did not have
before it.” The court further noted that “[p]roduction of all
material responsive to the subpoena likewise would not
establish that any or all of those materials were ever
presented to the grand jury, much less shed light on its inner
workings.” See Dynavac, 6 F.3d at 1411–12. While the
district court did not explicitly apply the “effect test,” it did
apply some of the “principles” of that test to the factual
record before it, focusing on whether releasing the recordings
IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG. 9
would reveal “some secret aspect of the grand jury’s
investigation.”
Doe filed this timely appeal.
JURISDICTION AND STANDARD OF REVIEW
We have jurisdiction over this appeal pursuant to Perlman
v. United States, 247 U.S. 7, 13 (1918). “The Perlman rule
has been formulated as providing a right of immediate appeal
by a party aggrieved by a district court discovery order
whenever the order requires a third party to produce evidence
or documents and that third party cannot be expected to go
into contempt merely to create a final appealable order.” In
re Nat’l Mortg. Equity Corp. Mortgage Pool Certificates
Litig., 857 F.2d 1238, 1240 (9th Cir. 1988). The district
court’s order in this case does not compel Doe to produce
evidence, but the Perlman doctrine has been applied to
situations like this one where a third party (e.g., Doe) must
rely on another third party (e.g., the DOJ) to protect his
interests in the discovery process. See In re Grand Jury
Subpoenas Dated Dec. 10, 1987, 926 F.2d 847, 854 (9th Cir.
1991) (“Doe Three must rely on Doe Four to protect his
interests. Doe Four, however, elected to comply with the
subpoenas. The only way to assure Doe Three that his
interests will be protected is to allow him to take an
immediate appeal from the order denying his motion to quash
the subpoenas.”).
We will overturn the district court’s denial of a motion to
reconsider the magistrate judge’s pretrial discovery order
only if the denial was “clearly erroneous or contrary to law.”
Osband v. Woodford, 290 F.3d 1036, 1041 (9th Cir. 2002)
(quoting 28 U.S.C. § 636(b)(1)(A)). Applying this standard,
10 IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG.
“a reviewing court must ask whether, ‘on the entire
evidence,’ it is ‘left with the definite and firm conviction that
a mistake has been committed.’” Easley v. Cromartie,
532 U.S. 234, 242 (2001) (quoting United States v. United
States Gypsum Co., 333 U.S. 364, 395 (1948)).
DISCUSSION
Doe contends that the district court abused its discretion
by (1) failing to apply the “effect test” to determine whether
the recordings were protected grand jury materials;
(2) making unsupported factual findings about the
circumstances underlying the creation and use of these
recordings; and (3) abandoning its “supervisory role” under
the Federal Rules of Criminal Procedure, and deferring to the
DOJ’s ultimate decision, “which has previously, and since,
been contradicted by its own written statements,” to produce
the recordings called for by the subpoena. We disagree.
The district court’s denial of Doe’s motion to reconsider
the magistrate judge’s pretrial discovery order was not
“clearly erroneous or contrary to law.” Federal Rule of
Criminal Procedure 6(e)(2)(B) prohibits “an attorney for the
government” from “disclos[ing] a matter occurring before the
grand jury.” Doe argues erroneously that to determine what
constitutes a “matter occurring before the grand jury,” the
district court should have applied the “controlling legal
standard—the “effect test,” which “determines whether
disclosure of a particular requested item will reveal some
secret aspect of the inner workings of the grand jury.”
Dynavac, 6 F.3d at 1413 (citing In re Grand Jury Matter
(Catania), 682 F.2d 61, 63 (3d Cir. 1982)). Doe further notes
that “the district court applied an exception to Rule 6(e)
allowing production of pre-existing documents created
IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG. 11
independently of the grand jury process.” We have never
adopted the “effect test,” and we decline to do so now. We
acknowledge, however, as does Doe, that the pre-existing
documents exception shares at least one characteristic of the
“effect test” by focusing on whether “the integrity of the
grand jury’s deliberative process would . . . be compromised
by . . . disclos[ing]” the pre-existing documents as a factor
relevant to determining whether Rule 6(e) applies. Dynavac,
6 F.3d at 1414.
In Dynavac, we identified “[v]arious different tests [that]
have been utilized by other circuits,” including the “effect
test” adopted by the Third, Fourth, Seventh, Eighth, Tenth,
and D.C. Circuits. Id. at 1412. We noted that “[i]n its
strength lies its weakness . . . because . . . its application
requires considerable judicial time and resources, and the ad
hoc nature of the test limits the value of precedent for both
litigants and courts.” Id. at 1413. We never adopted the
“effect test,” concluding instead that the grand jury’s
deliberative process in that case would not be compromised
by the disclosure of business records that predated the grand
jury investigation. Id. at 1414. Said differently, Dynavac
does not require application of the “effect test,” but it
suggests that some of the considerations inherent in the
“effect test” may be relevant to deciding whether the
protections of Rule 6(e) apply to documents that pre-date a
grand jury investigation.
While the “long-established policy of nondisclosure” in
part “act[s] as a shield for those who are exonerated by the
grand jury,” the fundamental purpose of Rule 6(e) is
“only to protect against disclosure of what is
said or takes place in the grand jury room . . .
12 IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG.
it is not the purpose of the Rule to foreclose
from all future revelation to proper authorities
the same information or documents which
were presented to the grand jury.” United
States v. Interstate Dress Carriers, Inc.,
280 F.2d 52, 54 (2d Cir. 1960). Thus, if a
document is sought for its own sake rather
than to learn what took place before the grand
jury, and if its disclosure will not compromise
the integrity of the grand jury process, Rule
6(e) does not prohibit its release.
Dynavac, 6 F.3d at 1411–12 (alteration in original). The
subpoena at issue here seeks only to discover “recordings of
conversations in which a present or former officer, director or
employee of Defendant PLDS was one of the participants,”
not what took place before the grand jury. Indeed, as the
district court noted, “Production of all material responsive to
the subpoena . . . would not establish that any or all of those
materials were ever presented to the grand jury, much less
shed light on its inner workings.” Because we have not
adopted the “effect test” in our circuit, the district court
properly focused its attention on the language of Rule 6(e),
“the factual record” before it, and Dynavac’s emphasis on
protecting the disclosure of grand jury processes.
Next, Doe argues that the district court made unsupported
factual findings about the circumstances underlying the
creation and use of the recordings. Doe contends that the
district court erred in relying “on a narrow set of cases
finding Rule 6(e) inapplicable to the production of pre-
existing documents, which happened to have been shown to
a grand jury.” As an initial matter, we note that Doe’s
argument is premised on the faulty assertion, discussed supra,
IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG. 13
that “despite finding an exception for pre-existing documents,
those cases still hold that the required inquiry is the effect
test.” In addition, Doe argues that “it is undisputed that the
subpoenaed recordings were created for the grand jury
investigation by a DOJ witness acting under the FBI’s
supervision,” and that “these facts are a far cry from cases
which permit the disclosure of pre-existing business records
and other materials. . . .” We disagree.
The mere fact that the subpoenaed recordings were
created as part of a criminal investigation using a cooperating
witness acting under the FBI’s supervision does not
automatically trigger Rule 6(e) protection. “[M]atters
occurring before the grand jury” could conceivably include
“information obtained by a government official who, in
pursuing an investigation that is not truly independent of the
grand jury’s inquiry, has become an agent of the grand jury.”
United States v. Flemmi, 233 F. Supp.2d 113, 115 (D. Mass.
2000); see also In re Grand Jury Subpoena, 103 F.3d 234,
238 (2d Cir. 1996). But that is not what occurred here.
The consensually recorded telephone conversation was
authorized and occurred two months before the grand jury
ever issued a subpoena in June 2009. It is even theoretically
possible that a grand jury might never have been empaneled.
As our sister circuits have recognized, “information
developed by the FBI, although perhaps developed with an
eye toward ultimate use in a grand jury proceeding, exists
apart from and was developed independently of grand jury
processes.” Catania, 682 F.2d at 64; see also In re Grand
Jury Investigation, 630 F.2d 996, 1000 (3d Cir. 1980) (“The
mere fact that a particular document is reviewed by a grand
jury does not convert it into a ‘matter occurring before the
grand jury’ within the meaning of Rule 6(e).”); Sec. & Exch.
14 IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG.
Comm’n v. Dresser Indus., Inc., 628 F.2d 1368, 1382 (D.C.
Cir. 1980) (“[W]hen testimony or data is sought for its own
sake for its intrinsic value in furtherance of a lawful
investigation rather than to learn what took place before the
grand jury, it is not a valid defense to disclosure that the same
information was revealed to a grand jury.”).
Rule 6(e)’s protections apply to a narrower set of
materials than Doe suggests; indeed, “it is not the purpose of
the Rule to foreclose from all future revelation to proper
authorities the same information or documents which were
presented to the grand jury.” Dynavac, 6 F.3d at 1411
(quoting Dress Carriers, Inc., 280 F.2d at 54). Doe has not
demonstrated that the tape recordings and transcripts were a
product of the grand jury’s investigation, much less that their
revelation would compromise the integrity of the grand jury’s
deliberative process. See id. at 1414.
Finally, Doe characterizes “[t]he district court’s deference
to DOJ’s agreement to produce these materials” as “egregious
given DOJ’s own written statements making clear the privacy
interests and applicability of Rule 6(e) to the subpoenaed
materials.” The district court properly exercised its discretion
in concluding that the DOJ’s initial objections to the
subpoena, expressed in a letter, were not dispositive. The
DOJ objected to the subpoena “to the extent it demands
information that would violate the grand jury secrecy rule of
Rule 6(e)[.]” The DOJ subsequently negotiated with the Dell
Plaintiffs and “made clear . . . that it would not negotiate or
discuss anything that was grand jury material.” The parties
then “reached an agreement on the general terms of
production of the recordings and transcripts.” The district
court did not abuse its discretion in concluding that Rule 6(e)
was not implicated by the production of the tape recordings
IN RE: OPTICAL DISK DRIVE ANTITRUST LITIG. 15
pursuant to a negotiated protective order in which Doe’s
counsel was invited to participate.
CONCLUSION
We affirm the decision of the district court denying Doe’s
motion to quash the subpoena. The pending motion is denied
as moot.
Each party shall bear its own costs on appeal.
AFFIRMED.