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United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 15, 2005 Decided June 10, 2005
No. 05-5009
U.S. INTERNATIONAL TRADE COMMISSION,
APPELLEE
v.
ASAT, INC.,
APPELLANT
Appeal from the United States District Court
for the District of Columbia
(No. 04mc00395)
Matthew J. Brigham argued the cause for appellant. With
him on the briefs was Thomas J. Friel, Jr. and Lori R.E.
Ploeger.
Wayne W. Herrington, Counsel, U.S. International Trade
Commission, argued the cause for appellee. On the brief were
Timothy P. Monaghan, Attorney, and Neal J. Reynolds, Acting
Assistant General Counsel.
2
Louis S. Mastriani and Scott A. Lasher were on the brief for
amici curiae CARSEM (M) SDN BHD, et al. in support of
appellee.
Before: GINSBURG, Chief Judge, and ROGERS and TATEL,
Circuit Judges.
Opinion for the Court filed by Circuit Judge ROGERS.
ROGERS, Circuit Judge: This is an appeal from an order
granting a petition of the United States International Trade
Commission for enforcement of its subpoena for the production
of documents under section 333(b) of the Tariff Act of 1930, 19
U.S.C. § 1333(b) (2000). ASAT, Inc. challenges enforcement
on the grounds that the district court lacked subject matter and
personal jurisdiction, was not the proper venue, and,
alternatively, erred by refusing to review whether ASAT, Inc.
controlled the subpoenaed documents that are in its parent
companies’ possession. Although we hold that the district court
had subject matter jurisdiction and was a proper venue, and that
because section 333(b) of the Tariff Act of 1930 authorizes
nationwide service of process, it also had personal jurisdiction
over ASAT, Inc., we nonetheless reverse the order enforcing the
administrative subpoena because the record lacks sufficient
evidence to determine, as a matter of law, that ASAT, Inc.
controls, and therefore is able to produce, the subpoenaed
documents.
I.
The subpoena underlying this appeal was issued during an
investigation by the United States International Trade
Commission under section 337 of the Tariff Act of 1930, 19
U.S.C. § 1337, of whether the importation of certain
encapsulated integrated circuits by Carsem, Inc., Carsem (M)
Sdn Bhd, and Carsem Semiconductor Sdn Bhd (collectively
3
“Carsem”) infringes three United States patents owned by
Amkor Technology, Inc. (“Amkor”). See In Matter of Certain
Encapsulated Integrated Circuit Devices & Products Containing
Same, Inv. No. 337-TA-501 (U.S.I.T.C.). At the request of
Carsem, an Administrative Law Judge (“ALJ”) issued three
identical subpoenas seeking documents and depositions from
ASAT, Inc., ASAT Limited, and ASAT Holdings Ltd., non-
parties to the investigation that allegedly have documents
relative to Carsem’s likely affirmative defenses. ASAT, Inc. is
a California corporation with headquarters in Pleasanton,
California. It is a wholly-owned subsidiary of both ASAT
Limited, which is a Hong Kong corporation with a principal
office in Hong Kong, and ASAT Holdings Ltd., which is a
Cayman Islands holding corporation with a principal office in
Hong Kong. ASAT Limited is itself also a wholly-owned
subsidiary of ASAT Holdings Ltd. ASAT, Inc.’s principal
activities are the selling, marketing, and provision of customer
services for its parent companies’ integrated circuits in the
United States. Carsem served each subpoena on ASAT, Inc. in
California. The subpoena duces tectum requested a range of
technical and legal documents relating to, among other things,
the prosecution and licensing of two patents - one that is
assigned to ASAT Limited and one that is assigned to Amkor.
ASAT Limited and ASAT Holdings moved to quash the
subpoenas for improper service, and the ALJ granted the motion
because Carsem “ha[d] not shown a lack of corporate
separateness among the three ASAT entities” and ASAT, Inc.
was not a registered agent to accept service on their behalf.
ASAT, Inc. also objected to its subpoena on various grounds,
including that it did not have possession, custody or control of,
or the legal right to obtain, certain documents because they were
in the possession of ASAT Limited or ASAT Holdings Ltd. The
ALJ, noting that ASAT, Inc. is “the exclusive distributor of
ASAT Holdings services in the United States,” found that there
4
was a “close business relationship between the three ASATs”
and ruled that “ASAT Inc. is deemed to be in control of
documents held by ASAT Limited and ASAT Holdings.”
After ASAT, Inc. partially complied with the subpoena but
advised Carsem that it was unable to obtain the relevant
documents from ASAT Limited and ASAT Holdings Ltd.
relating to the cross-licensing arrangement between ASAT
Holdings Ltd. and Amkor on the patents in question, Carsem
moved to certify to the Commission a request for judicial
enforcement of the subpoena. The ALJ agreed, stating that “the
information sought in the subpoena relates to communications
between ASAT and Amkor and the prosecution of the ASAT
and Amkor patents that is relevant to Carsem’s affirmative
defense” and “for which there is no other source.” The ALJ
understood ASAT Inc.’s “flat refusal to comply with the
subpoena . . . [as] a showing of contempt for the Commission’s
discovery processes.” The Commission granted the ALJ’s
request, and, on August 11, 2004, it filed a petition in the district
court for the District of Columbia to enforce the subpoena. The
district court granted the petition, ruling that it had jurisdiction
and that none of ASAT, Inc.’s substantive challenges to the
administrative subpoena fell within the court’s limited scope of
review. U.S. Int’l Trade Comm’n v. ASAT, Inc., 335 F. Supp. 2d
67 (D.D.C. 2004). The district court stayed its enforcement
order, which is a final appealable order, see FTC v. Texaco, Inc.,
555 F.2d 862, 873 n.21 (D.C. Cir. 1977) (en banc), and ASAT,
Inc. now appeals.
II.
Section 333(b) of the Tariff Act provides that the
Commission may require the “attendance of witnesses and the
production of such documentary evidence . . . from any place in
the United States at any designated place of hearing.” 19 U.S.C.
§ 1333(b). Significantly, the subsection further provides:
5
[I]n case of disobedience to a subpoena the
commission may invoke the aid of any district or
territorial court of the United States in requiring the
attendance and testimony of witnesses and the
production of documentary evidence and such court
within the jurisdiction of which such inquiry is carried
on may, in case of contumacy or refusal to obey a
subpoena issued to any corporation or other person,
issue an order requiring such corporation or other
person to appear before the commission, or to produce
documentary evidence if so ordered or to give evidence
touching the matter in question.
Id. (emphasis added). The question whether the district court
has subject matter jurisdiction over an action is generally
distinct from the question whether it was a proper venue in
which the action could be filed. See Neirbo Co. v. Bethlehem
Shipbuilding Corp., 308 U.S. 165, 167-68 (1939); WRIGHT,
MILLER, & COOPER, F EDERAL PRACTICE AND PROCEDURE §
3801 (2d ed. & Supp. 2005); cf. Tex. Mun. Power Agency v.
EPA, 89 F.3d 858, 867 (D.C. Cir. 1996); New Mexico ex rel.
Energy & Minerals Dep’t v. U.S. Dep’t of Interior, 820 F.2d
441, 446 (D.C. Cir. 1987). The former addresses the power of
the court to adjudicate, while the latter addresses the place
where that judicial authority may be exercised and focuses on
the convenience to the parties of the location of the lawsuit.
Neirbo, 308 U.S. at 167-68. However, in the context of section
333(b) of the Tariff Act, the two inquiries merge. Under the
analysis adopted in FEC v. Committee to Elect Lyndon
LaRouche, 613 F.2d 849, 856-57 (D.C. Cir. 1979), the district
court’s subject matter jurisdiction under section 333(b) turns on
whether the Commission’s inquiry was “carried on” in the
judicial district in which the Commission filed its enforcement
action, 19 U.S.C. § 1333(b). In this instance, the court is
required to determine “(1) whether the District of Columbia bore
6
a sufficiently ‘reasonable relation to the subject matter of the
investigation’ to qualify as a place where the inquiry was carried
on, and (2) whether the [Commission’s] choice of this
jurisdiction as its place of inquiry exceeded ‘the bound of
reasonableness.’” LaRouche, 613 F.2d at 856-57 (quoting FTC
v. MacArthur, 532 F.2d 1135, 1140 (7th Cir. 1976)) (internal
citation omitted). Because the second criterion resembles a
traditional venue analysis that focuses on the convenience of the
forum to the parties, see Neirbo, 308 U.S. at 168, it may more
properly be said that the first LaRouche criterion implicates the
district court’s subject matter jurisdiction, while the second
criterion implicates whether that court is a proper venue.
Indeed, in light of Steel Co. v. Citizens for a Better Environment,
523 U.S. 83, 90 (1998), it may be that section 333(b) is properly
viewed not as jurisdictional but as only implicating the district
court’s remedial power. The court suggested, in dictum, in
United States v. Hill, 694 F.2d 258, 267 (D.C. Cir. 1982), where
there was no enforcement provision in the agency statute at
issue, that the general jurisdictional grants in 28 U.S.C. §§ 1331,
1337, 1345 provide the district court with subject matter
jurisdiction over actions to enforce administrative subpoenas.
However, because it is not so clear that Steel Co. is inconsistent
with the characterization of similar statutory language in
LaRouche and FTC v. Browning, 435 F.2d 96 (D.C. Cir. 1970),
this court has no occasion to adopt a different analysis. See
LaShawn A. v. Barry, 87 F.3d 1389, 1395 (D.C. Cir. 1996) (en
banc).
ASAT, Inc. contends that the phrase “such court within the
jurisdiction of which such inquiry” should be interpreted to
include only the location of the “attendance of witnesses and the
production of such documentary evidence,” 19 U.S.C. §
1333(b), and it should not be understood to encompass the
broader investigation into Carsem’s alleged infringing practices.
While the use of the terms “investigation” and “inquiry” in
7
section 333 could suggest that the two terms are not
synonymous, but see FTC v. Jim Walter Corp., 651 F.2d 251,
254 (5th Cir. 1981), abrogated on other grounds by Ins. Corp.
of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694
(1982), ASAT, Inc.’s interpretation ignores the Commission’s
efforts under section 333(b) to obtain the “attendance of
witnesses and the production of such documentary evidence”
that occur outside of the jurisdiction where the subpoena is
directed. ASAT, Inc. provides no justification for such a
confined construction of what constitutes the Commission’s
inquiry, and our caselaw indicates that the place where the
subpoena is returnable is not determinative of the place of
inquiry, see LaRouche, 613 F.2d at 857 n.7. Thus, ASAT, Inc.’s
contention that the Northern District of California is the only
district that has jurisdiction to enforce the Commission’s
subpoena because that is the location where the Commission
sought the production of documents must fail.
Instead “[t]he test whether the Commission is undertaking
an inquiry in a particular place is whether [the] place and the
activities occurring there bear a reasonable relation to the
subject matter of the investigation.” MacArthur, 532 F.2d at
1140. Among the factors relevant to this determination are: the
place where the Commission held its hearing, the place where it
made the decision to authorize the investigation, the place where
the subpoenas were issued, the place where its correspondence
emanated, the place where the Commission determined that
unlawful actions had occurred, the location of the documents
and witnesses, and the location of the headquarters of the
subpoenaed company. See LaRouche, 613 F.2d at 857;
MacArthur, 532 F.2d at 1140; Browning, 435 F.2d at 99. This
test is based on our precedent, and it is consistent with the
Commission’s broad investigatory powers, see 19 U.S.C. §§
1332, 1337; cf. MacArthur, 532 F.2d at 1140.
8
ASAT, Inc. attempts to define the inquiry narrowly and to
minimize the Commission’s activities within the District of
Columbia relating to it, but the district court had subject matter
jurisdiction because “the District of Columbia, where the
Commission maintains its headquarters, was the hub of the
Commission’s investigative activity” of Carsem’s importation
of certain encapsulated circuits. LaRouche, 613 F.2d at 857.
Even if we were to ignore, as ASAT, Inc. suggests, that the
ALJ’s evidentiary hearing regarding Carsem’s actions was held
in the District of Columbia, the Commission’s activities
regarding the subpoena at issue were conducted overwhelmingly
in the District of Columbia: The subpoena was signed, sealed,
and issued in the District of Columbia, the ALJ’s rulings on
ASAT’s motion to quash were issued in the District of
Columbia, and the Commission’s certification of the subpoena
for judicial enforcement occurred in the District of Columbia.
Because, as the district court stated, the Commission conducted
the “administrative activities essential to the investigation in [the
District of Columbia],” ASAT, Inc., 335 F. Supp. 2d at 71, the
district court here had subject matter jurisdiction under section
333(b) of the Tariff Act, see LaRouche, 613 F.2d at 857;
MacArthur, 532 F.2d at 1140.
Although these wholly administrative activities may occur
in the District of Columbia in most, if not all, Commission
inquiries and therefore the district court for the District of
Columbia often, if not always, would have subject matter
jurisdiction, contrary to ASAT Inc.’s contention, this reality
does not rewrite the statute to substitute “the district court for
the District of Columbia” in place of “such court within the
jurisdiction of which such inquiry is carried on” in section
333(b). Instead, as the Commission notes, it is not required to
hold hearings in the District of Columbia. Rather, while the
Tariff Act establishes the Commission’s principal office in the
District of Columbia, 19 U.S.C. § 1331(d), it also authorizes the
9
Commission to maintain an office in New York, id. § 1331(e),
and to “prosecute any inquiry necessary to its duties in any part
of the United States,” id. § 1331(d). And, while the district
court for the District of Columbia may have subject matter
jurisdiction when the Commission conducts its administrative
actions here, our precedent is clear that an inquiry can be carried
on in more than one place. See LaRouche, 613 F.2d at 858 n.9;
Browning, 435 F.2d at 99 n.7. As long as the factors derived
from LaRouche, MacArthur, and Browning so indicate, it
properly can be said that an inquiry is carried on in that place,
and the district court in that judicial district has subject matter
jurisdiction to enforce the Commission’s subpoena.
ASAT, Inc.’s challenge to venue focuses on the
reasonableness of the Commission’s selection of the district
court for the District of Columbia to seek enforcement of its
administrative subpoena. It makes no statutory claim that, as a
non-party to an administrative proceeding, it can determine the
place of enforcement. Cf. Neirbo, 308 U.S. at 618; Miss. Publ’g
Corp. v. Murphree, 326 U.S. 438, 445 (1946). Instead, its
principal concern is that it is “being forced to defend its actions
in remote jurisdictions.” Br. of Appellant at 20. However,
ASAT, Inc. has demonstrated no actual hardship of defending
itself in the District of Columbia, especially since it already had
participated in administrative proceedings in the District of
Columbia. Hence, it is not difficult to conclude that the
Commission’s choice of the District of Columbia to enforce the
subpoena is well-within the “bound of reasonableness.”
LaRouche, 613 F.2d at 857 (quoting MacArthur, 532 F.2d at
1140) (internal quotation marks omitted).
III.
ASAT, Inc.’s challenge to the personal jurisdiction of the
district court is similarly unavailing. Rule 4(k)(1) of the Federal
Rules of Civil Procedure, as relevant, authorizes extra-territorial
10
service of process consistent with the long-arm statute of the
state (or the District of Columbia, see FED . R. CIV. P. 81(e)) in
which the district court sits or as otherwise provided by federal
law. The Commission does not maintain that the District of
Columbia’s long-arm statutes, e.g., D.C. CODE ANN. §§ 13-423,
13-334 (2001), authorized service of process on ASAT, Inc. in
California, but it instead contends that section 333(b) of the
Tariff Act, which permits enforcement of Commission
subpoenas by district or territorial courts “within the jurisdiction
of which such inquiry is carried on,” 19 U.S.C. § 1333(b),
authorizes nationwide service of process in actions to enforce
Commission subpoenas.
On two occasions the court has confronted identical or
strikingly similar language in other statutes and concluded that
Congress intended to imply nationwide service of process. In
Browning, the court interpreted the identical language of section
9 of the Federal Trade Commission Act, 15 U.S.C. § 49, and
held that:
by granting the power to enforce subpoenas only to
those district courts ‘within the jurisdiction of which
such inquiry is carried on,’ Section 9 so limits the place
of suit for enforcement of Federal Trade Commission
subpoenas as to require an implied grant of authority
for extra-territorial service of process in order to
effectuate the purpose of the regulatory scheme.
Browning, 435 F.2d at 100. Similarly, in LaRouche, the court
held that “the reasoning of the Browning decision [was] equally
applicable” to “virtually identical” language in the Federal
Election Campaign Act of 1971, 613 F.2d at 659, 862, where
Congress had limited jurisdiction for actions to enforce Federal
Election Commission subpoenas to district courts “within the
jurisdiction of which any inquiry is being carried on,” 2 U.S.C.
11
§ 437d(b).
Thus, with such similar statutory language in the Tariff Act
and the Commission’s nationwide jurisdiction to conduct
investigations, Browning and LaRouche compel the conclusion
that nationwide service of process exists for subpoena
enforcement actions under section 333(b) of the Tariff Act.
ASAT, Inc. contends, however, that the Supreme Court’s
decision in Omni Capital Int’l v. Rudolf Wolff & Co, Ltd., 484
U.S. 97 (1987), alters this analysis. In Omni Capital, the Court
held that the Commodity Exchange Act did not authorize
nationwide service of process for private causes of action under
that statute. That decision, however, does not undermine the
Commission’s position that the Tariff Act provides nationwide
service of process for subpoena enforcement actions.
First, in Omni Capital, the Supreme Court found it
significant that although the Commodity Exchange Act’s
provision authorizing a private cause of action was silent as to
service of process, other enforcement provisions in the statute
expressly provided for nationwide service of process. Id. at 106.
With the Commodity Exchange Act, all Congress had to do was
use the same language it had used in other sections within the
same statute to indicate its desire for nationwide service of
process; its failure to do so was strong evidence of its intent not
to authorize nationwide service of process. See id. at 106-07.
The same cannot be said of the Tariff Act, where Congress has
been completely silent as to service of process. Silence
throughout the statute is weaker evidence of congressional intent
to preclude nationwide service of process than in Omni Capital
because there is no indication that Congress considered and
rejected nationwide service of process for actions under section
333(b). While Omni Capital demonstrates that Congress knows
how to provide for nationwide service of process expressly and
its failure to do so here counsels against implying nationwide
12
service of process lightly, such express language is unnecessary
when it is clear, as discussed below, that Congress would have
desired nationwide service of process to effectuate the
underlying statute’s purpose.
Second, Omni Capital involved a private cause of action, as
opposed to agency enforcement proceedings, as in Browning,
LaRouche, and the instant case. The Commission maintains this
distinction is important because without nationwide service of
process, “Congress would have provided the [district] [c]ourt
with the authority to hear the enforcement proceeding but not
the power to enforce the subpoena in question.” Br. of Appellee
at 25. For example, the Commission states that the lack of
nationwide service of process would frustrate its congressionally
mandated purpose of conducting nationwide investigations, see
19 U.S.C. §§ 1332, 1337, because the District of Columbia was
the only place where the inquiry was carried on in this matter
and therefore the only place that it could file an action to
enforce its subpoena under section 333(b). ASAT, Inc. responds
that so long as the subpoena seeks documents in a location other
than the place of hearing, there will always be multiple places
where the inquiry is carried on. Although it is true that the
Commission’s inquiry could be carried on in more than one
place, see LaRouche, 613 F.2d at 858 n.9; Browning, 435 F.2d
at 99 n.7, that does not mean that in every instance an inquiry
will be carried on in multiple places or that the inquiry will be
carried on in the place where the subpoenaed documents are
located. This is so because the location of the subpoenaed
documents, even if it is also the place where the subpoena is
returnable, may not be a place of inquiry under the factors
derived from LaRouche, MacArthur, and Browning. See, e.g,
Jim Walter Corp., 651 F.2d at 255.
We conclude, therefore, that it is necessary to imply
nationwide service of process for actions to enforce Commission
13
subpoenas under section 333(b) of the Tariff Act because there
otherwise could be a gap in the Commission’s enforcement
regime where no judicial district could enforce a Commission
subpoena without the party voluntarily submitting to the court’s
jurisdiction. However, to the extent the Commission justifies
nationwide service of process as necessary to avoid having to go
from judicial district to judicial district to enforce its subpoenas
against recalcitrant witnesses or reluctant document producers,
that contention erroneously presupposes that going from judicial
district to judicial district, although inefficient and inconvenient,
would result in the enforcement of every Commission subpoena.
In any event, in Hill, 694 F.2d at 269, the court suggested that
policy arguments regarding the most efficient or convenient
enforcement of Commission subpoenas are best addressed to
Congress. But see MacArthur, 532 F.2d at 1141.
Finally, relying on the Supreme Court’s statement in Omni
Capital that it “would consider it unwise for a court to make its
own rule authorizing service of summons,” 484 U.S. at 109,
ASAT, Inc. contends that the Court disapproved of implying
nationwide service of process. The Supreme Court, however,
made that statement after concluding that the Commodity
Exchange Act did not impliedly authorize nationwide service of
process and while discussing whether “the federal courts should
act to fill the ‘interstices in the law inadvertently left by
legislative enactment’ by creating their own rule authorizing
service of process.” Id. at 108 (quoting Point Landing, Inc. v.
Omni Capital Int’l, Ltd., 795 F.2d 415, 431-32 (5th Cir. 1986)).
Relying on our precedent, we have determined that Congress
impliedly authorized nationwide service of process for subpoena
enforcement actions under section 333(b) of the Tariff Act, and
therefore we have located the “legislative grant of authority
[that] is necessary.” Id. at 109 (citing Georgia v. Pa. R.R. Co.,
324 U.S. 439, 467-68 (1945)).
14
Consequently, nothing in Omni Capital alters our
conclusion that section 333(b) of the Tariff Act impliedly
authorizes nationwide service of process in actions to enforce
the Commission’s subpoenas.
IV.
ASAT, Inc.’s final contention is that even if the district
court had jurisdiction and was a proper venue for this
enforcement action, the subpoena still should not be enforced
because ASAT, Inc. lacks control of the subpoenaed documents.
This court typically reviews a district court’s decision to enforce
an administrative subpoena for abuse of discretion. See, e.g.,
FTC v. GlaxoSmithKline, 294 F.3d 141, 146 (D.C. Cir. 2002).
However, because ASAT, Inc. contends the district court applied
the wrong legal standard, our review is de novo. Cf. In Re
Sealed Case, 146 F.3d 881, 883 (D.C. Cir. 1998). Because
ASAT Inc.’s challenge to the Commission’s authority requires
the court to address only a question of law – namely whether the
ALJ’s findings of fact are sufficient to give rise to a reasonable
inference that ASAT, Inc. had control of the subpoenaed
documents – a remand to the district court is unnecessary. See,
e.g., Empagran S.A. v. F. Hoffman-LaRoche, Ltd., 388 F.3d 337,
345 (D.C. Cir. 2004).
In a series of cases the Supreme Court has limited the
district court’s role in enforcing an administrative subpoena,
beginning with Endicott Johnson Corp. v. Perkins, 317 U.S.
501, 509 (1943), and Oklahoma Press Publishing Co. v.
Walling, 327 U.S. 186, 209 (1946). Most relevantly, in United
States v. Morton Salt Co., 338 U.S. 632 (1950), in the context of
the Federal Trade Commission’s investigatory powers to require
reports, the Supreme Court confined the judicial role to
determining whether “the inquiry is within the authority of the
agency, the demand is not too indefinite and the information
sought is reasonably relevant.” Id. at 652-53; see also United
15
States v. Powell, 379 U.S. 48, 57-58 (1964). With this
instruction, this court has held, in light “of the important
governmental interest in the expeditious investigation of
possible unlawful activity,” that the district court’s role is
“strictly limited.” Texaco, 555 F.2d at 872. The court has
explained, however, that “[a]lthough the investigative powers of
regulatory agencies are broad, they are not unlimited, and are
subject to judicial review ‘[t]o protect against mistaken or
arbitrary orders.’” In re FTC Line of Bus. Report Litig., 595
F.2d 685, 702 (D.C. Cir. 1978) (quoting Morton Salt, 338 U.S.
at 640); see also United States v. Markwood, 48 F.3d 969, 979
(6th Cir. 1995); Burlington N. Ry. Co. v. Office of Inspector
Gen., 983 F.2d 631, 638 (5th Cir. 1993); United States v. Int’l
Union of Petroleum & Indus. Workers, 870 F.2d 1450 (9th Cir.
1989); cf. Univ. Medicine & Dentistry N.J. v. Corrigan, 347
F.3d 57, 64 (3d Cir. 2003). But see United States v. Am. Target
Adver., Inc., 257 F.3d 348, 354 (4th Cir. 2001). See generally
EEOC v. United Airlines, Inc., 287 F.3d 643 (7th Cir. 2002).
ASAT, Inc. argued both in the district court and in this court
that it does not have control over the subpoenaed documents and
consequently, “[e]ven a deferential review of an ALJ finding
requires an analysis of whether the administrative subpoena
‘transcend[s] the agency’s investigatory power.’” Br. of
Appellant at 23 (quoting In re FTC Line of Bus. Report Litig.,
595 F.2d at 703). The district court, interpreting its limited role
in subpoena enforcement proceedings, refused “to revisit the
ALJ’s findings” that ASAT, Inc. had “control over the
documents in the possession of its corporate relatives.” ASAT,
Inc., 335 F. Supp. 2d at 72. However, the Commission does not
have authority under its regulations to subpoena documents from
ASAT, Inc. that are beyond ASAT, Inc.’s control, see 19 C.F.R.
§§ 210.30(a)(1), .32(b); cf. FED . R. CIV. P. 34(a)(1), and, of
course, the Commission is bound by its regulations, see, e.g.,
United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260, 267
16
(1954); Battle v. FAA, 393 F.3d 1330, 1336 (D.C. Cir. 2005).
Although the Supreme Court has circumscribed the district
court’s authority in proceedings to enforce administrative
subpoenas, the Court has not gone so far as to preclude the
district court from examining whether the Commission exceeded
its authority in light of ASAT, Inc.’s challenge to the ALJ’s
determination that it had control of the subpoenaed documents.
The parties agree that Camden Iron & Metal, Inc. v.
Marubeni America Corp., 138 F.R.D. 438 (D.N.J. 1991), sets
forth the applicable grounds for finding control of documents.
“‘Control’ is defined as the legal right, authority or ability to
obtain documents upon demand.” Id. at 441; see also SEC v.
Credit Bancorp, Ltd., 194 F.R.D. 469, 471 (S.D.N.Y. 2000);
WRIGH T , MILLER & COOPER, 8A FEDERAL PRACTICE &
PROCEDURE § 2210. Camden Iron indicates that courts have
concluded that a subsidiary corporation, like ASAT, Inc., has the
requisite control of documents that are in a parent company’s
possession where:
(1) the alter ego doctrine . . . warranted ‘piercing the
corporate veil’;
(2) the subsidiary was an agent of the parent in the
transaction giving rise to the lawsuit;
(3) [t]he relationship is such that the agent-subsidiary
can secure documents of the principal-parent to meet
its own business needs and documents helpful for use
in litigation;
(4) [t]here is access to documents when the need arises
in the ordinary course of business; and
(5) [the] subsidiary was [a] marketer and servicer of
the parent’s product (aircraft) in the United States.
138 F.R.C. at 441-42 (citing Gerling Int’l Ins. Co. v. Comm’r of
Internal Revenue, 839 F.2d 131, 140-41 (3d Cir. 1988)). It is the
17
Commission’s burden to establish that ASAT, Inc. has control
of the subpoenaed documents. See id. at 441; see also Int’l
Union of Petroleum & Indus. Workers, 870 F.2d at 1452.
The parties do not dispute that the subpoenaed documents
are not in ASAT, Inc.’s possession or custody, but instead are
possessed by one of ASAT, Inc.’s parent companies. The
Commission, like the ALJ, therefore relies on the fourth and
fifth grounds from Camden Irons to justify enforcing the
subpoena. The ALJ ruled that the fourth Camden Irons ground
applied because of the “close business relationship between the
three ASATs.” The ALJ also deemed ASAT, Inc. to control the
relevant documents under the fifth Camden Irons ground
because its principal activities on behalf of its parent companies
are sales, marketing and the provision of customer services.
Although ASAT, Inc.’s opening brief only expressly referenced
the fourth ground, as its counsel indicated during oral argument,
both the fourth and fifth grounds are challenged here, as they
were in the district court, for lack of a nexus between ASAT,
Inc.’s ordinary business and the subpoenaed documents. See Br.
of Appellant at 26-27; Reply Br. of Appellant at 15-17. This is
so because the fifth ground essentially describes what ASAT,
Inc. does in the ordinary course of business, which is exactly the
issue that ASAT, Inc. addressed in its opening brief.
Our review of the record and the ALJ’s factual findings do
not reveal support for a determination of control as a matter of
law. As an initial matter, the ALJ failed to explain the apparent
inconsistency between his two findings that “Carsem has not
shown a lack of corporate separateness among the three ASAT
entities,” and that there was such a “close business relationship
between the three ASATs” so as to deem ASAT, Inc. as having
control of its parent companies’ documents. More importantly,
neither the ALJ’s findings, nor the record, indicate whether
ASAT Inc.’s relationship with its parent companies would give
18
it access to the subpoenaed documents in the ordinary course of
business. As noted, the subpoenaed documents principally
relate to the prosecution and licensing of patents assigned to
ASAT Limited and Amkor. The record only vaguely indicates
that ASAT, Inc.’s “principal activities” are “sales, marketing
and customer services,” and it does not provide any context or
explanation for why ASAT, Inc. would have access to or even
need documents relating to a patent that it has not been assigned.
Simply because the ASATs share some documents during the
ordinary course of business is insufficient to deem ASAT, Inc.
as having control over the documents underlying the patents at
issue. See Camden, 138 F.R.D. at 442. While “the particular
form of the corporate relationship does not govern whether [a
corporation] controls documents,” Credit Bancorp, 194 F.R.D.
at 472, the ALJ’s ruling comes close to deeming all wholly
owned subsidiaries engaged in sales and servicing as controlling
their parent company’s documents. Such a result would be
impracticable. Instead, there must be a nexus between the
subpoenaed documents and ASAT, Inc.’s relationship with its
parent companies, taking into account, among other things,
ASAT, Inc.’s business responsibilities.
For similar reasons, the fifth Camden Irons ground, whose
origin is Cooper Industries, Inc. v. British Aerospace, Inc., 102
F.R.D. 918 (S.D.N.Y. 1984), is also unsupported by the record.
In Cooper Industries, the wholly owned subsidiary was the
distributor and servicer of its parent company’s airplanes in the
United States, and the subpoenaed documents were service
manuals and blueprints related to those airplanes. Id. at 919.
Because the subpoenaed documents “relate[d] to the planes that
[the subsidiary] work[ed] with every day,” the district court
found it “inconceivable that [the subsidiary] would not have
access to these documents and the ability to obtain them for its
usual business.” Id. at 919-20. Here, however, although the
nature of the relationship between ASAT, Inc. and its parent
19
companies may be comparable to the relationship in Cooper
Industries, the nature of the subpoenaed documents is manifestly
different. It is quite conceivable that ASAT, Inc. does not have
routine access to these documents because they do not seem to
relate directly to its principal activities. As another of the
Commission’s ALJs recognized in In the Matter of Certain
Optical Disk Controller Chips & Chipsets & Prods. Containing
Same, 2004 WL 2311060 (U.S.I.T.C. Oct. 5, 2004), merely
being a “sales and service” subsidiary does not establish the
subsidiary’s control over documents and information in the
parent’s possession.
The Commission acknowledges there must be a nexus
between the supoenaed documents and ASAT, Inc.’s business
responsibilities with its parent companies, maintaining that
“ASAT, Inc. could reasonably be expected to be provided
access to the documents of its two affiliates during the course of
this patent litigation, given that the litigation might clearly and
directly impact the ability of ASAT, Inc. to sell and service the
products of ASAT Holdings and ASAT Limited in the United
States.” Br. of Appellee at 14. However, this conclusion stands
for the untenable position that any subsidiary whose business
life may be threatened has the ability to control its parent’s
documents, and it appears to be based on pure speculation
without support in the record. The same is true for the
Commission’s position that, “as the exclusive operating arm of
ASAT Holdings and ASAT Limited in the United States, ASAT,
Inc. has the most direct interest in U.S. patent rights and licenses
owned by ASAT Holdings and ASAT Limited of which it may
be the beneficiary.” Id. at 39-40. This may be so, but the record
is not there to support such a finding. It remains for the
Commission either to instruct the ALJ to reopen the record to
allow further evidence and, based on modified findings by the
ALJ, to bring a separate petition for enforcement, or to seek the
documents directly from ASAT Holdings and ASAT Limited
20
through the Hague Convention protocols for obtaining
documents from foreign corporations, see FED . R. CIV. P. 4(f) &
Advisory Comm. Notes (1993).
Accordingly, we hold that the district court had subject
matter and personal jurisdiction and was a proper venue for
enforcement of the Commission’s subpoena against ASAT, Inc.,
but the court erred in refusing to review the ALJ’s determination
regarding control. Because the ALJ’s factual findings and the
record are insufficient to support a determination as a matter of
law that ASAT, Inc. has control of the subpoenaed documents,
we reverse the order enforcing the Commission’s subpoena.