Filed: May 02, 2012
Latest Update: Feb. 12, 2020
Summary: UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 11-1568 In Re: KOLON INDUSTRIES INCORPORATED, Petitioner. On Petition for Writ of Mandamus. (3:09-cv-00058-REP) No. 11-1570 E. I. DUPONT DE NEMOURS & COMPANY, Plaintiff – Appellee, v. KOLON INDUSTRIES INCORPORATED, Defendant – Appellant, and KOLON USA INCORPORATED, Defendant, and ARAMID FIBER SYSTEMS LLC, Third Party Defendant. Appeal from the United States District Court for the Eastern District of Virginia, at Richmond. Rob
Summary: UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 11-1568 In Re: KOLON INDUSTRIES INCORPORATED, Petitioner. On Petition for Writ of Mandamus. (3:09-cv-00058-REP) No. 11-1570 E. I. DUPONT DE NEMOURS & COMPANY, Plaintiff – Appellee, v. KOLON INDUSTRIES INCORPORATED, Defendant – Appellant, and KOLON USA INCORPORATED, Defendant, and ARAMID FIBER SYSTEMS LLC, Third Party Defendant. Appeal from the United States District Court for the Eastern District of Virginia, at Richmond. Robe..
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 11-1568
In Re: KOLON INDUSTRIES INCORPORATED,
Petitioner.
On Petition for Writ of Mandamus. (3:09-cv-00058-REP)
No. 11-1570
E. I. DUPONT DE NEMOURS & COMPANY,
Plaintiff – Appellee,
v.
KOLON INDUSTRIES INCORPORATED,
Defendant – Appellant,
and
KOLON USA INCORPORATED,
Defendant,
and
ARAMID FIBER SYSTEMS LLC,
Third Party Defendant.
Appeal from the United States District Court for the Eastern
District of Virginia, at Richmond. Robert E. Payne, Senior
District Judge. (3:09-cv-00058-REP)
Argued: January 24, 2012 Decided: May 2, 2012
Before SHEDD, DAVIS, and DIAZ, Circuit Judges.
Affirmed by unpublished opinion. Judge Shedd wrote the opinion,
in which Judge Davis and Judge Diaz joined.
ARGUED: Stephen Blake Kinnaird, PAUL HASTINGS LLP, Washington,
D.C., for Kolon Industries Incorporated. Clifton Scott
Elgarten, CROWELL & MORING, LLP, Washington, D.C., for E.I. du
Pont de Nemours & Company. ON BRIEF: Jeffrey G. Randall, Igor
V. Timofeyev, PAUL HASTINGS LLP, Washington, D.C., for Kolon
Industries Incorporated. Michael J. Songer, Stephen M. Byers,
CROWELL & MORING, LLP, Washington, D.C.; Brian C. Riopelle,
Rodney A. Satterwhite, Thomas M. Beshere, MCGUIREWOODS LLP,
Richmond, Virginia, for E.I. du Pont de Nemours & Company.
Unpublished opinions are not binding precedent in this circuit.
2
SHEDD, Circuit Judge:
Kolon Industries (“Kolon”) appeals from the modification of
a protective order in a civil action brought against it by E.I.
Dupont De Nemours & Co. (“DuPont”) for trade secret
misappropriation. In an effort to respond to related
proceedings brought by South Korean governmental agencies,
DuPont sought a modification of a previously entered protective
order in this action. The district court granted the
modification and exempted the following from the protective
order’s scope:
(i) a party’s own documents provided to the Korean
federal prosecutor or Korean Federal Trade Commission
(“KFTC”); (ii) documents requested by the Korean
federal prosecutor or KFTC; (iii) deposition testimony
of any witness in this case provided to the Korean
federal prosecutor or KFTC; or (iv) documents that a
party provides to the Korean federal prosecutor or
KFTC to address allegations against that party.
J.A. 501-502.
Kolon now appeals the district court’s entry of this
modified protective order. Before addressing Kolon’s challenge,
we must decide whether we have jurisdiction to hear this appeal.
We have jurisdiction to hear “appeals from all final decisions
of the district courts of the United States.” 28 U.S.C. § 1291.
“Consequently, appellate review will generally be limited to
those decisions which end the litigation on the merits and leave
nothing for the court to do but execute the judgment.” MDK,
3
Inc. v. Mike’s Train House, Inc.,
27 F.3d 116, 119 (4th Cir.
1994)(internal citations and citation marks omitted). While
“[d]iscovery orders generally do not meet this requirement,” the
collateral order doctrine provides an exception to this rule.
Id. It recognizes that “final decisions . . . also include a
small set of prejudgment orders that are ‘collateral to’ the
merits of an action and ‘too important’ to be denied immediate
review.” Mohawk Indus., Inc. v. Carpenter,
130 S. Ct. 599, 603
(2009) (citing Cohen v. Beneficial Industrial Loan Corp.,
337
U.S. 541, 546 (1949)). We have articulated the standard for
application of the collateral order doctrine as follows:
In this circuit, an order will fall within this
limited exception only if the order [1] conclusively
determines the question in the trial court, [2]
resolves an important question independent of the
subject matter of the litigation, [3] is effectively
unreviewable on appeal from a final judgment or so
important that review should not wait upon final
judgment, and [4] presents a serious and unsettled
question upon appeal.
MDK, 27 F.3d at 120. (internal citations and citation marks
omitted).
On appeal, the parties do not dispute that the modification
order satisfies the first, second, and fourth prong of our
collateral order doctrine. Therefore, the only question is
whether the modification order fulfills the third prong. In
analyzing this prong, “[t]he crucial question, however, is not
whether an interest is important in the abstract; it is whether
4
deferring review until final judgment so imperils the interest
as to justify the cost of allowing immediate appeal of the
entire class of relevant orders.”
Mohawk, 130 S. Ct. at 606.
In Mohawk, the Court recognized two avenues in which
discovery disputes can be addressed in the normal course of
litigation. A party can “defy a disclosure order and incur
court-imposed sanctions.”
Id. at 608. Alternatively,
“[a]ppellate courts can remedy the improper disclosure of
privileged material in the same way they remedy a host of other
erroneous evidentiary rulings: by vacating an adverse judgment
and remanding for a new trial.”
Id. at 606-607.
However, neither of these approaches is effective in this
case. First, the modified protective order does not compel
Kolon to do anything; it merely allows DuPont to disclose
documents it already possesses. Thus, Kolon itself cannot force
reviewable sanctions by its own actions. Second, the normal
course of appellate review cannot remedy the harm that could
befall a party with the release of privileged documents which
could lead to possible criminal investigation and prosecution by
a foreign government.
Therefore, we find that when privileged documents are
released to a foreign government in these circumstances,
deferring review imperils the interest of justice because no
other mechanism exists to sufficiently protect the litigants’
5
rights. In short, the district court’s order is effectively
unreviewable and, thus, we have jurisdiction to review it
pursuant to the collateral order doctrine. See
Cohen, 337 U.S.
at 546 (finding a collateral order appealable when the “claims
of right separable from, and collateral to, rights asserted in
the action, [are] too important to be denied review and too
independent of the cause itself to require that appellate
consideration be deferred until the whole case is adjudicated”).
Having concluded that we have jurisdiction, we now turn to
Kolon’s substantive challenge to the district court’s
modification order. Federal Rule of Civil Procedure 26(c)(1)
permits a district court to enter a protective order “for good
cause.” A district court has inherent “discretionary authority
to modify [a protective order] for what it deems good cause
shown.” United States v. (Under Seal),
794 F.2d 920, 928 n.6
(4th Cir. 1986). We review the exercise of such authority for
an abuse of discretion. See Pittston Co. v. United States,
368
F.3d 385, 406 (4th Cir. 2004).
In the present case, Kolon and DuPont voluntarily entered
into an agreed protective order. Later, upon DuPont’s motion,
the district court conducted a thorough analysis of the facts
and the changed situation between DuPont and Kolon. The court
decided to modify the protective order so as to “level the
playing field and enable full fair and efficient consideration
6
of issues pertinent to the [Korean] investigations.” J.A. 497.
After reviewing the district court’s analysis, we find that the
court did not abuse its discretion in finding good cause to
modify the protective order. See, Gambale v. Deutsche Bank AG,
377 F.3d 133, 141 (2nd Cir. 2004) (“[A] protective order . . .
is always subject to the inherent power of the district court .
. . This retained power in the court to alter its own ongoing
directives provides a safety valve for . . . changed
circumstances[.]”). Thus, we affirm the district court’s order. *
AFFIRMED
*
Kolon also filed a petition for a writ of mandamus.
Because we have granted appellate review in this matter, we deny
that petition.
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