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Order enforcing criminal subpoenas for foreign-originating evidence possessed by U.S. counsel may have far-reaching implications

20 December 2010

In a development that should be of great interest to all lawyers and companies – foreign and domestic – involved in litigation in the United States, a recent Ninth Circuit decision confirmed that the risks associated with bringing foreign-originating evidence into the U.S. – even for what is believed to be a limited purpose – are very real and could result in that evidence being subpoenaed for use in a criminal investigation. On 7 December the Court of Appeals for the Ninth Circuit ordered several law firms acting for defendants in the Liquid Crystal Display (LCD) civil class action to turn over documents produced in that litigation to a grand jury charged with reviewing the defendants' behavior for potential criminal liability stemming from the same underlying events. The Court found that documents that would otherwise fall outside the grand jury's subpoena authority must be produced if "by a chance of litigation, the documents have been moved from outside the grasp of the grand jury to within its grasp. No authority forbids the government from closing its grip on what lies within the jurisdiction of the grand jury." The risk is not limited to defendants in antitrust cases; the same rationale would seem to apply to any situation in which related civil and criminal matters temporally overlap. Foreign defendants could be required to produce foreign documents under risk of sanctions in a civil suit, knowing that the government could then subpoena those same otherwise-undiscoverable documents for use in a criminal investigation.



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