The Case of the Day is In re Grand Jury Subpoena (4th Cir. 2011). Because the case involves a grand jury proceeding, the opinion does not disclose the identities of the relevant parties. It seems likely to me, based on a press release from the U.S. Attorney for the Eastern District of Virginia, that “Company 1” is Kolon Industries, Inc., a Korean company, that “Company 2” is E.I. du Pont de Nemours & Co., and that the “former employee” is Michael David Mitchell. But I can’t be sure of that.

According to the opinion, the former employee, who had worked for Company 2, became a consultant to Company 1. In 2007, the government began to investigate the former employee for theft of trade secrets, and the former employee pleaded guilty to theft of trade secrets and obstruction of justice in December 2009. Company 2 sued Company 1 for trade secret misappropriation. The government’s investigation of the former employee led it to investigate Company 1 as well. So both the government and Company 2 were seeking to hold Company 1 accountable for the alleged trade secret misappropriation.

In the civil litigation, Company 1 and Company 2 had agreed to an “attorney’s eyes only” protective order, a fairly common device in IP litigation that allows the parties’ lawyers to exchange information freely in discovery while minimizing the risk that competitive information one company produces in discovery will end up being used against it in the marketplace. The case of the day arose because the grand jury issued a subpoena to Company 2 seeking to obtain the documents that Company 1 had produced to it in the civil case. Company 1 moved to quash the subpoena. Company 2 intervened on behalf of the government. The district court denied the motion to quash.

On appeal, the interesting point, for our purposes, was this: Company 1 argued that the government, by making use of the grand jury subpoena, was attempting to circumvent the restrictions on discovery in criminal matters in the mutual legal assistance treaty between the United States and Company 1’s home country (if my guess as to the identity of the parties is correct, Korea). The court dismissed this argument on the grounds that the government was not seeking discovery from Company 1; it was seeking discovery from Company 2. Moreover, even if the government had sought discovery from Company 1, the MLAT has an express provision limiting its applicability to discovery sought via the MLAT process.