In Rare Ruling, Court Permits Discovery Into Motives Behind FTC Subpoena


When a U.S. magistrate judge in the District of Columbia issued his ruling in Federal Trade Commission v. Bisaro on July 13, 2010, permitting limited discovery of certain FTC officials regarding an agency subpoena, it had been more than three decades since the D.C. Circuit had found that “extraordinary circumstances” were present that warranted discovery in a subpoena enforcement action.

Subpoena enforcement proceedings are typically “summary procedures.” However, upon a finding that extraordinary circumstances exist, the court may order limited discovery to ensure that enforcement of the subpoena would not amount to an abuse of process.

In opposing the FTC’s petition to enforce a subpoena requiring him to testify under oath, Paul M. Bisaro, CEO of Watson Pharmaceuticals, moved to compel limited discovery on whether the FTC was acting with an improper purpose in issuing the subpoena. Bisaro argued that the FTC had acted outside the scope of its regulatory and enforcement authority by using the subpoena to pressure Watson to enter a deal with another generic pharmaceutical company.

U.S. Magistrate Judge Alan Kay found the facts in Bisaro “extraordinary enough to grant very limited discovery.”

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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