Metal Container Corporation

Plain-English summary

OSHA alleged excessive noise in four areas of Metal Container's plant and sought a discovery inspection to evaluate engineering controls. The company asserted that innovative machines and processes were trade secrets, and the judge limited the inspection team to federal employees. Applying Owens-Illinois, the Commission vacated that restriction because an outside expert may participate when an appropriate protective order and enforceable contractual rights adequately protect confidential information. The case was remanded for further discovery proceedings under that framework. Commissioner Barnako partly dissented because he would require the Secretary to show good cause before using a nonfederal expert after trade secrets were established.

Decision snapshot

• Cited standard(s): The decision describes an excessive-noise citation but does not identify the cited standard by number.
• Outcome: The federal-employee-only discovery order was vacated and the case was remanded under Owens-Illinois.
• Key point: Trade-secret protection can be achieved through enforceable safeguards without categorically barring nonfederal experts from a discovery inspection.

Full text (OSHRC public release)

Docket No. 76-1220

METAL CONTAINER CORPORATION

OSHRC Docket No. 76-1220

Occupational Safety and Health Review Commission

February 28, 1979

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Before CLEARY, Chairman; BARNAKO and COTTINE, Commissioners.
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COUNSEL:

Baruch A. Fellner, Office of the Solicitor, USDOL

Bobbye D. Spears, Reg. Sol., USDOL

Knut C. Heise, Metal Container Corporation, for the employer

A. Graham Allen, for the employer

OPINIONBY: CLEARY

OPINION:

DECISION

CLEARY, Chairman:

This case is before the Commission on the Secretary of Labor's interlocutory appeal of Administrative Law Judge Cecil L. Cutler, Jr.'s order granting the Secretary's motion to compel entry into Metal Container's Jacksonville, Florida, plant for a discovery inspection but limiting the Secretary to the use of experts who are employees of the federal government.

The citation alleges that employees in four areas of the plant were exposed to excessive noise levels and that feasible engineering or administrative controls were not utilized to reduce noise. The Secretary made a motion to compel entry upon respondent's premises for inspection and testing so that his potential witness could inspect the four areas listed in the citation and evaluate the feasibility of engineering controls.
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Metal Container agreed to this motion if the persons conducting the discovery inspection were federal employees subject to [*2]
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the provisions of 18 U.S.C. �
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1905; but moved to limit the Secretary to federal employees, claiming that it possessed innovative machines and processes which were extremely confidential and arguing that disclosure of this information to an outside expert would endanger its confidentiality.
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Respondent submitted an affidavit to support its claim of trade secrets. Judge Cutler found that respondent did have trade secrets and entered an order allowing a discovery inspection but limiting the participants to federal employees. The judge relied on Reynolds Metals, Co., 78 OSAHRC 51/F1, 3 BNA OSHC 1749, 1975-76 CCH OSHD P20,214 (No. 4385, 1975), where the Commission held on interlocutory appeal that, absent a showing of good cause why it is necessary to use outside experts, only federal employees could be used to conduct a discovery inspection where trade secrets were likely to be disclosed.

We find that the issues presented here are governed by our recent decision in Owens-Illinois, Inc., 78 OSAHRC 105/C8, 6 BNA OSHC 2162, 1978-79 CCH OSHD P23,218 (No. 77-648, 1978) ("Owens").
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In that case we held that the possibility of disclosure of trade secrets to an expert who is not [*3]
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a federal employee does not preclude granting a motion for entry upon respondent's land for discovery purposes so long as the respondent's trade secrets are adequately protected. We concluded in Owens that trade secrets could be adequately protected by appropriate protective orders and a provision in the Secretary's contract with the outside expert that would allow the employer an enforceable third-party beneficiary interest.
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Owens described the manner in which a trade secrets claim should be raised by an employer.
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It also set forth the procedure to be followed when an employer's trade secrets claim is disputed by the Secretary, as well as the minimum requirements of an acceptable protective order. To the extent that Reynolds Metals is inconsistent with Owens it was overruled.

Accordingly, the judge's order is vacated and this case is remanded for further proceedings consistent with the Commission decision in Owens. So ORDERED.
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CONCURBY: BARNAKO (In Part)

DISSENTBY: BARNAKO (In Part)

DISSENT:

BARNAKO, Commissioner, Concurring in part and Dissenting in part:

I dissent from the majority's order insofar as the majority concludes that the Secretary may use a non-Federal expert to conduct
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the requested discovery regardless of good cause and adhere to the views I expressed in Owens-Illinois, Inc., 78 OSAHRC 105/C8, 6 BNA 2162, 1978-79 CCH OSHD P23,218 (No. 77-648, 1978), adopting my position in Reynolds Metals Co., 78 OSAHRC 51/F1, 3 BNA OSHC 1749, 1975-76, CCH OSHD P20,214 (No. 4385, 1975) and the Commission's subsequent decision in the same case.
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78 OSAHRC 41/D4, 6 BNA OSHC 1667, 1978 CCH OSHD P22,806 (1978). If Metal Container proves the existence of trade secrets that would be endangered by a discovery inspection, then the Secretary must show good cause why it is necessary to use a non-Federal expert.
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If the Secretary fails in this respect, I would limit him to the use of a Federal expert to conduct the requested discovery. If the Secretary were to show good cause for the use of non-Federal experts, I would agree to entry of a protective order meeting the requirements set forth in Owens. n1

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n1 I agree with the majority that the procedures to be followed by the judge with respect to determining the existence of trade secrets that may be disclosed by a discovery inspection are those set forth in Owens. Moreover, because the proceedings below arose prior to the Commission decision in that case, I would afford the parties a further opportunity to state their positions and submit additional affidavits.
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However, if the judge finds trade secrets likely to be disclosed, then he should determine whether good cause exists for the use of a non-Federal expert.
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We note in this respect that the Secretary asserted that he had good cause to use a non-Federal expert to conduct the discovery since the search he had made to find a federal noise expert in another case, Reynolds Metals Co., 78 OSAHRC 51/F1, 3 BNA OSHC 1749, 1975-76 CCH OSHD P20,214 (No. 4385, 1975), had disclosed no such experts in the Federal government.
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No ruling was made by the judge below on this issue.

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