In stalled FTC case, LabMD seeks immunity for former Tiversa employee to testify

FTC Administrative Law Judge Michael Chappell has granted LabMD’s unopposed motion to seek immunity for a former Tiversa employee to testify in FTC v. LabMD.  The case had been on hold since June when the House Oversight Committee indicated it was investigating the role of Tiversa and its relationship with the FTC. Had that committee granted the former employee immunity for all testimony to them and in the administrative hearing, the case could have proceeded, but Issa’s committee did not grant Rick Wallace immunity and may not have even reached a vote on that question.

Consistent with Chappell’s prior order, LabMD’s counsel now seeks immunity under Commission Rule 3.39. The Department of Justice will have to process the request before any immunity can be granted.

According to the in camera proffer, quoted in part in the order, Wallace is expected to testify that when an FTC lawyer came to Tiversa in Pittsburgh and told Tiversa that finding the 1718 file exposed on LabMD’s work station would not be enough, Wallace was ordered by his employer to create a sheet with four IP addresses where the file was  allegedly found. LabMD alleges that not only are the allegations false, but that they post-date FTC filing a complaint against LabMD. FTC denies the allegations, as does Tiversa’s CEO, Robert Boback, but Judge Chappell acknowledges that the testimony – with its veracity yet to be determined – is crucial to LabMD’s defense and in the public interest.

I’ve uploaded Chappell’s order here (pdf).