James McLoughlin from Moore & Van Allen sets out his views on the recent Servotronics Inc vs Boeing Co decision from the U.S. Court of Appeals for the Fourth Circuit. This decision aligned itself with the September 2019 decision by the U.S. Court of Appeals for the Sixth Circuit, Abdul Latif Jameel Transportation Company Limited vs FedEx Corporation, on the use of Title 28, Section 1782, “Assistance to foreign and international tribunals and to litigants before such tribunals.”
Not being a lawyer, I am not going to comment on the legal issues of the case, which the author covers in detail in the article and I would suggest a thorough read of the article to help with that, but I believe it is a useful tool for anyone to consider if they are seeking to obtain documents for a matter outside of U.S. legal proceedings.
Although, there are obviously two sides to every matter, so people should be equally prepared for this to be used against them and to have appropriate counter arguments prepared. It is obviously not going to be used in every matter, but where it can be, it is always best to be prepared. Be ready to arm or defend.
Regardless of the use or non-use of this provision, we are seeing an increase in discovery-related work associated with international arbitration matters - be it in the form of helping formulate and respond to issues, managing relevant document sets - specifically looking for documents to be exhibited, or analysing complex and disparate data sets to build models used during expert evidence by the relevant accountants and/or economists.
Data and documents can be central to any legal proceeding regardless of whether there is a common law discovery or disclosure process, and it is essential that these are appropriately collected, managed and analysed to avoid subsequent issues due to incompleteness, inaccuracy or error!
With the potential to compel disclosure from parties outside the U.S. while they are within the jurisdiction of the U.S. court and to compel production of information from outside the U.S., Section 1782(a) becomes a potent tool in private international arbitration. When a party or other interested person to an arbitration can obtain access to the federal courts will also have a material effect on international arbitration. At least in theory, the flexibility of Section 1782(a) allows parties at the time of making a first arbitration demand, and before, to file in federal court to obtain evidence even before arbitrators are selected, terms of reference are finalized and management orders are put in place. There may be a race to the courthouse mindset that develops during arbitrable international disputes who might want evidence from the U.S. Success or failure in getting early access to a federal court to permit the gathering of evidence can materially affect whether the proceeding is progresses beyond the demand state, when, how it progresses, and under what theories. The availability of Section 1782(a) may compel arbitrators to exercise more control over the parties’ efforts to gather evidence in order to prevent Section 1782(a) from swallowing the arbitral discovery process. There may be cases with inconsistent rulings from the federal court and the arbitration panel with little precedent available on how to resolve the conflicting rulings. It is safe to predict that there will be a period, likely years, of uncertainty as a body of decisions develops in the federal courts. We may also see arbitration forums, such as the International Chamber of Commerce, the American Arbitration Association or the International Center for Dispute Resolution develop rules and protocols in response to developments in the federal courts.