By Jeffery Coren, originally published in Buffalo Law Journal on 6/7/17.

Getting Evidence in U.S. for Foreign Proceedings

By JEFFREY COREN – Guest Columnist
Jun 7, 2017, 6:00am

In today’s global and digital economy, documents and witnesses relevant to a proceeding may be found in multiple countries. As a result, parties involved in foreign proceedings should develop a global litigation strategy.

A party involved in litigation or other legal proceeding outside the U.S., or considering bringing a foreign proceeding, can use a powerful federal tool to obtain evidence in aid of that proceeding from parties located in the U.S. — 28 U.S.C. § 1782 (Section 1782). This statute permits expansive discovery, which may not otherwise be available to parties in the foreign jurisdiction, and can be used to obtain testimony and documents from third parties in the U.S.

Ex parte application

Section 1782 has expansive reach. Under Section 1782, “any interested person” may apply, ex parte, to the federal district court “in which a person resides or is found” for an order to produce documents or provide testimony “for use in a proceeding in a foreign or international tribunal.” The district court has discretion whether to grant the application and will look to four factors:

  • Whether the person from whom discovery is sought is participating in the foreign proceeding;
  • The nature of the foreign tribunal and its receptiveness to U.S. judicial assistance;
  • Whether the request conceals an attempt to circumvent foreign proof-gathering restrictions;
  • Whether the request is unduly intrusive or burdensome.

See Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 264-65 (2004).

If the district court grants the Section 1782 application, the petitioner may serve a subpoena pursuant to Rule 45 of the Federal Rules of Civil Procedure.

Not limited to parties in litigation

Section 1782 is applicable to proceedings in any foreign “tribunal,” including civil, commercial, criminal and administrative courts. It also applies to investigating magistrates, administrative and arbitral tribunals, and quasi-judicial agencies, although there is some disagreement amongst the federal courts as to whether it applies to private international arbitrations. Moreover, Section 1782 is available not only to a party in a foreign proceeding but any person with significant participation rights in the proceeding who possesses a reasonable interest in obtaining judicial assistance.

Reasonably contemplated proceedings

Discovery under Section 1782 is not limited to ongoing proceedings, or even to proceedings that are pending or imminent. The proceeding only needs to be “within reasonable contemplation” at the time of the application.

In 2015, the Second Circuit addressed this point and held that as long as the proceeding is within reasonable contemplation, the discovery sought does not need to be “necessary” to succeed in the proceeding or even “sought for the purpose of commencing a foreign proceeding.” Mees v. Buiter, 793 F.3d 291, 295 (2d Cir. 2015).

However, in another decision that same year, the Second Circuit warned that the contemplated proceeding “cannot be merely speculative” and an applicant must show some “concrete basis” that “the contemplated proceeding is more than just a twinkle in counsel’s eye.” Certain Funds, Accounts &/or Inv. Vehicles v. KPMG, L.L.P., 798 F.3d 113, 124 (2d Cir. 2015). Earlier this year, Judge Alvin Hellerstein in the Southern District of New York applied these principles and granted a Section 1782 petition to obtain evidence for a contemplated Dutch proceeding. See In re Kiobel, No. 16 Civ. 7992, 2017 WL 354183 (S.D.N.Y. Jan. 24, 2017).

No exhaustion/discoverability requirements

In order to grant an application under Section 1782, the district court does not need to determine whether the evidence would be discoverable in the foreign proceeding or will ultimately be admissible in that foreign tribunal. There is also no requirement that the interested party first attempt to obtain discovery in the foreign proceeding.

Expansive U.S. discovery

As opposed to foreign or international tribunals, which often provide for narrow discovery and limit the procedures for gathering evidence, the discovery permitted under Section 1782 is relatively broad and operates under the Federal Rules of Civil Procedure. As a result, an applicant may be able to obtain documents and testimony from parties in the U.S. that it could not obtain if those parties were located elsewhere.

Global litigation strategy

As part of their global litigation strategy, parties involved in foreign litigation or other proceedings should consider seeking testimony and documents from any relevant third parties in the U.S. Given the scope of available discovery permitted under Section 1782, these third parties may include individual witnesses, financial institutions and corporate subsidiaries or affiliates located in the U.S.