International Discovery Tool Kit Aims to Facilitate Discovery in Both Domestic and Foreign Litigation

• Publication year: 2023

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Benjamin Daniels and Jenna Scoville ^*

Abstract: Business knows no borders. Every year companies increase their global reach and open new offices both domestically and abroad. The COVID-19 pandemic accelerated this process—remote employees spread documents and witnesses from Chicago to Shanghai to Sumatra. This has made litiga-tion—especially discovery—more complex. Navigating this environment requires a tool kit of resources to secure discovery in support of both domestic and foreign litigation. This article discusses those tools and several traps for the unwary practitioner facing cross-border discovery to anticipate to effectively use those tools to their benefit.

Section 1782: Compelling U.S. Discovery in Support of a Foreign Proceeding

Foreign courts famously disdain U.S.-style discovery. In most countries, such as Germany and France, the parties simply submit the evidence already in hand, without the full benefit of depositions, interrogatories, or document requests. In others, such as Switzerland, courts will arrest foreign lawyers who try to take a deposition. Seemingly, if you litigate in a foreign court, discovery, as it is known in the United States, is not going to happen.

But parties often forget a powerful tool to get around those restrictions and obtain U.S.-style discovery from companies with a connection to the United States. Under 28 U.S.C. § 1782, an "interested person" can get discovery from a person "found in"

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the United States "for use" in a "proceeding in a foreign or international tribunal."

The statute is far-reaching. To begin with, an "interested person" is much broader than most expect. This is not just a party to the proceeding, but can include persons who are third parties, interested parties, or even just investigating a claim. And the "proceeding in a foreign or international tribunal" does not just mean a court case. Discovery can be for contemplated litigation, criminal proceedings, and proceedings before administrative bodies.

But the U.S. Supreme Court recently held that § 1782 does not extend to private international arbitrations. ¹ In reaching its holding, the U.S. Supreme Court reasoned a "foreign tribunal" refers to a tribunal belonging to a foreign nation, which must possess sovereign authority conferred by that nation. ² As for the word "international," the court relied on the dictionary definition for the term—"involving of two or more nations"—to determine that an "international tribunal" is one involving two or more nations that have imbued the tribunal with official power to adjudicate disputes. ³ Put differently, a "foreign tribunal" refers to a governmental body of one foreign nation whereas an "international tribunal" means any tribunal that two or more nations have imbued with governmental authority.

At a time when litigants have increasingly relied on U.S. federal courts to obtain otherwise unobtainable evidence from entities located within the United States, the U.S. Supreme Court has decisively closed the door to U.S.-style discovery in private arbitrations abroad. That means U.S. companies will no longer face the time, exposure, and expense of U.S.-style discovery that § 1782 had injected into those proceedings. The Supreme Court's decision also ensures participants located in foreign countries cannot obtain an advantage over participants located within the United States.

Additionally, in certain jurisdictions, a § 1782 petition can be filed anywhere the company has a substantial and systematic presence. ⁴ In those jurisdictions, a company has a substantial and systematic presence "where the discovery material sought proxi-mately resulted from the [company's] forum contacts" or where "the [company] having purposefully availed itself of the forum [is] the primary or proximate reason that the evidence sought is available at all." ⁵

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But a recent decision from the U.S. Court of Appeals for the Fourth Circuit has required proof that the company has a physical presence in the forum. ⁶ This holding has created...