Discovery Under § 1782 in International Commercial Arbitration: Recent Developments From A Comparative Perspective

• Author: Tamar Meshel
• Pages: 361-395

Discovery Under § 1782 in International

Commercial Arbitration: Recent Developments

From A Comparative Perspective

T

AMAR

M

ESHEL

*

Abstract

Title 28 U.S.C. § 1782 empowers American federal courts to order

persons in the United States to give testimony or to produce documents “for

use in a proceeding in a foreign or international tribunal.” But disagreement

persists, both in the courts and among commentators, as to whether the

phrase “international tribunal” in § 1782 includes “private” international

commercial arbitral tribunals. The circuit split that has emerged in this

regard and the lack of a uniform approach across the United States has

created uncertainty and unpredictability in international commercial

arbitration practice, which are not conducive to orderly international

commercial transactions and dispute resolution. In this article, I approach

the debate from a comparative perspective that has thus far been

underutilized in the literature. Given that one of the main purposes of

§ 1782 is to promote comity and cooperation among nations, I undertake a

detailed examination of recent jurisprudential and legislative developments

in two jurisdictions––the United Kingdom and New Zealand– –with respect

to judicial assistance in the taking of evidence from persons located in their

territory for use in private international commercial arbitration.

Notwithstanding differences in their general approach to discovery, these,

and other, jurisdictions are increasingly allowing for such judicial assistance.

Therefore, I argue that American courts should similarly interpret § 1782 to

allow, in principle, discovery in relation to private international commercial

arbitrations. Courts should then exercise their discretion in enforcing the

provision in accordance with clear and uniform criteria that will promote the

goals of both § 1782 and international commercial arbitration and prevent

abuse and unnecessary judicial intervention.

I. Introduction

For parties to commercial disputes, an inseparable part of litigation in

American courts is the ability to conduct extensive discovery

1

of documents

* Assistant Professor, University of Alberta Faculty of Law.

1. For present purposes, the term “discovery” is used to refer to “the process whereby one

party requests that a witness produce or turn over relevant documents or information, or that a

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and testimonial evidence both from a counterparty and from third parties to

the litigation.

2

In contrast, when parties choose to arbitrate such disputes,

their right and ability to conduct broad discovery is far more constrained.

Section 7 of the Federal Arbitration Act (FAA) governs the service and

enforcement of arbitral subpoenas for documents and witness testimony.

3

Under this section, only arbitrators are empowered to order the production

of evidence, both testimonial and documentary evidence must be submitted

at a hearing before the arbitrators, only the federal district court where the

arbitration is conducted may enforce an arbitral subpoena not voluntarily

complied with, and the ability to obtain pre-hearing discovery from third

parties is limited.

4

Matters are more complicated, however, where an

witness sit for a deposition, during which her testimony is collected under oath, but outside of

court.” Further, in federal courts, discovery is conducted pursuant to the Federal Rules of Civil

Procedure. Hagit Muriel Elul & Rebeca E. Mosquera, Chapter 17: 28 U.S.C. Section 1782: U.S.

Discovery in Aid of International Arbitration Proceedings, in I

NTERNATIONAL

A

RBITRATION IN THE

U

NITED

S

TATES

394 (Laurence Shore et al, eds., 2017). Discovery is a notoriously ambiguous

concept from an international perspective. A

LAN

R

EDFEM

& M

ARTIN

H

UNTER

, L

AW AND

P

RACTICE OF

I

NTERNATIONAL

C

OMMERCIAL

A

RBITRATION

22-23 (4th ed. 2004) (“To a civil

lawyer, it means nothing; to a U.S. lawyer it encompasses production of documents and

depositions of potential witness and experts as well as inspection of the subject-matter of the

dispute; to an English lawyer it refers only to the production of documents.”).

2. For present purposes, the term “third party” is used to refer to a person who is not a party

to the arbitration and over whom the arbitral tribunal does not have jurisdiction. See Elul &

Mosquera, supra note 1, at 411 n.23.

3. 9 U.S.C. § 7 (1951) provides that:

The arbitrators selected either as prescribed in this title or otherwise, or a majority

of them, may summon in writing any person to attend before them or any of them

as a witness and in a proper case to bring with him or them any book, record,

document, or paper which may be deemed material as evidence in the case. The

fees for such attendance shall be the same as the fees of witnesses before masters of

the United States courts. Said summons shall issue in the name of the arbitrator or

arbitrators, or a majority of them, and shall be signed by the arbitrators, or a

majority of them, and shall be directed to the said person and shall be served in the

same manner as subpoenas to appear and testify before the court; if any person or

persons so summoned to testify shall refuse or neglect to obey said summons, upon

petition the United States district court for the district in which such arbitrators, or

a majority of them, are sitting may compel the attendance of such person or persons

before said arbitrator or arbitrators, or punish said person or persons for contempt

in the same manner provided by law for securing the attendance of witnesses or

their punishment for neglect or refusal to attend in the courts of the United States.

4. The availability of pre-hearing discovery from third parties is a controversial question on

which the circuit courts are split. The Courts of Appeals for the Second Circuit, see Life

Receivables Tr. v. Syndicate 102 at Lloyd’s of London, 549 F.3d 210, 216-217 (2d Cir. 2008);

Third Circuit, see Hay Grp., Inc. v. E.B.S. Acquisition Corp., 360 F.3d 404, 406 (3d Cir. 2004);

Ninth Circuit, see CVS Health Corp. v. Vividus, LLC, 878 F.3d 703, 705 (9th Cir. 2017); and

Eleventh Circuit, see Managed Care Advisory Grp., LLC, v. CIGNA Healthcare, Inc., 939 F.3d

1145, 1151 (11th Cir. 2019) have categorically refused to enforce arbitral subpoenas compelling

pre-hearing discovery from third parties under § 7 of the FAA. In contrast, the Court of

Appeals for the Eight Circuit has enforced such arbitral subpoenas, see In re Arbitration

Between Sec. Life Ins. Co. Am., 228 F.3d 865, 872 (8th Cir. 2000), and the Court of Appeals for

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2021] DISCOVERY UNDER § 1782 363

international commercial arbitration is at issue––that is, an arbitration that

involves a non-American party or a cross-border dispute. Where such an

arbitration is conducted in the United States, § 7 of the FAA applies to it.

5

But what of an international commercial arbitration conducted abroad,

6

to

which § 7 does not apply, involving third party witnesses or evidence located

in the U.S.?

7

Since 1964, American federal courts have been empowered under 28

U.S.C. § 1782 to order persons located in the United States to give

testimony or to produce documents “for use in a proceeding in a foreign or

international tribunal” pursuant to a request made “by a foreign or

international tribunal or upon the application of any interested person.”

8

Some federal courts have interpreted the phrase “foreign or international

tribunal” in § 1782 liberally to include private international commercial

arbitral tribunals.

9

But other federal courts, as well as many commentators,

have taken the position that § 1782 does not apply to private international

the Fourth Circuit has expressed a willingness to do so where the petitioner can show a “special

need or hardship,” see COMSAT Corp. v. Nat’l Sci. Found., 190 F.3d 269, 278 (4th Cir. 1999).

5. 9 U.S.C. § 7 (permitting the enforcement of an arbitral subpoena only by the “district

court for the district in which such arbitrators, or a majority of them, are sitting.”).

6. Otherwise known as a “foreign” arbitration, and the distinction between “foreign” and

“international” may be articulated as follows: “[t]he term ‘foreign’ signifie[s] a location outside

the United States. The term ‘international’ denote[s] a situation involving multiple nations or

nationalities.” Brief Supporting Petitioner Servotronics, Inc at 3, Servotronics, Inc. v. Rolls-Royce

PLC, No. 20-794 (May 13, 2021). For present purposes, an “international commercial

arbitration” is an arbitration conducted outside the United States. Id.

7. International arbitrators are generally considered as having extensive powers to order the

production of evidence by the parties to the arbitration, without having to resort to domestic

courts to enforce such orders. However, there may be situations where the broader and

coercive powers of national courts are required, such as for the enforcement of arbitral orders

requiring the production of evidence by third parties over whom the arbitral tribunal has no

jurisdiction. See Robert Bradshaw, How to Obtain Evidence from Third Parties: A Comparative

View, 36 J. I

NT

’

L

A

RB

. 629, 639 (2019) (“Tribunals can only enforce their orders through the

local courts and are therefore ultimately dependent on the assistance of the court system, above

all where non-parties are concerned.”).

8. 28 U.S.C. § 1782 (a) (2018). For a general discussion of § 1782, see, e.g., Gabriela Barriuso

Clark, Interpretative Challenges of 28 U.S.C. § 1782 in the Aftermath of Intel Corp. v. Advanced

Micro Devices, Inc., 53 V

AND

. J. T

RANSNAT

’

L

L. 1377, 1377 (2020); Benjamin M. Glass, The Best

of Both Worlds: The Fifth Circuit’s Interpretation of “Within Reasonable Contemplation” Provides

Important Discovery Opportunities for International Maritime Litigants, 40 T

UL

. M

AR

. L. J. 519,

519 (2016); Hans Smit, American Assistance to Litigation in Foreign and International Tribunals:

Section 1782 of Title 28 of the U.S.C. Revisited, 25 S

YRACUSE

J. I

NT

’

L

L. & C

OM

. 1, 1 (1998);

Walter B. Stahr, Discovery under 28 U.S.C. § 1782 for Foreign and International Proceedings, 30

V

A

. J. I

NT

’

L

L. 597, 597 (1990); Nicolo Trocker, U.S. Style Discovery for Non-U.S. Proceedings:

Judicial Assistance or Judicial Interference, 1 IJPL 299, 299 (2011); Jane Wessel & Peter J. Eyre,

US Discovery in Aid of Foreign or International Proceedings: The Rise of 28 USC, s 1782, 75 I

NT

’

L

J.

A

RB

. 158, 158 (2009); Mousa Zalta, Recent Interpretations of 28 U.S.C. § 1782(a) by the Supreme

Court in Intel Corp. v. Advanced Micro Devices, Inc.: The Effects on Federal District Courts, Domestic

litigants, and Foreign Tribunals and Litigants, 17 P

ACE

I

NT

’

L

L. R

EV

. 413, 413 (2005).

9. Paul Levine et al., Second Circuit Denies Extending § 1782 Discovery in Private International

Commercial Arbitrations, B

AKER

H

OSTETLER

(July 10, 2020), https://www.bakerlaw.com/alerts/

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