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Section 1782 – Recent Developments

Written by Eric Hager | 10.6.21

A federal statute, 28 U.S.C. § 1782, provides a way for foreign litigants to take discovery in the United States and then use it in a legal proceeding abroad.

Section 1782 can be an important evidence-gathering tool for parties involved in international disputes, and formulating a persuasive application for discovery under the statute (or effectively responding to one) is essential. That is particularly true now, as applications for discovery under the statute have become relatively common. A sampling of decisions from September 2021 reflects that reality:

• In re Fundo de Liquidacao Financeira – Fundo de Investimento em Direitos Creditorios Nao Padronizado, 8:21-MC-110-VMC-AAS, 2021 WL 4392258, at *2 (M.D. Fla. 23, 2021) (granting Section 1782 application by Brazilian investment fund for discovery from Marriott Ownership Resorts, Inc.)
• In Re Ex Parte Application of JSC Commercial Bank PrivatBank, 21-MC-80216-VKD, 2021 WL 4355334, at *5 (N.D. Cal. Sept. 24, 2021) (granting Section 1782 application by bank for discovery from Google regarding an individual’s email accounts for use in a civil action in the United Kingdom)
• Tokyo Univ. of Soc. Welfare v. Twitter, Inc., 21-MC-80102-DMR, 2021 WL 4124216, at *6 (N.D. Cal. Sept. 9, 2021) (quashing subpoena arising out of Section 1782 application from Japanese university that sought to unmask anonymous Twitter user)

As would be expected, recent district court decisions involving Section 1782 illustrate many of the common themes of applications under the statute, such as the frequent reliance on declarations from foreign lawyers on foreign law, In re Al-Attabi, 21-MC-207 (VSB), 2021 WL 4027021, at *3 (S.D.N.Y. Sept. 3, 2021) (in Section 1782 application involving several banks, crediting “a declaration from a Lebanese litigator” on “the Lebanese Code of Civil Procedure”), and the judiciary’s encouragement of efficient discovery techniques, Republic of the Gambia v. Facebook, Inc., CV 20-MC-36-JEB-ZMF, 2021 WL 4304851, at *14 (D.D.C. Sept. 22, 2021) (suggesting use of technology assisted review in Section 1782 proceeding allowing discovery from Facebook related to Gambia’s International Court of Justice litigation against Myanmar).

At the appellate level, the Eleventh Circuit’s recent decision in Rothe v. Aballi, 20-12543, 2021 WL 4429814 (11th Cir. Sept. 27, 2021) offers practitioners useful insights into appeals of Section 1782 applications. In Rothe, an individual sought discovery concerning a family trust. Id. at *1. The magistrate judge originally granted the Section 1782 application, but subsequently vacated that order, reasoning (incorrectly) that “the whole purpose of 1782 [is] that the documents cannot be obtained in the forum state.” Id. The district court sustained objections to the magistrate judge’s ruling and ordered the discovery to go forward. Id. The target of the discovery appealed, but was denied a stay pending the appeal, so it produced the requested documents. Id.

On appeal, the Eleventh Circuit made three rulings of particular interest.

First, the court held that the appeal was not moot because “the return of private documents . . . would provide some meaningful relief.” Id. at *2. That means a party may be compelled to produce documents under Section 1782, see those documents be used in a foreign litigation, and then win an appeal that results in the physical return of the documents. Yet it would not be surprising to find many litigants unwilling to bring an appeal under such circumstances.

Second, the court confirmed “that § 1782 motions are non-dispositive matters within the meaning of 28 U.S.C. § 636(b)(1)(A),” and so rulings by magistrate judges on such motions should be reviewed by the district court to determine if clearly erroneous or contrary to law. Id. (emphasis added).

Third, the court squarely held that Section 1782 has no “exhaustion requirement,” meaning that applicants do not have to attempt to obtain the discovery in the foreign proceeding before seeking it through a Section 1782 application. Id. This was probably the court’s most important holding for other Section 1782 litigants, as exhaustion-like arguments are common.

Also relevant to the Section 1782 appellate landscape is the “Circuit split regarding whether parties to private arbitrations, as opposed to state-sponsored arbitration, are authorized to utilize section 1782 to obtain discovery for use in those proceedings.” Food Delivery Holding 12

S.a.r.l. v. DeWitty & Associates CHTD, 1:21-MC-0005 (GMH), 2021 WL 1854343, at *4 (D.D.C. May 10, 2021). The U.S. Supreme Court was poised to resolve that split in Servotronics, Inc. v. Rolls-Royce PLC (No. 20-794), an appeal from a Seventh Circuit decision, but the parties surprisingly filed a joint stipulation to dismiss on September 24, 2021. Thus, for now, the Circuit split remains.

Conrad & Scherer has represented clients both seeking and opposing requests for discovery under Section 1782. For further information, please contact Eric Hager at ehager@conradscherer.com or 954-622-0461.