Eleventh Circuit Takes the Middle of the Road in Evaluating a Foreign Tribunal’s “Receptivity” to Judicial Assistance from U.S. Courts

In Department of Caldas v. Diageo PLC, 2019 WL 2333910 (11th Cir. June 3, 2019), the Eleventh Circuit held that a district court evaluating a foreign court’s receptivity to judicial assistance from a U.S. Court in the context of an application for discovery under 28 U.S.C. § 1782 need not apply a rigid burden of proof.  Section 1782 permits, under certain circumstances, discovery in the United States for use in aid of a foreign proceeding.  In 2016, four Colombian Departments—the Department of Caldas, the Department of Cundinamarca, the Department of Valle del Cauca, and the Department of Antioquia—filed an application under § 1782 in the Southern District of Florida.  The Departments sought to depose five former employees of three liquor companies—Diageo PLC, Seagrams Sales Co. Ltd., and Pernod-Ricard S.A.—for use in an anticipated civil action in Colombia.

Resolution of an application under § 1782 requires consideration of the statutory requirements of § 1782 and then, if the statutory requirements are met, analysis of the discretionary factors identified by the Supreme Court in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004).  The statute requires that a request be made “by a foreign or international tribunal or upon the application of any interested person,” seeking evidence from a person residing or found in the relevant federal district, “for use in a proceeding in a foreign or international tribunal[.]”  After an initial dispute between the Departments and the liquor companies about whether the Departments really anticipated Colombian litigation, such that the Departments were qualified “interested persons,” the district court found that two of the four Departments were sufficiently “interested” and had met the statutory requirements for discovery under § 1782.  The district court also determined that those two Departments satisfied the discretionary factors, including the factor requiring consideration of “the receptivity of the foreign . . . court . . . to U.S. federal-court judicial assistance[.]”  As a result, the district court granted the application for discovery as to those two Departments.  The liquor companies, who had intervened in the case in the district court, appealed.  The companies argued that the district court failed to apply the proper burden of proof in evaluating the “receptivity” factor.

The Eleventh Circuit, in an opinion written by Judge Jordan and joined by Judge Grant and Judge Bobby Baldock visiting from the Tenth Circuit, affirmed the order of the district court.  The court began by confirming that it would undertake plenary review of the question, because determination of the proper burden of proof is a pure question of law.  The court noted the absence of authority for the liquor companies’ argument that the § 1782 applicant should bear the burden of proof on the issue of “receptivity,” and cited several cases, including cases from the Second and Third Courts of Appeals, placing the burden on the party resisting discovery.  Ultimately, however, the court adopted the “middle-of-the-road approach” adopted by the First Circuit in In re Schlich, 893 F.3d 40, 50 (1st Cir. 2018):  “[W]e . . . similarly hold that district courts need not apply a rigid burden-shifting framework to properly weigh the discretionary factor of receptivity in a § 1782 case.”  Instead, a court can consider the evidence presented by both sides in exercising its discretion to permit or deny discovery based on the foreign court’s receptivity (or lack thereof) to judicial assistance from a U.S. Court.

Posted by Valerie Sanders.

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