At the end of 2019, the Second Circuit finally weighed in on an issue that has divided federal courts considering applications for discovery pursuant to 28 U.S.C. § 1782, through which a litigant can obtain an order from a federal court for discovery to be used in a foreign proceeding. (You can read more about Section 1782 here and here). Federal courts have split over whether Section 1782 allows a party to obtain documents controlled by an entity in the United States but that are held overseas—for example, records held in the London office of a corporation headquartered in New York.1 In a pair of recent decisions, the Court of Appeals for the Second Circuit joined the Eleventh Circuit in holding that Section 1782 does permit discovery of documents held outside the United States and that are within the control of a US individual or entity.
Continue Reading Second Circuit Weighs in on the Extraterritorial Application of 28 U.S.C. § 1782

In a much-anticipated opinion, Judge George B. Daniels of the United States District Court for the Southern District of New York recently affirmed the decision of a magistrate judge regarding the scope of discovery in aid of a foreign litigation pursuant to 28 U.S.C. § 1782.  (You can read more about Section 1782 and the magistrate judge’s underlying decision in our prior blog post, here).  Briefly, Magistrate Judge Gabriel W. Gorenstein grappled with an issue that has divided federal courts: whether Section 1782 can be used to compel the production of documents maintained outside the United States.[1]  Magistrate Judge Gorenstein held that the fact that documents were maintained overseas did not bar the discovery sought so long as the documents were within the control of a discovery target located in the U.S.—in this case, a New York-based law firm with a branch office in Russia. 
Continue Reading New Decision Regarding Discovery in Aid of Foreign Litigation

Picture your client telling you they were considering starting a litigation, but that they did not yet have all the facts needed for you to prepare a pleading.  Now add the wrinkle that the action would need to be forumed in a foreign country, one with discovery rules narrower than those in the United States, and then the kicker, that some of the relevant documents are held by third parties outside of the planned litigation forum.  Although your initial reaction might be that your client is out of luck, 28 U.S.C. § 1782, which allows foreign litigants (or soon-to-be litigants) to obtain discovery in the United States, under U.S. discovery rules, for use in a pending or contemplated foreign proceeding, might offer some help.

Under Section 1782, a federal courts can grant an application for discovery in aid of a foreign proceeding (or planned proceeding) if the applicant: (a) has an interest in the foreign proceeding; (b) the discovery will be used in that foreign proceeding; and (c) the target of the discovery request resides in the judicial district where the request is made.[1]  However, federal courts can deny the discovery request, even when those statutory factors are met, based on purely discretionary factors such as whether the target is a party to the litigation, whether the applicant is attempting to circumvent either U.S. or foreign proof gathering restrictions, and whether the requests are found “unduly burdensome.”[2]  Although one might think that overworked federal courts would often use those discretionary factors to deny discovery requests in support of litigation pending in a far-flung forum, federal courts routinely grant Section 1782 applications.  Two recent decisions—one granting and one denying a Section 1782 application—show just how broad discovery under Section 1782 can be.
Continue Reading The Broad Scope of 28 U.S.C. Section 1782