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.
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On January 4, 2019, the California Court of Appeal, First Appellate District issued an opinion reminding us that under California law, tax returns are privileged and improper disclosure of them can even potentially rise to tortious invasion of privacy claims in overturning a demurrer as to that claim. Strawn v. Morris, Polich & Purdy, LLP, No. A150562, 2019 Cal. App. LEXIS 9 (Ct. App. Jan. 4, 2019).

Federal and state tax returns have been held to be privileged from disclosure under California law. Id at *13; Wilson v. Superior Court, 63 Cal. App. 3rd 825, 828 (1976); Webb v. Standard Oil Co., 49 Cal. 2nd 509, 512-513 (1957).  As highlighted by the opinion, the purpose of the privilege “is to encourage voluntary filing of tax returns and truthful reporting of income, and thus to facilitate tax collection.” Strawn at *13; Weingarten v. Superior Court, 102 Cal. App. 4th 268, 274 (2002); Webb at 513. 
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Seyfarth Synopsis: Please join us at our Chicago Willis Tower office on Thursday, December 6th, for breakfast along with a Seyfarth Legal Forum and Continuing Legal Education (CLE): 2018 Highlights and a Look Ahead to 2019.

About the Program

Providing our clients with a multidisciplinary overview of Legal Hot Button issues and Best Practice. 

Seyfarth Shaw Partner Jordan Vick is on the panel for the “Playing by the Rules: Rule Changes Essential to Your Practice” session on Friday, November 16, at Georgetown Law’s 15th annual Advanced eDiscovery Institute in Washington, D.C.

Session topics include:

  • The 2015 Amendments to the FRCP and their actual impacts on practitioners, including unintended consequence

By now, most litigators should know that they have an affirmative duty to advise their clients about the duty to preserve potentially relevant documents.  Despite this, the United States District Court for the Southern District of New York recently denied an attorney defendant’s motion for summary judgment in part because the record was not clear as to whether the attorney defendant fulfilled its obligations with respect to the duty to preserve.

Industrial Quick Search, Inc., Michael Meiresonne, and Meiresonne & Associates (collectively “Plaintiffs”) sued their law firm Miller, Rosado & Alogis, LLP (“Defendants”) for malpractice.  Neil Miller and Chris Rosado, named partners of the firm, were also individually named as Defendants.  Defendants represented Plaintiffs in an underlying copyright infringement lawsuit in which default judgement was entered against Plaintiffs for misappropriating confidential information, plagiarizing copyrighted material, and for deliberately destroying potentially relevant documents.
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Seyfarth Shaw Offers Data Privacy & Protection in the EU-U.S. Desktop Guide and On-Demand Webinar Series

On May 25, 2018, the EU General Data Protection Regulation (“GDPR”) will impose significant new obligations on all U.S. companies that handle personal data of any EU individual. U.S. companies can be fined up to €20 million or 4%

A trial court opinion involving allegations of spoliation of text messages on a mobile phone in the Southern District of New York has gotten attention because of the application of legal preservation standards.  Ronnie Van Zant, Inc. v. Pyle 2017 BL 3018, S.D.N.Y. 17 Civ. 3360 (RWS), 8/23/17) is an interesting read, not just because it involves odd characters, intrigue and drama surrounding one of the greatest Southern Rock bands of all time.  It also includes some instructive information about the application of the “practical ability” test for preservation, and the uphill battle for witnesses who lose credibility in testimony about what they did and did not do in a preservation effort.

Not long after the tragic plane crash that resulted in the deaths of Lynyrd Skynyrd lead singer Ronnie Van Zandt and his co-founding band member Steven Gaines,  Artimus Pyle, the former drummer, entered an agreement with the surviving heirs and other members of the band.  The agreement involved promises to never perform as “Lynyrd Skynyrd,” or to generally profit from the name of the band or the tragic deaths of Van Zant or Gaines without approval of the original parties to the agreement.  Their dramatically named “blood oath” agreement was more concretely memorialized in a Consent Order in 1988, following other litigation, which Pyle signed.

Over 20 years after the 1988 Consent Order, the drama that spawned the litigation began in a story that sounds like it came from a Netflix mini-series.  A film director named Jared Cohn, who worked under contract for an independent record label-turned movie producer, Cleopatra Records, Inc. (“Cleopatra”) reached out to Pyle about making a movie centered around the band and Pyle’s life in it.  Cohn was hired by the founder and co-owner of Cleopatra Records, Brian Perera, who is another interesting character in his own right. Pyle met and consulted with Perera on multiple occasions about ideas for a film generally depicting his life and the plane crash, which Pyle survived.  In their first conversations, Pyle did not mention the 1988 Consent Order, but the Order eventually was delivered to Cleopatra.  The copy of the Order was also eventually followed by a “cease and desist” letter and other correspondence from the Plaintiffs’ counsel.  All the while, Cleopatra’s movie production work continued.
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Seyfarth eDiscovery Partner Richard Lutkus, along with William Lederer from Relativity and Patrick Zeller of Gilead Sciences, Inc., will host a panel discussion titled “Brave New Words: Cloud Data Collection, Processing, and Hosting” at this year’s RelativityFest on October 24, 2017.

This session will provide attendees with information about new data collection methods with tools

Seyfarth eDiscovery attorneys Jason Priebe and Natalya Northrip will present “A Practical Roadmap for EU Data Protection and Cross-Border Discovery” at this year’s RelativityFest on October 24, 2017.

This presentation will provide attendees with practical tips for leveraging the new Sedona International Principles to help in your compliance with stringent GDPR requirements, and in seeking