In a case anticipated by international arbitration practitioners, the United States Supreme Court unanimously held that only governmental or intergovernmental adjudicative bodies, not private adjudicative bodies, constitute “foreign or international tribunals” under 28 U.S.C. § 1782 (“Section 1782” of “§ 1782”).
Section 1782 allows federal district courts to order testimony or the production of evidence “for use in a proceeding in a foreign or international tribunal.” Parties and some courts interpreted “foreign or international tribunal” to include international arbitration tribunals. This led to parties in private commercial arbitrations and investor-state arbitrations seeking discovery pursuant to § 1782 from U.S.-based entities related to the claims in international arbitrations. A circuit split developed, with the Fourth and Sixth Circuits allowing § 1782 discovery in private commercial international arbitrations and the Second, Fifth and Seventh Circuits not allowing discovery under the statute.
The Supreme Court has now resolved the split, in ZF Automotive US, Inc. et al v. AlisPartners, LLP et al, holding that § 1782 only reaches governmental or intergovernmental adjudicative bodies, not private adjudicative bodies. Two consolidated cases – one involving a private commercial arbitration and the other an investor-state ad hoc arbitration administered under the UNICTRAL rules – were before the Supreme Court. To reach its conclusion that § 1782 did not apply to either of these bodies, the Supreme Court examined the language of § 1782, its legislative history, purpose, and compared § 1782 with the Federal Arbitration Act (“FAA”), which governs private domestic arbitrations.
Looking to the language of § 1782, the Supreme Court found that while the word “tribunal” can include any type of adjudicative body, by attaching the modifiers “foreign or international,” “tribunal” is best understood as an adjudicative body that exercises governmental authority.” A “foreign tribunal” is one belonging to a foreign nation which possesses sovereign authority conferred by that nation. An “international tribunal” involves or is of two or more nations which have imbued the tribunal with official power to adjudicate disputes. Thus, only tribunals with government authority conferred up on them by one or two or more nations fall under the purview of § 1782.
This holding is bolstered by § 1782’s legislative history and purpose, the Supreme Court found. From 1855 to 1964, § 1782 and its antecedents applied only to foreign “courts.” The commission creating the statute that became § 1782 was charged with improving the process of judicial assistance between the U.S. and foreign countries, foreign courts, and quasi-judicial agencies. This mandate, the Supreme Court found, demonstrates an intent to apply § 1782 to bodies exercising government authority. Moreover, the animating purpose of § 1782 was comity, which would not be served by assisting private arbitral tribunals. In final support of its holding, the Supreme Court stated that the application § 1782 to international arbitral tribunals would give parties in international arbitrations greater discovery rights than parties in domestic arbitration governed by the FAA, which has narrower discovery provisions.
The Supreme Court then analyzed whether the private commercial tribunal and ad hoc investor-state tribunal at issue in the consolidated cases had government authority conferred upon them by one or two or more nations. The Court found they did not and, therefore, § 1782 could not be used to seek discovery.