ニュース May 14, 2021

Amicus Brief Addresses Whether 28 USC § 1782 Authorizes Discovery in Non-US Arbitrations

On May 12, 2021, Shearman & Sterling filed an amicus curiae brief with the Supreme Court of the United States on behalf of Federal Arbitration, Inc. in support of Petitioner, Servotronics, Inc. in the case of Servotronics, Inc. v. Rolls-Royce PLC, et al. The case involves the long-standing issue of whether 28 U.S.C. § 1782, the U.S. statute authorizing discovery for use in proceedings involving “foreign or international tribunals,” encompasses non-U.S. commercial arbitral tribunals.

The case arises out of a commercial arbitration brought by Rolls-Royce PLC against Servotronics in the United Kingdom. Following the malfunction of an engine manufactured and supplied by Rolls-Royce to The Boeing Company, which resulted in significant damage to a Boeing aircraft, Rolls-Royce settled Boeing’s claim for damages. It then sought indemnification from Servotronics, which had supplied the valve for the Rolls Royce engine. After Servotronics refused to pay, the arbitration ensued.

To obtain evidence for use in that arbitration, Servotronics filed applications in multiple federal district courts pursuant to 28 U.S.C. § 1782. In one of those cases, Servotronics sought evidence before the U.S. District Court for the District of South Carolina. The District Court denied Servotronics’ application. The U.S. Court of Appeals for the Fourth Circuit reversed, finding that “the UK arbitral panel convened to address the dispute between Servotronics and Rolls-Royce is a ‘foreign or international tribunal’ under § 1782(a).” Separately, in the case at hand, the U.S. District Court for the Northern District of Illinois quashed the subpoena it had initially granted in favor of Servotronics to obtain documents for use in the London arbitration. The U.S. Court of Appeals for the Seventh Circuit affirmed that decision, finding, contrary to the Fourth Circuit Court, that “§ 1782(a) does not authorize the district courts to compel discovery for use in private foreign arbitrations.” Servotronics thereafter sought a writ of certiorari before the U.S. Supreme Court, which was granted to resolve the Circuit split.

Amicus argues threefold: First, that the plain text of the statute permits federal district courts to grant discovery for use in non-U.S. commercial arbitrations. The legislative history, to which the Court need not resort under its well-established rules of statutory construction, only further bolsters that position. Second, the distinction some courts have drawn between so-called “private” and “state-sponsored” arbitral tribunals in order to exclude the former from Section 1782’s reach is illusory, as all forms of arbitration are in fact “state sponsored.” Third, the Court’s prior, well-reasoned decision in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004) is determinative irrespective of the statute’s plain language, as the Court held that there was “no warrant to exclude” a “tribunal” from Section 1782(a)’s ambit to the extent it “acts as a first-instance decisionmaker.” As first-instance decisionmakers performing, like courts, an important adjudicatory function, commercial arbitral tribunals clearly fall within the statute’s scope.

This issue has generated tremendous debate over the past few decades and remains a point of key interest in the international arbitration community. The Supreme Court’s decision will thus finally resolve a long-debated question and no doubt have a tremendous impact on how parties deal with these types of discovery applications in the future.

Read the amicus curiae brief in "Servotronics, Inc. v. Rolls-Royce PLC, et al."

The Team

業務分野

産業