Gianoli Aldunate, Application of

• Decision Date: 20 August 1993
• Docket Number: D,No. 1543,1543
• Citation: 3 F.3d 54
• Parties: In re APPLICATION OF Silvia GIANOLI ALDUNATE, and Jose Miguel Barriga Gianoli. Maria Luisa De Castro FODEN, and Edward Foden, Appellants, v. Silvia GIANOLI ALDUNATE, and Jose Miguel Barriga Gianoli, Appellees. ocket 93-7215.
• Court: U.S. Court of Appeals — Second Circuit

Page 54

3 F.3d 54

62 USLW 2118

In re APPLICATION OF Silvia GIANOLI ALDUNATE, and Jose Miguel Barriga Gianoli Maria Luisa De Castro FODEN, and Edward Foden, Appellants, v. Silvia GIANOLI ALDUNATE, and Jose Miguel Barriga Gianoli, Appellees.

No. 1543, Docket 93-7215.

United States Court of Appeals Second Circuit.

Argued May 6, 1993.

Decided Aug. 20, 1993.

Philip L. Graham, Jr., New York City (Henry Christensen III, Basil P. Zirinis III, Anthony C. Walsh, Sullivan & Cromwell, New York City, Steven R. Humphrey, Robinson & Cole, Hartford, CT, of counsel), for appellants.

Kenneth A. Caruso, New York City (Andrew W. Regan, Shearman & Sterling, New York City, James F. Stapleton, Joy Beane, Day, Berry & Howard, Stamford, CT, of counsel), for appellees.

Before: MESKILL, PIERCE and WALKER, Circuit Judges.

MESKILL, Circuit Judge:

This is an expedited appeal from a final order of the United States District Court for the District of Connecticut, Cabranes, C.J., denying the motion of appellants Maria Luisa de Castro Foden and Edward Foden (the Fodens) to vacate the district court's order granting discovery against them pursuant to 28 U.S.C. Sec. 1782 and to quash discovery subpoenas issued pursuant to that order. Appellees Silvia Gianoli Aldunate and Jose Miguel Barriga Gianoli (the Appellees), provisional guardians of the property of Ciro Gianoli Martinez (Ciro) in a Chilean incompetency proceeding, applied ex parte to the district court for an order pursuant to 28 U.S.C. Sec. 1782 granting them discovery from the Fodens concerning Ciro's assets in the United States. Section 1782 provides, in pertinent part, that upon the application of an interested party, the district court of the district in which a person resides or is found may order him to give his testimony or to produce documents for use in a proceeding in a foreign or international tribunal.

The district court granted the Appellees' motion and issued subpoenas against the Fodens. The Fodens moved to vacate the district court's order and quash the subpoenas on the grounds that, inter alia, section 1782 requires a threshold showing that the discovery sought in the district court would be available under the laws of the foreign jurisdiction, and that the Appellees had failed to make such a showing. The district court denied the motion, and this appeal followed. For the reasons stated below, we affirm.

BACKGROUND

Ciro Gianoli Martinez, an 86 year old businessman and successful investor, resides in Santiago, Chile. Ciro married Elena Aldunate Lynch in 1935 and had four children, two of whom are still alive. Appellee Silvia Gianoli Aldunate is one of the living daughters and appellee Jose Miguel Barriga Gianoli is the son of one of the deceased daughters. Ciro and his first wife have been separated for decades, but allegedly under Chilean law are unable to obtain a divorce. Thirteen years ago, Ciro participated in a marriage ceremony in Uruguay with Ana Eguiguren Rozas (Ana), age 69, whom he had known for approximately 31 years. Ciro and Ana have lived together since the ceremony. Appellant Maria Luisa de Castro Foden is Ana's daughter and lives with her husband, appellant Edward Foden, in Connecticut.

Ciro's mental health recently deteriorated, prompting all of Ciro's living descendants to commence an incompetency proceeding before the Third Civil Court of Santiago, Chile, on April 9, 1992. The Fodens and the Appellees give differing accounts of Ciro's relationship with his daughters and Ana and of when his mental health deteriorated. The Fodens On May 22, 1992, the Third Civil Court provisionally declared Ciro incompetent. The court appointed the Appellees as Ciro's provisional general guardians. Raul Jose Alamos Letelier, Ciro's attorney and business colleague, was also appointed provisional guardian, but "for the sole purpose of assuming direct care of [Ciro], which task he shall carry out jointly with Ana Eguiguren Rozas." The court ordered that the provisional guardians conduct "[i]n due time, a certified inventory of the property of" Ciro. Ana appealed the orders of the civil court, and the Supreme Court of Chile affirmed.

claim that Ciro has been estranged from his daughters and grandchildren for years, and that it was Ciro's intention that Ana was to care for him if he became ill. They state that Ciro was in good mental and physical health up until the time of a February 1992 seizure. The Appellees state that Ciro's mental health was good and his contact with his daughters and grandchildren was "consistent and regular" up until about 1989. At that point, according to the affidavits of two medical assistants who attended to Ciro at home, Ana began to isolate Ciro from his family and friends. Ana is accused, for example, of denying Ciro use of the telephone or access to any visitors.

On June 4, 1992, the provisional guardians filed an inventory of Ciro's assets located in Chile with the Third Civil Court. In the inventory, the Appellees stated that Ciro also "possesses considerable property abroad," that they "are not, at present, in a position to give specific details on his assets," but that they are "making investigations and taking other measures to specify the amount and location of the assets located abroad" and will file an expanded inventory.

On October 27, 1992, the Appellees applied ex parte to the United States District Court for the District of Connecticut for a discovery order pursuant to 28 U.S.C. Sec. 1782. In support of their application the Appellees submitted the affidavit of George E. Deren, a financial investigator hired by the Appellees' counsel. In the affidavit, Deren describes the background of the incompetency proceeding, and then describes Casabianca Investments S.A. (Casabianca), a holding company founded by Ciro in 1981 through which "considerable" assets were held outside of Chile. Deren states that his investigations revealed that the Fodens became involved with Casabianca in September 1989, when the bank statements of a Casabianca account at Swiss Bank New York began to be mailed in care of Maria Luisa Foden to the address of her Hartford, Connecticut law office. According to the affidavit, beginning in November 1989, millions of dollars passed through the account, and the account was finally closed in September 1990. That same month, Maria Luisa Foden directed that the remaining funds in Casabianca's Daily Dollar Account be wired to a client account of hers in Hartford. Deren states that on July 10, 1990, Edward Foden had become Vice President, Secretary and a member of the board of directors of Casabianca and Maria Luisa Foden had been granted a general power of attorney by Casabianca's president. Finally, Deren states that on March 11, 1991, a meeting of the shareholders of Casabianca was held in Hartford with only the Fodens in attendance. According to the minutes, "[a]ll shares of the company issued and in circulation were present," and the shareholders resolved that Casabianca be dissolved. The Appellees asked the district court to order the Fodens to "provide any documents they have and [to] give testimony concerning the assets of Casabianca, and the current whereabouts of those assets," concluding that "[i]nformation about these assets is relevant to, and will be used in, the guardianship proceeding in the Chilean Court, in which the Guardians must file an inventory of [Ciro's] assets wherever they may be found."

On November 16, 1992, Chief Judge Cabranes granted the Appellees' application and issued subpoenas requiring the Fodens to produce documents and to appear for depositions. On January 8, 1993, the Fodens moved to vacate the order of judicial assistance and to quash the subpoenas. After briefing and oral argument, Chief Judge Cabranes orally denied the motions, holding that (1) all of the requirements of section 1782 had been satisfied, (2) section 1782 does not require that the evidence sought in the district court be discoverable under the laws

of Chile, and (3) in any event, Chilean law empowers the Appellees to obtain the information requested. The Appellees and the Fodens stipulated to a stay of discovery pending this expedited appeal.

DISCUSSION

We have jurisdiction over this appeal pursuant to 28 U.S.C. Sec. 1291. See In re Letters Rogatory Issued by the Director of Inspection of India, 385 F.2d 1017, 1018 (2d Cir.1967) (denial of motion to vacate discovery order and to quash subpoena issued pursuant to 28 U.S.C. Sec. 1782 constitutes final, appealable decision). We affirm, holding that section 1782 does not require the district court to make a finding of discoverability under the laws of the foreign jurisdiction. In addition, we hold that the district court's exercise of discretion was properly guided by the purposes of the statute.

I. History and Purposes of 28 U.S.C. Sec. 1782

An understanding of the history and purposes of 28 U.S.C. Sec. 1782 is an important first step in our inquiry. Section 1782, entitled "Assistance to foreign and international tribunals and to litigants before such tribunals," provides in pertinent part:

The district court of the district in which a person resides or is found may order him to give his testimony or statement or to produce a document or other thing for use in a proceeding in a foreign or international tribunal. The order may be made pursuant to a letter rogatory issued, or request made, by a foreign or international tribunal or upon the application of any interested person.... The order may prescribe the practice and procedure, which may be in whole or part the practice and procedure of the foreign country or the international tribunal, for taking the testimony or statement or producing the document or other thing.

28 U.S.C. Sec. 1782(a).

Federal law has provided for some form of judicial assistance to foreign courts since 1855. See Act of March 2, 1855, ch. 140, Sec. 2, 10 Stat. 630 (allowing United States courts to compel testimony in...