Sergeeva v. Tripleton Int'l Ltd.

Decision Date23 August 2016
Docket Number15-15066,Nos. 15-13008 &amp,s. 15-13008 &amp
Parties Anna Aleksandrovna Sergeeva, a natural Person and Citizen of the Russian Federation, Plaintiff–Appellee, v. Tripleton International Limited, Defendant, Trident Corporate Services, Inc., Interested Party–Appellant, Gabriela Pugh, Interested Party.
CourtU.S. Court of Appeals — Eleventh Circuit

Fredric J. Bold, Jr., Lisa R. Strauss, Bondurant Mixson & Elmore, LLP, Atlanta, GA, for PlaintiffAppellee.

Debra G. Buster, Glenn P. Hendrix, Arnall Golden & Gregory, LLP, Atlanta, GA, for Defendant.

Philip Whitworth Engle, Philip W. Engle, LLC, Roswell, GA, for Interested PartyAppellant.

Before JORDAN and ANDERSON Circuit Judges, and DALTON,* District Judge.

DALTON, District Judge:

In these consolidated appeals, Appellant challenges the U.S. District Court for the Northern District of Georgia's orders allowing discovery pursuant to Title 28, United States Code, § 1782

(Appeal No. 15-13008 (First Appeal)) and imposing contempt sanctions (Appeal No. 15-15066 (Second Appeal)). After a thorough review of the record and with the benefit of oral argument, we find no error and affirm the District Court in all respects.

I.

After dissolving their sixteen-year marriage in the Russian Federation (“Russia”), former spouses Mikhail Leopoldovich Dubin (“Ex-Husband”) and Appellee Anna Sergeeva (“Ex-Wife”) commenced a distinct proceeding in the Hoamvnischesky District Court of Moscow (“Moscow Court) for division of marital assets (“Russian Dispute”). In the Russian Dispute, Ex-Wife claimed that Ex-Husband was concealing and dissipating marital assets through and with the assistance of “offshore companies” around the world.

Ex-Husband dodged, delayed, and opposed Ex-Wife's unrelenting efforts to obtain discovery in support of her claim, and their red in tooth and claw feud played out in countries around the world, including Cyprus, Latvia, Switzerland, the British Virgin Islands (“BVI”), the Commonwealth of the Bahamas (“Bahamas”), and the United States of America. In the United States, Ex-Wife sought information from Gabriella Pugh (“Ms. Pugh”) and her employer in Atlanta, Georgia—Appellant Trident Corporate Services, Inc. (Trident Atlanta)—that she expected would reveal Ex-Husband's beneficial ownership of Bahamian corporation, Tripleton International Limited (Tripleton). When met with resistance, Ex-Wife initiated a § 1782

action in the Atlanta division of the District Court on July 25, 2013. Ex-Wife filed substantial evidence in support of her Ex Parte Application for Judicial Assistance” (“Application”), including a lengthy and detailed declaration from her attorney, Dmitry Lovyrev (“Lovyrev”). On referral, the Magistrate Judge granted the ex parte Application and authorized service of two subpoenas (“Ex Parte MJ Order”).

The subpoena issued to Trident Atlanta (“Subpoena”): (a) referenced Tripleton, and other Bahamian corporations, including Guardian Nominees (Bahamas) Limited (“Guardian Bahamas”) and Trident Corporate Services (Bahamas) Limited (“Trident Bahamas”); (b) referenced other “Trident Trust” entities located in Cyprus and Switzerland; (c) demanded production of documents possessed by Trident Trust entities located outside the United States, including Trident Bahamas; and (d) instructed Trident Atlanta to furnish all responsive documents in its “possession, custody, or control, regardless of whether such documents or materials are possessed directly by [Trident Atlanta] or by any of [Trident Atlanta's] agents, representatives, attorneys, or their employees or investigators.”

Trident Atlanta objected to the Subpoena on numerous grounds, including that it sought documents located outside the United States and required “Trident Atlanta to obtain documents from a third party.”1 Trident Atlanta also filed motions to vacate the Ex Parte MJ Order and to quash the Subpoena, which motions were referred to the Magistrate Judge, who: (a) denied the motions; (b) granted Ex-Wife's motion to compel; and (c) required production of all documents responsive to the Subpoena that are within the “possession, custody, or control” of Trident Atlanta. (“MJ Production Order”). A few months later, the Magistrate Judge also denied Trident Atlanta's request for reconsideration of the MJ Production Order. (“MJ Reconsideration Order”).

Ultimately, Trident Atlanta produced only twenty-three pages of documents from its office in Atlanta, and it objected to the MJ Production and the MJ Reconsideration Orders. On February 6, 2015, the District Court Judge overruled Trident Atlanta's objections and approved the orders entered by the Magistrate Judge. (“DJ Review Order”). Several months later, the District Court declined to reconsider the DJ Review Order and noted that Trident Atlanta's obligation to respond to the Subpoena was clear:

[Trident Atlanta] is required to respond to the [S]ubpoena as ordered by [the Magistrate Judge] on November 22, 2013. If it does not have the requested documents, it should say so via a discovery response with a clear statement as to what [Trident Atlanta] has done in order to obtain these documents. If [Trident Atlanta] cannot produce the documents after a good faith attempt to find documents, it should say so. Obviously, if [Trident Atlanta] does not tell the truth and does in fact have the practical ability to obtain the documents, this Court will order sanctions against [Trident Atlanta].

(“DJ Reconsideration Order”). Trident Atlanta then filed the First Appeal and requested stays, which requests were denied by the District Court and by this Court.

While the First Appeal was pending, Ex-Wife sought sanctions against Trident Atlanta for its failure to produce documents responsive to the Subpoena. (Sanctions Motion). The District Court determined that it retained jurisdiction concerning the sanctions issue, accepted additional evidence and briefing, and conducted an evidentiary hearing on October 6, 2015. (2015 Hearing”). The District Court granted the Sanctions Motion, held Trident Atlanta in contempt, awarded Ex-Wife her attorney's fees and costs (“Compensatory Sanction”), and ordered Trident Atlanta to produce responsive documents or pay a sanction (“Coercive Sanction”) of $500 a day for up to sixty days of any continued non-compliance. (“Contempt Order”).

In January 2016, the District Court rejected Trident Atlanta's request for relief from the Coercive Sanction and entered partial final judgment awarding $234,983.58 to Ex-Wife as the Compensatory Sanction. Trident Atlanta filed its Second Appeal, and—after consolidating the First and Second Appeals—we heard oral argument on March 9, 2016.

II.

We apply an abuse of discretion standard in reviewing district court decisions resolving applications for assistance pursuant to § 1782

. See

Lopes v. Lopes , 180 Fed.Appx. 874, 876–77 (11th Cir. 2006) (applying abuse of discretion standard in appeal of order that adopted a magistrate judge's order granting discovery pursuant to § 1782 ). We also apply an abuse of discretion standard in reviewing decisions to hold a party in civil contempt and to impose compensatory and coercive sanctions. See

F.T.C. v. Leshin , 719 F.3d 1227, 1231–32, 1239 (11th Cir. 2013) (observing that district courts have “extremely broad and flexible powers” in the civil contempt area). ‘A district court abuses its discretion if it applies an incorrect legal standard, applies the law in an unreasonable or incorrect manner, follows improper procedures in making a determination, or makes findings of fact that are clearly erroneous.’ Id . at 1230 (quoting Thomas v. Blue Cross & Blue Shield Ass'n , 594 F.3d 814, 821 (11th Cir. 2010) ).

III. Section 1782

is the product of congressional efforts, over [a] span of nearly 150 years, to provide federal-court assistance in gathering evidence for use in foreign tribunals.” Intel Corp. v. Advanced Micro Devices, Inc. , 542 U.S. 241, 247, 124 S.Ct. 2466, 159 L.Ed.2d 355 (2004). In pertinent part, § 1782 currently provides:

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 ... upon the application of any interested person and may direct that the testimony or statement be given, or the document or other thing be produced, before a person appointed by the court.... To the extent that the order does not prescribe otherwise, the testimony or statement shall be taken, and the document or other thing produced, in accordance with the Federal Rules of Civil Procedure .

28 U.S.C. § 1782(a)

(emphasis added). Examined in context, this statutory language “authorizes, but does not require,” that district courts provide judicial assistance to § 1782 applicants. See

Intel Corp. , 542 U.S. at 255, 264, 124 S.Ct. 2466 ; United Kingdom v. United States , 238 F.3d 1312, 1318–19 (11th Cir. 2001) (“Whether, and to what extent, to honor a request for assistance pursuant to § 1782 [is] committed to [the district court].”).

We have recognized four prima facie requirements that must be established before a district court may exercise its authority under § 1782

:

(1) the request must be made “by a foreign or international tribunal,” or by “any interested person”; (2) the request must seek evidence, whether it be the “testimony or statement” of a person or the production of “a document or other thing”; (3) the evidence must be “for use in a proceeding in a foreign or international tribunal”; and (4) the person from whom discovery is sought must reside or be found in the district of the district court ruling on the application for assistance.

Consorcio Ecuatoriano de Telecomunica c iones S.A. v. JAS Forwarding (USA), Inc. , 747 F.3d 1262, 1269 (11th Cir. 2014)

(quoting In re Clerici , 481 F.3d 1324, 1331 (11th Cir. 2007) ). If these requirements are met,2 then—upon consideration of four...

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