939 F.3d 710 (6th Cir. 2019), 19-5315, In re Application to Obtain Discovery for Use in Foreign Proceedings

Docket Nº:19-5315
Citation:939 F.3d 710
Opinion Judge:JOHN K. BUSH, Circuit Judge.
Party Name:IN RE: APPLICATION TO OBTAIN DISCOVERY FOR USE IN FOREIGN PROCEEDINGS. Abdul Latif Jameel Transportation Company Limited, Movant-Appellant, v. FedEx Corporation, Respondent-Appellee.
Attorney:David Livshiz, FRESHFIELDS BRUCKHAUS DERINGER, U.S. LLP, New York, New York, for Appellant. Daniel T. French, FEDERAL EXPRESS CORPORATION, Memphis, Tennessee, for Appellee. David Livshiz, Linda H. Martin, Paige von Mehren, FRESHFIELDS BRUCKHAUS DERINGER, U.S. LLP, New York, New York, Shea Sisk We...
Judge Panel:Before: COLE, Chief Judge; GRIFFIN and BUSH, Circuit Judges.
Case Date:September 19, 2019
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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939 F.3d 710 (6th Cir. 2019)

IN RE: APPLICATION TO OBTAIN DISCOVERY FOR USE IN FOREIGN PROCEEDINGS.

Abdul Latif Jameel Transportation Company Limited, Movant-Appellant,

v.

FedEx Corporation, Respondent-Appellee.

No. 19-5315

United States Court of Appeals, Sixth Circuit

September 19, 2019

Argued: August 8, 2019

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Appeal from the United States District Court for the Western District of Tennessee at Memphis. No. 2:18-mc-00021-Jon Phipps McCalla, District Judge.

ARGUED:

David Livshiz, FRESHFIELDS BRUCKHAUS DERINGER, U.S. LLP, New York, New York, for Appellant.

Daniel T. French, FEDERAL EXPRESS CORPORATION, Memphis, Tennessee, for Appellee.

ON BRIEF:

David Livshiz, Linda H. Martin, Paige von Mehren, FRESHFIELDS BRUCKHAUS DERINGER, U.S. LLP, New York, New York, Shea Sisk Wellford, MARTIN, TATE, MORROW & MARSTON, P.C., Memphis, Tennessee, for Appellant.

Daniel T. French, Colleen Hitch Wilson, FEDERAL EXPRESS CORPORATION, Memphis, Tennessee, for Appellee.

Before: COLE, Chief Judge; GRIFFIN and BUSH, Circuit Judges.

OPINION

JOHN K. BUSH, Circuit Judge.

Thomas Jefferson once counseled his nephew Peter Carr on how to think: "Fix reason firmly in her seat, and call to her tribunal every fact, every opinion."1 This case calls upon us to do just that. We must decide whether Abdul Latif Jameel Transportation Company Limited ("ALJ"), a Saudi corporation, may rely on 28 U.S.C. § 1782(a) to discover facts from FedEx Corporation ("FedEx Corp."), a U.S.-based corporation, for use in a commercial arbitration pending in a foreign country. Under § 1782(a), a federal district court may order discovery "for use in a proceeding in a foreign or international tribunal" upon application by "any interested person." Jefferson used the word "tribunal" in a metaphorical sense to refer to the mind. We must decide whether Congress used the words "foreign or international tribunal"

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in a literal sense that includes the commercial arbitration involved here.

In its § 1782(a) discovery application, ALJ sought a subpoena for documents from FedEx Corp. and deposition testimony of a corporate representative of that company. ALJ alleges that FedEx Corp. was involved in contract negotiations and performance of two contracts between ALJ and FedEx International Incorporated ("FedEx International"), a subsidiary of FedEx Corp. Each contract became the subject of a commercial arbitration, one pending in Dubai in the United Arab Emirates ("UAE"), the other brought in the Kingdom of Saudi Arabia. As explained below, we only address the availability of discovery for the Dubai arbitration because the arbitration in Saudi Arabia was dismissed, rendering moot ALJ’s application as it pertains to this latter proceeding.

The district court denied ALJ’s application, holding that the phrase "foreign or international tribunal" in § 1782(a) did not encompass either of the two arbitrations. ALJ now appeals, arguing that the phrase "foreign or international tribunal" does include such proceedings and that ALJ’s discovery request should be granted.

The interpretive question is an issue of first impression in the Sixth Circuit, although the Supreme Court provided guidance for interpretation of § 1782(a) in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 124 S.Ct. 2466, 159 L.Ed.2d 355 (2004). Upon careful consideration of the statutory text, the meaning of that text based on common definitions and usage of the language at issue, as well as the statutory context and history of § 1782(a), we hold that this provision permits discovery for use in the private commercial arbitration at issue. Accordingly, we REVERSE the district court’s denial of ALJ’s application and REMAND for the district court to determine, in the first instance, whether the application should be granted under four discretionary factors the Supreme Court outlined in Intel to guide that determination.

I. BACKGROUND

A. The Dispute Between ALJ and FedEx International

This dispute over statutory linguistics arises from supply-chain logistics. In 2014, after a period of negotiations, FedEx International entered a "General Service Provider" ("GSP") contract with ALJ. Under that contract (which was amended in 2015), ALJ agreed to be FedEx International’s delivery-services partner in Saudi Arabia, where ALJ is incorporated. By agreement of the parties, disputes relating to the GSP were to be arbitrated in Dubai under the rules of the Dubai International Financial Centre-London Court of International Arbitration ("DIFC-LCIA").

In 2016, FedEx International and ALJ entered another contract, the Domestic Service Agreement ("DSA"), under which FedEx International promised to provide ALJ with "certain support services." R. 3, PageID 38. Those parties also agreed to arbitrate disputes arising under the DSA in Saudi Arabia under the rules and laws of that country.

After FedEx International and ALJ signed the GSP contract but before they entered the DSA, FedEx Corp.— the parent of FedEx International and appellee in this case— acquired TNT Express N.V. ("TNT"), a competitor in the delivery-services market in Saudi Arabia. According to ALJ, it did not become aware of the acquisition until it was already fait accompli .

The parties disagree in part about the causes of the underlying dispute. ALJ suggests that FedEx Corp. was significantly involved in luring ALJ into a contractual relationship with FedEx International.

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ALJ also indicates that FedEx Corp. and FedEx International kept ALJ in the dark about the impending TNT acquisition. According to ALJ, when it learned of the TNT acquisition, FedEx Corp. and FedEx International misled ALJ to believe that the future of its contractual relationship with FedEx International was secure. ALJ contends that, for several weeks during the fall of 2017, FedEx International failed to provide ALJ with the support promised in the DSA. Then, "without warning," according to ALJ, FedEx International announced that it would not be renewing the GSP contract and that ALJ would have to bid against other potential contractors if it wanted to keep working with FedEx International. Appellant Br. at 10.

FedEx Corp. responds that ALJ’s brief overstates, and makes false assertions about, FedEx Corp.’s involvement in the negotiations and communications between FedEx International and ALJ. Additionally, FedEx Corp. disagrees that FedEx International was at fault in causing the ALJ-FedEx International rift. According to FedEx Corp., the trouble between ALJ and FedEx International started when ALJ began providing unsatisfactory service; FedEx International sought to work with ALJ but eventually gave up and decided to open up ALJ’s position as FedEx International’s general service partner in Saudi Arabia to bidding among various applicants.

These factual disputes aside, ALJ and FedEx Corp. agree that attempts to reconcile soon broke down completely. On March 4, 2018, ALJ commenced arbitration against FedEx International (the "Saudi Arbitration") before a panel constituted under the rules and laws of Saudi Arabia, as provided in the DSA. A few weeks later, on March 21, FedEx International commenced arbitration against ALJ (the "DIFC-LCIA Arbitration") before a panel constituted under the rules of the DIFC-LCIA, as provided in the GSP contract.

The DIFC-LCIA Arbitration panel consists of three members appointed by the DIFC-LCIA Arbitration Centre. According to FedEx Corp., the DIFC-LCIA Arbitration Centre is a joint venture of the London Court of International Arbitration and the DIFC Arbitration Institute.2 The DIFC Arbitration Institute, in turn, was established by statute in the emirate of Dubai. Awards of the arbitral panel are reviewable by the DIFC Court, which was also established by statute in Dubai. The DIFC Court reviews arbitral awards for procedural soundness under the DIFC Arbitration Law, which was promulgated by the Dubai government. In addition, if a party challenges an award alleging inconsistency with UAE public policy, the award is reviewed under the law of the UAE. Aside from these review provisions, however, awards of the panel are binding on the parties. A merits hearing in the pending DIFC-LCIA Arbitration between ALJ and FedEx International is currently scheduled for November 3-9, 2019.

As for the makeup and operations of the Saudi Arbitration panel, we do not go into details because on April 30, 2019 (shortly after ALJ filed this appeal), that panel issued an award dismissing ALJs claims. ALJ has challenged the dismissal and is awaiting a decision. Below, in section II(A), we explain why the dismissal of the Saudi Arbitration has rendered moot the...

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