In re Servicios

Decision Date06 July 2016
Docket NumberMISC. ACTION NO. 4:14-mc-1186
CourtU.S. District Court — Southern District of Texas

The above referenced ex parte Application of Petitioner Gazprom Latin America Servicios, C.A. ("Gazprom") for Assistance pursuant to 28 U.S.C. § 17821 seeks to compel personal testimonyand production of documents from Respondents Lindsayca, Inc.2 and Jean-Marc Pivert ("Pivert"), both purportedly located in the Southern District of Texas and residents of Texas. Gazprom represents that the discovery sought is to assist the Twelfth Courtof First Instance in Civil, Commercial, Transit and Banking Matters for the Judicial District of the Metropolitan Area of Caracas, Venezuela (the "Venezuelan Court") in a pending dispute and an ancillary seizure case, which in part is related to alleged nonpayment to Lindsayca, C.A. by Gazprom of a $8,781,196.75 invoice, plus interest and legal fees, in connection with a service contract for the construction and installation of a $43 million natural gas compression plant for Gazprom in Venezuela.3 Pendingbefore the Court are (1) Respondent Jean-Marc Pivert's ("Pivert's") motion to vacate orders (instrument #16 as it relates to #7), (2) United States Magistrate Judge Frances Stacy's recommendation (instrument #46) that this Court grant Pivert's motion (#16) to vacate #7; (3) Gazprom's objections (#49) to the Magistrate Judge's Recommendation (#46); and (4) Pivert's response (#51) to the Magistrate Judge's recommendation.

Standard of Review

Nondispositive and dispositive motions may be referred to the magistrate judge for a memorandum and recommendation under 28 U.S.C. section (b)(1) and Fed. R. Civ. P. 72. Title 28 U.S.C. § 636(b)(1) provides,

(A) A judge may designate a magistrate judge to hear and determine any pretrial matter pending before the court, except a motion for injunctive relief, for judgment on the pleadings, for summary judgment, to dismiss or quash an indictment or information made by the defendant, to suppress evidence in a criminal case, to dismiss or to permit maintenance of a class action, to dismiss for failure to state a claim upon which relief can be granted, and to involuntarily dismiss an action. A judge of the court may reconsider any pretrial matter underthis subparagraph (A) where it has been shown that the magistrate judge's order is clearly erroneous or contrary to law.
(B) a judge may also designate a magistrate judge to conduct hearings including evidentiary hearings, and to submit to a judge of the court proposed findings of fact and recommendations for the disposition, by a judge of the court, of any motion excepted in subparagraph (A), of applications for posttrial relief made by individuals convicted of criminal offenses and of prisoner petitions challenging conditions of confinement.

Similarly, nondispositive matters may be referred to the magistrate judge under Rule 73(a), and dispositive motions, under Rule 72(b).

Objections to a magistrate judge's memorandum and recommendation must specifically identify the findings or recommendations for which the party seeks reconsideration. Byars v. Stephens, No. 5:13-CV-189-DAE, 2014 WL 1668488, at *2 (Apr. 14, 2014), citing Thomas v. Arn, 474 U.S. 140, 151 (1985). The court does not have to consider "'[frivolous, conclusive, or general objections.'" Id., citing Battle v. U.S. Parole Comm'n, 834 F.2d 419, 421 (5th Cir. 1987). A determination by a magistrate judge to which the party specifically objects regarding a dispositive matter must be reviewed de novo under 28 U.S.C. § 636(b)(1)(c). The Magistrate Judges's decision about a nondispositive matter is reviewed under a "clearly erroneous or contrary to law" standard. 28 U.S.C. § 636(b)(1)(A); Fed. R. Civ. P. 72(a)("The district judge . . . must . . . modify or set aside any part of the order that is clearly erroneous or is contrary to law."). Findings to which no specific objections are made require that the Court only to decidewhether the memorandum and recommendation is clearly erroneous or contrary to law. Id., citing U.S. v. Wilson, 864 F.2d 1219, 1221 (5th Cir. 1989). Under this deferential standard of review the court must affirm the magistrate judge's description unless it finds that based on all the evidence it is "left with a definite and firm conviction that a mistake has been committed." Baylor Health Care Sys. v. Equitable Plan Services, Inc., 955 F. Supp. 2d 678, 689 (N.D. Tex. 2013), quoting U.S. v. Gypsum Co., 333 U.S. 364, 395 (1948). The district court reviews the magistrate judge's legal conclusions de novo. Lahr v. Fulbright & Jaworski, LLP, 164 F.R.D. 204, 208 (N.D. Tex. 1996); Tolan v. Cotton, H-09-1324, 2015 WL 5332171, at *1 (S.D. Tex. Sept. 14, 2015). In the "vast area of choice that remains to the magistrate judge who has properly applied the law to fact findings that are not clearly erroneous," the standard of review is abuse of discretion. Lahr, 164 F.R.D. at 208; Bancroft Life & Cas. ICC, Ltd. v. FFD Resources II, LLC, 884 F. Supp. 2d 535, 537-38 (S.D. Tex. 2012). The district court "may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge." 28 U.S.C. § 636(b)(1)(C). The district court "may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge." 28 U.S.C. § 636(b)(1)(C); Fed. R. Civ. P. 72(b)(3).

"'[I]t is neither uncommon nor improper for district courts togrant ex parte applications made pursuant to § 1782. The respondent's due process rights are not violated because he can later challenge any discovery request by moving to quash pursuant to Federal Rule of Civil Procedure 45(c)(3).'" In re Application of Eurasian Bank Joint Stock Company for Expedited Judicial Assistance Pursuant to 28 U.S.C. § 1782, No. 3:15-mc-106-K-BN, 2015 WL 6438256, at *1 (N.D. Tex. Oct. 21, 2015), citing Gushlak v. Gushlak, 486 Fed. Appx. 215 (2d Cir. July 3, 2012). Before the court may grant relief under 28 U.S.C. § 1782, as the first step the petitioner must satisfy the statutory jurisdictional requirements: "(1) the person from whom discovery is sought must reside or be found in the district in which the application is filed; (2) the discovery must be for use in a proceeding before a foreign tribunal; and (3) the application must be made by a foreign or international tribunal or ''any interested person.''" Bravo Express Corp. v. Total Petrochemicals & Refining USA, Inc., 613 Fed. Appx. 319, 322 (5th Cir. June 2, 2015), citing Tex. Keystone v. Prime Natural Res., Inc., 694 F.3d 548, 553 (5th Cir. 2012)("Section 1782 allows an interested party . . . to obtain discovery related to the foreign proceeding where the source of the discovery can be found within the jurisdiction of the district court."). Nevertheless a person "may not be compelled to give his testimony or statement or to produce a document or other thing in violation of any legally applicable privilege." 28 U.S.C. § 1762;In re Application of Chevron Corp., Misc. No. H-10-134, 2010 WL 2038826, at *1 (S.D. Tex. May 20, 2010). Even if the interested party satisfies these three requirements, the court, with a view to the two goals of the statute, i.e. "'to provide efficient means of assistance to participants in international litigation in our federal courts and to encourage foreign countries by example to provide similar means of assistance to our courts,'" the court still has discretion whether to grant the application. Texas Keystone, 694 F.3d at 553-54, citing In re Ishihara Chem Co. 251 F.3d 120, 124 (2d Cir. 2001), abrogated on other grounds by Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004).

Once the jurisdictional requirements are met, in the second step, a district court again is not required to grant a § 1782(a) discovery application simply because it has the authority to do so," but it should consider four factors established in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 264-65 (2004), to guide it in deciding whether to exercise its discretion: (1) whether "the person from whom discovery is sought is a participant in the foreign proceeding," because "nonparticipants in the foreign proceeding may be outside the foreign tribunal's jurisdictional reach" and therefore their evidence, "available in the United States," may be "unobtainable absent § 1782(a) aid"; (2) "the nature of the foreign tribunal, the character of the proceedings underway abroad, and the receptivity of the foreign government,court, or agency abroad to U.S. federal-court judicial assistance"; (3) "whether the § 1782(a) request conceals an attempt to circumvent foreign proof-gathering restrictions or other policies of a foreign country or the United States"; and (4) whether the § 1782(a) request is "unduly intrusive or burdensome." Bravo Express, 613 Fed. Appx. at 323-24, citing Intel Corp., 542 U.S. at 264-65.

A number of courts receiving requests to conduct discovery for use in a foreign proceeding have read into § 1782 an initial requirement that the material sought must be located in the United States and that witnesses cannot be compelled to produce documents located outside of this country. In re Application Pursuant to 28 U.S.C. § 1782 for Discovery from Slawomir Laczor, No. 1:14-mc-44, 2014 WL 4181618, at *3 (S.D. Ohio Aug. 31, 2014)(and cases cited therein), citing inter alia In re Godfrey, 526 F. Supp. 2d 417, 423 (S.D.N.Y. 2007)(the statute's legislative history establishes that § 1782 "was intended to aid in obtaining oral and documentary evidence in the United States . . . and was not intended to provide discovery of evidence maintain[ed] within a foreign district").

The Federal Rules of Civil Procedure govern discovery requests after the district court grants a § 1782 application, thus allowing foreign litigants to obtain discovery in the...

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