2d Cir.: Production Cannot be Compelled Under 28 U.S.C. §1782 for Private International Arbitrations

Today, the Second Circuit issued a decision, In Re: Application and Petition of Hanwei Guo for an Order to take Discovery for Use in a Foreign Proceeding Pursuant to 28 U.S.C. 1782, No. 19-781 (2d Cir. July 8, 2020) affirming a district court's denial of a petition under 28 U.S.C. § 1782 for an order compelling the production of documents for a private international commercial arbitration. The arbitrator in this case was the China International Economic and Trade Arbitration Commission (CIETAC). 28 U.S.C. § 1782(a) allows federal courts to compel the production of materials “for use in a proceeding in a foreign or international tribunal”.

The Court noted that the legislative history of the statute indicates the phrase 'foreign or international tribunal' should not apply to private arbitration. The relevant House and Senate reports do not make any reference to alternative dispute resolution. The opinion notes that while the Fifth Circuit has issued a ruling also finding that § 1782 should not apply to private arbitrations, the Sixth Circuit has found that it does, and the Fourth Circuit has ruled that it should apply to private arbitrations in the United Kingdom because such arbitrations are authorized by the government pursuant to a statute. The Court found that the ruling of the Supreme Court in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004) which found that Directorate General-Competition of the Commission of the European Communities (a public entity) was a tribunal under § 1782 to the extent it acted as a first instance decision maker, did not address the issue of whether a private arbitration tribunal should be covered by § 1782.

In determining whether or not a CIETAC arbitration is a private international commercial arbitration, the Court considered multiple factors to evaluate if it functions as such an entity. CIETAC operates independently of the Chinese government. The arbitrators do not have to be affiliated with the Chinese government and there is only a limited basis on which government authorities can interfere with arbitrations beyond the enforcement of awards. CIETAC only receives jurisdiction over a dispute from the parties. Consequently, Judge Debra Ann Livingston's opinion concluded that CIETAC matters should be considered private arbitrations that are not covered by § 1782.