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SCOTUS Closes the Door on Section 1782 Discovery for Private Arbitration

American Bar Association Practice Points

In this article, Brian Hill* and Rachel Mendelson discussed the U.S. Supreme Court's recent ruling that 28 U.S.C. section 1782 does not allow for U.S. court-compelled discovery in private foreign arbitrations. On June 13, 2022, the Supreme Court released its opinion in ZF Auto. US v. Luxshare, Ltd. that limits the circumstances in which participants to foreign arbitrations are entitled to discovery through U.S. courts. 142 S. Ct. 2078, 213 L. Ed. 2d 163 (2022). Under section 1782 an interested party to a "foreign or international tribunal" may be entitled to American-style discovery of third parties when relevant documents or witnesses are found within the U.S. Parties must submit an application to the district court in which the entity or individual from whom discovery is sought resides and, if the application is granted, can get discovery that includes documents, admissions, interrogatory responses, and sworn testimony. The court in ZF Auto resolved an existing circuit split, and unanimously held that "only a governmental or intergovernmental adjudicative body" is a "foreign or international tribunal" under section 1782. Id. at 178. As a result, the co-authors suggest that practitioners should consider the impact of forum selection on the availability of U.S.-based third-party discovery under section 1782 both when drafting arbitration provisions and making a forum selection after a dispute has arisen.

*Former Miller & Chevalier attorney