The U.S. offers a very powerful litigation tool for participants in Italian legal proceedings and arbitrations to obtain bank records, documents and witness testimony from sources within the U.S., even if such evidence is unobtainable through Italian court procedures. This procedure, authorized under 28 U.S.C. §1782, is a relatively quick and efficient method for obtaining crucial information to win a case. There is no need to obtain Letters Rogatory or pursue discovery through the Hague Evidence Convention.
What Information Can Be Obtained?
Documents and witness testimony can be obtained including:
- International Wire Transaction Records (U.S. Dollar wires typically transit the U.S.)
- Emails, Correspondence, Phone and Travel Records
- Banking, Credit Card and Business Transaction Records
- Corporate Documents including Shareholder and Board Meeting Records
- Accounting, Employment and Intellectual Property Records
- Property and Real Estate Transaction Records
- Attorney Records (that are not subject to attorney-client privilege)
- Medical and Educational Records
- Deposition testimony of individuals, employees and corporate officers
U.S. Courts Frequently Allow Discovery For Use In Italian Legal Proceedings
Discovery has frequently been granted for use in Italian disputes. For example:
- In In re Application for Discovery Pursuant to 28 U.S.C. §1782, 2020 U.S. Dist. LEXIS 10243 (N.D. Ohio Jan. 22, 2020) the United States District Court for the Northern District of Ohio upheld the court’s grant of §1782 ex parte discovery. The court had originally granted the §1782 application to get post judgment execution in an Italian probate case against two Italian defendants in the U.S. The respondents argued that since the probate case was concluded, there was no anticipated or current proceeding, which the statute requires. But the court sided with the applicants in light of the Supreme Court’s recognition of the “broad range of discovery” authorized by §1782 under the controlling decision in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004) and in light of the difference between seeking evidence under §1782 and enforcing a judgment.
- In In re Ex Parte Caterpillar, Inc., 2020 U.S. Dist. LEXIS 70913 (M.D. Tenn. April 21, 2020), the court upheld its grant of §1782 discovery to Caterpillar, an American corporation, from Deere, another American corporation, for use in three Italian patent proceedings wherein a foreign subsidiary of Caterpillar sued the foreign subsidiary of Deere for patent infringement. This was all against the backdrop of lawsuits filed in the U.S. in the Districts of Minnesota and Delaware regarding the same patents. Working through the statutory and discretionary factors, the Court upheld the §1782 discovery and ordered production within thirty days.
- In In re Mariani, 2020 U.S. Dist. LEXIS 67073 (S.D.N.Y. April 16, 2020) an Italian citizen applied for §1782 discovery from Citibank in the Southern District of New York for use in a pending divorce proceeding in the Ordinary Court of Florence. All statutory and discretionary factors were easily satisfied and the subpoenas were allowed.
The Process For Obtaining Discovery In The U.S.
For Use In Italy Is Not Complicated
The United States Supreme Court has stated that the “twin aims” of 28 U.S.C. §1782 discovery are “providing efficient assistance to participants in international litigation and encouraging foreign countries by example to provide similar assistance to our courts.” An Italian litigant can readily utilize this law and the procedures for obtaining U.S. discovery are not complicated.
First, the Italian litigant should determine what information located in the U.S. it wants to obtain – accounting and banking records, emails, corporate resolutions, etc. Then the litigant should determine what person or entity possesses the information and where in the U.S. they are located. This is important, because this determines in which U.S. federal judicial district the discovery application should be filed.
Second, the “Application” is prepared and filed by U.S. counsel and typically requests authorization to issue a subpoena, or subpoenas, for the production of documents or for a witness to appear for deposition. In order for the court to grant the Application, certain statutory considerations must be satisfied. The Application should set forth the following: (1) the person from whom discovery is sought resides or can found within the district of the federal court, for example, if wire transfer records are being sought, the proper forum for filing the Application is the United States District Court for the Southern District of New York, through which international wires typical;;y transit; (2) the information is “for use in a proceeding in a foreign or international tribunal”; and (3) explaining how the discovery sought can be utilized to some advantage or serve some use in the Italian proceeding – there is no requirement that the discovery be admissible or discoverable in the Italian proceeding. The court will consider additional discretionary factors, but these can usually can satisfied with a well crafted Application addressing whether the discovery target is a party to the Italian proceedings or subject to the jurisdiction of the Italian court, the nature of the Italian proceedings and/or addressing any relevant Italian and U.S. public policy interests.
Third, if the Application is granted, subpoenas are served upon the discovery targets for the production of documents or appearance of witnesses. Often, notice is given to the opposing party in the Italian litigation. In some cases, the discovery targets will simply comply with the subpoena and produce documents or appear for deposition. In other cases, the discovery target may file a motion with the court opposing or seeking to narrow the scope of discovery. In still other cases, the opposing party in the Italian litigation may “intervene” and seek to vacate or otherwise oppose the order granting discovery, including seeking a protective order limiting use of the discovery to just the Italian litigation. The discovery Applicant will have the opportunity to respond, and the American court will rule, more often than not, in favor of the discovery Applicant, in accordance with the “twin aims” of 28 U.S.C. §1782, and require the discovery targets to comply with the subpoenas.
Thomas C. Sullivan is an attorney in the Philadelphia office of Marks & Sokolov LLC. Mr. Sullivan represents Western, Russian and Ukrainian clients in complex commercial disputes including civil RICO, securities fraud, Foreign Corrupt Practices Act, Convention on the International Sale of Goods and ICC Arbitration matters. He has litigated numerous Section 1782 discovery matters throughout the United States and was recently published in Obtaining U.S. Discovery For Use In Non-U.S. Tribunals Pursuant To 28 U.S.C. § 1782 (Chapter 7), Juris Publishing, LLC, 2020.
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