Application of Consorcio Equatoriano De Telecomunicaciones S.A. v. Jet Air Service Equador S.A. , 747 F.3d 1262 ( 2014 )

[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 11-12897
________________________
D.C. Docket No. 1:10-mc-22320-DLG
APPLICATION OF CONSORCIO ECUATORIANO DE
TELECOMUNICACIONES S.A.,
Pursuant to 28 USC 1782 for Judicial Assistance in
Obtaining Evidence From JAS Forwarding (USA), Inc.,
For Use In a Foreign Tribunal,
Plaintiff - Appellee,
versus
JAS FORWARDING (USA), INC.,
Defendant,
JET AIR SERVICE EQUADOR S.A.,
Intervenor - Appellant.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(January 10, 2014)
Before MARCUS and BLACK, Circuit Judges, and HODGES, * District Judge.
*
Honorable Wm. Terrell Hodges, United States District Judge for the Middle District of Florida,
sitting by designation.
MARCUS, Circuit Judge:
We sua sponte vacate the prior opinion in this case, issued on June 25, 2012
and published at 685 F.3d 987 (11th Cir. 2012), and substitute the following
opinion in its place.
This appeal arises out of a foreign shipping contract billing dispute between
Consorcio Ecuatoriano de Telecomunicaciones S.A. (“CONECEL”) and Jet Air
Service Equador S.A. (“JASE”). CONECEL filed an application in the Southern
District of Florida under 28 U.S.C. § 1782 to obtain discovery for use in foreign
proceedings in Ecuador. According to CONECEL, the foreign proceedings
include both a pending arbitration brought by JASE against CONECEL for non-
payment under the contract, and contemplated civil and private criminal suits
CONECEL might bring against two of its former employees who, CONECEL
claims, may have violated Ecuador’s collusion laws in connection with processing
and approving JASE’s allegedly inflated invoices. CONECEL’s application seeks
discovery from JASE’s United States counterpart, JAS Forwarding (USA), Inc.
(“JAS USA”), which does business in Miami and was involved in the invoicing
operations at issue in the dispute. The district court granted the application and
authorized CONECEL to issue a subpoena. Thereafter, JASE intervened and
moved to quash the subpoena and vacate the order granting the application. The
2
district court denied the motion, as well as a subsequent motion for
reconsideration. JASE now appeals the denial of both.
After thorough review and having had the benefit of oral argument, we
affirm the orders of the district court. We hold that CONECEL’s contemplated
suits in Ecuador against its former employees satisfy the statutory requirements,
because, as the Supreme Court put it in Intel Corp. v. Advanced Micro Devices,
Inc., 542 U.S. 241 (2004), the anticipated proceedings were “within reasonable
contemplation.” Id. at 259. We also hold that the district court did not abuse its
considerable discretion in granting the section 1782 discovery application over
JASE’s objections that it would be forced to produce proprietary and confidential
information. The application was narrowly tailored and primarily requested
information concerning JASE’s billing of CONECEL, which is undeniably at issue
in the current dispute between the parties. Finally, the district court did not abuse
its discretion in denying JASE’s motion for reconsideration.
I.
CONECEL and JASE have had a lengthy contractual relationship that
reaches back at least a decade. 1 JASE agreed to provide transportation logistics
services in connection with the international transportation of cell phones and
accessories for CONECEL. The contracts between the parties contain descriptions
1
The agreements themselves are confidential and not part of the record. The parties both
describe in materially similar terms the overall contours of the agreements, however.
3
of the potential services to be provided by JASE and detailed terms pertaining to
the rate to be charged per applicable unit of weight transported. According to
CONECEL, between 2002 and 2007 JASE invoiced, and CONECEL paid, more
than $88 million for services rendered under the contracts. The relationship
between the parties soured in 2008, and CONECEL contends that an internal
investigation and audit “using the limited documentation in its possession”
revealed that CONECEL had been improperly overbilled by millions of dollars.
CONECEL says that the agreements between the parties provided that
CONECEL would pay the rate specified by the agreements (in terms of dollars per
unit of weight) multiplied by the weight of the shipment. CONECEL contends that
JASE introduced an “extra-contractual multiplication factor” into the equation,
which “varied from shipment to shipment based on factors that are not known to
CONECEL.” 2 CONECEL also claims that the calculation of the “chargeable
weight” of the shipments was erroneous.
2
Specifically, CONECEL claims that JASE inflated the invoices in this way:
Stated mathematically, the process employed by JAS Ecuador looked like this:
(gross weight or volumetric weight, whichever was higher) x (the extra-
contractual multiplication factor) x (rate to be charged per the parties’ agreement)
= amount billed to CONECEL. The extra-contractual multiplication factor
applied in this process was at the heart of the scheme which resulted in over-
billing and damages to CONECEL.
4
CONECEL reports that an internal investigation and audit has led it to
believe that two of its former employees, Lucy Egas Ribadeneira (“Egas”) and
Germania Narváez (“Narváez”), had a hand in the overbilling scheme. The two
former employees allegedly “participated in the processing and approval of JAS
Ecuador’s invoices during the relevant period and . . . there are indications that
Ribadeneira and Narváez may be liable to CONECEL for its damages.”
CONECEL adds that its contemplated civil action for collusion would be filed in
the civil-mercantile court of competent jurisdiction in Quito, Ecuador, and that
under the applicable procedural rules, CONECEL must present all of the evidence
necessary to support its claims at the moment it files the action. Then, if successful
in a civil action, CONECEL could, under Ecuadorian law, pursue a private
criminal action against its former employees. Since a party must present its
evidence up front along with the pleadings, CONECEL seeks the discovery
specified in section 1782 before commencing suit in Ecuador.
Not surprisingly, JASE tells a wholly different story. It claims that in 2008
CONECEL failed to pay several invoices. Pursuant to the contractual agreements
between the parties, JASE has pursued arbitration in Ecuador before the Center for
Arbitration and Conciliation of the Guayaquil Chamber of Commerce.
CONECEL’s primary defense in the pending arbitration proceeding is that the
invoices do not correspond to the parties’ agreed-upon price.
5
II.
On July 14, 2010, CONECEL filed an ex parte application for judicial
assistance in the Southern District of Florida in order to obtain evidence pursuant
to 28 U.S.C. § 1782. Section 1782 provides in relevant part:
The district court of the district in which a person resides or is found
may order him to give his testimony or statement or to produce a
document or other thing for use in a proceeding in a foreign or
international tribunal, including criminal investigations conducted
before formal accusation. The order may be made pursuant to a letter
rogatory issued, or request made, by a foreign or international tribunal
or upon the application of any interested person and may direct that
the testimony or statement be given, or the document or other thing be
produced, before a person appointed by the court. . . . To the extent
that the order does not prescribe otherwise, the testimony or statement
shall be taken, and the document or other thing produced, in
accordance with the Federal Rules of Civil Procedure.
28 U.S.C. § 1782(a).
CONECEL’s detailed application, accompanied by two declarations and a
memorandum of law, sought evidence from JAS USA relating primarily to the
invoicing and calculation of rates charged to CONECEL. 3 The application was
3
More specifically, CONECEL’s application requested the following discovery from the
relevant time period of January 1, 2002 up through and including December 31, 2008:
I. Document Production
(a) Any and all documents pertaining or relating to the rates charged or to be
charged to CONECEL for any of JAS Ecuador’s or its affiliates’ services.
(b) Any and all documents pertaining or relating to the procedure or methodology
for applying the rates to be charged to CONECEL for any of JAS Ecuador’s or its
affiliates’ services.
6
also accompanied by a sample air waybill purporting to show that JAS USA’s
Miami office was involved in the provision and invoicing of transport services to
CONECEL.
(c) Any and all documents pertaining or relating to the calculation of “gross
weight” and “chargeable weight” for services provided by JAS Ecuador or its
affiliates to CONECEL.
(d) Any and all documents pertaining to Jet Air Service (Ecuador) S.A.’s billing
or invoicing to CONECEL.
(e) Any and all documents pertaining to JAS Ecuador Forwarding S.A.’s billing
or invoicing to CONECEL.
(f) Any and all documents pertaining or relating to Lucy Egas Ribadeneira.
(g) Any and all documents pertaining or relating to Germania Narváez.
(h) Any and all documents evidencing the actions of and services rendered by
JAS USA in connection with shipments to CONECEL or via Jet Air Service
(Ecuador) S.A., or JAS Ecuador Forwarding S.A., or JAS USA.
(i) Any and all documents pertaining to any audit, accounting, tabulation or
investigation undertaken by JAS USA alone or in collaboration with any of its
affiliates in relation to JAS Ecuador’s claims in the Ecuadorian Arbitration Case
or the actions of former CONECEL employees, Lucy Egas Ribadeneira and / or
Germania Narváez.
II. Deposition(s)
(a) The sworn deposition of the JAS USA person (or persons) with most
knowledge regarding:
1. The documents requested by CONECEL, including without limitation their
authentication;
2. The services rendered to CONECEL by JAS Ecuador Forwarding S.A., Jet Air
Service (Ecuador) S.A., JAS Ecuador, and/or JAS USA from January 1, 2002, up
through and including, December 31, 2008.
7
On July 20, 2010, the district court granted the ex parte application and
authorized CONECEL to issue and serve a subpoena on JAS USA seeking the
discovery outlined in CONECEL’s application. JASE moved to intervene to
vacate the order granting the application. After full briefing, the district court
permitted the intervention but denied the motion to vacate.
The district court began its analysis by addressing the “primary disputed
issue” of “whether the subpoenaed documents will be used in a proceeding [in] a
foreign or international tribunal.” The court observed that, as interpreted by the
Supreme Court, section 1782 does not require that the foreign proceeding be
pending or imminent, but rather only that the proceeding “be within reasonable
contemplation.” Intel, 542 U.S. at 259. The district court determined that
CONECEL had “established that the civil and criminal actions are within
reasonable contemplation.” Having concluded that CONECEL’s civil and criminal
suits against its two former employees were within reasonable contemplation, the
district court did not have to reach the question of whether the pending arbitration
between JASE and CONECEL was a proceeding in a foreign tribunal under the
statute. The court did observe, however, that “upon a review of the case law, the
Court finds that the arbitral tribunal, in this action, is likely within the purview of
section 1782.”
8
Finally, as for JASE’s argument that the application should have been
denied anyway because CONECEL sought confidential materials, the district court
rejected the claim this way:
JAS Ecuador’s primary discretionary argument is that the subpoena
requests confidential materials. The Court disagrees. The subpoena
simply requests information as it relates to how JAS Ecuador billed or
invoiced CONECEL. It does not request information on how JAS
Ecuador bills other clients. Indeed, it relates directly to the contract at
issue -- the same contract JAS Ecuador uses to assert confidentiality.
Accordingly, the Court finds this argument without merit.
. . . [T]he Court does not find that JAS Ecuador is embarking on a
“fishing expedition.” The Court finds the Subpoena narrowly tailored
and not unduly intrusive or burdensome. Accordingly, the motion to
quash must be denied.
JASE moved for reconsideration; the district court denied the motion,
concluding that it appeared to be nothing more than an effort to relitigate matters
that the court had already decided. This timely appeal of both the order denying
JASE’s motion to vacate and the order denying JASE’s motion for reconsideration
followed.
III.
A district court’s decision to honor or deny a section 1782 discovery request
is reviewed for abuse of discretion. United Kingdom v. United States, 238 F.3d
1312, 1319 (11th Cir. 2001). This deferential standard is identical to the one we
use when reviewing a district court’s ordinary discovery rulings, including rulings
9
such as whether the foundation for a claim of privilege has been established. Id.
To the extent the district court’s decision is based on an interpretation of law,
however, our review is de novo. Id. at 1319 n.8. Thus, we review de novo the
district court’s interpretation of a federal statute like section 1782. In re Clerici,
481 F.3d 1324, 1331 (11th Cir. 2007). Finally, we review the district court’s
denial of a motion for reconsideration only for abuse of discretion. Richardson v.
Johnson, 598 F.3d 734, 740 (11th Cir. 2010) (per curiam); Sanderlin v. Seminole
Tribe of Fla., 243 F.3d 1282, 1285 (11th Cir. 2001).
Three issues are raised in this appeal: first, whether there is a “proceeding in
a foreign or international tribunal,” 28 U.S.C. § 1782(a), for which CONECEL
sought discovery; second, assuming the statutory requirements have been met,
whether the district court nonetheless abused its discretion in granting the
application because the disclosures would reveal confidential pricing information;
and, third, whether the court abused its discretion in denying JASE’s motion for
reconsideration. We take each issue in turn. We emphasize, however, that this
appeal is not about whether JASE actually overbilled CONECEL, with or without
the collusion of CONECEL’s former employees; or whether CONECEL owes
JASE any money under the contracts between the parties; or, finally, whether any
other underlying dispute among the parties and related persons has merit. Like the
10
district court, we have no occasion to address any of these issues, which will likely
be resolved in various tribunals in Ecuador.
A.
Title 28 U.S.C. § 1782 “is the product of congressional efforts, over the span
of [more than] 150 years, to provide federal-court assistance in gathering evidence
for use in foreign tribunals.” Intel, 542 U.S. at 247. Back in the 1850’s, Congress
first provided for federal-court aid to foreign tribunals, specifically by authorizing
the federal courts to respond to letters rogatory forwarded through diplomatic
channels. See id. The scope of federal courts’ authority to assist foreign tribunals
has expanded ever since. In 1948, “Congress substantially broadened the scope of
assistance” by “eliminat[ing] the prior requirement that the government of a
foreign country be a party or have an interest in the proceeding.” Id. at 247-48. As
amended in 1949, the new statute, section 1782, allowed for district court
assistance with the taking of depositions to be used in any judicial proceeding
pending in any court in a foreign country with which the United States is at peace.
See id. at 248. In 1964, section 1782 was completely revised and considerably
broadened. As revised, the statute provided for assistance in obtaining
documentary and other tangible evidence in addition to deposition testimony. Id.
In addition, Congress notably deleted the words “in any judicial proceeding
pending in any court in a foreign country” and replaced them with the words “in a
11
proceeding in a foreign or international tribunal” in order to ensure that assistance
was not confined to proceedings before conventional courts, but rather extended to
administrative and quasi-judicial proceedings. See id. at 248-49. Finally, in 1996,
Congress broadened the statute further still, adding that proceedings in a foreign or
international tribunal “includ[e] criminal investigations conducted before formal
accusation.” Id. at 249. In short, as this Court had observed even before the 1996
amendment to the statute, “[t]he history of Section 1782 reveals Congress’ wish to
strengthen the power of district courts to respond to requests for international
assistance.” Lo Ka Chun v. Lo To, 858 F.2d 1564, 1565 (11th Cir. 1988)
(emphasis added).
In its present form, section 1782 has four prima facie requirements that must
be met before a district court is authorized to grant an application for discovery
under the statute:
(1) the request must be made “by a foreign or international tribunal,”
or by “any interested person”; (2) the request must seek evidence,
whether it be the “testimony or statement” of a person or the
production of “a document or other thing”; (3) the evidence must be
“for use in a proceeding in a foreign or international tribunal”; and (4)
the person from whom discovery is sought must reside or be found in
the district of the district court ruling on the application for assistance.
In re Clerici, 481 F.3d at 1331-32 (footnote omitted) (quoting 28 U.S.C. §
1782(a)). JASE does not dispute that requirements (1), (2), and (4) have been met
here. As a party to the dispute, CONECEL plainly is an “interested person”;
12
CONECEL’s application seeks evidence in the form of document production and
deposition testimony; and the application seeks discovery from JAS USA, which
has an office and does business in Miami and is therefore “found in the district of
the district court ruling on the application for assistance” -- namely, the Southern
District of Florida.
The only requirement at issue is the third one -- that the evidence sought
must be for use in a proceeding in a foreign or international tribunal. JASE claims
that there is no such proceeding. CONECEL advances two independent theories
for why there is: that CONECEL wants the evidence for use in reasonably
contemplated civil collusion proceedings that it may file against two of its former
employees; and that the arbitration between the parties is a proceeding already
pending in a foreign tribunal. Because we agree that a proceeding exists under the
former theory, we need not address the latter. 4
4
We decline to answer this substantial question on the sparse record found in this case. The
district court made no factual findings about the arbitration and made no effort to determine
whether the arbitration proceeding in Ecuador amounted to a section 1782 tribunal. Two circuits
have held that private arbitral tribunals fall outside of the scope of section 1782. See Nat’l
Broad. Co. v. Bear Stearns & Co., 165 F.3d 184, 190 (2d Cir. 1999); accord Republic of
Kazakhstan v. Biedermann Int’l, 168 F.3d 880, 881 (5th Cir. 1999). However, since then, the
Supreme Court has decided Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 258
(2004), where it applied a functional analysis focusing on whether a body acts as a first-instance
adjudicative decision maker, permits the gathering and submission of evidence, has the authority
to determine liability and impose penalties, and issues decisions subject to judicial review. See
id. at 255 & n.9, 257-58. Moreover, in Intel the Court suggested in dicta that “[t]he term
‘tribunal’ . . . includes investigating magistrates, administrative and arbitral tribunals, and quasi-
judicial agencies, as well as conventional civil, commercial, criminal, and administrative courts.”
542 U.S. at 258 (alterations in original) (emphasis added) (quoting Hans Smit, International
13
CONECEL claims that it seeks the requested discovery for use in
contemplated civil and criminal proceedings in Ecuador against its former
employees. We agree that these contemplated proceedings satisfy section 1782. In
Intel, the Supreme Court explained that “Section 1782(a) does not limit the
provision of judicial assistance to ‘pending’ adjudicative proceedings. In 1964,
when Congress eliminated the requirement that a proceeding be ‘judicial,’
Congress also deleted the requirement that a proceeding be ‘pending.’” Intel, 542
U.S. at 258. Instead, the Supreme Court held that section 1782(a) requires only
that a proceeding “be within reasonable contemplation.” Id. at 259; accord In re
Letter of Request from the Crown Prosecution Serv. of the U.K., 870 F.2d 686,
691 (D.C. Cir. 1989) (Ginsburg, J.). The future proceedings must be more than
speculative, however, and a “district court must insist on reliable indications of the
likelihood that proceedings will be instituted within a reasonable time.” Crown
Prosecution Serv., 870 F.2d at 692; see also id. at 691 (describing the “decisive”
question as whether there was “sufficient indication that a proceeding in court
would eventuate in which the evidence gathered can be weighed impartially”).
CONECEL provided such reliable indications here. Its application
explained that, after an extensive internal audit, its auditors informed it that “there
Litigation Under the United States Code, 65 Colum. L. Rev. 1015, 1026 n.71 (1965)). Thus we
leave the resolution of the matter for another day.
14
are indications that [Egas] Ribadeneira and Narváez may be liable to CONECEL”
in connection with their “processing and approval of JAS Ecuador’s invoices
during the relevant period.” The memorandum of law accompanying the
application similarly explained that “an internal investigation and audit by
CONECEL pertaining to JAS Ecuador’s invoicing revealed that Ribadeneira and
Narváez, both former employees, may have acted in concert with others in the
processing of JAS Ecuador’s invoices, resulting in over-payment by, and monetary
losses to, CONECEL.” The sworn declaration of CONECEL’s Legal and
Compliance Director accompanying the application again stated that
“CONECEL’s internal auditors have also established possible indicia of liability
against two former executives of CONECEL, Lucy Egas Ribadeneira and
Germania Narváez, both based in Ecuador, and who once held the position of
Purchasing Manager at CONECEL and were responsible for approving the
invoices issued by JAS Ecuador.” According to the declaration, CONECEL
contemplates bringing a civil action in the court of competent jurisdiction in Quito,
Ecuador. The declaration further explained that Ecuador, like other civil law
countries, has laws providing that if successful in this civil action, CONECEL is
entitled to pursue a private criminal action against the perpetrators.
JASE contends that this proffer was insufficient to establish a reasonably
contemplated foreign proceeding, but the district court committed no error in
15
crediting CONECEL’s detailed explanation of its intent to pursue civil and
possibly subsequent criminal proceedings against its former employees for
collusion. In response to JASE’s argument that CONECEL’s failure to bring an
action thus far demonstrates that any civil or criminal proceeding is not within
reasonable contemplation, CONECEL points out that under Ecuadorian law, it
must submit its evidence with the pleading at the time it commences the civil
action. The Supreme Court in Intel noted that “[i]n civil law countries,
documentary evidence is generally submitted as an attachment to the pleadings or
as part of a report by an expert.” 542 U.S. at 262 n.14 (quoting Hans Smit, Recent
Developments in International Litigation, 35 S. Tex. L. Rev. 215, 235-36 n.94
(1994)). Thus, CONECEL claims that it has not yet brought any action against its
former employees because it is still waiting for the evidence it seeks pursuant to
the instant discovery application.
In light of CONECEL’s facially legitimate and detailed explanation of its
ongoing investigation, its intent to commence a civil action against its former
employees, and the valid reasons for CONECEL to obtain the requested discovery
under the instant section 1782 application before commencing suit, we can discern
no error in the district court’s determination that CONECEL’s foreign civil
proceedings against Egas and Narváez were “within reasonable contemplation.”
16
In short, CONECEL’s application satisfied the prima facie requirements of
28 U.S.C. § 1782(a).
B.
Our inquiry does not end with the statutory requirements. The law is clear
that “a district court is not required to grant a § 1782(a) discovery application
simply because it has the authority to do so.” Intel, 542 U.S. at 264 (citing United
Kingdom, 238 F.3d at 1319). Thus, JASE argues that, even if the statutory
requirements have been met, the district court abused its discretion in granting
CONECEL’s application anyway.
“Whether, and to what extent, to honor a request for assistance pursuant to
§ 1782 has been committed by Congress to the sound discretion of the district
court,” and “this court may overturn the district court’s decision only for abuse of
discretion.” United Kingdom, 238 F.3d at 1318-19. We have made clear that
“[t]his deferential standard is identical to that used in reviewing the district court’s
ordinary discovery rulings.” Id. at 1319; cf. Harris v. Chapman, 97 F.3d 499, 506
(11th Cir. 1996) (“District judges are accorded wide discretion in ruling upon
discovery motions, and appellate review is accordingly deferential.”).
Interpreting the Supreme Court’s decision in Intel, a panel of this Court
already has spelled out four factors that should be considered by the district court
in exercising its discretion:
17
Once the prima facie requirements are satisfied, the Supreme Court in
Intel noted these factors to be considered in exercising the discretion
granted under § 1782(a): (1) whether “the person from whom
discovery is sought is a participant in the foreign proceeding,”
because “the need for § 1782(a) aid generally is not as apparent as it
ordinarily is when evidence is sought from a nonparticipant”; (2) “the
nature of the foreign tribunal, the character of the proceedings
underway abroad, and the receptivity of the foreign government or the
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 request is otherwise
“unduly intrusive or burdensome.” The Supreme Court in Intel added
that “unduly intrusive or burdensome requests may be rejected or
trimmed.”
In re Clerici, 481 F.3d at 1334 (citation omitted) (quoting Intel, 542 U.S. at 264-
65). JASE’s argument that the district court abused its discretion only focuses on
the fourth factor. JASE claims that CONECEL’s request for discovery from JAS
USA is overbroad and improperly seeks confidential and proprietary information
related to how both JAS USA and JASE price their services.
The main problem with JASE’s claim is that it fails to provide us with any
sound basis for overturning the district court’s exercise of discretion or for
upending the district court’s determination that the discovery request was narrowly
tailored. This Circuit has held that once the section 1782 factors are met and the
district court is therefore authorized to grant the application, “the federal discovery
rules, Fed. R. Civ. P. 26-36, contain the relevant practices and procedures for the
taking of testimony and the production of documents.” Weber v. Finker, 554 F.3d
18
1379, 1384-85 (11th Cir. 2009) (quoting In re Clerici, 481 F.3d at 1336). As we
explained in Weber:
Section 1782 does not require that every document discovered be
actually used in the foreign proceeding. Quite the opposite. Section
1782 expressly provides that the district court should grant discovery
under the Federal Rules of Civil Procedure. Pursuant to Rule 26(b)(1)
of the Federal Rules of Civil Procedure, “[p]arties may obtain
discovery regarding any nonprivileged matter that is relevant to any
party’s claim or defense -- including the existence, description, nature,
custody, condition, and location of any documents . . . .” Fed. R. Civ.
P. 26(b)(1).
Id. at 1385.
We find unpersuasive JASE’s unsubstantiated claim that JAS USA’s
compliance with the subpoena would require the disclosure of confidential pricing
information that would harm its competitiveness in the marketplace. On its face,
CONECEL’s application does not seek general price information from JASE or
JAS USA or information about how JASE or JAS USA bills any other clients
besides CONECEL. Rather, every request in the application that bears on pricing
information uses language limiting the request to information relating directly to
CONECEL, such as “the rates charged or to be charged to CONECEL,” or
“services provided by JAS Ecuador or its affiliates to CONECEL,” or “billing or
invoicing to CONECEL,” or “services rendered . . . in connection with shipments
to CONECEL.” The district court did not abuse its discretion in concluding that
19
the subpoena requests information that “relates directly to the contract at issue”
and was “narrowly tailored.”
Moreover, JASE does not appear to have taken any steps to meet
CONECEL somewhere in the middle or to narrow the discovery request in any
particular way; rather, it has taken an all-or-nothing approach seeking to remove
JAS USA from the burden of having to produce any documents or deposition
testimony, even those that seem unambiguously relevant. We have previously
recognized that such an approach is problematic:
Finally, as to the fourth Intel factor -- whether the § 1782 request is
unduly intrusive -- the district court’s order granting the § 1782
application specifically indicated that if Clerici wished to pursue his
“unduly intrusive” argument, Clerici should file a motion to limit
discovery. Clerici never did so and instead chose to appeal the grant
of any discovery whatsoever. On appeal, as in the district court,
Clerici does not identify the terms of the written request that are
overly broad or assert how the scope of the request should be
narrowed. Thus, we, like the district court, have no occasion to
address the scope of the Panamanian Court’s discovery request.
In re Clerici, 481 F.3d at 1335. 5
The Seventh Circuit has raised similar concerns about all-or-nothing
discovery challenges in the course of reversing a district court’s complete denial of
a section 1782 application as an abuse of discretion:
5
Although the district court in this case did not expressly invite subsequent motions to limit
discovery, the basic concern raised by the panel in In re Clerici remains: it is a tall order indeed
for a party resisting a section 1782 application to establish on appeal that the district court abused
its broad discretion in granting any discovery at all.
20
Heraeus’s discovery demands are broad . . . . For all we know, they
are too broad. But if so, it doesn’t follow that Heraeus is not entitled
to any discovery. It’s not as if its demands were frivolous; it
obviously needs a good deal of discovery in order to prepare its case
against Biomet. If it’s asking for too much, the district court can and
should cut down its request, but not to nothing, as it did. That was
unreasonable, and therefore reversible.
Heraeus Kulzer, GmbH v. Biomet, Inc., 633 F.3d 591, 597-98 (7th Cir. 2011); see
also id. at 598 (noting that the district court’s denial of any discovery “was all the
more unreasonable because Biomet had refused to meet with Heraeus to negotiate
a reduction in the amount of discovery sought” and because of Biomet’s “refusal to
present any evidence of the burdens that granting Heraeus’s discovery request
would impose”). These concerns are persuasive. In this case, JASE has failed to
identify which particular discovery requests in CONECEL’s application are unduly
burdensome or to provide any specific evidence to support its blanket claim that
JAS USA should be exempted from having to comply with any and all discovery
obligations due to overarching concerns about confidentiality that are stated only at
the highest order of abstraction.
Finally, JASE suggests that the district court erred because its order denying
the motion to vacate did not contain a sufficiently detailed analysis of JASE’s
arguments about confidential price information. This argument too is without
merit. The district court considered the motions and pertinent parts of the record,
correctly identified the four Intel factors that guide the exercise of its discretion,
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correctly observed that JASE objected to the production of purportedly
confidential pricing information, and then made the determination that it
“disagree[d]” with JASE’s confidentiality claim and further found “the Subpoena
narrowly tailored and not unduly intrusive or burdensome.” We can discern no
abuse of discretion in any of these findings.
C.
JASE’s final claim is that the district court erred in denying its motion for
reconsideration under Fed. R. Civ. P. 59 and 60. 6 Although not a model of clarity,
JASE’s motion, beyond merely reiterating JASE’s previously raised claims,
appeared to seek relief in large part under Fed. R. Civ. P. 60(b)(2), which permits
relief from a final judgment, order, or proceeding based on “newly discovered
evidence.” In this Circuit, we employ a five-part test that a movant must meet in
order to be entitled to such relief:
(1) the evidence must be newly discovered since the trial [or final
judgment or order]; (2) due diligence on the part of the movant to
discover the new evidence must be shown; (3) the evidence must not
be merely cumulative or impeaching; (4) the evidence must be
material; and (5) the evidence must be such that a new trial [or
6
No one disputes that Rules 59 and 60 are appropriate vehicles to seek reconsideration of a
district court’s order denying a motion to vacate, because the order denying the motion to vacate
is final and leaves nothing further pending before the district court, much like any other form of
final judgment. Cf. Heraeus Kulzer, 633 F.3d at 593 (holding that a district court order denying
a section 1782 application was final and appealable because “[t]he court is finished with the
matter -- as the only matter is discovery -- and when no further proceedings are contemplated,
the court’s last order, even if it is a discovery order, is an appealable final order.”).
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reconsideration of the final judgment or order] would probably
produce a new result.
Waddell v. Hendry Cnty. Sheriff’s Office, 329 F.3d 1300, 1309 (11th Cir. 2003)
(citing Toole v. Baxter Healthcare Corp., 235 F.3d 1307, 1316 (11th Cir. 2000)).
The newly discovered evidence that JASE brought to the district court’s
attention was an April 2011 action filed in Ecuador by Egas, one of the two former
CONECEL employees discussed in the section 1782 application. Egas’s suit seeks
damages from CONECEL for slander based on CONECEL’s allegations of her
wrongdoing in this section 1782 application. JASE met the first three factors of
the Waddell analysis because the evidence was new, discovered with due
diligence, and not cumulative. The district court order denying JASE’s initial
motion to vacate the order granting the section 1782 application was issued in
April 2011, the same month that Egas commenced her lawsuit in Ecuador. JASE
promptly brought the new evidence to the attention of the district court by filing a
timely motion for reconsideration in May 2011.
But JASE’s evidence falls short under the fourth and fifth Waddell factors.
JASE claims that Egas’s suit establishes that any potential civil action by
CONECEL against its former employees would be baseless and without merit,
thereby confirming that there were no reasonably contemplated proceedings and
that CONECEL’s section 1782 application was merely a fishing expedition
designed to harass JASE and JAS USA. But we cannot simply assume that the
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allegations in Egas’s lawsuit are true and the allegations in CONECEL’s section
1782 application are false. Like the district court, we are in no position to assess
the merits of either CONECEL’s potential suit against Egas or Egas’s retaliatory
suit for slander.
In short, JASE’s newly discovered evidence proffered in its motion for
reconsideration was not material evidence nor evidence that would have probably
changed the outcome of the district court’s decision. See Waddell, 329 F.3d at
1309. Indeed, the bulk of JASE’s motion for reconsideration just reiterated
JASE’s already-rejected arguments. The district court, therefore, acted entirely
within its sound discretion in denying JASE’s motion for reconsideration. See
Richardson, 598 F.3d at 740 (“A motion for reconsideration cannot be used ‘to
relitigate old matters, raise argument or present evidence that could have been
raised prior to the entry of judgment.’” (quoting Michael Linet, Inc. v. Vill. of
Wellington, 408 F.3d 757, 763 (11th Cir. 2005))).
The district court’s denial of JASE’s motion to vacate the order granting
CONECEL’s 28 U.S.C. § 1782 application and the denial of JASE’s motion for
reconsideration are AFFIRMED.
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