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 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, 124 S.Ct. 2466, 159 L.Ed.2d 355 (2004), the anticipated proceedings were "within reasonable contemplation." Id. at 259, 124 S.Ct. 2466. 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.
CONECEL and JASE have had a lengthy contractual relationship that reaches back at least a decade.
CONECEL says that the agreements between the parties provided that CONECEL
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' agreedupon price.
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:
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.
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, 124 S.Ct. 2466. 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,
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:
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.
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 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 district court, we have no occasion to address any of these issues, which will likely be resolved in various tribunals in Ecuador.
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
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:
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"; 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
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, 124 S.Ct. 2466. Instead, the Supreme Court held that section 1782(a) requires only that a proceeding "be within reasonable contemplation." Id. at 259, 124 S.Ct. 2466; 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 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
JASE contends that this proffer was insufficient to establish a reasonably contemplated foreign proceeding, but the district court committed no error in 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, 124 S.Ct. 2466 (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."
In short, CONECEL's application satisfied the prima facie requirements of 28 U.S.C. § 1782(a).
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, 124 S.Ct. 2466 (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:
In re Clerici, 481 F.3d at 1334 (citation omitted) (quoting Intel, 542 U.S. at 264-65, 124 S.Ct. 2466). 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 1379, 1384-85 (11th Cir.2009) (quoting In re Clerici, 481 F.3d at 1336). As we explained in Weber:
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 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
In re Clerici, 481 F.3d at 1335.
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:
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, 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.
JASE's final claim is that the district court erred in denying its motion
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 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
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