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In re Application to Obtain Discovery for Use In Foreign Proceedings

United States Court of Appeals, Sixth Circuit

September 19, 2019

In Re: Application to Obtain Discovery for Use in Foreign Proceedings.
FedEx Corporation, Respondent-Appellee. Abdul Latif Jameel Transportation Company Limited, Movant-Appellant,

          Argued: August 8, 2019

         Appeal from the United States District Court for the Western District of Tennessee at Memphis. No. 2:18-mc-00021-Jon Phipps McCalla, District Judge.


          David Livshiz, FRESHFIELDS BRUCKHAUS DERINGER, U.S. LLP, New York, New York, for Appellant.

          Daniel T. French, FEDERAL EXPRESS CORPORATION, Memphis, Tennessee, for Appellee.

         ON BRIEF:

          David Livshiz, Linda H. Martin, Paige von Mehren, FRESHFIELDS BRUCKHAUS DERINGER, U.S. LLP, New York, New York, Shea Sisk Wellford, MARTIN, TATE, MORROW & MARSTON, P.C., Memphis, Tennessee, for Appellant.

          Daniel T. French, Colleen Hitch Wilson, FEDERAL EXPRESS CORPORATION, Memphis, Tennessee, for Appellee.

          Before: COLE, Chief Judge; GRIFFIN and BUSH, Circuit Judges.


          JOHN K. BUSH, Circuit Judge.

         Thomas Jefferson once counseled his nephew Peter Carr on how to think: "Fix reason firmly in her seat, and call to her tribunal every fact, every opinion."[1] This case calls upon us to do just that. We must decide whether Abdul Latif Jameel Transportation Company Limited ("ALJ"), a Saudi corporation, may rely on 28 U.S.C. § 1782(a) to discover facts from FedEx Corporation ("FedEx Corp."), a U.S.-based corporation, for use in a commercial arbitration pending in a foreign country. Under § 1782(a), a federal district court may order discovery "for use in a proceeding in a foreign or international tribunal" upon application by "any interested person." Jefferson used the word "tribunal" in a metaphorical sense to refer to the mind. We must decide whether Congress used the words "foreign or international tribunal" in a literal sense that includes the commercial arbitration involved here.

         In its § 1782(a) discovery application, ALJ sought a subpoena for documents from FedEx Corp. and deposition testimony of a corporate representative of that company. ALJ alleges that FedEx Corp. was involved in contract negotiations and performance of two contracts between ALJ and FedEx International Incorporated ("FedEx International"), a subsidiary of FedEx Corp. Each contract became the subject of a commercial arbitration, one pending in Dubai in the United Arab Emirates ("UAE"), the other brought in the Kingdom of Saudi Arabia. As explained below, we only address the availability of discovery for the Dubai arbitration because the arbitration in Saudi Arabia was dismissed, rendering moot ALJ's application as it pertains to this latter proceeding.

         The district court denied ALJ's application, holding that the phrase "foreign or international tribunal" in § 1782(a) did not encompass either of the two arbitrations. ALJ now appeals, arguing that the phrase "foreign or international tribunal" does include such proceedings and that ALJ's discovery request should be granted.

         The interpretive question is an issue of first impression in the Sixth Circuit, although the Supreme Court provided guidance for interpretation of § 1782(a) in Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004). Upon careful consideration of the statutory text, the meaning of that text based on common definitions and usage of the language at issue, as well as the statutory context and history of § 1782(a), we hold that this provision permits discovery for use in the private commercial arbitration at issue. Accordingly, we REVERSE the district court's denial of ALJ's application and REMAND for the district court to determine, in the first instance, whether the application should be granted under four discretionary factors the Supreme Court outlined in Intel to guide that determination.

         I. BACKGROUND

         A. The Dispute Between ALJ and FedEx International

         This dispute over statutory linguistics arises from supply-chain logistics. In 2014, after a period of negotiations, FedEx International entered a "General Service Provider" ("GSP") contract with ALJ. Under that contract (which was amended in 2015), ALJ agreed to be FedEx International's delivery-services partner in Saudi Arabia, where ALJ is incorporated. By agreement of the parties, disputes relating to the GSP were to be arbitrated in Dubai under the rules of the Dubai International Financial Centre-London Court of International Arbitration ("DIFC-LCIA").

         In 2016, FedEx International and ALJ entered another contract, the Domestic Service Agreement ("DSA"), under which FedEx International promised to provide ALJ with "certain support services." R. 3, PageID 38. Those parties also agreed to arbitrate disputes arising under the DSA in Saudi Arabia under the rules and laws of that country.

         After FedEx International and ALJ signed the GSP contract but before they entered the DSA, FedEx Corp.-the parent of FedEx International and appellee in this case-acquired TNT Express N.V. ("TNT"), a competitor in the delivery-services market in Saudi Arabia. According to ALJ, it did not become aware of the acquisition until it was already fait accompli.

         The parties disagree in part about the causes of the underlying dispute. ALJ suggests that FedEx Corp. was significantly involved in luring ALJ into a contractual relationship with FedEx International. ALJ also indicates that FedEx Corp. and FedEx International kept ALJ in the dark about the impending TNT acquisition. According to ALJ, when it learned of the TNT acquisition, FedEx Corp. and FedEx International misled ALJ to believe that the future of its contractual relationship with FedEx International was secure. ALJ contends that, for several weeks during the fall of 2017, FedEx International failed to provide ALJ with the support promised in the DSA. Then, "without warning," according to ALJ, FedEx International announced that it would not be renewing the GSP contract and that ALJ would have to bid against other potential contractors if it wanted to keep working with FedEx International. Appellant Br. at 10.

         FedEx Corp. responds that ALJ's brief overstates, and makes false assertions about, FedEx Corp.'s involvement in the negotiations and communications between FedEx International and ALJ. Additionally, FedEx Corp. disagrees that FedEx International was at fault in causing the ALJ-FedEx International rift. According to FedEx Corp., the trouble between ALJ and FedEx International started when ALJ began providing unsatisfactory service; FedEx International sought to work with ALJ but eventually gave up and decided to open up ALJ's position as FedEx International's general service partner in Saudi Arabia to bidding among various applicants.

         These factual disputes aside, ALJ and FedEx Corp. agree that attempts to reconcile soon broke down completely. On March 4, 2018, ALJ commenced arbitration against FedEx International (the "Saudi Arbitration") before a panel constituted under the rules and laws of Saudi Arabia, as provided in the DSA. A few weeks later, on March 21, FedEx International commenced arbitration against ALJ (the "DIFC-LCIA Arbitration") before a panel constituted under the rules of the DIFC-LCIA, as provided in the GSP contract.

         The DIFC-LCIA Arbitration panel consists of three members appointed by the DIFC-LCIA Arbitration Centre. According to FedEx Corp., the DIFC-LCIA Arbitration Centre is a joint venture of the London Court of International Arbitration and the DIFC Arbitration Institute.[2] The DIFC Arbitration Institute, in turn, was established by statute in the emirate of Dubai. Awards of the arbitral panel are reviewable by the DIFC Court, which was also established by statute in Dubai. The DIFC Court reviews arbitral awards for procedural soundness under the DIFC Arbitration Law, which was promulgated by the Dubai government. In addition, if a party challenges an award alleging inconsistency with UAE public policy, the award is reviewed under the law of the UAE. Aside from these review provisions, however, awards of the panel are binding on the parties. A merits hearing in the pending DIFC-LCIA Arbitration between ALJ and FedEx International is currently scheduled for November 3–9, 2019.

         As for the makeup and operations of the Saudi Arbitration panel, we do not go into details because on April 30, 2019 (shortly after ALJ filed this appeal), that panel issued an award dismissing ALJ's claims. ALJ has challenged the dismissal and is awaiting a decision. Below, in section II(A), we explain why the dismissal of the Saudi Arbitration has rendered moot the issues in this appeal as they pertain to that arbitration proceeding.

         B. Procedural History of ALJ's § 1782(a) Discovery Application

         On May 14, 2018, ALJ filed an application for discovery under 28 U.S.C. § 1782(a) against FedEx Corp. in the United States District Court for the Western District of Tennessee, the federal district where FedEx Corp. is headquartered. In the application, ALJ sought to compel production of documents from FedEx Corp. and to subpoena deposition testimony from a corporate representative of FedEx Corp. Although FedEx Corp. was not a party to either of ALJ's contracts with FedEx International, ALJ sought, among many other pieces of information:

1. All Documents and Communications concerning the negotiations of the Agreements between FedEx Corp. or FedEx International, on the one hand, and ALJ, on the other hand.
2. All Documents or Communications concerning or reflecting (i) any representations, assertions or assurances provided by FedEx Corp. or FedEx International, or any agent thereof, to ALJ, or any agent thereof, concerning the length of the Agreements, or FedEx Corp. or FedEx International's intent to enter into a long-term business relationship with ALJ; and (ii) all any [sic] knowledge or awareness on the part of FedEx Corp. or FedEx International of ALJ's need to make investments in connection with ALJ's agreed-upon provision of services to FedEx International.

R. 1-3, PageID 16.

         The district court held a hearing on ALJ's application on July 17, 2018, and it denied the application in an order dated March 13, 2019. In its order, the district court determined that neither the Saudi Arbitration panel nor the DIFC-LCIA Arbitration panel constituted a "foreign or international tribunal" within the meaning of § 1782(a). Therefore, the district court held that ALJ could not, as a matter of law, obtain discovery for use in those proceedings under § 1782(a). The district court did not consider whether it would have exercised its discretion to grant ALJ's application under § 1782(a) had it determined that either arbitration panel was a "foreign or international tribunal."

         ALJ timely filed a notice of appeal, and on April 12, 2019, it moved this court to expedite the appeal in light of the pending arbitration proceedings. On April 22, 2019, we ordered an expedited briefing and argument schedule.


         A. Whether the Saudi Arbitration Discovery Dispute is Justiciable

         Before turning to the statutory interpretation inquiry, we must address a justiciability issue with regard to the Saudi Arbitration. As noted, that proceeding has been dismissed, and ALJ is appealing the dismissal. FedEx Corp. argues that because the Saudi Arbitration is no longer pending, it "is irrelevant to ALJ's § 1782 motion." Appellee Br. at 9–10. Therefore, FedEx Corp. focuses its substantive arguments on the DIFC-LCIA Arbitration only.

         In response, ALJ argues that if we determine that the question regarding the Saudi Arbitration is moot and inappropriate for merits consideration, we should vacate the district court's denial of the § 1782(a) application with respect to that arbitration. ALJ worries that the Saudi Arbitration panel's dismissal may be reversed by a Saudi court and that if we do not bifurcate the district court's judgment and vacate as moot with respect to the Saudi Arbitration, the district court's reasoning as to that proceeding will stand and will preclude ALJ from bringing a future application.

         We agree that the dismissal of the Saudi Arbitration makes the interpretive question moot with respect to that arbitration. Therefore, it would be inappropriate for us to make a merits ruling on the question presented as it pertains to the Saudi Arbitration panel. See Church of Scientology of Cal. v. United States, 506 U.S. 9, 12 (1992). But ALJ's preclusion fears are unfounded. ALJ brought one § 1782(a) application in the district court, relying on both the DIFC-LCIA Arbitration and the Saudi Arbitration as "foreign or international tribunal[s]" that would trigger the statute's applicability. And the district court entered one judgment rejecting both of ALJ's proffered reasons for needing discovery. Our conclusion that the DIFC-LCIA Arbitration panel is a "foreign or international tribunal" is sufficient for us to reverse that judgment and require the district court to consider ALJ's application anew. Therefore, we need not address the Saudi Arbitration, but the district court's judgment will not remain in place, so that judgment will not preclude a future application should ALJ want to bring one. See Dodrill v. Ludt, 764 F.2d 442, 444 (6th Cir. 1985) (noting that "the general rule is that a judgment which is vacated, for whatever reason, is deprived of its conclusive effect as collateral estoppel" as to all of the issues litigated and decided in the action (emphasis added) (citations omitted)); see generally id. at 444–45 (discussing and applying the rule).

         B. Whether the DIFC-LCIA Arbitration Panel is a "Foreign or International Tribunal"

         We must now determine whether the DIFC-LCIA Arbitration panel qualifies as a § 1782(a) "foreign or international tribunal." Neither the phrase "foreign or international tribunal" nor the word "tribunal" is defined in the statute, and the parties dispute whether the word "tribunal" includes a privately contracted-for commercial arbitration. The district court concluded that it does not.

         We review the district court's decision on a question of statutory interpretation-a legal question-de novo. See United States v. Kassouf, 144 F.3d 952, 955 (6th Cir. 1998). "In determining the meaning of a statutory provision, we look first to its language, giving the words used their ordinary meaning." Artis v. District of Columbia, 138 S.Ct. 594, 603 (2018) (citation and internal quotation marks omitted). And ordinary meaning is to be determined retrospectively: we must go back to "the time Congress enacted the statute" and discern its meaning from that point in the past. See New Prime Inc. v. Oliveira, 139 S.Ct. 532, 539 (2019) (citations omitted); see also Wisc. Cent. Ltd. v. United States, 138 S.Ct. 2067, 2070 (2018).

         Thus, we can sometimes determine the ordinary meaning of words in a statute by reference to dictionaries in use at the time the statute was enacted. See Food Marketing Inst. v. Argus Leader Media, 139 S.Ct. 2356, 2363–64 (2019). Here, the relevant language was added to § 1782(a) by amendment in 1964, see Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 248–49 (2004), so we may consult dictionaries in use at that time. In addition, we may consult subsequently published dictionaries. See Antonin Scalia & Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 419 ("Scalia & Garner, Reading Law") ("Dictionaries tend to lag behind linguistic realities . . . ."). However, we use later-published dictionaries carefully and would hesitate to rely upon definitions appearing solely in dictionaries published more than a decade or so after the statute's enactment.

         We also may consider other evidence of usage in the years preceding the enactment: for example, the sense in which courts used a particular word or phrase. See New Prime, 139 S.Ct. at 540 (looking to early-20th-century cases' use of the term "contract of employment" as an aid to determining the meaning of that phrase in a 1925 statute); see also Argus Leader Media, 139 S.Ct. at 2363. As a respected treatise on statutory interpretation notes, the context of a statute's text includes "a ...

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