Introduction
On March 1, 2023, the England and Wales Court of Appeal handed down its ruling in Soriano v. Forensic News LLC[1] which looked at the “proper approach to defendants who seek to use foreign court procedures to gather evidence to support their defence to litigation [in England and Wales].”[2]
In this case, the Anglo-Israeli Claimant sued two US-domiciled Defendants, claiming that they had libelled the Claimant in online publications.[3] The Defendants contested the jurisdiction of the English court, but the Court of Appeal held that the English court was “clearly the most suitable forum.”[4] The Defendants, nevertheless, made an application under 28 USC § 1782 (“the § 1782 application”) to the District Court of the Southern District of New York (“SDNY”) for an order requiring HSBC Bank USA to produce banking documents relating to the Claimant, to support their defence in the English court.
Upon finding out about the § 1782 application, the Claimant applied for an anti-suit injunction in the English court on the grounds that the § 1782 application was “vexatious, oppressive and unconscionable and would interfere with the efficient conduct of these proceedings.”[5]
The Claimant’s application for an anti-suit injunction was dismissed by Murray J in February 2023, holding that the Defendants were “not guilty of “conduct which [was] oppressive or vexatious or which [interfered] with the due process of the court,””[6] relying on the judgment of Lord Brandon in South Carolina Insurance Co v. Assurantie Maatschappij “De Zeven Provincien” NV [1987] 1 AC 24.[7]
The Claimant appealed.[8]
The § 1782 Application
28 USC § 1782 is a provision allowing a US court to provide assistance to an applicant seeking to gather evidence in relation to foreign legal proceedings. It states: “[t]he district court … may order [a person] to … produce a document or other thing for use in a proceeding in a foreign … tribunal.”[9]
The § 1782 application exists to assist a foreign court, thus a US court presented with such an application may “take into account the nature of the foreign tribunal, the character of the proceedings underway abroad, and the receptivity of the foreign … court … to US federal-court judicial assistance.” Further, a US court “should consider whether the [§ 1782 application] conceals an attempt to circumvent foreign proof-gathering restrictions.”[10]
An English court, in looking whether to restrain a § 1782 application will need to consider “all the circumstances” and the “purpose for which the § 1782 application is brought.”[11]
Judgment
The Court of Appeal assessed the Defendants’ § 1782 application and found that Murray J did not fall into error[12] and ultimately agreed with Murray J in finding that the § 1782 application was not “oppressive, vexatious, or otherwise unconscionable.”[13]
In reaching this conclusion, the Court looked at two cases in which an English court had restrained a § 1782 application on the grounds of it being abusive, unconscionable or vexatious[14] and recognised that a § 1782 application may, or may not, be abusive, depending on the reasons for which the § 1782 application is brought. The Court held that an assessment into whether a § 1782 application should be restrained is fact-specific, and that the judge must take into account all the circumstances of the case and whether the § 1782 application would “interfere with the proper conduct of [the] proceedings.”[15] In any event, the Court made clear that it would be “slow to interfere with such a factual assessment unless the judge has made a legal error,”[16] which, in this case, the judge had not.[17]
The Court of Appeal held:
“For the reasons that appear below, we have decided to dismiss the appeal. In the broadest outline, the principles applicable to a 1782 application made by a defendant to English proceedings were clearly stated in South Carolina, where Lord Brandon explained at page 40D that the court could grant an injunction restraining foreign proceedings where “one party to an action has behaved, or threatens to behave, in a manner which is unconscionable”. Lord Brandon did not, however, (at page 42) think that the defendants had so behaved, nor did he think that they had in any way departed from, or interfered with, the procedure of the English court “by seeking to exercise a right potentially available to them under the Federal law of the United States”. All they had done was “what any party preparing his case in the High Court here [was] entitled to do, namely to try to obtain in a foreign country, by means lawful in that country, documentary evidence which they believe that they need in order to prepare and present their case”. It seems to us that the judge was entitled to reach the same conclusion here. The principles applicable to libel proceedings in this context are no different from those applicable to other civil proceedings; of course, the burden of proving truth is on the defendant in a libel action, but that should not mean that the defendant is disabled from evidence gathering in any lawful manner. The apparently undesirable breadth of the order sought is a matter for the DCSDNY applying its own principles. It will, however, realise from this judgment that such a broad order would be unlikely to be granted here.”[18]
In sum, it is clear from this judgment that a person making a § 1782 application in the US courts to assist their English case may be permitted to do so as long as they do not act unconscionably, and they obtain evidence in a lawful manner that is open to them in a way that does not interfere with the procedures of the English courts. Acting in bad faith or in an attempt to circumvent the rules and procedures of the English courts, however, may likely see a § 1782 application restrained.
[1] Soriano v. Forensic News LLC & Ors [2023] EWCA Civ 223
[2] Ibid at 1
[3] Ibid at 2
[4] Ibid, referring to Soriano v. Forensic News LLC & Ors [2021] EWCA Civ 1952
[5] Ibid at 5
[6] Ibid at 6
[7] South Carolina Insurance Co v. Assurantie Maatschappij “De Zeven Provincien” NV [1987] 1 AC 24 per Lord Brandon at 41C-D
[8] The Claimant raised five grounds of appeal, He contended that the § 1782 application: (1) was an inherently abusive fishing expedition which sought to circumvent English disclosure rules; (2) involved abusive re-litigation in the SDNY of an issue already decided against the Defendants in relation to jurisdiction; (3)
[9] Op. Cit. n1 at 4, citing 28 USC § 1782
[10] Ibid at 25 citing Intel Corp v. Advanced Micro Devices, Inc., 542 U.S. 241 (2004) (per Justice Ruth Bader Ginsburg)
[11] Ibid at 22
[12] Ibid at 23
[13] Ibid at 28
[14] Ibid at 19; the two cases referred to by the Court were Bankers Trust International Plc v. PT Dharmsala Sakai Sejahtera [1996] CLC 252 and Omega Group Holdings v. Kozeny [2002] CLC 132.
[15] Ibid at 21
[16] Ibid
[17] Ibid at 23
[18] Ibid at 10
The Anglo-American Lawyer 