Tag Archives | France

Case of the Day: Johns v. Van Brunt Motors

By on November 21, 2011 in Hague Service Convention

Workers in a Faurecia facilityThe case of the day is Johns v. Van Brunt Motors (N.Y. App. Div. 2011). Johns sued Faurecia S.A., a French corporation with offices in Nanterre, in the New York Supreme Court in Chemung County. Johns filed the summons and complaint with the court, but it served the defendant only with the summons and a notice. (New York is one of the states that does not require service of the complaint with the summons, a point familiar to me from Murphy Bros. v. Michetti Pipe Stringing, Inc., 526 U.S. 344 (1999), but which I’ve never really understood the sense of) moved for summary judgment on the grounds that the court lacked personal jurisdiction because Faurecia had not been properly served with process.

The court held that under New York law, where the plaintiff commenced the action by filing a summons and complaint, it is improper to serve only a summons and notice, but that there was no prejudice, as Faurecia had demanded and received a copy of the complaint. Therefore, the court affirmed the denial of the motion for summary judgment.

The court’s decision may be right, but it seems too cursory to me. The Convention applies whenever there is occasion, under the law of the forum, to transmit a judicial document abroad. It seems to me that the court is acknowledging that under New York law, the complaint was required to be served abroad. The court basically held that delivery of the complaint to Faurecia’s US lawyer cured any prejudice. But the court doesn’t consider whether lack of prejudice can excuse failure to comply with the treaty. Even if lack of prejudice excuses noncompliance as a matter of New York civil procedure, does it excuse noncompliance as a matter of the United States’s international obligations? I would like to see this fleshed out more.

I want to note the similarity of this case to the suggestion made by Chris Voltz under Pennsylvania law, which seems similar to New York law in relevant respects. Readers may want to have a look at my post on Chris’s suggestion.

Photo credit: Régions Démocrates 2010 (license)

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Case of the Day: In re Application of Thai-Lao Lignite (Thailand) Co.

By on November 3, 2011 in Judicial Assistance Statute

LigniteWe reported on Thai-Lao Lignite (Thailand) Co. v. Government of the Lao People’s Democratic Republic (S.D.N.Y. 2011) back in August. In the prior case, the court confirmed an arbitral award in favor of Thai-Lao Lignite against the government of Laos.

Today’s case of the day, In re Application of Thai-Lao Lignite (Thailand) Co. (D.D.C. 2011), arises out of the same arbitration. After obtaining the award, Thai-Lao obtained confirmation of the award in the Paris Court of First Instance, and the Paris court obliged. Under French law (according to Thai-Lao Lignite), after confirmation the prevailing party can take steps to freeze the other party’s assets if it fails to pay voluntarily, as Laos allegedly had.

Thai-Lao requested judicial assistance from the court in Washington to serve a subpoena on Électricité de France International in order to discover French assets owned by Laos. In particular, EDFI was the principal owner and operator of Nam Theun 2, a hydroelectric power plant in Laos, and that revenues generated by the plant—in which Laos has an interest—pass through French banks and are attachable under French law.

In its ex parte application, Thai-Lao gave a Washington address for EDFI. But in a twist, the judge refused to rule ex parte and ordered Thai-Lao to serve the application on EDFI. Thai-Lao was unable to make service at the Washington address and sought to amend its application to give an address in Maryland. This, of course, raises red flags, since the statute requires that the target of a judicial assistance request must either reside or be found in the district where the application is brought. Thai-Lao therefore also alleged that “EDFI has continuous and systematic contacts with this District that are tantamount to EDFI’s being ‘found’ in this district pursuant to Section 1782.” Again, though, Thai-Lao could not effect service on EDFI at the Maryland address, but instead ended up serving EDF, Inc., a US-based holding company. Thai-Lao was forced to argue that service on EDF should qualify as service on EDFI, on an alter ego theory, or that it should be permitted to amend its application again to name EDF as the respondent.

Judge Bates held that the application should be dismissed as to EDFI and EFI on the grounds that neither was found in the District of Columbia. He went on to note that even if he had found that the statutory requirements were satisfied, he would have denied the application on discretionary grounds because most of the documents sought were in France, not in the US.

What is most puzzling about Thai-Lao’s application, to me at least, is that as we saw in the prior post, Thai-Lao obtained confirmation of the arbitral award in New York. Thus it seems to me that Thai-Lao has access to discovery in aid of its judgment under Rule 69(a)(2) of the Federal Rules of Civil Procedure:

In aid of the judgment or execution, the judgment creditor or a successor in interest whose interest appears of record may obtain discovery from any person—including the judgment debtor—as provided in these rules or by the procedure of the state where the court is located.

It seems to me that under Rule 69, the judgment creditor is entitled to discovery about the assets of the judgment debtor even if those assets are not located in the United States. Assuming that’s so, why frame your request as a request for discovery in aid of the French post-judgment proceeding? For one thing, you’d avoid the need for obtaining court permission to issue the subpoena (although, of course, the target of the subpoena could move to quash later, just as in a § 1782 proceeding).

Photo credit: Public Domain Photos (license)

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Case of the Day: Strauss v. Credit Lyonnais

By on October 14, 2011 in Hague Evidence Convention

The case of the day, Strauss v. Credit Lyonnais, S.A. (E.D.N.Y. 2011), raises issues we have not previously considered. The plaintiffs were American victims of terrorist attacks carried out in Jerusalem by Hamas, and members of their family. They sued Credit Lyonnais under the Anti-Terrorism Act of 1992, alleging that the bank had provided material support to Hamas.

Today’s opinion involved the confidentiality of documents produced in discovery. The bank had previously produced documents containing financial information about one of its customers, the Comité de Bienfaisance et de Secours aux Palestiniens, which the US government designated as a “Specially Designated Global Terrorist” in 2003, and had designated the documents as “confidential” or “highly confidential”. In addition to bank account records, the documents included declarations that the bank had filed concerning CBSP with Traitement du renseignement et action contre les circuits financiers clandestins, part of the French Ministry of Finance that fights money laundering, and notes of an interview a bank official gave to a police commander in Nancy in connection with a preliminary investigation of CBSP.
There was no question about the propriety of the confidentiality designations for purposes of pre-trial discovery, but should the parties be able to file the documents with the court under seal in support of their motions for summary judgment? After all, there is a presumption of public access to court records that has both a common law and a constitutional dimension. On the other hand, French bank secrecy law prohibits disclosure of the documents that the plaintiffs obtained in discovery Both the the TRACFIN documents and the police interview were produced in discovery pursuant to a letter of request to the French authorities under the Hague Evidence Convention, and similar records would ordinarily be privileged or otherwise non-public under US law. The court therefore concluded that there was a compelling reason, based in part on considerations of comity, for permitting the documents to be filed under seal, or with the truly confidential portions of the documents redacted.

The judge’s decision is thoughtful and appropriately sensitive to comity concerns. It would be unfortunate indeed if a French defendant produced documents protected from disclosure by French law with the understanding that they would be treated confidentially, and then subjected to a “bait-and-switch” when the time comes for the documents to be submitted to the court. On the other hand, perhaps courts should not be so ready to assume, as a judge was in an earlier stage of this case, that a protective order aimed at protecting documents in pre-trial discovery provides a sufficient basis for ordering production of documents notwithstanding a foreign blocking statute or bank secrecy law.

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