Gary Born on In re Caratube

In my post on arbitral tribunals as “tribunals” under the judicial assistance statue, I raised the following objection to the cases holding that an arbitral tribunal is a “tribunal” for purposes of the statute: why should a party to an international arbitration, who is plainly an “interested party” under the judicial assistance statute, have the ability to invoke US pretrial discovery, when a party to a US domestic arbitration has that power only if the arbitrator first issues a subpoena? Discovery is broader in the US than anywhere else in the world, and our style of discovery is disfavored in many countries, so how could Congress reasonably have intended to subject parties to foreign arbitrations to the rigors of discovery but not parties to domestic arbitrations? Surely this is a reason to conclude that the statute should not treat arbitral tribunals as “tribunals”, and thus that international arbitration (or at least private international arbitration) should be categorically excluded from the reach of the statute.

Gary Born has an interesting post at the Kluwer Arbitration Blog about In re Caratube, 730 F.Supp.2d 101 (D.D.C. 2010), which provides a different answer to the problem. Rather than focus on the scope of the judicial assistance statute, the court focused on the control the arbitral tribunal can have over the parties’ access to discovery in the US. In Caratube, the parties had agreed that discovery would proceed under the International Bar Association Rules on the Taking of Evidence in International Commercial Arbitration. Those rules require a party seeking to take third-party documentary discovery to ask the tribunal to take steps to obtain the documents at issue. In light of the parties’ agreement, the court refused the application for leave to take discovery, on the grounds that the applicant had, as Born writes, “unilaterally ‘side-stepped’ procedural guidelines to which it agreed in the arbitration and thus “undermined the Tribunal’s control over the discovery process.”

If arbitral tribunals are empowered to control the parties’ access to the mechanisms of US discovery, then there is less of a rationale to construe the statute restrictively. I think it remains to be seen how, in light of Caratube, this issue will play out.

4 responses to “Gary Born on In re Caratube”

  1. […] discovery when we do not do so for parties in domestic arbitrations (but note that Gary Born proposes another solution to the […]

  2. […] was precisely to keep the floodgates closed, or mostly closed. I made this point in my post on Gary Born’s take on In re […]

  3. […] is really aimed at the correct construction of Art. 3.9 in private arbitrations). As I wrote in my post on Gary Born’s take on In re Caratube and in an earlier post on arbitral tribunals as “tribunals” for purposes of 28 U.S.C. […]

  4. […] is one of the factors relevant to a US court’s Intel analysis, and because, as Gary Born points out, the tribunal can act as a gatekeeper, the second of these reasons is relatively weak. The first […]

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