Case of the Day: Lantheus Medical Imaging v. Atomic Energy of Canada
Posted on June 26, 2012
In the underlying case, Lantheus Med. Imaging, Inc. v. Zurich Am. Ins. Co., pending in the Southern District of New York, Lantheus sued Zurich, its insurer, for failure to pay on a lost business income claim arising out of the shutdown of a nuclear reactor in Chalk River, Ontario. The shutdown of the reactor, according to Lantheus, caused a disruption in Lantheus’s supply of Molybdenum-99, a raw material Lantheus used to manufacture radiopharmaceutical products.
On Lantheus’s motion, the New York court had issued a letter rogatory to the Ontario court seeking testimony and documents from Atomic Energy of Canada Ltd. The Ontario court at first refused to execute the letter rogatory on the grounds that AECL was a Crown agent of the government of Canada and thus an agency or instrumentality of Canada immune from the jurisdiction of the United States courts under the FSIA. Under the Ontario Evidence Act, the court could give judicial assistance only if the US court was a court of competent jurisdiction, and in the Ontario court’s view, AECL’s immunity from suit in the US meant that the US court was not a court of competent jurisdiction. The Ontario court’s decision was without prejudice to a renewed request after the US court addressed the issue of FSIA immunity. I questioned the Ontario court’s reasoning on the grounds that a letter rogatory is not compulsory process but rather a request to the Ontario court to issue compulsory process, and that the US court’s jurisdiction over AECL was neither here nor there. If the US court had had jurisdiction over AECL, there would have been no need for a letter rogatory in the first place!
As I noted in my second post on the case, Lantheus sought issuance of an amended letter rogatory from the New York court, and AECL opposed the motion as an amicus curiae. The judge, correctly, ruled in favor of Lantheus. I summarized the rationale for the decision in my second post:
A subpoena is a command of the US court requiring the person to whom it is directed to appear at a certain place and testify, or to produce documents. A letter rogatory is a request to a foreign court that does not require anyone to do anything and is hardly an exercise of jurisdiction over a foreign sovereign that could run afoul of the FSIA.
In today’s decision, the case returns to Ontario. As far as it appears from the decision, the judge had accepted the US court’s view about its jurisdiction to issue a letter rogatory to the Canadian court aimed at discovery from AECL. So the questions in the case were purely questions of Canadian law. I don’t want to discuss the decision in detail, because it involves questions of Canadian law. In summary, though, the judge held that AECL was protected by Crown immunity and that in any event Lantheus had not satisfied all the ordinary prerequisties for enforcement of a letter rogatory.
I have two quick observations. First, the judge’s ruling on Crown immunity is similar both in form and in substance to the decision in Al Fayed v. CIA, 229 F.3d 272 (D.C. Cir. 2000), which I noted in my April 5, 2012 post on the Thai-Lao Lignite case. In both cases, the judges found that under ordinary rules of statutory interpretation, as prescribed in the US by the Dictionary Act, 1 U.S.C. § 1, and in Canada by § 17 of the Interpretation Act, statutes are presumed not to apply to the sovereign.1 And in both cases, the consequence was that the sovereign is not a proper target of a judicial assistance request.
Second, I have no reason to doubt the correctness of the Ontario judge’s decision that Lantheus’s argument failed because Lantheus had not shown “that the evidence … will be adduced at trial if it is admissible” or that the evidence “is not otherwise obtainable.” These limitations on the availability of pretrial discovery in Canada for use in US litigations are simply reminders of the United States’ status as an outlier on the question of pretrial discovery. It’s not clear that Canadian accession to the Hague Evidence Convention would change things, since parties to the Convention have the power to refuse to execute requests for pre-trial document discovery altogether.
Photo credit: Padraic Ryan
- In the US, the principle is that the word “person” in a statute does not apply to the sovereign unless expressly provided. In Canada, the principle is that “No enactment is binding on Her Majesty or affects Her Majesty or Her Majesty’s rights or prerogatives in any manner, except as mentioned or referred to in the enactment.”