Case of the Day: In re Hanwei Guo

Longtime readers know that one of the big open questions in Section 1782 practice is whether the statute reaches private international arbitrations. Is an arbitration of a typical business dispute a proceeding before a “foreign or international tribunal,” such that an interested person can seek discovery in the United States? The circuits are split, with the pre-Intel decisions (from the Second and Fifth Circuits) holding that the statute does not reach private arbitration, and the post-Intel decisions (from the Fourth and Sixth Circuits) holding that it does. In today’s case, In re Hanwei Guo (2d Cir. 2020), the Second Circuit adhered to its own precedent, setting the stage for a pretty compelling cert. petition in the coming year.

Why did the Second Circuit adopt this approach? The outcome was almost preordained. A panel can overrule an earlier panel decision if it finds that a Supreme Court decision rendered the earlier panel decision unsound. But while many have taken the Supreme Court’s discussion in Intel to support the use of § 1782 in private arbitration, the case was not about arbitration, and the Supreme Court’s dicta suggesting a functional approach to deciding what counts as a tribunal were just that—dicta. In most circuits there is at least some chance that the full court, sitting en banc, can overrule an earlier panel decision, but en banc review is essentially dead in the Second Circuit.

There was a second, very interesting issue in the case. Assuming that only public international arbitrations count, what about this arbitration, conducted under the auspices of CIETAC? CIETAC was founded by the Chinese government, but according to the court, it now functions “essentially independently of the Chinese government” and limits (just limits?) “opportunities for ex parte intervention by state officials.” There was no evidence that the Chinese government intervenes after awards, except on the kind of grounds that any court could use to vacate an award. So the court found no reason to treat CIETAC differently than other administering bodies. If the case gets to the Supreme Court, though, I expect that some amicus or other will want to delve into the nature of private arbitral tribunals, which are created by the consent of the parties just as a contract is created, but that, in a sense, live and move and have their being through the law.

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