Case of the Day: Servotronics v. Rolls-Royce
Posted on October 6, 2020
The case of the day is Servotronics, Inc. v. Rolls-Royce PLC (7th Cir. 2020). I wrote about a related Fourth Circuit case earlier this year. The case deepens the circuit split on whether Section 1782 reaches private foreign arbitrations. The Fourth and Sixth Circuits have recently said “yes.” The Second and Fifth Circuits had said “no.” Now the Seventh Circuit has taken the Second Circuit view, setting up a very strong candidate for Supreme Court review (assuming the arbitration will still be pending a year from now).
In support of its view, the court looked to the statutory mandate of the Commission on International Rules of Judicial Procedure, which drafted the statute; the Commission’s work was
To the end that procedures necessary or incidental to the conduct and set-tlement of litigation in State and Federal courts and quasi-judicial agencies which involve the performance of acts in foreign territory, such as the service of judicial documents, the obtaining of evidence, and the proof of foreign law, may be more readily ascertainable, efficient, eco-nomical, and expeditious, and that the proce-dures of our State and Federal tribunals for the rendering of assistance to foreign courts and quasi-judicial agencies be similarly improved …
As the Seventh Circuit notes, there was no mention of arbitration. The court also reasoned that the phrase “foreign or international tribunal,” which appears in other statutes where it unambiguously does not refer to arbitration, should be read the same way in § 1782. The court also focused on avoiding a conflict with the FAA that I identified in one of the very first Letters Blogatory posts ever, nearly ten years ago: it is anomalous that parties to an international arbitration should have readier access to US discovery procedures than do parties in a domestic arbitration.
I have gone back and forth about this issue. Subject to mootness problems, I think there is a very good chance we will soon have a definitive answer on this question from the Supreme Court.