Today’s DIScussion On ZF Automotive

I participated in a panel discussion today of the ZF Automotive case at the DIS, the German Arbitration Institute. It was a pleasure to get to exchange ideas with my colleagues on the panel, Derek Adler of Hughes Hubbard & Reed and Barbara Maucher of Noerr. I was assigned the role of explaining reasons why Section 1782 should be read to allow for discovery in aid of private international arbitration. That was, of course, a quixotic assignment in light of the ZF Automotive decision! Nevertheless, I persisted. Here were the considerations I presented (in a slightly different form than I put them during the talk–I’ve condensed four bullet points to two):

  • Comity. The Court asked how Section 1782 could promote comity if used in arbitration, since arbitration tribunals cannot provide reciprocal assistance, as foreign courts can. I think there are two responses to this. First, part of comity is providing assistance in the hope of getting assistance in return. But part of comity is also not giving offense to foreign states. Why should any foreign state, or any arbitral tribunal, take offense if the United States voluntarily undertakes to impose a burden on US companies for the benefit of the foreign state, the arbitral tribunal, or foreign parties to a dispute? If the concern is that the evidence obtained in the United States might overwhelm the tribunal, I think we can count on counsel to offer only the evidence that is material and pertinent to the case. And if the evidence is material and pertinent, why should anyone object to allowing a party the means to obtain it? Even the opponents of a broad Section 1782 don’t doubt the usefulness of evidence obtained in the US. Anyway, if a tribunal or a foreign state is really concerned about the use of evidence obtained via Section 1782, it can forbid the parties to use it, either by adoption of appropriate procedural rules, an order of the tribunal, or enactment of a statute. The parties themselves can foreclose resort to Section 1782 by agreement, either in the agreement to arbitrate or later. Second, I don’t think it’s accurate to say that it’s inconceivable that arbitral tribunals will not extend some kind of reciprocal help to US parties. The system of international arbitration has changed over time in a way that incorporates more American ideas about discovery than in the past. The IBA Rules are a good example of the way the system of international arbitration has tried to accommodate both American and European views. It’s true that an ad hoc arbitral tribunal can’t provide assistance to litigants in other cases, but that’s a very narrow view of the situation.
  • Interpretative Approach. Much of the Court’s decision was taken up with a textual analysis. The idea of a linguistic corpus analysis, though it didn’t find its way into the opinion, was discussed at argument and in the briefs. I suggested to the crowd, which I think was predominantly non-American, that textualism and originalism (though originalism didn’t feature in the opinion directly) have taken over the Supreme Court, but they are not necessarily the best way to read statutes (or the Constitution). Of course the text is important. But the Intel case provides a good example of how a court can grapple with the text, the legislative intent, and the purpose and context of the statute in order to divine its meaning. That’s the better way, and it’s the more traditional common-law way. If I may venture an observation that may be way-off base and that I didn’t offer at the panel discussion: reading the Constitution or a statute is like reading the Bible. There are some traditions, for example the Catholic tradition and the Jewish tradition, that read the text in light of a larger tradition. There are other traditions, for example, certainly strains of American Protestantism, that read the text hyper-literally and to some extent in a vacuum. On a Court that, at the time, had only Catholic and Jewish members (with Justice Breyer’s retirement and Justice Jackson’s arrival, the Court now has seven Catholic justices, one Jewish justice, and one Protestant justice), it is striking to see how the Court reads the text of a statute as a certain kind of fundamentalist might read the creation story in Genesis. Anyway, I am probably out over my skis with that observation.

One response to “Today’s DIScussion On ZF Automotive”

  1. Alexander Moskovits

    Quixotic by your own definition but it never hurts to extrapolate what should could be.

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