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In re Application of Wei

United States District Court, D. Delaware

October 23, 2018

In the Matter of the Application of ANTONIO WEI for an Seeking Discovery Under 28U.S.C. § 1782.

          Richard L. Renck and Oderah C. Nwaeze, DUANE MORRIS LLP, Wilmington, DE; Evangelos Michailidis, DUANE MORRIS LLP, New York, NY, attorneys for Applicant.

          Patricia R. Urban, PINCKNEY, WEIDINGER, URBAN, & JOYCE LLC, Greenville, DE; Janet Kljyan, NEUFELD, O'LEARY & GIUSTO, New York, NY, attorneys for Hacienda Intercontinental Realty, Inc.

          MEMORANDUM OPINION

          ANDREWS, U.S. DISTRICT JUDGE

         Pending before the Court is Respondent Hacienda Intercontinental's Motion to Quash Subpoena. (D.I. 12). The parties have fully briefed the issues. (D.I. 13; D.I. 14; D.I. 17). For the following reasons, the Court will grant Respondent's Motion to Quash Subpoena.

         I. Background

         Applicant Antonio Wei ("Applicant") filed an Ex Parte Application pursuant to 28 U.S.C. § 1782 on April 16, 2018 seeking discovery for use in a foreign legal proceeding against his brother, Peter Wei. (D.I. 1). At the time of his application, Applicant stated that he intended "to file an action against Mr. Wei in Brazil in connection with his alleged misconduct in connection with the sale of an ownership interest in the John Street Building." (D.I. 2 at 9). Applicant sought discovery from Respondent Hacienda Intercontinental ("Respondent"), a company which owned the John Street Building at the time of the challenged sale. (D.I. 2). The Court granted the application on April 26, 2018. (D.I. 4). Respondent filed a Motion to Quash Subpoena on August 8, 2018. (D.I. 12).

         II. Legal Standard

         "The district court of the district in which a person resides or is found may order him to give his testimony or statement or to produce a document or other thing for use in a proceeding in a foreign or international tribunal. .. . The order may be made . . . upon the application of any interested person." 28 U.S.C. § 1782(a). Accordingly, three statutory requirements must be met for this Court to have authority to compel discovery under § 1782(a): (1) the party from whom discovery is sought must reside or be found in the district; (2) the discovery must be for use in a proceeding before a foreign tribunal; and (3) the application must be made by an interested person. Id; see also Schmitz v. Bernstein Liebhard & Lifshitz, LLP, 376 F.3d 79, 83 (2d Cir. 2004).

         If a district court has the authority to compel the production of evidence under § 1782(a), whether to do so becomes a matter of discretion. Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 264 (2004). Factors that inform this discretion are: (1) whether the person from whom discovery is sought is a participant in the foreign proceeding; (2) the nature of the foreign tribunal, the character of the foreign proceedings, and the receptivity of the foreign government to federal judicial assistance; (3) whether the request conceals an attempt to circumvent foreign proof-gathering restrictions or other policies; and (4) whether the request is unduly intrusive or burdensome. Id. at 264-65. Courts must also bear in mind the twin aims of § 1782(a): "providing efficient assistance to participants in international litigation and encouraging foreign countries by example to provide similar assistance to our courts." Id. at 252.

         III. Discussion

          Respondent asserts that the grant of a subpoena under § 1782 is improper for three reasons: (1) the subpoena is invalid because it was served after the time period set out in the Court's order (D.I. 4); (2) the subpoena fails to meet the statutory requirements; and (3) two of the four Intel factors weigh in favor of quashing the subpoena. (D.I. 13 at 6).

         The subpoena is not invalid. Though the subpoena was served on Respondent roughly a week after the deadline in my order, Respondent had notice of the subpoena well within the covered time period. While it is Applicant's responsibility to ensure that it has properly served the correct party, Respondent has not alleged that any prejudice has arisen from the delay. Respondent has been able to file its objections to the subpoena, as evidenced by its motion to quash. Because no prejudice has been alleged and Respondent had notice before the deadline, I find the subpoena valid.

         However, the statutory requirements of § 1782 have not been met. Respondent asserts that Applicant is not an "interested person" and that the information sought is not "for use" in a foreign proceeding. (D.I. 13 at 6). There is not a foreign proceeding within reasonable contemplation. While a proceeding need not be pending, nor even imminent to permit grant of an application under § 1782, see Intel, 542 U.S. at 259, the applicant must show that a foreign proceeding is within "reasonable contemplation." In re Intel Corp. Microprocessor Antitrust Litig., 2008 WL 4861544, at * 11 (D. Del. Nov. 7, 2008). As Respondent recognizes, an applicant must provide "reliable indications of the likelihood that proceedings will be instituted within a reasonable time" for a proceeding to be within "reasonable contemplation." Id. at * 16. Retaining counsel and discussing the possibility of initiating litigation is not enough "to make an objective showing that the planned proceedings were within reasonable contemplation." Certain Funds, Accounts and/or Inv. Vehicles v. KPMG, LLP, 798 F.3d 113, 124 (2d Cir. 2015).

         Here, at the time Applicant filed his application, he stated that "he intends to file an action against Mr. Wei in Brazil in connection with his alleged misconduct in connection with the sale of an ownership interest in the John Street Building." (D.I. 2 at 9).[1] However, Applicant's own filings with ...


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