Academic journal article Houston Journal of International Law

Obtaining Discovery Abroad: The Utility of the Comity Analysis in Determining Whether to Order Production of Documents Protected by Foreign Blocking Statutes

Academic journal article Houston Journal of International Law

Obtaining Discovery Abroad: The Utility of the Comity Analysis in Determining Whether to Order Production of Documents Protected by Foreign Blocking Statutes

Article excerpt

I. INTRODUCTION

The global economy is now a reality. With the increasing globalization and diversification of commerce and human interaction comes a concomitant globalization and diversification of legal proceedings. In this age of growing international economic interaction, discovery driven document production often involves corporations with offices overseas. Because of resistance to American style discovery in some foreign jurisdictions, attempts to obtain information essential to litigation are sometimes frustrated by foreign blocking statutes.(1) Blocking statutes, laws of foreign countries that impose criminal penalties upon parties within their jurisdiction who disclose specified documents, are so named because of their effect upon American style discovery.(2) The tension created by these statutes has led commentators to assert that no aspect of extending the U.S. legal system abroad has given rise to more friction than discovery of materials associated with investigation and litigation in the United States.(3)

Balancing the need for production of vital information with the possibility that its discovery orders will lead to criminal liability for the producing party, a U.S. court must determine whether to grant a motion compelling production.(4) Further, if the motion to compel production is not complied with, the court must decide whether to impose sanctions through Rule 37 of the Federal Rules of Civil Procedure.(5)

Gaining compliance with a production order can mean the difference between winning or losing a multi-million dollar verdict for one's client.(6) Partly because the stakes are so high, courts have had trouble agreeing on a uniform standard.(7) In Societe Internationale, the Supreme Court affirmed a district court's power to order a party to produce documents kept in a foreign country despite the fact that such production may subject the party to criminal sanctions in the foreign country.(8) Following this decision, courts have differed in their assessment of which factors to use in arriving at the decision to compel production.(9) Because issues of national sovereignty and respect for duly enacted legislation of foreign countries arise whenever U.S. courts attempt to compel discovery in foreign jurisdictions, it behooves U.S. courts to arrive at a consistent comity analysis when determining under what circumstances to compel.(10) This Comment suggests a consistent comity analysis to be applied to the determination of whether to compel production of documents when illegality is raised as an excuse. By so doing, this analysis addresses a significant question left open ever since the Societe Internationale decision in 1958.(11)

II. FOREIGN BLOCKING STATUTES

The foundational principles upon which civil law countries have developed render them ill suited for the American style discovery assault.(12) There, the discovery process is shepherded by the judge, who alone has power to investigate facts.(13) The civil law tradition rejects the idea that such a vital function should be placed within the purview of the parties themselves.(14)

Given this predisposition in some foreign forums, it should not be surprising that American style discovery is met with a less than enthusiastic reception abroad.(15) Even where the forum shares the U.S. adversarial judicial system, the natural instinct to protect one's own interests produces antipathy in some nations toward U.S. antitrust and securities regulations.(16) This antipathy is sometimes expressed in the form of legislation aimed at thwarting the efforts of U.S. courts to pursue their jurisdictional privileges through discovery in foreign forums.(17) Accordingly, the taking of otherwise available evidence may be impossible if that evidence is subject to the reach of a foreign blocking statute.(18)

III. THE ROLE OF THE HAGUE EVIDENCE CONVENTION

A. General Provisions

Before addressing the issue of whether to order production of documents subject to a foreign blocking statute, a U. …

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