U.S. Discovery in German Arbitrations and State Court Litigations After the U.S. Supreme Court’s Decision in “ZF Automotive US, Inc. v. Luxshare, Ltd.” and “AlixPartners, LLC v. Fund for Protection of Investors’ Rights in Foreign States”
June 27, 2022
Parties involved in disputes sometimes face the problem of not knowing certain aspects of the facts and not having access to potential evidence.
While parties may rely on document production in arbitration proceedings, in international arbitrations and state court litigation with a United States nexus the question has arisen whether evidence can be obtained by way of U. S. discovery under 28 U.S.C. § 1782 (“Section 1782”).
With its decision of June 13, 2022, the U.S. Supreme Court has now rejected the use of such discovery in support of private international commercial and certain investment arbitration proceedings. However, Section 1782 can still be used in state court litigation.
This Alert Memorandum first discusses the German legal framework for discovery and production of documents, and then discusses the potential impact of U. S. discovery in proceedings pending outside the United States. Subsequently, the Supreme Court’s decision is summarized and an overview of remaining options and strategic considerations for obtaining evidence is provided. Finally, the amendment to the German law executing the Hague Evidence Convention is discussed with regard to pre-trial discovery requests in support of U. S. proceedings.