U.S. Supreme Court’s Decision on the Applicability of Section 1782 Discovery Likely to Have Practical Impact on Arbitration in Latin America

There are many open questions regarding how and when parties in Latin America-related arbitrations can obtain U.S.-based discovery following the United States Supreme Court’s much-anticipated decision regarding the application of the Section 1782 discovery statute to international arbitration in ZF Automotive US, Inc. v. Luxshare, Ltd. and AlixPartners, LLP v. Fund for Protection of Investors’ Rights in Foreign States.

The Court held unanimously that Section 1782 does not permit U.S. courts to order discovery for use in commercial arbitrations abroad but introduced substantial ambiguity with respect to whether Section 1782 can be used in investor-state cases.

This Alert Memorandum briefly summarizes the U.S. Supreme Court’s decision and then focuses on the practical impact that the decision is expected to have in arbitrations where the parties are from, or the proceedings are seated in, Latin America.