US Court of Appeals backtracks from application of §1782 discovery in international commercial arbitration

By Harout Jack Samra

In a surprising reversal, the US Court of Appeals for the Eleventh Circuit has vacated its ruling in Consorcio Ecuatoriano de Telecomunicaciones SA v JAS Forwarding (USA) Inc, 685 F.3d 987 (11th Cir. 2012) (CONECEL I), in which it granted an application to obtain discovery for use in an Ecuadorian arbitration pursuant to 28 USC §1782. CONECEL I represented the first instance in which a US Court of Appeals endorsed the use of §1782 in connection with commercial arbitration proceedings.

Apparently unprompted by either of the parties, however, the circuit court chose to reconsider the issue in the very same case and issue a revised opinion some two years later. See Consorcio Ecuatoriano de Telecomunicaciones SA v JAS Forwarding (USA) Inc, No. 11-12897, 2014 WL 104132 (11th Cir. Jan. 10, 2014) (CONECEL II).

Although the court reached the same result, it did so on substantially narrower grounds and expressly withheld judgment on the question of whether an arbitral tribunal constituted a ‘foreign or international tribunal’ for purposes of the statute. Whereas the court in CONECEL I substantially advanced the cause of §1782’s application in arbitration proceedings — a matter of great controversy — its reversal in CONECEL II injects significant new uncertainty as to the statute’s scope…

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