United States: Return To Sender: Elvis Presley Enterprises All Shook Up Over Rejected Discovery In German Royalty Dispute

The Southern District of New York recently denied an application brought by Elvis Presley Enterprises LLC  ("EPE") for an order to take discovery pursuant to 28 U.S.C. § 1782, a provision of the United States Code that allows for discovery in aid of foreign litigation. See In re Elvis Presley Enters. LLC, No. 15mc386 (DLC) (S.D.N.Y. March 1, 2016).

The underlying lawsuit, brought by EPE in Munich, Germany, against Arista Music in December 2010, sought equitable relief, as well as information, relating to "grossly disproportionate" revenues purportedly earned by Arista Music through its exploitation of its rights in Elvis Presley's sound recordings. The court noted that "EPE's request for information in the German lawsuit was a substantive cause of action under German law" and not a "discovery request." Following dismissal of the initial action and a subsequent appeal, Arista Music was ordered to produce to EPE information that would allow EPE to calculate the value of its claim for equitable remuneration. That judgment became final in September 2013. Documents were not produced until July 2014, when EPE requested production of the documents subject to the September 2013 judgment. EPE contended that Arista Music's production was insufficient and inaccurate. Several months later, in December 2014, EPE resumed the underlying proceeding before the German court, but did not seek any relief from that court for Arista Music's purported failure to comply with the September 2013 order. A hearing was scheduled for December 16, 2015, at which the German court dismissed EPE's claim for equitable remuneration, but without discussion of the sufficiency of Arista Music's compliance with the September 2013 judgment.

On December 1, 2015, EPE filed an application for discovery under § 1782 against Arista Music's corporate parent, Sony Music Entertainment ("SME"), seeking broad discovery in aid of its German action against Arista Music. Title 28 U.S.C. § 1782, a powerful tool for persons seeking to obtain discovery in aid of foreign proceedings, provides, in relevant part:

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 pursuant to a letter rogatory issued, or request made, by a foreign or international tribunal or upon the application of any interested person and may direct that the testimony or statement be given, or the document or other thing be produced, before a person appointed by the court. . . . To the extent that the order does not prescribe otherwise, the testimony or statement shall be taken, and the document or other thing produced, in accordance with the Federal Rules of Civil Procedure.

Accordingly, there are three threshold requirements for a successful petition under Section 1782: (1) the person from whom discovery is sought must reside or be found in the district where the application is filed; (2) the discovery sought must be for use before a foreign tribunal; and (3) the application must be made by a foreign or international tribunal or any interested person. Once it determines that these threshold requirements are met, a district court may, in its discretion, order the requested discovery. The discretionary test applicable to § 1782 applications was announced by the Supreme Court in Intel Corp. v. Advanced Micro Devices, 542 U.S. 241 (2004). The eponymous "Intel factors" described by the Court include the following:

First, when the person from whom discovery is sought is a participant in the foreign proceeding, as Intel is here, the need for §1782(a) aid generally is not as apparent as it ordinarily is when evidence is sought from a nonparticipant in the matter arising abroad. A foreign tribunal has jurisdiction over those appearing before it, and can itself order them to produce evidence. In contrast, nonparticipants in foreign proceedings may be outside the foreign tribunal's jurisdictional reach; thus, their evidence, available in the United States, may be unobtainable absent §1782(a) aid.

Second, a court presented with a §1782(a) request may consider the nature of the foreign tribunal, the character of proceedings underway abroad, and the receptivity of the foreign government, court, or agency to federal-court judicial assistance.

Further, the grounds Intel urged for categorical limitations on §1782(a)'s scope may be relevant in determining whether a discovery order should be granted in a particular case. Specifically, a district court could consider whether the §1782(a) request conceals an attempt to circumvent foreign proof-gathering limits or other policies of a foreign country or the United States.

There was no dispute among the parties that the threshold factors were met. Assessing the first of the discretionary Intel factors, the district court found that EPE's request for discovery was within the scope of the substantive relief it sought, and was granted, before the German court. Rather than seek redress for what it claimed was incomplete and inaccurate production before the German court, which, significantly, was an option available to it, EPE chose instead to file the § 1782 application. Accordingly, the district court found that this factor weighed against EPE.

With respect to the second Intel factor, the nature and character of the foreign tribunal and proceedings, the district court was troubled by the fact that EPE only filed its § 1782 request on December 1, 2015—just two weeks before the substantive hearing—even though it had known of the hearing date since April 2015. Moreover, EPE's failure to raise Arista Music's allegedly deficient production before the German court, and the subsequent dismissal of EPE's claim by that court, further weighed against granting EPE's § 1782 application.

As far as the final factor is concerned, the district court did not find that EPE's § 1782 application sought to circumvent foreign law. Noting the Supreme Court's admonition that "nothing in the text of 1782 limits a district court's production-order authority to materials that could be discovered in the foreign jurisdiction if the materials were located there," this district court found this to be a neutral factor.

In addition to the Intel factors, the district court found the request to be unduly burdensome due, in part, to overbreadth, and noted that EPE had only belatedly agreed to narrow its discovery requests, despite being ordered by the court to meet and confer for that purpose.

Section 1782 remains a very powerful tool for obtaining discovery in aid of foreign litigation. This case, however, should serve as a warning that even though the statutory thresholds for a § 1782 application are easily met, U.S. courts will rigorously scrutinize the discretionary Intel factors.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.