In re Application of Consorcio Ecuatoriano de Telecomunicaciones S.A,No. 11-12897 (11th Cir. Jan. 10, 2014) [click for opinion]

28 U.S.C. Section 1782 allows a party to a foreign legal proceeding to apply to an American court to obtain evidence for use in the foreign proceeding.  The dispute underlying this request for discovery under Section 1782 arose out of a foreign shipping contract billing dispute between Consorcio Ecuatoriano de Telecomunicaciones S.A. and Jet Air Service Equador S.A.  When Consorcio filed its application in the Southern District of Florida for discovery under Section 1782, it identified multiple "foreign proceedings" in Ecuador with respect to which it intended to use the evidence: a pending arbitration brought by Jet Air against Consorcio for non-payment under the contract and civil and private criminal suits Consorcio was contemplating bringing against former employees.

Under the Supreme Court's Intel decision, a proceeding need not be pending in order to justify a request for Section 1782 discovery; it is sufficient if the foreign proceedings are "reasonably contemplated."  The district court relied on the contemplated suits in Ecuador to justify the Section 1782 discovery.  On appeal of this decision in 2012, the Eleventh Circuit eschewed this reasoning.  Instead, the Eleventh Circuit held that the private arbitration then underway qualified as an "international tribunal" under Section 1782 and the discovery could be granted in aid of that foreign proceeding.  The issue of whether Section 1782 could be used in aid of international arbitration has been hotly contested since Intel and this decision was the only appellate decision to support the argument that 1782 could be used in aid of private, commercial arbitration.

But with its most recent decision, the Eleventh Circuit did an about-face. The court, sua sponte, issued a new decision to replace its 2012 decision.  In its new decision, the court adopted the district court's reasoning and held that the Section 1782 application was justified based on the suits Consorcio was contemplating bringing.  In footnote 4 of the decision, the court hinted that it might in the future hold that Section 1782 discovery is available in aid of arbitration.  But because of the "sparse" record on that issue, the Eleventh Circuit decided to " leave the resolution of the matter for another day."