Divorce Case Spanning Continents Spawns Discovery Sanctions For Company’s Failure To Produce Documents Physically Located Abroad

Carlton Fields
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[author: Thaddeus Ewald - Law Clerk]

The Eleventh Circuit affirmed a district court’s order compelling discovery and awarding contempt sanctions after a man refused to answer discovery requests and defied orders requiring production of documents in a divorce proceeding. After filing for divorce in Russia, the plaintiff sought discovery in countless courts across Europe and the Caribbean searching for documents she believed would reveal her husband’s secret ownership of assets in a Bahamian corporation. Plaintiff ultimately sought relief in federal district court in Georgia seeking discovery against an associated Atlanta corporation. A magistrate judge ordered the company to respond to the requests for production, but after an initial round of non-compliance and accompanying sanctions, it only produced twenty-three pages of documents.

The courts dealt extensively with the interpretation of 28 U.S.C. § 1782, which authorizes district courts to order discovery for use in a proceeding in a foreign tribunal upon satisfaction of certain requirements. The Eleventh Circuit addressed the first issue, defendant’s extraterritoriality argument that § 1782 does not reach documents located in foreign countries, and rejected it as a matter of first impression. It read the statute in conjunction with the Federal Rules of Civil Procedure to allow discovery of materials outside the United States so long as they are in the possession or control of the responding party. The Eleventh Circuit affirmed the district court’s broad interpretation of the “control requirement” to include situations where a company has the legal right to obtain documents requested and where the affiliated corporate entities have actually shared responsive information and documents in their normal course of business dealings. Finding sufficient circumstantial evidence that the Atlanta company had “control” over its Bahamian counterpart, the court affirmed and paved the way for the disclosure of documents the plaintiff had been searching for all over the world.

Sergeeva v. Tripleton Int’l Ltd., No. 15-13008 (11th Cir. Aug. 23, 2016).

 

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