On March 22, 2021, the U.S. Supreme Court granted the petitioner’s request for Writ of Certiorari in the ServoTronics, Inc. v. Rolls-Royce, PLC case.[1]

The Servotronics case is actually a tale of two cases arising from the same arbitration. The supplier, Servotronics, supplied a valve to Rolls-Royce PLC (“Rolls-Royce”) in May 2015 that Rolls-Royce installed in an aircraft engine that it manufactured for The Boeing Company (“Boeing”). In January 2016, while testing the engine at Boeing’s plant in South Carolina, the engine caught fire, causing significant damage to Boeing’s aircraft. After Rolls-Royce settled Boeing’s claim for damages, it sought indemnification from Servotronics, contending that a malfunction of Servotronics’ valve caused the fire. On Servotronics’ rejection of the claim, Rolls-Royce commenced an arbitration proceeding in the United Kingdom, as required by the contract between the parties (“the Agreement”)[2].

In support of its defense, Servotronics sought discovery from witnesses at the Boeing plant in Charleston, South Carolina and for documents from Boeing headquarters in Chicago, Illinois. It filed applications for discovery under 28 U.S.C. §1782 (“Sec. 1782”) in both South Carolina and Illinois. The orders went up on appeal and the Fourth Circuit held that Sec. 1782 allowed the court to give assistance to the party in the foreign, private commercial arbitration, to assist the U.K tribunal. However, the Seventh Circuit held that Sec. 1782 only applies to governmental tribunals and not specifically to private commercial arbitration, based solely on the parties’ contractual rights.

These divergent interpretations of the term “Tribunal” exemplify the circuit court split in the U.S. on the discovery enforcement rule in Sec. 1782. The Fourth Circuit followed the Sixth Circuit case law and applied Sec. 1782 to the private international arbitration tribunal. The Ninth Circuit is likely to agree with the Fourth and the Sixth Circuits based on lower court decisions. However, the Second, Fifth and now the Seventh Circuit reject this interpretation and held that a private international commercial arbitration is not a foreign tribunal under Sec. 1782.

The Seventh Circuit Servotronics case was appealed to the U.S. Supreme Court via Writ of Certiorari. The U.S. Supreme Court’s acceptance of the appeal means that the table is set for the Court to hear or consider the arguments and set a standard applicable to all circuit courts. The ruling on this issue will affect all U.S. witnesses and companies in custody of evidence to be used in international arbitrations – as discovery is such an important tool in the strategy and presentation of a parties’ case and/or defenses, this ruling will have sweeping implications for international businesses including those in the aviation industry.

[1] Servotronics, Inc. v. Rolls-Royce PLC, No. 20-794, 2021 WL 1072280 (U.S. Mar. 22, 2021)

[2] Servotronics, Inc. v. Boeing Co., 954 F.3d 209, 210 (4th Cir. 2020)