Amicus Curiae Brief — Intel Corp. v. Advanced Micro Devices, Inc

No. 02-572 OTEINE 07 TH

ne

In the Supreme Court of the Anited States

INTEL CORPORATION,

Petitioner,

V.

ADVANCED MICRO DEVICES, INC.,

Respondent.

On Writ of Certiorari to the United States

Court of Appeals for the Ninth Circuit

BRIEF OF THE CHAMBER OF COMMERCE OF

THE UNITED STATES AS AMICUS CURIAE

IN SUPPORT OF PETITIONERS

ROBIN S. CONRAD Roy T. ENGLERT, JR.*

National Chamber : MAX HUFFMAN

Litigation Center, Inc. Robbins, Russell, Englert,

1615 H Street, N.W. Orseck & Untereiner LLP

Washington, D.C. 20062 1801 K Street, N.W.

(202) 463-5337 Suite 41]

Washington, D.C. 20006

(202) 775-4500

* Counsel of Record

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TABLE OF CONTENTS

Se Ge HF REOEEED occ cccccceseseveseces

INTEREST OF THE AMICUS CURIAE ............

EEE Sateueecdcesébesenscecnedeceneus

A. The Statutory Scheme .......cccccccccces

B. The Proceedings Below and the

Ninth Circuit’s Decision .................

I. Judicial Assistance Under Section 1782 Is

Available to Litigants, to Persons

Otherwise Denominated “Interested Persons”

Under Applicable Foreign Law, and to the

Foreign or International Tribunal —

But Not to Respondent ..................

II. Section 1782 Permits Judicial Assistance

in Connection With A Proceeding in a

Foreign or International Tribunal — And Not

as Part of a Mere Investigation by

Law-Enforcement Authorities .............

Ill. Section 1782 Does Not Authorize

Circumvention of Foreign Tribunals’

Limitations on Discovery ................

EY bavedscensandivececcceecsveeves

ii

TABLE OF AUTHORITIES

Page(s)

Cases:

AKZO Chemie BV v. Commission,

1 CAGLR. 238 GB.CS. FORE oc cc cccsvennseepuens 7

Department of Revenue v. ACF Indus., Inc.,

SEO UB. SSS CED «oc ccncesasaueheneeee 12, 19

Egelhoff v. Egelhoff, 532 U.S. 141 (2001) ............ 1]

F. Hoffman-LaRoche, Ltd. v. Empagran S.A.,

No. 03-724, cert. granted Dec. 15,2003 ... 2,27, 28, 29

Fonseca v. Blumenthal,

vod w Br-fy fo o. 19

In re Application for an Order for Judicial

Assistance in a Foreign Proceeding,

147 F.R.D. 223 (C.D. Cal. 1993), overruled by

Advanced Micro Devices, Inc. v. Intel Corp.,

292 F.34 664 (Sth Civ. 2002)... ccccccccescccess 28

In re Application of Asta Medica, S.A.,

Jey i te 2. | eee 25, 27, 28

In re Application of National Broadcasting Co.,

No. M-77 (RWS),1998 WL 19994

(S.D.N.Y. Jam. 3i, GGG)... 0 0see0eeeeneee 25-26

In re Euromepa, 154 F.3d 24 (2d Cir. 1998) ........... 22

In re International Judicial Assistance for the

Federative Republic of Brazil Gen. Univ.

Trading Corp., 936 F.2d 702 (2d Cir. 1991) ....... 21

In re Ishihara Chemical Co.,

231 F.36 120 (26 Cie. BBB4) oc cccccscvenene 22

ili

In re Lancaster Factoring Co.,

90 F.3d 38 (2d Cir. 1996) .............55. 13, 15, 16

In re Letter Rogatory from the Justice Court,

523 F.2d 562 (6th Cir. 1975) ........ 0.0 cece eens 3

In re Letters Rogatory Issued by Dir. of

Inspection of the Gov't of India,

385 F.2d 1017 (2d Cir. 1967) ..............4.4.. 5, 16

In re Malev Hungarian Airlines,

964 F.2d 97 (2d Cir. 1992) ...........0055. 8, 15, 26

In re Request for Judicial Assistance from

Ministry of Legal Affairs of Trinidad &

Tobago, 848 F.2d 1151 (2d Cir. 1988) 11, 12, 22, 23, 25

International Tel. & Tel. Corp. v. international

Bhd. of Elec. Workers, 419 U.S. 428 (1975) ....... 17

Kolovrat v. Oregon, 366 U.S. 187 (1961) ............. 17

Lujan v. Defenders of Wildlife,

re 13-14

Morales v. Trans World Airlines, Inc.,

ELECT TT TTI TT 20

PBGC v. LTV Corp., 496 U.S. 633 (1990) ............ 15

Republic of Kazakhstan v. Biedermann Int'l,

168 F.3d 880 (Sth Cir. 1999) ............44.. 16, 24

Rodriguez v. United States,

480 U.S. 522 (1987) (per curiam) ................ 15

S&S Machinery Co. v. Masinexportimport,

706 F.2d 411 (2d Cir.), cert. denied,

ee ccecccccccccocccece 17

Shaw v. Delta Air Lines, Inc., 463 U.S. 85 (1983) ...... 20

iv

Société Nationale Industrielle Aérospatiale v.

U.S. District Court, 482 U.S. 522 (1987) ieeaeus 25, 26

Sorenson v. Secretary of Treasury,

— . * 5 a ere ree 12

Stork Amsterdam BV v. Commission,

5 C.M.L.R. 31 (Ct. of First Instance 2000) ......... 7-8

United Sav. Ass'n of Texas v. Timbers of

Inwood Forest Associates, Ltd.,

Ge SED vocendchacncuneenenesiaseus 23

United States v. Lopez, 514 U.S. 549 (1995) ........... 20

Warren v. Wasserman, Comden & Casselman,

271 Cal. Rptr. 579 (Cal. App. 1990).............. 14

Statutes, Regulations, and Rules:

is Oe nc canenasosnsecanéetseus 14

Foreign Trade Antitrust Improvements Act,

ae in subacececsesndcetheouuseesasues 28

Antitrust Civil Process Act,

Bp Geese Oe SOUS occcccccccsccaucns 7, 14,18

es ED db besutdiaendaceuencecannaue 18

ep es te Sn dc dddnetcccceutnecnenuecuees 14

PED Scuoucssdcutadincsecenuuueunen 23, 24

SP ET coecesdécndadesasaauedsuaanene 23

Ss ED 6ueenccctsdédecuseeennansuneneues 7

es Oe sn dadeddetsekeseunssseeenias 12

CDE COD ivvnccceccciigescocen 4, 12, 19, 20, 25

Fp es OF GED 0 cv ednccécvcecavescccesedees 4,12

Ps UUEE a nbececedeaccesacsosesscesoseneds 4

SO OED cecncecncesecscncesececececes passim

49 U.S.C. § 1305(a)(1) (now 49 U.S.C. § 41713(b)(1)) .. 20

Act of June 25, 1948, ch. 646, 62 Stat. 949 ............. 3

Act of May 24, 1949, ch. 139, § 93, 63 Stat. 103 ........ 3

Act of 1994, Pub. L. 103-488 ..............0006. 24

Pub. L. No. 104-106, Div. A, Title XII,

SEE GED becccccosuensecesedsccneseceass 5, 23

European Council Regulation 17/62 ................. 18

European Council Regulation 17/64 .................. 7

Pe LG cccecdneseceecusecenccccoeséeotes 14

Pee Ee UD occ cccccvccccccavesesecsesedsuenses 2

BD Ge Ge BO cencccccccccccccscenseusacesds 2,14

Pes Se GO Te GRD scwccccccnnccescveqescontes 14

Pa Ee GOR TRAD Sccccecccecscccéstedasieses 26

PRED ch6csdceccdcdeeseeceesescunet 14

Fed. R. Civ. P.27......... ssdasukariedmasaasiecee 26

PO GES cncccdsaduucedccusecesseoacecess 19

Ue Se GS I cccccccceccccecosecsscececeses 19

Miscellaneous:

Antitrust Contact Information, published at

http://www.ftc.gov/ftc/bccontact.htm .............. 7

Complaints from the Public on Competition Matters,

published at http://europa.eu.int/comm/

competition/citizen/citizen_complaints en.html .... 6-7

Corporate Leniency Policy, 4 Trade Reg.

Rep. (CCH) 4 13,113 (Aug. 10, 2003) ............ 26

Deputy Assistant Attorney General Makan

Delrahim, Department of Justice Perspectives

on International Antitrust Enforcement: Recent

Legal Developments and Policy Implications

(Nov. 18, 2003), available at http://www.usdoj.

gov/atr/public/speeches/201509.pdf ........... 27, 29

EU Imposes Almost €70 Million in Fines for

Organic Peroxide Cartel Over 29 Years,

Vol. 85 ISSN No. 2135 (Dec. 12, 2003) ......... 26-27

European Commission, Eleventh Report on

OED cddcecdcéccoccocccecse 17

European Commission Directorate-General

for Competition, XXX7st Report on Competition

Policy (2001), available at http://europ.

eu.int/comm/competition/annual_reports/2001/

competition_policy/eu.pdf .................... ;- 6

How to Report a Possible Violation, published at |

http://www.usdoj.gov/atr/contact/newcase.htm .....\. 7

http://www.fic.gov/ftc/bccontact.htm .............. oe | 7

http://www.usdoj.gov/atr/contact.html#cases ........... | 7

S. REP. NO. 88-1580, 88th Cong., 2d Sess.

(1964), reprinted in 1964 U.S.C.C.A.N. |

DUE ceveidceceuceceens 3, 4, 5, 9, 12, 13, 25, 2. 28

vii

S. REP. No. 103-388, 103d Cong., 2d Sess. (1994)

BRIEF OF AMICUS CURIAE CHAMBER OF

COMMERCE OF THE UNITED STATES IN

SUPPORT OF PETITIONERS

INTEREST OF THE AMICUS CURIAE'

The Chamber of Commerce of the United States, the

world’s largest business federation, is a nonprofit corporation

organized under the laws of the District of Columbia. The

Chamber represents an underlying membership of more than

three million companies and professional organizations of every

size, in every industry sector, and from every region of the

country. An important function of the Chamber is to represent

the interests of its members in matters before Congress, the

Executive Branch, and the courts. To that end, the Chamber

regularly files amicus curiae briefs in cases that raise issues of

vital concern to the Nation’s business community. The Cham-

ber is well situated to address the merits of this case on behalf

of companies collectively responsible for a substantial portion

of total U.S. economic activity.

The Chamber is particularly concerned about ihe growing

trend of private actors — including litigants, class-action counsel,

and complainants before foreign administrative authorities — to

engage in global forum shopping by attempting to export U.S.

laws and procedures worldwide. More troubling is that these

actors recently have been successful in making U.S. courts

complicit in this process, despite foreign countries’ protests. In

one case in which this Court recently granted certiorari, foreign

litigants and their counsel sued in U.S. courts, alleging antitrust

' Pursuant to Rule 37.3 of the Rules of this Court, the parties have

consented to the filing of this brief. The parties’ letters of consent

have been lodged with the Clerk of the Court. Pursuant to Rule 37.6

of the Rules of this Court, the Chamber states that no counsel for a

party has written this brief in whole or in part and that no person or

entity, other than the amicus curiae, its members, or its counsel, has

made a monetary contribution to the preparation or submission of this

brief.

2

injuries sustained outside of U.S. commerce. F. Hoffman-

LaRoche, Ltd. v. Empagran S.A., No. 03-724, cert. granted

Dec. 15, 2003. In Empagran, the D.C. Circuit held plaintiffs

entitled to U.S. laws and procedures, regardless whether U.S.

laws and procedures were different from, or even inimical to,

those of the jurisdiction where any harm may have occurred. In

this case, respondent has convinced the Ninth Circuit that it

might be entitled to discovery of documents and testimony from

petitioner, based on the existence of a mere preliminary

investigation by the European Commission. Respondent claims

such a statutory right whether or not (1) it is a litigant before a

foreign tribunal; (2) there is any adjudicative proceeding before

a foreign tribunal under way at all; and (3) the laws and pro-

cedures of the foreign jurisdiction allow the discovery respon-

dent seeks.

The Chamber believes that the decision below impermis-

sibly broadens the scope of discovery allowed to private parties

seeking information from their business rivals under 28 U.S.C.

§ 1782. The unreasonably permissive rules applied below oper-

ate any time that the company from which discovery is sought

is subject to the jurisdiction of any foreign sovereign’s courts or

regulatory bodies. Burdensome discovery requests are not

unique to these broad interpretations of Section 1782, but the

Ninth Circuit’s decision magnifies the burden. Under that deci-

sion, parties can obtain discovery without themselves bearing

any of the expenses of litigation and without being required to

surmount even the low hurdles of Federal Rules of Civil Pro-

cedure 8 and 11. Important disincentives to harassing and un-

warranted discovery requests are eliminated. If the Ninth Cir-

cuit’s ruling stands, a business can obtain broad discovery by

merely filing a complaint with a foreign enforcement agency.

The Ninth Circuit’s ruling allows competitors to seek this

discovery even if the relevant foreign nation does not allow it.

That circumvention of foreign discovery rules can place compa-

nies like members of the Chamber, which have a presence in the

United States, at a substantial disadvantage vis-a-vis their

3

foreign rivals. Rivals can inquire into competitively sensitive

information, under the imprimatur of a U.S. District Court, even

though the information is not needed by the foreign sovereign’s

court or administrative body.

The Ninth Circuit attributed to Congress an intent to impose

substantial burdens on U.S. businesses conducting business in

foreign countries. Members of the Chamber, many of which

conduct business abroad and are therefore subject to the juris-

diction of foreign sovereigns’ courts and administrative bodies,

have a substantial interest in the restoration of appropriate limits

on discovery under Section 1782.

STATEMENT

A. The Statutory Scheme

Section 1782 of Title 28 of the U.S. Code was enacted to

permit district courts to assist litigants in foreign adversary

proceedings to obtain discovery in the United States. Congress

enacted the modern Section 1782 in 1948 and amended the

section in significant part in 1964.7 The 1964 amendments were

part of a larger piece of legislation with the express purpose of

“providing equitable and efficacious procedures for the benefit

of tribunals and litigants involved in litigation with international

aspects.” S. REP. NO. 88-1580, 88th Cong., 2d Sess. (1964),

reprinted in 1964 U.S.C.C.A.N. 3782, 3783. The goal of the

changes was to “bring[] the United States to the forefront of

nations adjusting their procedures to those of sister nations * * *

[and] invite foreign countries similarly to adjust their

procedures.” Jbid.

2 Section 1782 actually is descended from a statute originally enacted in

1855. See Jn re Letter Rogatory from the Justice Court, 523 F.2d 562,

566-569 (6th Cir. 1975) (appendix detailing the history of judicial

assistance statutes). The statute was enacted in 1948 at its current place

in the U.S. Code. Act of June 25, 1948, ch. 646, 62 Stat. 949. In 1949,

Congress amended Section 1782 in pertinent part to replace the phrase

“civil action” with “judicial proceeding.” Act of May 24, 1949, ch. 139,

§ 93, 63 Stat. 103.

4

This legislation was forwarded to Congress in 1963 by the

Commission and Advisory Committee on International Rules of

Judicial Procedure. With the proposed legislation, the Commis-

sion included a May 27, 1963, letter by President John F.

Kennedy, expressing the administration’s view that the pro-

posed legislation “would be most desirable from the standpoint

of the administration of international justice on behalf of private

litigants.” Jd. at 3794. Walter Olney III, the Director of the Ad-

ministrative Office of the U.S. Courts, wrote to the Chairman of

the Senate Judiciary Committee in 1964, noting the approval of

the Judicial Conference of the United States. Director Olney

stated: “The procedures that would be presented by this legis-

lation * * * would alleviate some of the many procedural prob-

lems private litigants now face in prosecuting litigation with

international aspects.” Jbid.

The scheme adopted in 1964 to assist private litigants in-

cluded new statutory sections as well as amendments to pre-

existing sections, all of which have the same express purpose of

assisting with “litigation with international aspects.” Jd. at

3785. For example, Congress added 28 U.S.C. § 1696, which

provides for service of process in the United States in “litigation

with international aspects” (id. at 3784) pursuant to a letter

rogatory or request “by a foreign or international tribunal,” or

“upon application of any interested person.” 28 U.S.C.

§ 1696(a). Congress also amended 28 U.S.C. § 1781 (which

had been enacted in 1948 together with Section 1782), giving

the Department of State express authority to respond to letters

rogatory or requests “by foreign and international tribunais.”

1964 U.S.C.C.A.N. at 3787.

In the same legislation Congress amended Section 1782, to

“clanif[y] and liberalize[] existing U.S. procedures for assisting

foreign and international tribunals and litigants” and “adjust[]

those procedures [for obtaining evidence in the United States]

to the requirements of foreign practice and procedure.” Jd. at

3788. The Senate Report noted specifically the increasing use

of “investigating magistrates” and “the constant growth of ad-

5

ministrative and quasi-judicial proceedings all over the world”

as reasons for replacing the prior term “judicial proceeding”

with “proceeding in a foreign or international tribunal.” Jbid.

This change was made in part to ensure judicial assistance for

French juges d’instruction, which are factfinders roughly

equivalent to the grand jury in U.S. criminal practice. Jn re

Letters Rogatory Issued by Dir. of Inspection of the Gov't of

India, 385 F.2d 1017, 1020 (2d Cir. 1967) (Friendly, J.). The

Senate Report also described a purpose of the amendments as

clarifying who (in addition to the foreign or international

tribunal) was entitled to seek discovery under Section 1782: “an

interested person, such as a person designated by or under a

foreign law, or a party to the foreign or international litigation.”

1964 U.S.C.C.A.N. at 3789.

In 1996, Congress added a single phrase to indicate that “a

proceeding in a foreign or international tnbunal” includes

“criminal investigations conducted before formal accusation.”

Pub. L. No. 104-106, Div. A, Title XII, § 1342(b), 110 Stat.

496. In its current form (as amended in 1949, 1964, and 1996),

Section 1782 reads in pertinent part (emphasis added):

(a) The [U.S.] district court * * * may order [a person] 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, including criminal investigations

conducted before formal accusation. The order may be

made pursuant to a letter rogatory issued, or request made,

by a foreign or international tnbunal or upon the applica-

tion of any interested person * * *. The order may pre-

scribe the practice and procedure, which may be in whole

or part the practice and procedure of the foreign country or

the international tribunal, for taking the testimony or

statement or producing the document or other thing. 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.

6

Companies and individuals have sought the assistance of

U.S. courts in obtaining discovery on the theory that they are

“interested persons” even when they are not litigants or

otherwise authorized by foreign law to seek discovery; even

when there is no “proceeding in a foreign or international tri-

bunal” taking place; and even when foreign law does not permit

the discovery of the documents or testimony sought. Splits of

authority have developed over what constitutes a “proceeding

in a foreign or international tribunal” and over whether the

documents or testimony sought must be discoverable under the

law of the sovereign country where the proceeding is taking

place. This Court granted certiorari to resolve those splits and

other questions raised by petitioner and the Acting Solicitor

General.

B. The Proceedings Below and the Ninth Circuit’s

Decision

Respondent Advanced Micro Devices, Inc., is one of

petitioner Inte] Corporation’s primary competitors in the pro-

duction and sale of computer microchips. Respondent filed a

complaint with the European Commission Directorate General-

Competition (Directorate), one of more than 100 such com-

plaints the Commission receives yearly. European Commission

Directorate-General for Competition, XXX/Jst Report on

Competition Policy 11, 53 fig. 1 (2001), available at http://

europ.eu.int/comm/competition/annual_ reports/2001/

competition_policy/eu.pdf. In much the same manner, myriad

complaints are filed yearly in the United States with the

Antitrust Division of the U.S. Department of Justice and with

the Federal Trade Commission.

To file a complaint with the European Commission, a party

like respondent need only send a letter or a facsimile; with “the

complainant’s name and address,” the “identity of the firms in

question,” “[e]vidence of the complainant’s legitimate interest

in the matter,” and a “clear description of the subject of the

complaint and the reasons for thinking that the practice infringes

[European] Community competition law.” Complaints from the

7

Public on Competition Matters, published at http://europa.eu.

int/comm/competition/citizen/citizen_complaints_en.htm]

(visited Dec. 13, 2003). A similar complaint procedure exists

in both U.S. antitrust enforcement agencies. See How to Report

a Possible Violation, published at http://www.usdoj.gov/atr/

contact/newcase.htm (visited Dec. 13, 2003); Antitrust Contact

Information, published at http://www. ftc.gov/ftc/bccontact.htm

(visited Dec. 13, 2003).

By filing the complaint, respondent initiated an investiga-

tion, in which the Directorate “may gather information on its

own and provide the complainant with an opportunity to support

its allegations.” Pet. App. 3a. “The Directorate also has the

authority to seek information directly from the alleged infringer

{of Community competition law] and may punish a failure to

provide information.” Jbid. (citing Council Regulation 17/64,

arts. 11, 14). The process — which is not an adversary proceed-

ing (ibid.) — is extremely similar in all pertinent respects to the

investigatory process following a complaint made to the U.S.

antitrust enforcement agencies. During an investigation by the

Antitrust Division or Federal Trade Commission, anybody may

comment simply by sending an e-mail to the agency. See

http://www.usdoj.gov/atr/contact.html#cases; http://www. ftc.

gov/ftc/bccontact.htm. Complainants regularly present allega-

tions of anticompetitive conduct to the U.S. agencies. Both

agencies possess authority under the Antitrust Civil Process Act,

15 U.S.C. §§ 1311-1314 (CID Statute), to issue “civil investiga-

tive demands” seeking documents or testimony, and compliance

is compelled by the criminal code, 18 U.S.C. § 1505.

The investigation by the Directorate is a preliminary in-

vestigation, which, as the Ninth Circuit itself recognized, “is not

considered an adversarial proceeding.” Pet. App. 3a (citing

AKZO Chemie BV v. Commission, 1 C.M.L.R. 231, 248 (E.C.J.

1986)). At this point, the Directorate still could simply decide

not to pursue the complaint, an exercise of prosecutorial

discretion potentially subject to limited review by the European

Court of First Instance. Pet. App. 4a (citing Stork Amsterdam

8

BV v. Commission, 5 C.M.L.R. 31, 42 (Ct. of First Instance

2000)); U.S. Br. 19 & n.7 (Oct. 6, 2003) (explaining limited

nature of judicial review of Commission decision not to pro-

ceed). If, after concluding the preliminary investigation, the

Commission were to decide to proceed by issuing a formal

statement of objections against petitioner, petitioner — and not

respondent — would have the right to a hearing before an inde-

pendent hearing officer. The hearing officer would issue a re-

port on the hearing, and thereafter the Commission’s staff would

make a recommendation. Then, based on that recommendation,

the Commission would either dismiss the complaint or issue a

decision drafted by the investigative staff finding a violation.

In this case, the matter has not progressed beyond the pre-

liminary investigation by the Directorate. But, despite the

absence of an adversary proceeding between the Commission

and petitioner, respondent — which would not be a litigant even

at a future stage — seeks discovery under Section 1782.

The Ninth Circuit interpreted Section 1782 to give mere

complainants before the Commission a right to discovery. The

court held that the Commission’s preliminary investigation

sufficed to allow Section 1782 discovery because “the investiga-

tion being conducted by its [the Commission’s] Directorate is

related to a quasi-judicial or judicial proceeding” and,

“{a]lthough preliminary, the process qualifies as a ‘proceeding

before a tribunal’ within the meaning of’ Section 1782. Pet.

App. 7a. The court also was unconcerned that the law of the

European Union does not enable complainants to access the

materials respondent sought from petitioner, holding instead

that Section 1782’s failure expressly to exclude materials not

discoverable under the law of the foreign tribunal means that

those materials are discoverable. Pet. App. 8a. The Ninth

Circuit justified its “allowance of liberal discovery” by citing

the “twin aims of Section 1782: providing efficient assistance

to participants in international litigation and encouraging

foreign countries by example to provide similar assistance to

our courts.” /bid. (citing Jn re Malev Hungarian Airlines, 964

F.2d 97, 100 (2d Cir. 1992)). The Ninth Circuit therefore

.. =".

9

ordered the district court to “consider” respondent’s discovery

request “on the merits.” /d. at 9a.

SUMMARY OF ARGUMENT

The text of Section 1782 limits the parties that may seek

judicial assistance from a U.S. district court under the section to

the tribunal itself and to “interested persons.” In this case the

Directorate expressly declined to request the documents respon-

dent seeks under Section 1782, and the Court of First Instance

certainly has not sought them — so only an “interested person”

may avail itself of the statute. Although the Ninth Circuit failed

to consider the question, respondent cannot be an “interested

person.” The only reasonable reading of the statute limits per-

sons entitled to discovery to litigants and those (principally gov-

ernmental officials) otherwise denominated by foreign law as

having the kind of “interest” that gives them discovery rights

under foreign law — and, unsurprisingly, all indications are that

the reasonable construction is just what Congress intended.

1964 U.S.C.C.A.N. at 3789. Respondent is not a litigant, and

may never be a litigant; and there is no provision of European

Union law that grants respondent the right to discovery.

Section 1782, by its text, permits judicial assistance to

parties seeking discovery only when the request is for use in a

“proceeding in a foreign or international tribunal.” A tnbunal,

in turn, is an adjudicative agency. Respondent sought discovery

under Section 1782 while the Directorate was conducting a pre-

liminary investigation — the result of which at most could be a

decision by the Commission to issue, or not to issue, a formal

statement of objections. Finally, the Commission’s ultimate

decision regarding a formal statement of objections was

reviewable by a tribunal — the European Court of First Instance.

No basis exists for interpreting the phrase “for use in a pro-

ceeding in a * * * tribunal” to encompass discovery at all stages

of investigation that may, or may not, end up before an adjudi-

cative body.

10

The Ninth Circuit also erred by holding that Section 1782

authorzes discovery in the United States even if the materials

sought would not be discoverable in the foreign tribunal.

Despite the Ninth Circuit’s statements to the contrary, this

holding impedes, rather than advances, Congress’s important —

and clearly expressed — concerns for international comity. But

the court’s error extends fu-t%«~, because respondent would not

even be entitled to discovery under U.S. law. The Ninth Circuit

erred by attributing to Congress an intent to enact a discovery

scheme that has no precedent either in domestic or in foreign

law and allows easy circumvention of limitations on discovery

that foreign sovereigns consider important.

ARGUMENT

The Ninth Circuit has adopted a reading of Section 1782

that eliminates ary symmetry of obligations between the United

States and foreign sovereigns; that does violence to the lan-

guage, structure, history, and purposes of the statute; and that

produces far-reaching results that Congress could not have in-

tended. Because the discovery that respondent seeks from peti-

tioner is not available under Section 1782, the Court should re-

verse the decision of the Ninth Circuit. The Ninth Circuit was

wrong on each of the three issues raised by the petition; reject-

ing its position on any one of those issues would dispose of this

case.

The Ninth Circuit’s interpretation of Section 1782 does

violence to the text, structure, and purposes of the statute in

three significant respects. First, by failing to limit discovery to

litigants before the foreign proceedings and a carefully circum-

scribed class of other “interested persons,” the Ninth Circuit’s

interpretation of the statute expands discovery in foreign

proceedings ad infinitum, allowing discovery by any person

who can claim an “interest” in some potential future proceeding

in the broadest possible sense of that term. Second, by treating

an investigation by the Directorate as sufficient because it is,

relates to, or leads to a “proceeding in a foreign * * * tribunal,”

the Ninth Circuit upended the statutory mandate that discovery

11

be permitted only after an adversary proceeding has been

initiated. Third, by allowing discovery that is not permitted

under EU law, the Ninth Circuit undermined the important

international comity rationale underlying Section 1782.

I. Judicial Assistance Under Section 1782 Is

Available to Litigants, to Persons Otherwise

Denominated “Interested Persons” Under

Applicable Foreign Law, and to the Foreign or

International Tribunal — But Not to Respondent

Section 1782 should be construed to limit “interested

person{s]” who may achieve discovery under the section to

litigants before a foreign tribunal — or persons (generally,

governmental officials) that foreign law otherwise permits to

obtain discovery. The Eleventh Circuit has interpreted the

phrase “interested persons” to include private /itigants and

“foreign official[s] properly designated under foreign law.” Jn

re Request for Judicial Assistance from Ministry of Legal

Affairs of Trinidad & Tobago, 848 F.2d 1151, 1155 (2d Cir.

1988). This interpretation imposes a sensible and necessary

limit on the discovery available to private parties under Section

1782. The Ninth Circuit reached the wrong decision largely

because it utterly failed to consider the question whether

respondent was a statutory “interested person.”

Failing to read such a sensible limitation into the phrase

“interested person({s]” has the perverse result of removing all

limits on the set of persons who are authorized by the section to

seek discovery of petitioner’s, and others’, confidential business

or This Court looks to statutory structure, purpose,

and history to read limitations into statutory language that

otherwise is unbounded. See Egelhoff v. Egelhoff, 532 US.

141, 147 (2001) (limiting the scope of the logically unbounded

statutory phrase “relating to” in ERISA preemption). The Court

should do so here.

Congress used precisely the same wording that is found in

Section 1782 — “upon application of any interested person” —

12

elsewhere in the 1964 legislation. ““[I]dentical words used in

different parts of the same act are intended to have the same

meaning.” Department of Revenue v. ACF Indus., Inc., 510

U.S. 332, 342 (1994) (quoting Sorenson v. Secretary of

Treasury, 475 U.S. 851, 860 (1986)). In 28 U.S.C. § 1696(a),

Congress authorized district courts to offer judicial assistance

for service of process in response to a request “by a foreign or

international tribunal or upon application of any interested

person.” The purpose of Section 1696 is to “provide for service

of documents in litigation with international aspects.” 1964

U.S.C.C.A.N. at 3785. If respondent, a non-party, is entitled to

judicial assistance under Section 1782, non-parties likewise are

entitled to judicial assistance making service of process under

Section 1696. But that result makes no sense.

Rather, the phrase “any interested person” should be read

so that both uses are defensible. Restricting “any interested

person” to parties that might have reason to want to effect

service — e.g., litigants — produces just such defensible results.

And the reference in the legislative history to a “person

designated by foreign law” (1964 U.S.C.C.A.N. at 3789; see

Trinidad & Tobago, 848 F.2d at 1155 (“a foreign official

properly designated under foreign law may fall within the

definition of ‘interested person’”)) might readily denote an

official designated to assist in service and discovery matters in

foreign litigation. Compare 28 U.S.C. § 1608(a)(4) (U.S.

Secretary of State designated by U.S. law to assist in service of

process on foreign sovereigns).

All indications are that when enacting Section 1782

Congress intended to limit “any interested person” to private

litigants, or to foreign officials properly designated by foreign

law as having the kinds of responsibilities that entitle them to

discovery as non-litigants. According to the legislative history

of Section 1782, an “interested person” is a “person designated

by foreign law, or a party to the foreign or international

litigation.” 1964 U.S.C.C.A.N. at 3789. See Trinidad &

Tobago, 848 F.2d at1 154-1155 (quoting the legislative history);

13

see also Jn re Lancaster Factoring Co., 90 F.3d 38, 42 (2d Cir.

1996) (“The legislative history to § 1782 makes plain that

‘interested person’ includes ‘a party to the foreign * * *

litigation.””) (quoting 1964 U.S.C.C.A.N. at 3789). President

Kennedy and Director Olney (of the Administrative Office of

the U.S. Courts) spoke only of “private litigants,” and the legis-

lative history otherwise discussed “litigation with international

aspects.” See p. 4, supra. Notably absent from the legislative

history is any discussion of parties, like respondent, that are not

litigants and have no right under foreign law to conduct

discovery in the proceeding for which the U.S. discovery sup-

posedly is sought.

The Acting Solicitor General seems to think discovery

should be denied in this case (see U.S. Br. 18 (Oct. 6, 2003)),

yet he urges that the matter is completely discretionary with dis-

trict judges around the country and that this Court should hold

that mere complainants in European Commission proceedings

are “interested persons” (id. at 16, 18). His sole reasoning in

support of that argument, however, is the ipse dixit that “the

words ‘interested person’ are broad” coupled with the correct

observation that Congress’s selection of that phrase —

posed to “litigant” — was “intentional.” Jd. at 16. But no one

contends that “interested persons” are only litigants — rather, the

dispute is whether the class of “interested persons” who are not

litigants is a very narrow class consistent with the legislative

history, the purposes of the statute, and the use of that phrase in

other provisions of the 1964 legislation; or is instead expansive

so that any old “interest” in the non-legal sense of that word will

suffice. Surely even the Acting Solicitor General would recog-

nize some limits on the “interest[s]” that will trigger Sec-

tion 1782; a scholar’s or corporate gadfly’s or journalist’s literal

“interest” in the European proceedings could not possibly entitle

that person to invoke Section 1782. But the Acting Solicitor

General offers no limiting principle that would draw the line

beyond litigants but short of the entire universe of persons

willing to say, “I’m interested.” Cf. Lujan v. Defenders of Wild-

life, 504 U.S. 555, 567-568 n.3 (1992) (“It is unclear to us what

14

constitutes a ‘genuine’ interest; how it differs from a ‘non-

genuine’ interest (which nonetheless prompted a plaintiff to file

suit); and why such an interest in animals should be different

from such an interest in anything else that is the subject of a

lawsuit.”). Petitioner and the Chamber, by contrast, offer

defensible lines well grounded in both statutory structure and

legislative history.

Interpreting the statute to limit the persons entitled to take

advantage of Section 1782 makes perfect sense in light of the

limitations on discovery available under U.S. law. Under the

Federal Rules of Civil Procedure, discovery is available only if

a party first files a complaint adequate to survive a motion to

dismiss. See Fed. R. Civ. P. 3, 12(b)(6). A defendant’s ability

to seek dismissal under Rule 12(b)(6) — and the ability to seek

sanctions under Rule 11 — ensure that the discovery process is

not employed frivolously. Also, the tort of abuse of process is

available to U.S. defendants who can plead and prove that their

adversary sought to gain from the process, but not from the end,

of the litigation. See, e.g., Warren v. Wasserman, Comden &

Casselman, 271 Cal. Rptr. 579, 581 (Cal. App. 1990)

(describing abuse of process under California law). And the

federal rules permit strict limitations on access to discovery by

non-parties, in the form of protective orders under Rule 26(c).’

Finally, the statutory purposes fully support limiting use of

Section 1782 to litigants and a narrow class of other “interested

* Stringent protections also exist for companies being investigated by

U.S. administrative agencies - including the Antitrust Division and

Federal Trade Commission. The CID statute provides: “[N]o

documentary material, answers to interrogatories, or transcripts of oral

testimony, or copies thereof, so produced shall be available for

examination, without the consent of the person who produced such

material.” 15 U.S.C. § 1313(c)(3). And the Freedom of Information Act

contains express exemptions for “trade secrets and commercial or

financial information obtained from a person and privileged or

confidential” and certain “records or information compiled for law

enforcement purposes.” 5 U.S.C. § 552(b)(4), (b)(7).

15

persons” with legally cognizable interests defined by foreign

law. As the Ninth Circuit itself described “the twin aims of

Section 1782,” they were “providing efficient assistance to

participants in international litigation and encouraging foreign

countries by example to provide similar assistance to our

courts.” Pet. App. 8a (emphasis added) (citing Malev, 964 F.2d

at 100). The obvious conclusion to draw from the fact that these

are the statutory purposes is that only litigants and a small class

of other interested persons closely linked to court proceedings

are the intended beneficiaries of the statute, yet the Ninth

Circuit without analysis announced the polar opposite

conclusion that these purposes support “allowance of liberal

discovery,” Pet. App. 8a, apparently meaning that all statutory

terms are to be construed as expansively as possible. This mode

of statutory interpretation will not do.* Rather, as this Court’s

statutory interpretation jurisprudence dictates, “interested

persons” must be construed no more expansively than the text,

structure, purposes, and history of Section 1782 will support.

As shown above, all of those indicia of legislative intent support

a narrow construction that does not include mere complainants

in European Commission investigations.

Il. Section 1782 Permits Judicial Assistance in Con-

nection With A Proceeding in a Foreign or Inter-

national Tribunal — And Not as Part of a Mere

Investigation by Law-Enforcement Authorities

“The principal requirement imposed by § 1782 is that the

requested discovery be for use in ‘a proceeding.” Jn re Lan-

caster Factoring, 90 F.3d at 41. This Court may reverse the

* — “*Njo legislation pursues its purposes at all costs. Deciding what

competing values will or will not be sacrificed to the achievement of a

particular objective is the very essence of legislative choice — and it

frustrates rather than effectuates legislative intent simplistically to

assume that whatever furthers the statute's primary objective must be the

law.’"” PBGC v. LTV Corp., 496 U.S. 633, 646-647 (1990) (quoting

Rodriguez v. United States, 480 U.S. 522, 525-526 (1987) (per curiam)).

16

decision below because the investigation by the Directorate was

not a proceeding before a tribunal, and not every proceeding

“related to” such a proceeding (Pet. App. 7a) can trigger the

statute. A “tribunal” is a proceeding “in which an adjudicating

function is being exercised.” Lancaster Factoring, 90 F.3d at

41 (holding that a then-pending foreign bankruptcy proceeding

met the statutory requirement). “[N]ot every conceivable fact-

finding or adjudicative body is covered, even when the body

operates under the imprimatur of a foreign government.”

Republic of Kazakhstan v. Biedermann Int'l, 168 F.3d 880, 882

(Sth Cir. 1999). The range of applications for Section 1782 is

limited; as Judge Friendly observed, the section does not “go to

the full extent of authorizing a district court to execute letters

rogatory whenever requested by a foreign country or party

there.” Gov't of India, 385 F.2d at 1020.

The Ninth Circuit held that the preliminary investigation by

the Directorate was sufficient to tigger Section 1782, offering

a justification based on two faulty conclusions. First, by

rejecting petitioner’s argument that the Commission “is not a

tribunal” (Pet. App. 6a), the Ninth Circuit seems to have con-

cluded that at some point the Commission will become a “tri-

bunal,” presumably because the court saw the final decision by

the Commission after a second-phase investigation as a quasi-

judicial proceeding. Second, the Ninth Circuit concluded that

it was adequate that the preliminary investigation in which re-

spondent sought the discovery was “related to a quasi-judicial

or judicial proceeding.” Pet. App. 7a. Both conclusions are

wrong.

A. The proceedings leading to an ultimate Commission

decision are not quasi-judicial. In urging this Court to grant

certiorari in this case, the European Commission stated that

“{t]he Ninth Circuit’s holding fundamentally misconstrues the

nature of the European Commission. The Commission func-

tions primarily as a law enforcement agency in the antitrust field

* * * The Commission * * * never adjudicates disputes be-

tween parties.” Brief of the Commission of the European Com-

17

munities as Amicus Curiae in Support of Petitioner 4-5

(Nov. 15, 2002). The district court reached the same conclu-

sion, citing the European Commission’s Eleventh Report on

Competition Policy (1981): “The Commission{’s] * * * ‘pro-

cedure[] relating to restrictive practices and abuse of dominant

position [the substance of the complaint underlying the Com-

mission’s investigation of petitioner] is administrative and not

judicial; it must not be turned into a trial.’” Pet. App. 14a.

This Court should defer to the Commission’s understand-

ing of its own procedures both as a matter of comity and be-

cause the Commission is far better placed than any other source

to interpret its role. Compare Kolovrat v. Oregon, 366 U.S.

187, 194-195 (1961) (according weight to interpretations by the

government of the Kingdom of Serbia and the U.S. State

Department of a treaty between the countries); S&S Machinery

Co. v. Masinexportimport, 706 F.2d 411, 415 (2d Cir.)

(“[S]tatements of foreign officials — regardless of their political

or ideological orientation — have been accorded great weight in

determining whether an entity is entitled to claim the protection

of the FSIA.”), cert. denied, 464 U.S. 850 (1983). Such defer-

ence is accorded to U.S. agencies’ interpretations of their own

proceedings. See Jnternational Tel. & Tel. Corp. v. Internation-

al Bhd. of Elec. Workers, 419 U.S. 428, 441 (1975) (“While an

agency’s interpretation of the [Administrative Procedure] Act

may not be entitled to the same weight as the agency’s inter-

pretation of its own substantive mandate, its characterization of

its own proceeding is entitled to weight, and that characteriza-

tion may in turn have relevance in determining the applicability

of the Act.’’) (citation omitted).

This Court can reverse the Ninth Circuit’s misinterpreta-

tion of the “proceeding in a foreign * * * tribunal” requirement

on the basis of the Commission’s interpretation of its own law

and procedures. But an analysis of the investigation based on

which respondent sought discovery also leads to the conclusion

that neither the Directorate’s preliminary investigation nor even

18

its final decision is a “proceeding in a * * * tribunal” within the

meaning of 28 U.S.C. § 1782(a).

The preliminary investigation by the Directorate is func-

tionally indistinguishable from a preliminary investigation by

the Antitrust Division or the Federal Trade Commission.

According to European Council Regulation 17/62, art. 14(1):

In carrying out the duties assigned to it * * *, the

Commission may undertake all necessary investigations

* * * To this end the officials authorized by the

Commission are empowered:

(a) to examine the books and other business records;

(b) to take copies of or extracts from the books and

business records;

(c) to ask for oral explanations on the spot;

(d) to enter the premises; land and means of transport

of undertakings.

Also, the Directorate “may obtain all necessary information

from * * * undertakings and associations of undertakings. * * *

The owners of the undertakings or their representatives * * *

shall supply the information requested.” Council Regulation

17/62, art. 11(1), (4).

The Directorate’s investigative powers compare closely

with the powers exercised by the Antitrust Division under the

CID Statute (15 U.S.C. § 1312(a)):

Whenever the * * * Antitrust Division * * * has reason to

believe that any person * * * may have any information,

relevant to a civil antitrust investigation * * *, [it] may

* * * issue in writing * * * a civil investigative demand

requiring such person to produce such documentary

material for inspection and copying * * *, to answer in

writing written interrogatories, to give oral testimony * * *,

or to furnish any combination of such material, answers, or

testimony.

19

Other comparable powers under U.S. law include grand jury

investigations (Fed. R. Crim. P. 6) and search warrants executed

by the FBI (Fed. R. Crim. P. 41).

Once the investigation moves to a second phase — which

the investigation that is the subject of this case has not done —

it is true that the Commission may determine that the party

under investigation has violated the law and may take corrective

measures. But that fact alone does not make the Commission a

“tribunal.” Rather, because the Commission proceeds in the

second phase without an adversary process — a private com-

plainant such as respondent Advanced Micro Devices has no

right to do anything more than observe the non-evidentiary

hearing the Commission conducts before making its decision —

any conclusion by the Ninth Circuit that the Commission is a

“tribunal” is incorrect, even if the investigation reaches the

second phase.”

Also, again, the interpretation of the key phrase “proceed-

ing in a foreign or international tribunal” in Section 1782 must

be harmonized with the interpretation of the identical phrase in

Section 1696. ACF Indus., 510 U.S. at 342. Because Section

1696 allows assistance for service-of-process purposes, a “pro-

ceeding in a foreign * * * tribunal” in that section can only be

a proceeding in which service of process might occur —i.e., not

a mere administrative investigation. It is anomalous to interpret

“proceeding in a foreign * * * tribunal” in Section 1782 (as the

Ninth Circuit did) to encompass an administrative investigation

in which judicial assistance effecting service under Section 1696

would be unnecessary. :

* See Fonseca v. Blumenthal, 620 F.2d 322, 324 (2d Cir. 1980) (“Unlike

the [French] juges d’ instruction, the Superintendent * * * is charged to

act in the government’s interest to enforce the law * * *. He has

extraordinary powers to order and conduct far-reaching investigations.

Upon completion of his investigation, he is empowered to determine

whether violation of the law has occurred. Although the subject of the

investigation may be represented by counsel, the government’s sole

representative is the Superintendent itself.”).

20

The call for harmonization is accentuated in this case be-

cause Congress enacted Section 1696 as part of the same legis-

lation in which it amended Section 1782. Had Congress meant

for the change from “judicial proceeding” to “proceeding in a

foreign * * * tribunal” to render Section 1782 applicable to

administrative investigations or prosecutions, it would have pre-

served the prior statutory term “judicial proceeding” (or some

comparable phrasing) in Section 1696. But the new phrase

gives effect to both sections if “proceeding[s] in a foreign tribu-

nal” encompasses the range of adjudicative functions in which

service of process may be needed, but not other types of legal

procedures. Under that manifestly reasonable interpretation, a

“proceeding” in a “tribunal” does not include either the

preliminary investigation at issue in this case, or any subsequent

(and currently speculative) second-phase investigation.

B. The Ninth Circuit’s analysis is unclear whether it is the

Commission decision to issue, or not to issue, a formal com-

plaint that supposedly constitutes the “proceeding in a tribunal,”

or whether it is the possible later review by the Court of First

Instance. But, in either case, the Ninth Circuit further erred by

creating a “related to” test (Pet. App. 7a) for deciding whether

the investigation by the Directorate might qualify as a pro-

ceeding under Section 1782.

The Ninth Circuit’s exception to the clear statutory limita-

tions on the scope of permissible discovery cannot be justified.

To begin with, this Court has recognized the breadth of the

concept “relatedness.” In an Airline Deregulation Act preemp-

tion decision, Morales v. Trans World Airlines, Inc., 504 U.S.

374, 384 (1992), the Court held that the phrase “relating to” in

former 49 U.S.C. § 1305(a)(1) (now 49 U.S.C. § 41713(b)(1))

was intended to preempt any state law with “‘a connection with,

or reference to”” the subject of the preemption clause. (quoting

Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 97 (1983)). And

relatedness tests also permit courts to aggregate overall effects

of activities that individually may have only de minimis effect.

See United States v. Lopez, 514 U.S. 549, 558 (1995).

21

In creating a “related to” test, the Ninth Circuit apparently

believed that Section 1782 could be employed in any situation

with any connection with a proceeding in a tribunal, even if de

minimis in nature — a concept that readily might reach activities

such as extra-judicial settlement negotiations or mediation. No

basis exists to extend the plain language of Section 1782 this

broadly without any indication in the text of the statute or

elsewhere that Congress had that intent.

And the Ninth Circuit’s attempted justification in no way

explains its unwarranted extension of the plain language of

Section 1782. The court made much of the elimination of the

word “pending” from the text of Section 1782, as if that change

undermined even the clear interpretation of the language that

remains. Pet. App. 6a; accord U.S. Br. 16-17 & n.5 (Oct. 6,

2003). But that minor — and perhaps inadvertent — change in the

text of Section 1782 (see Jn re International Judicial Assistance

for the Federative Republic of Brazil Gen. Univ. Trading Corp.,

936 F.2d 702, 705 (2d Cir. 1991)) cannot bear the weight that

the Ninth Circuit and the Acting Solicitor General have placed

on it. Nothing in the legislative history indicates that Congress

ever intended that the existence of any and all possible future

“proceedings in a foreign * * * tribunal” would justify discovery

of U.S. companies’ documents and testimony. “If the omission

of ‘pending’ was intended to mean ‘eventually occurring,’ we

would expect to see at least some hint of that thought in the

authoritative reports issued by the members of the Senate and

House committees.” Jd. at 706.°

* The Chamber also agrees with the observation at page 9 of the

Commission’s own amicus brief filed December 23, 2003, concerning

possible future review of a non-prosecution decision by the Court of First

Instance: “[I]}f that feature were sufficient for a Section 1782 petitioner

to claim that discovery is ‘for use in a foreign ... tribunal,’ it would open

the statute to discovery requests in connection with every administrative

agency action, regulation, investigation, license or permit anywhere in

the world, so long as the action is ultimately subject to judicial review.

Congress cannot have intended such an extreme result.”

22

The Ninth Circuit’s view of the elimination of the word

“pending” removes any temporal limitation on the discovery

allowed under the statute.’ If it is not true after the amendment

that a proceeding must either be pending or be of the precise

type (pre-indictment criminal investigation) now specifically

identified in the statute, then a much more reasonable interpreta-

tion of the section has been adopted by the Second Circuit. That

court has held that a proceeding justifying discovery under

Section 1782 must be “imminent — very likely to occur and very

soon to occur in order to satisfy the statutory requirements.” Jn

re Euromepa, 154 F.3d 24, 29 (2d Cir. 1998) (internal quotation

omitted). In Jn re Ishihara Chemical Co., 251 F.3d 120 (2d Cir.

2001), although the original proceeding in which the discovery

was sought had concluded, the party seeking discovery argued

that the information would “be used in a new [patent] invalidity

proceeding to be instituted in Japan.” Jd. at 126. The Second

Circuit rejected that argument. The request for discovery was

based on “speculation not only as to the commencement of such

a proceeding, but also as to its need for discovery in such a

proceeding.” /d. at 127 n.4. So too here. Under the Ninth Cir-

cuit’s interpretation of the statute, not only could respondent

seek discovery without being a litigant now or in the near future,

but also respondent would never have to demonstrate that it ever

will be a litigant.*

-

Unwilling to carry his analysis to its logical conclusion, the Acting

Solicitor General rejects an “imminence” requirement but insists that

there is some limit here because the Commission investigation at issue

is “integrally linked to a later ‘proceeding in a foreign or international

tribunal.’” U.S. Br. 17 (Oct. 6, 2003) (emphasis added). But, of course,

the “integrally linked” formulation has no more textual basis than an

“imminence” requirement, and suffers from indeterminacy: it is just as

easy to argue that a Commission investigation is not integrally linked to

a speculative future adjudication as to argue that it is linked to a future

adjudicative proceeding.

* Even the Eleventh Circuit in Trinidad & Tobago - while holding that

the proceeding in a foreign tribunal need not necessarily be pending —

23

In 1996, Congress added to the section the phrase

“including criminal investigations conducted before formal

accusation.” Pub. L. No. 104-106, Div. A, Title XIII (emphasis

added). Congress expanded the judicial assistance permissible

in criminal cases under Section 1782 beyond the scope that was

contemplated previously by the section. Congress’s intent was

very clear. The amended Section 1782 now permits discovery

during the foreign equivalent of the grand jury process — a

statutory change that further harmonizes Section 1782 with U.S.

procedures. In the U.S. system, substantial pre-indictment

investigation occurs — but discovery in the civil system is not

allowed until after the complaint is filed. The need to amend

. Section 1782 specifically to allow pre-indictment judicial

assistance demonstrates that pre-complaint judicial assistance

generally is not contemplated by the Section.

Finally, this Court should read Section 1782 to be con-

sistent with related provisions in the U.S. Code. United Sav.

Ass'n of Texas v. Timbers of Inwood Forest Associates, Ltd.,

484 U.S. 365, 371 (1988) (“A provision that may seem ambig-

uous in isolation is often clarified by the remainder of the statu-

tory scheme * * * because only one of the permissible meanings

produces a substantive effect that is compatible with the rest of

the law.”). Another statutory section, 15 U.S.C. § 6203(a),

permits, “[o]n the application of the Attorney General,” pre-

complaint discovery in the U.S. as a part of foreign antitrust

investigations. Notably, Section 6203 does not permit foreign

antitrust investigative authorities to seek discovery under Sec-

tion 1782. Under the Ninth Circuit’s rule, respondent may use

Section 1782 to conduct discovery before the initiation of a

“proceeding,” but a foreign antitrust authority must apply for

limited its holding to requests from “official[s] properly designated under

foreign law.” 848 F.2d at 1155. “Therefore, the word ‘litigant’ in the

legislative history does not restrict a request for assistance from a foreign

official to ‘pending’ proceedings” (emphasis added) — but “a private

individual may need to be a litigant in order to be an ‘interested person.’”

Ibid.

24

such authority through the Attorney General. There is no basis

in law or policy for this supposed distinction.’

A similar analysis led the Fifth Circuit to hold that foreign

private commercial arbitration was not a “proceeding in a * * *

tribunal” for purposes of Section 1782. See Republic of

Kazakhstan, 168 F.3d at 882-883. In Republic of Kazakhstan,

the court compared to Section 1782 the judicial assistance

available in domestic private commercial arbitration, noting that

“domestically constituted arbitration panels, but not any

‘interested party,’ can invoke federal court jurisdiction to

compel discovery.” Jd. at 883. “It is not likely that Congress

would have chosen to authorize federal courts to assure broader

discovery in aid of foreign private arbitration than is afforded in

its domestic dispute-resolution counterpart.” Jbid. It similarly

is unlikely that Congress would implement careful procedures

(under Section 6203) under which assistance to the Directorate

might be permitted at this pre-complaint stage of the

proceedings, but leave district courts unfettered discretion to

grant private parties access to discovery (under Section 1782).

Ill. Section 1782 Does Not Authorize Circumvention

of Foreign Tribunals’ Limitations on Discovery

This Court should adopt the position of the First and

Eleventh Circuits requiring that “the information sought in the

United States would be discoverable under foreign law.” Jn re

* Section 6203 was enacted as part of the International Antitrust

Enforcement Assistance Act of 1994, Pub. L. 103-488. The Senate

Report accompanying the legislation cites testimony from a range of

corporate interests, including amicus curiae Chamber, which supported

the legislation and expressed concerns about protecting sensitive

information from improper disclosure. S. REP. NO. 103-388, 103d Cong.,

2d Sess., at 5 (1994). It strains credulity to believe that Congress took

pains to protect the privacy of companies subject to investigation where

international antitrust cooperation was concerned, but left untouched

Section 1782, which under the Ninth Circuit’s interpretation allows

unchecked discovery by private parties.

25

Application of Asta Medica, S.A., 981 F.2d 1, 2, 7 (1st Cir.

1992); see Trinidad and Tobago, 848 F.2d at 1156."° This

interpretation gives effect to Congress’s expressed intent to

“bring[{] the United States to the forefront of nations adjusting

their procedures to those of sister nations” — with the goal of

“invit{ing] foreign countries similarly to adjust their

procedures.” 1964 U.S.C.C.A.N. at 3783. In the related context

of the Hague Evidence Convention, this Court expressed

confidence that other sovereigns’ courts would respect U.S.

discovery rules. See Société Nationale Industrielle Aérospatiale

v. U.S. District Court, 482 U.S. 522, 542 (1987) (“It is well

known that the scope of American discovery is often

significantly broader than is permitted in other jurisdictions, and

we are satisfied that foreign tribunals will recognize that the

final decision on the evidence to be used in litigation conducted

in American courts must be made by those courts.”). In similar

regard, Section 1782 should be interpreted to require U.S. courts

to have respect for other jurisdictions’ discovery rules.

But there is more. Respondent would not be entitled to the

information sought in this case under U.S. discovery rules.

Except in rare circumstances not implicated here, there is no

discovery under the Federal Rules of Civil Procedure without

first filing a civil action. See Jn re Application of National

Broadcasting Co., No. M-77 (RWS), 1998 WL 19994, at *7

'© The Ninth Circuit “[{found] nothing in the plain language * * * of

Section 1782 * * * to require a threshold showing on the party seeking

discovery that what is sought be discoverable in the foreign proceeding.”

But the judicial assistance permitted by Section 1782 is for discovery of

documents or testimony “for use in a proceeding in a foreign or

international tribunal.” (emphasis added). It is difficult to imagine how

materials not discoverable in the foreign proceeding could be “for use in”

that proceeding. This understanding also is informed by Congress's

choice of the phrase “in connection with a proceeding in a foreign or

international tribunal” (emphasis added) in Section 1696. Had Congress

employed that broader phrase in Section 1782 as well as in Section 1696,

it might have justified the Ninth Circuit’s rule, but Congress did not do

so.

26

(S.D.N.Y. Jan. 21, 1998) (noting that discovery under the

Federal Rules is limited to parties to an action (per Rule

26(b)(1)) or — in limited circumstances — to a person who

desires to “perpetuate testimony” and who “expects to be a

party in such an action” (per Rule 27(a)). Respondent has done

nothing more than file a complaint with an antitrust enforcement

agency. If the Ninth Circuit’s interpretation of Section 1782

were correct, Congress would have enacted a discovery regime

that is not based either in the laws of the foreign sovereign

where the proceeding justifying the discovery is taking place, or

in the laws of the United States. Congress’s intent, expressed in

the legislative history and uniformly interpreted by the courts,

was to encourage foreign courts to have reciprocal respect for

U.S. litigation procedures. 1964 U.S.C.C.A.N. at 3783; see Pet.

App. 8a. No reason exists for Congress to enact a scheme

permitting judicial “assistance” to a degree that even the liberal

rules of discovery in the U.S. (see Aérospatiale, 482 U.S. at

542) could not possibly justify.

And the statute that Congress enacted must not be

broadened based on some misguided notions of comity. As the

European Commission explained in its certiorari-stage amicus

brief to this Court, the Ninth Circuit’s interpretation of Section

1782, far from “providing efficient assistance to participants in

international litigation” (Pet. App. 8a (citing Malev, 964 F.2d at

100)), actually will undermine foreign antitrust enforcement

efforts. Like the Antitrust Division, the EU Competition

Commission has adopted a corporate leniency policy, whereby

it encourages members of cartels subject to that agency’s

jurisdiction voluntarily to expose the cartel. EC Br. 6 (Nov. 12,

2002). Compare Corporate Leniency Policy, 4 Trade Reg. Rep.

(CCH) 4 13,113, at 20,649-21, 20,649-22 (Aug. 10, 2003)

(Antitrust Division Corporate Leniency Policy). And, like the

U.S. policy, the Commission’s leniency program has been

highly successful. On December 10, the Competition

Commission levied €70 million in fines against members of a

cartel that was exposed under the amnesty policy. EU Jmposes

Almost €70 Million in Fines for Organic Peroxide Cartel Over

27

29 Years, Vol. 85 ISSN No. 2135 (Dec. 12, 2003). The Ninth

Circuit’s rule “could undermine the EC’s Leniency Program by

destroying the confidentiality of submissions to the Commission

and thereby deterring companies from coming forward in the

first place with vital information about illegal cartel activity.”

Deputy Assistant Attorney General Makan Delrahim, Depart-

ment of Justice Perspectives on International Antitrust Enforce-

ment: Recent Legal Developments and Policy Implications 13-

14 (Nov. 18, 2003), available at http://www.usdoj.gov/atr/

public/speeches/201509.pdf (Delrahim Remarks).

As the First Circuit correctly predicted in Jn re Application

of Asta Medica, S.A., 981 F.2d at 6 “foreign countries may be

offended by the use of United States procedure to circumvent

their own procedures and laws.”"’ Indeed, at page 13 of its

merits-stage amicus brief filed December 23, 2003, the

Commission “object[ed] to the potential subversion of limits

that the European Union has imposed * * * on access by an

antitrust complainant to the information that the Commission

gathers in its investigation.”

In Empagran, the court of appeals reached a comparable

result — also from a misguided hyper-extension of policies

'! The Acting Solicitor General tepidly responds that, “[e]ven when

the requesting entity is a private party, the unavailability of discovery

under foreign law does not necessarily imply that foreign tribunals would

take offense at the application of Section 1782.” U.S. Br. 11 (Oct. 6,

2003) (emphasis added). But it is not plausible that a Congress palpably

concerned with international comity left to the case-by-case discretion of

hundreds of district judges the decision to do something that probably

would — but “does not necessarily” — offend a foreign court. It is a par-

ticularly strained interpretation of the will of Congress to conclude simul-

taneously both that private non-litigants before a non-tribunal can invoke

Section 1782, and that they are not limited to discovering that which

would be discoverable under foreign law. The Acting Solicitor General

notably does not believe that such discovery really should be authorized

(id. at 18) but implausibly attributes to Congress the intention to leave

these delicate questions to the discretion of district courts.

28

underlying a statutory scheme. In Empagran, the D.C. Circuit

relied primarily on a deterrence rationale as justification for

permitting worldwide plaintiff classes under the Foreign Trade

Antitrust Improvements Act, 15 U.S.C. § 6a, including plaintiffs

whose injuries occurred in transactions having no nexus to the

United States. In a brief urging rehearing, the Solicitor General

and the Antitrust Division argued that the increase in potential

liability threatened the opposite effect from deterrence. Because

companies that break from and expose a cartel remain civilly

liable, increasing civil liability has the perverse effect of

cementing cartels by making it more costly for a cartel member

to break from the cartel under the Justice Department amnesty

policy.

Of course, disincentives also arise, threatening the Anti-

trust Division’s leniency policy, if foreign countries adopt poli-

cies that somehow make it more expensive for members of

cartels with impacts on U.S. commerce to take advantage of the

leniency policy. The comity rationale that the Ninth Circuit

blithely cited in support of “liberal discovery” rules (Pet. App.

8a) ignores the equal importance of mutual respect for

sovereigns’ decisions how to enforce, and how not to enforce,

their laws. See Jn re Application for an Order for Judicial

Assistance in a Foreign Proceeding, 147 F.R.D. 223, 225 (C.D.

Cal. 1993) (“The intent behind [Section 1782] was to * * *

maintain respect for foreign countries’ sovereign jurisdiction.”),

overruled by Advanced Micro Devices, Inc. v. Intel Corp., 292

F.3d 664 (9th Cir. 2002) (see Pet. App. 9a n.4). The Ninth

Circuit’s rule risks encouraging other countries to adopt pro-

cedures that undermine the judicial processes of the United

States. See Asta Medica, 981 F.2d at 7 (“[T]he broader goal of

the statute — stimulating cooperation in international and foreign

litigation — would be defeated since foreign jurisdictions would

be reluctant to enact policies similar to Section 1782.”). That

result would be inimical to Congress’s intent in enacting Section

1782, which was to “bring[] the United States to the forefront of

nations adjusting their procedures to those of sister nations.”

1964 U.S.C.C.A.N. at 3783.

ata

29

Also like the D.C, Circuit in Empagran, a case that raised

international concern by imposing U.S. antitrust laws and

policies on foreign nations (see Delrahim Remarks, supra, at 9-

10), the Ninth Circuit has made the uniquely liberal U.S. discov-

ery system the choice option for litigants in foreign countries.

Such a race-to-the-bottom approach will inevitably have the

effect of encouraging global forum shopping and making the

most liberal legal system the worldwide standard. Congress

enacted both the FTAIA and Section 1782 to enhance interna-

tional comity. The effect that these decisions threaten — making

the United States the de facto courtroom to the world — was a

result that Congress never intended.

CONCLUSION

The judgment of the court of appeals should be reversed.

Respectfully submitted.

ROBIN S. CONRAD Roy T. ENGLERT, JR.

National Chamber Counsel of Record

Litigation Center, Inc. MAX HUFFMAN

1615 H Street, N.W. Robbins, Russell, Englert,

Washington, D.C. 20062 Orseck & Untereiner LLP

(202) 463-5337 1801 K Street, N.W.

Suite 41]

Washington, D.C. 20006

(202) 775-4500

DECEMBER 2003