Opposition Brief — Rutgerswerke AG v. Bettis

-_

| tmupreme Court, US.

No. 94-865 FILED

—WOV-35-4

IN THE OFFICE OF THE CLERK

SUPREME COURT OF THE UNITED staTes—

OCTOBER TERM, 1994

RUTGERSWERKE, AG,

Petitioner,

V.

KAY BETTIS, et al.,

Respondents.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Sixth Circuit

BRIEF OF RESPONDENTS IN OPPOSITION TO

PETITION FOR A WRIT OF CERTIORARI

DENNIS E. MURRAY, SR.

Counsel of Record

KIRK J. DELLI BOVI

Murray & Murray Co., L.P.A.

111 East Shoreline Drive

Sandusky, Ohio 44870

Telephone: (419) 524-3000

Counsel for Respondents

November 30, 1994

i

TABLE OF CONTENTS

pr ge Pts eee

REASONS FOR DENYING THE PETITION........

|. Aerospatiale Was Properly Decided

And Has Proven Workable In Practice... .

ll. The Judicial System-Abusing Strata-

gem Employed By Petitioner To Bring

This Issue Before This Court Precludes

Petitioner's Entitlement To Review.......

lll. Pied Piper-Style Commentaries By

Some Students, Academics And

Practitioners, Without Anything More,

Are An Insufficient Basis For This

Court To Reconsider And Reverse A

Recent Decision That Has Been Well-

Received By Everyone Else, Including

The Federal And State Courts...........

IV. Petitioner Never Asserted, In The

Lower Courts, That Aerospatiale

Should Be Reversed. Petitioner May

Not Do So, For The First Time, In This

V. Petitioner Is Before This Court Only

To Delay, For As Long As Possible, The

Commencement Of Trial In This Five

Year-Old, Certified Environmental

ee ae eee ou’

TS ee er ee

ii

TABLE OF AUTHORITIES

PAGE(S)

CASES:

Erbach Finance Corp. v. Royal Bank of

Canada, 199 App.Div.2d 87, 605

N.Y.S.2d 52 (First Dept. 1993)............. 4

Haynes v. Kleinwefers, 119 F.R.D. 335

ec cies ke ewe ees 4

Hudson v. Herman Pfauter GmbH & Co.,

ree BS | fl gy Ee 4

Knight v. Ford Motor Co., 260 N.J. Super.

oe Fk) 8 4

Moake v. Source International Corp., 263 N.J.

Super. 455, 623 A.2d 263 (1993)............ 4

Scarminach v. Goldwell GmbH, 140 Misc.2d

103, 531 N.Y.S.2d 188 (1988).............. 4

ua inhed foes Daman Coot 482 US.

er Eek a yeh e ns ose esccses 2-10

STATUTES/TREATISES:

Fed. R. Civ. P. 12(b)(2)... 20.0.0. ee cee eee a

The Hague Evidence Convention on the

Taking of Evidence Abroad in Civil or

Commercial Matters, 23 U.S.T. 255,

T.LA.S. No. 7444, 28 U.S.C.A. §1781

Cee ak he Uris Shakes ss se dee 2-10

No. 94-865

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1994

RUTGERSWERKE, AG,

Petitioner,

V.

KAY BETTIS, et al.,

Respondents.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Sixth Circuit

BRIEF OF RESPONDENTS IN OPPOSITION TO

PETITION FOR A WRIT OF CERTIORARI

REASONS FOR DENYING THE PETITION

Petitioner requests this Court to review a

unanimous appellate court denial of its petition for a writ

of mandamus. Petitioner does so in order that it may

launch an attack -- never made in the courts below -- on

2

this Court’s holding in Societe Nationale Industrielle

Aerospatiale v. United States District Court, 482 U.S. 522

(1987). Aerospatiale is sound in principle and workable

in practice. The decision has been approved, followed

and properly implemented by federal and state courts

alike. The clear majority of post-Aerospatiale decisions,

including the lower court rulings in this action, have

ordered discovery under the federal rules, while a

minority has required discovery pursuant to the Hague

Evidence Convention. This is how it should be with any

case-by-case analysis. No state supreme court or federal

court of appeals -— apart from the case at bar -- has

considered Aerospatiale. Only a handful of students and

academics, unfamiliar with the workaday world of

international discovery and litigation, along with a few

practitioners furthering the interests of their foreign

clients, have proffered any criticism.

Mandated discovery, pursuant to the Hague

Evidence Convention’ in every case, would create an

unlevel playing field — not only between foreign entities

operating in the United States and their domestic

competitors - but also between foreign entities who

utilize the federal discovery rules as a sword to obtain

discovery from United States citizens, while

simultaneously hiding behind the Hague Evidence

Convention to shield themselves from identical discovery.

There exist no “special and important reasons” to justify

‘Formally, The Hague Evidence Convention on the

Taking of Evidence Abroad in Civil or Commercial

Matters, 23 U.S.T. 255, T.1LAS. No. 7444, 28 U.S.C.A.

§1781 (1994).

3

this Court’s exercise of discretion to review a magistrate

judge’s memorandum opinion and order implementing

Aerospatiale in a discovery proceeding in a pending

action. The bizarre posture of this case before this Court

evidences petitioner's stratagem to appeal every adverse

issue and to delay the trial in this five year-old certified

environmental class action for as long as possible. This

Court should not tolerate petitioner's misuse of the

appellate courts. The petition for a writ of mandamus

should be denied.

I. AEROSPATIALE WAS PROPERLY DECIDED

AND HAS PROVEN WORKABLE IN PRACTICE.

Petitioner requests this Court to “reconsider and

reverse its precedent” established only seven years ago

in iete Nationale Industrielle Aerospatiale v. United

tates District Court, 482 U.S. 522 (1987). Petitioner

brands this Court’s holding in Aerospatiale “unsound in

principle and unworkable in practice’. Petitioner is

wrong.

Not one United States circuit court of appeals, not

one federal district court and not one state court has

shared petitioner's view. Since 1987, of thirteen reported

decisions applying Aerospatiale, petitioner concedes that

three “have ordered litigants to use the Hague Evidence

Convention procedures,” while ten “have ordered litigants

to use the federal rules”. None of the state and federal

courts which have implemented Aerospatiale have

questioned its soundness in principle. Each has found

the Aerospatiale’s analysis workable.

4

The overwhelming majority of the reported

decisions - like the district court and court of appeals

decisions in the cause sub judice - have upheid the right

to discovery under the federal rules. A minority of

decisions have favored Hague Evidence Convention

procedures. This split evidences the fact that courts are

properly employing the case-by-case analysis posited in

Aerospatiale. Notably, in two of the three states which

have seen decisions in favor of first resort to the Hague

Evidence Convention, subsequent court decisions in

those same states have ordered discovery under the

federal rules. Cf. Hudson v. H n Pfauter GmbH & Co.,

117 F.R.D. 33 (N.D.N.Y. 1987) (Hague) with Haynes v.

Kleinwefers, 119 F.R.D. 335 (E.D.N.Y. 1988) (federal

rules), Scarminach v. Goldwell GmbH, 140 Misc.2d 103,

531 N.Y.S.2d 188 (1988) (federal rules), and Erbach

Finance Corp. v. Royal Bank of Canada, 199 App.Div.2d

87, 605 N.Y.S.2d 52 (First Dept. 1993) (federal ruies).

Also cf. Knight v. Ford Motor Co., 260 N.J. Super. 110,

615 A.2d 297 (1992) (Hague) with Moake v. Source

International Corp., 263 N.J. Super. 455, 623 A.2d 263

(1993) (federal rules). The district court and court of

appeals decisions in the cause sub judice properly apply

Aerospatiale in a manner consistent with this Court's

holding and uniformly and unanimously reach a result

consistent with the clear majority of decisions

implementing Aerospatiale.

There is no reason, whatsoever, for this Court to

reconsider, much less reverse, a seven-year-old decision

which is based on sound principles and which has proven

so workable in the federal district courts that there is not

one reported post-Aerospatiale decision from any United

States court of appeals, nor any petition requesting this

5

Court’s reconsideration of Aerospatiale — apart from this

action. This case hardly presents to this Court “special

and important reasons’ justifying its exercise of discretion

to grant petitioner's request for review.

il. THE JUDICIAL SYSTEM-ABUSING STRATAGEM

EMPLOYED BY PETITIONER TO BRING THIS

ISSUE BEFORE THIS COURT PRECLUDES

PETITIONER’S ENTITLEMENT TO REVIEW.

Petitioner glosses over the bizarre machinations

which it employed to bring this case before this Court.

Petitioner asks this Court to review -— bottom-line -- a

magistrate judge’s memorandum opinion and order

overruling petitioners motion for a protective order as

part of pretrial discovery in a pending civil action! The

only case cited by the magistrate judge is Aerospatiale.

Petitioner appealed that adverse ruling to the district

court, which cited only one case in affirming the

magistrate judge’s decision: Aerospatiale* Petitioner

then filed a petition for a writ of mandamus in the Sixth

Circuit Court of Appeals. The appellate court’s order

cited only one case addressing the merits of petitioner's

? Prior to affirming the magistrate judge’s memorandum

opinion and order addressing Aerospatiale, the district

court overruled petitioner's Fed. R. Civ. P. 12(b)(2)

motion to dismiss for lack of in personam jurisdiction.

The district court held that respondents - even absent

discovery from petitioner — established a prima facie

showing of an alter-ego relationship between petitioner

and its wholly-owned United States subsidiary.

6

claim: Aerospatiale. The Sixth Circuit unanimously

denied the mandamus petition, holding that petitioner had

not established “a clear and indisputable right to relief in

mandamus as a result of the district court’s decision.” In

summary, this Court is being asked to review a

unanimous appellate court denial of a petition for a writ of

mandamus challenging a district court's affirmation of a

magistrate judge’s memorandum opinion and order

denying a motion for a protective order. That is hardly an

appropriate function for this Court in our jurisprudential

system.

lil. PIED PIPER-STYLE COMMENTARIES BY SOME

STUDENTS, ACADEMICS AND PRACTITION-

ERS, WITHOUT ANYTHING MORE, ARE AN

INSUFFICIENT BASIS FOR THIS COURT TO

RECONSIDER AND REVERSE A RECENT

DECISION THAT HAS BEEN WELL-RECEIVED

BY EVERYONE ELSE, INCLUDING THE FED-

ERAL AND STATE COURTS.

Petitioner predicates its contention _ that

Aerospatiale should be reversed on nothing more than a

collection of articles -- which petitioner never cited below

- by some students, academics and practitioners

criticizing Aerospatiale in Pied Piper fashion. The clear

maiority of those articles were written before, and thus fail

to take into account, many of the thirteen ~— with this

case, fourteen - reported decisions which establish the

soundness and workability of this Court’s holding. The

Critique of these students and academics is not shared by

the very courts which have borne the responsibility for

7

implementing Aerospatiale on a case-by-case basis.

Those courts have found little difficulty whatsoever in

performing this relatively simple task.

The student-authors have no knowledge of the

day-to-day workings of international discovery and the

academics are usually divorced from the practice. As for

those practitioners who have written on the subject -- they

have often taken up the pen to further the undisclosed

interests of their foreign clients. Those practitioners

advocate -- bottom-line -- the proposition that foreign

interests doing business in the United States may hide

behind an impenetrable veil of corporate secrecy (in

Germany, for example, where there is no such thing as

pretrial document discovery) sewn by their sovereign to

avoid precisely the full and fair discovery to which any

United States corporation would be subject. If foreign

interests doing business in the United States are not

governed by the same judicial system and the same rules

applicable to United States citizens, the playing field is

unjustifiably and unfairly skewed. In this cause, for

example, petitioner has repeatedly used the federal rules

as a sword to obtain document discovery from

respondents, while simultaneously using the Hague

Evidence Convention in order to shield itself from

identical discovery requests.

8

IV. PETITIONER NEVER ASSERTED, IN THE

LOWER COURTS, THAT AEROSPATIALE

SHOULD BE REVERSED. PETITIONER MAY

NOT DO SO, FOR THE FIRST TIME, IN THIS

COURT.

Petitioner never asserted, in the courts below, that

Aerospatiale should be reversed. Indeed, petitioner

consistently argued that Aerospatiale, properly applied,

compelled the granting of the relief which it requested.

Petitioner now switches its theory and -- for the first time,

in this Court -- attacks Aerospatiale, urging not its

implementation, but its reversal.

Petitioner is well-aware that this Court would not

accept jurisdiction to simply review whether or not a lower

court properly applied Aerospatiale to the facts before it.

This Court should not countenance petitioner's stratagem

of rewriting its position regarding Aerospatiale before this

Court in an effort to cause this Court to accept jurisdiction

which it otherwise would have summarily denied.

Petitioner's first-time challenge to Aerospatiale in this

Court is yet another reason which should compel this

Court to refrain from any exercise of jurisdiction.

9

V. PETITIONER IS BEFORE THIS COURT ONLY

TO DELAY, FOR AS LONG AS POSSIBLE, THE

COMMENCEMENT OF TRIAL IN THIS FIVE

YEAR-OLD, CERTIFIED ENVIRONMENTAL

CLASS ACTION.

This certified environmental class action has been

pending for nearly five years. Defendants are alleged to

have contaminated, contributed to and furthered the

contamination of, thirty miles of a pristine creek, wetlands

and floodplain with toxic and hazardous chemicals,

including a banned, carcinogenic pesticide which has

been detected throughout the affected area and in the

bodies of class members. Petitioner's appeals from every

adverse ruling of the magistrate judge, petitioner's

mandamus petition in the Sixth Circuit, and petitioner's

petition for certiorari in this Court are all part of a master

stratagem to delay the trial of this cause as long as

possible -- while the class and the environment continue

to suffer the effects of Ohio’s largest environmental

debacle. Indeed, even as its petition pends before this

Court, petitioner continues to refuse to provide the

discovery which the district court and the court of appeals

have held must be produced.

CONCLUSION

The petition for certiorari should be denied. in no

other case has this Court been asked to reconsider, much

less reverse, Aerospatiale. Aerospatiale’s soundness

and proven workability is the reason why. Aerospatiale is

10

good law and the courts know it. Congress has known

about Aerospatiale for seven years and has done nothing

to criticize the decision or to legislate in the field. There

are far more important issues for this Court to consider

than petitioner's personal pique with a magistrate judge’s

memorandum opinion and order in a_ discovery

proceeding in a pending action.

For all of the reasons posited above, petitioner’s

request for a writ of certiorari to review the appellate

court’s unanimous dismissal of petitioner's petition for a

writ of mandamus to order a district court to reverse a

magistrate judge’s memorandum and order, and to

require all discovery of petitioner to be pursuant to the

Hague Evidence Convention, should be denied.

Respe re submitted,

mw, (L. Kan4\

DENNIS E MURRAY ‘SR.

Counsel of Record

KIRK J. DELLI BOVI

Murray & Murray Co., L.P.A.

111 East Shoreline Drive

Post Office Box 19

Sandusky, Ohio 44871-0019

Telephone: (419) 624-3000

Counsel for Respondents

November 30, 1994