Kiobel Returns before Dutch Courts Seeking Application of Section 1782
Royal Dutch Shell (Shell) is currently having a tough time defending itself in court: A few days ago, we discussed the recent judgment from the English High Court that dismissed a claim brought against Shell for oil pollution in Nigeria. This time we discuss a decision by the U.S. District Court of the Southern District of New York (the S.D.N.Y) which granted a petition to access documents in the possession of Shell’s lawyers for use in legal proceedings against Shell in the Netherlands.
The plaintiff in this case (Esther Kiobel), is well-known to U.S. courts. In fact, she gave her name to a leading class action case before U.S. courts in which she sought reparation against Shell for human rights violations committed by the Nigerian government (with the complicity of Shell) against her and others in Nigeria when they opposed Shell’s activities in this country. She relied at the time on the U.S. Alien Tort Statute, which allows foreign citizens to seek remedies in U.S. courts for a tort committed outside the United States.
The case ultimately came before the U.S. Supreme Court, which ruled that U.S. federal courts did not have jurisdiction to hear claims for violations of international law that took place wholly outside U.S. territory. Mrs Kiobel’s case was therefore dismissed.
Seeking other legal alternatives, she intended to file an action in the Netherlands where Shell is headquartered. However, in anticipation of these Dutch proceedings (and in order to supplement her application), she sought to obtain the documents and other discovery materials that Shell’s lawyer – the New York-based law firm Cravath, Swaine & Moore LLP (Cravath) – had produced on Shell’s behalf in the earlier U.S. case but which were protected by a confidentiality agreement and were prohibited from being used for another purpose.
Since Cravath was based outside the jurisdiction of the Dutch courts, Mrs Kiobel brought an action before the S.D.N.Y on the basis of 28 U.S.C. Section 1782 (Section 1782). As we discussed before, Section 1782 is a U.S. Federal Statute that allows a litigant before a “foreign or international tribunal” outside the United States to apply to the U.S. district courts to obtain discovery against a person or entity residing or found in the district where the application is sought.
On 24 January 2017, the S.D.N.Y granted Mrs Kiobel’s petition and ordered Cravath to produce the requested documents.
More specifically, the S.D.N.Y ruled that all the conditions necessary to rely on Section 1782 (i.e. (i) that the person from who discovery is sought resides or is found in the district where the application is made; (ii) that the discovery is used in a proceeding before a foreign tribunal; and (iii) that the application is made by a foreign or international tribunal or an interested person) were met.
Cravath argued, however, that as Shell (and not itself) was the participant in the foreign proceeding, Mrs Kiobel could not rely on Section 1782 against Cravath, but only against Shell.
Interestingly, the S.D.N.Y rejected this argument and found that “the question of whether the respondent [i.e. Cravath] is a party to the foreign proceeding is not the only relevant consideration. Rather, the respondent’s connection to the foreign proceeding is part of a broader inquiry: whether the discovery is ‘outside the foreign tribunal’s jurisdictional reach,’ and thus ‘unobtainable absent’ [assistance from Section 1782].” In the case at hand, the S.D.N.Y found that there were “several reasons” why the discovery may not be obtainable absent the aid of Section 1782: (i) Kiobel needed some discovery in order to effectively begin the Dutch proceedings; and (ii) even if Kiobel was able to obtain discovery from Shell in the Dutch proceeding, “not all of the materials that Kiobel [sought were] likely to be in Shell’s possession” (such as deposition transcripts).