Why The Rest of the World Thinks We’re Crazy

This decision was reported yesterday. In Gucci Amer., Inc. v. Curveal Fashion, 2010 WL 808639 (S.D.N.Y. Mar. 8, 2010) a foreign corporation, which was not a party to the underlying action, was ordered to produce documents despite a statute in that corporations country of corporate foundation that prohibited such a production.  And that’s not the crazy part.

Plaintiffs in the case moved to compel the production of documents and information regarding a bank account in Malaysia held by the defendant.  A subpoena was served on United Overseas Bank’s New York Agency which was not a party to the underlying action. The court, even after hearing evidence that such a production was prohibited by Malaysian law and that violation of the law could subject a person to civil and criminal penalties, ordered UOB NY to produce the information.

Why? Here comes the crazy part.

The court looked to a 5 part test which is laid down in the Restatement (Third) of Foreign Relations Law of the United States. The same standard has been upheld by numerous courts around the country, up to and including the U.S. Supreme Court.  The five factors in that test are:

      (1) the importance of the documents or information requested to the litigation

      (2) the degree of specificity of the request

      (3) whether the information originated in the United States

      (4) the availability of alternative means of retrieving the information

      (5) the extent to which noncompliance with the request would undermine important interests of the United States, or compliance with the request would undermine the important interests of the state where the information is located.

The court held that factors one and two weighed in favor of the plaintiffs, the third favored UOB NY and the fourth, since the expense and practicalities of a proceeding in Malaysia meant the information could not be “easily obtained” there, favored plaintiffs. 

The court then noted that the fifth factor was  “of the greatest importance in determining whether to defer to the foreign jurisdiction.”  And should it defer in this case? No because “the United States interest in fully and fairly adjudicating matters before its courts…outweighs Malaysia’s interest in protecting the confidentiality of its banking customers’ records.” 

OK, so the reason is our lawsuits are more important than your statutes protecting confidential information.  Really? That’s the reason?

And when they read this decision in Germany or Italy or France, what will they think?  Probably that they should make it even harder for U.S . courts to get their documents than they do now.

You can read a more detailed disucssion of the case and download a copy of the full opinion at the K&L Gates Electronic Discovery Law site.

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4 comments so far

  1. Editor on

    Well done Tom, spot on as always. You understate it though in saying that EU and other countries “should make it even harder for U.S . courts to get their documents than they do now. Not “should” but “will”, as I have been predicting with each successive such decision last year. Furthermore, this was S.D.N.Y. Chris Dale

  2. […] have to check out this post from Tom O’Connor on his docNative Paradigm blog.    Tom covers the Gucci Amer., Inc. v. Curveal Fashion case, 2010 WL 808639.  Basically, […]

  3. […] article by the respected US e-Discovery commentator Tom O’Connor Why the Rest of the World Thinks we are Crazy concerns an Opinion of the District Court of the Southern District of New York which orders a […]

  4. […] article by the respected US e-Discovery commentator Tom O’Connor Why the Rest of the World Thinks we are Crazy concerns an Opinion of the District Court of the Southern District of New York which orders a […]


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