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§ 1782 Applications Are Properly Brought Ex Parte — Discovery Sought to Defend Hong Kong Defamation Suit on Grounds That Sheldon Adelson Is “Foul-Mouthed”

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In re Application of Kate O’Keeffe, 2016 U.S. App. LEXIS 9615 (2d Cir. May 26, 2016):

Movant-appellant Sheldon G. Adelson ("Adelson") appeals from an April 1, 2016 order of the District Court denying his motion to quash a subpoena served by petitioner-appellee Kate O'Keeffe ("O'Keeffe") upon Adelson's former driver, Kwame Luangisa ("Luangisa"), pursuant to 28 U.S.C. § 1782. We assume the parties' familiarity with the underlying facts, the procedural history of the case, and the issues on appeal.

Adelson has sued O'Keeffe in Hong Kong for defamation. His claim involves an article that O'Keeffe co-authored for the Wall Street Journal, which described Adelson as "foul-mouthed."1 O'Keeffe's defense in that [*2]  lawsuit depends, in part, on her contention "that the term foul-mouthed is true in substance and fact." App. 12 (internal quotation marks omitted). To facilitate that defense, O'Keeffe seeks to subpoena Luangisa for evidence of Adelson's use of "foul" language.

1   See Kate O'Keeffe & Alexandra Berzon, Fired Executive Rankles Casino Business, Wall St. J. (Dec. 5, 2012), http://www.wsj.com/articles/SB10001424127887324784404578142952070044598 (describing Adelson as "a scrappy, foul-mouthed billionaire from working-class Dorchester, Mass.").

Because O'Keeffe seeks discovery pursuant to § 1782, her application must meet three statutory requirements: "(1) that the person from whom discovery is sought reside (or be found) in the district of the district court to which the application is made, (2) that the discovery be for use in a proceeding before a foreign tribunal, and (3) that the application be made by a foreign or international tribunal or any interested person." Application of Esses, 101 F.3d 873, 875 (2d Cir. 1996) (internal quotation marks omitted). Once these requirements are met, we review a district court's decision to grant or deny a § 1782 application--or, as in this case, to grant or deny a motion to quash a subpoena issued pursuant to such an application--for "abuse of discretion." Brandi-Dohrn v. IKB Deutsche Industriebank AG, 673 F.3d 76, 79-80 (2d Cir. 2012). Adelson does not dispute that [*3]  O'Keeffe's application satisfies the statutory requirements of § 1782. Instead, he argues only that the District Court "abused its discretion" in denying his motion to quash. We reject that argument as meritless.

The Supreme Court has provided several factors that a district court should consider in exercising its discretion under § 1782: (1) whether "the person from whom discovery is sought is a participant in the foreign proceeding"; (2) "the nature of the foreign tribunal, the character of the proceedings underway abroad, and the receptivity of the foreign government or the court or agency abroad to U.S. federal-court judicial assistance"; (3) whether the "request conceals an attempt to circumvent foreign proof-gathering restrictions or other policies of a foreign country or the United States"; and (4) whether the request is "unduly intrusive or burdensome." Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 264-65 (2004).

The District Court carefully considered the four Intel factors, and it acted well within its discretion in determining that they weighed in favor of denying the motion to quash. First, Luangisa is not a party to the Hong Kong litigation. Second, Adelson has not offered evidence that Hong Kong courts are unreceptive to U.S. judicial assistance. [*4]  Cf. Application of Esses, 101 F.3d 873, 876-77 (2d Cir. 1996) (suggesting the receptivity of Hong Kong courts to U.S. judicial assistance). At most, Adelson has suggested that O'Keeffe seeks evidence which would not be discoverable in Hong Kong. But as Adelson acknowledges, our precedents expressly forbid district courts from considering the discoverability of evidence in a foreign proceeding when ruling on a § 1782 application. See Brandi-Dohrn, 673 F.3d at 81-83. Similarly, the mere fact that the discovery sought here might not be obtainable under Hong Kong law does not, by itself, suggest that O'Keeffe's application is an "attempt to circumvent foreign proof-gathering restrictions." See Mees v. Buiter, 793 F.3d 291, 303 (2d Cir. 2015). Finally, Adelson does not argue that the subpoena is unduly burdensome to Luangisa, who has not objected to it.

We also reject Adelson's suggestion that it was impermissible or improper for O'Keeffe to bring her application ex parte. "[I]t is neither uncommon nor improper for district courts to grant applications made pursuant to § 1782 ex parte." Gushlak v. Gushlak, 486 F. App'x 215, 217 (2d Cir. 2012) (summary order) (collecting cases).

CONCLUSION

We have reviewed all of the arguments raised by Adelson on appeal and find them to be without merit. For the foregoing reasons, we AFFIRM the order of the District Court.

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New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.
New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.

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