SERVOTRONICS, INC., Petitioner-Appellant, v. ROLLS-ROYCE PLC and THE BOEING COMPANY, Intervenors-Appellees.
No. 19-1847
United States Court of Appeals For the Seventh Circuit
September 22, 2020
975 F.3d 689
Before SYKES, Chief Judge, and HAMILTON and BRENNAN, Circuit Judges.
ARGUED SEPTEMBER 19, 2019 — DECIDED SEPTEMBER 22, 2020
Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 18-cv-7187 — Elaine E. Bucklo, Judge.
Two decades ago, the Second and Fifth Circuits answered this question “no,” holding that
More recently, the Sixth Circuit reached the opposite conclusion, Abdul Latif Jameel Transp. Co. v. FedEx Corp. (In re Application to Obtain Discovery for Use in Foreign Proceedings), 939 F.3d 710, 714 (6th Cir. 2019), and the Fourth Circuit agreed, Servotronics, Inc. v. Boeing Co., 954 F.3d 209, 214 (4th Cir. 2020). We join the Second and Fifth Circuits and hold that
I. Background
The backdrop for this case is an indemnification dispute over losses incurred when an aircraft engine caught fire during testing in South Carolina. Rolls-Royce PLC manufactured and sold a Trent 1000 engine to the Boeing Company for incorporation into a 787 Dreamliner aircraft. In January 2016 Boeing tested the new aircraft at its facility near the Charleston International Airport. A piece of metal became lodged in an engine valve, restricting the flow of fuel to the engine. As Boeing employees attempted to fix the problem, the engine caught fire, damaging the aircraft. Boeing demanded compensation from Rolls-Royce, and in 2017 the companies settled for $12 million. Rolls-Royce then sought indemnification from Servotronics,
Under a long-term agreement between Rolls-Royce and Servotronics, any dispute not resolved through negotiation or mediation must be submitted to binding arbitration in Birmingham, England, under the rules of the Chartered Institute of Arbiters (“CIArb“). Negotiations did not bear fruit, so Rolls-Royce initiated arbitration with the CIArb. For convenience, the parties agreed to conduct the arbitration in London.
Servotronics thereafter filed an ex parte application in the U.S. District Court for the Northern District of Illinois asking the court to issue a subpoena compelling Boeing to produce documents for use in the London arbitration. The application invoked
II. Discussion
A. Statutory Framework
Sections 1781 and 1782 of Title 28 govern the district court‘s authority to provide discovery assistance in litigation in foreign and international tribunals.
Letters rogatory are transmitted through diplomatic agencies; the statute provides that the State Department may, either “directly, or through suitable channels, ... receive a letter rogatory issued, or request made, by a foreign or international tribunal, to transmit it to the tribunal, officer, or agency in the United States to whom it is addressed,” and “receive and return it after execution.”
The district court of the district in which a person resides or is found may order
him 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 tribunal or upon the application of any interested person and may direct that the testimony or statement be given, or the document or other thing be produced, before a person appointed by the court.
The statute also gives the judge the discretion to prescribe procedures for the collection of evidence, including the option to require adherence to the practice and procedure of the foreign country or international tribunal in question:
The order may prescribe 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.
This case involves a
B. Applicability to Private Foreign Arbitrations
This is a question of first impression for our circuit, but several other circuits have addressed it and a split has recently emerged. The disagreement centers on the meaning of the statutory phrase “foreign or international tribunal“—or more particularly, the word “tribunal.”
The Second Circuit was the first to confront the question more than 20 years ago. The court began by observing that although the phrase “foreign or international tribunal” does not unambiguously exclude private arbitral panels, neither does it unambiguously include them. Nat‘l Broad. Co., 165 F.3d at 188. After reviewing the statutory and legislative history, the court concluded that the phrase, considered in context, is limited to state-sponsored foreign and international tribunals. Id. at 188–91. The court added that a contrary interpretation would create an inexplicable conflict with the Federal Arbitration Act. More specifically, a broad grant of federal-court authority to compel discovery in private foreign arbitrations “would stand in stark contrast to” the extremely limited judicial role in domestic arbitrations. Id. at 191. Accordingly, the court held that the statute does not authorize district courts to order discovery for use in private foreign arbitrations. Id.
The Fifth Circuit quickly agreed with that interpretation, Biedermann Int‘l, 168 F.3d at 883, and that‘s where things stood
A few months later, the Fourth Circuit aligned itself with the Sixth Circuit in a case involving a
Finally, and more recently still, the Second Circuit reaffirmed its interpretation of
For several reasons, we side with the Second and Fifth Circuits in this interpretive debate. First, the word “tribunal” is not defined in the statute, and dictionary definitions do not unambiguously resolve whether private arbitral panels are included in the specific sense in which the term is used here. All definitions agree that the word “tribunal” means “a court,” but some are more expansive, leaving room for both competing interpretations.
For example, in 1964 when the present-day version of the statute was adopted, Black‘s Law Dictionary defined “tribunal” as: “The seat of a judge; the place where he administers justice. The whole body of judges who compose a jurisdiction; a judicial court; the jurisdiction which the judges exercise.” Tribunal, BLACK‘S LAW DICTIONARY (4th ed. 1951). That definition appears to exclude private arbitral panels. Today the legal definition of “tribunal” is broader: “A court of justice or other adjudicatory body.” Tribunal, BLACK‘S LAW DICTIONARY (11th ed. 2019).
Nonlegal definitions are similar. See, e.g., Tribunal, THE CONCISE OXFORD DICTIONARY OF CURRENT ENGLISH (5th ed. 1964) (defining “tribunal” as “[j]udgement-seat ... ; court of justice“); Tribunal, WEBSTER‘S NEW TWENTIETH CENTURY DICTIONARY (2d ed. 1964) (defining “tribunal” as “the seat of a judge; ... a court of justice“); Tribunal, AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE (5th ed 2018) (defining “tribunal” as “[a] law court[;] ... [a] committee or board appointed to adjudicate in a particular matter“); Tribunal, MERRIAM-WEBSTER‘S DICTIONARY AND THESAURUS (2020) (defining “tribunal” as “the seat of a judge[;] a court of justice[;] something that decides or determines, [as in] the ~ of public opinion ...“).
C. Statutory Context
As always, context is key to unlocking meaning. After all, statutory words and phrases “cannot be construed in a vacuum. ... It is a fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme.” Home Depot U.S.A., Inc. v. Jackson, 139 S. Ct. 1743, 1748 (2019) (quoting Davis v. Mich. Dep‘t of Treasury, 489 U.S. 803, 809 (1989)). Once we situate the word “tribunal” in its proper statutory context, the more expansive reading of the term—the one that includes private arbitrations—becomes far less plausible.
As we‘ve noted, the language of present-day
The Commission shall investigate and study existing practices of judicial assistance and cooperation between the United States and foreign countries with a view to achieving improvements. To the end that procedures necessary or incidental to the conduct and settlement of litigation in State and Federal courts and quasi-judicial agencies which involve the performance of acts in foreign territory, such as the service of judicial documents, the obtaining of evidence, and the proof of foreign law, may be more readily ascertainable, efficient, economical, and expeditious, and that the procedures of our State and Federal tribunals for the rendering of assistance to foreign courts and quasi-judicial agencies be similarly improved, the Commission shall—
(a) draft for the assistance of the Secretary of State international agreements to be negotiated by him;
(b) draft and recommend to the President any necessary legislation;
(c) recommend to the President such other action as may appear advisable to improve and codify international practice in civil, criminal, and administrative proceedings; and
(d) perform such other related duties as the President may assign.
Act of Sept. 2, 1958, Pub. L. No. 85-906, § 2, 72 Stat. 1743, 1743. Noticeably absent from this statutory charge is any instruction to study and recommend improvements in judicial assistance to private foreign arbitration.
“Six years later, in 1964, Congress unanimously adopted legislation recommended by the Rules Commission,” which “included a complete revision of
Identical words or phrases used in different parts of the same statute (or related statutes) are presumed to have the
Within
The highlighted phrase parallels the earlier phrase “foreign or international tribunal.” Harmonizing this statutory language and reading it as a coherent whole suggests that a more limited reading of
D. Conflict with the Federal Arbitration Act
This narrower understanding of the word “tribunal” avoids a serious conflict with the Federal Arbitration Act (“FAA“),
The discovery assistance authorized by
Moreover, the FAA applies to some foreign arbitrations under implementing legislation for the Convention on the Recognition and Enforcement of Foreign Arbitral Awards and the Inter-American Convention on International Commercial Arbitration.
In sum, what the text and context of
E. Intel and Legislative History
Intel was the Supreme Court‘s first—and to date only—occasion to address
Along the way to this last holding, the Court sketched the legislative history of
(emphasis added) (quoting Hans Smit, International Litigation Under the United States Code, 65 COLUM. L. REV. 1015, 1026 n.71 (1965)).
Servotronics relies heavily on the professor‘s inclusion of “arbitral tribunals” in this footnoted list, but this reliance is misplaced. The quotation from the professor‘s article appears in the Court‘s opinion as part of an explanatory parenthetical. There is no indication that the phrase “arbitral tribunals” includes private arbitral tribunals. Even if there were such an indication, we see no reason to believe that the Court, by quoting a law-review article in a passing parenthetical, was signaling its view that
In short, this passage cannot bear the weight Servotronics places on it. For the foregoing reasons, we join the Second and Fifth Circuits in concluding that
AFFIRMED
Notes
In its broader sense in international practice, the term letters rogatory denotes a formal request from a court in which an action is pending, to a foreign court to perform some judicial act. Examples are requests for the taking of evidence, the serving of a summons, subpoena, or other legal notice, or the execution of a civil judgment. In United States usage, letters rogatory have been commonly utilized only for the purpose of obtaining evidence. Requests rest entirely upon the comity of courts toward each other, and customarily embody a promise of reciprocity.