Ninth Circuit Weighs In On Section 1782 Issue That Has Split Federal Courts

As we’ve previously written (most recently here), 28 U.S.C. § 1782 is a useful federal statute that allows overseas litigants to obtain discovery through U.S. federal courts for use in the overseas litigation.  With respect to adjudication of Section 1782 applications, some federal courts have disagreed about whether such are “dispositive” or “non-dispositive” matters when the application is decided by a federal magistrate judge, as opposed to a federal district judge.  The distinction is relevant because federal district judges review magistrate judges’ reports and recommendations on “dispositive” matters de novo, but review magistrate judges’ rulings on “non-dispositive” matters only to determine whether the ruling was clearly erroneous or contrary to law.[1]

In a recent decision, the Ninth Circuit Court of Appeals held that Section 1782 applications are “dispositive” for purposes of a magistrate judge’s ruling on the issue.[2] The Ninth Circuit reasoned that the matter was “dispositive” because “the magistrate judge’s order denied the only relief sought by [the applicant] in this federal case: court-ordered discovery.” The court distinguished the situation from the types of discovery matters typically heard by a magistrate judge because those discovery matters are usually in the context “of an ongoing civil case in that same federal court for monetary damages, injunctive relief, or the like.” In the Section 1782 context, however, there is no ongoing federal civil case: the Section 1782 application is the only relief sought in, and the only purpose for having commenced, the action.[3]

The Ninth Circuit appears to be the first appellate court to directly address this issue. However, several federal district courts have previously grappled with this question and have reached differing results. For example, federal district courts in California and Nevada (both of which are in the Ninth Circuit), and North Carolina previously held that Section 1782 applications are “discovery matters,” that are “no different in character to [discovery] proceedings [that] are routinely handled by magistrate judges.”[4]  Other courts have struggled more deeply with the conflicting authority.  For example, a magistrate judge sitting in Massachusetts federal court stated that although she was “sympathetic to the view that discovery issues are largely within the purview of magistrate judges,” because “there appears to be conflicting authority” with respect to Section 1782, the magistrate judge declined to “resolve the issue, but rather, in an abundance of caution, . . . issue[d] a report and recommendation” for the district judge’s de novo review.[5]

Federal courts in the Ninth Circuit (Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington) will now treat Section 1782 applications as “dispositive.” Because it appears to be the first appeals court to have directly addressed the issue, federal courts in other circuits may find the Ninth Circuit’s decision persuasive and adopt its view.  It remains to be seen, however, whether all federal courts outside the Ninth Circuit will take that approach, or whether some will continue to treat Section 1782 applications as “non-dispositive.”

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[1] 28 U.S.C. § 636(b). 

[2] In re CPC Patent Technologies PTY Ltd., 34 F.4th 801 (9th Cir. 2022). 

[3] Id. at 807-08. 

[4] Chevron Corp. v. E-Tech Int’l, 2010 U.S. Dist. LEXIS 94, at *9-10 (S.D. Cal. Sept. 10, 2010); see also In re Application of Ilyas Khrapunov, 2018 U.S. Dist. LEXIS 111278 (N.D. Cal. July 3, 2018); In re Macquarie Bank, 2015 U.S. Dist. LEXIS 72544 (D. Nev. May 28, 2015); In re Qwest Communications Int’l, Inc., 2008 U.S. Dist. LEXIS 115845 (W.D.N.C. July 9, 2008). 

[5] In re Peruvian Sporting Goods S.A.C., 2018 U.S. Dist. LEXIS 223564, at *5-7 (D. Mass. Dec. 7, 2018).