O'KEEFFE v. THORELL
OPINION. Signed by Judge William J. Martini on 8/26/15. (gh, )
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
IN RE THE APPLICATION OF KATE
O’KEEFFE FOR ASSISTANCE
BEFORE A FOREIGN TRIBUNAL
Civ. No. 14-5835 (WJM)
WILLIAM J. MARTINI, U.S.D.J.
This matter comes before the Court on an appeal from Magistrate Judge
Mark Falk’s February 10, 2015 decision denying Sheldon Adelson’s motion to
quash Kate O’Keeffe’s application for a subpoena under 28 U.S.C. § 1782(a). For
the reasons set forth below, the appeal is DENIED the Judge Falk’s decision is
Appellee Kate O’Keeffe is a Hong Kong-based reporter for Dow Jones &
Company, Inc. She writes for the Wall Street Journal and its Asian and European
publications. O’Keeffe is a defendant in a libel action in Hong Kong brought by
Appellant Sheldon G. Adelson (“the Hong Kong lawsuit”). The Hong Kong
lawsuit arises from an article written by O’Keeffe and published in the December
7, 2012 edition of the Wall Street Journal. Appellee’s Br. 4, ECF No. 35. In the
article, O’Keeffe referred to Adelson as “foul-mouthed.” Id. at 5.
On September 19, 2014, O’Keeffe filed an ex parte application to serve a
subpoena seeking a deposition and documents from Kirk A. Thorell under 28
U.S.C. § 1782(a). Thorell is a partner with PricewaterhouseCoopers (“PwC”),
which formerly provided auditing services for Adelson’s Las Vegas Sands
Corporation (“LVSC”). PwC resigned, allegedly because of “Adelson’s
‘challenging demeanor and demands on the auditors.’” Id. at 6. O’Keeffe sought
the subpoena for use in her defense in the Hong Kong lawsuit, arguing that Thorell
may have information or documents supporting the notion that Adelson is foulmouthed. Magistrate Judge Mark Falk granted the application but provided
Thorell and Adelson with the opportunity to file motions to quash. Order dated
September 30, 2014, ECF No. 6. Adelson moved to quash the subpoena on
November 11, 2014. Id. Thorell did not file a motion to quash.
On February 10, 2015, Magistrate Judge Falk issued an opinion and order
regarding Adelson’s motion to quash. Judge Falk’s opinion centered on the
discretionary factors discussed in Intel Corp. v. Advanced Micro Devices, Inc., 542
U.S. 241, 264 (2004). Judge Falk found that the Intel factors weighed in favor of
granting the Section 1782 request and denied Adelson’s motion. Adelson now
brings the instant appeal.
STANDARD OF REVIEW
A district court may reverse a magistrate judge’s order if it finds the ruling
to be clearly erroneous or contrary to law. See 28 U.S.C. § 636(b)(1)(A); Fed. R.
Civ. P. 72(a); L. Civ. R. 72.1(c)(1)(A). The district court is bound by the clearly
erroneous rule as to findings of fact, while the phrase “contrary to law” indicates
plenary review as to matters of law. Haines v. Liggett Group Inc., 975 F.2d 81, 91
(3d Cir. 1992). A finding is considered “clearly erroneous” when, “although there
is evidence to support it, the reviewing court on the entire evidence is left with the
definite and firm conviction that a mistake has been committed.” United States v.
United States Gypsum Co., 333 U.S. 364, 395 (1948). A decision is considered
contrary to the law if the magistrate judge has “misinterpreted or misapplied
applicable law.” Doe v. Hartford Life Acc. Ins. Co., 237 F.R.D. 545, 548 (D.N.J.
When an appellant “seeks review of a matter within the purview of the
Magistrate Judge, such as a discovery dispute, an even more deferential standard,
the ‘abuse of discretion’ standard, must be applied.” Koninklijke Philips
Electronics N.V. v. Hunt Control Sys., Inc., No. 11-3684, 2014 WL 5798109, at *2
(D.N.J. 2014) (quoting Salamone v. Carter’s Retail, Inc., No. 09-5856, 2012 WL
821494, at *4 (D.N.J. 2012)). Under this standard, the Magistrate’s discovery
decision is entitled to great deference and is reversed only upon an abuse of
discretion. Halsey v. Pfeiffer, No. 09-1138, 2010 WL 3735702, at *1 (D.N.J.
2010) (citing Kresefky v. Panasonic Commc’n and Sys. Co., 169 F.R.D. 54, 64
The Court will affirm Judge Falk’s decision. Section 1782 provides that
“[t]he 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 . . . .” 28 U.S.C. § 1782(a)
(emphasis added). Thus, even where the statutory requirements are met, the
district court is not required to grant a Section 1782 discovery application. Rather,
it is in the court’s discretion to either approve or deny the application. Intel, 542
U.S. at 264.
In Intel, the United States Supreme Court identified four factors for courts to
consider in exercising their discretion: (1) whether the documents or testimony
sought are within the foreign tribunal’s jurisdictional reach, and, therefore,
accessible in lieu of a Section 1782 application; (2) the nature of the foreign
tribunal, the character of the proceedings, and the receptivity of the foreign
government or court or agency to American federal judicial assistance; (3) whether
the Section 1782 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. Id. at 264-65. The first
Intel factor is not in dispute in this case.
The Court finds that Judge Falk properly considered the disputed Intel
factors and that his decision denying the motion to quash was not an abuse of
discretion. As to the second Intel factor, the moving party must present
authoritative proof that the foreign court would reject the evidence obtained with
the aid of Section 1782. Euromepa S.A. v. R. Esmerian, Inc., 51 F.3d 1095, 1100
(2d Cir. 1995). Examples of authoritative proof include “a forum country’s
judicial, executive or legislative declarations that specifically address the use of
evidence gathered under foreign procedures.” Id.
Here, the record contains no authoritative proof that the Hong Kong court
would be unreceptive to the District of New Jersey’s assistance. Rather, the record
merely contains two differing interpretations of Hong Kong law from the parties’
respective experts. As Judge Falk correctly noted, district courts are discouraged
from engaging in the interpretation of foreign law when conducting a Section 1782
analysis. See In re Application of Imanagement Servs. Ltd., No. 05-2311, 2006
WL 547949, at *2 (D.N.J. Mar. 3, 2006) (“The [Supreme] Court [in Intel] warned
against interpreting § 1782 so as to require the United States courts to analyze
foreign legal rules and systems . . . .”); Euromepa, 51 F.3d at 1099 (“[I]t is unwise
. . . for district judges to try to glean the accepted practices and attitudes of other
nation from are likely to be conflicting . . . and biased interpretations of foreign
law.”). Further, the Hague Evidence Convention is in effect between the United
States and Hong Kong, which indicates that Hong Kong’s courts are receptive to
American judicial assistance. See In re Application of Imanagement Servs. Ltd.,
2006 WL 547949, at *4; In re Servicio Pan Americano de Proteccion, 354 F.
Supp. 2d 269, 274 (S.D.N.Y. 2004).
Moving to the third Intel factor, the record lacks any indication that
O’Keeffe is attempting to evade restrictions on discovery in Hong Kong. Adelson
argues that Judge Falk should have inferred circumvention based on O’Keeffe’s
decision to pursue discovery through Section 1782 rather than letters rogatory.
However, courts have repeatedly found that Section 1782 applicants are not
required to apply for letters rogatory through the forum nation before making a
Section 1782 application. See, e.g., In re Bayer AG, 146 F.3d 188, 196 (3d Cir.
1998) (citing In re Malev Hungarian Airlines, 964 F.2d 97, 100 (2d Cir. 1992).
Adelson’s argument that Judge Falk was required to at least consider O’Keeffe’s
decision not to seek a letter rogatory in Hong Kong is likewise unavailing. Though
a court may consider such evidence in making its discretionary finding, there is no
requirement that a court must do so. See In re Application of Caratube Int’l Oil
Co., 730 F. Supp. 2d 101, 107 (D.D.C. 2010) (quoting In re Application of
Babcock Borsig AG, 583 F. Supp. 2d 233, 241 (D. Mass. 2008) (“[T]he district
court may, in its discretion, properly consider a party’s failure first to attempt
discovery measures in the foreign jurisdiction.”).
Finally, as to the fourth Intel factor, nothing in the record indicates that
O’Keeffe’s request was either unduly burdensome or unduly intrusive. As an
initial matter, courts have repeatedly held that movants do not have standing to
challenge discovery as unduly burdensome where the burden falls on a third party.
See, e.g., PKFinans Int’l Corp. v. IBJ Schroder Leading Corp., No. 93-5375, 1996
WL 525862, at *4 (S.D.N.Y. 2003) (“IBJ does not have standing to contest the
subpoena on the grounds that it . . . imposes an undue burden since it is not IBJ’s
employees that would be burdened by the production but the [third party’s]
employees.”). Here, any burden imposed by O’Keeffe’s requested subpoena falls
squarely on Thorell and/or PwC.
Additionally, Adelson’s confidentiality concerns do not render the Section
1782 request unduly intrusive. See In re Ex Parte Apple Inc., No. 12-80013, 2012
WL 1570043, at *3 (N.D. Cal. 2012) (finding that confidentiality concerns do not
pertain to the intrusiveness of the requested subpoena where no legal privilege is
invoked). Courts have repeatedly found that there is no accountant-client privilege
under federal law. See, e.g., Couch v. United States, 409 U.S. 322, 335 (1973).
And as Judge Falk correctly noted, any concerns about the potential disclosure of
confidential information can be alleviated through protective orders. Thus, Judge
Falk did not abuse his discretion in denying Adelson’s motion to quash the Section
For the above reasons, the appeal is DENIED and Judge Falk’s decision is
AFFIRMED. An appropriate order follows.
/s/ William J. Martini
WILLIAM J. MARTINI, U.S.D.J.
Date: August 26, 2015
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