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In re Application of Grynberg

United States District Court, S.D. New York

May 15, 2017


          OPINION & ORDER


         Applicants Jack J. Grynberg, Grynberg Production Corp. (TX), Grynberg Production Corp. (CO), and Pricaspian Development Corp. (collectively, “Grynberg”)[1] bring this application for an order under 28 U.S.C. § 1782 to conduct discovery for use in civil proceedings in Switzerland (the “Swiss Proceedings”). Grynberg seeks permission to serve document subpoenas on James Giffen, the Mercator Corporation, and Cooley LLC, as well as a deposition subpoena on Giffen. The defendants in the Swiss Proceedings-Phillips 66 GmbH, Total (Suisse) S.A., and Eni Suisse S.A. (the “Swiss Defendants”)-oppose the application. For the reasons that follow, Grynberg's application is denied.


         This application arises from Grynberg's continued efforts to recover a 20% stake in a major oil field located in the Caspian Sea near Kazakhstan. Grynberg is an investor and oil-and-gas prospector by trade who is familiar to this Court.[2] Over the last fifteen years, Grynberg and his corporate entities have been plaintiffs in more than two hundred federal lawsuits, most of which concerned the same subject matter undergirding the Swiss Proceedings in this case.

         In the early 1990s, Grynberg was involved in oil and natural-gas exploration in the territorial waters of Kazakhstan. Grynberg alleges in his many lawsuits that he discovered significant oil and gas resources in the Caspian Sea, and attempted to form a consortium with several western oil companies (including the parent corporations of the Swiss Defendants) to exploit those resources. Grynberg claims that those oil companies, with the aid of James Giffen, appropriated his research and conspired to bribe Kazakh government officials to secure production rights while cutting Grynberg out of the transaction. Grynberg asserts he would otherwise have been entitled to 20% of the profits from exploitation of the field.[3] Each of these suits-one of which came before this Court-were dismissed.

         Having been rebuffed in American courts, Grynberg appears to have turned his sights abroad. In addition to the Swiss Proceedings that form the basis of this application, Grynberg recently filed a lawsuit in the Netherlands against Eni S.p.A. and Eni International B.V. (See Eni Suisse's Opposition, ECF No. 16, at 7.) The Dutch court dismissed that case, which asserted the same claims Grynberg intends to prosecute in Switzerland. In rejecting his claims, the Dutch court held that Grynberg “[did] not substantiate [his] assertions factually and specifically in any way, ” and imposed sanctions of more than €300, 000 against him. (Eni Suisse Opp. at 7.)

         The Swiss Proceedings are at different stages, as Swiss law requires a conciliation period before a plaintiff can file a civil suit. The most advanced action, filed in April 2014, is against Phillips 66. Grynberg also filed separate proceedings against Eni Suisse and Total (Suisse) later in 2014, but failed to file timely Statements of Claim in those cases following the conciliation period. Grynberg claims to have reinstated those cases in March 2017, and intends to file Statements of Claim once he receives authorization from the Swiss court.

         In all three cases, Grynberg alleges that the Swiss Defendants are responsible for the tortious conduct of their corporate parents-that is, conspiring with Giffen's “Consortium” to steal Grynberg's confidential information and secure the Kazakh production contracts-because the Swiss Defendants transport and sell oil extracted from the Kazakh field. He brings this discovery application to obtain information and documents from Giffen, Giffen's corporation, and Giffen's counsel regarding the Swiss Defendants' participation in the alleged bribery scheme.


         A discovery application under 28 U.S.C. § 1782 “presents two inquiries: first, whether the district court is authorized to grant the request; and second, if so, whether the district court should exercise its discretion to do so.” In re Application of Grupo Qumma, No. M 8-85, 2005 WL 937486, at *1 (S.D.N.Y. April 22, 2005). “A district court has authority to grant a § 1782 application where: (1) the person from whom discovery is sought resides (or is found) in the district of the district court to which the application is made, (2) the discovery is for use in a foreign proceeding before a foreign [or international] tribunal, and (3) the application is made by a foreign or international tribunal or any interested person.” Mees v. Buiter, 793 F.3d 291, 297 (2d Cir. 2015) (internal quotations omitted).

         Once the Court determines that it has the statutory authority to grant the application, it must further decide whether to exercise its discretion to do so “in light of the twin aims of the statute: providing efficient means of assistance to participants in international litigation in our federal courts and encouraging foreign countries by example to provide similar means of assistance to our courts.” Schmitz v. Bernstein Liebhard & Lifshitz, LLP, 376 F.3d 79, 84 (2d Cir. 2004). The Supreme Court has identified four “factors that bear consideration” in exercising this discretion: (1) whether “the person from whom discovery is sought is a participant in the foreign proceeding, ” in which case “the need for § 1782(a) aid generally is not as apparent”; (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 § 1782(a) 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).


         In this case, the parties do not dispute that Giffen, the Mercator Corporation, and Cooley are located in this district or that Grynberg is an “interested person” in the Swiss proceedings. The parties disagree as to whether this discovery is sought “for use” in a foreign proceeding and whether the Intel factors weigh in favor of the application.

         A. “For Use” in ...

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