Randall et al v. Offplan Millionaire AG et al

MOTION to Compel Joachim Oliver Nedela to Respond to Plaintiffs' Jurisdictional Discovery, and Request for Oral Argument, and Supporting Memorandum of Law

M.D. Fla.January 28, 2019

1 UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA ORLANDO DIVISION NICHOLAS J. RANDALL and FAN FENG, Plaintiffs, v. OFFPLAN MILLIONAIRE AG d/b/a PRIME ASSET INVESTMENTS LTD.; CAPINVEST LLC; JOACHIM OLIVER NEDELA; STEPHEN JORDAN-QUAYLE a/k/a STEPHEN JORDAN; CARL DHIR a/k/a CARL DEAR; CRESCENT REAL ESTATE MANAGEMENT, INC.; DANIEL J. DORAN, JR.; and LUCRETIA L. DORAN, Defendants. / CASE NO.: 6:17-cv-2103-Orl-31TBS ORAL ARGUMENT REQUESTED PLAINTIFFS' MOTION TO COMPEL JURISDICTIONAL DISCOVERY FROM DEFENDANT JOACHIM OLIVER NEDELA AND REQUEST FOR ORAL ARGUMENT AND SUPPORTING MEMORANDUM OF LAW Plaintiffs, Nicholas J. Randall ("Randall") and Fan Feng ("Feng") (collectively "Plaintiffs"), by and through their undersigned counsel, pursuant to Federal Rule of Civil Procedure 37 and Local Rules 3.01(j) and 3.04(a),1 hereby move this Court to compel Defendant Joachim Oliver Nedela ("Nedela") to provide jurisdictional discovery. After initially agreeing to provide discovery, and obtaining an extension of deadlines on the representation that more time was needed to prepare assembled documents for production, 1 Every single interrogatory and request for production included in Plaintiffs' pending jurisdictional discovery requests (copies at ECF No. 64-4) is the subject of this request to compel because Nedela has not objected or responded to any of them. Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 1 of 26 PageID 719 2 Nedela now insists on discovery being taken in Switzerland pursuant to the Hague Convention On the Taking of Evidence Abroad In Civil Or Commercial Matters (the "Hague Convention procedures") and refuses to comply in any way with the pending jurisdictional discovery unless Plaintiffs submit to the Hague Convention procedures. However, United States precedent permits full discovery in the United States, and it supports that the Hague Convention procedures are optional and would unduly protract and restrict discovery that is both proper under the Federal Rules of Civil Procedure and essential to determining the existence of personal jurisdiction over Nedela. Plaintiffs submit that oral argument or, in the alternative, a status conference, would assist the Court and parties in resolving these issues. In support of this Motion, Plaintiffs state as follows: I. Procedural Background On August 17, 2018, Nedela filed his Motion to Dismiss arguing, inter alia, this Court lacks personal jurisdiction over him. (ECF No. 56.) In his accompanying declaration, Nedela attested that he had nothing to do with the scheme alleged; he was not involved in day-to-day operations; he never hired or had any relationship with the other individual defendants; was never aware of communications with Plaintiffs; and had a merely nominal role in the entity Offplan Millionaire AG. (E.g., ECF No. 56-1 at 7-8.) Plaintiffs filed their Consolidated Preliminary Response on September 12, 2018, which included a request for jurisdictional discovery. (ECF No. 64.) On September 12, 2018, Plaintiffs served on Nedela their First Set of Interrogatories Concerning Personal Jurisdiction and First Request for Production of Documents Concerning Personal Jurisdiction. (ECF No. 64-4.) Plaintiffs also served a notice of deposition on Nedela without Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 2 of 26 PageID 720 3 specifying a date or place therein, but simultaneously requesting deposition dates and offering to take the deposition at any location and any time convenient to Nedela. On September 26, 2018, Nedela responded in opposition to Plaintiffs' request to conduct jurisdictional discovery. (ECF No. 65.) In his opposition filing, Nedela argued that Plaintiffs were not entitled to take jurisdictional discovery but did not raise any other specific objections to the discovery requested. (See id.) Nedela also did not timely serve any objections to the pending jurisdictional discovery, and has never served any objections or responses to Plaintiffs' discovery. On October 23, 2018, the Court entered an Order granting Plaintiffs' motion for jurisdictional discovery and stayed their response to Nedela's Motion to Dismiss for forty- five days "during which time they may engage in discovery that is limited to the jurisdictional issues raised by Nedela." (ECF No. 66 at 11.) The Court recognized that "Plaintiffs are entitled to obtain the limited jurisdictional discovery sought for the purpose of responding to Nedela's motion to dismiss." (Id.) On November 13, 2018, Plaintiffs and Defendant Nedela jointly moved for an extension of the time to complete jurisdictional discovery and the deadline for Plaintiffs to respond to Nedela's Motion to Dismiss. (ECF No. 67.) That request was premised on the fact that Nedela had gathered more than 6,000 documents to review for responsiveness to Plaintiffs' discovery requests and the difficulty in clearing a mutually convenient day to hold Nedela's deposition. (Id. at 2) ("Documents gathered for review for responsiveness to Plaintiffs’ jurisdictional document request exceed 6,000 in number, which requires adequate time both for processing by Nedela’s counsel and for meaningful review by Plaintiffs’ Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 3 of 26 PageID 721 4 counsel in advance of the deposition of Nedela.") The Court granted the joint request of the parties to require Nedela to respond to the jurisdictional interrogatories and requests to produce by November 27, 2018, and to appear for deposition the week of December 17, 2018, as well as to require Plaintiffs to respond to the Motion to Dismiss by January 10, 2019. (Id. at 3; ECF No. 69 at 1.) On November 27 and 30, 2018, Defendant Nedela for the first time informed the Court of certain alleged obstacles to conducting the jurisdictional discovery under Swiss law and sought relief from the jurisdictional discovery deadlines. (See ECF No. 70, 71). The Legal Opinion Letter from Nedela's Swiss attorney reflects that his opinion was requested (at least formally) only the day before, November 26, 2018. (ECF No. 70-1 at 1.) On December 3, 2018, the Court denied, without prejudice, an additional extension of time based on Defendant Nedela's request, noting that "[t]he Court does not know Swiss law or how it impacts jurisdictional discovery in this case." (ECF No. 72 at 1.) The Court added that it "does not now intend to strictly enforce the discovery deadline established in its Order," but further instructed that "[w]hen the parties better understand the situation in Switzerland, including the sequence, timing, and results of actions there, they should update the Court which will, when it has more concrete information, entertain a motion to enlarge the time for jurisdictional discovery." (Id. at 1-2.) On January 10, 2019, Plaintiffs sought an additional brief extension of time through January 22, 2019 (ECF No. 73), which the Court granted (ECF No. 74). On January 22, 2019, the parties filed a Joint Notice of Impasse Regarding Jurisdictional Discovery (ECF No. 75), advising the Court of the impasse of their negotiations to conduct jurisdictional Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 4 of 26 PageID 722 5 discovery of Nedela and briefly summarizing the parties' respective positions. At present, given the parties' differing positions on how best to complete jurisdictional discovery, Plaintiff is unable to identify a timeline to complete the pending discovery or to substantively respond to Nedela's Motion to Dismiss for lack of personal jurisdiction. Regardless, it appears certain that compliance with the Hague Convention procedures will impact the current Case Management and Scheduling Order, as the next deadline (disclosure of Plaintiffs' expert reports) is set for June 12, 2019 and discovery on the merits is set to close on August 2, 2019. (ECF No. 60 at 1.) II. Relevant Factual Background The Court granted jurisdictional discovery to resolve a genuine dispute of fact necessary to decide the question of personal jurisdiction and to inform the Court's decision as to the existence of jurisdiction and the merits of the case. (ECF No. 66, at 10.) Yet, as of this filing, no jurisdictional discovery has been completed. Plaintiffs have not received any substantive responses to any of the interrogatories or documents requests served on Nedela on September 12, 2018, nor any dates to depose Nedela. The parties are unable to agree to a process that is both timely and that ensures full compliance with the requested discovery. Both sides engaged their own separate attorneys in Switzerland, who have advised each side respectively, and have conferred directly, on the procedures imposed by Swiss law on the taking of evidence. The parties' respective Swiss attorneys have provided legal opinion letters that have been submitted to the Court. (See ECF Nos. 75-1, 75-2, 75-3, 75-4.) However, the parties' counsel have reached differing conclusions about the most appropriate and efficient means to proceed with the pending discovery. Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 5 of 26 PageID 723 6 Nedela broadly claims that participating in the requested jurisdictional discovery would expose him, his counsel, and Plaintiffs' counsel to criminal liability under Swiss law. Notably, the premise of these claims is that discovery will or must be effectual in Switzerland. From this premise, Nedela insists that Plaintiffs must follow the procedures set forth in the Hague Convention procedures to conduct the pending discovery. (See ECF No. 75 at 7-9.) As Plaintiffs' Swiss counsel has explained, it is common for parties to conduct discovery from United States litigation outside of Switzerland in another county, like England, that does not have a "blocking statute" (laws restricting the taking of evidence on behalf of a foreign state) like Switzerland.2 This alternative requires mutual agreement, which Nedela's Swiss counsel flatly "dismisses." (ECF No. 75-4 at 1.) Significantly, the parties' Swiss counsel have offered very different opinions about the likely length of the delay introduced by Nedela's demand to comply with the Hague Convention procedures to conduct jurisdictional discovery. Nedela's Swiss counsel has opined that compliance with the Hague Convention procedures would take around two months. To the contrary, it is the opinion and experience of Plaintiffs' Swiss counsel that obtaining service of the discovery requests and deposition notice by the Swiss authorities through the Hague Convention procedures in itself, takes approximately 3-6 months. (ECF No. 75-1 at 2.) Plaintiffs' Swiss counsel has also warned that once Nedela is served through the Swiss authorities, he has the opportunity to object to the scope of the discovery requests under Swiss law (which is stricter than United States discovery law), and any objection 2 Plaintiffs' discovery requests cite the location of the production as Orlando, Florida or "such alternative location as the parties may agree" (see ECF No. 64-4 at 10), and Plaintiffs' notice of deposition served on Nedela intentionally did not specify a location so that the parties could find a mutually convenient site in order to expedite the process. Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 6 of 26 PageID 724 7 would take up to an additional one to two-and-a-half years to be resolved by the Swiss judicial system. (Id. at 3.) In addition, Plaintiffs' Swiss counsel has advised that compliance with the Hague Convention procedures would not allow Plaintiffs to take jurisdictional discovery in the form and scope it has been requested. (See id.) III. Legal Standards for Motion to Compel Discovery is intended to operate with minimal judicial supervision unless a dispute arises and one of the parties files a motion requiring judicial intervention. S.L. Sakansky & Assocs., Inc. v. Allied Am. Adjusting Co. of Fla., LLC, No. 3:05-cv-708-32MCR, 2007 WL 2010860, *1 (M.D. Fla. Jul. 6, 2007). Furthermore, according to the Middle District guidelines, "[d]iscovery in this district should be practiced with a spirit of cooperation and civility." Middle District Discovery (2015) at 1. Under Rule 37, if a party fails to respond to an interrogatory or request for production, or fails to attend a deposition, the party seeking the discovery may file a motion to compel such response or attendance. Fed. R. Civ. P. 37(a)(3)(B)(i)-(iv), (d)(1)(A). The party resisting discovery bears the burden of demonstrating specifically how any objected-to request is unreasonable or otherwise unduly burdensome. Oliver v. City of Orlando, No. 606CV-1671-ORL-31DAB, 2007 WL 3232227, at *1-2 (M.D. Fla. Oct. 31, 2007) (citations omitted). "The resisting party must make a particular and specific demonstration of fact and cannot rely on simply conclusory assertions about the difficulty of complying with a discovery request." Wagner v. Viacost.com, No. 06-81113-CIV, 2007 WL 1879914, at *1 (S.D. Fla. June 29, 2007) (citation and internal quotation marks omitted). Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 7 of 26 PageID 725 8 "Motions to compel discovery under Rule 37(a) of the Federal Rules of Civil Procedure are committed to the sound discretion of the trial court." Blue Heron Commercial Group, Inc. v. Lee Webber & Gerald T. Filipiak, No. 2:18-CV-467-FTM-29CM, 2018 WL 6045252, at *2 (M.D. Fla. Nov. 19, 2018) (citing Commercial Union Ins. Co. v. Westrope, 730 F.2d 729, 731 (11th Cir. 1984)). IV. Legal Analysis Defendant Nedela is insisting that Plaintiffs must comply with the Hague Convention procedures as the only means of proceeding with the pending jurisdictional discovery, which has already been authorized by this Court, while Plaintiffs believe the Hague Convention procedures are not only unnecessary but will add unjustified delays and limitations to the discovery. Plaintiffs submit there is ample authority supporting this Court's jurisdiction to enforce jurisdictional discovery in the United States over Nedela. Plaintiffs also request oral argument or, in the alternative, a status conference to address these jurisdictional discovery issues, which almost certainly also will apply to discovery on the merits in this case. A. Defendant Nedela Bears The Burden Of Demonstrating That Swiss Law Bars This Discovery. 1. Nedela has made no showing of or offered evidence of any real threat of prosecution under Swiss law. The party relying on foreign law bears the burden of demonstrating that such law actually bars the production or testimony at issue. E.g., United States v. Vetco, Inc., 691 F.2d 1281, 1289 (9th Cir. 1981); Roberts v. Heim, 130 F.R.D. 430, 436 (N.D. Cal. 1990); Alfadda v. Fenn, 149 F.R.D. 28, 34 (S.D.N.Y. 1993). "In order to meet that burden, the party resisting discovery must provide the Court with information of sufficient particularity and Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 8 of 26 PageID 726 9 specificity to allow the Court to determine whether the discovery sought is indeed prohibited by foreign law." Alfadda, 149 F.R.D. at 34.3 In practice, courts have found that the producing party cannot merely cite foreign law that may bar discovery, but instead must show how the production would actually violate foreign law, how the foreign government has threatened criminal prosecution, or that the foreign judiciary has refused to allow such discovery. E.g., Roberts, 130 F.R.D. at 436. For example, in Roberts, the district court looked beyond the defendant's claim that Swiss law would make cooperation criminal and granted a motion to compel a Swiss national to appear for deposition in the United States and to produce documents and written discovery in the United States. Id. The court found prosecution very unlikely under Articles 273 (prohibiting disclosure of "business secrets," which Nedela has raised in blanket fashion). Id. at 436, 438 (noting that the Supreme Court rejected the argument in the Swiss government's amicus curiae brief in Aerospatiale that foreign discovery would compel a violation of Article 273 of Swiss law). Significantly, it found that, according to the Swiss Attorney General, "Article 273 does not prohibit a person from divulging his own business affairs but only from divulging the business affairs of others without their consent. [Defendant] has made no showing that he is protecting any interest but his own." Id. at 436 (further noting that no other person or entity filed a declaration claiming the requested discovery would infringe the third party's interest, and that a protective order would sufficiently protect the confidentiality of the discovery). Defendant Nedela's submissions to the Court regarding this issue thus far (see ECF 3 Similarly, Federal Rule of Civil Procedure Rule 26(c) requires a party seeking a protective order demonstrate "good cause," which requires particularity, for issuance of an order. Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 9 of 26 PageID 727 10 Nos. 70, 71, 75, 75-2, 75-3, 75-4) do not meet this burden. Defendant Nedela has not provided Plaintiffs with any support for his claims of potential criminal liability, other than his counsel citing to two Swiss laws generally: Article 271 and Article 273 of the Swiss Criminal Code. (See, e.g., ECF Nos. 75-2, 75-3.) While Plaintiffs do not deny that the Swiss laws cited by Nedela exist, Plaintiffs do dispute both the existence of a legitimate threat of prosecution and the laws' applicability to the actual discovery requested here. Nedela must make a specific factual showing that Swiss law actually bars the requested production and deposition or actually subjects him or his counsel to potential criminal liability or threat of criminal prosecution. It is Plaintiffs' position that even if there is no way to 100% guarantee that conducting the discovery (producing the documents and sitting for deposition) outside of Switzerland will not violate these Swiss laws, Plaintiffs are unaware of any actual precedent in Switzerland—and Nedela's counsel has offered none—of any person being criminally prosecuted for engaging in discovery, particularly outside of Switzerland. Indeed, several U.S. courts have noted that no Swiss judicial opinions have surfaced for a party being prosecuted under this law. E.g., EFG Bank AG v. AXA Equitable Life Ins. Co., No. 17-CV-4767 (JMF), 2018 WL 1918627, at *2 (S.D.N.Y. Apr. 20, 2018). In that 2018 case, the district court noted: Decisions of the Swiss Federal Department of Justice and Police ("FDJP")— an administrative, non-judicial body—indicate that Swiss law does not preclude the voluntary production of documents by a private party and that "voluntary" is defined broadly to include the production of discovery so long as the party faces only procedural consequences rather than criminal sanctions for its failure to produce. Id. (refusing to reconsider order denying protective order to require Hague Convention procedures be followed to obtain document production from a Swiss party). Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 10 of 26 PageID 728 11 Given that the issue of compelling discovery from foreign (including Swiss) nationals has come up regularly in United States courts, and that United States courts have routinely compelled discovery in those situations, it is telling that there appears to be no instances of Swiss prosecution in these circumstances. 2. Nedela has made no showing of or offered evidence that Swiss law specifically bars production of the information or documents requested by Plaintiffs. In addition, Nedela has not offered any explanation, analysis, or legal authority as to how or why those Swiss laws would apply in this situation. Plaintiffs have genuine doubts that they would apply and would place either party or their counsel in jeopardy of criminal prosecution by Swiss authorities, especially if discovery was conducted outside of Switzerland. Fundamentally, the November 27, 2018 Legal Opinion Letter of Nedela's Swiss counsel in itself does not clearly demonstrate that the pending jurisdictional discovery is subject to Swiss penal laws. (See ECF No. 70-1, 75-2). For example, Nedela's Swiss counsel assumed that the parties were "collect[ing] evidence in Switzerland" and that "Plaintiffs intend to take evidence in Switzerland" (emphasis added), but that is not true. (Id. at 1.) The Letter explains that Article 271 prohibits discovery activities "on Swiss territory," which, again, is not the case here—or need not be the case as Plaintiff has not demanded either a deposition or document production in Switzerland. (Id. at 2.) Only Nedela has made that demand. Moreover, Nedela's Swiss counsel use of vague language in describing the applicability of two Swiss laws, Article 271 and Article 273 of the Swiss Criminal Code, to this case is inadequate to meet his burden. (See, e.g., ECF Nos. 75-2, 75-3, 75-4.) While he Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 11 of 26 PageID 729 12 warns in his Legal Opinion Letter that "any person who makes a manufacturing or trade secret available to an external official agency a foreign organization or a private enterprise is liable to a custodial sentences [sic]" (ECF No. 75-2 at 2), it is not asserted that the documents in Nedela's possession, custody, or control requested by Plaintiffs actually contain manufacturing or trade secrets. This blanket assertion is not supported by any declaration or other evidence or specifics, and no privilege log has been provided or offered. There is no way for Plaintiffs or this Court to evaluate this broad objection. Similarly, while Nedela's Swiss counsel asserts that a production without a waiver or redaction of such sensitive information would risk prosecution in Switzerland for unlawful data delivery (id. at 2), Nedela's counsel has not identified the third party(s) affected and has not represented that a waiver cannot be obtained from the third party or redactions cannot be made. Notably, Nedela's United States counsel has represented that they reviewed around 6,000 potentially responsive documents between the first request for extension of time on November 13, 2018 and their notice to the Court on November 27, 2018, raising this issue of Swiss law4—so Nedela's counsel knows or should know exactly what those documents contain and whether they are actually subject to these Swiss laws. (ECF No. 67 at 2.) Yet neither Nedela's Legal Opinion Letters nor his recent Court filings specifically allege facts demonstrating how Swiss law would be violated in this case, or allege that Nedela could not have obtained such a waiver or perform such redactions in the intervening nine weeks since obtaining that opinion. This makes the lack of specific assertions of the applicability of 4 Nedela's United States counsel has also represented in December 2018 that Nedela's Swiss counsel was provided some or all of the 6,000 documents for review, which particularly leaves this noticeable lack of specific assertions of the applicability of Swiss law inadequate to meet Nedela's burden. Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 12 of 26 PageID 730 13 Swiss law particularly conspicuous. Nedela's appearance to defend this case in this District makes him subject to the jurisdiction of this Court for purposes of, at the very least, jurisdictional discovery and jurisdictional rulings. Precedent is clear that Nedela bears the burden of showing that the pending discovery is effectively barred by Swiss law, and he has not done so. Other than vague assertions about the possibility of liability under Swiss law, Nedela has not offered any legal authority or specific facts to demonstrate that Swiss law would apply in these circumstances or present a realistic threat of prosecution, or that conducting the discovery outside Switzerland would not relieve these concerns. B. Hague Convention Procedures Are Not Necessary, Warranted, or Efficient. 1. United States courts have held Hague Convention procedures are optional and are skeptical of their applicability and practicality. Precedent supports that the Hague Convention does not deprive the district court of its jurisdiction to order, pursuant to the Federal Rules of Civil Procedure, a foreign party to produce evidence physically located within a signatory nation, such as Switzerland. There is U.S. Supreme Court and Middle District of Florida precedent that the Hague Convention procedures are optional. See Societe Nationale Industrielle Aerospatiale v. United States Dist. Court for So. Dist. of Iowa, 482 U.S. 522, 536, 540-41, 107 S.Ct. 254, 296 L.Ed.2d 461 (1987) ("Aerospatiale"); accord Zamperla, Inc. v. I.E. Park SrL, No. 613CV1807ORL37KRS, 2014 WL 12614505, at *5 (M.D. Fla. Nov. 3, 2014); In re Photochromic Lens Antitrust Litig., No. 8:10-MD-2173-T-27EAJ, 2012 WL 12904331, at *3 (M.D. Fla. May 2, 2012) ("The Hague Convention does not provide the exclusive or even preferred method for obtaining discovery from foreign individuals."); accord Roberts, 130 Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 13 of 26 PageID 731 14 F.R.D. at 438. Specifically, the Supreme Court has found that the Hague Convention sets forth "optional" procedures for obtaining evidence abroad. Aerospatiale, 482 U.S. at 541-46. It is well-settled that "the Federal Rules of Civil Procedure remain the 'normal method [] for federal litigation involving foreign national parties' unless the facts of a given case "indicate the 'optional' or 'supplemental' Convention procedures prove to be conducive to discovery.'" Schindler Elevator Corp. v. Otis Elevator Co., 657 F. Supp. 2d 525, 528 (D.N.J. 2009) (emphasis in original) (quoting In re Automotive Refinishing Paint Antitrust Litig., 358 F.3d 288, 299 (3d Cir. 2004), and Aerospatiale, 482 U.S. at 536). In the Aerospatiale case, the Supreme Court evaluated a French penal code provision, similar to the Swiss blocking law at issue here, in finding that the Hague Convention does not deprive the District Court of its jurisdiction to order, under the Federal Rules of Civil Procedure, a foreign party to produce evidence physically located within a signatory nation. Id. at 541-46. The Hague Convention was intended to establish "optional procedures" for obtaining evidence abroad. Id. at 541. Ultimately, determining whether to resort to optional Hague Convention procedures requires scrutiny in each case of the particular facts, sovereign interests, and likelihood that the Convention procedures will prove effective. Id. at 544. Several opinions within the Eleventh Circuit, including the Southern District of Florida, rely on Aerospatiale on this point, including one involving a deposition of a Swiss national who was ordered to appear pursuant to the Federal Rules of Civil Procedure. E.g., Calixto v. Watson Bowman Acme Corp., No. 07-60077-CIV, 2008 WL 4487679, at *3 (S.D. Fla. Sept. 29, 2008). There are numerous other district court rulings around the country that Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 14 of 26 PageID 732 15 reaffirm that the Hague Convention procedures are optional. See, e.g., Schindler Elevator, 657 F. Supp. 2d at 528; Roberts, 130 F.R.D. at 435-37 (ruling it unnecessary to go through the Hague Convention procedures to obtain deposition, written, and document discovery in a global conspiracy case); EFG Bank AG, 2018 WL 1918627, at *2 (denying protective order to require Hague Convention procedures be followed to obtain document production from Swiss party"). It is readily apparent from the decisions of United States courts that they are uniformly skeptical of defendants' pleas to require Hague compliance where there is an established precedent that the Hague Convention procedures are optional. Given how easily that the Hague Convention procedures can create substantial delays and impose new restrictions on the scope of discovery, there is a recognized risk that requiring Hague compliance upon defendant's mere insistence is ripe for abuse that can stymie the United States legal system and prejudice plaintiffs. 2. Hague Convention Procedures would cause undue delay. Moreover, complying with the Hague Convention is fraught with delays and limitations. As United States courts have recognized, Hague Convention procedures typically take longer and require more hurdles, which makes them less conducive than the Federal Rules of Civil Procedure. Schindler Elevator, 657 F. Supp. 2d at 527. At best, it injects uncertainty about how much longer it will take to complete this preliminary jurisdictional discovery. Such delay will almost assuredly impact the Scheduling Order in this case. Plaintiffs previously submitted a legal opinion letter from their Swiss counsel identifying the delays Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 15 of 26 PageID 733 16 and restrictions imposed by the Hague Convention. (ECF No. 75-1.) In his experience as a Swiss litigator, the single step of obtaining service of the discovery requests and deposition notice by the Swiss authorities through the Hague Convention procedures takes approximately three to six months.5 (Id. at 2.) This estimate does not even take into account any other steps in the process, such as obtaining letters rogatory from this Court, translating into German the application to the Swiss authorities and the discovery requests and discovery order themselves, the additional time for Nedela to respond after service, and the like. (Cf. id. at 2-3.) Plus, if Nedela chooses to object to the scope of the discovery requests under Swiss law—and it is obvious that he will do so6—then any objection would take an additional one to two-and-a-half years to be resolved by the Swiss judicial system. (Id. at 3.) Nedela's counsel, without estimating the length of such a delay, characterizes this delay as "negligible" by "international standards." (ECF No. 75-4 at 2.) The protracted delays from complying with the Hague Convention procedures are not merely hypothetical but are highly probable in this case. After all, Nedela had apparently gathered 6,000 potentially relevant documents and was poised to produce them (after having the discovery requests for nearly two-and-a-half months, and 35 days into the original 45-day period to conduct jurisdictional discovery) when he then raised these Swiss law issues at the eleventh hour before the response deadline. Although he identified these issues months ago, he has not specifically informed Plaintiffs which requests may be objectionable under Swiss 5 That in itself poses a problem with the August 2, 2019 discovery deadline (which includes all fact discovery on the merits, not just jurisdictional discovery). (ECF No. 60 at 1.) 6 Nedela's recent position statement (ECF No. 75 at 7-9) and the January 18, 2019 letter from his Swiss counsel (ECF No. 75-4) make clear that his counsel deems the entirety of Plaintiffs' discovery to risk violating Swiss law and advise Nedela against complying with the pending discovery. Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 16 of 26 PageID 734 17 law or sought to negotiate any narrower scope of those requests. Nor has he offered to voluntarily produce any personal papers or stated that there are none. Furthermore, he has not offered to waive objections under Swiss law to the requests, even though it is Plaintiffs' understanding that the Swiss authorities will not sua sponte review and restrict discovery requests unless the producing party objects. At bottom, Nedela has offered no compromises and rejected outright all of Plaintiffs' proposed compromises. Despite Nedela's professed desire to cooperate "but for" Swiss law (see, e.g., ECF No. 75-4 at 1), his actions tell a different story and create genuine and objectively reasonable concern in Plaintiffs that Nedela will engender delay at any opportunity. 3. Hague Convention procedures would likely result in limiting scope of pending discovery requests beyond Federal Rules of Civil Procedure. Furthermore, Plaintiffs are unwilling to unnecessarily subject the discovery in this case to the strictures of the Hague Convention procedures or Swiss law on the taking of evidence, as Swiss authorities have a strict view of the proper scope of discovery and it appears likely that the Swiss authorities whose permission Nedela wishes to seek, and with which Nedela would base his compliance, would apply stricter substantive limitations on the scope of the pending jurisdictional discovery requests. Plaintiffs have good faith bases to believe that Nedela would rely on the Hague Convention and Swiss law to avoid responding to the pending jurisdictional discovery in its original form to the extent required under the Federal Rules of Civil Procedure. Nedela's latest submission from his Swiss counsel indicates a clear intent to object to the scope of the requests. For example, in the January 18, 2019 letter from Nedela's Swiss counsel, it was Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 17 of 26 PageID 735 18 represented that "most (if not all) of the documents requested and ordered to produce do not belong to our client but to Offplan Millionaire AG as they are part of the company's business files. Our client would hence first have to obtain these documents from a third party (i.e. Offplan Millionare AG) which could be deemed as illegal in terms of Art. 271 . . . ." (ECF No. 75-4 at 2). However, to the best of Plaintiffs' knowledge, these documents were already gathered by and reviewed by Nedela's counsel in the United States because they were documents in Nedela's possession, custody, or control. Plaintiffs have genuine concerns that Nedela's insistence on using the Hague Convention procedures is an effort to constrain the scope of Plaintiffs' jurisdictional discovery to the point that his assertions of lack of personal jurisdiction cannot sufficiently be corroborated. Plaintiffs' concerns that are objectively reasonable considering the developments of the past few months. In his accompanying declaration in August 2018, Nedela attested that he had nothing to do with the scheme alleged; he was not involved in day-to-day operations; he never hired or had any relationship with the other individual defendants; was never aware of communications with Plaintiffs; and had a merely nominal role in the entity Offplan Millionaire AG. (E.g., ECF No. 56-1 at 7-8.) Yet, once discovery was authorized by the Court, he had 6,000 documents potentially responsive to the request for documents. (ECF No. 67 at 2.) Then, after agreeing to provide responses and appear for depositions, at the last minute, Swiss law is raised as blanket grounds that ostensibly preclude any participation whatsoever to any of the pending discovery requests (apparently unless the scope of the request does not offend the much narrower Swiss law). (ECF Nos. 70, 71.) Most recently, Nedela's counsel informed Plaintiffs that one of the defaulted Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 18 of 26 PageID 736 19 defendants, Offplan Millionaire AG, which Plaintiffs allege that Nedela controlled, just declared bankruptcy on January 11, 2019, apparently giving Nedela yet another new basis to claim that he cannot produce responsive documents. (ECF No. 75-4 at 2.) It is far from clear to Plaintiffs why the bankruptcy of Offplan would prevent Nedela from producing documents already in his possession, custody, and control (namely, documents that were already gathered by and reviewed by Nedela's counsel in the United States). These developments give Plaintiff serious misgivings about Nedela's professed "full[] commitment" to discovery in this case. (Cf. ECF No. 75-4 at 2.) It is particularly telling that Nedela has taken an "all or nothing" approach to objecting to Plaintiffs' jurisdictional discovery; not a single document has been produced, nor single interrogatory answered. Conspicuously, Nedela has provided no explanation whatsoever why he cannot answer Plaintiffs' interrogatories. (Cf. id. at 1) (addressing depositions and document productions only.) He has not made any showing, particularized or otherwise, why those certain Swiss laws would prevent him from answering under oath Plaintiffs' interrogatories about such things as his personal employment at Co- Handelszentrum GMBH (Document Request No. 1); his own meetings and communications with the other defendants in the case (Request Nos. 2-5, 13-14); his first recollections of Plaintiffs (Request No. 18); and his individual travel to Florida (Request No. 23). (ECF No. 64-4 at 6-8.) These are straightforward requests that go to issues that Nedela himself raised in his declaration in support of his argument that the Court lacked personal jurisdiction over him. (See ECF No. 56-1.) This wholesale refusal to respond to discovery and strong indication of the intent to limit the scope of Plaintiffs' discovery belies Nedela's expressions Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 19 of 26 PageID 737 20 of good faith cooperation in discovery and reinforces the need for jurisdictional discovery to determine whether the assertions in Nedela's declaration are corroborated. C. Case law supports this Court's right to enforce the full discovery under the Federal Rules of Civil Procedure against Nedela outside of Switzerland. Nedela has offered no explanation for his insistence that discovery must occur in Switzerland. There is no Court order requiring discovery in Switzerland, and none of Plaintiffs' discovery requests have directed that discovery be taken or produced in Switzerland. Plaintiffs voluntarily offered to go outside this District—indeed, they offered to meet Nedela anywhere at any time—to take his deposition for the sole purpose of making this process easier and faster. District courts, including in the Middle District of Florida, have permitted or ordered discovery to be made outside of Switzerland (or the foreign country with a similar blocking law). See Coca-Cola Foods v. Empresa Comercial Internacional De Frutas S.A., No. 96- 358-CIV-T-17C, 1997 WL 370121, at *6-7 (M.D. Fla. June 12, 1997) (Kovachevich, J.); see also Schindler Elevator Corp., 657 F. Supp. 2d at 527; Trueposition, Inc. v. LM Ericsson Tel. Co., 2012 WL 707012 (E.D. Pa. Mar. 6, 2012); Calixto, 2008 WL 4487679, at *3 (ordering Swiss resident to appear for deposition pursuant to the Federal Rules); Triple Crown Am., Inc. v. Biosynth AG, No. CIV.A. 96-7476, 1998 WL 227886, at *4 (E.D. Pa. Apr. 30, 1998) (ordering depositions of Swiss corporation's agents occur in U.S.); Ward-THG, Inc. v. Swiss Reinsurance Co., No. 96 Civ. 8100(MBM), 1997 WL 83294, at *1 (S.D.N.Y. Feb. 27, 1997) (same); Roberts, 130 F.R.D. at 437 ("[I]f this Court were to order [Defendant] to come to the United States and give his deposition or to produce in the United States documents he now holds in Switzerland or to respond to a request for admissions, he would not be subject to Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 20 of 26 PageID 738 21 penal sanctions in Switzerland."). In Coca-Cola Foods, the foreign defendants announced at the last minute that a personal jurisdiction deposition scheduled in Switzerland might violate Article 271 (one of the same Swiss laws that Defendant Nedela cites) and therefore failed to appear. 1997 WL 370121, at *6. As a sanction, the magistrate judge found, and the district judge agreed, that the defendant was subject to personal jurisdiction in the Middle District of Florida, relying partly on the finding that "defendants do not explain how appearing for a deposition outside of Switzerland will subject them to potential criminal liability under Swiss Penal Code, Article 271." Id. at *8. This presents a situation analogous in many ways to a defendant's invocation in a civil action of the Fifth Amendment privilege against self-incrimination. If Nedela is so concerned that this discovery presents a realistic threat of prosecution for violating Swiss law, he could simply consent to personal jurisdiction in this case. He cannot use Swiss law as both a sword and shield to claim that a lack of personal jurisdiction defeats Plaintiffs' claims against him and then to prevent discovery into his jurisdictional assertions—all the while unduly delaying Plaintiffs' prosecution of this action. He has appeared to defend this case and must therefore play by the Federal Rules of Civil Procedure. Regardless, this Court is not prohibited from ordering discovery consistent with United States rules and case law. See In re Grand Jury Proceedings, 691 F.2d 1384 (11th Cir. 1982) (citing Societe Internationale Pour Participations Industrielles Et Commerciales, S.A. v. Rogers, 357 U.S. 197 (1958)) (explaining the Supreme Court left the district courts "wide discretion" to use other means of obtaining compliance with discovery of a foreign Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 21 of 26 PageID 739 22 party, such as awarding sanctions other than dismissal or default or drawing inferences unfavorable to the non-compliant party, in the absence of complete disclosures). Significantly, if Nedela refuses to comply with the jurisdictional discovery, it is within this Court's discretion to deem personal jurisdiction over Nedela established. See Coca-Cola Foods, 1997 WL 370121, at *8. Plaintiffs submit that it is well-recognized that even if a conflict exists between the laws of the United States and those of a foreign country pertaining to the taking of evidence, the United States courts have authority to order discovery under the Federal Rules of Civil Procedure and are not divested of that authority merely because the United States and Switzerland are signatories to the Hague Convention. For these reasons, Plaintiffs believe it is in the interests of the efficient resolution of this dispute, and the just and efficient resolution of this case as a whole, for the Court to intervene to compel Nedela's compliance with jurisdictional discovery under the Federal Rules of Civil Procedure and make clear that compliance with the Hague Convention procedures is not required in this action. D. Oral argument or, in the alternative, a status conference is appropriate. Pursuant to Local Rule 3.01(j), Plaintiffs respectfully request this Court grant oral argument or, in the alternative, a status conference before the Court to address the issues raised herein. Plaintiffs submit that it would aid the Court and the parties to engage in a one- hour oral argument before the Court following Nedela's response to this Motion. This will ensure that the parties can provide the Court a "better understand[ing of] the situation in Switzerland, including the sequence, timing, and results of actions there" so that the Court can set deadlines to move this case forward. (ECF No. 72 at 1-2.) Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 22 of 26 PageID 740 23 This case remains in a preliminary posture, indeed this Motion seeks to compel discovery as to the preliminary issue of personal jurisdiction; however, there is no reason to believe that many of these same issues, if not addressed now, will be reasserted if this case becomes at issue and proceeds to discovery on the merits. Therefore, oral argument or a status conference for one hour would be suitable to fully address the parties' respective positions and to resolve this as soon as possible, which will potentially avoid a repeat of this exercise during merits discovery. V. Conclusion Well-established precedent supports compelling Defendant Nedela to comply with Plaintiffs' pending jurisdictional discovery without resort to the optional Hague Convention procedures. There is no evidence that Swiss laws pose such a real risk of criminal prosecution of Nedela and the parties' counsel that it outweighs use of the procedures provided by the Federal Rules of Civil Procedure, which are both the default procedures and recognized as much more efficient. Nedela's insistence on use of the Hague Convention procedures risks substantial delays and prejudice to Plaintiffs' ability to respond to Nedela's assertion that this Court lacks personal jurisdiction over him. It raises serious questions about the motive for his change of heart just before complying with this discovery, his reliance on blanket objections, and whether he will indeed be "fully committed" to participate cooperatively in this litigation—in which he has chosen to appear and defend—in accordance with the Federal Rules of Civil Procedure. For the foregoing reasons, Plaintiffs request that the Court: (1) enter an Order compelling Defendant Nedela to respond to Plaintiffs' Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 23 of 26 PageID 741 24 Jurisdictional Discovery as follows: i. that Nedela substantively respond to Plaintiffs' First Set of Interrogatories Regarding Personal Jurisdiction and First Request for Production of Documents Regarding Personal Jurisdiction within 15 days of the Court's Order on this Motion; ii. that Nedela make himself available for a deposition regarding personal jurisdiction within 30 days of the Court's Order on this Motion; iii. that the foregoing discovery be taken or produced in the United States within this judicial district; and iv. that Nedela's failure to provide discovery as specified in the Court's Order will result in the waiver of Nedela's defense of lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 37; (2) grant a one-hour oral argument on this Motion or, in the alternative, set a one-hour pretrial status conference for Plaintiffs and Defendant Nedela to address the pending jurisdictional discovery raised in this Motion and the impact of the delays on jurisdictional discovery on the Scheduling Order; (3) extend the deadline for Plaintiffs' response to Nedela's Motion to Dismiss to a date consistent with the deadlines the Court establishes for Nedela responding to Plaintiffs' jurisdictional written discovery and completing the deposition; and (4) provide any other relief this Court deem just and appropriate. Dated January 28, 2019. Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 24 of 26 PageID 742 25 BAKER, DONELSON, BEARMAN, CALDWELL & BERKOWITZ, PC SunTrust Center 200 South Orange Avenue, Suite 2900 Post Office Box 1549 Orlando, Florida 32802 Telephone: (407) 422-6600 Telecopier: (407) 841-0325 Counsel for Plaintiffs By: s/ Hal K. Litchford Hal K. Litchford Florida Bar No. 272485 hlitchford@bakerdonelson.com Marisa Rosen Dorough Florida Bar No. 73152 mdorough@bakerdonelson.com Spencer D. Leach Florida Bar No. 110753 sleach@bakerdonelson.com CERTIFICATE OF CONFERENCE PURSUANT TO L.R. 3.01(g) I hereby certify that on January 25, 2019, counsel for the parties have conferred regarding the nature of the relief requested in this Motion, and Defendant Nedela's counsel has advised that he opposes the relief requested herein. /s/ Hal K. Litchford Hal K. Litchford Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 25 of 26 PageID 743 26 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on January 28, 2019, a true and correct copy of the foregoing document was electronically filed with the Clerk of Court using the CM/ECF system, and a copy was thereby served upon: Jesus E. Cuza, Esq. Rebecca J. Canamero, Esq. Holland & Knight LLP 701 Brickell Ave., Suite 3300 Miami, Florida 33131 jesus.cuza@hklaw.com Rebecca.canamero@hklaw.com Counsel for Defendant, Joachim Oliver Nedela /s/ Hal K. Litchford Hal K. Litchford Case 6:17-cv-02103-GAP-TBS Document 76 Filed 01/28/19 Page 26 of 26 PageID 744