Food Delivery Holding 12 S.A.R.L. v. Dewitty & Assocs. CHTD

538 F.Supp.3d 21

In re Application of: FOOD DELIVERY HOLDING 12 S.A.R.L., Applicant,

v.DEWITTY AND ASSOCIATES CHTD, Respondent.

Miscellaneous Case No. 1:21-mc-0005 (GMH)

United States District Court, District of Columbia.

Signed May 10, 2021

Andrew C. Nichols, Charis Lex P.C., Arlington, VA, Eric W. Bloom, Potomac, MD, John Harding, Winston & Strawn LLP, Washington, DC, for Applicant.

Robert DeWitty, DeWitty and Associates, Washington, DC, for Respondent.

MEMORANDUM OPINION

G. MICHAEL HARVEY, UNITED STATES MAGISTRATE JUDGE

Food Delivery Holding 12 S.a.r.l. ("FDH") has filed an application for an order pursuant to 28 U.S.C. § 1782 to issue a subpoena for the taking of a deposition and the production of documents for use in an international arbitration before the Dubai International Finance Centre–London Court of International Arbitration ("DIFC-LCIA"). The target of the subpoena is a local law firm, Respondent DeWitty & Associates CHTD ("DeWitty").¹ For the reasons that follow, the motion is granted.²

I. BACKGROUND

The arbitration underlying this application concerns a company called Hungerstation³ —a Saudi Arabian online and app-based food delivery service founded by Ebrahim Al-Jassim and for which he served as CEO—and a shareholder's agreement among Hungerstation; FDH, Hungerstation's majority shareholder; and Mr. Al-Jassim, Hungerstation's minority shareholder. ECF No. 2-5 at 5–8. In May 2019, pursuant to the arbitration provision in the shareholder's agreement, Mr. Al-Jassim alleged before the DIFC-LCIA that FDH had breached the shareholder's agreement in multiple ways, including by allowing FDH's parent company, Delivery Hero, to "improperly intervene in and/or manage the affairs of [Hungerstation]"; terminating Mr. Al-Jassim's employment with Hungerstation; and sharing confidential Hungerstation information with its competitors. Id. at 19–21.

FDH has interposed counterclaims in that arbitration alleging, among other things, that Mr. Al-Jassim and others employed by Hungerstation used the company's "assets and personnel to establish and develop competing companies in the [Kingdom of Saudi Arabia,] which ... [were] used to skim untold profits out of [Hungerstation] in violation of the [shareholder's agreement]." ECF No. 2-4 at 7. More specifically, FDH asserts that, when Mr. Al-Jassim was CEO of Hungerstation, he used the company's assets and personnel to develop a "new logistics app and platform" to manage the food deliverers, known as riders, and, once that app was completed, transferred the app, the rider database, and Hungerstation personnel to a company he had created (and served as CEO for) called Fast Choice LLC, which does business under the name Pace. Id. at 9 (internal quotation marks omitted); see also id. at 161–64. He then allegedly ensured that all of Hungerstation's deliveries were made by Pace, which charged a "heavily inflated ‘Cost Per Order,’ stripping profits out of [Hungerstation] and siphoning them to Pace." Id. at 9; see also id. at 350–53. According to FDH, Mr. Al-Jassim continues to hold an indirect financial stake in Pace through his cousin. Id. at 259. Mr. Al-Jassim denies both that he is employed by or otherwise involved in the management of Pace and that he has any financial stake, whether direct or indirect, in Pace. ECF No. 2-7 at 61.

Meanwhile, in September 2019, Hungerstation filed an action in the U.S. District Court for the Northern District of California against Pace alleging misappropriation of trade secrets, computer fraud, and other causes of action. See ECF No. 1-8; ECF No. 2-4 at 254–55; see generally Hungerstation LLC v. Fast Choice LLC , No. 19-cv-5861, 2020 WL 137160 (N.D. Cal. Jan. 13, 2020). The district court dismissed the case for lack of personal jurisdiction over Pace, see Hungerstation , 2020 WL 137160, at *1, the plaintiff appealed (ECF No. 1-9), and the Ninth Circuit affirmed ( Hungerstation LLC v. Fast Choice LLC , 857 F. App'x 349, (9th Cir. 2021) ). DeWitty represented Pace in the district court and the Ninth Circuit. ECF No. 1-8; ECF No. 1-9. Additionally, Hungerstation filed successful takedown requests with Apple and Google seeking removal of the Pace app from their app stores as infringing on Hungerstation's copyrighted source code. ECF No. 2-4 at 252–54. FDH alleges that DeWitty represented Pace in those takedown proceedings. ECF No. 2-2 at 11.

Prior to filing its application with this Court, FDH, through counsel, sought to obtain, informally, from DeWitty:

any written communication between [DeWitty's principal, Robert DeWitty] and/or personnel associated with [DeWitty] and Mr. Al-Jassim (or any of his representatives, including but not limited to his personal lawyer and proxy Mr. Patrick Rogers as well as anyone from Mr. Rogers’ law firm Support Legal in Abu Dhabi, United Arab Emirates) related to [DeWitty's] ongoing representation of Pace.

ECF No. 2-8 at 2–3. Mr. DeWitty responded that "any discussions [he] held with [Pace] and associated officials were on the basis of legal representation" and thus privileged. ECF No. 2-9 at 2. Counsel for FDH responded that he was "not suggesting that [Mr. DeWitty] waive the attorney-client privilege," but rather sought "only [ ] the firm's communications with ... Mr. Ebrahim Al-Jassim, not with [Pace]." ECF No. 2-10 at 2. He continued that, if it was Mr. DeWitty's position that all of his communications with Mr. Al-Jassim were privileged, "[t]he issue ... then would be whether to seek a subpoena and insist on a privilege log." Id. Mr. DeWitty did not respond.

FDH filed its application in this Court in January 2021 seeking the issuance of a subpoena against DeWitty, and served it on DeWitty. ECF No. 1; ECF No. 3. The proposed subpoena seeks from DeWitty such things as correspondence between the law firm and Mr. Al-Jassim related to the takedown proceedings, to Northern District of California proceedings, and to Ninth Circuit proceedings; documents executed by Mr. Al-Jassim, provided by the firm to Mr. Al-Jassim, or provided by Mr. Al-Jassim to the firm related to the formation or operation of Pace; communications between the firm and Mr. Al-Jassim reflecting Mr. Al-Jassim's financial interest in Pace or participation in any decision-making on behalf of Pace; and agreements between the firm and Mr. Al-Jassim related to the firm's representation of Pace. ECF No. 2-3 at 13–14. The subpoena also seeks communications and documents exchanged between DeWitty and Support Legal. Id. at 14–15. It further seeks to depose DeWitty on similar topics. Id. at 15–16.

DeWitty failed to oppose the application or its accompanying motion to seal within two weeks of being served, as required by Local Civil Rule 7(b). The Court therefore issued an Order requiring DeWitty to show cause why FDH's "application for an order under 28 U.S.C. § 1782 to issue the proposed subpoena and/or [FDH's] motion to seal should not be granted." ECF No. 8 at 1–2. DeWitty timely filed its response, which asserts that, DeWitty's principal, Robert DeWitty, through his representation of Pace, "has attorney-client privileged information that is simultaneously related to Mr. Al-Jassim and Pace" and argues that the subpoena should not be issued because it seeks production of "attorney-client and privileged communications which cover 1) litigation strategy, 2) attorney though[t] processes, 3) attorney work product, 4) observations about the parties, the law firms, and the Judges involved, 5) motions strategies, and 6) confidential client information" ECF No. 11 at 2–3. He further affirmed that he "did not play a role in any takedown proceedings relating to Pace and third-party server operations." ECF No. 11-4 at 1.

FDH responded that DeWitty's blanket assertion of privilege is both premature and that it fails to properly allege that all responsive documents or communications would be privileged because it does not establish that such material comprised "confidential communications from clients to their attorneys made for the purpose of securing legal advice or services" or "communications from attorneys to their clients" that "rest on confidential information obtained from the client." ECF No. 13 at 4 (quoting Touarsi v. DOJ , 78 F. Supp. 3d 332, 345 (D.D.C. 2015) ). Therefore, "[o]nly a document-by-document claim of privilege will allow FDH meaningfully to dispute the existence of any privilege, or to show a waiver or other exception." ECF No. 13 at 4. The Court held a hearing with the parties on the issue of DeWitty's privilege assertion on May 7, 2021. Notably, at that hearing, FDH agreed to narrow its request to the following: all communications or records involving Mr. Al-Jassim, his counsel, Patrick Rogers, and/or Support Legal, Mr. Rogers’ law firm.

II. DISCUSSION

A two-stage inquiry informs whether a federal court will grant a motion under section 1782. First, the court must determine whether it can order the requested relief—that is, whether it has the authority to do so; second, it must decide whether it should order the requested relief—that is, whether exercising its discretion to do so would further the statute's "twin aims of ‘providing efficient assistance to participants in international litigation and encouraging foreign countries by example to provide similar assistance in our courts.’ " Intel Corp. v. Advanced Micro Devices, Inc. , 542 U.S. 241, 252, 255, 124 S.Ct. 2466, 159 L.Ed.2d 355 (2004) (quoting Advanced Micro Devices, Inc. v. Intel Corp. , 292 F.3d 664, 669 (9th Cir. 2002) ).

As to the first step, "[a] district court has the authority to grant an application when ... (1) the person from whom discovery is sought resides or is found within the district; (2) the discovery is for use in a proceeding before a foreign or international tribunal; and (3) the application is made by an interested person." In re Veiga , 746 F. Supp. 2d 8, 17 (D.D.C. 2010) (citing 28 U.S.C. § 1782(a) ). The second step is informed by the following four factors outlined...