USA Law and Practice Contributed by: Robert Houck, William Lavery, Joseph Ostoyich and Leigh Oliver, Clifford Chance US
merce and that effect “gives rise to” a US antitrust claim (15 USC Section 6a). Whether the causal nexus between foreign conduct and domestic effect is sufficiently direct will depend on the facts and circumstances, including the struc - ture of the market and the relationships of the par - ties. Appeals courts presently disagree on whether the FTAIA’s directness prong requires that the US effect follow as the “immediate consequence” of the foreign antitrust conduct or whether the domestic effect must only bear a “reasonably proximate causal nexus” to that conduct (compare United States v Hui Hsiung , 778 F 3d 738 [9th Cir 2015] [“immediate conse - quence”] with Lotes v Hon Hai Precision Industries , 753 F 3d 395 [2d Cir 2014] [“reasonably proximate causal nexus”]). Nevertheless, however the test is expressed, the appeals courts generally appear to agree that the wholly foreign price fixing and sale of components included in goods sold to US consumers can have a direct effect on US commerce. The exchange of evidence between parties in federal antitrust litigation is governed by the general rules for discovery in federal court. Those rules contain a permissive standard for what evidence parties may request: “any non-privileged matter that is relevant to any party’s claim or defence”, whether or not that information would ultimately be admissible at trial (Fed R Civ P 26[b][1]). Parties may request production of documents and electronically stored information, writ - ten responses to questions and requests for admis - sions, as well as depositions of witnesses of fact or corporate representatives. Non-US litigants may, in some circumstances, need to provide disclosure that would not be permitted under their own country’s laws. In addition, litigants may serve subpoenas seek - ing discovery from non-litigants. Under these standards, discovery in US federal litiga - tion is, in general, more burdensome, expensive and time-consuming than in many other jurisdictions. In the antitrust context, discovery can be particularly costly because class actions and other antitrust cas - 6. Disclosure/Discovery 6.1 Disclosure/Discovery Procedure
es usually raise a variety of complex issues. Some constraints on the scope of discovery do exist. Since 2015, the federal rules have limited permissible dis - covery to relevant information that is “proportional to the needs of the case” (Fed R Civ P 26[b][1]). Parties may resist discovery requests on a variety of grounds, including that the requested materials fail the rel - evance standard or that compliance would be unduly burdensome under the circumstances. In addition, the Supreme Court – recognising that the burdens of antitrust discovery can push defend - ants to settle even weak cases – has instructed lower courts to take seriously their gatekeeping function at the motion-to-dismiss stage. In 2007, the Supreme Court clarified that, to survive a motion to dismiss an antitrust claim on the pleadings, plaintiffs must allege specific facts, which, if accepted as true, plausibly suggest and are not merely consistent with an anti - trust violation ( Bell Atlantic v Twombly , 550 US 544 [2007]). This decision has raised the bar on what plain - tiffs must allege, often before a court will allow plain - tiffs to request discovery from defendants. 6.2 Legal Professional Privilege The attorney-client privilege protects from the discov - ery process confidential communications between an attorney and client made for the primary purpose of seeking or providing legal advice. In the corporate setting, the attorney-client privilege extends to com - munications between attorneys and those employees who “will possess the information needed by the cor - poration’s lawyers” in order to provide sound legal advice, as well as to those employees who “will put into effect” that advice ( Upjohn v United States , 449 US 383 [1981]). Importantly, in-house counsel com - munications may be protected by attorney-client privi - lege under US law. Furthermore, the privilege protects attorney-client communications made with a business purpose, so long as at least “one of the significant purposes” of the communication was obtaining or providing legal advice (see Kellogg Brown & Root , 756 F 3d 754 [DC Cir 2014]). Internal corporate communications that do not include attorneys may sometimes remain subject to the privi - lege, including where those communications reflect an attorney’s legal advice or where a non-attorney – such
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