Certain amendments to Rule 45 of the Federal Rules of Civil Procedure became effective December 1, 2013. This is the Rule governing all aspects of obtaining evidence from non-parties by subpoena in federal civil proceedings.  The amendments have potential relevance to arbitral practice for arbitrations that have their seat in the United States, as Section 7 of the Federal Arbitration Act (”FAA”) in certain respects equates arbitral subpoena power with judicial subpoena power, and in certain respects equates judicial power to compel compliance or punish non-compliance with an arbitral subpoena with the court’s powers in regard to judicial subpoenas. Most important for the present discussion, Rule 45(b)(2) has been amended to provide that a subpoena may be served anywhere in the United States, whereas before December 1, 2013 the subpoena could only be served within the judicial district of the issuing court, or within 100 miles of the courthouse of the issuing court, or statewide where the judicial district was within a state that provided for statewide service of process.

I consider here the implications of nationwide service of process for a subpoena issued by an arbitral tribunal to a witness located at a considerable distance from the seat of the arbitration.

If the witness does not indicate willingness to comply, the arbitral summons served in a far-flung corner of the country with the benefit of the new Rule 45 provision for nationwide service of process may need to enforced by the local federal court in the judicial district where the arbitrators are sitting. Section 7 states: “[T]he United States district court for the district in which such arbitrators, or a majority of them, are sitting may compel the attendance of such person or persons before said arbitrator or arbitrators, or punish said person or persons for contempt in the same manner provided by law for securing the attendance of witnesses or their punishment for neglect or refusal to attend in the courts of the United States.”

The new statutory authorization for nationwide service of process clears one procedural hurdle to such enforcement: that there must be statutory authorization for the service of process as a precondition to personal jurisdiction. That was a problem under FAA Section 7 before the recent Rule 45 amendment, as we know from a Second Circuit decision, Dynegy Midstream Services, LP v. Trammochem, 451 F.3d 89 (2d Cir. 2006).  InDynegy, an Arbitral Tribunal sitting in New York issued a subpoena to a Houston witness calling for the appearance of the witness at a hearing in Houston. When the witness failed to appear, a motion to compel compliance was made in the Southern District of New York, the motion was granted, and the Houston witness appealed on grounds that the New York federal district court lacked personal jurisdiction. The Second Circuit agreed, holding that personal jurisdiction over the Houston witness could not exist because FAA Section 7 in conformity with Rule 45 did not authorize a New York-based arbitral tribunal summons to be validly served on a Houston witness, just as Rule 45 would not allow a Southern District of New York trial subpoena to be validly served in Houston on a Houston witness.

Related Posts