"K

IN THE SUPREME COURT OF OHLO

ENQUIP TECHNOLOGIES GROUP,INCORPORATED,

Appellee,

vs.

TYCON TECHNOGLASS S.r.l.,

Appellant.

Supreme Court Case No. 10-0335

On Appeal from the GreeneCounty Court of Appeals,Second Appellate District

Court of AppealsCase No. 2009 CA 47

MEMORANDUM OF APPELLEE ENQUIP TECHNOLOGIESGROUP INCORPORATED OPPOSING JURISDICTION

John B. Pinney (0018173)Counsel of RecordKw•a A. Czanik (0075165)Katherine M. Lasher (0070702)C" iRAYDON HEAD & RITCHEY LLP1900 Fifth Third Center511 Walnut StreetCincinnati, OH 45202-3157Phone: (513) 629-2730Fax: (513) 651-3836E-mail: jpinney a ^raydon.com

kczanik k,graydon.comklashcr cr^ >ra den.com

Attorneys for Appellee EnQuipTechnologies Group Incorporated

Leslie W. Jacobs (0020387)Matthew E. Licbson (0071544)THOMPSON HINE LLP3900 Key Center127 Public SquareCleveland, OH 44114-1291Phone: (216) 566-5500Fax: (216) 566-5800E-mail: Les.Jaeobs ciThompsonHine.com

Matthew,Liebson(r^ThompsonHine.com

Attorneys for Appellant TyconTechnogla.ss S.r.l.

TABLE OF CONTENTS

Pame

TABLE OF CONTENTS .................................................................................................................

TABI,E OF AUTHORITIES ... ....................................................................................................... ii

STATEMENT OF THE CASE ........................................................................................................1

STATEMENT OF FACTS ..............................................................................................................2

THE COURT SHOULD DECLINE JURISDICTION ....................................................................5

THIS CASE IS NOT OF PUBLIC OR GREAT GENERAL INTEREST ......................................9

ARGUMENT REGARDING APPELANT'S PROPOSITION OF LAW ..................................... I 1

1. A COURT WITI3IN THE UNITED STATES IS EMPOWERED TOORDER A FOREIGN NATIONAL PART'Y BEFORE IT TO PRODUCEEVIDENCE PHYSICALLY LOCATED IN A FOREIGN COUNTRYTHA'I' ENACTED TIIE PRIVACY DIRECTIVE ................................................11

II. THE AEROSPA'I'IALE FACTORS FOSTER COMITY . ......................................13

III. THE REMOTE TIIREAT OF CRIMINAL SANCTION IS NOT ASUFF'ICIENT REASON FOR A US COURT TO ABROGATECONT'ROL OF DISCOVERY ...............................................................................14

CONCLUSION..............................................................................................................................15

CERTIFICATE OF SERVICE ......................................................................................................16

TABLE OF AUTHORITIES

PdEe

Federal Cases

Hilton v. Guyot (1895), 159 U.S. 113, 162-163) ...........................................................................13

Reinsurance ofAmerica, Inc. v. Administratia Asigurarilor de Stat (C.A.7, 1990),

902 F.2d 1275 ............................................................................................................................15

Societe Nationale Industrielle Aerospatiale v. U.S. Dist. Court for the S. Dist. of

Iowa (1987) 482 U.S. 522, 107 S.Ct. 2542, 96 L.Ed.2d 461 .............................................. passim

United States v. Bank of Nova Scotia (C.A.1 1, 1982), 691 F.2d 1384 .........................................:15

United States v. First Nat'l. Bank qf Chicago (C.A.7, 1983), 699 F.2d 341, 345 ..........................15

United States v. Vetco, Inc. (C.A.9, 1981), 691 F.2d 1281 ............................................................14

State Cases

Chapon v. Standard Contracting & Eng. (Aug. 23, 2007), Cuyahoga App. No.88959, 2007-Ohio-4306 ...............................................................................................................7

Flynn v. General Motors Corp. (Dec. 8, 2003), Columbiana App. No. 02 CO 71,

2003-Ohio-6724 ......... ..................................................................................................................8

State ex. rel. Hughes v. Celeste (1993), 67 Ohio St.3d 429, 619 N.E.2d 412 .............................7, 8

State v. Church (Nov. 2, 1995), Cuyahoga App. No. 68590, 1995 WL 643794 .............................7

TransAmerica Ins. Co. v. Nolan (1995), 72 Ohio St.3d 320, 649 N.E.2d 1229 ..............................7

Statutes

R.C. 2505.02 ....................................................................................................................................5

Foreistn Materials

Directive 95/46/EC of the European Parlianient and of Council of 24 October1995 .................................................................................................................................... passnn

Hague Convention on Taking of Evidence Abroad in Civil or ComtnercialMatters .....................................................................................................................10, 12, 13, 15

ii

Other Sources

Carla L. Reyes, The U.S. Discovery-EU Privacy Directive Con,flict• Constructing

a Three-Tiered Compliance Strategy, 19 Duke J. Comp. & Int'l L. 357, 380(2009) ................................................................................................................................ .........10

Restatement of the Law 3d, Foreign Relations (1987) Section 442 ........................................11,15

U.S. Department of State, Italy Judicial Assistance - Compulsion of Evidence inCivil and Conimercial Matters ...................................................................................................13

The Sedona Conference, Framework, for Analysis of Cross-Border DiscoveryConflicts: A Practical Guide lo Navigating the Competing Currents ofInternational Privacy and e-Discovery (August 2008) ... ....,...< ...................:.............................10

Rules

App.R. 3 .......................................................................................................................................7, 8

App.R. 4 .......................................................................................................................................7, 8

C iv. R. 5 ........................................................................................................................................ 7,8

Civ.R. 58 ......................................................................................................................................7, 8

iii

STATEMENT OF THE CASE

1'his case has its genesis in the breach of an agency agreement under which Plaintiff

EnQuip Technologies Group Incorporated ("EnQuip") represented `I'ycon Technoglass, S.r.l.

("TyTg") for over eighteen years. TyTg is a wholly-owned, indirect subsidiary of Ohio-based

Robbins & Myers, Inc. ("R&M"). EnQuip has asserted claims against TyTg, R&M and

Pfaudler, Inc. ("Pfaudler"),1 for payinent of commissions due at the time of the breach, for an

indemnity required by Italian law, and for commissions on business it alleges was diverted by

R&M from TyTg to Pfaudler.2

Naturally, based on the nature of its allegations, EnQuip's discovery requests souglit

information and documents located in Europe from each Defendant.3 TyTg and Pfaudler refused

to produce any materials from Europe claiming that a European Privacy Directive excused them

from doing so.4 TyTg and Pfaudler further took the position that they had no obligation to

determine if the materials actually contained personal data purpoi-tedly restricted by the Privacy

Directive and produce those that did not.

I Pfaudler is a wholly-owned subsidiary of R&M that also manufactures and sellsglass-lined steel equipment, which was the subject of EnQuip's Agency Agreeinent with TyTg.R&M consolidated sales and distribution funetions of TyTg and Pfaudler in or around early

2005.2 TyTg, R&M and Pfaudler will be referred to collectively as Defendants. R&M

did not join in the appeal to the Second District Court of Appeals, and Pfaudler did not join in theappeal to this Court althougli it was an appellant before the Second District. As sucli, Appellant

will refer to TyTg only.3 EnQuip alleges and has presented substantial evidence in the trial court that

R&M, tln•ough its Process Solutions Group, controls the E.uropean operations of its European-based wholly-owned subsidiaries, including TyTg, Pfaudler Werke (Germany) and Pfaudler

Balfour(Scotland).4 Directive 95/46/EC of the European Parliainent and of Council of 24 October

1995 on the protection of individuals with regard to the processing of personal data and on thefree movement of such data ("the Privacy Directive").

1

The trial cout-C and the Second District Court of Appeals correctly rejected the notion that

an Ohio court is required to adliere blindly to a European Union menrber nation's attempt to

exercise extraordinary legislative jurisdiction to forbid an Ohio judge from ordering discovery

from a party subject to the personal jurisdiction of the Ohio court. Appellant suggests that

comity warrants the Court's review of this case. But, Appellant's interpretation of the Privacy

Directive's reach turns the doctrine of comity as well as the United States Supreme Court's

decision in Socigte Nalionale Industrielle Aerospatiale v. C.S. Dist. Court for the S. Dist. of

Iowas on their heads.

STATEMENT OF FACTS

After EnQuip was forced to file a motion to compel,6 TyTg and Pfaudler claimed for the

first time that the Privacy Directive prohibited their production of materials from Europe.7

On May 13, 2009, the trial court issued the Judgment Entry on Plaintiffs Motion for

Order Requiring Defendants to Fully Comply with Discovery (Request for Production of

s (1987) 482 U.S. 522, 107 S.Ct. 2542, 96 L.Ed.2d 461.6 On March 3, 2009, EnQuip filed a Motion for an Order Requiring Defendants to

Comply Fully with. Discovery. The Motion addressed specifically disputed document requests aswell as Defendants' Objections to the number of Interrogatories served by EnQuip. EnQuip alsorequested that the Court allow interrogatories in excess of those peimitted by local rule. OnApril 2, 2009, the trial court granted EnQuip's Motion to Allow Additional Interrogatories overthe Limit Prescribed by local rule. At the same time, the court also ordered Defendants toprovide answers to the interrogatories or to file a motion for a protective order on theinterrogatories that they contended were objectionable. On April 8, 2009, Defendants filed aMotion for a Protective Order as to EnQuip's Discovery alleging that 14 of EnQuip's

interrogatories were objectionable.7 On April 8, 2009, the Magistrate, on reference from the trial judge, heard

argmnents on EnQuip's Motion for an Order Requiring Defendants to Fully Comply with

Discovery. At the oral argument, Defendants argued that the Privacy Directive prevented theirdisclosing any materials out of Europe. During the hearing, Magistrate Reynolds granted

Defendants leave to file a Supplemental Memorandum in Support of Motion for a ProtectiveOrder on the issue, which was filed on Apri122, 2009. T'he Court also directed EnQuip to file aconsolidated Memorandum in Opposition to the Motion for Protective Order, as well as in

(Continued)

2

Documents) ("5/13/09 Motion to Compel Order") in which the trial court compelled each

defendant both to produce documents requested by EnQuip and to answer disputed

interrogatories. In the 5/13/09 Motion to Compel Order, the trial court implicitly denied

Defendants' Motion for a Protective Order - i.e., by ordering Defendaiits to produce documents

and specifically rejected. the European Union's Privacy Directive's applicability to this case:

"Defendants in this litigation fit within the exception to the restrictions of the Privacy Directive,

if that Directive would even apply to Defendants in this Case."s

In violation of the 5/13/09 Motion to Compel Order, Defendants staunchly refused to

provide any materials out of Europe arguing (amazingly) that the trial court had not addressed

the Motion for Protective Order as it related to the Privaey Directive. EnQuip's eounsel therefore

wrote a letter to the Magistrate requesting "an Order clarifying the Court's position on the Motion

for Protective Order."9

On June 24, 2009, the trial judge entered the Judgment Entry Clarifying Court's May 13,

2009 Judgment Entiy on Defendants' Motion for Protective Order ("6/24/09 Clarifying Order").

Apropos of its title, the 6/24/09 Clarifying Order simply clarified the 5/13/09 Motion to Coinpel

Order. On page 4, the court stated that in the 5/13/09 Motion to Compel Order, "[t]he Court

deterrnined the issues with respect to the three categories cited by EnQuip: ( 1) the impact of

privacy directive on discovery in this case* **." °

Again at page 5 of the 6/24/09 Clarifying Order, the court reiterated that the 5/13/09

Motion to Compel Order decided the Motion for Protective Order:

opposition to Defendants' suppleinental argument based on the Directive, which EnQuip filed on

May 7, 2009.8 5/13/09 Motion to Compel Order at S.9 EnQuip's letter was docketed on June 23, 2009.10 6/24/09 Clarifying Order at 4 (emphasis added).

3

The Motion for a Protective Order was filed in response to Plaintiffs discoveryrequests, and. was directed to the Plaintiffs specific discovery requests that werethe subject of the Motion. Hence, in ruling on Defendants' objections to thediscovery requests that were the subject of the Motion for Protective Order, theCourt decided the Motion for Protective Order.

Accordingly, the Court ORDERS that in the May 13, 2009 Judgment Entry, theCourt implicitly DENIED or GRANTED the Motion for a Protective Ordercon.sistent with the Court's Entry that ORDERED Defendants either to respond tothe Plaintiffs specific discovery requests, or relieved Defendants from that

requirement in whole or ni part.

On July 2, 2009, TyTg and Pfaudler appealed the 6/24/09 Clarifying Order.ll The Notice

of Appeal does not mention the 5/13/09 Motion to Compel Order - nor was it filed within 30

days of the 5/13/09 Motion to Compel Order.

EnQuip filed a Motion to Dismiss arguing that the Appeal was untimely because it was

not filed wPithin tliirty days of the operative order - the 5/13/09 Motion to Compel Order.lZ On

November 9, 2009, the Second District Court of Appeals denied EnQuip's Motion to Dismiss.

The Second District Court of Appeals agreed that the 5/13/09 Motion to Compel Order was the

operative order but held that the appeal was timely because the trial court failed to order the clerk

to serve notice of the 5/13/09 Motion to Compel Order.l3

The Second District Court of Appeals upheld the trial court's order denying TyTg and

Pfaudler's Motion for a Protective Order holding that TyTg and Pfaudler failed to establish that

they were entitled to a protective order.'4 The Second District Court of Appeals also applied the

See, Defendants' Notice of Appeal to the Second Circuit Court of Appeals.8/25/09 EnQuip's Motion to Dismiss Third Appeal.1119/09 Second District Court of Appeals' Decision and Entry ("11/9/09 Decision

and Entrat 6.1/8/10 Opinion.

4

Restatement's15 five-factor balancing test and concluded that the interrogatories and the

documents that EnQuip requested were relevant and not overly broad or burdensome.16

Appellant seeks review of the 1/8/10 Second District Court of Appeals' Opinion.

THE COURT SHOULD DECLINE JURISDICTION

The Court should decline jurisdiction. The Second District Court of Appeals lacked

jurisdiction to review the Privacy Directive's irnpact on discovery in this case because the Order

on which the appeal was lodged - the 6/24/09 Clarifying Order - was not a final appealable

order. Because the Second District Court of Appeals had no appellate jurisdiction, this Court

lacks jurisdiction to review its decision.

T'he Second District Court of Appeals only has jurisdiction to hear an interlocutory

appeal to the extent it is a final appealable order under R.C. 2505.02. Appellant relies on R.C.

2505.02(B)(4), which provides:

"(B) An order is a final order that rnay be reviewed, affirmed, modified, orreversed, with or without retrial, when it is one of the following:

(4) The order that grants or denies a provisional remedy and to

which the following apply:

(a) The order in effect determines the action with respect to theprovisional remedy and prevents a judgnient in the action in favorof the appealing party with respect to the provisional remedy.

's Restatement of the Law 3d Foreign Relations (1987), Section 442 ("Section

442").16 EnQuip does not take issue with the Second District Court of Appeals' analysis

with respect to the Privacy Directive or its decision. However, the Second District Court ofAppeals' attempt to base its decision on the 5/13/09 Motion to Compel Order raises issuesrelating to the Second District Court of Appeals' (and therefore this Court's) jurisdiction.Because jurisdictional issues can be briefed at any time, EnQuip chose to address the issue inresponse to Defendants' Memorandum in Support of Jurisdiction. Given the delay in discoveryto date, EnQuip did not wish to further extend the appellate briefing schedule by filing a cross-appeal on that jurisdictional issue.

5

(b) The appealing party would not be afforded a meaningful oreffective remedy by an appeal following final judgnient * * *.

The Second District Court of Appeals held that the 5/13/09 Motion to Compel Order

"constitutes the final appealable order in this matter."I7 And rightfully so. The Motion 5/13/09

to Compel Order is the only order that compelled Defendants to provide discovery. That order

adjudicated the only discovery in dispute. It also unambiguously addressed the applicability of

the Privacy Directive, specifically holding that the Privacy Directive did not apply to

"Defendants in this case."IR

On the other hand, the 6/24/09 Clarifying Order from which Ty I'g and Pfaudler appealed

did nothing more than clarify the 5/13/09 Motion to Compel Order - it did not determine the

action with respect to the provisional remedy. "I'he Court (at EnQuip's request) simpty reiterated

that the 5/13/09 Motion to Compel Order meant what it said. As such, it was not a final

appealable order. And the Second District Court of Appeals acknowledged the same by holding

that the 5/13/09 Motion to Compel Order "constitutes the final appealable order" (emphasis

added).'9

The Second District Court of Appeals tried to get around that issue by basing its Opinion

on the 5/13/09 Motion to Compel Order. The Second District Court of Appeals held that TyTg

and Pfaudler had an unlimited amount of time to perfect an appeal because the trial court failed

to order the clerk to serve notice of the 5/13/09 Motion to Compel Order,. The problem with that

analysis, however, is that TyTg and Pfaudler did not lodge the appeal from the 5/13/09 Motion to

Compel Order.

17

18

19

11/9/09 Decision and Entry at 3-4.5/13/09 Motion to Compel Order at 8.11 /9/09 Decision and Entry at 3.

6

The Second District Court of Appeals ceded to TyTg and Pfaudler's use of the 6/24/09

Clarifying Order to indirectly and untimely appeal the 5/13/09 Motion to Compel Order (which

was never directly appealed). But TyTg and Pfaudler's bootstrapping is procedurally anomalous

and inconsistent with the appellate rules which contemplate a direct relationship between the

order from which the appeal is taken and the error assigned as a result of that order.20

If an appellant can file a timely appeal simply by filing a "motion to clarify" a previous

substantive order, then the appeal deadline for interlocutory appeals involving a substantial right,

in effect, would be meaningless.21

And, importantly, the notice of appeal was not timely. The Second District Court of

Appeals held that the appeal was timely because the trial court did not direct the clerk to serve

the order. But the Second District Court of Appeals' analysis ignores the fact that TyTg and

Pfaudler received notice of the 5/13/09 Motion to Compel Order pursuant to Civ.R. 5 within

three days of the entry being journalized. As such, the time to perfect the appeal was not tolled.

The Court's analysis in State ex. rel. Hughes v. Celeste 22 is cogent ln Hughes, the Court

held that the Governor's appeal was untimely when the Governor was served pursuant to Civ.R.

5 and failed to perfect the appeal within 30 days. The Court addressed the interplay between

App.R. 4(A) and Civ.R. 58(13):

20 Chapon v. Standard Contracting & Eng. (Aug. 23, 2007), Cuyahoga App. No.

88959, 2007-Ohio-4306, at ¶3 (quoting State v. Church (Nov. 2, 1995), Cuyahoga App. No.

68590, 1995 WL 643794); App.R. 3(D) requires that an appellant designate the order appealed

fi•om.2' EnQuip is aware of the Supreme Court's pronouncement in TransAmeF•iea Ins. Co.

v. Nolan (1995), 72 Ohio St.3d 320, 649 N.E.2d 1229, that pursuant to App.R. 3(A), the onlyjurisdictional requirement for filing of a valid appeal is tnnely filing of a notice of appeal andthat courts of appeals are vested with discretion to determine whether sanctions are warranted

based on otlier defects. TransAmerica and its progeny are inapplicable. In Transamerica, there

was simply a defect with the Notice of Appeal. Here, Appellants sotight appeal of issues in an

order not appealed from.

7

App.R. 4(A) states that'[a] party shall file the notice of appeal required by App.R.

3 within thirty days of the later of entry of judgment or order appealed or, in acivil case, service of the notice of judgment and its entry if service is not niade onthe party within the three day period in Rule 58(B).***' Thus, the Governor wasobligated to file a notice of appeal within thirty days of the January 10, 1991Order granting the peremptory writ, unless service was not made within the three-

day period in Civ.R. 58(B).

Civ.R. 58(B) directs the clerk of court to serve the parties with notice of ajudgment, within three days of its entry upon the journal, in a manner prescribedby Civ.R. 5(B). The task of service of notice of a judgment normally befalls thecourt clerk. Civ.R. 58(B) further provides, however, that'[t]he failure of the clerkto serve notice does not affect the validity of the judgment or running of the timefor appeal, except as provided in App.R. 4(A). App.R. 4(A), by its clear laiiguageas quoted above, tolls the time period for filing a notice of appeal only if serviceis not made within the three-day period of Civ.R. 58(B) 23

The Court held that service was perfected in a maruier consistent with Civ.R. 5(B) and

thus the Governor's appeal was untimely:

The record in this case shows that the court's issuance of the peremptory writ ofmandamus was journalized on January 10, 1991. The docket lacks an entiyindicating that the court clerk served notice on the parties, nor does the recordreveal any evidence of service. Such an apparent defect does not toll the rumringof the time for appeal, however, imless no service is effected within threedays ***This is not the case here. Civ.R. 5(13) provides that service may be made"by delivering a copy to the person to be served***.° Appellant's attorney servedthe Governor's attorney***with a copy of the peremptory writ on the day it wasissued. Service was thus perfected in a manner consistent with Civ.R. 5(B)."

Here, TyTg and Pfaudler were properly served with the 5/13/09 Motion to Compel Order in

accordance with Civ.R. 5(B). On May 15, 2009, within two days of the Motion to Compel

22 (1993), 67 Ohio St.3d 429, 619 N.E.2d 412.23 Hughes, 67 Ohio St.3d at 431.24 Id. See also, Flynn v. General Motors Corp. (Dec. 8, 2003), Columbiana. App.

No. 02 CO 71, 2003-Ohio-6724, at ¶26 ("the record of this matter contzins a motion filed byAppellants themselves showing that they received the judgment entry on or before October 24,2002, and another motion filed soon after describing the content of the judgment entry. * * *Based on these documents in the record, we do not need to rely solely on the Clerk's notationdescribed in Civ.R. 58(B) ***. Because the record reflects that service was made witliin thethree-day time limit set in Civ.R. 58(B), the time for filing an appeal in this case began to run on

the date the judgment entry was filed ***.").

8

Order, Defendants served "Defendants' Reply Meniorandum in Support of Motion for a

Protective Order as to EnQuip's Discovery," which in the opening paragraph states: "Defendants

acknowledge the Court's Order of May 13, 2009 on EnQuip's separate motion to eompel."^^

Clearly, Appellaaris were properly served witli "the final appealable order" and simply

failed to timely perfect the appeal of that Order.26

THIS CASE IS NOT OF PUBLIC OR GREAT GENERAL INTERES'P

This Court should not accept this case for review because (as described above)

jurisdiction is lacking. Also, this case is not of public or great general interest based on the

manner in which Ty'Tg and Pfaudler raised the Privacy Directive in the trial court.

TyTg and Pfaudler essentially sought a blanket pass on participating in discovery with

respect to any materials located in Europe. TyTg and Pfaudler, however, failed to demonstrate

that the Privacy Directive actually prohibited disclosure. Moreover, TyTg and Pfaudler refused

to consider exceptions to the Privacy Directive, which would pennit transfer of materials.

TyTg and Pfaudler also failed to demonstrate that the exception permitting transfer when

"the transfer is necessary * * * for the establislunent, exercise or defense of legal claim" did not

apply. TyTg and Pfaudler stubbornly maintained that the exception does not apply

notwithstanding the Working Party's specific indication that Article 26(l)(d) encompasses cross-

border litigation through the below hypothetical:

The parent company of a multinational group, established in a third country,might be sued by an employee of the group currently posted to one of theEuropean subsidiaries. The exception in Article 26(d) appears to allow the

25 May 18, 2009 Defendants' Reply Memorandum in Support of Motion for a

Protective Order as to EnQuip's Discovery at 1.26 11/9/09 Decision and Entry at 3 (emphasis added).

9

company to legally request the European subsidiary to transfer certain datarelating to the employee if the data are necessary for its defense.27

TyTg and Pfaudler also reiiused to consider seeking consent from any data subjects 28

Instead, TyTg and Pfaudler attempted to shift the burden to EnQuip to obtain production

of the requested materials through the Hague Convention on Taking of Evidence Abroad in Civil

or Commercial Matters ("the Hague Convention"). But, the attempt to force a litigant to use the

Hague Convention as a. first resort was rejected by the United States Supreme Court in

Aerospatiale. This Court should not waste judicial resources re-evaluating the logic of

Aerospatiale, especially, where, as here, resort to the Hague Convention is a dead end. Both

Italy and Germany have declared that they will not allow discovery of any information within

their borders for pretrial discovery, which is no doubt TyTg and Pfaudler's main reason for trying

to require EnQuip to proceed through the Hague Convention.2y

27 In the hypothetical, once the data are lawfully transferred to the parent companyheadquartered in the United States, the data would be subject to the U.S. discovery process.

Carla L. Reyes, The U.S. Discovery-EU Privacy Directive Conflict: Constructing a Three-

Tiered Compliance Strategy, 19 Duke J. Comp. & Int'l L. 357, 380 (2009). Moreover, The

Sedona Conference, Framework_ for Analy.sis of Cross-Border Discovery Conflicts: A PracticalGuide to Navigating the Competing Cur•rents• of International Privacy and e-Discovery (August

2008) - a source cited by Appellants - confirrns the applicability of the exception: "[w]hen aparty receives a binding court order compelling disclosure of information to a destination outsidethe [European Economic Area], then it may be possible to successfully argue that both theprocessing of personal data for the purposes of the transfer, and its export outside the EEA are'necessary' within the meaning of Article 7(c) or Article 26(d) of the Data Protection Directive."

28 Article 26(l)(a) of the Privacy Directive perniits the transfer of personal datawhen the data subject provides unambiguous consent.

29 Under Article 23 of the Hague Convention "a contracting State may at the time ofsignature, ratification or accession, declare that it will not execute letters of request issued for thepurpose of obtaining pretrial discovery of documents***." Italy's accession declaration statesthat "it will not execute Letters of Request issued for the purpose of obtaining pre-trial discoveryof doctunents as known in common law countries." Germany has also filed a reservationessentially declaring that it will not allow discovery of any information regardless of relevance,if the information is sought in relation to a foreign proceeding.

10

Appellant suggests that this case is of great importance because Ohio courts need

guideposts in balancing the interests of discovery in US courts with privacy interests. But the

United States Supreme Court in Aerospatiale has already provided that guidance and articulated

the proper framework based on Seetion 442. And the lower courts here used that framework in

deciding the issue presented. Appellant simply disagrees with the manner in which the lower

courts applied those factors to the facts of this case. That, however, is not a matter of public or

great genera.l interest. Nor is this case otherwise properly situated for this Court's review.

ARGUMENT REGARDING APPELANT'S PROPOSITION OF LAW

Appellant's Proposition of Law: When discovery of documents or inf'ormation located

in a foreign country is sought by a party in a civil case from another party domiciled in the

foreign country, the trial court should not compel a violatiou of the responding party of a law

of its foreign country prohibiting disclosure.

1. A COURT WITHIN THE UNITED STATES IS EMPOWERED TO

ORDER A FOREIGN NATIONAL PARTY BEFORE IT TO PRODUCE

EVIDENCE PI3YSICALLY LOCATED IN A FOREIGN COUNTRY THATENACTED THE PRIVACY DIRECTIVE.

Appellant suggcsts that the lower courts overlooked the nature of the protective order

being sought, "i.e., to establish the legal principle to be applied when excluding entire categories

of material.i30 The thrust of Appellant's argtiment is that a court in Ohio should force a litigant

in Ohio to forego legitimate discovery to be used in the Ohio lawsuit because a party (subject to

the jtirisdiction of the Ohio court) is physically located in a. country that has adopted the Privacy

Directive. But American courts are not required to adhere blindly to the directives of such a

statute. Based on Appellant's position, the Privacy Directive "would appear to represent an

30 2/22/10 Memorandum of Appellant 7'ycon Teehnoglass S.r.l. in Support of

Jurisdiction at 7-8.

extraordinary exercise of legislative jurisdiction by [Italy] over a United States *** judge,

forbidding him or her to order any discovery fl•om a party [within an EU country] *'^` .i31

Appellant's argument flies in the face of well-established principles and United States

Supreme Court precedent. In Aerospatiale, a French manufacturer sought a broad protective

order, requiring its adversary to first resort to the Hague Convention to obtain information

located abroad, based in part, on a French blocking statute. The Court rejected the argument that

U.S. courts must first require a party to resort to the Hague Convention to obtain evidence

located abroad, The Court specifically addressed the French "blocking statute," which is similar

in function to the Privacy Directive:

The French 'blocking statute,' *** does not alter our conclusion. It is well settledthat such statutes do not deprive an American court of the power to order a partysubject to its jurisdiction to produce evidence even though the act of productionmay violate that statute. Nor can the enactment of such a statute by a foreignnation require American courts to engraft a rule of first resort to the HagueConvention, or otherwise to provide the national of such a coanhy with a

preferred status in our courts.'z

The implication of the prefel-red status Appellant seeks is that no defendant subject to the

personal jurisdiction of a U.S. court that happens to be domiciled in Italy, Germany or any other

EU country that has enacted the Privacy Directive has an obligation to meaningfully cooperate in

discovery.

This would clearly fnistrate the United States' important interest in ensuiing that courts

with jurisdiction over disputes adjudicate them based on the best information available.33

31 Aerospatiale, 482 U.S. at 544, n.29.32 ld.33 "The American Law Institute has summarized this interplay of blocking statutes

and discovery orders: '[W]hen a state has jurisdiction to prescribe and its courts have jurisdiction

to adjudicate, adjudication should (subject to generally applicable rules of evidence) take placeon the basis of the best information available ... [Blocking] statutes that frustrate this goal need

(Continued)

12

This Court should not accept Appellant's invitation to challenge the principle in

Ae'rospatiale that the Hague Convention must be a litigant's first resort to obtain evidence

physically located in a foreign country from a foreign national party. This is particularly

relevant, where as here, Appellant seeks a blanket order on all materials located in Europe, and

where resort to the Hague Convention is a dead end.34

II. THE AtROSPAPIALE FACTORSFOSTERCOMITY.

Appellant suggests that clear guideposts are necessary to provide consideration for the

principles of comity.3s However, in the event, the blocking statute applies; the United States

Supreme Court has already provided guideposts as to the factors that are relevant to the comity

analysis which Ohio courts can apply.

Appellant suggests that the lower courts did not properly apply the standard because they

focused on defendants' failure to specify the categories of materials that were prohibited.

Appellant highlights the fact that the five part test focuses on the requests - not the details of the

prohibited material. But, Appellant has put the cart before the horse. A party seeking a

protective order based on foreign law must demonstrate that the foreign law prohibits disclosure

not be given the same deference by courts of the United States as substantive rules of law atvariance with the law of the United States." Id. at n.29.

34 As detailed above, "The Italian Central Autliority has informed the HagueConference for Private International Law that it will not grant requests for pre-trial discovery ofdocuments (Article 23)." U.S. Department of State, Italy Judicial Assistance - Compulsion of

Evidence in Civil and Commercial Matters,http://www.travel.state.gov/law/info/judicial/judicial_653.html#evidsum (last visited March 15,

2010).35 As Appellant notes, "comity is 'neither a matter of absolute obligation, on the one

hand, nor of inere courtesy and good will, upon the other.' Instead, it is 'the recognition whichone nation allows within its territory to the legislative, executive or judicial acts of anothernation, having due regard both to international duty and convenience, and to the rights of its owncitizens of other persons wlro are under the protection of its laws."' February 22, 2010Memoranduin of Appellant Tycon Technoglass S.r.l. in Support of Jurisdiction at 10 (quoting

Halton v. Guyot (1895), 159 U.S. 113, 162-163).

13

with an adequate level of specificity.36 It is only then that the court needs to balance the factors,

which focus on the requests.

The trial court is in the best position to assess the reasonableness of the discovery

requested based on its knowledge of the case, the claims and the interest of the parties. Clearly,

in overruling Appellant's objections and determining that EnQuip was entitled to the materials it

sought, the court implicitly analyzed the Aerospatiale factors: (1) the materials were important

to the litigation; (2) they were sufficiently specific; (3) some of the information undoubtedly

originated in the United States; (4) that there was no sufficient altenlative means to secure the

information; and (5) that noncomplianee would imdermnie the iJS.

Comity does not require a different analysis. The Aerospatiale factors (while not

articulating steadfast rules) provide guidance to courts to protect foreign litigants from

unnecessary or unduly burdensome discovery. On the other haud, Appellant's suggestion that the

Privacy Directive prevents a judge within the United States from ordering a party to cooperate in

discovery based on the Privacy Directive would be particularly incongruous on discovery having

an "onrnipresent effect" such that it was enacted "in a world of only one sovereign."37

III. THE REMOTE THREAT OF CRIMINAL SANCTION IS NOT ASUFFICIENT REASON FOR A US COURT TO ABROGATE CONTROLOF DISCOVERY.

Appellant suggests that it is in a catch-22: (1) comply with discovery and face criminal

sanctions; or (2) produce nothing out of Europe and face litigation sanetions. As an initial

matter, the tln-eat of sanction, even criminal sanctions, is not a sufGcient reason not to coinp1y

36 "The party relying on foreign law has the burden of showing such law bars

production [of documents]." United States v. Vetco, Inc. (C.A.9, 1981), 691 F.2d 1281, 1289. Inorder to meet that burden, the party resisting discovery must provide the Court with inforniationof sufficient particularity to allow the Court to determine whether the discovery sought is indeedprohibited by foreign law.

14

with discovery.38 And there are otlier options available to litigants in Appellant's position. Data

can be pervsissibly transferred if the party obtains consent from the data subject 39

Several courts have interpreted Section 44240 as requiring the party resisting discovery to

make a good faith effort to secure permission from the foreign authorities to make the

infor-nzation available.41 Appellant failed to make any good faith effort to produce the materials.

Litigants should be required to make some good faith effort to comply, rather than shift

the burden to the other party to first resort to the Hague Convention. The trial courC and Second

District Court of Appeals correctly rejeeted Appellant's attempt to create a roadblock for

discovery of any information located in Europe regardless of its iniportanee. And the Court

should not utilize judicial resources evaluating whether the Hague Convention must be a first

resort.

CONCLUSION

For the reasons stated, the Court should not accept this case for review.

37 Aerospatiale, 482 U.S. at 542, n.29.'$ United States v. First Nat4 Bank of Chicago (C.A.7, 1983), 699 F.2d 341, 345

("[t]he fact that foreign law may subject a person to criminal sanctions in the foreign country ifhe produces certain information does not auton2atically bar a domestic court from compelling

production.").39 Article 26(l)(a) of the Privacy Directive.40 Restatenrent, Section 442.41 Reinsurance ofArnerica, Inc. v. AdFninistratia Asigurarilor de Stat (C.A.7, 1990),

902 F.2d 1275, 1282 ("* * * the district court may reqiure a good faith effort from the parties toseek a waiver of a blocking provisions."); United States v. Bank of Nova Scotta (C.A.1 1, 1982),

691 F.2d 1384, 1388-89 (courts may consider the failure of the party raising foreign law to inake

a good faith effort).

15

Dated: March 19, 2010

OF COUNSEL:

GRAYDON HEAD & RITCHEY LLP

1900 Fifth Third Center511 Walnut StreetCincinnati, OH 45202-3157Phone: (513) 621-6464Fax: (513) 651-3836

rt_^John B. Pinney ( '6018173)Kara A. Czanik (0075165)Katherine M. Lasher (0070702)Attorneys for Plciintiff RnQuipTechnologies Group Incorporated,and Jeffrey Naidel and Robert NaidelGRAYDON HEAD & RITCHEY LLP1900 Fifth 'fhird Center511 Walnut StreetCincinnati, OH 45202-3157Phone: (513) 629-2730Fax: (513) 651-3836E-mail: ' imie a raydon.coln

kczanik a graydon.comklashera graydon.com

CERTIFICATE OF SERVICE

This is to certify that a true copy of the foregoing was served by regular U.S. Mail andemail this 19th day of March, 2010, on the following attorneys:

Leslie W. Jacobs, Esq. andMatthew E. Liebson, Esq.Thompson Hine LLP3900 Key Center127 Public SquareCleveland, OII 44114-1291

Joseph M. Rigot, Esq.Thompson Hine LLPOne Atlantic Center1201 WestPeaehtree StreetSuite 2200Atlanta, GA 30309-3499

Kara A. Czanik

H. Alan Rothenbuecher, Esq.Schottenstein Zox & Dumn Co. LPA1350 Euclid Avenue, Suite 1400Cleveland, OH 44115

T. Earl LeVere, Esq.Amy R. Tulk, Esq.Schottenstein Zox & Dunn Co. LPA250 West StreetColumbus, OH 43215

2534789.3

Respectftilly Subnvtted,

16