Charles Forer

Editor’s note: This article describes a hypothetical situation.

Bob is not currently representing any clients in arbitration proceedings. In view of his past mistakes, described in my past articles, Bob’s “withdrawal” from appearing in arbitration proceedings may be a good thing—at least for his clients.

However, Bob’s clients are indirectly involved in arbitration proceedings. One such “indirect” involvement brings us to Bob’s present predicament.

Bob’s longstanding client, RRC, Inc., was recently served with a third-party arbitration subpoena, issued by the arbitration panel in a proceeding between two other companies—MMT and FFR.  The MMT-requested subpoena required RRC’s attendance and production of documents at an arbitration hearing. RRC’s president had only one question for Bob: “What should I do?”

Bob realized that RRC would have to spend a lot of time and a lot of money to comply with the subpoena because it sought lots and lots of documents, in all kinds of formats. So Bob instructed RRC’s president to “leave it to me.” Bob then sent a go-pound-sand letter to MMT. “Absent a court, order,” Bob’s letter said, “RRC will not produce the information requested in the subpoena and will not send a corporate representative to the arbitration hearing.”

Not surprisingly, MMT marched into federal court and sought compliance with the subpoena. Bob anticipated that MMT would do just this; Bob also understood that RRC would not be able to wiggle out of complying with the subpoena altogether. But—and here is where Bob’s ability to see around corners pays off (in his mind anyway)—Bob had an end game. That end game was focused on bottom line considerations; Bob wanted the court to require MMT to pay for RRC’s subpoena-compliance costs up front.

Bob’s response to MMT’s federal court petition to enforce the subpoena screamed that it would be prohibitively expensive to require nonparty RRC to incur the costs and expenses of complying with an expansive and overbroad arbitration subpoena. After all, Bob argued, RRC was an innocent bystander and had nothing to do with the underlying MMT v. FFR dispute. Why should it suffer the burdens of expensive discovery?

The federal court was not persuaded. Without even an acknowledgement of Bob’s this-is-a darn-expensive-document-production argument, the court granted MMT’s petition to compel RRC to comply with the subpoena. No payment of RRC’s costs up front either.

Was Bob fighting a losing battle here? Did RRC have to suck it up and, as a nonparty, face the burdens of sometimes unavoidable and expensive document production? The quick answers: no and no.

First the basics. Then the primer on Bob’s fundamental miscue.

The Basics

An arbitration party by subpoena can direct a nonparty to produce documents at the arbitration hearing. Section 7 of the Federal Arbitration Act authorizes arbitrators to “summon in writing any person to attend before them or any of them as a witness and in a proper case to bring with him or them any book, record, document, or paper which may be deemed material as evidence in the case.”

What happens if the subpoenaed party thumbs its nose at the subpoena? Section 7 gives the answer: the district court in the district where the arbitrators are sitting may enforce a subpoena by compelling attendance or punishing a nonattendee 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.”

A court—not the arbitration panel—has the power to decide subpoena-compliance issues. As a district court held just weeks ago, “a court’s enforcement duties under Section 7 of the FAA include protecting a person ordered to comply with an arbitration subpoena from undue expense, see Fed. R. Civ. P. 45(d)(1) (directing court to enforce party’s duty to ‘take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena’),” as in Maine Community Health Options v. Walgreen’s, No. 18-mc-0009, 2018 U.S. Dist. LEXIS 214029, at *14-15 (W.D. Wisc. Dec. 20, 2018).

Bob’s Blunder

A nonparty to an arbitration proceeding may be able to convince a court that complying with a subpoena is burdensome and expensive. A nonparty may even be able to persuade a court to direct the party seeking the documents to pay the responding party’s subpoena-compliance costs up front.

But since when does a “trust-me” assertion persuade a court? Since when is a court going to credit a this-is-darn-burdensome-to-comply argument based solely on conclusory and general arguments? (“Walgreens’s general arguments about burden aside, it has not presented anything to show that producing the documents will in fact be unduly burdensome.”)

What Bob Should Have Done

 Faced with burdensome document requests, Bob should have discarded his conclusory and vague arguments—his customary oratorical display from the soapbox—and instead provided specific fact-based and documented explanations. These explanations should have included the following for each allegedly burdensome document request in the subpoena:

  • A summary of the breadth and scope of the documents sought.
  • An explanation of the investigation that Bob’s client, the subpoenaed party, must do to comply with the document request.
  • A list of the employees and other persons who must do the investigation and production of documents.
  • A description of what each such employee or other person must do as part of the investigation and production.
  • The estimated time that each employee and other person must spend on the investigation and production—and an explanation (the more detailed the better) that supports the estimate.
  • A description of the difficulties and burdens of conducting the investigation and production.
  • A summary of how the investigation and production would interfere with the ordinary and usual operations and business of the subpoenaed party.
  • A description, with backup documentation, of the costs and expenses of doing the investigation and production.

This detailed factual presentation should seek to demonstrate that producing the documents will be an undue burden and expense, which should satisfy an often-skeptical court that want facts, not conclusory claims. Bob’s new mantra: “More steak, less sizzle.”

Two last questions (answers not needed, except for Bob):

  • Will a court buy written assertions alone—or will a court be more persuaded by fact-based arguments supported by declarations or affidavits that support each factual assertion?
  • Doesn’t this all sound a lot like what parties do—or, at least, should do—when they seek to avoid responding to burdensome document requests?

Charles F. Forer independently provides arbitration, mediation and all other neutral services. He is a co-chair of the Philadelphia Bar Association’s alternative dispute resolution committee and is a former chair of the fee disputes committee. He is a frequent lecturer and writer on the use of ADR in a variety of settings. Contact him at 610-999-5764 and