Alpene Ltd v. Republic of Malta

Case summary

At a glance

Parties: Alpene Ltd (Hong Kong) v. Republic of Malta; US court proceeding: In re Application of Alpene, Ltd. for discovery from Elizabeth McCaul
Case no.: ICSID Case No. ARB/21/36; E.D.N.Y. 21 MC 2547 (MKB)(RML)
Forum and rules: ICSID Convention arbitration; discovery application under 28 U.S.C. § 1782
Treaty: China–Malta BIT (Treaty between the People's Republic of China and Malta on the Promotion and Protection of Investments)
Court: US District Court for the Eastern District of New York, Magistrate Judge Robert M. Levy
Sector: Banking
Outcome: On 3 February 2022 the court stayed the § 1782 discovery application until the US Supreme Court decides AlixPartners v. Fund for Protection of Investors' Rights in Foreign States.

The dispute

Alpene Ltd, a Hong Kong company, is the parent of Pilatus Bank, a private bank registered in Malta in 2013. The Malta Financial Services Authority (MFSA) appointed Lawrence Connell as the bank's administrator, or "Competent Person". About eight months later, in November 2018, the European Central Bank revoked the bank's licence. Alpene brought an ICSID claim against Malta under the China–Malta investment treaty. In the United States it asked for discovery from Elizabeth McCaul, a New York resident and former executive of Promontory Financial Group, which was then a consultant to the MFSA. Alpene wanted documents and testimony about her role in, and knowledge of, the decision to appoint Connell. McCaul moved to vacate the discovery order and to quash the subpoenas. She objected on grounds that included relevance and privilege.

Key holdings

The issue is whether an ICSID arbitration is a "foreign or international tribunal" under 28 U.S.C. § 1782. The Supreme Court had granted certiorari in AlixPartners on whether that phrase covers arbitral tribunals constituted under a treaty between States. Lower courts had regularly treated ICSID and other investment treaty arbitrations as covered. pp. 3–4
Alpene argued that ICSID would not be affected by AlixPartners because the World Bank is a "quasi-governmental" authority. The court noted the factors set out in In re Guo but declined to apply them: the parties had not briefed the point, and the court was reluctant to predict how the Supreme Court would rule. pp. 5–6
The application is stayed until the Supreme Court decides AlixPartners. The parties to the ICSID arbitration had not yet scheduled their first procedural conference, so the court found that a stay would not prejudice Alpene. p. 6

Procedural history

30 August 2021Alpene files its § 1782 application in the Eastern District of New York.
9 September 2021District Judge Margo K. Brodie refers the application to Magistrate Judge Levy.
20 September 2021The application is granted, and subpoenas are authorised.
11 November 2021McCaul moves to vacate the order and to quash the subpoenas or obtain a protective order.
11 January 2022Oral argument is heard.
3 February 2022Memorandum and Order staying the application until the Supreme Court decides AlixPartners.
27 October 2022A further § 1782 Memorandum and Order is issued (text not included).

Tribunal, counsel and experts

Decided by: Robert M. Levy Judge, US District Court for the Eastern District of New York (Magistrate Judge; application referred by District Judge Margo K. Brodie)

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