Seeing American Litigation Through A French Lens - A Two-Way Exercise

Thursday, May 1, 2008 - 01:00

Editor: It is unusual to find a graduate of one of France's Grandes Écoles as a partner in an American law firm. Will you tell our readers something about your educational background?

Schimmel: I grew up in France and graduated from the École Supérieure des Sciences Economiques et Commerciales. I went on to obtain a law degree from the University of Paris and then Columbia University, where I earned a J.D. and an LL.M. I was the first law clerk to the Hon. Jed S. Rakoff, a federal judge in the Southern District of New York.

For the past 12 years my practice has focused on representing companies in international arbitrations, transnational litigation, and internal investigations, particularly Foreign Corrupt Practices Act (FCPA) and compliance investigations.

Editor: Your background must give you a particular advantage in being able to see things from the standpoint of both an American lawyer and, say, a French lawyer or a French client.

Schimmel: My background has helped in three ways. I have represented a number of clients in international arbitration proceedings governed by civil laws, such as the laws of Venezuela, Mexico and Brazil. Having a background in civil law has helped me to better understand these laws.

Second, I appear frequently before arbitrators who have a civil law background, like me. It is extremely helpful, coming from such a jurisdiction myself, to understand their perspectives and expectations.

Third, I represent a number of companies based in France, or francophone countries, in international arbitration proceedings and litigation. Foreign companies are concerned and skeptical about U.S. litigation. Being able to explain to clients, in their own language, the complexities of U.S. litigation makes a significant difference.

Editor: I see that you have also lectured at McGill. Quebec, Mexico and Louisiana are the only civil law jurisdictions in North America.

Schimmel: At McGill, I lectured on discovery practices in international arbitration and differences in common law and civil law traditions. The seminar included participants from the United States, Canada and Mexico. Having a dual civil and common law background helped me communicate with this diverse group.

Editor: Will you describe the focus of your international practice today?

Schimmel: My practice focuses on three areas: international arbitration, transnational litigation and internal investigations. I have represented clients in arbitrations arising from mergers and acquisitions, joint venture agreements, shareholders' agreements, construction projects, licensing agreements, leases, and a variety of employment agreements of key executives. I have also been appointed a sole arbitrator by the ICC (International Chamber of Commerce). With respect to litigation I have, among other things, represented foreign companies in a number of lawsuits, including fraud cases, contract disputes, and corporate governance cases involving the responsibilities of directors and officers, who wore dual "hats" in the United States and abroad. With respect to internal investigations, I have represented French and other European companies in FCPA investigations and compliance. One recent case involved an investigation in 30 different countries.

Editor: Would you share with us some of the interesting cases that you have handled where your background proved to be particularly useful or helpful?

Schimmel: One of the most interesting arbitrations involved the representation of a joint venture in a large arbitration arising from the construction of a facility in Venezuela. Two members of the tribunal had a civil law background and one had a common law background. The arbitration was governed by Venezuelan law. There was no authority on point in Venezuela and very little reported case law. In these circumstances, I worked with a team of lawyers that researched the laws of other civil law jurisdictions, including France, Portugal, Spain, Switzerland and Italy, to locate authorities on point. I also worked with Venezuelan law experts. Having an understanding of civil law went a long way in facilitating the communications with the Venezuelan law expert, understanding Venezuelan law, and ultimately persuading the arbitral tribunal.

Editor: How does handling needs for international clients in the United States differ from addressing those of U.S. clients?

Schimmel: A significant portion of my work consists of translating legal concepts for international clients. In the United States, for instance, approximately 98 percent of all civil actions filed in federal court settle before trial. In France only 10 to 20 percent of civil actions settle before trial. In France - unlike the United States - a plaintiff is expected to have most of the evidence in his possession before the complaint is filed. Therefore, the perspective of French and other clients in continental Europe is significantly different from their American counterparts. A lawyer representing these foreign clients must be able to explain complex issues of U.S. litigation and guide them through the process.

Editor: You mention evidence. Obviously, we have a completely different system here. Are the Europeans prepared to provide evidence in aid of U.S. litigation?

Schimmel: That is a really good question. In 1980, France enacted what is called a "blocking statute." This statute prohibits anyone from gathering evidence in France to prosecute or defend a claim in the United States or anywhere else except pursuant to an international convention. The penalties contemplated by the statute are up to six months in jail and a fine, but for many years that statute was not enforced in France. In December 2007, the French Supreme Court upheld the first criminal conviction for violating the blocking statute. If a litigant from the United States complies with the Hague Evidence Convention, however, the French courts will be accommodating and make available all or at least most of what is sought. The French courts are prepared for U.S. litigation, but increasingly they expect litigants in the United States to go through the Hague Evidence Convention.

Editor: To what extent are these differences attributable to culture?

Schimmel: Many of the differences between French and U.S. litigation are attributable to culture. For instance, French and U.S. litigation reflect very different conceptions of power. In a French civil action, the judge supervises more closely the work of the lawyers. That is not the case in the United States, where the parties are much more active. U.S. and French litigation also reflect a different approach to the truth. In the United States, the evidence used is much more precise than in France. After all, in a large case, the parties will frequently exchange a million pages of documents. At the same time, a U.S. action rarely results in a judgment declaring what the truth is. The purpose of discovery is to help develop a theory of the case and assess the strengths and weaknesses of the case to calculate the value of a settlement. In France, the volume of evidence is considerably less, but a critical aspect of the action lies in obtaining a judgment.

And, of course, in France the triers of fact are the judges themselves and not juries. Editor: Is there really any difference between European clients transacting business in the United States and your U.S. clients? I would think that since you are a proactive lawyer, you are talking to your oversees clients about doing business in the United States, about practical matters such as class actions, e-discovery and motion practice - legal realities that may seem unfamiliar to them.

Schimmel: That is exactly right. International clients expect us to guide them through the pitfalls of U.S. litigation. There are recent examples where French litigants, and ultimately the French taxpayer, paid significant amounts to settle the case because the individuals in charge of the litigation strategy did not fully understand the difference between a French and an American lawsuit.

Editor: What is the greatest challenge for European clients seeking U.S. representation?

Schimmel: There are at least three challenges. European clients with a need for U.S. representation must seek out U.S. firms willing to step into their shoes and understand the specific issues the European company faces, issues that may not come up with American clients. The second challenge is to locate a firm with the capacity to explain the issues of U.S. litigation in a language the client is most comfortable with. Finally, there is the issue of cost, finding a law firm that is affordable.

Editor: American litigation is considerably more expensive than anything that you run into in Europe.

Schimmel: That is right. And in the United States the prevailing party does not recover legal costs.

Editor: For your international clients, is there an advantage to Kelley Drye's not being one of the largest U.S. firms covering all of Europe?

Schimmel: Kelley Drye represents a number of European and Indian clients. The firm is one of the premier litigation firms in the United States. One of its principal advantages lies in the quality of its legal work. As a consequence of its size - about 400 lawyers - and focus, the firm faces fewer conflicts of interest than the larger U.S. firms with operations in European countries. Kelley Drye's size also translates to an efficiency in billing that larger firms do not enjoy.

Editor: What is the most fulfilling aspect of your multicultural practice?

Schimmel: My practice is very exciting. One of the most exciting things is appearing before arbitrators from diverse cultural and legal backgrounds and finding a common language and field of reference to resolve complex issues.

Please email the interviewee at dschimmel@kelleydrye.com with questions about this interview.