Hong Kong Court Dismisses 'Fishing' Discovery Applications And Refuses Disclosure Prohibited By Foreign Law

Mayer Brown, on behalf of its gaming clients, successfully resisted an application for specific discovery in K&L Gates v. Navin Kumar Aggarwal and Others [2019] HKCFI 702 ("Decision"). In this long-standing litigation between K&L Gates (the "Plaintiff") and a number of gaming entities relating to monies misappropriated by a former partner of the Plaintiff, the Plaintiff applied for specific discovery on a wide range of documents. In the Decision, which was recently handed down, the Court dismissed the applicant's applications in their entirety for the reasons that it was "a classic case of a fishing expedition" and some requests for documents were "formulated too wide".

The Decision serves as a reminder to litigants that, when seeking specific discovery of a class of documents, the applicant should ensure that the class is not defined too widely with the hope that some relevant documents must be caught. If a request for specific discovery is defective in such way, the Court cannot salvage the application by applying the blue pencil test even if the request may have covered some relevant documents. On a separate note, the Decision also provides useful guidance on the Hong Kong Courts' approach in dealing with requests for discovery of documents which are prohibited from disclosure under foreign law.

Background

The 1st Defendant was formerly a solicitor and partner of the Plaintiff. He was alleged to have misappropriated amounts of money belonging to the Plaintiff's clients and other entities which have deposited funds with the Plaintiff's client account, and gambled the money at various casinos. It is against this background that the Plaintiff firm tried to recover money from the various casinos and made other claims based on breach of reporting and regulatory duties.

In this application, the classes of documents sought by the Plaintiff from certain groups of casinos were mainly the following:

Intra-Group Relationship Documents - "Documents pertaining to the [casinos'] business and/or the casino entities related to the [casinos] and relationship between these entities"; Communication Documents - "Communications and documents [including internal documents] pertaining to approval processes, policies, regulations, rules and applications and/or bank documents of each of the [casinos] in relation to the remittances of money ..."; Gambling Activities Documents - "Communications and documents of each of the [casinos] in relation to and/or arising...