Signify Holding B.V. v. TP-Link Research America Corporation

Background

Signify Holding B.V. brought a contract action concerning patent licenses that it says TP-Link received in exchange for royalty payments. Signify alleged that TP-Link failed to provide required reports about revenue and failed to pay the required royalties. The opinion states that jurisdiction was based on the parties’ diversity and that the contract provided for resolving claims in the Southern District of New York.

The dispute addressed the Rule 30(b)(6) deposition of TP-Link’s designated witness, Deyi Shu. Signify argued that Shu could communicate effectively in English because he had communicated with Signify in English for four years, verified English-language interrogatory responses, and submitted an English-language declaration in another federal case. TP-Link did not dispute Shu’s extensive English communications but argued that sworn deposition testimony differed from ordinary business communications and that an interpreter would help ensure accurate testimony.

Governing Rules

The court explained that federal procedural law governs proceedings in federal diversity cases, even when a contract selects state law. Because the contract’s New York-law provision did not displace federal procedural rules, the court applied federal law governing depositions.

Federal Rule of Civil Procedure 30 requires deposition testimony to proceed in substantially the same manner as trial testimony, subject to exceptions not relevant here. The court therefore applied Federal Rule of Civil Procedure 43, which addresses interpreters for witnesses at trial, and Federal Rule of Evidence 604, which requires an interpreter to be qualified and swear or affirm to provide a true translation. These rules gave the court discretion to decide which party should initially pay for an interpreter. The court also noted that New York courts have treated the state rule cited by TP-Link as allowing discretion to shift interpreter costs.

Ruling

The court found strong evidence that Shu could communicate effectively in English, but it had not observed him and could not independently assess his proficiency. The court also recognized that the complexity of deposition questions might make an interpreter necessary or helpful. Judge Katharine H. Parker concluded that allowing an interpreter was the best course to ensure that Shu understood the questions and properly answered them.

The court ordered TP-Link to pay the interpreter’s services. Each party had to pay its own ancillary costs caused by any delay from using the interpreter, including its own attorneys’ fees. TP-Link was encouraged, but not required, to use the interpreter only when needed rather than for every question and answer. The court also stated that, if TP-Link prevailed in its defenses, it could apply at the end of the case for an award of costs, including translator costs, under Federal Rule of Civil Procedure 54.