Friday, February 1, 2013

Japanese IT Litigation 1

To understand the Japanese IT litigation, it is important to know the difference between the American and Japanese systems of civil procedures. Some of the important aspects are (1) no jury in civil procedures, (2)virtually no discovery, and (3) most cases are decided on merit.

First, although we introduced a quasi-jury system "saibanin system" into some criminal cases, all the civil cases are conducted as bench trials. The judges' decision-making basically means a more predictable outcome, more reliance on documentary evidence (than witness testimony), and a more or less lengthened hearing (as there is less need for a "condensed" trial within a few days or a week for the jury).

Second, although the Japanese Code of Civil Procedure has an order to submit a document (Article 221-), where the court orders a holder of a document for submission, the system does not function very well overall. One of the reasons for this is the difficulty to determine the conditions and exceptions for the obligation to submit a document, which are not so widely and generally provided as "Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense" in 26(b)(1) of the Federal Rules of Civil Procedure. (Note: Although the Japanese Code introduced a "general" obligation to submit a document by the

amendment, there are important exceptions, which mean that courts nevertheless have to contemplate whether the case falls into any of the categories for exceptions.)  I know that some people criticize this as contradictory, saying that if judges find documentary evidence important, then the range and scope of discovery should be wider than the American system.

Third, although some cases are dismissed on procedural grounds (such as jurisdiction), as long as the plaintiff is represented by a lawyer, it is extraordinarily rare that a case is dismissed on procedural grounds alone. I only experienced one case where the court ordered to revise the complaint within a certain deadline (otherwise the complaint would be dismissed), but this was a case where the plaintiff was not represented by an attorney (and because the plaintiff duly revised the complaint, the case went into the phase of being judged on its merits).  Some of the reasons are that as we virtually do not have a discovery and jury trial, we do not have much necessity for the 12(b)(especially 12(b)(6)) motion to dismiss the case in order to let the defendant get out of the case before discovery.  If the case is dubious, then the court will quickly dismiss the case on merit.  Also, there is no such thing as summary judgment in Japan.  If the cases are appropriate for a summary judgment, then the judges just try to proceed the case quickly and render a final judgment. (N.B., Intermediate judgment
(chukan hanketsu) in Japan is not a summary judgment but a judgment rendered, for example, in order to show that the defendant owes liability and after the intermediate judgment, the parties continue the litigation to assess the amount of damage the plaintiff is entitled.)

In summary, without a jury trial and virtually no discovery, Japanese litigation is cheaper than American litigation and therefore the case is fought mostly on its merits rather than technical procedural issues such as "whether the plaintiff stated a claim."  But this does not mean that Japanese lawyers and information technology companies love litigation.  In general, most practitioners, at least in the field of IT, try to avoid litigation. The "Japanese IT Litigation" series article will describe why Japanese practitioners do not love IT litigation, how people in this field should act to avoid IT litigation, and what they should do when they are either actually sued or when there is no other way for them but to commence a lawsuit.

DISCLAIMER: "IT Law issues in Japan" only provides general information about Japanese information technology law and does not, under any circumstances, constitute legal advice. You should first obtain the advice of professional legal counsel who is qualified in Japan before acting or refraining from acting based on this blog.

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