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(CN) — A minority shareholder urged the Fifth Circuit Wednesday to revive its demand for ExxonMobil documents, claiming a Houston federal judge wrongly killed the subpoena with little more than a blunt declaration that it was “way too broad and intrusive and burdensome.”
The dispute centers on a federal law that lets foreign litigants obtain U.S.-based evidence for use overseas. Candel & Partners SAS, a minority investor in ExxonMobil’s former French subsidiary Esso S.A.F., is pressing a shareholder derivative lawsuit in France against Esso’s CEO, Charles Amyot. The suit accuses the company of suspicious deals and financial anomalies that allegedly cost minority investors more than a billion euros.
Candel first won an ex-parte subpoena from U.S. District Judge Keith P. Ellison in Texas. ExxonMobil moved to quash it. After a hearing, the Bill Clinton appointee sided with the oil giant, ruling that all four discretionary factors from the Supreme Court’s Intel Corp. v. Advanced Micro Devices, Inc. decision weighed against the request.
Candel appealed, arguing the judge’s terse oral ruling violated Fifth Circuit precedent requiring enough explanation for meaningful appellate review. The company argues merely reciting the Intel factors is insufficient.
Attorney Stephen R. Halpin III, representing Candel, said the lower court did not adequately explain why it denied all discovery and thus abused its discretion, noting Ellison just gave bottom‑line conclusions without real analysis.
“This court is a court of review, not a first view,” he said. “It should not be wading through the Intel factors in the first instance and the district court didn’t do that.”
The three-judge panel immediately drilled down on whether the full hearing transcript could fill any gaps. Chief U.S. Circuit Judge Jennifer Walker Elrod quoted Ellison’s words directly: “‘I think the request is way too broad and intrusive and burdensome’ — he’s saying that it’s vastly overbroad … isn’t that analysis?” the George W. Bush appointee asked.
Halpin insisted that questions and remarks from the bench do not substitute for a reasoned ruling. He stressed that Candel had repeatedly offered to narrow the subpoena but the judge never considered those options before quashing the entire request.
U.S. Circuit Judge Irma Ramirez pressed on practical responsibility.
“Who’s in the best position here?” the Joe Biden appointee asked. “Why not just issue a new, narrowed subpoena?”
Halpin replied that the parties are best positioned to negotiate and that the record showed Candel tried while ExxonMobil refused to meet and confer.
U.S. Circuit Judge James C. Ho sounded skeptical of remand.
“You’re asking us to remand so that the district court can spell out its reasoning better? And you still lose?” the Donald Trump appointee asked.
Halpin countered that the record actually favors Candel on the Intel factors and the lower court lacked the required “authoritative proof” that French courts would reject the evidence.
ExxonMobil’s lawyer, Jason R. LaFond, defended the ruling as sufficient.
“The district court said enough … far more robust than in any of the cases Candel cites.”
He pointed to prior French court decisions that rejected similar document requests, calling the U.S. subpoena an improper circumvention of French corporate law designed to shield companies from harassment by minority shareholders.
“The French court has conclusively demonstrated that it would reject the evidence sought,” LaFond argued. Elrod pushed back, asking whether the French rulings truly barred the evidence or simply rejected the specific procedural vehicle Candel had used. LaFond maintained the decisions reflected substantive restrictions in French commercial law.
The panel also explored next steps. Halpin noted Candel could file a fresh, narrower application if it loses, though he warned ExxonMobil would likely raise objections. LaFond agreed a new filing would face hurdles but insisted the original subpoena was properly quashed on the merits.
The underlying French lawsuit remains active. Discovery requests have been served on Esso’s CEO, but the French court has not yet ruled. ExxonMobil has since sold its controlling stake in Esso to North Atlantic France SAS.
The appeal was submitted after roughly 40 minutes of argument. A decision is expected in the coming months.
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