This case arises from the ongoing divorce proceedings between the plaintiff and the second defendant (i.e. the Wifeand the Husband) in the United States Superior Court of California.

A contentious issue in the divorce was the valuation of the Husband's share options in Inspire Inc (the Company), a company incorporated in the Cayman Islands. The Husband claimed these options are worth US$0, while the Wife contended they could be valued at over US$70 million if exercisable.

The Husband could not provide discovery of the relevant documents, as they were not in his possession, custody, or control. On such basis, the US court requested assistance from the Cayman Islands Grand Court to obtain discovery regarding these share options and related documents which would assist the valuation of such options.

The jurisdictional basis for the Cayman Islands court to give effect to a letter of request from a foreign court is provided for under the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978. In deciding to grant the discovery order, the Grand Court outlined seven principles guiding the exercise of its discretion:

1. The court will ordinarily give effect to a letter of request from a foreign court so far as it is proper and practicable under local law. This reflects judicial and international comity and conforms with the spirit of the relevant international conventions.
2. The court must first decide whether it has jurisdiction and then whether it should exercise discretion to make or refuse the order.
3. The court should accept the foreign court's statement that the evidence is required for civil proceedings, but at the same time must objectively examine the request.
4. The court should exercise discretion to make the order unless satisfied that the application is frivolous, vexatious, or an abuse of process.
5. The court has power to accept or reject the request in whole or in part, but should not attempt to restructure, recast or rephrase the request so that it becomes different in substance from the original request.
6. The issue of relevance falls to be determined by the foreign court controlling the proceedings for which assistance of the Grand Court is sought.
7. The foreign court should be afforded the fullest help possible.

Despite the Husband’s opposition to the disclosure of some documents on the basis that such categories were too widely defined, the Grand Court refused to remove such categories in their entirety, as this would undermine the entire purpose of the letter of request. Instead, the court only made slight modifications such as deleting ambiguous terms like "portfolio companies" and "affiliates" to avoid unnecessary burden on the Company. This was also to ensure that the nature of documents to be disclosed are sufficiently identified and distinguished from each other.

The court also ordered that the Company be reimbursed by the Wife for the costs incurred in complying with the order, whilst the Husband who had largely failed in challenging the order was directed to pay the costs of the application.

This decision is encouraging for parties involved in foreign proceedings, particularly for those seeking access to corporate information and records which are typically not publicly available. The Grand Court has again demonstrated its willingness to facilitate international judicial comity, providing a viable avenue for obtaining evidence necessary for the determination of complex cross-border disputes.