Opinion
16150 151693/13.
12-08-2015
JPMORGAN CHASE FUNDING INC., Plaintiff–Appellant, v. William D. COHAN, Defendant–Respondent.
Levi Lubarsky Feigenbaum & Weiss LLP, New York (Howard B. Levi of counsel), for appellant. Liddle & Robinson, L.L.P., New York (Blaine H. Bortnick of counsel), for respondent.
Levi Lubarsky Feigenbaum & Weiss LLP, New York (Howard B. Levi of counsel), for appellant.
Liddle & Robinson, L.L.P., New York (Blaine H. Bortnick of counsel), for respondent.
Opinion
Order, Supreme Court, New York County (Manuel J. Mendez, J.), entered March 25, 2015, which, among other things, denied plaintiff's motion for a protective order, unanimously modified, on the law, to grant the motion solely as to any tax returns produced, and otherwise affirmed, without costs.
Plaintiff, a subsidiary of defendant's former employer, failed to show that, other than the tax returns, the requested documents, regarding a partnership and investments made by the partnership, contain trade secrets (see Mann v. Cooper Tire Co., 33 A.D.3d 24, 30–31, 816 N.Y.S.2d 45 1st Dept.2006, lv. denied 7 N.Y.3d 718, 827 N.Y.S.2d 688, 860 N.E.2d 990 2006 ). Plaintiff's counsel's affirmation contains conclusory assertions (see Linderman v. Pennsylvania Bldg. Co., 289 A.D.2d 77, 78, 734 N.Y.S.2d 67 1st Dept.2001 ), and does not discuss the extent to which the approximately 6,000 potentially responsive documents contain information known outside of the partnership, the current value of that information to both the partnership and its competitors, the manner in which the information was obtained and kept, and the ease or difficulty of obtaining the information from nonpublic funds or other investors (see Ashland Mgt. v. Janien, 82 N.Y.2d 395, 407, 604 N.Y.S.2d 912, 624 N.E.2d 1007 1993 ). Although the initial showing required by a party seeking a protective order against discovery of documents containing trade secrets is “minimal” (Jackson v. Dow Chem. Co., 214 A.D.2d 827, 828, 624 N.Y.S.2d 675 3d Dept.1995 ), it still must be non-conclusory and give rise to a “concern that [plaintiff's] competitors may gain some competitive advantage as a result of discovery of secret business procedures and information” (Linderman, 289 A.D.2d at 78, 734 N.Y.S.2d 67 [internal quotations omitted; bracketed material altered] ). Plaintiff failed to make the requisite showing. We also reject plaintiff's claim that defendant is otherwise contractually bound to keep the documents confidential.
Nonetheless, we find that the demanded tax returns are entitled to confidentiality at this point in the litigation. We have consistently treated discovery requests for tax returns with heightened scrutiny, recognizing that they are confidential by their nature (see e.g. Kodsi v. Gee, 54 A.D.3d 613, 614, 864 N.Y.S.2d 9 1st Dept.2008; Rosenfeld v. Kaplan, 245 A.D.2d 176, 666 N.Y.S.2d 180 1st Dept.1997 ). under the circumstances, the trial court should have directed that the disclosure of tax returns in this case be made subject to an order of confidentiality. We cannot ascertain on the record presently before us whether the claims in the underlying action put the tax returns “at issue” in this action (see People v. Greenberg, 63 A.D.3d 576, 881 N.Y.S.2d 92 1st Dept.2009; Veras Inv. Partners LLC v. Akin Gump Strauss Hauer & Feld LLP, 52 A.D.3d 370, 860 N.Y.S.2d 78 1st Dept.2008 ). Regardless, because an at issue waiver affects whether a document is discoverable, not whether it can be cloaked with confidentiality against outsiders to the litigation, it would not change the outcome of this dispute.