Opinion
No. 2015/14139.
11-03-2016
Jane A. WADE, Plaintiff v. Michael F. McCONVILLE and McConville, Considine, Cooman & Morin, P .C., Defendants.
Stephen D. Rosemarino, Esq., Couch White LLP, attorneys for plaintiff. Tara J. Sciortino, Esq., Barclay Damon, LLP, attorneys for defendants. Frank J. Fields, Esq., The Glennon Law Firm, P.C., attorneys for Non–Party Cheney.
Stephen D. Rosemarino, Esq., Couch White LLP, attorneys for plaintiff.
Tara J. Sciortino, Esq., Barclay Damon, LLP, attorneys for defendants.
Frank J. Fields, Esq., The Glennon Law Firm, P.C., attorneys for Non–Party Cheney.
MATTHEW A. ROSENBAUM, J.
Defendants, Michael F. McConville and McConville, Considine, Cooman & Morin, P.C., move for an order granting a protective order pursuant to CPLR 3103 conditioning the further production of ESI, if any, on Plaintiff's payment of all costs associated with producing said information. Other motions between the parties were also pending but have been resolved by stipulation and agreement, with one exception. As to the subpoenas issued by Plaintiff, the parties seek guidance from the Court on the appropriate temporal scope of the requests covered by the subpoenas.
This action was commenced on December 30, 2015, alleging among other things, legal malpractice in connection with Defendants' representation of Plaintiff with respect to a commercial transaction that allegedly closed on December 31, 2012. Defendants answered on February 2, 2016, generally denying the allegations. Significant discovery has been exchanged, including ESI. The parties have come before the Court previously on a discovery motion, and a decision was issued thereon.
On July 8, 2016, Defendants provided a Fourth Supplemental Response to Plaintiff's Notice to Produce. This production included a disk containing ESI for the representation by Defendants of the Estate of John Wade. Defendants sent additional correspondence and a disk containing documents consisting of Defendants's complete file for the representation of the Estate of John Wade, as well as additional documents relating to a file with respect to Defendants' representation of Jane Wade.
On July 19, 2016, Plaintiff requested production of the "Case Management System Entries" and the remainder of the ESI for paragraph 9 of Plaintiff's Notice to Produce (which requested Defendants' calendar, docket, appointments, diary, and case management system entries from September 1, 2013 to January 7, 2013 as well as documents showing entries related to the representation of Plaintiff). Defense counsel advised on July 22, 2016 that steps were being taken to explore this ESI and that the issue could be addressed further at a court conference scheduled for July 26, 2016.
During the July 26, 2016 conference, defense counsel stated that they were working with a third-party software provider to determine the procedure to obtain further ESI from Defendants' case management system that had not been previously produced, as well as the cost. Defense counsel suggested that Plaintiff might have to bear the burden of the cost for production.
On September 1, 2016, defense counsel informed Plaintiff that the ESI production would cost $9,000, and advised that due to the undue burden, Plaintiff would have to bear the cost if she wished to proceed. Plaintiff's counsel disagreed about shifting the cost.
Defendants contend that they should not bear the $9,000 cost for the ESI extraction when Plaintiff has failed to specifically articulate what she is looking for with regard to Defendants' case management system. If further production is required of Defendants, they request an order conditioning further production of ESI on Plaintiff's complete payment of costs associated with that production.
Protective Order
"The general rule is that, during the course of the action, each party should bear the expenses it incurs in responding to discovery requests." Westchester Stone Co., Inc. v. Master Mason of New York Inc., 51 Misc.3d 1214(A), *1 (City Ct. Rye, Westchester Co. Feb. 4, 2016). It has been stated:
The question of which party is responsible for the cost of searching for, retrieving and producing discovery has become unsettled because of the high cost of locating and producing electronically stored information (ESI). The CPLR and UCCA are silent on the topic. Moreover, while our courts have attempted to provide working guidelines directing how parties and counsel should prepare for discovery, including ESI, these guidelines generally abstain from recommendations concerning the issue of cost allocation ...
The courts that have spoken on the issue of cost allocation have not done so with one voice. Id. at *1–2.
At least one New York court held that the requesting party should bear the entire cost of searching for, retrieving, and producing discovery that includes ESI. See Lipco Elec. Corp. v. ASG Consulting Corp., 4 Misc.3d 1019(A) (Sup.Ct. Nassau Co.2004). Other courts have found an exception to that where the cost of production is not significant and the ESI is readily available. See Waltzer v. Tradescape, LLC, 31 AD3d 302, 304 (1st Dept.2006). See also, MBIA Ins. Corp. V. Countrywide Home Loans, Inc., 27 Misc.3d 1061, 1075 (Sup.Ct. N.Y. Co.2010) (While producing readily-available electronically-stored information ... will not warrant cost-allocation, the retrieval of archived or deleted electronic information has been held to require such additional effort as to warrant cost allocation"). Where ESI costs are significant, some courts encourage adoption of the standards articulated by the United States District Court in Zubulake v. UBS Warburg, LLC, 217 F.R.D. 309, 317–18 (S.D.NY 2003), which places the costs of discovery, including searching for, retrieving and producing ESI, at least initially, on the producing party. See U.S. Bank Nat. Ass'n v. GreenPoint Mortgage Funding, Inc., 94 AD3d 58, 63–64 (1st Dept.2012). To vary from this standard, a party must demonstrate why the costs should be shifted, assessing several factors: the extent the request is tailored to discover relevant information, the availability of the information from other sources, the cost of products compared to the amount in controversy, the cost of production compared to the party's resources, the relative ability of each party to control costs and its incentive to do so, the importance of the issues at stake in the litigation, and the relative benefits to the parties obtaining the information. See Id. at 64, quoting Zubulake v. UBS Warburg LLC, 217 F.R.D. 309, 317–18 (SDNY 2003).
Defendants do not analyze this standard in arguing in favor of cost-shifting. Moreover, in making this motion for a protective order, Defendants have not proffered to the Court a copy of the $9,000 proposal, nor an affidavit from the Defendants or someone from Aderant.
Here, extracting the ESI requested will allegedly cost $9,000. Plaintiff has requested "Defendants' calendar, docket, appointments, diary and case management system entries ... both ESI and documents, showing entries related to the Representations of the Plaintiff." The Court previously determined that this information was to be produced, and a timely motion to reargue was not made. Accordingly, to the extent it is sought, the Court declines Defendants' invitation to revisit the issues raised in the previous motion.
Defendants' motion for a protective order is denied. Defendants' proffer on this motion is insufficient: they have not submitted a cost proposal or client affidavit on this issue. The Court further notes that Defendants have made no attempt to address the Zubulake factors. Defendants' motion does not satisfy any burden in seeking to shift the costs of producing discovery to Plaintiff.
Plaintiff's Motion to Compel
As noted supra, the parties entered into a stipulation and agreement as to most of the issues raised by Plaintiff's motion to compel. The sole issue remaining for the Court's determination regarding the subpoenas issued by Plaintiff is the temporal scope of the requests covered by the subpoenas. In the subpoenas, Plaintiff seeks to obtain from Cheney financial data, records, and financial reporting from after the December 2012 sale to the present day.
Cheney contends that only those materials in existence at the time of the closing of the sale at issue are relevant to the underlying litigation. According to Cheney, Plaintiff had no involvement with the management of the business after she sold it, and consequently, financial information on the value of the business for the four years after the sale is irrelevant to both the value of the business before it was sold and the diligence on the part of the Defendants in their representation of Plaintiff before the sale.
Plaintiff notes that she seeks several other categories of documents, not just documents relating to the value of the business. Cheney's opposition does not address the motion to compel as it relates to the issues raised by Plaintiff. As to those categories of documents upon which Cheney submits no opposition, the motion to compel is granted as requested.
As to the post-December 31, 2012 documents, Plaintiff contends that the requested documents are relevant to issues and matters that arose after December 31, 2012 and are not related to the value of the business, and further that the documents are relevant to the issue of whether Plaintiff was taken advantage of as a result of the sale.
On the papers before the Court, Cheney has not established that the post-closing documents are irrelevant to the issues presented in this matter. As such, the motion to compel is granted.