Hussain v. 661 Northern Blvd, LLC et al
ORDER granting DE 97 , Motion to Compel. For the reasons set forth in the attached Order, Plaintiff's Motion to Compel is granted and the Trust Agreement must be produced within five days of the date of this Order. Ordered by Magistrate Judge Steven I. Locke on 10/18/2016. (Perri, Anthony)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
ASHRAF HUSSAIN, on behalf of himself and
others similarly situated,
-againstBURTON AND DOYLE OF GREAT NECK,
LLC, MARIO SBARRO, and GENNARO SBARRO,
LOCKE, Magistrate Judge:
Presently before the Court in this wage and hour litigation is Plaintiff Ashraf Hussain’s
(“Plaintiff” or “Hussain”) motion to compel Defendant Mario Sbarro (“Sbarro”) to produce the
Mario Sbarro Long Term Trust Agreement (the “Trust Agreement”) in its entirety. See Docket
Entry (“DE”) . Sbarro and non-party Franklin Montgomery, Esq., (“Montgomery”), oppose
Plaintiff’s motion. See DE , . For the reasons set forth herein, the motion is granted.
A. Relevant Facts
By way of Complaint dated October 9, 2014, Hussain commenced this collective action,
on behalf of himself and all others similarly situated,1 against 661 Northern Blvd., LLC d/b/a
Burton & Doyle Steakhouse, (“661 Northern Blvd.”), Burton and Doyle of Great Neck LLC
(“Burton & Doyle”), Mario Sbarro, Joseph Zangri, and Bert E. Brodsky (collectively
Pursuant to a September 9, 2016 Stipulation, this action was certified as a collective action under 29 U.S.C.
§ 216(b). See DE . To date, twenty-nine former Burton & Doyle employees have elected to become plaintiffs.
Id. at ¶ 5.
“Defendants”),2 alleging violations of the Fair Labor Standards Act of 1938 (“FLSA”), 29 U.S.C.
§ 201, et seq., and New York Labor Law (“NYLL”), N.Y. Lab. Law § 190, et seq. See DE .
On November 17, 2015, Plaintiff filed an Amended Complaint, in which he named Gennaro Sbarro
as a defendant and added allegations in support of his claim that Mario Sbarro was his employer
for purposes of individual liability pursuant to the applicable statutes. See DE . Plaintiff
alleges, among other things, that he worked as a server at Burton & Doyle from January 2013 until
July 2014, but that he did not receive statutorily mandated overtime wages for hours worked in
excess of forty in a given week. See Am. Compl. ¶¶ 7, 65-70. According to Hussain, “[a]s part of
their regular business practices, defendants have intentionally, willfully, and repeatedly harmed
plaintiff . . . by engaging in a pattern, practice, and/or policy of violating the FLSA and NYLL.”
Id. at ¶ 42. Relevant for purposes of the instant motion, Plaintiff further alleges that “Defendant
Mario Sbarro was an owner of Burton and Doyle’s of Great Neck LLC . . . .” Id. at ¶ 10. According
to Hussain, Sbarro “exercised sufficient control over Burton & Doyle’s operations to be considered
Plaintiff’s employer under the FLSA and NYLL, and established and exercised authority regarding
the pay practices at Burton & Doyle’s.” Id.
In Hussain’s June 23, 2015 First Request for the Production of Documents to all
Defendants (“Document Demand”), Plaintiff asked Defendants to produce: (i) “documents
sufficient to show the ownership and/or control of Burton and Doyle of Great Neck LLC”; and (ii)
“all documents concerning Mario Sbarro’s ownership interest, if any, in Burton and Doyle.” See
Document Demand, DE [97-1] at 7. In Defendants’ response to Hussain’s Document Demand,
Defendants produced, among other things, seven pages of the Trust Agreement. See Plaintiff’s
Letter in Support of Motion to Compel (“Pl.’s Mtn. to Compel”), DE , at 1. However, based
Following Plaintiff’s acceptance of an offer of judgment pursuant to Fed. R. Civ. P. 68, Defendants 661
Northern Blvd., Joseph Zangri, and Bert E. Brodsky were dismissed from this action. See DE , .
on the “pagination on the last page produced, the Trust Agreement appears to be at least 37 pages.”
Id. According to Plaintiff, at Sbarro’s deposition, Sbarro testified “that inquiries regarding the
Trust should be made to his estates attorney, Franklin Montgomery.” Id. Accordingly, on May
13, 2016, Plaintiff served a subpoena on Montgomery seeking “documents relevant to the Mario
Sbarro Trust and other entities that controlled Burton and Doyle of Great Neck, LLC.” Id. at 1-2.
Thereafter, on May 10, 2016, Plaintiff and Montgomery entered into a Protective Order Stipulation
(the “Protective Order”), which provides in relevant part that “Mr. Montgomery cannot provide
the Mario Sbarro Long Term Trust and its member share purchase agreement as it would be in
violation of the attorney–client privilege and the privilege is not waivable by Mr. Montgomery.”
See Protective Order, DE [97-4], ¶ 7. According to Hussain, “[b]ased on that representation,
plaintiff did not pursue the matter further.” See Pl.’s Mem. at 2.
On June 30, 2016, Defendants served a motion for summary judgment seeking dismissal of
Plaintiff’s claims against Sbarro. Id.; see also Defendants’ Motion for Summary Judgment, DE
, (“Def. Mtn. for Summ. J.”). In support of their motion, Defendants rely in part on an affidavit
from Dottie Jones, Assistant Vice President and Trust Officer of Blue Ridge Bank and Trust Co.
(“Blue Ridge”), trustee for the Mario Sbarro Long Term Trust (the “Trust”), and the testimony of
Mario Sbarro concerning the establishment of the Trust, but not the Trust Agreement itself. See Def.
Mtn. for Summ. J. at 2-3. In their statement of facts, Defendants assert that the Trust “was established
by Mario Sbarro as Settlor…several years before the alleged acts that form the basis of plaintiffs’
complaint” and go on to note that “[t]he terms of the Trust Agreement do not grant Mario Sbarro
any control or operational authority over any businesses the Trust owns, either directly or through a
subsidiary.” See Def. Mtn. for Summ. J. at 2. Defendants further clarify their position stating that
Sbarro “does not have any voting rights with respect to any stock or membership interests of any
corporate entity that the Trust owns…[and] does not exercise any dominion or control over the Trust
and/or any of the Trust assets.” Id. at 2-3.
B. The Instant Motion
On July 19, 2016, Plaintiff filed the instant motion seeking an Order compelling disclosure
of the Trust Agreement in its entirety. See Plaintiff’s Motion to Compel (“Pl. Mtn. to Compel”),
DE . Plaintiff characterizes Jones’s affidavit as providing “detailed and favorable testimony
about the contents of the Mario Sbarro Long Term Trust.” See id. at 2. Additionally, according
to Hussain, Defendants’ reliance on that testimony to support their position that “Mario Sbarro is
not plaintiffs’ employer because the Trust Agreement does not grant him operational control over
the restaurant” makes the Trust Agreement “the keystone” of Defendants’ motion. Id. at 2-3.
Therefore, “Dottie Jones’ [sic] testimony as to the Trust Agreement and Defendants’ reliance on
the Trust Agreement in their motion, waives any privilege attached to the document.” Id. at 3.
Hussain further argues that “Defendants here are using the privilege as a sword and a shield, and
it is unfair to allow a party to assert a position meanwhile using privilege as a shield to prevent the
opposition from exploring the validity of that position.” Id.
In opposition, Sbarro argues that the instant motion is untimely, and that “Plaintiffs’ belated
quest for the Trust document, now that they have had the opportunity to review the summary
judgment motion, is merely a fishing expedition and a desperate attempt to avoid the dismissal of
Mario Sbarro from this case.” See Defendants’ Letter in Opposition to Plaintiff’s Motion to
Compel, DE , at 2. Sbarro further claims that he is “not in possession of the complete Trust
Agreement, nor does [he] have the authority to compel its production from the Trustee.” Id. at 1.
According to Montgomery, “the Trust can maintain its privilege without creating unfairness to the
plaintiff.” See Franklin Montgomery Letter in Opposition to Plaintiff’s Motion to Compel, DE
, at 2. Specifically, Montgomery contends that, “[w]hile Mr. Sbarro’s ownership is an issue
of the case, the Trust is not the only document that can prove such contention, as the trustee’s
affidavit has stated same.” Id. Montgomery also maintains that he is not permitted to disclose the
Trust Agreement because, his client, Sbarro has not affirmatively waived that privilege. Id.
Applicability of Rule 56
In light of the procedural posture and the relief sought, the Court analyzes Plaintiff’s
motion under Fed. R. Civ. P. 56(d). In the context of a motion for summary judgment, Rule 56(d)
permits the Court to “(1) defer considering the motion or deny it; (2) allow time to obtain affidavits
or declarations or to take discovery; or (3) issue any other appropriate order” if the nonmoving
party “shows by affidavit or declaration that, for specified reasons, it cannot present facts essential
to justify its opposition.” Fed. R. Civ. P. 56(d). Although Plaintiff styled the instant motion as a
motion to compel, it was filed after and in opposition to Defendants’ Motion for Summary
Judgment. See Pl. Mtn. to Compel, Def. Mtn. for Summ. J. Furthermore, Hussain explains the
context of his motion, “Had plaintiff known that defendants would rely on the Trust in support
of its [sic] motion [for summary judgment], plaintiff would have sought its production at an
earlier date.” See Pl.’s Mtn. to Compel at 3. Similarly, in Plaintiff’s Rule 56.1 Counter-Statement
of Undisputed Material Facts (“Pl.’s 56.1 Stmt.”) in opposition to Sbarro’s motion for summary
judgment, Plaintiff claims that “[t]he Trust Agreement has not been provided to Plaintiff
therefore any reference to the contents of the Trust Agreement in these facts is wholly improper.”
See Pl.’s 56.1 Stmt., DE [102-16], ¶¶ 119-21. Accordingly, the Court analyzes Plaintiff’s
arguments pursuant to Fed. R. Civ. P. 56(d) as a request to defer consideration of Defendants’
motion for summary judgment until after additional discovery regarding the Trust Agreement has
B. Application of the Affidavit/Declaration Requirement
Under Rule 56(d), Plaintiff has demonstrated that he is entitled to the additional discovery
he seeks, having substantively complied with the requirements of the Fed. R. Civ. P. 56(d). Courts
in the Second Circuit have held that the party seeking additional discovery under Fed. R. Civ. P.
56(d) “must submit an affidavit or declaration showing ‘(1) what facts are sought to resist the
motion and how they are to be obtained, (2) how those facts are reasonably expected to create a
genuine issue of material fact, (3) what effort [the] affiant has made to obtain them, and (4) why
the affiant was unsuccessful in those efforts.’” See Amto, LLC v. Bedford Asset Mgmt., LLC, --F. Supp. 3d ---, 2016 WL 1030141, at *13 (S.D.N.Y. Mar. 10, 2016) (quoting Guaray v.
Winehouse, 190 F.3d 37, 43 (2d Cir. 1999)); see also Paddington Partners v. Bouchard, 34 F.3d
1132, 1137 (2d Cir. 1994) (observing that the Second Circuit “has established a four-part test for
the sufficiency” of such an affidavit).
Although Hussain has not submitted the formal affidavit generally anticipated under Fed.
R. Civ. P. 56(d) in support of the pending motion, the Court, in its discretion, reads Plaintiff’s
Motion to Compel and Plaintiff’s Rule 56.1 Statement collectively to satisfy the rule’s
requirements. See Jenkins v. Elder, No. 12-CV-4165, 2015 WL 5579699, at *1 n.2 (E.D.N.Y.
Sept. 22, 2015) (citing Holtz v. Rockefeller & Co., Inc., 258 F.3d 62, 73 (2d Cir.2001) (accepting
plaintiff’s complaint and letter response to defendants’ motion for summary judgment
as declarations under Fed. R. Civ. P. 56(c)(4)).
Applying these standards, Plaintiff’s motion to compel is granted. Plaintiff seeks access to
the Trust Agreement in order to ascertain the nature of the relationship between Defendant Sbarro
and Burton & Doyle so that he can establish that Sbarro is individually liable under FLSA and
NYLL. Pl’s Mtn. to Compel at 4 (“The Trust Agreement goes to the heart of the issue of Mario’s
Sbarro’s authority to manage Burton & Doyle restaurant. . . .”).
Defendants concede the
document’s relevance by relying on it in their motion stating, “The terms of the Trust Agreement
do not grant Mario Sbarro any control or operational authority over any businesses the Trust owns,
either directly or through a subsidiary, ” Def. Mtn. for Summ. J. at 2, and arguing that the terms
of the Trust Agreement “confirm that Mario Sbarro did not have the authority or power to make
any decisions relating to the restaurant, including but not limited to the decision to sell it.” Pl.
Mtn. to Compel at 3 (quoting Def. Mtn. for Summ. J. at 11).
Further, Plaintiff’s Motion to Compel details the steps he undertook to gain access to the
Trust Agreement, including document requests, specific requests to defense counsel in response
to initial disclosures, and then finally subpoenas served upon Sbarro’s estates attorney,
Montgomery. See Pl. Mtn. to Compel at 1. Hussain also explains that these efforts were to no
avail due to the allegedly privileged status of the Trust Agreement. See id. at 2. Indeed, in the
Protective Order all parties acknowledged as much, stating that attorney-client privilege prevented
Montgomery from turning over the unredacted Trust Agreement and that he was neither authorized
nor independently permitted to waive the privilege of his client, Sbarro. See id.
Accordingly, when read together, Plaintiff’s Rule 56.1 Counterstatement and Motion to
Compel satisfy the fourfold requirements of an affidavit or declaration seeking relief under Fed.
R. Civ. P. 56(d) and justify Hussain’s present request. Under this construction, the only remaining
issue is whether Defendants’ Motion for Summary Judgment in its references to and reliance upon
the Trust Agreement has waived the privilege Sbarro invokes.
Waiver of Attorney Client Privilege
As set forth below, Defendant Sbarro’s reliance on the Trust Agreement in his summary
judgment motion waives any attorney-client privilege invoked to protect it, rendering it
discoverable. Under federal law,3 although attorney-client privilege serves the public good and
the administration of justice by encouraging open and frank communication between attorneys and
their clients, the privilege protects only those communications between an attorney and a client
that were intended to be and actually were kept confidential. See Upjohn Co. v. United States, 449
U.S. 383, 393, 101 S.Ct. 677, 684 (1981), United States v. Constr. Prods. Research, Inc., 73 F.3d
464, 473 (2d Cir.1996). The party invoking the privilege, furthermore, bears the burden of not
merely proving that it applied at some earlier point in time but also that subsequent conduct has
not waived the privilege. See In re Cty. of Erie, 473 F.3d 413, 419 (2d Cir. 2007) (“A party
invoking the attorney-client privilege must show … a communication between client and counsel
… was intended to be and was in fact kept confidential…”) (emphasis added); Crawford v. Coram
Fire Dist., No. 12 CV 3850, 2014 WL 1686203, at *3 (E.D.N.Y. Apr. 29, 2014) (citing Pall Corp.
v. Cuno Inc., 268 F.R.D. 167, 168 (E.D.N.Y. 2010)) (noting that a party’s partial disclosure of
and/or affirmative reliance upon privileged communications places them at issue likely defeating
any claim of attorney-client privilege over them).
Such a waiver need not be explicit or intentional as the attorney-client privilege may be
forfeited implicitly through a party’s conduct while it prosecutes its case. See id. Consistent with
this principal, the Second Circuit has rejected as unjustly prejudicial the use of the attorney-client
As a preliminary matter, because the wage claims at issue are filed under federal and state law, privilege
issues are governed by federal common law. See Bank Brussels Lambert v. Credit Lyonnais (Suisse) S.A., 160 F.R.D.
437, 441 (S.D.N.Y.1995) (citing to von Bulow by Auersperg v. von Bulow, 811 F.2d 136, 141 (2d Cir. 1987)) (holding
that, since the disputed documents were evidence related both to the federal RICO claims and to the pendent state
claims, privilege issues were governed by federal common law).
privilege as both a sword and a shield. See Favors v. Cuomo, 285 F.R.D. 187, 198 (E.D.N.Y.
2012) (citing United States v. Bilzerian, 926 F.2d 1285, 1292 (2d Cir. 1991) (“A defendant may
not use the privilege to prejudice his opponent's case…”); In re von Bulow, 828 F.2d 94, 101 (2d
Cir. 1987) (“A client may nonetheless by his actions impliedly waive the privilege or consent to
disclosure.”) (internal citations omitted)). Accordingly, a party may not assert the privilege over
a communication and then later make partial self-serving disclosures of the allegedly privileged
material. See Bilzerian, 926 F.2d at 1292. Moreover, a waiver may occur even if the asserting
party does not make direct use of the privileged communication itself when that party avers
material facts at issue related to the privileged communication, and where the validity of those
facts can only be accurately determined through an examination of the undisclosed
communication. Laborers Local 17 Health Benefit Fund v. Philip Morris, Inc., No. 97CIV.4550,
1998 WL 414933, at *1–2 (S.D.N.Y. July 23, 1998) (citing to Bilzerian, 926 F.2d at 1292; In re
Kidder Peabody Secs. Litig., 168 F.R.D. 459, 470 (S.D.N.Y.1996)). Under such circumstances,
fundamental fairness strongly supports a finding that a waiver of attorney-client privilege has
Applying these standards, Defendants’ assertion of privilege as to the Trust Agreement is
waived. Prior to the filing of the Defendants’ Motion for Summary Judgment, Sbarro only
disclosed seven out of 37 pages of the Trust Agreement, withholding the balance based upon a
claim that it was protected under the attorney-client privilege. See Pl.’s Mtn. to Compel at 1;
Protective Order ¶ 7. Nevertheless, Defendants’ Motion for Summary Judgment contains an entire
section stating in detail that Defendant Sbarro is not the owner of Burton & Doyle as memorialized
in the Trust Agreement. See Def. Mtn. for Summ. J. at 2-3. In support of their position, Defendants
attach Sbarro’s testimony, portions of which addresses the Trust’s ownership and control of the
restaurant, and the affidavit of Dottie Jones, a trust officer, which summarizes the provisions and
structure of the Trust Agreement in a manner favorable to the defense. See Def. Mtn. for Summ.
J. Ex. D, H. Defendants then use these assertions to argue that this undisputed lack of ownership
and/or operational control is one factor the Court must consider in ascertaining whether Sbarro is
an employer under the FLSA. Id. at 9. This is a straightforward example of use of attorney-client
privilege as both a sword and a shield in a manner the case law prohibits. See John Doe v. United
States, 350 F.3d 299, 302 (2d Cir. 2003) (“It is well established doctrine that in certain
circumstances a party’s assertion of factual claims can, out of considerations of fairness to the
party’s adversary, result in the involuntary forfeiture of privileges for matters pertinent to the
claims asserted.”); Tribune Co. v. Purcigliotti, No. 93 CIV. 7222, 1997 WL 10924, at *5 (S.D.N.Y.
Jan. 10, 1997) (noting that an implied waiver often occurs when a party makes selective use of
privileged materials, “releasing only those portions of the material that are favorable to his
position, while withholding unfavorable portions”); Kidder Peabody, 168 F.R.D. at 472–73
(holding that the party’s use of the substance of the documents at issue as a sword while at the
same time invoking privilege over them “triggers a waiver of the privilege for those portions of
the documents that embody the substance of any statements”); see also Overbaugh v. United
States, 483 F. Supp. 2d 223, 225 (N.D.N.Y. 2007) (citing Bilzerian, 926 F.2d at 1292 ; Purcigliotti,
1997 WL 10924, at *5-6) (“The attorney-client privilege cannot be used as both a shield and a
sword, and he who holds the privilege may implicitly waive it if he asserts claims that cannot be
fairly evaluated absent examination of protected communications.”).
In their motion for summary judgment, Defendants have put at issue the exact nature of the
relationship created and regulated by the Trust Agreement that they have claimed privilege over.
Accordingly, the privilege is waived and the Trust Agreement must be produced.
For the reasons set forth above, Plaintiff’s Motion to Compel is granted and the Trust
Agreement must be produced within five days of the date of this Order.
Dated: Central Islip, New York
October 18, 2016
s/ Steven I. Locke
STEVEN I. LOCKE
United States Magistrate Judge
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