Tiger Capital, LLC v. PHL Variable Insurance Company
Filing
56
MEMORANDUM AND ORDER granting in part and denying in part 45 Motion to Compel. For the reasons set forth above, PHL's motion to compel (Docket no. 45) is granted in part and denied in part as set forth above. Tiger shall produce the remaining responsive documents and a privilege log within one week of the date of this order. (Signed by Magistrate Judge James C. Francis on 8/26/2013) (lmb)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
- - - - - - - - - - - - - - - - - -:
TIGER CAPITAL, LLC,
: 12 Civ. 2939 (CM) (JCF)
:
Plaintiff,
:
MEMORANDUM
:
AND ORDER
- against :
:
PHL VARIABLE INSURANCE COMPANY,
:
:
Defendant.
:
- - - - - - - - - - - - - - - - - -:
JAMES C. FRANCIS IV
UNITED STATES MAGISTRATE JUDGE
Tiger Capital, LLC (“Tiger”) brings this action against the
PHL Variable Insurance Company (“PHL”) challenging PHL’s 2011 cost
of insurance rate adjustment.
This case is related to Fleisher v.
Phoenix Life Insurance Co., No. 11 Civ. 8405, and U.S. Bank
National Association v. PHL Variable Co., No. 12 Civ. 6811.
The
defendant now moves for an order compelling the plaintiff to
produce responsive documents and to produce Barry Zyskind for a
deposition.
Background1
On August 29, 2012, PHL propounded its First Set of Requests
for Production of Documents (“RFP”).
(Defendant PHL Variable
Insurance Company’s First Set of Requests for Production (“RFP”),
attached as Exh. A to Declaration of Ben V. Seessel dated Aug. 6,
2013
(“Seessel
Decl.”)).
The
plaintiff,
in
September
2012,
collected approximately two million documents that were potentially
1
The facts relating to the plaintiff’s claims are set forth
in detail in U.S. Bank National Association v. PHL Variable Co.,
No. 12 Civ. 6811, 2012 WL 5395249 (S.D.N.Y. Nov. 5, 2012),
familiarity with which is presumed.
1
responsive including 200,000 documents from Steven Ungar, Tiger’s
in-house counsel. (Declaration of Phillip M. Manela dated Aug. 16,
2013 (“Manela Decl.”), ¶¶ 2-3).
produce
any
documents
until
The plaintiff, however, did not
January
31,
2013,
and
made
two
additional productions on February 8 and March 19, 2013, producing
in total 6,295 documents with 111,368 bates numbered pages.
(Seessel Decl., ¶ 3; Letter of Phillip M. Manela dated Jan. 31,
2013, attached as Exh. C to Seessel Decl.; Letter of Phillip M.
Manela dated Feb. 8 2013, attached as Exh. D to Seessel Decl.;
Letter of Phillip M. Manela dated March 19, 2013, attached as Exh.
E to Seessel Decl.).
On June 27, 2013, PHL served a notice of deposition for Barry
Zyskind, Chief Executive Officer of AmTrust Financial Services,
Inc. (“AmTrust”), Tiger’s parent company.
(Notice of Deposition
dated June 27, 2013, attached as Exh. K to Seessel Decl.).
Tiger
did not formally object to the deposition but would not commit to
his appearance.
(Seessel Decl., ¶ 18).
On July 5, 2013, Tiger informed PHL that it had “‘identified’
a ‘very large number of responsive non-privileged documents’” which
contained some non-responsive information but would not produce
them unless PHL’s counsel agreed not to use the non-responsive
information or share it with their client.
(Seessel Decl., ¶ 4).
The defendant brought a motion to compel the production of those
documents (Docket no. 35), which it later withdrew, having resolved
the issue with the plaintiff.
(Memorandum Endorsement dated July
22, 2013, at 1).
2
On July 12, July 25, and August 2, 2013, the plaintiff
produced additional documents, consisting of 18,164 documents, or
141,690 bates numbered pages.
(Seessel Decl., ¶¶ 6-7; Letter of
Phillip M. Manela Dated July 25, 2013, attached as Exh. G to
Seessel Decl.; Letter of Phillip M. Manela Dated Aug. 2, 2013,
attached as Exh. H to Seessel Decl.; Defendant’s Memorandum of Law
in Support of Its Motion to Compel Production of Documents and
Appearance at Noticed Deposition (“Def. Memo.”) at 3).
On July 5, 2013, the defendant asked the plaintiff to provide
a firm date by which it would provide a privilege log and the
plaintiff responded that it believed that “nothing ha[d] been
redacted or withheld as privileged from the documents Tiger [had]
produced thus far.”
(Seessel Decl., ¶ 15).
Tiger later informed
PHL that it had “‘identified a large number of documents with Steve
Ungar’s name,’ and was ‘in the process of reviewing these for
privilege . . . .’”
(Seessel Decl., ¶ 16).
Discussion
A.
Document Production
PHL seeks to compel Tiger to produce all responsive documents.
In response, Tiger contends that it has produced “[m]any, if not
all” of the documents sought by the defendant and any delay in
production
is
a
result
of
the
large
volume
responsive documents and its limited resources.
of
potentially
(Plaintiff’s
Memorandum of Law in Opposition to Defendant’s Motion to Compel
(“Pl. Memo.”) at 2-3; Declaration of Phillips M. Manela dated Aug.
16, 2013 (“Manela Decl.”), ¶¶ 1, 4, 7, 10).
3
It has not objected to
the production of documents identified in the defendant’s motion.
Accordingly, the plaintiff shall produce the following documents to
the extent that they are non-privileged within a week of this
order:
•
Purchase and sale agreements regarding all PHL policies
Tiger has acquired (RFP No. 4);
•
Transaction memoranda regarding all completed or
contemplated purchases of PHL policies (RFP No. 12);
•
Documents reflecting due diligence performed by Tiger
regarding the purchase of PHL policies (RFP Nos. 13 and
37);
•
Final version of the document titled “AMT Capital:
Procedure and Controls” (Def. Memo. at 6); and
•
Agreements with third parties who assisted Tiger in the
acquisition, consulting, administration, monitoring, or
serving of the PHL policies, including the final,
executed copy of the Madison agreement (Def. Memo. at 67).
The
defendant
also
requests
that
the
Court
allow
the
depositions of Tiger’s Rule 30(b)(6) witnesses to be reopened in
order to address documents that were belatedly produced and to
enlarge the time for taking these depositions.
n.1).
(Def. Memo. at 4
The plaintiff does not oppose this request.
I am not
authorized to extend the time for taking deposition but will permit
the defendant to reopen the deposition of Tiger witnesses for the
limited purpose of addressing documents that were produced after
the witnesses were deposed.
See Sentry Insurance A Mutual Co. v.
Brand Management Inc., Nos. 10 CV 347, 11 CV 3966, 2012 WL 6617357,
at *7 (E.D.N.Y. Dec. 19, 2012) (reopening deposition of witness who
was deposed prior to production of documents for limited purpose of
questioning
witness
on
those
documents);
4
Briese
Lichttechnik
Vertriebs GmbH v. Langston, No. 09 Civ. 9790, 2012 WL 3084520, at
*5 (S.D.N.Y. July 26, 2012) (noting plaintiff may reopen deposition
of witnesses).
B.
Privilege Log
PHL contends that Tiger has waived its claim of privilege and
work product protection for the 200,000 documents collected from
Mr. Unger because it has failed to produce a privilege log in
eleven months since receiving the RFP. (Def. Memo. at 7-8). Tiger
asserts that it is still in the process of reviewing potentially
privileged documents, including those of Mr. Ungar. (Manela Decl.,
¶ 8).
A party that withholds documents on the ground of privilege
must submit a log describing the documents so that the claim of
privilege can be assessed.
Fed. R. Civ. P. 26(b)(5)(A).
Rule
26.2(b) of the Local Rules of the United States District Courts for
the Southern and Eastern Districts of New York provides that the
privilege log “shall be furnished in writing at the time of the
response to such discovery or disclosure, unless otherwise ordered
by the Court.”
At the same time, “[w]hile failure to provide a
privilege log in a timely manner may result in a waiver, [o]nly
flagrant
violations
require
such
an
outcome.”
Grand
River
Enterprises Six Nations, Ltd. v. King, No. 02 Civ. 5068, 2009 WL
63461, at *3 (S.D.N.Y. Jan. 12, 2009) (second alteration in
original)
(internal
quotation
marks
and
citations
omitted).
“Whether waiver is warranted depends on such factors as the length
of the delay, the willfulness of the transgression, and the harm to
5
other parties.”
Dey, L.P. v. Sepracor, Inc., No. 07 Civ. 2353,
2010 WL 5094406, at *2 (S.D.N.Y. Dec. 8, 2010) (citing Schiller v.
City of New York, 245 F.R.D. 112, 118 (S.D.N.Y. 2007)).
Since the plaintiff has not redacted or withheld any document
on the ground of privilege thus far (Seessel Decl., ¶ 15) and is
still in the process of reviewing Mr. Unger’s documents (Manela
Decl., ¶ 8), it has not waived privilege. However, the plaintiff’s
failure to begin reviewing Mr. Ungar’s documents until July 2013
–-
while
identifying
him
as
an
individual
likely
to
have
discoverable information in its Rule 26(a)(1) disclosures on June
15, 2012 –- is not acceptable.
Accordingly, Tiger shall produce a
privilege log within one week of the date of this order and is
cautioned that failure to do so will result in a finding that it
has waived privilege.
C.
Deposition of Barry Zyskind
The plaintiff objects to the deposition of Mr. Zyskind on the
grounds that it would be redundant and that he has no unique
information that cannot be obtained from persons who have already
been or will be deposed.
(Pl. Memo. at 4-7).
While a senior executive like Mr. Zyskin is not immune from
discovery,
protection
“‘[c]ourts
for
depositions.’”
have
senior
recognized
corporate
an
additional
executives
layer
subject
of
to
Guzman v. News Corp., No. 09 Civ. 9323, 2012 WL
2511436, at *1 (S.D.N.Y. June 29, 2012) (alteration in original)
(quoting Alex & Ani, Inc. v. MOA International Corp., 10 Civ. 4590,
2011 WL 6413612 (S.D.N.Y. Dec. 21, 2011)); see Chevron Corp. v.
6
Donzinger, No. 11 Civ. 691, 2013 WL 1896932, at *1 (S.D.N.Y. May 7,
2013) (noting that senior executives are not exempt from deposition
except in compelling circumstances).
Although there is a split of
authority on which side bears the burden of proof, courts consider
whether the proposed deponent has personal and unique knowledge of
the relevant facts.
Compare Burns v. Bank of America, 03 Civ.
1685, 2007 WL 1589437, at *3 (S.D.N.Y. June 4, 2007) (“Unless it
can be demonstrated that a corporate official has some unique
knowledge of the issues in the case, it may be appropriate to
preclude a deposition of a highly-placed executive while allowing
other
witnesses
with
the
same
knowledge
to
be
questioned.”
(internal quotation marks and brackets omitted)) with Malletier v.
Doonev, 04 Civ. 5316, 2006 WL 3476735, at *12 (S.D.N.Y. Nov. 30,
2006) (“[I]f a party seeks to depose a very senior official of an
adversary entity, the adversary may obtain an order vacating the
deposition notice if it can demonstrate that the proposed deponent
has no personal knowledge of the relevant facts and no unique
knowledge of those facts”); cf. Fermin v. Rite Aid of New York, No.
11 Civ. 12, 2012 WL 364035, at 2 n.1 (S.D.N.Y. Feb. 3, 2012)
(noting inconsistency in this court as to which side bears the
burden
of
proving
unique
knowledge
and
finding
more
correct
approach is allocating burden on party resisting deposition).
Even assuming that Tiger bears the burden of proof, it has
shown that Mr. Zyskind possesses no unique knowledge of the
relevant facts.
According to Mr. Zyskind, he “can provide no
unique knowledge as to any of the issues in this litigation or
7
unique knowledge as to life settlement or the PHL policies” and his
knowledge
of
the
relevant
facts
is
based
on
what
has
been
information provided by Mr. Bahier, Mr. Powers, and Mr. Unger, all
of whom have been or will be deposed.
(Affirmation of Barry D.
Zyskind dated Aug. 16, 2013 (“Zyskind Aff.”), ¶¶ 6-7; Pl. Memo. at
5).
Mr. Bahier also testified that, contrary to the defendant’s
assertion, Mr. Zyskind does not chair the transaction committee
that makes decisions regarding Tiger’s life settlement business.
(Pl. Memo. at 5).
Further, as the CEO of AmTrust –- a company
whose assets total over $9 billion –- it is unlikely that Mr.
Zyskind possesses unique knowledge regarding Tiger’s business
dealings unknown to Mr. Bahier, the manager of Tiger, which is 50%
owned
by
AmTrust
and
valued
at
less
than
$105
million,
or
approximately 1% of AmTrust’s assets.
The defendant has not produced any evidence to the contrary.
Rather, the evidence the defendant points to only bolsters Tiger’s
assertion that Mr. Zyskind was merely advised of the status of
assets and opportunities and did not play an active role in Tiger’s
life settlement business or in its acquisition of the Policies.
(Defendant’s Reply in Support of Its Motion to Compel Production of
Documents and Appearance at Noticed Deposition (“Reply”)).
First, the defendant points to the fact that Mr. Zyskind was
present
at
prospective
memoranda
purchasing.
transaction
purchase
regarding
of
committee
life
life
meetings
insurance
insurance
concerning
policies
policies
and
the
received
available
for
(Deposition Transcript of Mark E. Schultze dated Aug.
8
14, 2013, attached as Exh. C to Declaration of Ben V. Seessel dated
Aug. 21, 2013 (“Seessel Decl. II”), at 47, 162, 165).
However, Mr.
Zyskind did not chair the transaction committee, and his presence
at the meetings alone does not suggest that Mr. Zyskind possessed
unique knowledge.
Second, the defendant points to the testimony of Stephen
Farrier of Madison Strategic Partners (“Madison”), which negotiated
Tiger’s
first
purchase
of
life
insurance
policies
and
which
monitors and services Tiger’s portfolio of life insurance policies.
Mr. Farrier testified that he communicates with Mr. Zyskind about
once a month regarding “the state of [the] market[] and the
opportunities to purchase policies” and that he met once with Mr.
Zyskind prior to Tiger’s first purchase of life insurance policies.
(Deposition Transcript of Stephen Farrier dated Aug. 19, 2013.
(“Farrier Tr.”), attached as Exh. A to Seessel Decl. II, at 140142).
However, this only suggests that Mr. Zyskind was advised of
the general market and the opportunities, not that he possesses any
unique knowledge regarding Tiger’s life settlement business or of
its acquisition of the Policies.
Third, the defendant asserts that Tiger employee Christopher
Powers testified that he regularly consults with Mr. Zyskind
regarding
Tiger’s
life
settlement
business.
(Reply
at
8;
Deposition Transcript of Christopher J. Powers dated Aug. 5, 2013
(“Powers Decl.”), attached as Exh. B to Seessel Decl. II, at 27).
The
defendant
overstates
Mr.
Powers’
testimony.
Mr.
Powers
testified that Mr. Zyskind “walk[s] around the office and just
9
stop[s] by” and characterized his interaction with Mr. Zyskind as
“really quite informal.”
(Powers Decl. at 27).
Again, this at
best shows that Mr. Zyskind was advised of the relevant facts.
Lastly, the defendant points to an e-mail exchange between Mr.
Zyskind
and
Louis
Kreisberg,
a
principal
at
Madison,
addressed apparent friction between Mr. Bahier and Madison.
which
(E-
mail of Barry Zyskind dated June 29, 2012 (“Zyskind e-mail”),
attached as Exh. D to Seessel Decl. II).
But Mr. Zyskind’s e-mail
merely states that he is “not familiar with these emails” and that
he will have to first speak with Mr. Bahier.
(Zyskind e-mail).
Contrary to the defendant’s assertion, this only bolsters Tiger’s
contention that Mr. Zyskind was removed from Tiger’s day-to-day
business dealings.
Thus, none of the evidence the defendant points to indicates
that Mr. Zyskind possesses unique knowledge of relevant facts not
known
to
witnesses
Accordingly,
the
who
were
defendant’s
deposed
request
or
to
will
compel
be
Mr.
deposed.
Zyskind’s
deposition is denied.
Conclusion
For the reasons set forth above, PHL’s motion to compel
(Docket no. 45) is granted in part and denied in part as set forth
above.
Tiger shall produce the remaining responsive documents and
a privilege log within one week of the date of this order.
10
SO ORDERED.
f· -:f fMA';'
rj
~
]t=
JAMES C. FRANCIS IV
UNITED STATES MAGISTRATE JUDGE
Dated: New York, New York
August 26, 2013
Ira S. Lipsius, Esq.
Phillip M. Manela, Esq.
Lipsius Benhaim Law, LLP
14 Penn Plaza
Suite 500
New York, NY 10122
Brian P. Perryman, Esq.
Jason H. Gould, Esq.
Waldemar J. Pflepsen, Jr., Esq.
Jorden Burt LLP
1025 Thomas Jefferson St., N.W.
Suite 400 East
Washington, D.C. 20007
Raul A. Cuervo, Esq.
Jordan Burt LLP
777 Brickell Ave., Suite 500
Miami, FL 33131 2803
Stephen J. Jorden, Esq.
Ben V. Seessel, Esq.
Jorden Burt LLP
175 Powder Forest Drive
Simsbury, CT 06089
Patrick J. Feeley, Esq.
Jonathan R. Montcalm, Esq.
Dorsey & Whitney LLP
51 West 52nd Street
New York, NY 10019
11
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?