Category: Commercial Division Rules & Process
Advisory Council Proposes a Series of Commercial Division Rule Changes Aimed at Enhancing the Efficiency of Commercial Litigation
In a wave of rulemaking activity over the past week, the Office of Court Administration opened public comment on three significant changes to the Commercial Division Rules proposed by the Commercial Division Advisory Council. The proposed rule changes would affect three major phases of commercial litigation: document discovery, evidentiary hearings, and motion practice. Each proposed rule change aims at enhancing the efficiency with which parties litigate in the Commercial Division.
The Westchester County Commercial Division has launched a new state-of-the-art courtroom at the White Plains Courthouse. The Integrated Courtroom Technology (ICT) part is outfitted with high-tech features designed to ease the handling of complex commercial cases and enhance the presentation of evidence.
A shareholder bringing a contested derivative claim in the Cayman Islands must seek leave from the court before proceeding. This litigation prerequisite -- imposed by Rule 12A of the Rules of the Grand Court of the Cayman Islands (“Rule 12A”) -- requires a prima facie factual showing, with the aim of protecting corporations from “vexatious or unfounded litigation.” But when a Cayman Islands-related derivative claim is brought in New York’s Commercial Division, does the same rule apply? The New York Court of Appeals recently answered “No,” holding in Davis v. Scottish Re Group Ltd. that Rule 12A is a procedural rule that does not apply to matters litigated in New York courts.
The advent of large electronic productions has propelled a proposal to adopt new language in the standard confidentiality order used in the Commercial Division. This proposal is designed to protect parties against inadvertent disclosure of privileged information. On November 15, 2017, the Administrative Board of the Courts issued a request for public comment on a proposal to amend Commercial Division Rule 11-g to include sample “privilege claw-back” language. The proposal was spearheaded by a Subcommittee of the Commercial Division Advisory Council. Comments on this proposal must be received by January 16, 2018.
Patterson Belknap Webb & Tyler LLP announced on November 20, 2017, the publication of its New York Commercial Division Practice Guide. This new publication is part of Bloomberg Law's Litigation Practice Portfolio Series, and an excerpt is available to download at: http://on.bna.com/H1KM30gCY7v. The guide is organized into various chapters drafted by Patterson Belknap lawyers, containing useful information about litigating in the Commercial Division of the New York State Supreme Court.
On August 25, 2017, Justice Shirley Werner Kornreich of the New York Commercial Division entered an order reprimanding a high-profile lawyer, Mark Geragos, for misconduct during a deposition, including refusing to answer questions in violation of the court’s explicit instructions. Gottwald v. Sebert, No. 653118/2014, 2017 BL 303419 (N.Y. Sup. Ct. Aug. 25, 2017).
In a recent decision, Justice Lawrence S. Knipel in the Commercial Division ordered an attorney to comply with a non-party subpoena and disqualified the same attorney from representing her client in the action pursuant to the Advocate-Witness Rule of the New York Rules of Professional Conduct due to the fact that the lawyer was likely to be a witness on a significant issue of fact in the case. Vanderbilt Brookland LLC v. Vanderbilt Myrtle Inc., No. 500522/2014, 2016 BL 433294 (Sup. Ct. Dec. 23 2016).
This week’s Latin lesson: in pari delicto potior est conditio defendentis means that if both parties are in the wrong, then the defendant’s position is stronger.
Rival Talent Managers’ Dispute Over American Idol Winner Phillip Phillips Stays “Home” at the California Labor Commission, Holds Commercial Division in Stay Decision
When the winner of the 11th season of American Idol, Phillip Phillips, sang “I’m going to make this place your home” on his 2012 breakout single, “Home,” he may have been predicting the petition that he would later file with the California Labor Commission (“CLC”). In that petition, Phillips sought to void the talent management agreement that he was required to sign with 19 Entertainment, Inc. – one of the now-bankrupt companies behind production of American Idol – in order to participate as a semifinalist on the show. Following a September 23, 2016 decision by Commercial Division Justice Salinan Scarpulla staying 19 Entertainment’s suit against Phillips’ new talent manager pending resolution of the California proceeding, the CLC may be “home” for 19 Entertainment’s fight over Phillips for the foreseeable future.
On August 23, 2016, Justice Eileen Bransten of the New York Commercial Division issued a decision granting a motion for spoliation sanctions in a six-year-old dispute involving Covista Communications, Inc. and Oorah, Inc., two telecommunications companies. Oorah, Inc. v Covista Communications, Inc., 2016 N.Y. Misc. LEXIS 3104 (N.Y. Sup. Ct. Aug. 23, 2016). Justice Bransten’s opinion serves as an important reminder that parties must institute a litigation hold and exercise care when erasing documents, even as part of an unrelated transaction, when they are in litigation or reasonably anticipate litigation.