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Court Of Appeals Settles Division Among New York Courts Regarding Non-Party Subpoenas

April 14, 2014 • Posted By Victoria Kennedy • Complex Litigation

In what is likely to come as a surprise to many practitioners, on April 3, 2014 the Court of Appeals decided that CPLR 3101 (a)(4) does not require litigants seeking discovery from non-parties to first show that the information could not be obtained by other means.  This decision, Matter of Kapon v. Koch, 2014 NY Slip Op. 032327, agrees with how the First and Fourth Departments have ruled, and is contrary to the positions taken by the Second and Third Departments.

William Koch, a plaintiff in a California action, served a subpoena on non-party New York resident John Kapon for testimony and information to be used in the California action against California resident Rudy Kurniawan.  Kapon brought a special petition to quash the subpoena pursuant to CPLR 2304, on the basis that party depositions had not been yet gone forward in California, and the subpoena in New York County Supreme Court did not specify why the non-party information was necessary.  Further, at the time, a case was still pending in New York between Koch and Kaplon in New York on the same subject matter as the California action, and the discovery cutoff deadline in the New York action had already passed.  Therefore, Kapon argued that Koch was seeking an end run around the discovery deadline in the New York action.

The New York County Supreme Court denied Kapon’s petition to quash, and the First Department affirmed.  In further affirming the lower courts, the Court of Appeals explained that CPLR 3101(a)(4) only requires that a party show that the requested discovery is “material and necessary” to the action, and does not require that the party first demonstrate the information cannot be obtained from other parties or sources.              

The Appellate Division has been divided on this issue for over twenty years since a 1984 amendment to CPLR 3101(a)(4).  The amendment removed the requirement that non-party discovery could only be obtained by court order and upon a showing of special circumstances.  Yet, even though the Court of Appeals decision might have resolved this division, some may still question whether the Court’s ruling is correct for several reasons.  First, although the First and Fourth Departments have generally aligned with Kapon, those decisions have been neither uniform nor unanimous, as the Court of Appeals acknowledged.  Second, non-parties, who are often not familiar with all of the claims and defenses in the underlying action, are less likely to know whether the discovery requests are “material and necessary,” are now at a distinct disadvantage when moving to quash.  Third and more importantly, Kapon appears to lessen the burden on one seeking non-party discovery as compared to party discovery.  After all, before plaintiffs can obtain discovery from a defendant, they must get jurisdiction over that party and their claims must otherwise pass CPLR 3211(a).  Similarly, the Courts very rarely grant pre-litigation discovery pursuant to CPLR 3102(c), which places a high level of scrutiny on discovery demands to persons that have not yet been named in a suit and properly served with process. 

The impact of the Kapon ruling is significant, and it will be interesting to see how non-party subpoenas are tested against this decision in future cases.