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U.S. Information Systems, Inc. v. International Brotherhood of Electrical Workers Local Union Number 3

August 1, 2006


The opinion of the court was delivered by: James C. Francis IV, United States Magistrate Judge


The defendants in this antitrust action previously moved for summary judgment. They now seek an order striking evidence cited in the plaintiffs' brief in opposition to the summary judgment motion as well as portions of the plaintiffs' statement of facts submitted pursuant to Local Civil Rule 56.1. The defendants argue that the plaintiffs' brief and their Local Rule 56.1 statement rely upon inadmissible evidence and that, in addition, the plaintiffs' Local Rule 56.1 statement fails to comply with basic requirements of the rule. For reasons that follow, the defendants' motion to strike is granted in part and denied in part.


The plaintiffs are contractors who employ members of the Communication Works of America, AFL-CIO (the "CWA") to install low-voltage telecommunications and data ("tel-data") wiring for commercial customers. The defendants are Local Union Number 3 ("Local 3"), AFL-CIO, of the International Brotherhood of Electrical Workers (the "IBEW") and several electrical contractors employing Local 3 members. The plaintiffs allege that the defendants have engaged in a concerted effort to coerce building owners, tenants, construction managers, general contractors, information technology consultants, and others in the construction industry to exclude CWA contractors from the tel-data marketplace in violation of § 1 of the Sherman Antitrust Act,*fn1 15 U.S.C. § 1, and New York State's Donnelly Act, N.Y. Gen. Bus. Law § 340. (Second Complaint ("SC"), ¶¶ 36, 70-92). According to the plaintiffs, the defendants advance their conspiracy by, for example, threatening to withdraw manpower from construction sites as soon as CWA contractors show up for work, refusing to engage in overtime, and threatening and carrying out acts of vandalism on construction sites. The alleged purpose of all of these acts has been to convince commercial construction executives that hiring CWA contractors will result in delays and drive up costs. (SC, ¶ 41).

On August 26, 2005, the defendants filed a motion for summary judgment, arguing, among other things, that the plaintiffs do not have any evidence, except inadmissible hearsay, of an agreement among the defendants or of illegal conduct by Local 3 contractors or union agents. The defendants further contend that, even if the plaintiffs can prove a conspiracy, they cannot prove an anticompetitive effect because the tel-data market place is a highly competitive one that allows new contractors to enter and thrive. The plaintiffs responded on November 22, 2005, with a memorandum of law opposing summary judgment, pointing to Local 3's long history of unlawful conduct against the CWA and describing multiple incidents at construction job sites from which, the plaintiffs asserted, an antitrust conspiracy could be inferred.

As required by Local Civil Rule 56.1(a) of the Local Rules of the United States District Courts for the Southern and Eastern Districts of New York (the "Local Rules"), the defendants annexed a statement of material facts to their brief. (Defendants' Joint Statement of Facts About Which There Is No Genuine Dispute ("Def. Rule 56.1 Statement")). Each of the eight defendants contributed a section addressing specific allegations of misconduct. In total, the defendants' Local Rule 56.1 statement consists of 563 numbered paragraphs.

Under the Local Rules, parties opposing summary judgment must also file a statement of facts. Local Civil Rule 56.1(b). The non-moving party's statement is to respond to the facts in each of the numbered paragraphs in the moving party's statement. Accordingly, the plaintiffs here filed a Local Rule 56.1 statement with numbered paragraphs addressing each of the defendants' 563 assertions. (Plaintiffs' Response to Defendants' Joint Statement of Purported Undisputed Facts ("Pl. Rule 56.1 Statement" or "counterstatement")).

Shortly after the parties completed their summary judgment submissions, the defendants' filed this motion seeking an order to strike eighty statements in the plaintiffs' memorandum of law and nearly every entry in the plaintiffs' Local Rule 56.1 counterstatement. Their contentions can be summarized as follows:

(1) the plaintiffs rely on hearsay in their brief and their counterstatement and have failed to establish that those statements are subject to any hearsay exception; (2) they use their expert's report as a conduit for hearsay evidence in both the brief and the counterstatement; (3) they improperly rely on past judicial and agency determinations to prove Local 3's current conduct in both documents; (4) they offer documents that lack authentication; (5) their factual assertions are not supported by the evidence they cite or the evidence is irrelevant, and (6) their Local Rule 56.1 counterstatement violates the fundamental requirements of the rule.

The plaintiffs respond that statements identified as hearsay are in many instances not assertions at all but, rather, verbal acts, and that those statements that are assertions are admissible under Rule 803(3) of the Federal Rules of Evidence. They contend that they have cited their expert's report properly, even where the cited portions include hearsay, because experts are permitted to testify to opinions based on inadmissible evidence. And they argue that evidence of Local 3's battles with the CWA before the courts and the National Labor Relations Board (the "NLRB") over the years is admissible under Rule 406 of the Federal Rules of Evidence to prove that the union's conduct in this case was in conformity with its routine practices. Finally, the plaintiffs argue that the defendants have misidentified the evidentiary burden borne by plaintiffs seeking to prove an antitrust conspiracy and that proof of the illegal agreement can rest on circumstantial evidence alone.

Because the volume of statements under dispute is so large, a roadmap is in order. This memorandum addresses the legal issues raised by the defendants' motion. To the extent that analysis permits categorical decisions about disputed evidence, I have attached an appendix showing statements covered by categorical decisions. To the extent a categorical decision is not possible, I have addressed testimony and documents individually.


A. Compliance with Local Rule 56.1 The defendants seek to strike statements that they contend fail to adhere to basic requirements of Local Rule 56.1. Compliance with the rule can be determined categorically.

Local Civil Rule 56.1 provides the method by which parties are to set their factual disputes before district courts in the Southern and Eastern Districts of New York. Under the rule, assertions in the moving party's statement of material facts "will be deemed admitted for purposes of the motion unless specifically controverted by a correspondingly numbered paragraph in the statement required to be served by the opposing party." Local Civil Rule 56.1(c) (emphases in original). Every statement in the parties' Local Rule 56.1 submissions must be supported by citations to record evidence. Local Civil Rule 56.1(d). "Rule 56.1 statements are not argument. They should contain factual assertions with citation to the record. They should not contain conclusions." Rodriguez v. Schneider, No. 95 Civ. 4083, 1999 WL 459813, at n.3 (S.D.N.Y. June 29, 1999)(emphasis in original); see also Giannullo v. City of New York, 322 F.3d 139, 142 (2d Cir. 2003) (unsupported facts in moving party's Local Rule 56.1 statement disregarded); Holtz v. Rockefeller & Co., Inc., 258 F.3d 63, 74 & n.1 (2d Cir. 2001) (same).

A non-moving party cannot create a factual dispute merely by denying a movant party's factual statement; rather, the non-moving party must identify controverting evidence for the court. See Aristocrat Leisure Ltd. v. Deutsche Bank Trust Co. Americas, No. 04 Civ. 10014, 2006 WL 1493132, at *5 (S.D.N.Y. May 31, 2006); Blackmon v. Unite!, No. 03 Civ. 9214, 2005 WL 2038482, at *2 (S.D.N.Y. Aug. 25, 2005); Chimarev v. TD Waterhouse Investor Services, Inc., 280 F. Supp. 2d 208, 223 (S.D.N.Y. 2003). Moreover, plaintiffs cannot evade the impact of accepting a fact by adding legal argument to their counterstatements. Goldstick v. The Hartford, Inc., No. 00 Civ. 8577, 2002 WL 1900629, at (S.D.N.Y. Aug. 19, 2002) (defendants' motion to strike granted insofar as plaintiffs' counterstatement consisted of more than admission or denial of assertion and citation to record). This requirement goes to the very purpose of the rule, which is "to streamline the consideration of summary judgment motions by freeing district courts from the need to hunt through voluminous records without guidance from the parties." Holtz, 258 F.3d at 74. Courts rely on Local Rule 56.1 to assist them "in understanding the scope of the summary judgment motion by highlighting those facts which the parties contend are in dispute." Rodriguez, 1999 WL 459813, at *1 n.3.

The plaintiffs here give every indication of having thrown up their hands in frustration when they encountered the defendants' 563-paragraph statement. In close to four hundred and fifty responding paragraphs, the plaintiffs object --- strenuously --- to the kind and amount of material in the defendants' statement:

This is not a proper issue for inclusion in a Rule 56.1 Statement. Whether true or not it adds nothing to the determination to be made by the Court . . . . (Pl. Rule 56.1 Statement, ¶¶ 189, 191-96, 210-12, 396-99). Objection on the ground that the statement is merely the opinion of the witness, lacks foundation and is speculation, is not relevant, and is not material for purposes of a Rule 56.1. statement. (Pl. Rule 56.1 Statement, ¶¶ 295).

Objection on the ground that the cited document speaks for itself and that this is not a material fact; thus its inclusion in a Rule 56.1 statement is inappropriate. Moreover, the assertion is argumentative and self-serving and is inconsistent with actual practice. (Pl. Rule 56.1 Statement, ¶¶ 138-43).

Objection on the ground that what is "important" is merely the opinion of the declarant, there is no foundation for the assertion and it is speculative. Moreover, this is a circular, self-serving argument because defendants have, through their unlawful concerted action (including the threats of a refusal to provide overtime, threats of sabotage, threats of vandalism and the actual occurrences of such actions) fostered the concern among building owners and other end users that there might be labor disharmony if a CWA contractor is utilized on a construction project. Thus, defendants have creatred the need for dispute resolution before the Building and Construction Trade Council. If, in fact, defendants did not engage in such unlawful behavior, there would be no need to provide a mechanism to resolve it . . . . (Pl. 56.1 Statement, ¶ 113).

In over two hundred entries, the plaintiffs dispute the factual assertions in the defendants' corresponding paragraphs with objections alone. That is, they punctuate their objections with the word "disputed" and fail to cite evidence. The plaintiffs have not provided any authority for this method of contesting a moving party's Local Rule 56.1 statement, and the tactic directly violates the rule. Assuming that the plaintiffs had meritorious objections, they had an alternative to sidestepping the rule; they could have filed a motion to strike. See Glynn v. Bankers Life and Casualty Co., No. 3:02CV1802, 2005 WL 2028698, at *1 (D. Conn. Aug. 23, 2005) (motion to strike is appropriate vehicle to challenge admissibility of summary judgment materials); 11 James Wm. Moore et al., Moore's Federal Practice § 56.14[4][a] (same).

To the extent the plaintiffs proclaim factual assertions to be in dispute without identifying evidence in the record, the plaintiffs thwart the basic purpose of the rule. Therefore, the defendants' motion to strike is granted with regard to all entries in the counterstatement that purport to dispute the defendants' assertions without providing citations to the record. The paragraphs to be struck on this ground are listed in the appendix attached to this opinion under the heading Plaintiffs' Local Civil Rule 56.1 Paragraphs to be Struck. Under Local Rule 56.1(c), facts admitted by the plaintiffs' failure to properly dispute them are deemed admitted for the purposes of the summary judgment motion only.

B. Admissibility of Evidence

When ruling on summary judgment, courts need only consider admissible evidence. Raskin v. Wyatt Co., 125 F.3d 55, 66 (2d Cir. 1997) ("The principles governing admissibility of evidence do not change on a motion for summary judgment."). Rule 56(e) of the Federal Rules of Civil Procedure requires that affidavits "be made on personal knowledge, [and] set forth such facts as would be admissible in evidence." Fed. R. Civ. P. 56(e). Accordingly, courts are free to strike or disregard inadmissible statements in parties' summary judgment submissions. See Patterson v. County of Oneida, 375 F.3d 206, 219, 222-23 (2d Cir. 2004); Hollander v. American Cyanamid Co., 172 F.3d 192, 197-98 (2d Cir. 1999); United States v. Private Sanitation Industry Association of Nassau/Suffolk, Inc., 44 F.3d 1082, 1084 (2d Cir. 1995); 11 James Wm. Moore et al., Moore's Federal Practice § 56.14[4][a] (affidavits, deposition testimony, and documents containing inadmissible evidence properly disregarded).

1. Authentication

The defendants challenge the authentication of a group of documents submitted by the plaintiffs in opposition to the motion for summary judgment. (See Exhibits 11, 14-15, 24, 27-29, 33,*fn2 34, 47, and 52, attached to the Declaration of John E. Andrews in Opposition to Defendants' Motion for Summary Judgment ("Andrews Decl.")).*fn3 The plaintiffs counter that (1) the burden imposed by the Federal Rules of Evidence for authentication is a low one; (2) the fact of production during discovery implicitly authenticates documents, and the appearance of a Bates stamp number on the document is therefore sufficient to guarantee authenticity; and (3) several of the documents have been identified by witnesses at depositions.

Rule 901(a) of the Federal Rules of Evidence, which governs authentication, requires parties to provide "evidence sufficient to support a finding that the matter in question is what its proponent claims." The rule "does not erect a particularly high hurdle." United States v. Dhinsa, 243 F.3d 635, 658 (2d Cir. 2001) (citation and internal quotation marks omitted). It is satisfied "if sufficient proof has been introduced so that a reasonable juror could find in favor of authenticity or identification." United States v. Ruggiero, 928 F.2d 1289, 1303 (2d Cir. 2001) (internal quotation marks omitted). "[T]he standard for authentication, and hence admissibility, is one of reasonable likelihood." United States v. Pluta, 176 F.3d 43, 49 (2d Cir. 1999) (internal quotation marks omitted). "If in the court's judgment it seems reasonably probable that the evidence is what it purports to be, the command of Rule 901(a) is satisfied, and the evidence's persuasive force is left to the jury." Dhinsa, 243 F. 3d at 658 (citation and quotation marks omitted). Under Rule 901(b)(4), the requirements are met if the "[a]ppearance, contents, substance, internal patterns, or other distinctive characteristics, taken in conjunction with circumstances," indicate that the document is what it is purported to be.

The plaintiffs' argument that the process of discovery provides an implicit guarantee of authenticity is well-founded. In John Paul Mitchell Systems v. Quality King Distributors, Inc., 106 F. Supp. 2d 462 (S.D.N.Y. 2000), the plaintiff sought to introduce corporate records obtained from a defendant during discovery. Because the defendant's custodian of records invoked his right under the Fifth Amendment of the United States Constitution not to testify, the plaintiffs were unable to authenticate the documents through testimony. Id. at 471. The court held that the act of production itself authenticated the documents. However, the court did not rely on the presence of a Bates stamp in its analysis. Rather, the court considered the circumstances under which the defendant produced the document. There was no dispute that the defendant's custodian of records had produced the documents; that fact, along with the fact that had he testified he would have been able to authenticate the document, persuaded the court that the records were admissible. Id. at 472. Nothing in the decision provides authority for authenticating documents on the basis of the presence of a Bates stamp alone.

For reasons set forth below, the documents identified as Exhibits 11, 14, 24, 27, 28, 34 and 52 are sufficiently authenticated to be admitted for the purposes of the summary judgment motion, and with respect to them, the defendants' motion to strike is denied. It is granted with respect to one of the documents in Exhibit 29 and the correspondence identified as Exhibit 47.

Exhibit 11 was produced by IPC Communications, Inc., a defendant in this lawsuit. A party producing a document is in a better position to know whether the document is authentic than the party seeking it in discovery. It is disingenuous for the producing party to dispute the document's authentication without proffering some basis for questioning it.

Exhibit 14 is a letter dated November 29, 1999, by Harold Lyons, vice president of Lehrer McGovern Bovis, Inc., a general contractor. The plaintiffs state that the letter was produced in discovery and that it was identified by Fred Lott at his deposition on July 18, 2002. (Plaintiff's Memorandum of Law in Opposition to Defendants' Motion to Strike ("Pl. Strike Memo.") at 11.) However, the plaintiffs have not provided the court with a copy of the cited page of the deposition transcript in which Mr. Lott made the identification. Nevertheless, taking together the content of the letter, its appearance, the fact that it describes contemporaneous events and opinions, and was written before litigation began, it is reasonably probable that the letter is authentic, and it is therefore admitted.

Exhibit 15, a letter by James D. Alger dated May 26, 2000, is authenticated by a declaration, also in Exhibit 15, in which Mr. Alger identifies the document as a letter he wrote. An attachment to the letter, a handwritten memorandum written by Leo Martin, is authenticated by Mr. Alger's ...

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