The opinion of the court was delivered by: Dora L. Irizarry, District Judge
The litigation tactics employed in this case would test the patience of even the most forgiving federal district court judge. The problem appears to emulate from the parties' refusal to accept the finality of the court's decisions, choosing instead to make motions to reconsider and appeal the decisions of the court repeatedly. Neither party is without blame -- in fact, it seems that both plaintiffs and defendants are content to engage in procedural trench warfare on in the battlefield of discovery, with the decisions, orders and respect for the court becoming collateral damage. The aim of this Memorandum and Order is to finally resolve one of the most intractable issues in this action: what discovery is permitted from "nonparty potential class members" ("NPCM").*fn1 NPCMs are individuals who might be members of a class if certification is later granted, but who are not yet, and may never be, a party to the litigation. For the reasons set forth below, defendants' appeal from U.S. Magistrate Judge James Orenstein's Order dated May 24, 2006 denying defendants' motion for reconsideration of his denial of certain discovery is dismissed.*fn2
In this action, plaintiffs allege a scheme by defendants*fn3 to defraud cable subscribers who purchased certain cable equiptment ("pirate boxes") by falsely accusing these cable subscribers of stealing cable in an attempt to obtain a settlement, in violation of state and federal laws. Plaintiffs' strategy during the last two years focused on obtaining discovery from defendants to broaden their class by finding additional victims of the alleged scheme (NPCMs), while at the same time preventing defendants from obtaining reciprocal discovery regarding the NPCMs. Defendants, for their part, have sought the exact opposite: to prevent plaintiffs from obtaining records which would allow them to broaden their class while, at the same time, attempting to obtain reciprocal discovery from NPCMs to pick off potential plaintiffs (NPCMs) who will be unable to prove their claims, or perhaps simply to make the class certification process as onerous as possible for both the NPCMs and plaintiffs.
United States District Judge Joanna Seybert's decision of September 5, 2003 (Docket No. 46) contains the genesis of the dispute regarding what discovery should be permitted from NPCMs. The September 5, 2003 decision denied plaintiffs' motion for class certification on the grounds that the plaintiffs had failed to satisfy the numerosity requirement of Fed R. Civ. Pro. 23(a)(1) because they had not provided a reasonable estimate of the number of class members. Calabrese v. CSC Holdings, Inc., 02-CV-5171 (E.D.N.Y. Sep. 5, 2003) (Docket No. 46). Judge Seybert found that plaintiffs had not provided a reasonable estimate of the number of class members because they had defined the putative class as "CSC's cable television subscribers in New York State who have been victimized by Defendants' scheme." Id. Judge Seybert held that:
the Court finds that the only individuals 'victimized' by the Defendants' 'scheme' are those who can plead that they did not in fact use the pirate box to intercept cable programing service. Plaintiffs' putative class can therefore only consist of those individuals who will allege that they did not use the pirate boxes to intercept cable programing service. The Plaintiffs have not made any attempt to establish that there are a large number of individuals that will fit into this class, or even to 'reasonably estimate' the number. In fact, even accepting all of the Plaintiffs' allegations as true, there is no indication that the Plaintiffs' class will consist of any individuals beyond those named in the Complaint. As such, the Plaintiffs have failed to establish the numerosity requirement and no class can be certified.
Although the Plaintiffs' motion must be denied for failure to satisfy Rule 23(a)(1), the Court will deny this motion without prejudice.
Id. at 6-7. Plaintiffs initially made a motion to reconsider the September 5, 2003 order (ECF Docket No. 51), but withdrew the motion in exchange for being permitted to file a third amended complaint (ECF Docket No. 49). After serving the amended complaint, plaintiffs requested that United States Magistrate Judge Arlene R. Lindsay, then assigned to the case, allow discovery to go forward on the issue of numerosity. (ECF Docket No. 55). The defendants objected to the plaintiffs' application and requested discovery be limited to the named plaintiffs. (ECF Docket Nos. 56, 57). On October 9, 2003, Judge Lindsay permitted discovery to go forward on the issue of numerosity. (ECF Docket No. 58). Both parties appealed the magistrate judge's order. (ECF Docket Nos. 60, 65, 75). The crux of plaintiffs' objections was that the court should not allow discovery of "absent class members," later defined as NPCMs. Id. Defendants asked for reconsideration of the order because they wished to have more discovery from NPCMs. Id. On November 12, 2003, Judge Lindsey denied defendants' motion for reconsideration and ruled that plaintiffs were to provide a reasonable estimate of the number of class members as well as additional information about the NPCMs demonstrating that class certification was appropriate. (ECF Docket No. 60, Endorsed Order). Under the order, defendants were permitted additional discovery of the NPCM. Likewise, plaintiffs were permitted numerosity discovery from defendants, even after the numerosity requirement was met. Id.
On December 18, 2003, Judge Seybert issued a Memorandum and Order dismissing plaintiffs' appeal of Judge Lindsay's October 9, 2003 order. (ECF Docket No. 78). Judge Seybert reaffirmed her September 5, 2003 decision requiring plaintiffs to make a "reliable showing . . . that a substantial number of individuals can be identified who can affirmatively plead that they were defrauded by the Defendants'-- that is that (1) they did not in fact use a pirate box and (2) they did in fact rely on Defendants' representations." Id. at 4. Judge Seybert went on to state that plaintiffs are permitted discovery "to allow plaintiffs access to the information that they will need in order to make the showing required of them." Id. at 6. Similarly, Judge Seybert found that defendants have the right to discovery regarding "the claims of putative class members." Id. Concerned that the parties might construe Judge Lindsay's order "to allow the parties to engage in discovery well beyond the scope of the issues intended," Judge Seybert modified the order, directing that "[t]he parties shall narrowly tailor all discovery requests to these issues and shall not attempt to engage in discovery relating to the substance of the claims of unnamed potential class members, except to the extent the substance of the claims relates to the inclusion of said parties in the class." Id. To prevent abuse, defendants' discovery requests served on the NPCMs were required to be in writing. Id.
Plaintiffs moved for reconsideration of Judge Seybert's December 18, 2003 Memorandum and Order. (ECF Docket No. 87). On August 17, 2004, Judge Seybert issued another Memorandum and Order denying the motion to reconsider and reaffirming her prior decisions:
As Plaintiffs correctly point out, this class has not yet been certified, which precludes the potential class members from technically being classified as 'absent class members.' However, it would not be prudent to classify these potential class members as 'non-parties.' This case presents special circumstances in that Plaintiffs, on the one hand, would like to include these 'non-parties' in the putative class, but, on the other hand, wish to preclude Defendants from reciprocal discovery on the issue of numerosity concerning these same 'non-parties.' The Court does not agree with Plaintiffs' contentions and to the extent that it was unclear in the December 18, 2003 Order, the Court is clarifying that the Plaintiffs have the burden of establishing numerosity and that they may engage in discovery in order to determine whether there are individuals, other than those already named as Plaintiffs in this action, who qualify for inclusion in the class. The Court also intends that the Defendants have a reciprocal right to limited, relevant discovery concerning whether the individuals identified by the Plaintiffs as potential class members actually qualify as members of the class, so that they may have the opportunity to disprove numerosity. As such, this limited discovery may only relate to the issue of whether potential class members qualify for inclusion in the class, within the limits set forth in this, and the previous, orders of the Court.
Id. at 12. On August 27, 2004, Judge Seybert lifted the stay previously imposed on this discovery. (ECF Docket No. 155). On September 17, 2004, plaintiffs appealed Judge Seybert's August 17, 2004 Memorandum and Order to the Second Circuit. (ECF Docket No. 160).*fn4 Plaintiffs also moved for a stay of the August 17, 2004 Memorandum and Order pending the appeal, which was ultimately denied. (ECF Docket No. 168). The appeal was dismissed by the Second Circuit on February 23, 2005 for lack of jurisdiction. (ECF Docket No. 201).
The defendants' entitlement to discovery from NPCMs having been addressed, and the discovery obligations of the parties being reasonably well established, on April 7, 2005, Judge Orenstein held a discovery conference and asked the parties to provide a report addressing all outstanding discovery matters. (ECF Docket No. 221).*fn5 On the issue of discovery from NPCMs, Judge Orenstein proposed that plaintiffs identify the NPCMs by an in camera submission, ex parte, and provide a redacted version to defendants. The in camera submissions would allow potential class members to attest to their membership in the proposed class, in a form affidavit to be agreed to by both parties. Id. Predictably, plaintiffs wished to keep the identities of the NPCMs anonymous while defendants wanted disclosure of the identities of the NPCMs, ostensibly to allow the defendants to serve additional discovery on the NPCMs. (ECF Docket No., 230, 232).On May 18, 2005, Judge Orenstein ruled that plaintiffs must provide "unredacted affidavits from all potential absent class members. . . by June 16, 2005." (ECF Docket No. 236). The deadline was later extended to June 24, 2005. (ECF Docket No. 240, Endorsed Order). On June 24, plaintiffs provided thirty-four unredacted affidavits from NPCMs, each of which attested to the individual's membership in the potential class. Plaintiffs now had a putative class of forty, the minimum needed to satisfy the numerosity requirements. (ECF Docket No. 242). However, on June 29, 2005, Judge Orenstein clarified his May 18, 2005 Order and directed plaintiffs to provide unredacted affidavits from "all potential absent class members, not simply the minimum needed to satisfy the numerosity requirement for maintaining a class action." (ECF Docket No. 243). On July 27, 2005, plaintiffs provided more than sixty affidavits from NPCMs attesting to their membership in the class, as well as a list of hundreds of other NPCMs from whom plaintiffs could not get affidavits for one reason or another. (ECF Docket No. 247). Claiming that the numerosity requirement was satisfied, plaintiffs asked the court to certify the class. Id. Several additional affidavits from potential class members were provided on August 17, 2005. (ECF Docket No. 251).
Defendants, however, were not satisfied with the affidavits and sought to take additional discovery from the NPCMs, asserting that Judge Seybert's and Judge Lindsay's prior rulings permitted them to do so. (ECF Docket No. 253-254, 257, 258, 260). Plaintiffs, however, took the position that additional discovery from NPCMs was an "anathema to the very concept of Class Action litigation." (ECF Docket No. 262). On December 27, 2005, Judge Orenstein decided the issue in favor of plaintiffs and limited the defendants' discovery to "interrogatories that test the numerosity issue by seeking information about nonparty potential class members, but not from them." (ECF Docket No. 269). Defendants promptly moved for reconsideration of the December 27, 2005 order because they believed that Judge Seybert's prior orders allowed them more expansive discovery, directly from NPCMs. On March 7, 2006, Judge Orenstein granted the defendants' motion for reconsideration on the grounds that his ruling was inconsistent with prior rulings in the case made by Judge Seybert and allowed defendants to serve "limited interrogatories" directly on the NPCMs. (ECF Docket No. 287). Plaintiffs, predicably, asked for reconsideration of the March 7, 2006 Order. (ECF Docket No. 298, 306). Reconsideration was denied. (Docket No. 306). To exercise their rights to additional discovery from the NPCMs, defendants requested that the ...