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Ocello v. City of New York

March 20, 2008


The opinion of the court was delivered by: Sifton, Senior Judge.


Plaintiff Raffaele Ocello ("Ocello") commenced this maritime action against defendants City of New York ("City"), Skanska USA, Inc., Skanska USA Construction Services, Inc., Skanska USA Building Inc., and Barney Skanska, Inc. (collectively "Skanska") pursuant to the Jones Act, 46 U.S.C. § 30104 et seq. Plaintiff later amended his complaint, adding defendants Gates Construction Corporation ("Gates"), Great Lakes Dredge and Dock Company, Great Lakes Drege and Dock Company LLC (collectively "Great Lakes"), and Harris Structural Steel Company, Inc. ("Harris").*fn1 Plaintiff seeks damages, maintenance, cure, and attorneys' fees.

Presently before this Court are the objections of defendants Gates and Great Lakes to Magistrate Judge James Orenstein's recommendation to (1) strike the answer of Gates and Great Lakes; (2) terminate as moot plaintiff's motion for lesser sanctions; (3) enter a default judgment against Gates and Great Lakes with respect to all claims pending against them; (4) dismiss Gates' and Great Lakes' outstanding counterclaims; and (5) terminate as moot Gates' and Great Lakes' motions for leave to implead third-party defendants and to impose discovery-related sanctions against Ocello and Harris. For the reasons set forth below, I adopt Magistrate Judge Orenstein's Report and Recommendation.


The following facts are taken from the Amended Complaint, the parties' submissions in connection with the instant motions, and the record of the prior proceedings before Judge Orenstein. Disputes are noted.

In 2005, plaintiff Ocello was employed by the City as a seaman on the Staten Island Ferry, which docks at the City-owned St. George Terminal, Staten Island.

On March 9, 2005, while offloading passengers from the Guy V. Molinari vessel at the St. George Terminal, a section of railing fell from the apron (a device lowered from the dock to the ferry), striking and injuring Ocello on the head and upper body.

On September 5, 2005, plaintiff commenced this action. During the course of discovery, plaintiff learned that the City had conducted an investigation of his accident. The report issued in connection with the investigation found that the railing in question had most likely been improperly welded to the apron during dock construction that took place between 1995 and 1996. The report stated that defendant Gates was the general contractor in charge of the construction and defendant Harris was a subcontractor responsible for fabricating parts off-site. Upon learning these facts, on May 1, 2006, plaintiff filed an amended complaint, adding defendants Gates, Great Lakes, and Harris. Amended Complaint, DE 20.

On June 23, 2006, Gates and Great Lakes made their initial appearance in this case, when their counsel, Marshall, Dennehey, Warner, Coleman & Goggin, attended the discovery planning conference before Judge Orenstein. Counsel informed the court that defendant Gates was no longer in existence and that defendant Great Lakes had acquired Gates, although he did not know the details of the acquisition. June 23, 2006 Transcript ["June 23 Tr."] at 11-12, DE 80. Counsel stated that he anticipated having difficulty meeting any discovery demands because he did not know the location of Gates' records and did not "have a live body for Gates." Id. at 11. Judge Orenstein warned counsel that if Gates failed to provide discovery because the client could not be located a recommendation to strike the answer and enter a default would be made. Id. at 14.

That same day, Gates and Great Lakes filed their answer, denying plaintiff's allegations that Great Lakes had acquired Gates' assets and liabilities on or about 1991. Answer ¶¶ 38, 39, DE 27. Gates and Great Lakes also filed cross-claims against their co-defendants alleging, inter alia, that the contract between Great Lakes, Gates and the other defendants required the other defendants to secure liability insurance policies that covered "work to be performed by defendants Great Lakes Dredge and Dock Company, L.L.C. and Gates Construction Corporation." Answer, p. 7.

On November 7, 2006, plaintiff informed the court that neither Gates nor Great Lakes had responded to his discovery demands. Letter from Rafaelle Ocello, DE 38. At the November 9, 2006 status conference before Judge Orenstein, Gates' counsel informed the court that the documents plaintiff requested might be found in Chicago. Declaration of Cynthia Goldman, ¶ 5, DE 92. Gates was ordered to "produce information about its insurance coverage pursuant to Rule 26(a) no later than November 16, 2006, and . . . produce the documents and information responsive to all outstanding discovery requests no later than November 23, 2006." Civil Conference Minute Order, DE 39.

On November 15, 2006, the City requested Gates and Great Lakes to produce "[a]ll documents relating to the assumption of liabilities of Gates . . . by Great Lakes . . ." Request for Production of Documents, p. 3, DE 98.

On November 16, 2006, Gates and Great Lakes submitted a copy of their insurance policy for the period between October 2004 and October 2005, and supplemented their initial Rule 26 disclosure statement, in which they identified Joseph McIlhnney ("McIlhinney") as an "individual likely to have discoverable information relevant to the disputed facts." Supplement Disclosure Statement, p.1, Defendant City Exhibit C, DE 92. McIlhinney's contact information was listed as c/o Great Lakes. Id.

On November 30, 2006, after Gates and Great Lakes failed to comply with the court's discovery order, plaintiff filed a motion to compel disclosure and sanction them. DE 44. Plaintiff sought a recommendation to strike their answer or an order precluding the presentation of evidence related to liability at trial.

Counsel for Gates and Great Lakes responded to plaintiff's motion, stating that Great Lakes had purchased the shares of Gates in 1991 and that Gates had been dissolved on December 31, 2001. Counsel also stated that Gates' records had been placed in a "truck body" in Staten Island and that the records were destroyed by water damage and discarded prior to the commencement of the action against Great Lakes and Gates. Affidavit of John R. Geraghty, December 5, 2006, ¶¶ 5-8, DE 45.

On December 4, 2006, Great Lakes and Gates responded to plaintiff's interrogatories. Great Lakes and Gates Exhibit J, DE 83. That same day counsel for Great Lakes and Gates learned of McIlhinney's contact information and on December 8, 2006, counsel initiated contact with him. June 20, 2007 Transcript ["June 20 Tr."] at 35 and 41, DE 121.

Counsel for the parties exchanged emails on December 12, 2006, at which time plaintiff's counsel asked counsel for Gates and Great Lakes if he had anyone with knowledge about the disputed facts who could be produced for a deposition. Gates and Great Lakes' counsel did not inform plaintiff about his contact with McIlhinney. Plaintiff's Exhibit I, DE 79.

On December 18, 2006, Judge Orenstein heard oral argument on plaintiff's motion, as which time counsel for Gates and Great Lakes informed the court there were no documents in existence that were responsive to the discovery demands. Counsel stated that he had been under the mistaken impression that the documents were stored in Chicago, when they had in fact been stored in Staten Island. December 18, 2006 Transcript ["Dec. 16 Tr."] at 5, DE 81. Counsel also informed the court that they did not have any witnesses. June 20 Tr. at 41-42.

Judge Orenstein denied plaintiff's motion for sanctions because defendants Gates and Great Lakes had "no further responsive records to provide and . . . any responsive records were discarded before those defendants had any reason to believe they were under any obligation to preserve them." Civil Conference Minute Order, DE 50. Judge Orenstein ...

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