United States District Court, S.D. New York
MEMORANDUM AND ORDER
JAMES C. FRANCIS, IV, Magistrate Judge.
Leo Valencia has applied for reconsideration of my February 24, 2014 Memorandum and Order, granting the motion to compel filed by the defendant, the Estate of Marilyn Monroe (the "Estate"). See A.V.E.L.A., Inc. v. Estate of Monroe, No. 12 Civ. 4828, 2014 WL 715540 (S.D.N.Y. Feb. 24, 2014). For the following reasons, reconsideration is granted, but I adhere to my prior determination.
In its Motion for Sanctions for Discovery Misconduct and to Compel Discovery, the Estate outlined what it contended constituted grave misconduct on the part of AVELA and Mr. Valencia in evading discovery obligations. The primary thrust of the motion was to preclude AVELA from offering evidence relating to (1) documentation supporting any claims of intellectual property ownership in Marilyn Monroe images and (2) elements of cost in deduction with respect to the Estate's disgorgement of profits remedy. As an alternative, the Estate sought production of the evidence in dispute, as well as documentation of the counter-defendants' licensees, both foreign and domestic. (Memorandum of Law in Support of Defendant/Counter-Plaintiff the Estate of Marilyn Monroe, LLC's Motion for Sanctions for Discovery Misconduct and to Compel Discovery ("Counter-Pl. Memo.") at 21-22). The Estate also sought additional sanctions under Rule 37 and pursuant to the Court's inherent power. (Counter-Pl. Memo. at 22-24)
On February 24, 2014, I issued a Memorandum and Order, largely granting the Estate's motion to compel, although declining to preclude evidence or order other sanctions. AVELA, 2014 WL 715540, at *10. I observed that, several hours before filing their opposition to the motion, the counter-defendants produced several of the requested categories of discovery, including artist files, copyright deposit materials, copies of checks from AVELA to V International, and a printout of the website www.radio-days.info including images offered for licensing. Id. at *4. After determining that preclusion was unwarranted at this stage in the litigation, I ordered the counter-defendants to produce: a list of worldwide licensees; a list of all financial institutions where AVELA or Mr. Valencia maintained accounts, including accounts in the name of other business entities; the underlying financial records demonstrating revenues, sales, costs, and deductions associated with Marilyn Monroe artwork (including new copies of the recently produced checks); and any further documentation supporting their claims of intellectual property in the Marilyn Monroe images AVELA offered for licensing. Id. at *10. As the motion to compel had been granted, I also required the counter-defendants to bear the Estate's costs associated with the motion. The counterdefendants were ordered to comply within thirty days of the date that the discovery stay then in place was lifted. On March 14, 2014, plaintiff's newly-retained counsel filed this motion for reconsideration.
A. Legal Standard
A motion for reconsideration is governed by Rule 6.3 of the Local Rules of the United States District Courts for the Southern and Eastern Districts of New York and is committed to the sound discretion of the court. Idowu v. Middleton, No. 12 Civ. 1238, 2013 WL 371657, at *1 (S.D.N.Y. Jan. 31, 2013). "The standard for granting such a motion is strict, and reconsideration will generally be denied unless the moving party can point to controlling decisions or data that the court overlooked - matters, in other words, that might reasonably be expected to alter the conclusion reached by the court.'" Space Hunters, Inc. v. United States, 500 F.Appx. 76, 81 (2d Cir. 2012) (quoting Shrader v. CSX Transportation, Inc. , 70 F.3d 255, 257 (2d Cir. 1995)). Generally, reconsideration "requires an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.'" Capitol Records, Inc. v. MP3tunes, LLC, No. 07 Civ. 9931, 2013 WL 1987225, at *1 (S.D.N.Y. May 14, 2013) (quoting Virgin Atlantic Airways Ltd. v. National Mediation Board , 956 F.2d 1245, 1255 (2d Cir. 1992)). "A party seeking reconsideration may neither repeat arguments already briefed, considered and decided, nor advance new facts, issues or arguments not previously presented to the Court." Ferring B.V. v. Allergan, Inc., No. 12 Civ. 2650, 2013 WL 4082930, at *1 (S.D.N.Y. Aug. 7, 2013) (internal quotation marks omitted). Reconsideration remains "an extraordinary remedy to be employed sparingly in the interest of finality and conservation of scarce judicial resources." Hinds County, Mississippi v. Wachovia Bank N.A. , 700 F.Supp.2d 378, 407 (S.D.N.Y. 2010) (internal quotation marks omitted).
B. Reconsideration of Compelled Production
Rule 26 authorizes parties to obtain "discovery regarding any matter, not privileged, which is relevant to the subject matter involved in the pending action, " as well as all information "reasonably calculated to lead to the discovery of admissible evidence." Fed.R.Civ.P. 26(b)(1). The counter-plaintiff is correct that the initial disclosures mandated by Rule 26(a) do not require the disclosing party to produce actual documents "until the other party wishes to obtain access to the [referenced] documents by either a formal or informal discovery request." Coppola v. Bear Stearns & Co., 1:02-CV-1581, 2005 WL 3159600, at *7 (N.D.N.Y. Nov. 16, 2005). Rule 26(e), meanwhile, imposes an obligation to timely supplement or correct discovery responses either when a party "learns that in some material respect the disclosure or response is incomplete or incorrect" or "as ordered by the court." Fed.R.Civ.P. 26(e).
Here, the Estate followed the initial disclosures by AVELA and Mr. Valencia with requests, both formal and informal, for the information they s ubsequently sought to co mpel. (The Estate of Marilyn Monroe, LLC's Memorandum of Law in Opposition to A.V.E.L.A., Inc.'s and Leo Valencia's Motion for Reconsideration of Order Compelling Discovery and Awarding Attorneys' Fees at 8; Plaintiff A.V.E.L.A., Inc.'s Response to Defendant's First Set of Requests for Documents ("AVELA Response"), attached as Exh. B to Declaration of Gina L. Durham dated Dec. 19, 2013 ("Durham Decl."), Response Nos. 4-5, 8-12, 14, 18-22; Cross-Defendant Leo Valencia's Responses to Defendant the Estate of Marilyn Monroe, LLC's First Set of Requests for Production of Documents to Cross-Defendant Leo Valencia ("Valencia Response"), attached as Exh. N to Durham Decl., Response No. 3). In most cases, the counter-defendants agreed to produce all responsive documents but then contended that such documents could not be located. (AVELA Response, Response Nos. 4-5, 14, 18-22; Valencia Response, Response No. 3; E-mail of Melissa Woo dated Dec. 4, 2013 ("Woo 12/4/13 E-Mail"), attached as Exh. V to Durham Decl.; Counter-Pl. Memo. at 1). AVELA also responded that, after a reasonable search and inquiry, there were no documents responsive to the Estate's request for a printout of AVELA-operated websites displaying AVELA licensed products. (AVELA Response, Response No. 46). This posture, according to the Estate, allowed the counter-defendants to contend that they were compliant with their discovery obligations yet prevented the Estate from pursuing a motion to compel. (Counter-Pl. Memo. at 1).
"Where one party fails to respond to a discovery request, or provides evasive or incomplete responses, the aggrieved party may seek an order to compel disclosure or discovery." Glencore Denrees Paris v. Department of National Store Branch 1, No. 99 Civ. 8607, 2008 WL 4298609, at *4 (S.D.N.Y. Sept. 19, 2008) (citing Fed.R.Civ.P. 37(a)); In re Teligent, Inc. , 358 B.R. 45, 61 (Bankr. S.D.N.Y. 2006).It is up to the party seeking to compel production to "cast doubt" on the responding party's representation that they have conducted a reasonable and adequate search for responsive documents. Gary Friedrich Enterprises, LLC v. Marvel Enterprises, Inc., No. 08 Civ. 1533, 2011 WL 2623458, at *1 (S.D.N.Y. June 21, 2011); see also Trilegiant Corp. v. Sitel Corp. , 272 F.R.D. 360, 368 (S.D.N.Y. 2010) (where requesting party could not specify documents opposing party failed to produce, "no basis for ordering [opposing party] to respond more fully to these requests"). The Estate carried its burden by pointing to inconsistencies in deposition testimony and undisclosed licensees, among other evidence. In addition, the production of several categories of documents in response to the filing of the motion to compel undermined the counter-defendants' claims that such information could not be found.
1. Intellectual Property Rights to Marilyn Monroe Images
In its first request for document production, the Estate formally requested documents identifying each and every copyright registration or application for works incorporating images of Marilyn Monroe, as well as documents demonstrating AVELA's rights to use third-party works featuring Marilyn Monroe (i.e., the "artist files"). AVELA responded that it would produce nonprivileged responsive documents in its possession, custody, or control. (AVELA Response, Response Nos. 4-5). It did produce several copyright registrations. The Estate then requested, through e-mail, the deposit materials associated with such registrations. (E-mail of Nicole Chaudhari dated Sept. 10, 2013, attached as Exh. C to Durham Decl.). AVELA's then-counsel responded, on September 10, 2013, that she had "requested the deposit copies and [would] produce" them. (E-mail of Melissa Woo dated Sept. 10, 2013, attached as Exh. D to Durham Decl.). Despite this confirmation, the deposit materials were not produced. The Estate also ...