United States District Court, S.D. New York
THE CITY OF NEW YORK and THE PEOPLE OF THE STATE OF NEW YORK, Plaintiffs,
FEDEX GROUND PACKAGE SYSTEM, INC., Defendant.
OPINION AND ORDER
Edgardo Ramos, U.S.D.J.
the Court are FedEx's objections to an Order issued by
Magistrate Judge Kevin Nathaniel Fox on January 15, 2016
precluding discovery of information that FedEx alleges is
relevant to its seventh affirmative defense, as well as the
City's motion to strike the seventh affirmative defense.
For the reasons discussed below, the City's motion to
strike the seventh affirmative defense is DENIED and
FedEx's objections to the January 15, 2016 Order are
SUSTAINED in part.
about March 15, 2013, approximately nine months before filing
this action, the City of New York (“City”)
entered into an agreement with FedEx Ground Package System,
Inc. (“FedEx” or “FedEx Ground”) to
settle any claims the City might have against FedEx related
to its shipments on behalf of a cigarette seller called
Cigarettes Direct to You (“CD2U”). Proshansky
Decl. (Doc. 178), Ex. 1. As part of that agreement, the City
and FedEx made certain representations. The City represented
that, aside from information about CD2U, it had “no
information . . . suggest[ing] that FedEx Ground [had]
delivered or transported unstamped cigarettes to New York
City residents or into the geographic boundaries of New York
City.” Id. ¶ 5. In turn, FedEx
represented that, aside from information about CD2U, it had
“no knowledge that it [was then] delivering or
transporting unstamped cigarettes to New York City residents
within the geographic boundaries of New York City.”
Id. ¶ 6.
parties also undertook certain obligations going forward.
FedEx agreed that “in the event that the City has a
reasonable basis to believe that any person is using FedEx
Ground to deliver unstamped cigarettes within the geographic
boundaries of New York City, ” and “upon the
City's notification of its reasonable basis and at its
request, ” FedEx would “(1) provide the City with
reasonably informative information concerning or relating to
the date, weight, and recipients' addresses for
deliveries into New York City by that person; and (2)
terminate the use of its services by that person, if such
deliveries contained unstamped cigarettes.”
Id. ¶ 7. For its part, the City agreed that if
FedEx complied with the foregoing provisions, the City would
“not pursue any claim, cause of action, lawsuit or
other demand against FedEx Ground related to shipments of
cigarettes by that person.” Id.
the course of discovery in this action, FedEx requested from
the City any materials showing that at the time the parties
entered into their agreement, the City did have other
information about FedEx's delivery of unstamped
cigarettes, contrary to the City's contractual
representation. See FedEx's Aug. 31, 2015 Ltr.
(Doc. 114) at 7. On November 17, 2015, Magistrate Judge Fox,
to whom all general pretrial matters were then assigned, held
a telephone conference to discuss, among other things, the
parties' dispute regarding the City's obligation to
produce such materials. See Nov. 17, 2015 Tr. (Doc.
136). At that conference, FedEx argued that the requested
information was relevant to its seventh affirmative defense,
which Plaintiffs had never challenged. Id. at
27:2-6. FedEx's seventh affirmative defense provides
The City's claims are barred, in whole or in part, by the
settlement agreement with FedEx Ground, effective March 15,
2013, to the extent, inter alia, the City had
any information prior to the date of that agreement,
suggesting that FedEx Ground had delivered or transported
unstamped cigarettes to New York City residents or into the
geographic boundaries of New York City, and to the extent the
City did not honor the cooperative framework established by
Am. Answer (Doc. 101) at 22.
Judge Fox requested briefing on the issue, which the parties
provided. See FedEx's Dec. 9, 2015 Ltr. (Doc.
146); City's Dec. 17, 2015 Ltr. (Doc. 148). On January
15, 2016, after considering the parties' arguments and
letter briefs, Magistrate Judge Fox issued an Order denying
“FedEx's request that the City be required to
disclose information relating to the [a]greement”
between the parties. Jan. 15, 2016 Order (Doc. 156). FedEx
thereafter requested that Magistrate Judge Fox clarify or
reconsider his ruling so that it not foreclose discovery
relevant to FedEx's seventh affirmative defense,
FedEx's Jan. 25, 2016 Ltr. (Doc. 157), but Magistrate
Judge Fox denied the request, Mar. 4, 2016 Order (Doc. 172).
March 24, 2016, FedEx filed its objections to Magistrate
Judge Fox's January 15, 2016 Order, arguing in large part
that the ruling is erroneous because the agreement between
FedEx and the City is the foundation of FedEx's seventh
affirmative defense. FedEx's Objs. (Doc. 175) at 8. In
response to FedEx's objections, the City moved to strike
the seventh affirmative defense. City's Mem. (Doc. 179).
Although the City's filing was procedurally improper,
Court permitted the City to persist in its motion. Apr. 28,
2016 Tr. (Doc. 204) at 16:22-17:3. The City subsequently
filed a corrected motion, FedEx filed an opposition brief,
and the City filed a reply. City's Corr. Mem. (Doc. 197);
FedEx's Opp'n Mem. (Doc. 206); City's Reply Mem.
Motion to Strike an Affirmative Defense
“An affirmative defense is an ‘assertion of facts
and arguments that, if true, will defeat the plaintiff's
. . . claim, even if all the allegations in the complaint are
true.'” Tradewinds Airlines, Inc. v.
Soros, No. 08 Civ. 5901 (JFK), 2013 WL 6669422, at *2
(S.D.N.Y. Dec. 17, 2013) (quoting Black's Law Dictionary
482 (9th ed. 2009)). Although a court may strike from a
pleading “an insufficient defense or any redundant,
immaterial, impertinent, or scandalous matter, ”
Fed.R.Civ.P. 12(f), “courts should not tamper with the
pleadings unless there is a strong reason for so doing,
” Lipsky v. Commonwealth United Corp., 551
F.2d 887, 893 (2d Cir. 1976). Motions to strike an
affirmative defense are generally disfavored, Cty.
Vanlines Inc. v. Experian Info. Sols., Inc., 205 F.R.D.
148, 152 (S.D.N.Y. 2002), and “will not be granted
unless it appears to a certainty that plaintiffs would
succeed despite any state of the facts which could be proved
in support of the defense, ” Salcer v. Envicon
Equities Corp., 744 F.2d 935, 939 (2d Cir. 1984)
(internal quotation marks omitted), vacated and remanded
on other grounds, 478 U.S. 1015 (1986).
prevail on a motion to strike, the moving party must satisfy
a stringent three-pronged test: “(1) there must be no
question of fact that might allow the defense to succeed; (2)
there must be no substantial question of law that might allow
the defense to succeed; and (3) the plaintiff must be
prejudiced by the inclusion of the defense.”
Specialty Minerals, Inc. v. Pluess-Staufer AG, 395
F.Supp.2d 109, 111 (S.D.N.Y. 2005). In considering the first
and second prongs, courts apply the same legal standard as
that applicable to a motion to dismiss under Rule 12(b)(6).
Coach, Inc. v. Kmart Corps., 756 F.Supp.2d 421, 425
(S.D.N.Y. 2010). The “sufficiency of a defense is to be
determined solely upon the face of the pleading, ” and
the Court “accepts as true all well-pleaded factual
allegations and draws all reasonable inferences in the
[non-moving party's] favor.” Id. In
evaluating the third prong, the Court may consider whether
inclusion of the legally insufficient defense would
needlessly increase the “time and expense of
trial” or “duration and expense of
litigation.” Id. at 426 (citing Estee