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MacCartney v. O'Dell

United States District Court, S.D. New York

February 27, 2017

HAROLD Y. MacCARTNEY, JR., Plaintiff,
KEVIN D. O'DELL and CHRISTOPHER J. WALSH, individually and doing business as MacCARTNEY, MacCARTNEY, KERRIGAN & MacCARTNEY, LAW OFFICE OF KEVIN D. O'DELL, P.C., and WILLIAM K. KERRIGAN, individually and doing business as MacCARTNEY, MacCARTNEY, KERRIGAN & MacCARTNEY, Defendants.

          OPINION & ORDER


         Plaintiff Harold Y. MacCartney, Jr. brings this action alleging breach of fiduciary duty, breach of New York partnership law, unjust enrichment, and an accounting claim arising out of the dissolution of a former law practice partnership.[1] Before the Court are objections by Defendants Kevin O'Dell and Kevin O'Dell, P.C. (the "O'Dell Defendants") to Magistrate Judge Davison's July 19, 2016 Oral Decision (the "July Decision"), which granted, in relevant part, full disclosure of cases managed independently by the O'Dell Defendants and not referred to MMKM, the firm where both Plaintiff and O'Dell Defendants formerly worked. For the following reasons, Defendants' objections to the July Order are DENIED.


         The Court assumes familiarity with the factual background of this case as set forth in the February Order, and notes only the following relevant facts, which are not in dispute.

         Plaintiff brings this action to recover money allegedly owed as part of a payout resulting from his withdrawal as a partner from his former law firm, MMKM. On February 29, 2016, as to the O'Dell Defendants, this Court dismissed all but the unjust enrichment claim. (See February Order.) On June 22, 2016, the O'Dell Defendants filed written responses to Plaintiff's First and Second Document Production Requests, which were initially served prior to the February 2016 Opinion. (See Declaration of Brian Belowich in Support of Defendants' Objection Pursuant to FRCP 72(a), Exs. G, H, I, ECF No. 102, [hereinafter (“Belowich Decl”)]; see also ECF Nos. 86-90.) On June 24, 2016, Plaintiff sent a letter to Magistrate Judge Davison in which he took issue with Defendants' responses to the production requests. (Belowich Decl. Ex. J.) Specifically, Plaintiff argued that he should be entitled to documents concerning both the cases that were referred by Defendant O'Dell P.C. to the MMKM, as well as the cases that were handled independently by the O'Dell Defendants (the “Non-Referred Cases”). (See id.; Defs.' Mem. in Support of Defs.' Objection Pursuant to FRCP 72(a), at 5, ECF No. 101, [hereinafter (“Defs.' Mem.”).)

         On July 5, 2016, the O'Dell Defendants responded to Plaintiff's letter, objecting to the disclosure of any documents concerning the Non-Referred Cases on the basis that the documents were privileged, confidential, and irrelevant to the extent that they related to causes of action dismissed in the February 2016 Opinion, that the requested documents did not relate to Plaintiff's unjust enrichment claim as pled in the Amended Complaint, and that Plaintiff is not entitled to them. (See Belowich Decl. Ex. K; Defs.' Mem., at 5-6.) On the same day, Plaintiff responded that the documents concerning the Non-Referred Cases related to his claims against Defendant Kerrigan and the amount owed to Plaintiff, and that the documents were not privileged, irrelevant, or non-discoverable. (See Belowich Decl. Ex. L.)

         On July 19, 2016, Judge Davison held a discovery conference to resolve this dispute. At the conference, Judge Davison heard arguments from both Plaintiff and the O'Dell Defendants regarding the disclosure of documents pertaining to the Non-Referred Cases, and found as follows:

[the files pertaining to the Non-Referred Cases] have everything to do with the claims that Mr. MacCartney is making with respect to Mr. Kerrigan and this alleged breach of fiduciary duty by failing to collect monies owed from your client. In other words, even if Mr. MacCartney does not have a direct claim against your client in this case, it seems to me that those [documents] are evidentiary as to the claims that Mr. MacCartney is trying to make against Mr. Kerrigan and the Kerrigan law firm. In other words, he's claiming that the firm was entitled to a cut of the cases, the income that [the O'Dell Defendants were] generating. And even if they don't want to go after him for it, he thinks that he's entitled to his cut of it… And I will point out that this is also relevant to the crossclaims which have been interposed against your client by these other defendants… It seems to me that what plaintiff has a legitimate need to know is when cases were initiated, how they were resolved and perhaps whether firms resources were utilized in prosecuting the case.

(See Belowich Decl., Ex. M, Transcript of July 19, 2016 Conference Before Magistrate Judge Davison, (“July Order”), at 21, 23, 25.) At the conference, Defendants contended that, because MMKM employees were permitted to hold employment outside of the firm, there could be no claim against Defendant Kerrigan that could support discovery of files for cases not referred to MMKM. (See id. at 22:4-11.) Recognizing that the parties dispute whether Defendant O'Dell was permitted to engage in work outside of the firm, and noting that defendants are entitled to argue that this work was authorized and that MMKM was not entitled to its proceeds, Judge Davison found that Plaintiff was still permitted to discovery with regard to “what those cases were and what kind of fees they generated.” (Id. 22:24-23:5.) Based upon this, the Judge directed the O'Dell Defendants to provide full disclosure of documents relating to both the referred and Non- Referred Cases, with the exception of documents protected by attorney-client privilege. (See id. 25:22-26:10.)

         The O'Dell Defendants subsequently filed the present motion to set aside the portion of Magistrate Judge Davison's decision regarding the disclosure of documents relating to the Non-Referred Cases. (See Def. Mem., at 7.)


         Under 28 U.S.C. §636(b)(1)(A), a district court may refer certain non-dispositive pretrial matters pending before the court to a magistrate judge for determination. An order on a discovery issue is a non-dispositive order. When a party submits objections to a magistrate judge's non-dispositive order, the district court must review the objections and “modify or set aside any part of the order that is clearly erroneous or is contrary to law.” Fed.R.Civ.P. 72(a); 28 U.S.C. §636(b)(1)(A).

         A decision is clearly erroneous where “although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.” BPP Wealth, Inc. v. Weiser Capital Mgmt., LLC, 14-CV-1848, 2015 WL 4999524, at *3 (2d Cir. Aug. 24, 2015) (summary order) (citing New York Progress & Protection PAC v. Walsh, 733 F.3d 483, 486 (2d Cir. 2013) (internal quotation marks omitted). A magistrate judge's ruling is contrary to law if it “fail[s] to apply or misapplies relevant statutes, case law, or rules of procedure.” Thai Lao Lignite (Thailand) Co., Ltd. v. Government of Lao People's Democratic Republic, 924 F.Supp.2d 508, 511-12 (S.D.N.Y. 2013) (internal citation omitted). “A showing that ‘reasonable minds may differ on the wisdom of granting the [moving party's] motion' is not sufficient to overturn a magistrate judge's decision.” Edmonds v. Seavey, 08-CV-5646 (HB), 2009 WL 2150971, at *2 (S.D.N.Y. 2009) (citing Cagle v. Cooper Cos., Inc., 91-CV- 7828 (HB), 1996 WL 514864, at *1 (S.D.N.Y. Sept. 10, 1996)). This standard affords magistrate judges “broad discretion in resolving nondispositive disputes and reversal is appropriate only if their discretion is abused.” Ritchie Risk-Linked Strategies Trading ...

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