Broker-Dealer Litigation - Greenberg Traurig LLP

5. Discovery
O.5
Mori v. Saito, 802 F. Supp. 2d 520 (S.D.N.Y. 2011).
The plaintiffs moved to lift the Private Securities Litigation Reform Act of 1995
discovery stay in order to serve three subpoenas upon third parties. The court denied the motion,
finding that the plaintiffs failed to satisfy any of the conditions for lifting the stay. The
subpoenas failed to identify the records sought, and thus were not sufficiently particularized.
Although the plaintiffs had shown that the named defendants may have been involved in
destroying records, they made no showing that the third-party banks targeted by the subpoenas
were doing the same, and thus lifting the stay was not necessary to preserve evidence. Finally,
the court rejected the plaintiffs’ attempts at justifying the requests with their alleged need to
identify other investors, what happened to their money, and to obtain evidence supporting
prejudgment attachment, finding these contentions insufficient to show the necessary undue
prejudice.
Litwin v. OceanFreight, Inc., 2011 WL 5223022 (S.D.N.Y. Nov. 2, 2011).
In connection with a request for a temporary restraining order and preliminary injunction
aimed at enjoining a special shareholder meeting scheduled by the defendant to consider a
merger proposal, the plaintiff moved for expedited discovery of a broad array of materials
relating to the proposed transaction. The court denied the request, holding that the plaintiff had
failed to show the necessary probability of success or injury. The discovery requests were
deemed unreasonable due to their sheer volume and breadth, and the defendant had represented
that it was taking appropriate steps to preserve all relevant materials, and therefore the materials
would be available to the plaintiff in the future if needed.
Plumbers and Pipefitters Local Union No. 630 Pension Annuity Trust Fund v. Arbitron, Inc.,
2011 WL 5519840 (S.D.N.Y. Nov. 14, 2011).
Resolving a discovery dispute, the district court granted the defendant’s motion to
compel the lead plaintiff to disclose the names of the eleven former employees designated in the
complaint as “confidential informants.” The court rejected the plaintiff’s argument that it had
complied with its discovery obligations by producing a list of 83 current or former employees
likely to have discoverable information, which included the names all 11 informants but did not
identify them as such. The court also held that these names were not protected by the work
product doctrine. Given the plaintiff’s expressed concern with retribution by the employer,
however, the court permitted the plaintiff time to submit an affidavit setting forth particularized
facts that might support this concern sufficiently to justify non-disclosure or entry of a protective
order.
O.5
O.5
375