Seccomandi v. 999 Restaurant Corp., Nello Balan, et. al.
(NYC Civil Court Civil Court, NY County, 11/3/2010)
We represented: Seccomandi
Hon. Manual J. Mendez, J.C.C.
DECISION and ORDER
Upon a reading of the foregoing cited papers, the Decision and Order on this Motion by Order to Show Cause is as follows:
The petitioner obtained a money judgment entered on May 5, 2010 for $114,000.00, in a commercial holdover proceeding involving a condominium used as a business address by the respondents. Petitioner seeks an Order punishing the non-party entity, Madison Global, L.L.C., hereinafter referred to as "Madison," for contempt of court for failing to answer a questionnaire accompanying its Information Subpoena and Subpoena Duces Tecum. The petitioner also seeks to compel Madison to comply with the subpoena and the imposition of a fine.
Madison opposes the motion by Order to Show Cause stating that it attempted to provide responses and comply with the subpoenas. Madison states that it purchased assets of two restaurants owned by the respondents with the closing taking place on August 26, 2009. It claims Nello Balan was hired pursuant to a management services agreement also entered into on August 26, 2009, and that the petitioner was given the employment information for purposes of garnishing wages. Madison also claims that the purchase agreement is proprietary, that the petitioner has refused to enter into a confidentiality agreement, and has brought this motion for contempt for purposes of harassment.
In those instances concerning civil contempt, the Court must expressly, find the person's actions were, "calculated to or actually did defeat, impair, impede or prejudice the rights or remedies a party to a civil proceeding" (See, Oppenheimer v. Oscar Shoes, inc., 111 A.D. 2d28;488 N.Y.S. 2d693 [N.Y.A.D 1st Dept., 1985] citing to Judiciary Law § 753 and Powell v. Clauss, 93 A.D.,2d 883, 461 N.Y.S. 2d 413 [N.Y.A.D. 2nd Dept., 1983]). The determination of applications for contempt lies within the discretion of the Court (See, Matter of Hildreth, 28 A.D. 2d290, 284 N.Y.S. 2d 755 [N.Y.A.D. 1st Dept. 1967]). The party seeking to hold another in contempt has the burden of proof which must be demonstrated by "clear and convincing evidence"(See, Gray v. Giarrizzo, 47 A.D. 3d 765, 850 N.Y.-S. 2d 549 [N.Y.A.D. 2nd Dept. 2008] ).
The petitioner claims that Madison acted to intentionally deprive him of the ability to collect on his judgment, when it refused to provide the asset purchase agreement. Madison provided a copy of the management services agreement entered into with Nello Balan.1 It also provided responses to the subpoena including, copies of paychecks, the name and address of respondent Nello Balan's accountant and the name of an entity he may have a financial interest in.2 The petitioner has not established that the information sought could not be obtained directly through another source, specifically the respondents. The petitioner has not sufficiently established Madison is in contempt based on its failure to provide the asset purchase agreement.
A claim of confidentiality typically involves trade secrets' and proprietary or fiduciary responsibilities. It is generally an issue of fact that requires proof the information sought is not shared outside 6fthe corporation or entity, and is secret (See, Ashland Management v. Janien, 82 NY 2d 395,604 N.Y.S. 2d 912,624 N.E. 1007 [ 1993]). Absent the existence of a confidentiality agreement between the parties to an agreement as proof that proprietary or fiduciary duty exists, there is generally no expectation of confidentiality (See, Edelman v. Starwood Capital, Inc., 70 A.D. 3d 246,892 N.Y.S. 2d 37 [N.Y.A.D. 1st Dept., 2009] and Manculich v. Dependable Auto Sales and Service, Inc., 39 A.D. 3d 1070, 833 N.Y.S. 2d 767 [N.Y.A.D. 3rd Dept., 2007]).
Madison has not provided proof that there is a confidentiality agreement between itself and the respondents or the basis for its claim that the petitioner would disclose the information to third parties in a financially detrimental manner. Madison did not sufficiently establish the manner in which the information sought "goes to the core of its business model," or that there is a need for a confidentiality agreement.
Accordingly, the petitioner's motion by Order to Show Cause to punish the non-party entity, Madison Global, L.C.C., for contempt of court is granted, but only to the extent that Madison Global L.L.C., shall provide to the petitioner copies of the asset purchase agreement dated August 26, 2009, entered into with the respondents. Madison Global, L.L.C. shall provide supplemental responses to information subpoena questions 7 and 14, within. Thirty (3D) days from the date of service of this Order with Notice of Entry. Failure of Madison Global, L.L.C. to do so, shall result in a finding of contempt. The petitioner's application for punishment and fines is denied.
This constitutes the Decision and Order of this Court.
Dated: November 3, 2010
Hon. MANUELJ. MENDEZ
Judge, Civil Court
1 A copy of the Management Services Agreement is annexed to the opposition papers as "Exhibit 3."
2 A copy of Madison Global LLC's Objections and responses to the subpoenas are annexed.