Opinion
No. 218-2019-CV-198
03-17-2020
Legacy Global Sports, L. P. v. John St. Pierre, and North Atlantic Hockey, LLC d/b/a The Rinks at Exeter And Maxick, Inc.
ORDER
Defendant/Counterclaimant Plaintiff John St. Pierre ("St. Pierre") has moved for a Protective Order pursuant to Superior Court Rule 29(a), prohibiting the Plaintiff, Legacy Global Sports, L.P. ("Legacy") from obtaining documents pursuant to a subpoena issued by Legacy to Newburyport Bank ("Newburyport Bank"). For the reasons stated in this Order, the Motion is GRANTED IN PART and DENIED IN PART.
I
On January 3, 2020, Legacy issued a subpoena duces tecum (the subpoena") to the Bank, demanding production of financial information belonging to St. Pierre or any entity affiliated with him. Legacy's subpoena sought:
1) Copies of all communications between Newburyport Bank on the one hand, and John St. Pierre, Maxick, Inc., Win Win, LLC, or any of their affiliates, on the other hand, concerning any and all loans, funding, financing, credit applications, and/or financial matters concerning Selects Hockey, Legacy Global Sports, L.P., or youth sports.
2) Copies of all documents including but not limited to any term sheets,
financing applications, proformas, projections, presentations, or proposals, concerning all loans, funding, financing, credit applications, and or financial matters of St. Pierre, Maxick, Inc., Win Win, LLC, and their affiliates concerning Selects Hockey, Legacy Global Sports, L. P., and/or youth sports.
St. Pierre asserts that apart from his personal banking relationship with the Bank, the only entity with which he is associated which has an association with the Newburyport Bank is Rhombus Services, LLC, d/b/a Brandpoint Services ("Rhombus"). Rhombus is wholly owned by St. Pierre and is a retail contracting company based in New Jersey and Pennsylvania. (Mot. for Protective Order ¶ 4.) St. Pierre asserts it has no involvement in any of the events at issue in this case. (Id.) After learning of the subpoena, St. Pierre notified Legacy and the Bank, through its counsel, that he objected to the disclosure of financial information for him or any entity affiliated with him but did not object to the production of other responsive documents. Apparently Newburyport Bank declined to produce any documents until this dispute was resolved. St. Pierre proposed a procedure to Legacy and Newburyport Bank whereby:
(a) The Bank would compile documents it deems responsive to the subpoena and, before producing the documents to legacy, would allow St. Pierre to review the documents to identify projected financial information that he objects to releasing;According to St. Pierre, Legacy rejected the proposed procedure. (Id. ¶ 6.)
(b) St. Pierre would identify any documents containing protected financial information that he objects to producing. Any other responsive documents would be produced;
(c) If Legacy and St. Pierre then disagreed over whether certain information should be produced or withheld, they could address those issues to the Court.
St. Pierre asserts that the information sought by Legacy has no bearing on any "essential element in this litigation." (Id. ¶ 8.) He asserts that both he and Rhombus have a right of privacy in records containing their financial information. However, St. Pierre notified Legacy and Newburyport Bank that he does not object to the production of responsive documents that do not contain protective financial information. He offered to allow the Bank to compile the documents that it believes are responsive and then provide those documents to him for review, identifying documents which have been withheld so that Legacy could raise that issue with the Court if it disagreed with St. Pierre's determination.
Legacy has rejected this approach. It asserts that it has a "fundamental right" to take discovery concerning St. Pierre's competitive activities and, in light of his counterclaim that he may have participated in recent financing rounds, his ability and resources to do so. (Pl.'s Opp. to Mot. for Protective Order, at 2.) Legacy asserts that it is likely that relevant documents exist in Newburyport Bank, because it is in possession of an October 31, 2019 letter to St. Pierre, in which Senior Vice President John Burke of Newburyport stated that:
It was a pleasure meeting with you last week and discussing all of your various business endeavors. I greatly appreciated your time and the opportunity to talk with you about how the Bank can continue to assist you with future ventures.(Pl.'s Opp. to Mot. for Protective Order, Ex. A.)
As a most valued client of the Bank who is held in very high professional regard, the Bank would be very interested in supporting a witness financing for your possible acquisition of the Selects Hockey business from Legacy Global Sports. This financing would be subject to our customary review of all financial data pertaining to the proposed transaction.
Legacy argues that Newburyport is a potential material witness to both the nature of St. Pierre's "various business endeavors" and the resources with which St. Pierre, with or without the help of Newburyport Bank, would have been able to participate in recent financing rounds, as he claims he may have done if Legacy had provided him with more financial information. (Pl.'s Opp. to Mot. for Protective Order at 2.) It argues, in substance, that its subpoena is relevant, because it would provide information about St. Pierre's supposed competitive activity, and that the subpoena is not unreasonably broad, because it is restricted to documents "concerning Selects Hockey, Legacy Global Sports, and/or Youth Sports." (Pl.'s Opp. to Mot. for Protective Order at 10.) It argues in the alternative that the materials would shed light on St. Pierre's allegations that he had a financial capacity to participate in recent rounds of financing, which are part of his Counterclaim. (Id.) Finally, Legacy argues that the documents are likely to "shed light on St. Pierre's motives and credibility." (Id.)
II
Discovery has been described as the "fusion of law and equity." Reynolds v. Burgess Sulfite Fibre Co., 71 N.H. 332, 345 (1902). Equitable treatment of discovery allows for the "orderly dispatch of judicial business," which benefits litigants and conserves judicial resources. McDuffey v. Boston & Maine R.R., 102 N.H. 179, 182 (1959). "The underlying purpose of discovery. . . is to reach the truth and to reach it as early in the process as possible by narrowing the issues pertaining to the controversy between the parties." Kurowski v. Town of Chester, 170 N.H. 307, 315 (2017) (citations omitted). A party's request for discovery must appear relevant and "reasonably calculated to lead to the discovery of admissible evidence." Super. Ct. Civ. R. 21(b); Scarborough v. R.T.P. Enterprises, Inc., 120 N.H. 707, 711 (1980). While discovery in New Hampshire has traditionally been liberal, the trial court is "permitted to keep discovery within reasonable limits and avoid 'open-ended fishing expeditions' or harassment to ensure that discovery contributes to the orderly dispatch of judicial business." N.H. Ball Bearings v. Jackson, 158 N.H. 421, 430 (2009) (citations omitted). A court must limit discovery where the discovery is (1) "unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive;" (2) "the party seeking discovery has had ample opportunity to obtain the information by discovery in the action; or" (3) "the burden or expense of a proposed discovery outweighs its likely benefit," taking into account the needs of the case the amount in controversy the parties resources the importance of the issues at stake in the litigation and importance of the projected discovery in resolving the issues. See U.S.C.S. Fed. R. Civ. Proc. R. 26(b). The trial judge's tools to manage discovery are outlined in Superior Court Rule 21(d).
Bank records are not privileged. However, the New Hampshire Supreme Court has recognized that a person has a right of privacy, at least to some extent, with respect to his or her financial records, which may be sufficiently important to prohibit a party from obtaining access to the records even if they are reasonably likely to lead to admissible evidence. Sawyer v. Boufford, 113 N.H. 627, 630 (1973). In Sawyer, the court held that a defendant could not be compelled to disclose his financial situation prior to adjudication of his liability in a tort case, because "[t]he benefit which would result to the plaintiff from a disclosure by facilitating the decision to settle or go to trial is considerably outweighed by the unwarranted invasion of the defendant's right of privacy in this area." Id. at 629-630. Lower courts, relying upon Sawyer, have generally held that financial records, while not privileged, should generally be shielded from discovery unless the party seeking them can demonstrate relevance. Carlisle v. Granite State Anesthesiologists, P.A., 2015 WL 10662821, at * 2 (N.H. Super. October 15, 2015) (Colburn, J.). If a showing of relevance is made, courts may sua sponte limit dissemination of such records. See e.g., Bennett v. O'Connell, 2014 WL 11392993, at *4 (N.H. Super. March 27, 2014) (Tucker, J.).
Legacy's claim that it is entitled to records because they are "likely to shed light on St. Pierre's motives and credibility" is hardly persuasive. In fact, it is the classic articulation of a fishing expedition. On the other hand, information relating to Selects Hockey, Legacy Global Sports, or youth sports might lead to admissible evidence. Such information is therefore plainly discoverable. Moreover, documents created by Newburyport Bank may not be in St. Pierre's possession, so that there is no alternative means for Legacy to obtain them.
Legacy argues that its subpoena is not overbroad, because it "expressly calls for production of materials concerning 'Selects Hockey, Legacy Global Sports and/or youth sports.'" (Pl.'s Opp. to Mot. for Protective Order, at 10.) However, it is by no means clear that Newburyport Bank would know whether or not materials concern Selects Hockey or Legacy Global Sports. More importantly, the term "youth sports" is not defined and could lead Newburyport bank to either produce relevant documents in an abundance of caution or fail to produce relevant documents because it is unaware of the significance of the documents.
In the circumstances of this case, a middle ground which protects Legacy's right to discovery and St. Pierre's right to privacy is required. The Court believes the proposal suggested by St. Pierre strikes the right balance. Accordingly, the Court orders as follows:
1. St. Pierre shall advise Newburyport Bank that it is to compile documents it
deems responsive to the subpoena duces tecum and, before producing the documents to Legacy, send them to St. Pierre for review; and
2. St. Pierre shall identify any documents he alleges contain protective financial information he objects to producing. St. Pierre shall provide Legacy with what amounts to a privilege log, which identifies each document by date, author, recipient, and subject. All other responsive documents shall be produced to Legacy.
3. If Legacy believes responsive documents have been withheld by St. Pierre, it may file a Motion to Compel with the Court.
Newburyport Bank has not filed an appearance in this matter but will apparently take instruction from its customer, St. Pierre. --------
SO ORDERED
3/17/2020
DATE
s/Richard B . McNamara
Richard B. McNamara,
Presiding Justice RBM/