Demirovic v. Ortega

254 F. Supp. 3d 386, 2017 U.S. Dist. LEXIS 86294
CourtDistrict Court, E.D. New York
DecidedMay 24, 2017
Docket15 CV 327 (CLP)
StatusPublished

This text of 254 F. Supp. 3d 386 (Demirovic v. Ortega) is published on Counsel Stack Legal Research, covering District Court, E.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Demirovic v. Ortega, 254 F. Supp. 3d 386, 2017 U.S. Dist. LEXIS 86294 (E.D.N.Y. 2017).

Opinion

MEMORANDUM AND ORDER

POLLAK, United States Magistrate Judge:

On January 21, 2015, plaintiffs Kujtim Demirovic, Richard Reinoso, Murto Avda-lovic, and Señad Perovic (collectively, “plaintiffs”) commenced this action against Franklin Ortega, Rocío Uchofen, and P.O. Italianissimo Ristorante Inc. (the “Restaurant”) (collectively, “defendants”), pursuant to the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et seq., and New York Labor Law (“NYLL”) § 650 et seq., seeking unpaid overtime and minimum wages. On September 21, 2015, all of the parties consented to have the case reassigned to the undersigned for all purposes.

Defendants filed an Answer to the Complaint on March 12, 2015, asserting counterclaims for conversion, fraud, abuse of process, unjust enrichment, defamation, and civil RICO violations. Thereafter, on March 26, 2015, defendants filed a Third Party Complaint against Elsa and Eljaz Perovic,. asserting claims for civil RICO violations, conversion, fraudulent concealment, unjust enrichment, and assault.

[388]*388On December 11, 2015, plaintiffs filed a motion to dismiss all of defendants’ counterclaims. On September 15, 2016, the Court granted plaintiffs’ motion to dismiss all of defendants’ counterclaims due to the defendants’ failure to satisfy the pleading requirements of Rule 8, Rule 9(b), and Rule 12(b)(6). The Court also denied defendants’ motion to amend their Answer, as the proposed Amended Answer remedied none of the deficiencies in the defendants’ pleading, and would thus be futile as a matter of law.

Although the parties had been engaged in written discovery since June 2015, no depositions had been taken pending a decision on the various motions. During a telephone call held on October 28, 2016, the Court Ordered the parties to complete the plaintiffs’ depositions by December 8, 2016; defendants’ depositions were to be completed by January 16, 2017, and the third parties’ depositions were to be completed by January 16, 2017.

On November 1, 2016, third-party defendants, Elsa and Eljaz Perovic, filed a letter motion to dismiss the Third Party Complaint pursuant to Fed. R. Civ. P. 12(b)(6) and 12(c). On January 31, 2017, this Court granted the motion to dismiss the third-party defendants.

Thereafter, on February 1, 2017, the Court held another discovery conference. Defendants had not conducted the third parties’ depositions in the time frame set at the October conference, but the Court granted defendants an extension to complete their depositions “within [the] next 30 days.”1 (Minute Entry 45). The Court also ordered that the parties exchange outstanding documents within the same 30-day time period. (Id.) Under this sehedul-ing Order, all depositions were to be completed by March 3, 2017.

On March 29, 2017, more than three weeks past the March 3d deadline set by the Court, during a telephone status conference before the undersigned, defendants requested another extension of time to take the depositions of the third-party defendants. Again, the Court granted defendants an extension until May 1, 2017 to complete the third-party depositions. However, the Court explicitly stated that there would be “no further extensions.” (Minute Entry 46). At that time, the Court directed that all discovery was to be completed by May 1, 2017.

On May 2, 2017, defendants’ counsel filed a letter — once again after the deadline for the completion of the depositions and all discovery — seeking yet another 45-day extension of time to conduct the third-party depositions. In a separate letter dated May 2, 2017, defendants filed a motion to compel the disclosure of plaintiffs’ income tax returns. On May 3, 2017, plaintiffs filed a letter opposing defendants’ request for plaintiffs’ tax returns and request to extend the discovery deadline, yet again.

During the telephone conference held on May 12, 2017, defendants’ counsel explained that they were seeking to compel the production of plaintiffs’ tax returns because certain plaintiffs refused to provide the necessary information that would allow defendants to file W-2 forms during plaintiffs’ employment with defendants. Defendants also requested an extension of forty-five (45) days to conduct the third-party depositions but did not provide a persuasive explanation as to why they did [389]*389not conduct these depositions earlier and why they could not have sought an extension from the Court before the deadline expired.

Plaintiffs’ counsel reiterated the arguments raised in their letter, contending that defendants’ motion for an extension of time should be denied since it was requested after the discovery deadline. Plaintiffs also objected to defendant’s motion to compel plaintiffs’ tax returns, arguing that it was defendants’ duty to record the plaintiffs’ hours worked, and maintain records and pay stubs.

DISCUSSION

A. Request for Income Tax Returns

Courts are generally reluctant to order the production of personal financial documents and have imposed a heightened standard for the discovery of tax returns. See Chen v. Republic Rest. Corp., No. 07 CV 3307, 2008 WL 793686 at *2 (S.D.N.Y. Mar. 26, 2008) (citing Smith v. Bader, 83 F.R.D. 437, 438 (S.D.N.Y. 1979) (holding that “[although tax returns are not privileged documents, Court[s] are reluctant to order them discovery in part because of the ‘private nature of the sensitive information contained therein, and in part from [sic] the public interest in encouraging the filing by taxpayers of complete and accurate returns’ ”).

A party seeking to compel production of tax returns in civil cases must meet a two-part showing that: “(1) the returns must be relevant to the subject matter of the action and (2) there must be a compelling need for the returns because the information is not ‘otherwise readily obtainable.’ ” Carmody v. Village of Rockville Centre, No. 05 CV 4907, 2007 WL 2042807 at *2 (E.D.N.Y. July 13, 2007) (citing United States v. Bonanno Family of La Cosa Nostra, 119 F.R.D. 625, 627 (E.D.N.Y. 1988)).

Here, defendants argue that plaintiffs’ tax returns are relevant to their defense because the tax returns “will reveal how much [plaintiffs] were actually paid and allow the court and all parties involved to see if the plaintiffs truly did not receive promised wages.” (Ltr. Mot.2 at 1). Plaintiffs oppose the motion to compel for several reasons, arguing that not only is the motion untimely, but that defendants are seeking plaintiffs’ tax returns to support claims that have already been dismissed and that it was defendants’ responsibility to retain records that indicate the hours worked and wages earned by plaintiffs. (Pis.’ 5/3/17 Ltr. at 1-2).

Defendants fail to explain why the total yearly earnings of a particular plaintiff would be relevant to the question of whether defendants properly paid plaintiffs for the hours they worked for defendants. To the extent that defendants seek these records to determine whether plaintiffs properly reported their income to the government, this information is irrelevant to the issue at hand. See Rosas v. Alice’s Tea Cup, LLC, 127 F.Supp.3d 4, 11 (S.D.N.Y. 2015) (citing Rengifo v. Erevos Enterprises, Inc., No. 06 CV 4266, 2007 WL 894376, at *2 (S.D.N.Y. Mar.

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Related

Anderson v. Mt. Clemens Pottery Co.
328 U.S. 680 (Supreme Court, 1946)
Santillan v. Henao
822 F. Supp. 2d 284 (E.D. New York, 2011)
Rosas v. Alice's Tea Cup, LLC
127 F. Supp. 3d 4 (S.D. New York, 2015)
Smith v. Bader
83 F.R.D. 437 (S.D. New York, 1979)
United States v. Bonanno Organized Crime Family
119 F.R.D. 625 (E.D. New York, 1988)

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Bluebook (online)
254 F. Supp. 3d 386, 2017 U.S. Dist. LEXIS 86294, Counsel Stack Legal Research, https://law.counselstack.com/opinion/demirovic-v-ortega-nyed-2017.