Edelson v. Edelson

• Court: Superior Court of Delaware
• Decided: January 20, 2021
• Docket: N20M-09-140
• Status: Published

Opinion

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

IN RE MARRIAGE OF:

JAY EDELSON, Petitioner,

C.A. No: N20M-09-140 vs. ISSUANCE OF FOREIGN DANA EDELSON, SUBPOENA Respondent.

Submitted: January 15, 2021 Decided: January 20, 2021

Upon Dana Edelson’s Motion to Compel Response to Out-of-State Subpoena Directed to Third Party GRANTED in part; DENIED in part

ORDER This matter is before the Court on a motion by Respondent to compel a third

party to produce documents sought in connection with an Illinois divorce

proceeding. Specifically, Respondent seeks to challenge assertions by Petitioner in

the divorce proceeding with respect to his assets, expenses and liabilities. Third-

party Bench Walk Advisors, LLC, (“BWA”) opposes the motion to compel on the

grounds that the information sought includes proprietary information.

1. BWA is a Delaware limited liability company incorporated and

headquartered in Delaware. 2. It is not disputed that Petitioner had a business relationship with BWA,

in that BWA loaned money to Petitioner which has since been paid in full.

Specifically, BWA provided litigation funding to Edelson, P.C., the law firm in

which Petitioner practices law.

3. BWA asserts that the loan document sought by Respondent contains

proprietary pricing information. According to BWA, “Pricing models are one of the

chief differences among companies in the highly competitive litigation funding

industry, and BWA guards its models zealously.”1 BWA strenuously objects to

producing documents which will disclose its proprietary pricing model. This Court

agrees that a non-disclosure agreement would not adequately protect its interest

under the circumstances presented here.

4. In an Order dated September 17, 2020, the Honorable Debra B. Walker

ordered compliance with the subpoena issued by Respondent to BWA. However,

Judge Walker acknowledged a lack of jurisdiction over BWA2 and also noted that

BWA did not appear in the Circuit Court of Cook County, Illinois, County

Department, Domestic Relations Division (“Illinois Circuit Court”).3

1 BWA’s Resp. ¶ 5. 2 Dana Edelson’s Mot. Compel. Ex. C, at 10 (Tr. at 40). 3 Dana Edelson’s Mot. Compel. Ex. D (In re Marriage of Jay Edelson, 2018 D 009047 (Sept. 17, 2020)). 2 5. Delaware Uniform Interstate Deposition and Discovery Act4 promotes

uniformity among jurisdictions with respect to discovery and depositions.

6. However, while this Court respects the ruling issued by the Illinois

Circuit Court, the issue presented here for this Court’s consideration was not fully

litigated in the Illinois Circuit Court. Due process requires full and fair consideration

of BWA’s interests before requiring disclosure of proprietary information.5 For

example, when this Court enforced a New Jersey subpoena in Adams v. Suez Water

Management & Services, Inc.,6 the issues in dispute had been fully litigated by the

New Jersey court.

7. BWA has produced all financial statements and information presented

to BWA by Petitioner. These financial documents are relevant to the divorce

proceedings and do not impact the interests of the third party. Accordingly, these

documents were properly produced.

8. Respondent is entitled to test the assertions of Petitioner with respect to

expenses claimed to offset marital assets. BWA has agreed to provide financial

information regarding the amounts disbursed in loan(s) to Petitioner and the

4 See 10 Del. C. § 4311. 5 W.L. Gore & Assocs., Inc. v. Wu, 2006 WL 905346, at *4 (Del. Ch. Mar. 30, 2006), aff’d, 918 A.2d 1171 (Del. 2007) (applying the balancing test set forth in Mathews v. Eldridge, 424 U.S. 319 (1976), to determine the amount of process due for highly confidential and proprietary information). 6 2020 WL 1082401 (Del. Super. Mar. 4, 2020), reargument denied, 2020 WL 3073083 (Del. Super. June 8, 2020). 3 amount(s) received from Petitioner as repayment. The Court finds this information

is relevant and should be produced. On the other hand, it is unduly burdensome on

a third party, such as BWA, to require production of loan documents which include

proprietary terms and conditions, especially where, as here, the relevant information

will be produced.

NOW, THEREFORE, in consideration of the parties’ written submissions,

oral argument presented January 15, 2021, the Delaware Uniform Interstate

Deposition and Discovery Act, Superior Court Rules of Civil Procedure, decisional

law, and the entire record in this miscellaneous matter, BWA shall produce all

financial statements and information presented to BWA by Petitioner as well as the

amounts disbursed in loan(s) to Petitioner and the amount(s) received from

Petitioner as repayment. The balance of the information sought is unduly

burdensome to a third party.

Accordingly, Dana Edelson’s Motion to Compel Response to Out-of-State

Subpoena Directed to Third Party is hereby GRANTED in part and DENIED

in part.

IT IS SO ORDERED this 20th day of January 2021.

Andrea L. Rocanelli _________ _______ _______ ______ _______ _______ ______ _______ _______ ______ _______ ______ _______ _______ ______ _______ _______ ______ _______ _______ ______ _______ ______ _______ _______ ______ _______ _______ ______ _______ _______ ______ _______ ______ _______ _______ ____ ____ _____ _______ _______ ______ _______ _______ ______ _______ _______ ______ _______ ______ _______ _______ ______ _______ _______ ______ _______ _______ ______ _______ ______ _______ _______ ______ _______ ___

The Honorable Andrea L. Rocanelli