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Kremsky v. Kremsky

United States District Court, E.D. Pennsylvania

January 3, 2017



          KEARNEY, J.

         Over twenty-five years ago, the Supreme Court amended the Federal Rules of Civil Procedure to allow attorneys to issue court orders known as subpoenas compelling third parties to produce documents without a Court's pre-approval. Given the significant power permitted in compelling third parties to produce often sensitive financial information, the Rules of Civil Procedure require the attorney issuing the subpoena provide prior, not contemporaneous, notice to opposing parties before serving the subpoena. With this key protection, opposing parties can timely seek judicial relief before a third party quickly responds. Litigation by ambush, while easier in the short term, only multiplies proceedings and may require uncomfortable disclosures to clients when fees and costs relating to two subpoenas seeking the same information are billed. As always, it is simply easier to follow the Rules of Civil Procedure. When, as here, a party does not do so by serving his adversary two days after serving the third parties, we grant a motion to quash the improperly issued subpoena without prejudice.

         I. Facts

         Stanton Kremsky alleges his nephew Kenneth Kremsky breached fiduciary duties and committed fraudulent and negligent misrepresentation and conversion while managing his uncle's financial, real estate, and precious metal investments.

         On October 5, 2016, we held a Rule 16 pre-trial conference and entered a scheduling order setting a December 16, 2016 discovery deadline.[1] On December 8, 2016, Plaintiff moved to extend discovery, the settlement conference, and dispositive motion deadlines.[2] On December 9, 2016, we extended the discovery deadline to January 16, 2017.[3]

         While simultaneously moving to extend discovery on December 8, 2016, Plaintiff also served subpoenas for the Defendant's financial records from casinos and banks: TD Bank, Bank of America, Parx Casino, SugarHouse Casino, Sands Casino, Ballys Casino, Borgata Casino, Caesars Casino, Golden Nugget Casino, Harrah's Casino, Resorts Casino, Tropicana Casino, Citibank, Citizen's Bank.[4] Plaintiffs counsel Norman W. Briggs, Esq. and Adrienne Chapman, Esq. failed to provide Defendant with notice of these fourteen subpoenas although they filed a discovery extension motion with notice the same day.

         After 2:00 A.M. on December 10, 2016, Attorneys Briggs and Chapman emailed the fourteen December 8, 2016 subpoenas to Defendant's counsel with no explanation.[5]Defendant's counsel demanded Plaintiff clawback the subpoenas because Plaintiff served the subpoenas on December 8, 2016, two days before Plaintiff gave notice of the subpoenas. Plaintiff refused to do so. When we required Attorneys Briggs and Chapman to file a certification explaining their conduct, they affixed blame on their paralegal who deviated from office policy which requires notice to opposing counsel after the courier picked up the subpoenas for service.

         II. Analysis

         Defendant moves to quash the fourteen subpoenas arguing Attorneys Briggs and Chapman violated Fed.R.Civ.P. 45(a)(4)'s prior notice requirement. We grant the Defendant's motion in the accompanying Order but do not find the bad faith or egregious disregard necessary for monetary sanctions.

         The Supreme Court, through the 1991 Amendments to Fed.R.Civ.P. 45, trusted attorneys as officers of the Court to issue subpoenas. This change made life easier for attorneys but it also granted attorneys access to the power of the Court and with it the attendant responsibility and liabilities.[6] "The risks attached to the misuse of the subpoena power are great. Under this delegation of public power, an attorney is licensed to access, through a non-party with no interest to object, the most personal and sensitive information about a party."[7]

         When an attorney signs and issues a subpoena, he or she assumes the liability and responsibilities for misuse of the Court's subpoena power.[8] A supervising attorney assumes the liability and responsibilities for his or her subordinate attorney's and paralegal's violations and an attorney "cannot escape liability for this abuse of process by pointing to the inexperience of a subordinate."[9]

         Fed. R. Civ. P. 45(a)(4) requires a party serving a non-party subpoena to provide prior notice and a copy of the subpoena to all parties.[10] "The term 'prior notice' means notice prior to service of the subpoena on the non-party, rather than prior to document production.[11] "By failing to receive prior notice of the information sought from the non-party, a party is deprived of its greatest safeguard under the Rule, i.e., the ability to object to the release of the information prior to its disclosure....Moreover, the injury resulting from attorney misuse of the subpoena power is not limited to the harm it inflicts upon the parties. Rather, misuse of the subpoena power also compromises the integrity of the court's processes."[12]

         "Courts generally respond to Rule 45(b)(1) violations by striking the subpoenas or allowing opposing counsel an opportunity to object."[13] We note some district courts review whether a party is prejudiced from the lack of notice when deciding to quash a subpoena.[14] We recognize, as of today, no subpoenaed party produced responsive documents. As such, Defendant's counsel timely moved to quash and we are able to timely review and act.

         While we understand a lack of prejudice has some role in measuring the sanction, we cannot permit lawyers to issues subpoenas without prior notice to obtain information under the invalid use of judicial authority. While we are not aware of responsive document production, we can (as we are not so far removed from the practice of law) appreciate the agita and immediate steps necessary when an opposing counsel discovers a third party has been subpoenaed without his knowledge. The Rules are specifically designed to avoid this harm, including Fed.R.Civ.P. 1 's mandate upon both lawyers and judges "to secure the just, speedy, and inexpensive determination" of this family dispute. Judge Robreno aptly explained why the "no harm, no foul" defense to misuse of subpoena power is not limited to the party lacking prior notice to object but harms the public at large.[15] "Rather, misuse of the subpoena power also compromises the integrity of the court's processes. Under Rule 45, an attorney, as an officer of ...

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