2:16-cv-05209
E.D.N.YJul 28, 2020Background
- Plaintiffs are trustees of multiple Local 282 union benefit funds suing DiFazio entities, Faztec, West Shore and individuals for unpaid contributions, alleging single-employer/alter-ego/double-breasting liability so non-signatory entities are jointly liable.
- Plaintiffs previously sued DiFazio Environmental in 2009; that case settled by a June 2011 Stipulation and Release that resolved claims for periods prior to August 31, 2008 but preserved Plaintiffs’ ability to allege changed circumstances after the Stipulation date.
- In this action Plaintiffs allege that, post-2011, DiFazio Environmental, DiFazio Industries, Faztec and West Shore performed covered work but only DiFazio Environmental reported hours and paid contributions.
- Faztec moved in limine to require Plaintiffs to prove “changed circumstances” since 2011 before introducing evidence on alter-ego/double-breasting/single-employer status for post-2011 periods.
- Plaintiffs moved to preclude Defendants from using documents produced after discovery closed (Faztec’s Material Analysis Report and DiFazio Industries’ daily work schedules).
- Magistrate Judge Lindsay recommended denying both motions: Faztec may be litigated on post-2011 facts without a preliminary “changed circumstances” showing; late-produced documents need not be excluded given available remedial measures and the adjournment of trial.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Plaintiffs must first prove "changed circumstances" since 2011 before offering evidence of alter-ego/double-breasting for post-2011 periods | Plaintiffs can present evidence of post-2011 status and, if facts differ from prior stipulation, rely on them | Faztec contends the 2011 Stipulation limits Plaintiffs to asserting post-2011 liability only if they first show changed circumstances | Denied — court: no evidentiary rule requires such a condition; Plaintiffs may offer post-2011 evidence and either prove altered facts or fail to establish liability |
| Whether res judicata bars relitigation of Faztec’s status | Plaintiffs argue prior stipulation did not establish preclusive effect over Faztec for post-2011 claims | Faztec argues prior litigation and stipulation preclude relitigation absent showing of changed circumstances or privity | Denied — res judicata inapplicable because Faztec was not a party to prior action and no privity shown |
| Effect of 2011 Stipulation/Release on pre-2011 claims against Faztec | Plaintiffs accept stipulation limits certain pre-2011 claims and preserved post-2011 claims | Faztec asserts broader preclusive effect | Court previously held release bars claims through June 1, 2011; remaining claims are post-2011 |
| Whether late-produced documents should be excluded for trial | Plaintiffs seek exclusion as sanction for nonproduction during discovery | Defendants explain oversight, say documents were used in settlement talks, offer expedited discovery/depositions | Denied — court weighs explanation, importance, prejudice and continuity; with trial adjourned and offer of expedited discovery, exclusion not warranted |
Key Cases Cited
- Palmieri v. Defaria, 88 F.3d 136 (2d Cir. 1996) (purpose and limits of in limine motions)
- Jean-Laurent v. Hennessy, 840 F. Supp. 2d 529 (E.D.N.Y. 2011) (evidence inadmissible only if clearly inadmissible on all grounds)
- Romanelli v. Long Island R. Co., 898 F. Supp. 2d 626 (S.D.N.Y. 2012) (definition and admissibility of relevant evidence under Rules 401–402)
- Highland Capital Mgmt., L.P. v. Schneider, 551 F. Supp. 2d 173 (S.D.N.Y. 2008) (court’s inherent authority to manage trials and resolve in limine matters)
- Allen v. McCurry, 449 U.S. 90 (1980) (res judicata bars relitigation of matters that were or could have been raised)
- Computer Assocs. Int'l, Inc. v. Altai, Inc., 126 F.3d 365 (2d Cir. 1997) (party invoking claim preclusion bears the burden of proof)
- Retirement Plan of UNITE HERE Nat. Ret. Fund v. Kombassan Holding A.S., 629 F.3d 282 (2d Cir. 2010) (alter-ego/single-employer test is flexible, fact-specific)
- Patterson v. Balsamico, 440 F.3d 104 (2d Cir. 2006) (factors for excluding evidence as sanction for nondisclosure)
- Wide Polymers, Inc. v. Shinkong Synthetic Fibers Corp., 694 F.3d 155 (2d Cir. 2012) (consider relative roles of counsel and client and tactical motive when imposing discovery sanctions)