Teachey v. Equinox Holdings, Inc.

Background

The parties filed competing letter motions concerning Michael Shkreli’s affidavit, which Gregory Teachey submitted in opposition to Equinox Holdings, Inc.’s motion for summary judgment. Shkreli was a former Equinox employee. Equinox initially moved to strike the affidavit under Federal Rule of Civil Procedure 37, stating that its counsel had not had an opportunity to depose Shkreli during discovery. The dispute involved statements by Teachey’s counsel in July 2019 that it represented Shkreli and Equinox should not contact him, followed by a November 2019 statement that counsel did not represent Shkreli and could not accept service of a subpoena.

On November 6, 2020, the court allowed the parties to reopen discovery for the limited purpose of permitting Teachey to assist Equinox in obtaining Shkreli’s deposition as a possible cure or mitigation of the alleged Rule 37 violation. The court held the summary-judgment motion and sanctions issues in abeyance.

The affidavit and requested relief

Equinox’s counsel attempted to serve Shkreli with a subpoena, but Shkreli refused service and refused to allow the process server into his apartment building. In a November 19, 2020 email, Equinox’s counsel summarized a conversation in which Shkreli reportedly said that he did not want to participate in the litigation, did not remember the events involving Teachey’s employment from February 2017 to January 2018, and could not testify at trial consistently with his July 2019 declaration. Shkreli replied that he confirmed the statements in the email.

Equinox argued that the affidavit should be disregarded because Shkreli would not testify consistently with it at a deposition or trial. Teachey asked the court to order Shkreli’s deposition under threat of contempt or, alternatively, to allow briefing on the affidavit’s admissibility.

Court’s analysis

The court explained that Rule 56(c)(4) requires an affidavit or declaration used to support or oppose summary judgment to be based on personal knowledge, state facts admissible in evidence, and show that the person providing it is competent to testify about the stated matters. The court also cited Second Circuit authority requiring an implicit or explicit showing that the person who submitted the affidavit is prepared to testify consistently with it.

The court stated that events after Shkreli submitted the affidavit indicated that he might not be prepared to testify consistently with it. The court also stated that Shkreli had not been subpoenaed and had not otherwise been brought before the court, so the court was not prepared to direct his testimony and questioned whether it had the power to do so.

Order and effect

The court kept discovery open for the limited purpose of allowing Teachey to serve Shkreli with a subpoena to appear for an in-person or remote deposition. Teachey had until January 31, 2021, to take the deposition if he wished, and was required to file a letter reporting its status by February 5, 2021. The Clerk of Court was directed to close Docket No. 61. The court granted Equinox leave to reopen its summary-judgment motion by filing a letter by February 12, 2021; if Equinox did so, the court would treat the previously filed papers as the summary-judgment briefing and decide the motion. The opinion does not state a final ruling on the summary-judgment motion or expressly state a final ruling on whether the affidavit was admissible.