Freeman v. Deebs-Elkenaney
- Colleen McMahon
- 1:22-cv-02435
- U.S. District Court · Southern District of New York
- 3
In Freeman v. Deebs-Elkenaney, Judge Netburn granted Prospect’s protective-order motion, delaying net-worth discovery until after summary judgment.
Prospect Agency and Emily Sylvan Kim were protected from the requested net-worth discovery for the time being. Lynne Freeman may not seek to compel that discovery before a decision on any summary-judgment motion, although the court said she may file a later motion to compel.
What happened
In Freeman v. Deebs-Elkenaney, Lynne Freeman sued her former literary agent, Prospect, over alleged fraud, fiduciary-duty and contract violations, and copyright infringement. She alleged that Prospect provided drafts and other materials from her work to Tracy Wolff and others, who copied them into the Crave book series.
Freeman sought discovery about Prospect’s net worth to support a possible punitive-damages award. Prospect asked the court to block that discovery, arguing that it was too late, too early, and otherwise improper. The court noted that punitive damages generally require serious misconduct and, for several of Freeman’s claims, harm directed at the public.
The court granted Prospect’s protective-order motion for now and barred the requested discovery before a decision on any summary-judgment motion. Judge Sarah Netburn said Freeman could later file a motion to compel, but not before that decision.
The detailed version
- Freeman v. Deebs-Elkenaney · No. 1:22-cv-02435
- Colleen McMahon
- Feb. 24, 2023
Background
Lynne Freeman sued Emily Sylvan Kim and Prospect Agency, referred to together as “Prospect,” on claims including fraud and deceit, breach of fiduciary duty, fraudulent concealment, breach of contract, copyright infringement, and related theories. The opinion states that Prospect was Freeman’s literary agent. Freeman alleged that Prospect provided draft manuscripts and other materials from her work to Tracy Wolff and others, who then copied and incorporated them into the Crave book series.
Freeman sought discovery into Prospect’s net worth to help assess punitive damages. Prospect moved for a protective order, which is an order limiting or preventing discovery. Prospect argued that the request was too late because discovery was scheduled to close on March 15, 2023, too early because punitive-damages discovery should not occur before trial, and otherwise improper. Freeman responded that courts routinely allow this type of discovery before trial and that it was appropriate here.
Court’s Analysis
The court noted that federal courts in the Second Circuit are divided over whether financial information relevant to punitive damages may be disclosed before trial. It also noted that the Second Circuit prefers separating the amount of punitive damages from the rest of the trial when appropriate and that district courts have broad discretion to manage discovery.
The court concluded that Freeman had not presented facts clearly establishing that she would be entitled to punitive damages at trial. Under the legal standards discussed in the opinion, punitive damages for Freeman’s breach-of-fiduciary-duty and breach-of-contract claims required egregious conduct directed at the public. Courts have also required public harm or especially serious misconduct for punitive damages based on fraud. The opinion further states that punitive damages are generally not available under the Copyright Act.
Balancing Freeman’s uncertain entitlement to punitive damages against Prospect’s privacy interests, the court resolved the discovery issue in Prospect’s favor.
Ruling
The court granted Prospect’s motion for a protective order at this time. Freeman may file a motion to compel later, but not before the court issues a decision on any summary-judgment motion. The Clerk of Court was respectfully requested to grant the motion at ECF No. 128.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.