On March 27, 2017, the Commercial Division of the New York Supreme Courts updated its rule on trial length, giving judges the express authorization to impose time limits, at their discretion, on different phases of trial. The goal of this amendment, first proposed by the Commercial Division Advisory Council in October 2016, is simple: to promote shorter, more efficient trials.
In late 2016, the Commercial Division Advisory Council proffered a proposed rule, Proposed Rule 11-h, which would amend Rule 216.1(a) of the Uniform Rules for Trial Courts in New York to define the “good cause” under which court records could be sealed. “Good cause” to seal court records, as defined by the proposed rule, “may include the protection of proprietary or commercially sensitive information, including without limitation, (i) trade secrets, (ii) current or future business strategies, or (iii) other information that, if disclosed, is likely to cause economic injury or would otherwise be detrimental to the business of a party or third-party.” The Advisory Council has explained that the revised rule is designed to “clarify and highlight” that “the protection of proprietary sensitive business information in commercial disputes is an appropriate goal of, and ‘good cause’ for, sealing of selected documents or portions of documents filed in the course of litigation.” This is in keeping with a principal goal of the Advisory Council: to further enhance the reputation of the Commercial Division as a business friendly court.
This month, the Office of Court Administration publicized three proposed changes to the NY Commercial Division Rules that received slightly less attention than the publication of the infamous Donald Trump/Billy Bush videotape and more ‘Wikileaked’ Hillary Clinton campaign emails. As with the changes we’ve discussed in previous posts, these proposed rules are designed to enhance efficiency, decrease costs, and promote the Commercial Division as a hospitable forum for commercial litigants. The three new proposals are discussed below.
As outlined in previous posts, the New York Commercial Division seeks to be a forward-thinking forum that adopts rule changes aimed at increasing efficiency and decreasing litigant costs. In August, a revised Model Preliminary Conference Order form was adopted for optional use by Division judges, even though the previous Preliminary Conference Order form had been approved only two years ago. The need for a revised form highlights the rapid changes in Commercial Division rules and the Division’s continuous efforts to stay up to date. The new form incorporates specific descriptions of many of the recently adopted rules and contains significant revisions to the sections governing pre-answer motion practice, document production, interrogatories, depositions, disclosure disputes, and e-discovery. This post discusses four of the more significant rule changes that are reflected in the new form.
The Commercial Division of the Supreme Court of the State of New York recently adopted a new form of confidentiality order that eliminates the option to e-file documents redacted for confidentiality without a motion to seal. The new confidentiality form, which became effective on July 1, 2016, requires the “Producing Party” who originally designated the documents as confidential to file a motion to seal promptly after any party files redacted copies of the documents. This puts an end to the option of avoiding filing a motion to seal – an alternative that many attorneys had found convenient when confidential information was submitted to the court on a motion or at trial. The effect of the new rule will likely be to expose more confidential information used in litigation to public scrutiny, or to drive up the cost of avoiding such public exposure, or both.
A producer and a distributor entered into an agreement to sell shoes in Australia. The contract contained broad New York choice of law and venue provisions. When relations soured, the distributor brought suit in an Australian court, which declined to enforce either the venue or choice of law provision finding that doing so might deprive the plaintiff of a remedy it could obtain under Australian law. Should a New York court enjoin the distributor from continuing its Australian lawsuit?
Justice Saliann Scarpulla of the Commercial Division of New York County’s Supreme Court recently confronted this difficult question of international law in Madden International, Ltd. v. Lew Footwear Holdings Pty Ltd.. It was clear that Madden, a US company, had insisted on the New York forum and New York law provision in the contract. Instead of receiving the benefit of its bargain Madden found itself embroiled in a lawsuit in Australia, with Lew Footwear successfully arguing Australian law should be applied, and that the suit should go forward in Australia.
The New York Supreme Court’s Commercial Division has developed a reputation as a forward-thinking forum at the state level for the resolution of complex business disputes. When possible, the Commercial Division promulgates rule changes to increase efficiency and lower litigant costs.
This post discusses two proposed changes to the Commercial Division Rules that were recently open to public comment: 1) an amendment concerning memorialization of rulings in disclosure conferences; and 2) an amendment regarding settlement conferences before a justice other than the justice assigned to hear the case.