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Posted: August 26, 2014

Court Grants Summary Judgment Even Though Defendants Sought More Discovery

On August 15, 2014, Justice Whelan of the Suffolk County Commercial Division issued a decision in Flax v. Shirian, 2014 NY Slip Op. 51229(U), rejecting a request to defer decision on a motion for summary judgment pending further discovery.

In Flax, the plaintiffs sought partial summary judgment on their claims in a business divorce action. Among the grounds advanced by the defendants in opposition to the motion was that the “motion [wa]s premature due to the absence of discovery.” The court rejected that argument, explaining:

CPLR 3212(f) permits a party opposing summary judgment to obtain affidavits or discovery when it appears that facts supporting the position of the opposing party exist but cannot be stated. The rule provides that should it appear from affidavits submitted in opposition to the motion that facts essential to justify opposition may exist but cannot then be stated, the court may deny the motion or may order a continuance to permit affidavits to be obtained or disclosure to be had and may make such other order as may be just. A resort to the rule may be successful where the opposing party has not had a reasonable opportunity for disclosure prior to the making of the motion.

Nevertheless, appellate case authorities have long instructed that to avail oneself of the safe harbor this rule affords, the claimant must offer an evidentiary basis to show upon an evidentiary basis, that discovery may lead to relevant evidence or that the facts essential to justify opposition to the motion were exclusively within the knowledge and control of the plaintiff. In addition, the movant must show that his or her ignorance was unavoidable and that reasonable attempts were made to discover the facts which would give rise to a triable issue of fact, as the mere hope or speculation that evidence sufficient to defeat a motion for summary judgment may be uncovered by further discovery is an insufficient basis for denying the motion.

Here, the defendants failed to meet this standard. Their submissions failed to include affidavits or some other evidentiary basis indicating that discovery might lead to relevant evidence. Nor was it established that facts essential to justify opposition were exclusively in the knowledge of the plaintiffs as the defendants’ familiarity with the terms of the Operating Agreement and their knowledge and participation in the events, occurrences and transactions that form the basis of the plaintiff’s claim of dissolution that is premised upon the failure of unanimous consent provision of such agreement belie such a claim warrant the rejection of any claim of prematurity in the plaintiffs’ motion. Moreover, the absence of any claim of non-[*10]compliance with court ordered discovery coupled with defendants’ failure to move for compliance with their outstanding discovery demands or for any of the other remedies afforded by CPLR Article 31 prior to the interposition of this motion, militate against a finding that the defendants were denied a reasonable opportunity to engage in pre-motion discovery that would lead to the discovery of relevant evidence.

(Internal quotations and citations omitted) (emphasis added). Another way to couch the basis for decision here is to say that court’s are most usually guided by practical realities, and if you cannot show the court why sometihng–like additional discovery–matters, it is unlikely that the court will be swayed by the formalistic argument that it has not occurred.

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