Court Permits Limited Post-Note Of Issue Discovery Despite Untimely Motion To Vacate Note Of Issue

Posted: October 5, 2026 / Written by: Samuel L. Butt / Categories Discovery/Disclosure, Court Rules/Procedures

Court Permits Limited Post-Note Of Issue Discovery Despite Untimely Motion To Vacate Note Of Issue

On September 2, 2026, in Python Financial Solutions, Inc. v. SDCK I LLC, Index No. 653659/2025, Justice Robert R. Reed granted in part defendant’s unopposed motion to vacate the note of issue, permitting limited post-note of issue discovery without vacating the note of issue.

Plaintiff filed its note of issue on June 23, 2026, while the Court’s in-camera review of two documents plaintiff had withheld as privileged was still pending, and a footnote in the filing acknowledged that the parties were awaiting the Court’s ruling. Defendant moved to vacate the note of issue eight days after the 20-day deadline set by 22 NYCRR 202.21(e), and the Court thereafter ordered plaintiff to produce the two documents. Because the motion was untimely, defendant had to satisfy the more stringent standard of 22 NYCRR 202.21(d), which requires a showing of unusual or unanticipated circumstances and substantial prejudice. The Court held that defendant had not made that showing, even though discovery was concededly incomplete when the note of issue was filed. Nonetheless, the Court explained:

That failure notwithstanding, trial courts are authorized, as a matter of discretion, to permit post-note of issue discovery without vacating the note of issue, so long as neither party will be prejudiced (see Pickering v Union 15 Rest. Corp., 107 AD3d 450 [1st Dept 2013]). Although defendant here fails to demonstrate actual “unusual or unanticipated circumstances” that merit vacating the note of issue, defendant has identified how it would be prejudiced if it were foreclosed from using non-privileged evidence at trial, or in connection with dispositive motion submissions or at oral argument on such motion(s). Further, though not so-ordered by the court, the docket reflects that the parties did stipulate to a request to extend the deadline to file dispositive motions in light of the court’s on-going in-camera review (NYSCEF doc. no. 45). Given the circumstances present here, the court grants leave for limited post-note of issue discovery related solely to inquiries involving, or arising logically from, the production of documents PYT0003056 and PYT003004, which were ordered to be produced by plaintiff to defendant following in-camera review by the court (AAEB5 Fund 17, LLC v Duval & Stachenfeld, LLP, 247 AD3d 631, 633 [1st Dept 2026]). The court perceives no prejudice that could result from such continued discovery (see, e.g., Dominguez v Manhattan & Bronx Surface Tr. Operating Auth., 168 AD2d 376, 376-377 [1st Dept 1990]).

The Court directed that the permitted discovery be completed by October 1, 2026, and denied the motion in all other respects.

The attorneys at Schlam Stone & Dolan LLP have significant experience litigating in New York’s Commercial Division. Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning motions to vacate a note of issue or post-note of issue discovery.

To read more about vacating a note of issue and obtaining discovery after a note of issue has been filed, see Schlam Stone & Dolan’s related Commercial Division Blog posts on a decision holding that post-note of issue discovery should have been permitted where the movant showed unusual or unanticipated circumstances and a decision declining to vacate a note of issue where issues left open by a special referee could be decided on summary judgment or motions in limine.