Gem Financial Service, Inc. v. City of New York

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

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GEM FINANCIAL SERVICE, INC.,

doing business as Gem Pawnbrokers,

Plaintiff, MEMORANDUM AND ORDER

v. 13-CV-1686 (RPK) (RER)

CITY OF NEW YORK,

Defendant.

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RACHEL P. KOVNER, United States District Judge:

This case concerns a series of allegedly unlawful inspections that the New York City

Police Department (the “NYPD”) performed at pawnshops operated by plaintiff Gem Financial

Service, Inc. (“Gem”). See Am. Compl. (Dkt. #25). Three of Gem’s claims against the City of

New York (the “City”) under 42 U.S.C. § 1983 and state law survived summary judgment. See

Order dated Mar. 29, 2018 (Dkt. #93) (“Summ. J. Order”). With a jury trial in this case

scheduled to start on April 11, 2022, the parties have filed several motions in limine. For the

reasons stated below, plaintiff’s motion to admit Harold Dambrot’s affidavit is denied, and

defendant’s motions are granted in part and denied in part.

BACKGROUND

I assume familiarity with the facts of this case, see Summ. J. Order at 2-12, which I

describe here only as needed to address the pending motions.

Gem is a licensed collateral loan broker and second-hand dealer that operates multiple

retail stores throughout New York City. Id. at 2-3. Pawnbrokers like Gem are subject to state

law and the City’s supervisory authority. See id. at 3; see, e.g., N.Y.C Charter § 436. State law

requires collateral loan brokers to keep records of pawned items, see N.Y. Gen. Bus. Law § 43,

and the NYPD may require a pawnbroker to submit similar reports, see N.Y.C. Admin. Code

§ 20-277(b).

In 2010, the NYPD started encouraging pawnbrokers to use LeadsOnline, an Internet

database for recording pawn transactions. Summ. J. Order at 3. Gem used LeadsOnline in 2010

but stopped in February 2011. Id. at 2-3. After Gem stopped using LeadsOnline, the NYPD

allegedly visited Gem stores more frequently, threatened Gem and its employees, and issued

Gem seven criminal summonses. Id. at 4-5.

Gem also alleges that the NYPD improperly seized or required Gem to hold pledged

items. Id. at 5. The NYPD never secured a warrant to seize any item from Gem between 2010

and June 21, 2016 and has never obtained a warrant to search a Gem store. Id. at 6. But the City

argues that Harold Dambrot, Gem’s former Senior Vice President for Legal Matters, consented

to every seizure and hold request. See id. at 7.

In 2013, after Gem filed this suit, New York City passed Local Law 149, which amended

the City Code to require electronic reporting of pawn transactions. See id. at 10.

Gem and Gem’s majority shareholder filed this case against the City, the NYPD, and

John Doe police officers on March 28, 2013. See Compl. (Dkt. #1). The initial complaint

alleged that defendants “violated the [plaintiffs’] civil rights and denied [them their]

constitutional liberties” and deprived Gem of equal protection by singling Gem out as a “class of

one” under 42 U.S.C. § 1983, deprived plaintiffs of their civil rights as guaranteed by the New

York Civil Rights Law (“NYCRL”), maliciously prosecuted plaintiffs, and tortiously interfered

with plaintiffs’ business. Id. ¶¶ 82, 91, 95-99, 103-14, 118-22. In addition to damages,

plaintiffs sought injunctive relief and a declaratory judgment regarding the constitutionality of

certain local laws regulating pawnbrokers. Id. ¶¶ 125-33, 134-38. Defendants moved to dismiss

the complaint. See Defs.’ Mem. in Supp. of Mot. to Dismiss (Dkt. #12). At oral argument,

Judge Margo K. Brodie dismissed the individual plaintiff as well as all claims against the NYPD.

See Minute Entry dated Mar. 6, 2014. On March 17, 2014, Judge Brodie granted the motion to

dismiss the equal protection, federal malicious prosecution, NYCRL, and tortious interference

claims. See Order dated Mar. 17, 2014 (Dkt. #21).

Plaintiff amended the complaint on May 5, 2014. See Am. Compl. The complaint added

an additional plaintiff, Keith Watts. See ibid. The complaint brought claims against the City and

John Doe officers for deprivation of plaintiffs’ federal Fourth Amendment and equal-protection

rights, municipal liability, and malicious prosecution. Id. ¶¶ 134-200. Plaintiffs again sought

damages, a declaratory judgment, and injunctive relief. Id. ¶¶ 201-18.

Defendants moved to dismiss the equal-protection claim, as well as for reconsideration of

the Court’s prior decision permitting the Fourth Amendment and state malicious-prosecution

claims to proceed. See Defs.’ Mem. in Supp. of Mot. for Reconsideration (Dkt. #39). Judge

Brodie denied the motion. See Order dated Mar. 31, 2015 (Dkt. #54). However, because

plaintiffs’ attorney withdrew Watts’s claims, the Court dismissed all claims as to that plaintiff.

See id. at 2 n.1.

On March 15, 2017, the parties filed cross-motions for summary judgment. See Defs.’

Mot. for Summ. J. (Dkt. #86); Pl.’s Cross-Mot. for Declaratory J. (Dkt. #87).

The Court denied defendant’s motion for summary judgment on plaintiff’s Fourth

Amendment claims. The Court construed plaintiff’s Fourth Amendment claim as consisting of

separate claims for unlawful “seizures and holds of collateral property” and “warrantless

searches and seizures of the premises.” Summ J. Order at 13 n.10. The Court did not consider

the latter claim concerning the premises because defendant did not attack that claim in its

motion. See ibid. With respect to plaintiff’s unlawful-seizure claim, the Court held that both

actual seizures and police holds on collateral are seizures within the meaning of the Fourth

Amendment. Id. at 28. The Court also held plaintiff has a reasonable expectation of privacy in

pledged items and its physical records but not in the information in the records. Id. at 21-22.

Accordingly, the Court concluded that plaintiff could challenge searches and seizures of pledged

items and physical records but not information required to be kept by statute. Id. at 26. The

Court then found that factual disputes existed regarding whether Dambrot’s consents to seizures

and holds were voluntary and whether the plain view doctrine applied to certain collateral items

that were seized and held. Id. at 30-34. And the Court decided that a reasonable juror could

find a “widespread practice of unlawful seizures and holds” such that the City could be held

liable. Id. at 38.

As to the rest of defendant’s motion, the Court granted summary judgment on plaintiff’s

equal-protection claim and denied summary judgment on the malicious-prosecution claim. Id. at

54, 56.

With respect to plaintiff’s motion, the Court held that “the portion of [S]ection 436 that

authorizes [a] warrantless inspection scheme” is unconstitutional. Id. at 49. But the Court

explained that the City “still retains the authority to carry out warrantless inspections of closely

regulated industries in a manner consistent with [New York v. Burger, 482 U.S. 691 (1987)],

whether by existing statutes, ordinances, agency rules, [or] regulations.” Id. at 50. The Court

also found that “Local Law 149[] . . . [does] not violate the Fourth Amendment.” Ibid.

On June 25, 2018, defendant requested a pre-motion conference in anticipation of a

motion for summary judgment on plaintiff’s Fourth Amendment claim regarding premises

seizures. See Mot. for Pre-Mot. Conf. (Dkt. #96). The Court denied defendant’s request. See

Order dated June 27, 2018 (Dkt. #97). The Court clarified that plaintiff’s claim was that “the

various inspections schemes” were “applied or administered . . . in an unconstitutional manner.”

Id. at 3. Because “the parties appear to agree that [certain documents describing the regulatory

scheme] are at the outer bounds of what is constitutional,” the Court explained that “[s]earches

and seizures that go beyond those . . . bounds, without another legal justification, are . . .

unconstitutional.” Ibid. Accordingly, the Court stated that “[t]o the extent the NYPD exceeded

the bounds of its various inspection schemes, the trier of fact will have to consider the

circumstances to determine whether the officers had an objectively lawful basis for their

actions.” Id. at 4. The Court further noted that the jury would not need to consider the

“subjective intent or motivations” of officers to conduct those inquiries. Ibid. Since “the

remaining issues in [the] case . . . are factual in nature,” the Court saw no basis for a second

summary judgment motion. Id. at 5.

This case was reassigned to me on February 6, 2020. The parties filed an amended

proposed joint pretrial order on October 7, 2020. See First Am. Proposed Joint Pretrial Order

(Dkt. #126). I scheduled a jury trial to commence on April 11, 2022. See Order dated Oct. 21,

2021.

The parties filed motions in limine. See Pl.’s Mem. in Supp. of Mot. in Limine (Dkt.

#139-1) (“Pl.’s Mem.”); Def.’s Mem. in Supp. of Mot. in Limine (Dkt. #142-15) (“Def.’s

Mem.”). After the parties docketed their motions, they filed a second amended proposed joint

pretrial order. See Second Am. Proposed Joint Pretrial Order (Dkt. #148).1

1 To the extent that the second amended proposed joint pretrial order suggests additional or different grounds for

certain motions in limine than those actually raised in the parties’ moving papers, I do not consider those new

arguments in this Order.

Plaintiff moves to (i) preclude the testimony of twenty-seven NYPD officers and (ii)

permit the use of an affidavit prepared by Dambrot before his death. See Pl.’s Mem. at 7-10.

Defendant moves to (i) preclude plaintiff’s expert testimony on lost profits damages, (ii)

preclude plaintiff from introducing a log of contacts with NYPD officers prepared by Dambrot

(“NYPD Contact Log”), see Decl. of Thomas John Rizzuti Ex. F (Dkt. #142-7) (“NYPD Contact

Log”) (iii) preclude testimony from plaintiff’s witnesses who were not disclosed during

discovery, (iv) preclude plaintiff from designating certain depositions in its case-in-chief, and (v)

preclude plaintiff from offering evidence at trial concerning issues already decided by the Court.

See Def.’s Mem. at 3-20.

DISCUSSION

As explained below, I reserve ruling on plaintiff’s motion to preclude NYPD officer

testimony and deny plaintiff’s motion to admit the Dambrot Affidavit. I grant defendant’s

motion to preclude the NYPD Contact Log, grant in part defendant’s motion to preclude

evidence concerning issues controlled by the law of the case, and deny defendant’s motions to

preclude expert testimony on lost profits damages, to preclude undisclosed witnesses, and to

preclude the admission of certain deposition testimony.

I. Plaintiff’s Motions

Plaintiff moves to preclude testimony from twenty-seven NYPD officers and to admit the

Dambrot Affidavit. For the reasons stated below, I reserve ruling on plaintiff’s motion with

respect to NYPD officer testimony and deny plaintiff’s motion to admit the affidavit.

A. Motion to Preclude NYPD Officer Testimony

Plaintiff moves to preclude the testimony of twenty-seven NYPD officers as cumulative,

confusing, and prejudicial under Federal Rule of Evidence 403. See Pl.’s Mem. at 4, 7-8. I

decline to rule on this motion prior to trial.

Plaintiff asserts that the additional twenty-seven officers “would fail to offer any

additional probative value to the other twenty . . . officers” that the parties plan to call. Pl.’s

Mem. at 4. Plaintiff also suggests that the proposed testimony would “unfairly delay the trial”

and that preclusion would serve “the interests of justice.” Id. at 8.

Defendant responds that “[t]he [twenty-seven] officers . . . were identified by plaintiff as

visiting [plaintiff’s] stores and interacting with their managers in” the NYPD Contact Log.

Def.’s Opp’n at 3 (Dkt. #143). Defendant notes that those officers were not involved in putting

holds on or seizing collateral, and defendant suggests that their testimony is relevant to plaintiff’s

Fourth Amendment claim regarding searches and seizures of Gem’s premises. See id. at 3, 3 n.3;

Decl. of Thomas John Rizzuti Ex. B at 15 n.9 (Dkt. #143-3). Defendant also points out that

plaintiff “intends to offer evidence of the interactions between the officers and [plaintiff’s]

employees through the [NYPD Contact Log].” Def.’s Opp’n at 3.

The purpose of motions in limine is “to aid the trial process by enabling the Court to rule

in advance of trial on the relevance of certain forecasted evidence, as to issues that are definitely

set for trial, without lengthy argument at, or interruption of, the trial.” Palmieri v. Defaria, 88

F.3d 136, 141 (2d Cir. 1996) (citation omitted). Courts considering a motion in limine “may

reserve decision until trial, so that the motion is placed in the appropriate factual context.” Ali v.

Connick, No. 11-CV-5297 (NGG) (VMS), 2016 WL 3002403, at *2 (E.D.N.Y. May 23, 2016)

(citation omitted).

Here, plaintiff argues that the additional officer testimony is inadmissible under Rule 403,

which permits a court to “exclude relevant evidence if its probative value is substantially

outweighed by a danger of one or more of the following: unfair prejudice, confusing the issues,

misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence.”

Fed. R. Evid. 403.

As I explain below, the NYPD Contact Log is not admissible. And defendant appears to

concede that in the absence of the log, defendant would “have no cause to call [the NYPD]

witnesses.” Def.’s Mem. at 2 n.2. But to the extent that plaintiff intends put on other evidence

of interactions between the twenty-seven officers and Gem employees, the probative value of the

officer testimony does not seem likely to be outweighed by any of the dangers listed in Rule 403.

However, plaintiff may not reference interactions involving all twenty-seven officers at trial and

defendant may not call all its listed witnesses. Given uncertainty about how the parties will

present their cases to the jury, I reserve ruling on plaintiff’s motion to preclude the twenty-seven

additional NYPD officers. See, e.g., Connick, 2016 WL 3002403, at *2.

B. Motion to Admit the Dambrot Affidavit

Plaintiff moves to permit the use of a sworn affidavit prepared by Dambrot before his

death (“Dambrot Affidavit”). Pl.’s Mem. at 5; see Decl. of Paul J. Solda Ex. A (Dkt. #87-4)

(“Dambrot Aff.”). Plaintiff argues that the affidavit is not inadmissible hearsay because it is

former testimony given by an unavailable witness and because it falls within the residual

exception to the rule against hearsay. Pl.’s Mem. at 8-10; see Fed. R. Evid. 804(b)(1), 807.

Neither of those arguments is convincing, and so I deny plaintiff’s motion to permit use of the

Dambrot Affidavit.

1. Exception for Former Testimony

The Dambrot Affidavit does not fall within hearsay exception for former testimony given

by an unavailable witness. Rule 804(b)(1) provides that where “the declarant is unavailable as a

witness,” “[t]estimony that . . . was given as a witness at a trial, hearing, or lawful deposition . . .

and . . . is now offered against a party who had . . . an opportunity . . . to develop [that testimony]

by direct, cross-, or redirect examination” is “not excluded by the rule against hearsay.” Fed. R.

Evid. 804(b)(1). Although Dambrot is deceased and therefore unavailable, see id. 804(a)(4), his

affidavit was not testimony given “at a trial, hearing, or lawful deposition,” see id. 804(b)(1)(A);

Sommerfield v. City of Chicago, No. 08-CV-3025, 2014 WL 12802520, at *1 (N.D. Ill. July 8,

2014) (Rule 804(b)(1) does not apply to affidavits); Tate v. Zaleski, No. 19-CV-63 (TBM)

(MTP), 2021 WL 5811965, at *4 (S.D. Miss. Dec. 7, 2021) (same). Plaintiff has cited no

authority to the contrary. See Pl.’s Mem. Therefore, the hearsay exception for former testimony

does not apply to the Dambrot Affidavit.

2. Residual Exception

Even when the hearsay exceptions in Rules 803 and 804 do not apply, the residual

exception in Rule 807 provides that a hearsay statement is admissible when “(1) the statement is

supported by sufficient guarantees of trustworthiness” and “(2) it is more probative on the point

for which it is offered than any other evidence that the proponent can obtain through reasonable

efforts.” Fed. R. Evid. 807(a). In this circuit, hearsay may be admitted under the residual

exception if “(i) it is particularly trustworthy; (ii) it bears on a material fact; (iii) it is the most

probative evidence addressing that fact; (iv) its admission is consistent with the rules of evidence

and advances the interests of justice; and (v) its proffer follows adequate notice to the adverse

party.” United States v. Dawkins, 999 F.3d 767, 791 (2d Cir. 2021) (quoting United States v.

Bryce, 208 F.3d 346, 350-51 (2d Cir. 1999)); accord Adamson v. Miller, 808 F. App’x 14, 17 n.2

(2d Cir. 2020) (summary order). For the residual exception to apply, all of those requirements

must be satisfied. United States v. Hill, 658 F. App’x 600, 603 (2d Cir. 2016) (summary order).

Here, the residual exception does not apply because the Dambrot Affidavit is not

“particularly trustworthy.” Dawkins, 999 F.3d at 791 (quoting Bryce, 208 F.3d at 350). In

determining a statement’s trustworthiness, Rule 807 instructs courts to consider “the totality of

circumstances under which [the statement] was made and evidence, if any, corroborating the

statement.” Fed. R. Evid. 807(a)(1); see Gist v. United States, No. 19-CV-5095 (GHW), 16-CR-

656-6 (GHW), 2021 WL 3774289, at *14 (S.D.N.Y. Aug. 24, 2021) (describing 2019

amendments to Rule 807 that focus courts on circumstantial guarantees of trustworthiness and

independent corroborating evidence).

The Dambrot Affidavit is not supported by circumstantial guarantees of trustworthiness.

The Dambrot Affidavit was originally submitted as one of plaintiff’s exhibits during summary

judgment practice. See Pl.’s Cross-Mot. for Declaratory J. (Dkt. #87). In the first paragraph of

the affidavit, Dambrot explains that he “submit[ted] [the] affidavit in opposition to [defendant’s]

motion seeking summary judgment and in support of Gem’s [cross-motion].” Dambrot Aff. ¶ 1.

He also says that he could “adequately respond through [the] affidavit” in part because he had

“read the [defendant’s] papers.” Ibid. The affidavit notes that Dambrot had already been

“examined in a deposition” for “three days” at the time he created his affidavit. Id. ¶ 7. Indeed,

the affidavit seeks to correct what Dambrot refers to as “mischaracterizations of [his] deposition

testimony or . . . snippets taken out of context” in defendant’s summary judgment papers. Ibid.

Much of the affidavit concerns Dambrot’s creation of the NYPD Contact Log and Dambrot’s

refusal to consent to searches or seizures of collateral, and the affidavit provides detail about

several seizures contested at summary judgment. Id. ¶¶ 3-4, 6, 8-10. But the affidavit is not

styled as a factual narrative. Instead, the affidavit largely consists of argumentative responses to

points made in defendant’s summary judgment papers. See, e.g., id. ¶¶ 2-3, 5, 7-10.

Taken as a whole, the affidavit appears to have been created to bolster plaintiff’s case

following Dambrot’s deposition and in part to rebut defendant’s use of Dambrot’s deposition

testimony on summary judgment. As such, the Dambrot Affidavit was created for the purpose of

advancing plaintiff’s interests during this litigation, and the affidavit therefore suffers from a

serious risk that Dambrot was insincere. See Schering Corp. v. Pfizer Inc., 189 F.3d 218, 232-33

(2d Cir. 1999) (describing classic risk that hearsay will be unreliable because insincere). Even

“[t]the most truthful of” affidavits prepared in response to summary judgment motions “cannot

escape the reality that they are prepared with the incentive to set forth the facts in a light most

favorable to itself.” Broga v. Northeast Utils., 315 F. Supp. 2d 212, 218 (D. Conn. 2004)

(internal quotation marks and citation omitted).

Plaintiff argues that Dambrot had no ownership interest in Gem or financial interest in

this litigation. See Pl.’s Reply at 3 (Dkt. #141). Regardless, Dambrot’s affidavit often uses the

third-person “we,” indicating a close affiliation between Dambrot and Gem. See, e.g., Dambrot

Aff. ¶ 11. And the affidavit is so full of editorializing and legal conclusions, see, e.g., id. ¶ 8

(“Defendant makes hay of several cases which were not specified in our complaint . . . .”); id. ¶ 9

(“I suppose if the NYPD produced a warrant . . . then we would have no case . . . .”); id. ¶ 10

(“The [defendant’s] argument seems to suggest that my NYPD Log is required to be maintained

pursuant to some rule of law and therefore must be content specific without ambiguity.”); id. ¶

11 (“I am amused how [defendant] use[s] the word ‘request a hold’ – but fail to mention that

their threats always drove to force us to consent.”), that the reliability of the entire affidavit is

questionable.

Plaintiff points to no meaningful indicia of reliability. Plaintiff argues that the affidavit

was made under oath and that Dambrot “would be subject to penalties of perjury for lying.” Pl.’s

Reply at 2. But just because a statement is made under oath does not mean that it is trustworthy.

See O’Brien v. City of Yonkers, No. 07-CV-3974 (KMK) (LMS), 2013 WL 1234966, at *8 n.8

(S.D.N.Y. Mar. 22, 2013). The context in which the oath was taken and the extent to which the

statements under oath were tested by cross-examination are relevant. See ibid. Here, Dambrot

did not take an oath in open court before a jury and during a public proceeding. Cf. In re Sept.

11 Litig., 621 F. Supp. 2d 131, 163 (S.D.N.Y.2009) (admitting testimony of witnesses under

residual exception, noting that they had “testified in court, before a jury, under oath and penalty

of perjury, in a highly-scrutinized, public proceeding”). Nor was Dambrot subject to cross-

examination on the contents of the affidavit after he prepared it. See O’Brien, 2013 WL

1234966, at *8 n.8 (finding testimony under oath insufficiently reliable in part because there had

been no cross-examination on certain issues). Defendant never even had the chance to depose

Dambrot on the specific assertions made in the affidavit because, as I explained, Dambrot

prepared the affidavit in part to backtrack from his deposition testimony. Given the affidavit’s

contents, purpose, and timing, an oath and the penalty of perjury alone are not enough to

guarantee trustworthiness.

Plaintiff also argues that the affidavit should be admitted because Dambrot knew that he

would be subject to cross-examination about his affidavit in this litigation. See Pl.’s Reply at 3.

In support, plaintiff cites a Third Circuit case finding that a district court did not abuse its

discretion in admitting an affidavit from a deceased affiant under Rule 807. Bohler-Uddeholm

Am., Inc. v. Ellwood Grp., Inc., 247 F.3d 79, 113 (3d Cir. 2001). The district court had relied in

part on the declarant’s knowledge about the pending litigation and the possibility that he would

be cross-examined in admitting the exhibit. See ibid. Yet the affidavit in Bohler-Uddeholm bore

greater indicia of trustworthiness than the affidavit here. That affidavit does not appear to have

been created as a response to an opposing party’s summary judgment papers and did not try to

counter the opposing party’s use of the affiant’s prior deposition testimony. Rather, it does not

appear from the Third Circuit’s opinion that the affiant had been deposed about the relevant

facts, and the district court decided that the affidavit provided “the only way” that a particular

claim could be rebutted. See ibid.

Decisions in which courts in this circuit have admitted affidavits from deceased persons

have similarly involved indicia of trustworthiness that are absent here. See Lopez v. Miller, 915

F. Supp. 2d 373, 423-26 (E.D.N.Y. 2013); Disabled in Action v. City of New York, 437 F. Supp.

3d 298, 308 n.11 (S.D.N.Y. 2020); Common Cause/New York v. Brehm, 432 F. Supp. 3d 285,

288 n.1 (S.D.N.Y. 2020). They involved multiple affidavits that were “detailed, internally

consistent, and substantially consistent with each other,” Lopez, 915 F. Supp. 2d at 425,

declarations from deceased declarants that “[were] as trustworthy as . . . other declarations . . .

that [the opposing party] [did] not challenge,” Disabled in Action, 437 F. Supp. 3d at 308 n.11,

or a scenario where the opposing party had “expressly declined to depose” the declarant, Brehm,

432 F. Supp. 3d at 288 n.1. As I explained, the Dambrot Affidavit consists in large part of

arguments against positions taken in defendant’s summary judgment papers, and one of its

purposes is to rehabilitate Dambrot’s deposition. Indeed, plaintiff argues that the affidavit is

necessary because “the deposition testimony of Dambrot lacks clarity in many regards and

requires support from his affidavit, in order to align (what [would have] been) his testimony and

the evidence.” Pl.’s Mem. at 5 n.8. Dambrot’s awareness that he would be subject to cross-

examination on the affidavit suggests that he would have fallen back on the affidavit if

impeached through his deposition testimony. Under those circumstances, I find inapposite the

decisions that have admitted affidavits made by deceased affiants who anticipated future cross-

examination.

The other cases upon which plaintiff relies are also inapposite. See Pl.’s Mem. at 10.

Two of those cases did not decide that similar affidavits were actually admissible under the

residual exception. In Sellers v. Nationwide Mutual Fire Insurance Co., No. 15-CV-957 (KOB),

2018 WL 1174482, at *3 (N.D. Ala. Mar. 6, 2018), the district court denied a motion to strike an

affidavit from a deceased affiant on summary judgment, noting that a district court “may

consider out-of-court statements within affidavits . . . so long as they may be reduced to evidence

in an admissible form at trial.” Similarly, in Landreaux v. Huntington Ingalls Inc., No. 20-1208,

2021 WL 533717, at *2 (E.D. La. Feb. 12, 2021), the district court denied a motion to strike

affidavits submitted on a motion to remand in part because the Rule 804 exceptions for

unavailable declarants could apply.

Moreover, plaintiff has not identified any specific correlations between the Dambrot

Affidavit and other evidence that provide independent corroboration for the affidavit’s contents.

Plaintiff’s memorandum asserts that the affidavit “can be corroborated by other evidence.” Pl.’s

Mem. at 6. But beyond arguing that the affidavit’s contents are corroborated by “the attendant

Gem contract/pledge records and computer reports,” generally, citing to thirty-seven of Gem’s

trial exhibits, Pl.’s Reply at 3, and referencing “statements from Dambrot’s depositions and . . .

testimony by . . . eight Gem employees,” id. at 2 n.5, plaintiff does not actually point to such

evidence. Those conclusory statements accompanied by citations to vast portions of the record

do not establish that corroborating evidence exists for specific factual assertions made in the

affidavit.

Even if the Dambrot Affidavit were partially corroborated by other evidence, as I have

explained, the affidavit is not sufficiently trustworthy to be admitted under Rule 807. The

residual hearsay exception applies “very rarely, and only in exceptional circumstances.” Parsons

v. Honeywell, Inc., 929 F.2d 901, 907 (2d Cir. 1991) (citation omitted); Schering Corp., 189 F.3d

at 232 (same). Sometimes, an affidavit from a deceased witness may be admissible under this

exception. Cf. Lopez, 915 F. Supp. 2d at 423-26; Disabled in Action, 437 F. Supp. 3d at 308

n.11; Brehm, 432 F. Supp. 3d at 288 n.1. But here, the Dambrot Affidavit appears to be a

litigation document manufactured to argue against an opposing party’s dispositive motion and to

shore up potential weaknesses in extensive deposition testimony. Accordingly, plaintiff’s

motion to use the Dambrot Affidavit pursuant to the residual exception is denied.

II. Defendant’s Motions

For the reasons stated below, defendant’s motion to preclude the NYPD Contact Log is

granted, and defendant’s motion to preclude certain evidence under the law-of-the-case doctrine

is granted in part. Defendant’s motions to preclude expert testimony on lost profits damages, to

preclude undisclosed witnesses, and to preclude designation of deposition testimony are denied.

A. Motion to Preclude Expert Testimony on Lost Profits

Defendant moves to preclude expert testimony from plaintiff’s witnesses Barry Koch and

Alan Schachter on lost profits damages under Daubert v. Merrell Dow Pharmaceuticals, Inc.,

509 U.S. 579 (1993). See Def.’s Mem. at 11-20. Since plaintiff no longer intends to call Koch

as an expert witness, I address defendant’s arguments only as they relate to Schachter. See Pl.’s

Opp’n at 18 n.28. Defendant argues that Schachter’s report is “premised upon [an] unsupported

assumption of a connection between police presence and customer behavior” and contains

analysis that “[does] not comport with . . . professional standards” set by the American Institute

of Certified Public Accountants (“AICPA”). Def.’s Mem. at 15. Both arguments go to the

weight of Schachter’s testimony, not its admissibility, and so defendant’s motion is denied.

Federal Rule of Evidence 702 provides that “[a] witness who is qualified as an expert by

knowledge, skill, experience, training, or education may testify in the form of an opinion or

otherwise” if four conditions are met: “(a) the expert’s scientific, technical, or other specialized

knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;

(b) the testimony is based on sufficient facts or data; (c) the testimony is the product of reliable

principles and methods; and (d) the expert has reliably applied the principles and methods to the

facts of the case.” Fed. R. Evid. 702. A party seeking to admit expert testimony under Rule 702

“must establish admissibility by a preponderance of the evidence.” Kortright Capital Partners

LP v. Investcorp Inv. Advisers Ltd., 392 F. Supp. 3d 382, 397 (S.D.N.Y. 2019) (citing Bourjaily

v. United States, 483 U.S. 171, 175-76 (1987)). The Rule 702 standard for the admissibility of

expert testimony is “liberal.” Nimely v. City of New York, 414 F.3d 381, 395 (2d Cir. 2005).

Under Rule 702, the court must ensure that the “expert’s testimony both rests on a

reliable foundation and is relevant to the task at hand.” Daubert, 509 U.S. at 597; accord United

States v. Willis, 14 F.4th 170, 185 (2d Cir. 2021). That “gatekeeping role” requires the court to

“consider the indicia of reliability identified in Rule 702, namely, (1) that the testimony is

grounded on sufficient facts or data; (2) that the testimony is the product of reliable principles

and methods; and (3) that the witness has applied the principles and methods reliably to the facts

of the case.” Amorgianos v. Nat’l R.R. Passenger Corp., 303 F.3d 256, 265 (2d Cir. 2002)

(internal quotation marks and citation omitted) (quoting Fed. R. Evid. 702); see Kumho Tire Co.,

Ltd. v. Carmichael, 526 U.S. 137, 141 (1999) (holding that courts have the same “gatekeeping”

role with respect to “technical” and “other specialized” knowledge). Factors that bear on

reliability include whether a theory or technique “can be (and has been) tested,” “whether the

theory or technique has been subjected to peer review and publication,” the technique’s “known

or potential rate of error” and the existence of standards controlling the technique's operation,

and “general acceptance” of the technique or theory in the relevant scientific community.

Amorgianos, 303 F.3d at 266 (quoting Daubert, 509 U.S. at 593-94).

In short, the court must “undertake a rigorous examination of the facts on which the

expert relies, the method by which the expert draws an opinion from those facts, and how the

expert applies the facts and methods to the case at hand.” Id. at 267. The court’s analysis “must

focus on the principles and methodology employed by the expert, without regard to the

conclusions the expert has reached or the district court’s belief as to the correctness of those

conclusions.” Id. at 266. However, “only serious flaws in reasoning or methodology will

warrant exclusion.” In re Fosamax Prods. Liab. Litig., 645 F. Supp. 2d 164, 173 (S.D.N.Y.

2009) (citing Amorgianos, 303 F.3d at 267). For example, expert testimony should be excluded

as unreliable if the testimony “is speculative or conjectural or based on assumptions that are so

unrealistic and contradictory as to suggest bad faith or [is] in essence an apples and oranges

comparison.” Zerega Ave. Realty Corp. v. Hornbeck Offshore Transp., LLC, 571 F.3d 206, 214

(2d Cir. 2009) (internal quotation marks and citation omitted). Other deficiencies in the expert’s

assumptions go to the testimony’s “weight, not . . . admissibility.” Ibid. (citation omitted).

Plaintiff retained Schachter, who is a licensed accountant and an accredited Certified

Valuation Analyst, to calculate the lost profits damages suffered by plaintiff due to defendant’s

allegedly wrongful conduct. Decl. of Thomas John Rizzuti Ex. I at 2-3 (Dkt. #142-10)

(“Schachter Report”). In calculating plaintiff’s damages, Schachter assumed defendant’s

liability, that plaintiff suffered damages from 2011 through 2014, that defendant’s actions

affected all plaintiff’s stores in New York City, and that the dispute between the parties

generated bad press for plaintiff. See id. at 4, 10-11. To calculate the damages, Schachter

gathered financial information from plaintiff and data for the pawn industry, determined

“industry-wide and company specific variable costs,” and “[c]reated an economic damage

model . . . to determine the extent to which . . . [d]efendant’s actions resulted in lost profits.” See

id. at 11-12. Schachter’s model was based on “the Yardstick Method,” “which compares the

actual performance of [a company] to industry metrics to estimate the profits the [c]ompany

would have earned ‘but for’ [defendant’s] alleged wrongful acts.” Id. at 12.

More specifically, Schacter “compute[d] ‘lost revenue’ by comparing [plaintiff’s] ‘actual

revenue’ to its ‘expected revenue’ in each year of the [period in which plaintiff allegedly

suffered damages]. [Schacter] then deduct[ed] ‘variable costs’ from the lost revenue to compute

‘lost profits.’” Id. at 13. Plaintiff’s expected revenue was determined by calculating a projected

growth rate specific to plaintiff but based on industry growth rates. See id. at 14. Schachter then

applied that growth rate to plaintiff’s actual revenue earned in a particular year. See ibid.

Plaintiff’s growth rate was adjusted for inflation and drops in gold prices. See ibid.

Defendant argues that Schachter’s expert testimony is inadmissible because Schachter

improperly assumed in his calculations that plaintiff “suffered lost profits as a result of alleged

excessive police presence” and failed to “address all relevant factors” needed to perform a

“Yardstick Method” analysis. Def.’s Mem. at 15; Def.’s Reply at 9 (Dkt. #142-29). But those

alleged deficiencies do not render Schachter’s testimony so unreliable that it must be excluded.

Schachter may testify regarding the calculations that he made using the Yardstick

Method. Specifically, Schachter may testify regarding the amount of profits plaintiff lost due to

some plaintiff-specific cause between 2011 and 2014 based on a comparison of plaintiff’s actual

revenues with expected revenues pegged to industry-based growth rate. See Schachter Report at

12-16. Doing so is not prohibited on the ground that Schachter operated from the assumption

that “‘but-for’ . . . [d]efendant’s actions, . . . [p]laintiff would have experienced . . . higher . . .

profits,” rather than drawing independent conclusions about the causal chain leading to those lost

profits. Id. at 12. Instead, Schacter took as a given a theory of causation communicated to him

by plaintiffs. See Decl. of Thomas John Rizzuti Ex. M. at 54-59 (Dkt. #142-14) (“Schachter

Dep.”) (discussing plaintiff’s instructions regarding causation). Indeed, preclusion under these

circumstances would prevent plaintiff from calling any expert on lost profits damages who could

not also serve as an expert on causation issues. But the jury can assess the reliability of

Schacter’s assumptions regarding causation, and defendant “may inquire into those theories on

cross-examination.” Playtex Prods., Inc. v. Procter & Gamble Co., No. 02-CV-8046 (WHP),

2003 WL 21242769, at *5 (S.D.N.Y. May 28, 2003). Ultimately, plaintiff will need to establish

its theory of causation at trial, and “[i]f . . . plaintiff . . . fails to prove causation[,] . . . its expert

testimony [on damages] will suffer the same fate.” Sleepy’s, LLC v. Select Comfort Wholesale

Corp., No. 07-CV-4018 (TCP) (ARL), 2012 WL 441190, at *2 (E.D.N.Y. Feb. 10, 2012).

That said, Schachter may not go beyond testifying that some cause specific to plaintiff’s

business caused the lost profits Schachter identified. For example, he may not testify that

defendant’s conduct caused the lost profits. Such testimony would be improper because, as

noted above, Schachter assumed that defendant’s conduct caused plaintiff damages. See

Schachter Report at 10-11 (stating that Schachter was “asked to assume that all of the New York

City stores of Gem Financial were affected by the aforementioned wrongful acts, and the

negative publicity generated by the dispute between the parties”); Schachter Dep. at 54-59.

Moreover, Schachter’s projections using industrywide data do not address whether defendant’s

conduct—as opposed to some alternative cause specific to plaintiff’s business—led to plaintiff’s

underperformance over the relevant period. Cf. Def.’s Mem. at 19 (proffering plaintiff’s

decision to sell collateral at below cost as alternative explanation). Schachter adjusted his model

to take account of one specific feature of plaintiff’s business—plaintiff’s greater-than-usual

reliance on gold items as collateral. See Schachter Report at 14-15. But he did not purport to

conduct an analysis that would exclude other factors specific to plaintiff’s business, such as

plaintiff’s business decisions during the period in question.

Provided that Schachter’s testimony is limited in this way, none of the other purported

deficiencies in Schachter’s use of the Yardstick Method that defendant identifies go to the

admissibility of the testimony, rather than its weight. Defendant criticizes the appropriateness of

the “Yardstick Method” in this case and Schachter’s assumptions that “police presence affected

customer behavior[,] . . . . that [plaintiff] incurred damages during the period of 2011 to 2014[,] .

. . . [that] all of plaintiff’s stores were affected[,] . . . and the . . . negative press generated by the

dispute.” Def.’s Mem. at 17, 18-19. Defendant points to other evidence that Schachter’s

assumptions about causation were incorrect, including “the lack of correlation between the

number of pawn . . . and sales tickets and [plaintiff’s] decrease in revenue” and “the historic

decline of the value of gold in 2013 and 2014.” Id. at 19. In addition, defendant argues that

Schachter failed to address plaintiff’s growth in 2011 and 2012, “the delay of the impact of the . .

. NYPD presence until 2013,” why plaintiff’s decline in revenue in 2013 was largely limited to

one store, plaintiff’s sales practices in 2013 and 2014, and the effect of competition on plaintiff’s

revenue. Id. at 19-20.

But while defendant may properly challenge the assumptions underlying Schachter’s

analysis, and posit alternative causes for the decline in plaintiff’s revenue, the issues that

defendant identifies are “gaps or inconsistencies in [Schachter’s] reasoning” that “go to the

weight of the evidence.” Restivo v. Hessemann, 846 F.3d 547, 577 (2d Cir. 2017) (citation

omitted). Those alleged missteps in Schachter’s report, as well as his justifications for selecting

the Yardstick Method as a framework for his analysis, are “the proper subject of cross-

examination or competing expert testimony,” BPP Wealth, Inc. v. Weiser Cap. Mgmt., LLC, 623

F. App’x 7, 10 (2d Cir. 2015) (summary order), and do not warrant preclusion. Accordingly,

defendant’s motion is denied.

B. Motion to Preclude Plaintiff’s NYPD Contact Log

Defendant moves to preclude plaintiff from introducing the NYPD Contact Log2 on the

ground that the document is inadmissible hearsay. See Def.’s Mem. at 6-9. The NYPD Contact

Log appears to consist of dated entries beginning on March 10, 2006, and ending on November

5, 2013, detailing instances when NYPD officers interacted with plaintiff’s employees. See

NYPD Contact Log. Plaintiff argues that the NYPD Contact Log is admissible under the

business records exception and the residual exception to the hearsay rule. Because neither

exception applies and there does not appear to be any other basis to admit the document,

defendant’s motion is granted.

1. Business Records Exception

Plaintiff is incorrect that the NYPD Contact Log is admissible as a business record. See

Pl.’s Opp’n at 13. Under Rule 803(6), a business record is not excluded by the rule against

hearsay if “the record was made at or near the time by—or from information transmitted by—

someone with knowledge,” “the record was kept in the course of a regularly conducted activity

of a business, organization, occupation, or calling, whether or not for profit,” “making the record

was a regular practice of that activity,” “all these conditions are shown by the testimony of the

custodian or another qualified witness, or by a certification that complies with Rule 902(11) or

(12) or with a statute permitting certification,” and “the opponent does not show that the source

2 Although plaintiff designated the NYPD Contact Log as Exhibit 14, defendant’s opening brief misidentifies the

document as plaintiff’s Exhibit 45. See, e.g., Second Am. Proposed Joint Pretrial Order at 24 n.14. To the extent that

defendant may have consented to the NYPD Contact Log in error, see Pl.’s Opp’n at 10-11, plaintiff offers no

persuasive reason why defendant now should be estopped from moving to preclude the document.

of information or the method or circumstances of preparation indicate a lack of trustworthiness.”

Fed. R. Evid. 803(6)(A)-(E).

“The purpose of the [business records exception] is to ensure that documents were not

created for ‘personal purpose[s] . . . or in anticipation of any litigation’ so that the creator of the

document ‘had no motive to falsify the record in question.’” United States v. Kaiser, 609 F.3d

556, 574 (2d Cir. 2010) (quoting United States v. Freidin, 849 F.2d 716, 719 (2d Cir. 1988)).

“[R]ecords created in anticipation of litigation do not fall within” the exception. United States v.

Feliz, 467 F.3d 227, 234 (2d Cir. 2006). Rule 803(6) otherwise “favors the admission of

evidence rather than its exclusion if it has any probative value at all.” Kaiser, 609 F.3d at 574

(quoting United States v. Williams, 205 F.3d 23, 34 (2d Cir. 2000)). Accordingly, the “principal

precondition to admissibility is that the record has sufficient indicia of trustworthiness to be

considered reliable.” Phoenix Assocs. III v. Stone, 60 F.3d 95, 101 (2d Cir. 1995) (internal

quotation marks, alterations, and citation omitted). “The determination of whether, in all the

circumstances, the records are sufficiently reliable to warrant their admission . . . is left to the

sound discretion of the trial court.” Potamkin Cadillac Corp. v. B.R.I. Coverage Corp., 38 F.3d

627, 633 (2d Cir. 1994).

The NYPD Contact Log appears to be a document prepared in anticipation of litigation,

not a business record admissible under Rule 803(6). See Feliz, 467 F.3d at 234. But even

assuming that the NYPD Contact Log qualifies as a business record, the record lacks “sufficient

indicia of trustworthiness” to be admissible because Dambrot edited the final document after

plaintiff filed this action, Dambrot could not explain his method for creating the document, and

Dambrot admitted that certain entries may be inaccurate. Stone, 60 F.3d at 101; see Fed. R.

Evid. 803(6)(E).

The NYPD Contact Log appears to have been created in anticipation of the litigation.

Dambrot testified in his deposition that he made the document that plaintiff seeks to offer as

evidence “[a]fter the lawsuit started.” Decl. of Thomas John Rizzuti Ex. E at 51:10-12 (Dkt.

#142-6) (“Dambrot Dep.”). Dambrot explained that he “had notes here, notes there. [He] put

[them] together so they made sense. [He] copied the dates off the notes off the computer screen. .

. . This . . . document [the NYPD Contact Log] . . . is an edited document of the originals that

were prepared as they occurred.” Id. at 51:10-12, 16-17. In light of Dambrot’s testimony, the

NYPD Contact Log appears to have been made to “serve the purposes of this litigation,” Trouble

v. Wet Seal, Inc., 179 F. Supp. 2d 291, 299 (S.D.N.Y. 2001), and not in “the course of a regularly

conducted activity of a business,” Fed. R. Evid. 803(6)(B).

Plaintiff’s reliance on Dambrot’s Affidavit to show that “[k]eeping a log of . . . police

intrusions became a regular practice for [plaintiff]” is misplaced. Pl.’s Opp’n at 12. Dambrot

stated in his affidavit that he kept a “running document in [his] computer” and “[i]n November[]

2013 . . . closed it, made a PDF document[,] and sent it to [his] attorney.” See Pl.’s Opp’n at 12

(quoting Dambrot Aff.). But because the Dambrot Affidavit is inadmissible, see pp. 8-15, supra,

Dambrot’s deposition appears to be the only source of testimony to establish a foundation for the

NYPD Contact Log as required by Rule 803(6). And Dambrot’s deposition testimony indicates

that Dambrot did far more than “close[] . . . a PDF document.” Pl.’s Opp’n at 12 (quoting

Dambrot Aff.). Dambrot testified that he compiled and edited materials to create the NYPD

Contact Log. See Dambrot Dep. at 51:10-12, 16-17. Accordingly, the NYPD Contact Log is not

a business record covered by Rule 803(6).

Even if the NYPD Contact Log is a business record, it is not sufficiently trustworthy to

be admitted under Rule 803(6). The fact that Dambrot modified entries in the document raises

doubts about the document’s reliability, especially since at least some of those modifications

occurred after plaintiff filed suit. See Dambrot Dep. at 51:10-12, 16-17. Multiple entries in the

document reflect Dambrot’s tinkering. For example, an entry dated September 16, 2012,

referencing a particular pledge includes a final line describing how the item was “[s]old at

auction 04/15/2013.” NYPD Contact Log at 18. Entries dated September 6 and 8, 2012, include

similar annotations. See id. at 17. Moreover, Dambrot testified that “[t]here are no originals” of

the information compiled into the document against which the entries could be checked for

accuracy. Dambrot. Dep. at 51:20. “[M]inor incompleteness of . . . files” may go “to the weight

rather than to the admissibility of . . . evidence,” United States v. Panza, 750 F.2d 1141, 1151 (2d

Cir. 1984), but all the sources for the NYPD Contact Log are missing. Without those materials,

it is impossible to assess the extent to which the information in the log has been manipulated.

Those “circumstances of preparation indicate a lack of trustworthiness.” Fed. R. Evid.

803(6)(E).

Dambrot’s inability to explain how he created the NYPD Contact Log further undermines

the document’s reliability. When Dambrot was asked about the method by which the

information had been inputted into the computer, Dambrot responded, “I don’t know. All I know

is that it is accurate.” Dambrot Dep. at 52:6. But Dambrot’s testimony calls into question the

reliability of certain entries. With respect to an entry dated January 14, 2011, Dambrot testified

that he either received the information “on the phone or [he] picked it up from a report and it was

back-dated to the 14th.” Id. at 50:18-20. Dambrot elaborated that the information “could have

been handed to [him] on the 15th or the 16th but for the most part it is accurate.” Id. at 50:20-21

(emphasis added). That admission does not inspire confidence in the document’s

trustworthiness.

Finally, “[m]any of the log entries are incomplete, disjointed[,] and fail to fully identify

who made or recorded the statements.” Trouble, 179 F. Supp. 2d at 300. Dambrot testified that

the information in the document was “relayed to [him] by store managers” or came from

“conversations with . . . different police officers[,] or it was face-to-face.” Dambrot Dep. at

50:9-11. Later, Dambrot explained that “the vast majority of [the entries] are face-to-face

events.” Id. at 55:3-4. But most of the log entries are sentence fragments that do not identify

which of plaintiff’s employees had an encounter with an NYPD officer. See, e.g., NYPD

Contact Log at 17 (Sept. 7, 2012 entry) (“PO Cabral . . . [e]xamined the Buy Book . . . noted

‘investigation’ on the log sheet. [C]opied pawn ledger.”)

Plaintiff is therefore wrong that that “[t]here is . . . no indication that there may be a lack

of trustworthiness to the document” because it was plaintiff’s “regular practice . . . to maintain

such a record and [the record] was [maintained] by a person having first-hand knowledge or

transmitted by another person with knowledge.” Pl.’s Opp’n at 14. Dambrot’s edits, the

uncertain means by which the document was created, Dambrot’s concession that entries may be

imprecise, and the muddled content of the entries make the NYPD Contact Log untrustworthy.

See Fed. R. Evid. 803(6)(E). Accordingly, the business records exception does not render the

NYPD Contact Log admissible.

2. Residual Exception

For substantially similar reasons, the residual exception to the hearsay rule does not cover

the NYPD Contact Log. Hearsay may only be admitted under the residual exception if “it is

particularly trustworthy.” Dawkins, 999 F.3d at 791 (quoting Bryce, 208 F.3d at 350). As

explained above, Dambrot created the NYPD Contact Log during this litigation, altered entries,

could not recall his method for compiling entries, and suggested that some entries are inaccurate.

Plaintiff has cited no specific corroborating evidence, and the totality of the circumstances

indicate that the document is unreliable. See Fed. R. Evid. 807(a)(1). The NYPD Contact Log is

not admissible under Rule 807, and defendant’s motion is granted.

C. Motion to Preclude Late-Disclosed Witnesses

Defendant moves to preclude plaintiff from offering testimony from Jeffrey Kuhl and

Michael Marino as a sanction for failing to disclose those witnesses during discovery. Def.’s

Mem. at 9-10; see Def.’s Reply at 6 (clarifying that defendant seeks preclusion only as to those

two witnesses). Because plaintiff’s failure to disclose Kuhl and Marino was harmless,

defendant’s motion is denied.

Federal Rule of Civil Procedure 37(c)(1) provides that “[i]f a party fails to . . . identify a

witness as required by Rule 26(a) or (e), the party is not allowed to use that . . . witness to supply

evidence . . . at a trial, unless the failure was substantially justified or is harmless.” Fed. R. Civ.

P. 37(c)(1). Rule 26(a) requires a party to make an initial disclosure “of each individual likely to

have discoverable information . . . that the disclosing party may use to support its claims or

defenses.” Fed. R. Civ. P. 26(a). And Rule 26(e) requires a party to supplement its Rule 26(a)

disclosures “if the party learns that in some material respect the disclosure . . . is incomplete or

incorrect, and if the additional or corrective information has not otherwise been made known to

the other parties during the discovery process or in writing.” Fed. R. Civ. P. 26(e).

Plaintiff failed to disclose Kuhl and Marino as required by Rule 26. At most, the record

reflects that Kuhl and Marino were brought to defendant’s attention through joint pretrial orders

rather than an initial Rule 26(a) disclosure or a supplemental Rules 26(e) disclosure. Courts in

this circuit generally do not view the disclosure of a witness in a joint pretrial order as a proper

Rule 26(e) disclosure. See Merlite Inds., Inc. v. Valassis Inserts, Inc., 12 F.3d 373, 377 (2d Cir.

1993); Wei Yan Yan v. 520 Asian Rest. Corp., No. 13-CV-2417 (KNF), 2014 WL 1877078, at *3

(S.D.N.Y. May 7, 2014); see also Demirovic v. Ortega, No. 15-CV-327 (CLP), 2017 WL

4621089, at *9-10 (E.D.N.Y. Oct. 13, 2017), aff’d, 771 F. App’x 111 (2d Cir. 2019) (summary

order). Therefore, neither Kuhl nor Marino were disclosed initially pursuant to Rule 26(a) or (e).

However, plaintiff has shown that its failure to disclose Kuhl and Marino was harmless.

See Fed. R. Civ. P. 37(c)(1); Ritchie Risk-Linked Strats. Trading (Ir.), Ltd. v. Coventry First

LLC, 280 F.R.D. 147, 159 (S.D.N.Y. 2012) (party that fails to comply with Rule 26 bears the

burden of proving substantial justification and harmlessness). Non-disclosure is harmless “when

there is no prejudice to the party entitled to the disclosure.” Redd v. N.Y. State Div. of Parole,

923 F. Supp. 2d 393, 407 (E.D.N.Y. 2013) (citation omitted). And, more specifically, “a failure

to disclose witness information is ‘harmless’ if the other party was well aware of the identity of

the undisclosed witness[es] and the scope of [their] knowledge well before trial.” Evans v.

United States, 978 F. Supp. 2d 148, 154 (E.D.N.Y. 2013); see Barcroft Media, Ltd. v. Coed

Media Grp., LLC, No. 16-CV-7634 (JMF), 2017 WL 4334138, at *2 (S.D.N.Y. Sept. 28, 2017)

(denying preclusion where plaintiffs knew about undisclosed witness “for months”).

Here, defendant had notice of Kuhl and Marino and the topics of their testimony at least

fifteen months ago when the parties filed a first amended pretrial order including their names.

And defendant’s motion in limine to preclude those witnesses was filed almost sixth months

before the trial date. Given the unusual length of time that this case has been delayed on its way

to trial, plaintiff’s failure to disclose Kuhl and Marino was harmless.

Accordingly, defendant’s motion to preclude undisclosed witness is denied.

D. Motion to Preclude Use of Depositions in Plaintiff’s Case-in-Chief

Defendant moves to preclude plaintiff from using deposition testimony of two NYPD

Chiefs, Phil Pulaski and Joseph Esposito, and Thomas Doephner, an Assistant Deputy

Commissioner in the NYPD Legal Bureau. See Def.’s Mem. at 10-11; Second Am. Proposed

Joint Pretrial Order at 16-17.

No ruling is necessary on defendant’s motion concerning Pulaski and Esposito because

plaintiff has agreed to withdraw its designation of those witnesses’ depositions so long as the

witnesses appear at trial. Pl.’s Opp’n at 4 n.7.

Defendant’s motion to preclude plaintiff from using Doephner’s deposition is denied.

Defendant maintains that the designated portions of Doephner’s deposition “address the

underlying administrative scheme and the NYPD’s use of [LeadsOnline], which the Court

previously found to be . . . lawful.” Def.’s Mem. at 11. But many of the designated parts of

Doephner’s deposition pertain to live issues in this case—such as municipal liability and the

Fourth Amendment claims against the City. For example, Doephner discusses the NYPD’s

general approach to ensuring that officers comply with new rules of law, the NYPD’s

compliance with certain internal guidance, the application of the plain view doctrine to

administrative inspections, and the actions of NYPD officers during administrative inspections.

See Decl. of Paul J. Solda Ex. K at 25:21-26:12, 32:16-33:2, 37:16-40:6, 53:17-54:24 (Dkt. #87-

14). Although it is more difficult to discern how other designated parts of the deposition are

relevant, see, e.g., id. Ex. K at 17:4-18 (Doephner’s understanding of New York State decisional

law), 66:25-68:13 (discriminatory nature of NYPD investigations of recidivists and parolees),

defendant moves to preclude the “entirety of [the] deposition” and does not identify any specific

objectionable testimony, Def.’s Mem. at 11. Defendant’s motion is therefore denied.

E. Motion to Preclude Evidence Concerning Issues Controlled by the Law of the

Case

Defendant’s motion to preclude evidence on issues that were purportedly decided during

motions practice is granted in part. See Def.’s Mem. at 3.

Defendant argues that plaintiff should not be permitted to introduce evidence concerning

(1) “the legality of the administrative scheme, including” (2) “the legality of [LeadsOnline],” (3)

“[the] legitimate law enforcement purpose and use [of LeadsOnline],” (4) “the lack of

constitutional privacy in the records required to be maintained under the administrative scheme,”

(5) “the validity of the summonses unrelated to the lone summons at issue in [plaintiff’s]

surviving state malicious prosecution cause of action,” (6) “wrongdoing on the NYPD’s or

officers’ part by the use of information obtained from inspections in investigating crimes,” and

(7) coercion of plaintiff “through threats in order to acquiesce to various demands[,] . . .

especially demands to use [LeadsOnline].” Id. at 3-5. Defendant suggests that evidence

regarding those issues would be “irrelevant,” “unduly prejudicial,” and confusing to the jury

because the Court already resolved those issues. See id. at 3; Fed. R. Evid. 403.

Under the law-of-the-case doctrine, “a decision on an issue made at one stage of a case

becomes binding precedent to be followed in subsequent stages of the same litigation.” In re

Nassau Cnty. Strip Search Cases, 958 F. Supp. 2d 339, 343 (E.D.N.Y. 2013) (quoting In re PCH

Assocs., 949 F.2d 585, 592 (2d Cir. 1991)). Even so, a district court may exercise its discretion

to “reconsider its own decisions prior to final judgment” given “cogent or compelling reasons”

like “an intervening change of controlling law.” Pescatore v. Pan Am. World Airways, Inc., 97

F.3d 1, 8 (2d Cir. 1996) (internal quotation marks and citations omitted).

Here, plaintiff does not clearly argue that this Court should depart from the earlier

decisions in this case or present “cogent or compelling reasons” for doing so. Ibid. At most,

plaintiff argues that the Court’s analysis of the “required records doctrine” is “somewhat

misplaced” because the Court relied on caselaw relating to the Fifth Amendment. Pl.’s Letter

dated Dec. 23, 2021 at 5 n.6 (Dkt. #154). Yet the Court addressed plaintiff’s concerns in its

order. See Summ. J. Order at 22 n.17. Because plaintiff has not shown that circumstances

justify departure from the Court’s earlier rulings, those prior decisions remain binding under the

law-of-the-case doctrine.

Applying that doctrine, defendant’s motion is granted in part and denied in part.

Defendant’s motion to exclude evidence of criminal summonses other than the one at issue in

plaintiff’s state-law malicious prosecution claim is denied. Contrary to defendant’s arguments,

such evidence is not “irrelevant.” Def.’s Mem. at 3. To be sure, such summonses are not

relevant to plaintiff’s state-law malicious prosecution claim—which is based on a particular

summons issued on September 19, 2012. See Am. Compl. ¶ 189; see Summ. J. Order at 54-55.

But plaintiff seeks to offer evidence of other summonses to show an “illegal municipal policy . . .

to conduct impermissible searches and seizures and levy the force of law upon [plaintiff].” Pl.’s

Opp’n at 10, 10 n.17; see Pl.’s Letter dated Dec. 23, 2021 at 5. And the Court already

recognized in its summary judgment order that a reasonable jury could find a “widespread

policy” supporting municipal liability under Section 1983 in this case based upon evidence “that

a threat of arrest or disruption of business likely preceded every seizure request by an officer.”

Summ. J. Order at 39-40. Evidence of past summonses that officers issued would be relevant to

assessing whether officers coerced consent through threats of criminal process. Moreover,

defendant has not shown this evidence presents a risk of confusion or of misleading the jury that

“substantially outweighs” the probative value of those summonses for plaintiff’s municipal

liability theory. Fed. R. Evid. 403. If defendant wishes, it may seek a limiting instruction to

address those risks. See e.g., Adams v. City of New York, 993 F. Supp. 2d 306, 320 (E.D.N.Y.

2014). Therefore, defendant’s motion to preclude evidence of additional summonses is denied.

Defendant’s motion to preclude evidence relating to coercion and threats is denied,

because it rests on a misunderstanding of the Court’s decisions. Defendant argues that the Court

previously decided that “the use and encouragement of [LeadsOnline] [was] lawful” and “mere

threats without actual injury are not actionable under [Section] 1983.” Def.’s Mem. at 5. But the

Court also decided that “a reasonable jury could find a lack of consent for many of the seizures

and holds at issue” on the basis of “evidence . . . that a threat of arrest or business disruption

preceded every request to seize an item.” Summ. J. Order at 33. Threats that may have vitiated

plaintiff’s consent to seizures thus remain probative as to plaintiff’s Section 1983 claim. Threats

intended to persuade plaintiff to use LeadsOnline are less obviously relevant. But the Court

reserves judgment on evidence of threats relating to LeadsOnline until trial, when the relevance

of that evidence can be assessed with additional evidentiary context.

Defendant’s motion to preclude evidence regarding “the legality of [LeadsOnline]” and

that program’s “legitimate law enforcement purpose and use” is granted with respect to

plaintiff’s proposed evidence about data mining. Def.’s Mem. at 3 Plaintiff indicates that it

intends to put on evidence that “shows that the NYPD . . . data mined the records” in a manner

outside the scope of a “legitimate administrative inspection program.” Pl.’s Letter dated Dec. 23,

2021 at 4; see Pl.’s Opp’n at 5-6. Plaintiff’s data mining evidence seems to rest on a legal theory

already rejected by this Court—plaintiff’s reasonable expectation of privacy in information

uploaded to LeadsOnline. See Summ. J. Order at 22 (concluding that plaintiff had no

“reasonable expectation of privacy in the information in the records” (emphasis in original)).

And plaintiff offers no alternative explanation for the relevance of that evidence. Accordingly,

any minimal probative value of that evidence is substantially outweighed by undue prejudice to

defendant and the danger of misleading the jury. See Fed. R. Evid. 403.

Defendant’s motion to preclude evidence about “wrongdoing on the NYPD’s or officers’

part by the use of information obtained from inspections in investigating crimes” is granted.

Def.’s Mem. at 5. Plaintiff appears to argue that the officers’ use of the information obtained

from their inspections to investigate crimes is evidence that the searches and seizures plaintiff

challenges were “pretextual.” Pl.’s Opp’n at 7. However, as the Court noted in its order

resolving defendant’s motion to dismiss, “an officer’s subjective motive is irrelevant if any

actual search that took place otherwise comports with the Fourth Amendment.” Order dated

Mar. 17, 2014 at 13. Accordingly, plaintiff has not explained why evidence of officers’ motives

for a seizure would be relevant to its Fourth Amendment claim. Nor has plaintiff explained how

officers’ subsequent use of material seized pursuant to a valid administrative scheme would be

evidence that the seizure exceeded the scope of the scheme. At minimum, evidence about

officer motives poses a substantial danger of unfair prejudice or confusion that substantially

outweighs its probative value. See Fed. R. Evid. 403. Accordingly, such evidence is precluded.

Finally, I decline to rule at this time on defendant’s request to preclude certain argument

or evidence that plaintiffs do not appear to be offering. No ruling is needed concerning evidence

or argument on plaintiff’s expectation of “privacy in the records required to be maintained under

[New York’s] administrative scheme,” Def.’s Mem. at 3, because plaintiff indicates that it does

not intend to offer such argument or evidence, see Pl.’s Letter dated Dec. 23, 2021 at 1. Nor will

I rule at this stage on defendant’s motion to preclude evidence about the legality of NYPD’s

administrative scheme governing searches and seizures of collateral loan brokers. Up until the

briefing of motions in limine, “[p]laintiff ha[d] not argued that the Grasso Memo or its later

manifestations as new memoranda or regulations violate the Fourth Amendment in and of

themselves,” but had instead “challenge[d] the manner in which the various . . . regulations[] and

agency memoranda are applied or administered in practice.” Order dated June 27, 2018 at 2-3.

Plaintiff now opines in response to defendant’s preclusion motion that it is “unlikely” that the

NYPD’s administrative scheme was lawful. Pl.’s Letter dated Dec. 23, 2021 at 3. But plaintiff

continues to represent that its theory at trial will be that “the NYPD’s practice grossly

contravened [NYPD’s administrative] guidelines as well as underlying state and federal law.”

Ibid. (emphasis added). Given plaintiff’s articulation of its trial theory, a ruling on defendant’s

motion to preclude evidence or argument regarding a hypothetical challenge to New York’s

administrative scheme does not appear warranted at this time.

CONCLUSION

Plaintiff’s motion to admit the Dambrot Affidavit is denied, and I reserve ruling on

plaintiff’s motion to preclude NYPD officer testimony. Defendant’s motion to preclude the

NYPD Contact Log is granted, and defendant’s motion to preclude certain evidence under the

law-of-the-case doctrine is granted in part. Defendant’s motions to preclude expert testimony on

lost profits damages, to preclude undisclosed witnesses, and to preclude designation of

deposition testimony are denied.

SO ORDERED.

/s/ Rachel Kovner

RACHEL P. KOVNER

United States District Judge

Dated: February 10, 2022

Brooklyn, New York