Walsh v. Versa Cret Contracting Company Inc.

UNITED STATES DISTRICT COURT U.S. DISTRICT COURT

EASTERN DISTRICT OF NEW YORK EASTERN DISTRICT OF NEW YORK

--------------------------------------------------------------------X LONG ISLAND OFFICE

MARTIN J. WALSH, Secretary of Labor,

United States Department of Labor,

Plaintiff,

ORDER

21-CV-5697 (JMA) (JMW)

-against-

VERSA CRET CONTRACTING COMPANY, INC.,

ORLANDO MARTINS, Individually and as Officer,

and CECILIA MARTINS, Individually and as Officer,

Defendants.

--------------------------------------------------------------------X

A P P E A R A N C E S:

Hollis Virginia Pfitsch, Esq.

U.S. Department of Labor

Employment Law Unit

201 Varick Street, Room 983

New York, NY 10014

Attorney for Plaintiff

Jordan Laris Cohen

Office of the Solicitor, U.S. Department of Labor

New York Regional Office

201 Varick St., Rm 983

New York, NY 10014

Attorney for Plaintiff

Saul D. Zabell, Esq.

Diana Marie McManus, Esq.

Zabell & Collotta, PC

One Corporate Drive, Suite 103

Bohemia, NY 11716

Attorneys for Defendants

WICKS, Magistrate Judge:

“The art and science of asking questions is the source of all knowledge.”1

Plaintiff, Secretary of Labor, commenced this action pursuant to the Fair Labor Standards

Act (“FLSA”), to restrain Defendants from obstructing the Secretary’s investigation into

Defendants’ FLSA violations and retaliating against cooperating employees, as well as to

recover back wages and liquidated damages. (DE 1.) The present discovery dispute between the

parties is the latest of many in this case. The dispute concerns the assertion of manifold

privileges by Plaintiff’s counsel during the depositions of four non-party witnesses. (DE 43; DE

44; DE 51.) Over the course of four separate depositions, Defendants’ counsel objected to

twenty-two questions, invoking three distinct privileges, namely, the law enforcement privilege,

the informant’s privilege, and the attorney-client privilege. (DE 43; DE 44; DE 51.) Each of the

questions and the privileges relied upon by Plaintiff are set forth in Appendix A to this Order.

On January 18, 2023, during the deposition of non-party witness, Gene Toledo, Wage

and Hour Investigator, Defendants’ counsel called the Court to resolve a deposition dispute.

(Electronic Order, dated Jan. 18, 2023.) The parties were directed to resume the deposition,

move on to other topics, and to submit letter briefs outlining the disputed questions, the specific

privileges, and the parties’ arguments. (DE 43; DE 44; Electronic Order, dated Jan. 18, 2023.)

The parties later called again for a ruling concerning similar issues, but this time in anticipation

of the deposition of Wage and Hour Assistant District Director, William Dempsey, which was

scheduled to take place the very next day on January 19, 2023. (Id.)

On February 16, 2023, the parties found themselves in yet another deposition kerfuffle.

During the depositions of Wage and Hour Investigators Nicole Stahl and Tricia Prepetit, Plaintiff

1 Thomas Berger, American novelist.

asserted certain privileges and again directed each deponent not to answer. The parties also

briefed these questions. (DE 51.) Defendants seek to compel non-party witnesses Gene Toledo,

William Dempsey, Nicole Stahl and Tricia Prepetit to respond to the subject questions. Plaintiff,

in turn, seeks a protective order.

For the reasons set forth below, Defendants’ Motion to Compel (DE 43; DE 51) is

DENIED and Plaintiff’s Cross-Motion for a Protective Order (DE 44; DE 51) is GRANTED

with respect to the subject questions.2

THE STANDARD

Rule 26 of the Federal Rules of Civil Procedure governs the scope of discovery. Pursuant

to Fed. R. Civ. P. 26:

Parties may obtain discovery regarding any nonprivileged matter that is relevant to

any party’s claim or defense and proportional to the needs of the case, considering

the importance of the issues at stake in the action, the amount in controversy, the

parties’ relative access to relevant information, the parties’ resources, the

importance of the discovery in resolving the issues, and whether the burden or

expense of the proposed discovery outweighs its likely benefit.

Fed. R. Civ. P. 26(b)(1).

Information “is relevant if: ‘(a) it has any tendency to make a fact more or less probable

than it would be without the evidence; and (b) the fact is of consequence in determining the

action.’” Vaigasi v. Solow Mgmt. Corp., No. 11-CV-5088, 2016 WL 616386, at *11 (S.D.N.Y.

Feb. 16, 2016) (quoting Fed. R. Evid. 401). This standard is applied more liberally during

discovery than at trial. Id. Permissible discovery under Rule 26 must be relevant “to any party’s

claim or defense,” and “proportional to the needs of the case.” Pothen v. Stony Brook Univ., No.

13-CV-6170 (JFB) (AYS), 2017 WL 1025856, at *3 (E.D.N.Y. Mar. 15, 2017) (citing Fed. R.

2 The Court reserves decision and will issue a separate Order on the issues pertaining to Stahl and

Prepetit’s review of documents prior to each of their respective depositions.

Civ. P. 26(b)(1)). Proportionality goes “hand-in-hand” with relevance and so the more relevant

the information sought is, the less likely a court would find the subject discovery

disproportionate. New Falls Corp. v. Soni, No. 16-CV-6805 (ADS) (AKT), 2020 WL 2836787,

at *2 (E.D.N.Y. May 29, 2020).

“[A] court may, for good cause, issue an order to protect a party or person from

annoyance, embarrassment, oppression, or undue burden or expense . . . .” Fed. R. Civ. P.

26(c)(1); see Gordon v. Target Corp., 318 F.R.D. 242, 246 (E.D.N.Y. 2016) (“[T]he touchstone

for determining whether to issue a protective order under Rule 26(c) lies, in the first instance, on

a party’s ability to establish good cause.”). “Rule 26(c) confers broad discretion on the trial

court to decide when a protective order is appropriate and what degree of protection is required.”

Seattle Times Co. v. Rhinehart, 467 U.S. 20, 36 (1984). The burden is on the party seeking the

protective order to show “good cause: through ‘particular and specific facts’ as opposed to

‘conclusory assertions.’” Rofail v. United States, 227 F.R.D. 53, 54-55 (E.D.N.Y. 2005). “If the

movant establishes good cause for protection, the court may balance the countervailing interests

to determine whether to exercise discretion and grant the order.” Id. at 55.

Seeking a protective order to prevent disclosure of privileged material is the appropriate

procedural course. See, e.g., Sec. of Lab. v. Superior Care, 107 F.R.D. 395, 398 (E.D.N.Y.

1985) (granting a protective order because defendant had other means to prepare for trial);

Galvin v. Hoblock, No. 00-CV-6058 (DAB) (MHD), 2003 WL 22208370, at *7-8 (S.D.N.Y.

Sept. 24, 2003) (granting, in part, a protective order as to the privileged documents because

defendant had not shown a compelling need to overcome the privilege).

DISCUSSION

Plaintiff’s directives to the witnesses not to answer are all predicated on the assertion of

several distinct privileges. Thus, it is Plaintiff who bears the burden to establish the existence

and applicability of each privilege. See von Bulow by Auersperg v. von Bulow, 811 F.2d 136,

146 (2d Cir. 1987) (“The law is clear in this circuit that a person claiming the attorney-client

privilege has the burden of establishing all the essential elements thereof.”); In re The City of

New York, 607 F.3d 923, 945 n.23 (2d Cir. 2010) (“The ultimate burden of demonstrating the

law enforcement privilege is on the party asserting the privilege.”).

The tripartite privileges asserted by Plaintiff are the: (1) informant’s privilege; (2) law

enforcement privilege; and (3) attorney-client privilege. The relevant legal standards for the

informant’s privilege and the attorney-client privilege are laid out in the Court’s prior Orders and

are incorporated here by reference. (See DE 26 at 5-12 (discussing informant’s privilege, and

attorney-client privilege).) As to the law enforcement privilege, however, it

is a qualified privilege which establishes a presumption against disclosure for

information (1) pertaining to law enforcement techniques and procedures, (2) that

would undermine the confidentiality of sources, (3) that would endanger witnesses

and law enforcement personnel, (4) that would undermine the privacy of

individuals involved in an investigation, or (5) that would seriously impair the

ability of a law enforcement agency to conduct future investigations.

Morales v. United States, No. 18-CV-4247 (CBA) (RER), 2020 WL 6799681, at *2 (E.D.N.Y.

Nov. 19, 2020) (quoting In re The City of New York, 607 F.3d at 948).

“The presumption against disclosure may be overcome by a party demonstrating that (1)

its suit is non-frivolous, (2) the information is not available elsewhere, and (3) the party has a

compelling need for the information.” Id. at 2. Where such a showing is made, the court must

weigh the interests in favor of and against “disclosure to determine whether the information

should be disclosed.” Id.

Where the party asserting the law enforcement privilege has already commenced the

action like here, courts have substituted the first requirement for a showing that the party seeking

disclosure “seeks the discovery in good faith.” See F.T.C. v. Timeshare Mega Media and

Marketing Group, Inc., No. 10-CV-62000, 2011 WL 6102676, at *5 (S. D. Fla Dec. 7, 2011)

(construing this requirement as a general one of good faith where the FTC initiated the initial

action).

A. Questions 1-8 of Gene Toledo’s Deposition, Question 1 of William Dempsey’s

Deposition, Questions 1-4 of Nicole Stahl’s Deposition and Question 1 of Tricia

Prepetit’s Deposition Invoking the Law Enforcement Privilege and the Informant’s

Privilege

Plaintiff contends that both the law enforcement privilege and the informant’s privilege

apply to Questions 1 through 8 of Gene Toledo’s Deposition, Question 1 of William Dempsey’s

Deposition, Questions 1-4 of Nicole Stahl’s Deposition and Question 1 of Tricia Prepetit’s

Deposition. Defendants counter that the Plaintiff has failed to properly invoke the law

enforcement privilege and that the informant’s privilege does not apply to the questions at issue.

Here, Plaintiff has failed to meet his burden of proving that the law enforcement privilege

applies to the subject questions. Plaintiff attempts to meet his burden by arguing that the

initiation of WHD’s investigation “‘pertains to law enforcement techniques and procedures’; its

release also may ‘undermine the confidentiality of sources,’ ‘endanger witness[es],’ or ‘interfere

[] with an investigation.’” (DE 44 at 2; DE 51 at 10.) But this argument is insufficient alone.

In Coleman, the court found that the defendants’ argument that the law enforcement

privilege should apply because “the information in the [IAU] [R]eport concerns law enforcement

techniques and procedures, information that would undermine the privacy of individuals

involved in the investigation and, if revealed beyond the parties, would seriously impair the

ability of law enforcement agencies to conduct future investigations” was “merely a restatement

of the of the type of information the privilege is meant to protect.” See Coleman v. Cnty. of

Suffolk, 174 F. Supp. 3d 747, 757 (E.D.N.Y. 2016), aff'd, 685 F. App'x 69 (2d Cir. 2017).

Similarly, here, Plaintiff’s argument is a mere description of what the law enforcement

privilege protects without more. Plaintiff also has not made a “‘clear and specific evidentiary

showing’ of the harm that would occur should the [information] be disclosed.” Id. Since

Plaintiff has failed to carry his burden, this Court need not reach the issue of whether Defendant

has established a compelling need for the information regarding how the investigation began.

Nonetheless, the informant’s privilege does apply. Plaintiff asserts that responses to

these questions “may tend to reveal the identity of any individuals involved as confidential

informants.” (DE 44 at 2; DE 51 at 10.) Plaintiff further contends that Defendants cannot meet

their burden of demonstrating how the initiation of the investigation is essential to their defense.

(DE 44 at 2; DE 51 at 10.) Finally, Plaintiff notes that it has produced the case file, which

includes all the facts gathered that lead to the initiation of the investigation. (DE 44 at 3; DE 51

at 10.)

Defendants contend that they “have not sought the identity of any witness or informant in

either deposition.” (DE 43 at 1; DE 51 at 1.) Instead, Defendants claim that “responses to the

questions at issue would reveal only how the investigation began, timing of witness statements

and interview, personal opinions of the deponent, and information completely unrelated to

witnesses altogether.” (DE 43 at 1-2; DE 51 at 1.) The Court disagrees.

To conclude otherwise would allow one to do indirectly what cannot do directly. In their

own letter brief, the Defendants reference this Court’s previous finding that the informant’s

privilege is not restrained simply to questions regarding the identity of informants. (See DE 43

at 1 (“[T]his Court has opined ‘the privilege applies to the informant’s identity only and not the

substance of the informants communications . . .’ unless disclosure of the contents is likely to

reveal the identity of an informer.”) (internal citations omitted) (emphasis added).) The

informant’s privilege applies to the substance of the informant’s communications when

disclosure of the contents is likely to reveal the identity of the informant. See Walsh v. Versa

Cret Contr. Co., No. 21-CV-5697 (JMA) (JMW), 2022 U.S. Dist. LEXIS 134448, *7 (E.D.N.Y.

July 28, 2022) (quoting Carbajal v. Village of Hempstead, No. 02-CV-4270 (ADS) (ETB), 2003

WL 23138447 at *2 (E.D.N.Y. Dec. 22, 2003)).

Defendants have not met their burden of establishing that their need for disclosure

outweighs the government’s need for secrecy. See In re United States, 565 F.2d 19, 23 (2d Cir.

1977) (holding the party seeking disclosure of the informant’s identity and/or communications

bears the burden of establishing the need for such disclosure); see also Superior Care, 107

F.R.D. at 397 (“In this Circuit the burden of establishing the need for disclosure is on the party

that seeks it and the burden is not met by a showing that the information would merely be of

some assistance to the party.”). First, details such as when and why the investigation began, and

the timing of conversations with Versa Cret employees could very well lead to revealing the

identity of a confidential informant. Second, Defendants cannot demonstrate how the initiation

of the investigation is essential to their defense. Rather, Defendants’ sole argument is that the

informant’s privilege is inapplicable to the subject Questions. This conclusory assertion, without

more, is insufficient to overcome the assertion of the privilege here.

Finally, the case is still in the discovery stage, and Defendants have other means to

prepare their defense. Disclosure of an informant’s identity is typically not proper at the

discovery stage. Herman v. Crescent Pub. Grp., Inc., No. 00-CV-1665 (SAS), 2000 WL

1371311, at *8 (S.D.N.Y. Sep. 21, 2000). Plaintiff has produced the case file containing all facts

gathered precipitating the investigation, Defendants still have access to their own records, and

are free to interview or depose any past or current employee. In the context of this FLSA case,

the existence of these alternative means of defense indicates that Plaintiff’s need for secrecy

outweighs Defendants’ need for disclosure.

B. Question 2 of William Dempsey’s Deposition Invoking the Law Enforcement Privilege

Plaintiff also argues that the law enforcement privilege applies to Question 2 of William

Dempsey’s deposition: “How many people were carrying guns [at the execution of the

warrant]?” Plaintiff argues that Question 2 pertains to law enforcement techniques and

procedures, that responsive information would endanger witnesses and law enforcement

personnel and would interfere with an investigation. (DE 44 at 4.) The Court agrees.

Plaintiff elaborates that personnel can encounter resistance to the execution of search

warrants by employers, which can include the use of firearms. (DE 44 at 4.) Plaintiff notes that

to reveal the number of armed personnel at the execution of such warrants would reveal “a core

law enforcement technique” which “goes to the cooperation of investigation subjects” and “the

safety of agency personnel and the public.” (DE 44 at 4.) Defendants argue that revealing the

number of armed personnel at the execution of the search warrant will not undermine the

confidentiality of the investigation or endanger present or future individuals. (DE 43 at 4.)

Rather, Defendants contend that the information is “sought to be precluded as a ‘technique’ of

law enforcement.” (DE 43 at 4.) Defendants maintain that such arguments are insufficient to

preclude Dempsey’s testimony or carry Plaintiff’s burden.

The Court finds that revealing the exact number of armed personnel present at the

execution of the warrant would not necessarily undermine the confidentiality of the

investigation. And Plaintiff’s assertion that revealing this information endangers witnesses and

law enforcement personnel is without any empirical data, and perhaps a bit attenuated though not

implausible. Cf. In re The City of New York, 607 F.3d at 944 (finding that requiring disclosure of

redacted undercover field reports would reveal information clearly related to law enforcement

techniques and procedures).

Here, although Defendants satisfy the first two prongs to overcome the presumption

against disclosure, the Court finds that Defendants fail to provide a “compelling need” for this

information. (DE 44 at 4.) Defendants themselves reference William Dempsey’s prior

testimony regarding the presence of armed personnel during the execution of the search warrant

in their letter brief. (DE 43 at 4.) Defendants make no argument as to why the exact number of

armed personnel is required for their defense. Moreover, Plaintiff already permitted Defendants

to ask whether the officers were visibly armed. (DE 44 at 4.) Thus, Defendants have not

overcome the presumption against disclosure. Therefore, Question 2 of William Dempsey’s

deposition shall be precluded under the law enforcement privilege.

C. Questions 9 and 10 of Gene Toledo’s Deposition and Question 4 of William Dempsey’s

Deposition Invoking the Informant’s Privilege

Plaintiff argues that the informant’s privilege applies to Questions 9 and 10 of Gene

Toledo’s deposition, and to Question 4 of William Dempsey’s deposition. Defendants, however,

argue that the informant’s privilege does not apply to the questions at issue. That argument fails

for the reasons previously stated.

Defendants are correct that they have not openly sought the identity of any witness or

informant in either deposition. But again, the informant’s privilege applies to the substance of

the informant’s communications when disclosure of the contents is likely to reveal the identity of

an informer. See Carbajal, 2003 WL 23138447, at *2. Plaintiff persuasively argues that

identifying the language spoken by employee informants, the timing of investigators’

conversations with the former employees, and the specific law enforcement agency used by the

employer to threaten retaliation could all serve to identify characteristics of the informants’

identities. (DE 44 at 3.) Defendants have not countered that argument.

Accordingly, the subject Questions shall be precluded under the informant’s privilege.

D. Questions 5, 6 and 7 of William Dempsey’s Deposition Invoking the Attorney-Client

Privilege

Plaintiff asserts that Questions 5-7 of William Dempsey’s deposition are protected by the

attorney-client privilege, whereas Defendants argue that the privilege is inapplicable to the

testimony. The subject Questions are protected by the attorney-client privilege. Whether

Dempsey was instructed by counsel to review the investigatory file to prepare for the deposition

was a confidential communication made for the predominant purpose of preparing for that

deposition, i.e., legal advice. See In re County of Erie, 473 F. 3d 413, 418 (2d Cir. 2007).

Defendants argue that Question 5 (“Were you instructed to review the investigatory file in

preparation for this deposition?”) and Question 6 (“Did you not receive the instruction to review

the investigatory file in preparation for this deposition?”) required a yes or no response, and

therefore cannot be said to reveal a confidential communication. Tellingly, Defendants cite no

authority for this position. As this Court has previously held, the attorney-client privilege may

protect a deponent from answering questions, even where a simple “yes” or “no” answer is called

for, when the question concerns deposition preparation with counsel. See Pape v. Suffolk Cnty.

Soc'y for Prevention of Cruelty to Animals, No. 20-CV-01490 (JMA) (JMW), 2022 WL 1105563

at 1* n.1 (E.D.N.Y. Apr. 13, 2022).3

Defendants also contend that Question 7 (“Is it safe to say you were not directed by

counsel to review the entire file?”) is not protected by the attorney-client privilege because it

sought confirmation of the absence of a communication. Defendants again cite no authority for

3 Defense counsel here was also counsel in the Pape case.

this proposition, which could also have applied to Question 6. However, the attorney-client

privilege protects a deponent from answering a question regarding deposition preparation,

regardless of whether the question seeks the to confirm the existence or absence of a

communication relating to legal advice. Id. This is distinguished from questions to a witness

about the scope and extent of document searches undertaken in response to document demands

propounded, which are entirely proper. See, e.g., Haroun v. ThoughtWorks, Inc., No. 20-CV-0100

(LJL), 2020 WL 6828490, at *2 (S.D.N.Y. Oct. 7, 2020) (“Plaintiff can inquire at deposition both about

the documents that have been produced and those that have not been produced and can review the

document production itself for obvious gaps.”).

E. Protective Order

In light of the foregoing, Plaintiff has established good cause for the issuance of a

protective order sustaining the Plaintiff’s assertions of privilege.

CONCLUSION

For the reasons stated above, the Court finds that Plaintiff has shown the informant’s

privilege applies to Questions 1-10 of Gene Toledo’s deposition, Questions 1 and 4 of William

Dempsey’s deposition, Questions 1-4 of Nicole Stahl’s deposition and Question 1 of Tricia

Prepetit’s deposition. Plaintiff has also shown that the law enforcement privilege applies to

Question 2 of William Dempsey’s deposition. Plaintiff has also carried his burden to show that

the attorney-client privilege applies to Question 4-7 of William Dempsey’s deposition.

Defendants’ Motion to Compel (DE 43) is DENIED and Plaintiff’s Cross-Motion for a

Protective Order (DE 44) is GRANTED as to the subject questions.4 Accordingly, the subject

Questions shall be precluded.

Dated: Central Islip, New York SO ORDERED:

March 23, 2023

James M. Wicks

/S/

JAMES M. WICKS

United States Magistrate Judge

4 Plaintiff indicated in his letter brief that although Question 3 of William Dempsey’s deposition was

listed on the Joint Addendum, the Question was not marked as an issue to be brought before the Court.

Furthermore, Defendants have not mentioned Question 3 in their letter brief. Therefore, the Court has

declined to consider whether any privilege applies to Question 3.

Appendix A

IP – Informant’s Privilege

LEP – Law Enforcement Privilege

A-C – Attorney Client Privilege

DP – Deliberative Process

Questions from Gene Toledo’s Deposition IP LEP A-C IP &

LEP

1. Was the investigation precipitated by an employee X

complaint?

2. Why did the investigation begin? X

3. How was the other case initiated? X

4. At the time of your initial conversation with Bill Dempsey X

you had not spoken with any employees of Versa Cret?

5. When was the first time you spoke with an employee of X

Versa Cret?

6. Why did Francisco Marchan put statements in your X

investigative file?

7. Explain to me why [you were reluctant to reveal Francisco X

Marchan’s involvement]?

8. What is the reason Francisco Marchan took statements that X

were not signed?

9. Were those statements taken in a language you don’t X

speak?

10. When was the last time you spoke to a former employee? X

Questions from William Dempsey’s Deposition IP LEP A-C IP &

LEP

1. What precipitated this investigation? X

2. How many people were carrying guns? [at the execution of X

the warrant]?

3. What steps have the Wage and Hour office taken to

investigate this matter once the litigation has begun?

4. What law enforcement agency did Martins threaten to go X

to?

5. Were you instructed to review the investigatory file in X

preparation for this deposition?

6. Did you not receive the instruction to review the X

investigatory file in preparation for this deposition?

7. Is it safe to say you were not directed by counsel to review X

the entire file?

Questions at Issue from Nicole Stahl’s Deposition IP &

LEP

1. Did you have occasion to introduce [Wage and X

Investigator] Toledo to any of your complainants from

Versa Cret 1 or 2?

2. So, you do remember identifying three complainants, X

correct?

3. Were there three complainants in Versa Cret 1? X

4. The statements that you received from the three employees X

of Versa Cret 1, did any of those statements contain a

complaint?

Question at Issue from Tricia Pepetit’s Deposition IP &

LEP

1. What did [other Wage and Hour personnel] relay to you X

about how they became aware of the existence of the

notebook?