### FFS Data Corp. v OLB Group, Inc. 2024 NY Slip Op 30854(U) March 15, 2024 Supreme Court, New York County Docket Number: Index No. 653247/2022 Judge: Joel M. Cohen Cases posted with a "30000" identifier, i.e., 2013 NY Slip

Op 30001(U), are republished from various New York State and local government sources, including the New

York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication.NYSCEF DOC. NO. 281

SUPREME COURT OF THE STATE OF NEW YORK INDEX NO. 653247/2022 RECEIVED NYSCEF: 03/15/2024

COUNTY OF NEW YORK: COMMERCIAL DIVISION PART 03M

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

FFS DATA CORPORATION, Plaintiff,

- V - THE OLB GROUP, INC., Defendant.

-----------------------------------------------------------------------------------X HON. JOEL M. COHEN: INDEX NO. 653247 /2022 MOTION DATE 02/01/2024 MOTION SEQ. NO. 018

DECISION+ ORDERON MOTION

Thefollowing e-filed documents, listed by NYSCEF document number (Motion 018) 205,206,207, 208, 209,210,211,212,213,214,215,216,217,218,219,220,221,222,223,224,225,226,227,247, 248,256,257,258,259,260,261,262 were read on this motion for DETERMINATION THAT DOCUMENTS ARE NOT "PROTECTED INFORMATION" PlaintiffFFS Data Corporation ("FFS") moves for an Orderruling that certain exhibits produced by third party Manuel Sanchez in this action do not constitute "Protected Information" (i.e., documents protected from disclosure pursuant to CPLR 3101(c), 3101(d)(2) and 4503) under paragraph 17 ofthe Stipulation and Order for the Production and Exchange ofConfidential Information (the "Protective Order") entered on June 1, 2023 (see NYSCEF 105). As relevanthere, The Global Legal LawFirm ("Global Legal")-counsel for Defendant OLB Group, Inc. ("OLB") in this case- is asserting attorney-client privilege over documents produced over six months ago by a third party named Manuel Sanchez, whom Global Legal subpoenaed in this matter on OLB'sbehalf(the "Sanchez Production"). Global Legal submits that ithas represented Mr. Sanchez and his company Merchant Payment Solutions, LLC ("MPS") for overthree years in a number oflitigation and transactional matters. According to Global Legal, that included the dual representation ofboth Mr. Sanchez

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and MPS, on the one hand, and OLB, on the otherhand, in attempting to resolve a dispute among them. Global Legal also submits that itrepresented Mr. Sanchez in producing documents in response to the subpoena duces tecum Global Legal served on himin this case on June 2, 2023, and in defending his deposition on September 15, 2023 (NYSCEF 256 ["Huber Affirm"]

Global Legal did not review Mr. Sanchez's first production ofdocuments prior to producing it to FSS in July 2023 because it did notbelieve the Sanchez Production would contain any attorney-clientprivilegedinformation (Huber Affirm 

### ,J,Jl2-13). FFS introduced certain documents from that production, without objection, at Mr. Sanchez's deposition in September 2023 (NYSCEF 214). Separately, in January 2024, FFS's counsel filed a motion to dismiss a related action in Hawaii federal court filed by Global Legal on behalfofMPS. That motion relied on certain exhibits from the Sanchez Production, specificallyExhibits 5-9 to the Hawaii Declaration (the "Five Exhibits," NYSCEF 222, Ex. 5, 6, 7, 8, 9]). Thereafter, in this case, Global Legal asserted attorney-client privilege over the Sanchez Production, including the Five Exhibits. FFS's instantrequest concerns only the Five Exhibits. Forthe following reasons, Plaintiffs motion is granted. "The attorney-clientprivilege shields from disclosure any confidential communications between an attorney and his orher clientmade for the purpose ofobtaining or facilitating legal advice in the course ofa professional relationship" (AmbacAssur. Corp. v CountrywideHome Loans, Inc., 27 NY3d 616, 623 [2016], citing CPLR4503[a][l]). "Although typically arising in the context ofa client's communication to an attorney, the privilege extends as well to communications from attorney to client." (Spectrum Sys. Intl. Corp. v ChemicalBank, 78 NY2d 371,377 [1991]). Such communications "'mustbe made for the purpose offacilitating the

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rendition oflegal advice or services, in the course ofa professional relationship"' (Rossi vBlue Cross & Blue Shield of GreaterNY, 73 NY2d 588, 593 [1989], citingMatter of Creekmore, l NY2d 284,296 [1956]). "[T]he burden ofestablishing any right to protection is on the party asserting it; the protection claimed mustbe narrowly construed; and its application mustbe consistent with the purposes underlying the immunity" (Spectrum Sys., 78 NY2d at 377). Here, even assuming that Global Legal represented Mr. Sanchez and MPS in various matters since 2020, Global Legal has failed to demonstrate that it represented Mr. Sanchez or MPS in their negotiations with OLB, which is the subject ofthe Five Exhibits at issue. In that context, Mr. Sanchez was inquiring about OLB's outstanding payment ofMPS's January 2023 residual. The documents are commercial communications, not requests for legal advice. Moreover, Global Legal took pains to distance itselffrom representing Mr. Sanchez in the discussions with OLB. Mr. Sanchez sent a February 28, 2023 email to Global Legal making what appears to be his first request to recover this residual payment from OLB. Global Legal responded: "We represent OLB regarding this whole dispute. Therefore, wewouldhave a conflict. Butwe are happy to provide the role ofhonest broker to help you get down on the situation." (NYSCEF 224 [emphasis added]). Following this email, Mr. Sanchez's subsequent emails demanding payment from OLB-theFive Exhibits-atmost reflectMr. Sanchez's requests for assistance obtaining payment from Global Legal's client, OLB. Furthermore, in those emails, Global Legal again reiterated that it had a potential conflict ofinterestwith its representation ofOLB (see NYSCEF 222, Ex. 7 [Mr. Huber telling Mr. Sanchez he would mention the outstanding January 2023 commission to OLB, noting that Global Legal was "in a potential conflict though so can'tpush too hard"]; Ex. 8 [Mr. Hubertelling Mr. Sanchez that "[u]nfortunately, [Global Legal] can'tput [itself] in th[e residual] dispute too heavily"]).

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Global Legal does not denythat itrepresented OLB inconnection withthese communications, whose interests atthat time were clearly adverse to Mr. Sanchez. Under similarfacts, the First Department affirmed an orderholding such communications are not privileged andmustbe produced (Gottwaldv Geragos, 205 AD3d417,417 [1st Dept 2022] ["The emails between [defendant] and an attorney representing a thirdparty are notprivileged as their substance was clearlyin connectionwiththe attorney's representation ofthe third party, whose position at thattime was adverse to defendants."] [ citations omitted]). In sum, Global Legal has not established that any ofthe Five Exhibits were made "forthe purpose offacilitating the rendition oflegal advice or services, inthe course ofaprofessional relationship" betweenMr. Sanchez and Global Legal. This Decision does not address the remaining documents listed inDefendants' privilege log, as no motionwas made withrespectto those documents. Accordingly, itis ORDERED that Plaintiffsmotion is GRANTED, andthe Five Exhibits are determined not to be Protected Information for purposes ofthe Protective Order. This constitutes the Decision and Order ofthe Court.

3/15/2024

DATE CHECK ONE:
APPLICATION: CHECK IF APPROPRIATE: CASE DISPOSED GRANTED**□** DENIED SETTLE ORDER INCLUDES TRANSFER/REASSIGN

653247/2022 FFS DATA CORPORATION vs. THE OLB GROUP, INC. Motion No. 018

4 of 4 JOEL M. COHEN, J.S.C. NON-FINAL DISPOSITION GRANTED IN PART SUBMIT ORDER FIDUCIARY APPOINTMENT

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