Court Opinion

ID: 9952889
Source: CourtListenerOpinion
Date Created: 2024-03-20 20:11:12.169506+00
Date Added: 2024-06-11T14:40:47.606849
License: Public Domain

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
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                       publication.
                                                                                                                        INDEX NO. 653247/2022
  NYSCEF DOC. NO. 281                                                                                             RECEIVED NYSCEF: 03/15/2024

            SUPREME COURT OF THE STATE OF NEW YORK
            COUNTY OF NEW YORK: COMMERCIAL DIVISION PART 03M
            ----------------------------------------------------------------------------------- X

             FFS DATA CORPORATION,                                                                  INDEX NO.         65324 7/2022

                                                          Plaintiff,
                                                                                                    MOTION DATE        02/01/2024
                                                - V -
                                                                                                    MOTION SEQ. NO.        018
             THE OLB GROUP, INC.,

                                                          Defendant.                                 DECISION+ ORDER ON
                                                                                                           MOTION
            ----------------------------------------------------------------------------------- X

            HON. JOEL M. COHEN:

            The following 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
                                                                        DETERMINATION THAT DOCUMENTS ARE NOT
            were read on this motion for
                                                                             "PROTECTED INFORMATION"

                      PlaintiffFFS Data Corporation ("FFS") moves for an Order ruling 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 of the Stipulation and Order for the Production and Exchange of Confidential

            Information (the "Protective Order") entered on June 1, 2023 (see NYSCEF 105).

                      As relevant here, The Global Legal Law Firm ("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' s behalf (the "Sanchez Production").

                      Global Legal submits that it has represented Mr. Sanchez and his company Merchant

            Payment Solutions, LLC ("MPS") for over three years in a number of litigation and transactional

            matters. According to Global Legal, that included the dual representation of both Mr. Sanchez

             653247/2022 FFS DATA CORPORATION vs. THE OLB GROUP, INC.                                                   Page 1 of4
             Motion No. 018

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                                                                                                  INDEX NO. 653247/2022
  NYSCEF DOC. NO. 281                                                                     RECEIVED NYSCEF: 03/15/2024

            and MPS, on the one hand, and OLB, on the other hand, in attempting to resolve a dispute

            among them. Global Legal also submits that it represented Mr. Sanchez in producing documents

            in response to the subpoena duces tecum Global Legal served on him in 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 of documents prior to

            producing it to FSS in July 2023 because it did not believe the Sanchez Production would

            contain any attorney-client privileged information (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 behalf of MPS. That

            motion relied on certain exhibits from the Sanchez Production, specifically Exhibits 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 instant request concerns only the Five Exhibits.

            For the following reasons, Plaintiffs motion is granted.

                   "The attorney-client privilege shields from disclosure any confidential communications

            between an attorney and his or her client made for the purpose of obtaining or facilitating legal

            advice in the course of a professional relationship" (Ambac Assur. Corp. v Countrywide Home

            Loans, Inc., 27 NY3d 616, 623 [2016], citing CPLR 4503[a][l]). "Although typically arising in

            the context of a client's communication to an attorney, the privilege extends as well to

            communications from attorney to client." (Spectrum Sys. Intl. Corp. v Chemical Bank, 78 NY2d

            371,377 [1991]). Such communications "'must be made for the purpose of facilitating the

             653247/2022 FFS DATA CORPORATION vs. THE OLB GROUP, INC.                             Page 2 of 4
             Motion No. 018

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                                                                                                    INDEX NO. 653247/2022
  NYSCEF DOC. NO. 281                                                                       RECEIVED NYSCEF: 03/15/2024

            rendition of legal advice or services, in the course of a professional relationship"' (Rossi v Blue

            Cross & Blue Shield of Greater NY, 73 NY2d 588, 593 [1989], citing Matter of Creekmore, l

            NY2d 284,296 [1956]). "[T]he burden of establishing any right to protection is on the party

            asserting it; the protection claimed must be narrowly construed; and its application must be

            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 of the 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 itself from 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, we would have a

            conflict. But we are happy to provide the role of honest 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-the Five Exhibits-at most reflect Mr. 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 of interest with its

            representation of OLB (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't push too hard"]; Ex. 8 [Mr. Huber telling Mr. Sanchez that

            "[u]nfortunately, [Global Legal] can't put [itself] in th[e residual] dispute too heavily"]).

             653247/2022 FFS DATA CORPORATION vs. THE OLB GROUP, INC.                                Page 3 of 4
             Motion No. 018

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                                                                                                    INDEX NO. 653247/2022
  NYSCEF DOC. NO. 281                                                                         RECEIVED NYSCEF: 03/15/2024

                    Global Legal does not deny that it represented OLB in connection with these

            communications, whose interests at that time were clearly adverse to Mr. Sanchez. Under

            similar facts, the First Department affirmed an order holding such communications are not

            privileged and must be produced (Gottwald v Geragos, 205 AD3d 417,417 [1st Dept 2022]

            ["The emails between [defendant] and an attorney representing a third party are not privileged as

            their substance was clearly in connection with the attorney's representation of the third party,

            whose position at that time was adverse to defendants."] [citations omitted]).

                    In sum, Global Legal has not established that any of the Five Exhibits were made "for the

            purpose of facilitating the rendition of legal advice or services, in the course of a professional

            relationship" between Mr. Sanchez and Global Legal. This Decision does not address the

            remaining documents listed in Defendants' privilege log, as no motion was made with respect to

            those documents.

                    Accordingly, it is

                    ORDERED that Plaintiffs motion is GRANTED, and the Five Exhibits are determined

            not to be Protected Information for purposes of the Protective Order.

                    This constitutes the Decision and Order of the Court.

                    3/15/2024
                      DATE                                                        JOEL M. COHEN, J.S.C.
             CHECK ONE:                   CASE DISPOSED                   NON-FINAL DISPOSITION

                                          GRANTED         □ DENIED        GRANTED IN PART          □ OTHER
             APPLICATION:                 SETTLE ORDER                    SUBMIT ORDER

             CHECK IF APPROPRIATE:        INCLUDES TRANSFER/REASSIGN      FIDUCIARY APPOINTMENT    □ REFERENCE

             653247/2022 FFS DATA CORPORATION vs. THE OLB GROUP, INC.                               Page4 of 4
             Motion No. 018

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