Case of the Day: Application of Coalition to Protect Clifton Bay

The case of the day is In re Application of the Coalition to Protect Clifton Bay (S.D.N.Y. 2014). Peter Nygård was the longtime owner of Nygård Cay in the Bahamas. Louis Bacon owned a neighboring parcel, Point House. The Coalition to Protect Clifton Bay had brought two actions in the Bahamas challenging the supposed failure of the Bahamian government to oversee Nygård’s expansion of Nygård Cay. Nygård sought to intervene in those actions. Bacon, who opposed Nygård’s work on his property, had separately sued several of Nygård’s associates for defamation, claiming they were part of a “smear campaign” against him. Nygård, taking a page perhaps from Steven Donziger, had a videographer, Stephen Feralio, who filmed “Nygård’s daily life, both personal and professional, including meetings between Nygård and Bahamian officials,” and who also allegedly “aided in the production of anti-Bacon videos.” The Coalition and Bacon, taking a page from Gibson Dunn, sought an order under § 1782 allowing a subpoena to Feralio to obtain the videos. Did I say taking a page from Gibson Dunn? I misspoke—Gibson Dunn is actually representing the Coalition and Bacon!

While I love these facts, the decision itself is quite straightforward. All the statutory prerequisites were met, and the Intel factors favored discovery. The only interesting doctrinal point was that Feralio had apparently decided he wanted to cooperate with Bacon and the Coalition, and that the only reason for the proceedings was that Feralio feared legal action against him by Nygård if he simply turned over the tapes without legal compulsion. Nygård claimed that granting the request would be unduly intrusive or burdensome, but Feralio himself made no such argument, and the judge held, correctly I think, that burden and intrusiveness is to be measured from the perspective of the target of the subpoena, not interested third parties. This seems right—there was no privilege at issue here.

Nygård also suggested that the judge should deny the application because the materials were his, and not Feralio’s to give, and that Feralio had essentially misappropriated them and offered them to Nygård’s enemies. But the judge found no precedent for such an argument. The admissibility of the evidence will be for the Bahamian courts.

Last, Nygård claimed that the application was made for purposes of harassment. And in fact that application contained “allegations that besmirch Nygård’s charater” and “reflect poorly” on him. The judge noted that Nygård had done the same thing, and that the court had already “taken measures to place inappropriate accusations beyond the public record.” But in the end, the judge held that the inappropriate allegations did not show that the petition “was brought solely or even principally to harass.”

In this kind of ego-driven land use litigation between two rich guys, I can tell you that there will only be one winner: the lawyers. You can read more about the case here.

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