Jones Day v. Serenity Pharmaceuticals, LLC

Summary

The Appellate Division, First Department, modified an order compelling discovery in Jones Day's claims involving veil piercing and fraudulent conveyance. The court upheld discovery concerning distributions received by Serenity Pharmaceuticals from Allergan and Serenity's disposition of those funds, but denied discovery of the individual defendants' tax returns, investment and bank account statements, and financial planning and audit documents. It also limited interrogatory responses about affiliated trusts to trusts that had engaged in transactions with Serenity.

Holdings

1. The court properly compelled Serenity to produce all documents relating to distributions it received from Allergan and Serenity's disposition of those funds because the requested disclosures were material and necessary to prosecute the veil-piercing and fraudulent-conveyance claims.
2. Discovery was not properly limited to the specific April 2018 conveyance identified in the complaint and prior motion-to-dismiss decision, and plaintiff was entitled to discovery concerning transactions predating its retention to represent defendants in the underlying patent litigations.
3. The individual defendants' tax returns, investment and bank-account statements, financial-planning documents, and audit documents were not shown to be material and necessary, so the order compelling production of those records was improperly granted.
4. The required response to interrogatories concerning trusts affiliated with the individual defendants was properly limited to trusts that had engaged in transactions with Serenity.
5. Defendants' failure to include the transcript of oral argument did not warrant dismissal of the appeal under the circumstances.

Questions Presented

1. Whether the court properly compelled Serenity to produce documents concerning distributions received from Allergan and Serenity's disposition of those funds.
2. Whether discovery could be limited to a specific April 2018 conveyance or had to include earlier transactions.
3. Whether discovery was permissible concerning transactions predating Jones Day's retention to represent Serenity in underlying patent litigation.
4. Whether the individual defendants' tax returns, investment and bank-account statements, financial-planning documents, and audit documents were material and necessary to the claims.
5. Whether interrogatories concerning affiliated trusts should be limited to trusts that had engaged in transactions with Serenity.
6. Whether defendants' failure to include the transcript of oral argument required dismissal of the appeal.

Disposition

other