27 FEDERAL SUPPLEMENT, 2d SERIES

404 27 FEDERAL SUPPLEMENT, 2d SERIES process, messenger service, transportation, and deposition transcripts). The Second Cir- cuit, however, has disallowed reimbursement for computer research on the grounds that it "is merely a substitute for an attorney's time that is compensable under an application for attorneys' fees and is not `a separately tax- able cost." United Stalest Merritt Meridi- an Const. Corp, 95 F.3d 153, 173 (2d Cir. 1996); see also LeBlanc—Sternben I Fletch- er, 143 F.34 748, 763 (2d Cir.I998). There- fore, I will not allow plaintiffs attorney to be reimbursed $125.13 for her computer re- search time. Accordingly, plaintiffs attorney is entitled to an award of costs in this case in the amount of $3,525.86. CONCLUSION For the foregoing reasons, plaintiffs mo- tion for attorney's fees and costs, pursuant to 42 U.S.C. § 1988, is granted in part, and plaintiffs attorney, Margaret Somerset, is awarded $94,738.16. That sum shall be paid within forty-fwe (45) days of the entry of this order. IT IS SO ORDERED. UNITED STATES of America, Plaintiff, I Jeffrey E. EPSTEIN, Ivan S. Fisher, Ellyn Bank, Debra Elise Cohen, Diane Fisher d/b/a the Fisher Group Fisher & Softer a/k/a Fisher & Sophir, D. Ger- zog, Robert lleilbrun, Suzanne McDer- mott, Christopher II. Martin, Jesse Sie- gel a/k/a Jessie Siegel, Siegel, Martin & Ileilbrun, Ron Softer, and Carmen Tau- sik, Defendants. No. 96 CIV. 8307(DC). United States District Court, S.D. New York. March 31, 1998. Federal government, as landlord, brought proceeding to evict tenants from building. Government moved for partial sum- mary judgment. The District Court, Chin, J., held that: (1) lease unambiguously provided that written consent to sublease was re- quired, precluding claim that government orally consented to sublease; (2) court could apply federal common law to question of whether landlord's consent to sublease was subject to requirement that it not be unrea- sonably withheld; (3) court would apply law of New York, as there was no federal com- mon law on question and no need to create any; and (4) under New York law there was no requirement that consent not be unrea- sonably withheld. Motion granted. 1. Contracts e=147(2) If an agreement sets forth the parties' intent clearly and unambiguously, a court need look no further. 2. Contracts e=,176(2) Whether the text of an agreement is ambiguous or unambiguous is a matter of law to be decided by the court. 3. Contracts e=443(2) A contract is not deemed ambiguous un- less it is reasonably susceptible of more than one interpretation, and the court makes this determination by reference to the contract alone. 4. United States 4=70(7) Provision of lease with United States as landlord, that "Tenant may sublet...with the advance written permission of Landlord," precluded any oral sublease agreement 5. Landlord and Tenant e=76(3) Generally, under New York law, when a lease requires a tenant to obtain the prior written consent of the landlord to sublet or assign leased premises, a landlord may re- fuse consent arbitrarily, unless the lease con- tains a clause specifically stating that the landlord may not unreasonably withhold such consent. EFTA00187391 6. Federal Courts ea413 Federal court could apply federal com- mon law, as opposed to state law, to determi- nation of rights under real property lease with government as landlord. 7. Federal Courts ea413 Law of New York, rather than federal common law, would be applied to question whether consent of government, as landlord, to tenant's sublease of premises was subject to requirement that it not be unreasonably withheld; there was no body of federal com- mon law governing question and no pressing need for national uniformity calling for cre- ation of such law, while state law of landlord and tenant was well developed and parties probably entered into lease believing state law would apply. 8. United States ea70(7) Under New York law, there was no re- quirement that consent of federal govern- ment, as landlord, to sublease not be unrea- sonably withheld; there was no provision to that effect in lease, and under those circum- stances consent could be withheld for any reason or no reason. Mary Jo White, United States Attorney, by Serene K. Nakano, Assistant United States Attorney, New York City, for the United States. Wachtel & Masyr, LLP, by Steven J. Co- hen, New York City, for Jeffrey E. Epstein. Gage & PayRs, by G. Robert Gage, Jr, Ellen J. Casey, New York City, for Ivan S. Fisher, Diane Fisher, Fisher & Softer. Ellyn Bank, New York City, pro se. Debra Elise Cohen, New York City, pro se. D. Gerzog, New York City, pro se. Robert Heilbrun, New York City, pro se. I. The additional defendants are Ellyn Bank. De- bra Elisa Cohen• Diane Fisher dAda The Fisher Ma sher & Soifer a4/a Fisher & Sophir, D. Gerzog, Robert Heilbrun. Suzanne McDermott, Christopher H. Martin. Jesse Siegel wlr/a Jessie Siegel, Siegel• Martin & Heilbrun, U.S. I. EPSTEIN 405 ale ss27 F.Suppld 404 (S.D.N.Y. 1918) Suzanne McDermott, New York City, pro se. Christopher H. Martin, New York Defend- ers Service, New York City, pro se. Jessie Siegel, New York City, pro se. Siegel, Martin & Heilbrun, by Robert Heil- brun, New York City, pro se. Ron Softer, New York City, pro se. Carmen Tausik, New York City, pro se. OPINION CHIN, District Judge. In this case, the United States (the "Gov- ernment") seeks to evict defendants from a building formerly used as a residence by the Deputy Consul General of the Islamic Re- public of Iran ("Iran"). After diplomatic and consular relations with Iran were severed in 1980, the Office of Foreign Missions ("0FM") of the United States Department of State took poas.ssion of the budding pursuant to the Foreign Missions Act, 22 U.S.C. § 4301 of seq. 0FM leased the building to defen- dant Jeffrey E. Epstein in 1992. Epstein sublet the building to defendant Ivan S. Fish- er in 1996, purportedly without the Govern- ment's consent. Fisher, in turn, sublet a portion of the building to several subtenants. In 1996, the Government purported to ter- minate Epstein's lease and brought this ac- tion to eject Epstein and Fisher from the building. The Government later amended its complaint to assert a claim for ejectment against the subtenants as well.' The Gov- ernment also sought to recover back rent from Epstein and Fisher. Epstein and Fisher oppose ejectment on numerous grounds, some of which were re- jected when I heard oral argument in this case on December 17, 1997. Defendants' sole remaining defenses are that (1) 0FM orally consented to Epstein's proposed sublet of the premises to Fisher, and (2) 0FM did not properly terminate Epstein's lease be- Ron Soifer, and Carmen Tausik (collectively, the -Subtenants"). The Subtenants were added as defendants after the Government learned that Fisher had sublet to them without consent of OFM. EFTA00187392 406 27 FEDERAL SUPPLEMENT, 2d SERIES cause it breached an implied covenant of good faith and fair dealing by unreasonably withholding written consent to Epstein's re- quest to sublet to Fisher. Because I fmd as a matter of law that (1) the lease unambiguously required the prior written consent of OFM for Epstein to sublet or assign the premises, thereby rendering any alleged oral consent invalid, and (2) OFM was entitled under the lease to unreasonably withhold its written consent to Epstein's re- quest to sublet to Fisher, the Government's motion for partial summary judgment on its claim for ejectment is granted as against all defendants. BACKGROUND A. The Facts The premises at 34 East 69th Street in Manhattan (the "Premise?) were once the residence of the former Deputy General Con- sul of Iran. When the United States severed diplomatic ties with Iran in 1980, the Deputy General Consul vacated, but the Premises remained the property of Iran. The Govern- ment, through the Secretary of State, was entrusted with the care and maintenance of the Premises under the Foreign Missions Act ("FMA"), 22 U.S.C. § 4305(c), and the Vien- na Convention on Consular Relations, Apr. 24, 1963, art. 27(1)(a), 21 U.S.T. 77, 596 U.N.T.S. 261, a multilateral treaty entered into by the United States and Iran, among other nations. In 1992, OFM entered into a two-year lease with Epstein, to run from February 1, 1992 through January 31, 1994. The agreed rent was $15,000 per month. Pursuant to the lease's Use Clause, only Epstein, his family, servants, or approved subtenants or assignees could occupy the premises, Under the Assignment and Sublease Clause, Ep- stein was required to obtain prior written consent of OFM to assign or sublet the Premises. The lease contained no clause prohibiting OFM from unreasonably with- holding its consent to a sublet or assignment. On August 28, 1992, OFM and Epstein extended the lease for three more years, to January 31, 1997. The lease amendment did not alter either the Use Clause or the As- signment and Sublease Clause. Epstein was granted, however, a right of rust refusal to renew the lease upon its expiration at the end of January, 1997. Epstein and his family continued to reside at the Premises until January of 1996, at which time Epstein abandoned. OFM did not discover that Epstein had abandoned the Premises, however, until several months la- ter. In March of 1996, Epstein commenced negotiations with Xenophon Galinas for a possible sublease or assignment of the Prem- ises. The proposed arrangement between Epstein and Galinas included payment by Galinas to Epstein of $100,000 for improve- ments to the Premises made by Epstein dur- ing his tenancy. At the same time, Epstein also commenced negotiations to sublet the Premises to Fisher. Fisher informed Ep- stein, however, that he would not enter into a sublease unless it was approved by the State Department and Fisher could be assured that he could remain in the Premises beyond January 31, 1997. Epstein told Fisher that he had a right of first refusal under the lease amendment, and that pursuant to this right, he would take all necessary steps to renew at the end of the lease term. In the meantime, Galinas contacted OFM directly about a new lease for the Premises beginning in February of 1997. Negotiations between Galinas and OFM culminated in a "letter agreement" dated April 12, 1996 by which Galinas agreed to rent the Premises for a five-year term beginning February 1, 1997 for $16,000 per month, with yearly in- creases, up to $18,000 per month for the last year of the lease term. This agreement was expressly made subject to Epstein exercising his right of first refusal and renewing his lease for personal use only. In other words, OFM told Galinas that it would not consent to any request by Epstein for a sublet be- yond January 31, 1997, and that it would permit Epstein to renew the lease beyond that date only if he occupied the premises personally. On April 16, 1996, Epstein notified OFM by letter that he intended to exercise his right of first refusal and renew the lease. Epstein contends that in a telephone confer- ence between Richard Massey of OFM and EFTA00187393 Jeffrey Schantz, Epstein's transaction coun- sel, on April 19, 1996, OFM orally consented to Epstein's request to sublet the Premises to Fisher. The same day, Epstein wrote back, requesting "written confirmation" of OFM's alleged approval. By letter dated April 26, 1996, OFM formally responded to Epstein's request, In this letter, Thomas E. Burns, a representative of OFM, informed Epstein of OFM's intention to lease the Premises to Galines beginning February 1, 1997 in the event that Epstein decided not to renew the lease and occupy the premises personally, and denied Epstein's request to sublet the Premises to Fisher. OFM's stat- ed reasons for the denial were to (1) "mini- mize any difficulties in turning over the house to the tenant we have selected should Mr. Epstein decide not to reoccupy the premises under the new lease," and (2) "mini- mize the potential for damage to the premis- es from a short-term tenant occupancy." (Schantz Aft, Exh. D). OFM did, however, grant Epstein permission to sublet the Prem- ises to Calines for the remainder of 1996. On May 3, 1996, Epstein again wrote to OFM, formally exercising his right of first refusal, believing such right to have been triggered by the April 12, 1996 letter agree- ment between OFM and Cannes. Thereaf ter, on May 7, 1996, Epstein and Fisher entered into a sublease agreement at a rental price of $20,000 per month, despite OFM's express denial of Epstein's request for per- mission to sublet to Fisher. Fisher claims to have entered into the sublease agreement based on Epstein's representations that the sublease was approved by the State Depart- ment and that Epstein had properly exer- cised his right of first refusal to renew the lease. The original sublease was to com- mence May 7, 1996 and terminate on January 31, 1997. In the event that Epstein's lease with OFM was extended, and the new rent under that lease did not exceed $20,000 per month, the sublease would be automatically extended for an additional five-year period. On May 8, 1996, OFM wrote to Epstein informing him that his attempt to exercise his right of first refusal was premature be- cause OFM had not yet made a formal offer to lease the Premises to someone else. On U.S. 1 EPSTEIN 407 Cites, 27 PSupp.2.41 41111 (S.D.N.Y. 1990 May 10, 1996, OFM again wrote to Epstein reiterating that the exercise of his right of first refusal was premature, and explaining that the prior arrangement with Gaines was not a binding contract, but rather merely an "expression of interest: Then, on May 16, 1996, OFM officials visited the Premises and discovered that Fisher, not Epstein, was in possession. Throughout this period, Epstein continued to pay, and OFM continued to accept, rent for the Premises, despite its knowledge that Fisher was in possession. OFM accepted and deposited Epstein's May 1996 rent check on May 28, 1996. On June 3, 1996, OFM sent Epstein a notice of default, as required by the lease, stating that he was in violation of (1) the Use Clause, because he was no longer personally occupying the premises, and (2) the Assignment and Sublease Clause, because he had sublet to Fisher without prior written consent of OFM. Consistent with the terms of the Lease, Epstein was given 30 days to cure the default. On June 28, 1996, OFM accepted Epstein's June rent check. The cure period then expired on July 10, 1996. Epstein had not cured by this time, but rather than terminating the lease, OFM served Epstein with a 10-day notice to cure and demanded the July rent. OFM then accepted Epstein's check for the July rent. Finally, on August 7, 1996, OFM notified Epstein that the amended lease would be terminated as of August 23, 1996 for failure to cure the defaults. OFM demanded that Epstein vacate the Premises and return the keys on o• before that date. Despite OFM's notice of termination, Ep- stein tendered August rent on August 30, 1996. On September 18, 1996, OFM wrote to Epstein stating that rent was being accepted only through August 23, 1996, and refunded the balance to Epstein. On September 16, 1996, OFM wrote to Fisher advising that the lease agreement between OFM and Epstein had been terminated, that he was occupying the premises illegally, and demanded that the Premises be vacated immediately. Fisher met with an Assistant United States Attor- ney on September 23, 1996, who informed Fisher that Richard Massey, the OFM repre- sentative with whom Epstein dealt, would EFTA00187394 408 27 FEDERAL SUPPLEMENT, 2d SERIES swear under oath that he never orally ap- proved the sublet to Fisher. Fisher con- tends that he offered to continue paying rent directly to OFM rather than to Epstein, an offer to which the Government never re- sponded. At that time, Fisher stopped pay- ing rent to Epstein pursuant to the sublease. B. Prior Proceedings 1. The Original Actions The Government commenced this action against Epstein and Fisher in October of 1996. It seeks a declaration by the Court that it is entitled to exclusive possession of the Premises and that it is entitled to have Epstein and Fisher ejected therefrom be- cause Epstein's lease was properly terminat- ed as of August 23, 1996. In addition, the Government seeks dismissal of Fisher's first and second counterclaims, which seek equita- ble relief against the Government.' Finally, the Government demands back rent from Epstein and/or Fisher. In February of 1997, Epstein commenced a holdover proceeding in the Civil Court of the City of New York against Fisher for nonpay- ment of rent under the terms of the sublease. Fisher removed the state court action to this Court. The Government moved for partial sum- mary judgment on its claim for ejectment of Epstein and Fisher. In addition, it sought an order requiring Epstein and Fisher to pay into an escrow fund $15,000 per month from August 23, 1996 to the date this action is finally decided. Epstein cross-moved against Fisher to remand its holdover action to state court, and Fisher cross-moved against Ep- stein for consolidation of the holdover action with the pending federal action. 2. In its first counterclaim, Fisher seeks a declara- tion that the sublease is valid and that Fisher is lawfully entitled to full possession and use of the premises. In its second counterclaim, Fisher seeks a declaration that the sublease was auto- matically renewed for a five-year term. com- mencing January 31, 1997, because Epstein properly exercised his right of first refusal. 3. Technically. Epstein asserted only the first ar- gument, and Fisher asserted all four arguments. Epstein is no longer occupying the Premises, but I heard oral argument on the motions on December 17, 1997. Collectively, Epstein and Fisher asserted four arguments in oppo- sition to the Government's motion for sum- mary judgmenta They contend that there are genuine issues of material fact as to whether the Government properly terminat- ed the lease entered into between OFM and Epstein. Specifically, they argue, factual questions exists as to (1) whether the Gov- ernment waived Epstein's alleged default of the lease by accepting rent after the Govern- ment became aware that Fisher was occupy- ing the premises; (2) whether the OFM- Epstein lease permitted oral approval of an assignment or sublease (ie., whether the As- signment and Sublet Clause is ambiguous on the issue of whether an assignment or sublet could be approved orally); (3) whether OFM in fact orally approved the sublease to Fish- er; and (4) whether the Government breach- ed an obligation of good faith and fair dealing inherent in its lease with Epstein by unrea- sonably withholding written approval of a sublet to Fisher, assuming the Court holds as a matter of law that oral approval was, not permitted by the lease. At the conclusion of the argument, I re- solved several of the issues pertaining to these motions on the record. As an initial matter, I denied Epstein's motion to remand and granted Fisher's motion to consolidate. I then addressed the Government's motion for summary judgment and its application concerning the creation of an escrow fund. I granted summary judgment in favor of the Government on Epstein's and Fisher's waiver argument, holding that "no reason- able fact finder could conclude from [the) undisputed facts and the sequence of events, including the acceptance of rent after the cure period but before the actual termination still has an interest in the Court's decision as to whether OFM properly terminated its lease with Epstein. Moreover, Fisher's rights as subtenant derive from Epstein's rights as overtenant. for if I decide as a matter of law that the lease was properly terminated on August 23, 1996. neither Epstein nor Fisher has any right to occupy the Premises beyond that date. Thus, I will treat all four arguments in opposition to the Govern. ment's motion as though they were asserted by Epstein and Fisher jointly. EFTA00187395 U.S. I EPSTEIN 409 CI144027 F.3059.241 404 (S.D.N.Y. 1991) of the lease, that that could constitute a waiver in light of the very clear nonwaiver clause in the lease." (Tr. at 39). I reserved decision, however, on the following issues: (1) whether the lease unambiguously re- quired that OFM's consent to an assignment or sublet be in writing, in which case Massey could not have orally consented, as a matter of law, to Epstein's sublet of the Premises to Fisher, (2) whether OFM was permitted un- der the lease to unreasonably withhold con- sent to Epstein's consent to a sublet to Fish- er, or whether it was bound by an implied obligation of good faith and fair dealing, and (3) whether, assuming the latter, OFM in fact withheld its consent unreasonably. Finally, I ordered Epstein to pay into an escrow fund eight days worth of the $15,000 rent for the month of August 1996 and an additional $15,000 for September 1996 (be- cause OFM had already accepted his tender of rent through August 23, 1996, and Epstein had collected rent from Fisher through Sep- tember 30, 1996). Additionally, I ordered Fisher to pay into the fund $15,000 per month, beginning October 1, 1996 to date, and continuing for each month thereafter. 2. The Government's Addition of the Subtenants as Defendants In the course of discovery on its claims for relief against Epstein and Fisher, the Gov- ernment learned that Fisher had further sub- let the Premises to the Subtenants, also with- out the prior written consent of OFM. The Government then sought leave to amend the complaint pursuant to Federal Rule of Civil Procedure 15 to name the Subtenants as additional defendants in the action. I grant- ed the Government's motion on the record at the December 17, 1997 oral argument. The Government thereafter filed a second amend- ed complaint and served a copy on each of the Subtenants. In an effort to settle the case, I held a conference on January 28, 1998. At the con- clusion of that conference, the Government requested permission to file a motion seeking partial summary judgment against the Sub- tenants. By stipulation and order dated March 6, 1998, all of the named Subtenants, except for Diane Fisher &Wa The Fisher Group and Ron Softer, agreed to be bound by any order I entered with respect to Fish- er's right to occupy the Premises. On March 13, 1998, after the Government submitted its motion, Diane Fisher executed the stipula- tion and order, also agreeing to be bound. To date, Soifer still has not executed the stipulation. Hence, the Government's motion for summary judgment against the Subten- ants is still pending with respect to Softer only. DISCUSSION A. Standards for Summary Judgment The standards applicable to motions for summary judgment are well-settled. A court may grant summary judgment only where there is no genuine issue of material fact and the moving party is therefore entitled to judgment as a matter of law. See Fed. R.Civ.P. 56(c). Accordingly, the court's task is not to "weigh the evidence and determine the truth of the matter but to determine whether thre is a genuine issue for trial." I Anderson Liberty Lobby, Inc, 477 U.S. 242, 249, 106 S.Ct. 2605, 91 L.Ed.2d 202 (1986). Summary judgment is inappropriate if, resolving all ambiguities and drawing all inferences against the moving party,id. at 255, 106 S.Ct. 2505 (citing Adickes I S.H. Kress & Ca, 398 U.S. 144, 158-59, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970)), there exists a dispute about a material fact "such that a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248 106 S.Ct. 2606. Once the moving party meets its initial burden of production, the burden shifts to the nonmoving party to demonstrate that there exist genuine issues I material fact. Matsushita Elec. Indus. Ca Zenith Radio Corp., 476 U.S. 574, 585-86, 106 S.Ct. 1348, 89 L.Ed2d 638 (1986). To defeat a motion for summary judgment, however, the non- moving party "must do more than simply show that there is some metaphysical doubt as to the material facts." Id. at 586, 106 S.Ct. 1348. There is no issue for trial unless there exists sufficient evidence in the record favoring the party opposing summary judg- ment to support a jury verdict in that party's EFTA00187396 410 27 FEDERAL SUPPLEMENT, 2d SERIES favor. Anderson, 477 U.S. at 249, 106 S.Ct. 2506. As the Supreme Court stated in Anderson, "If the evidence is merely color- able, or is not significantly probative, sum- mary judgment may be granted." Id at 249-50, 106 S.CL 2506 (citations omitted). With these standards in mind, I turn to the Government's motions for partial summary judgment. B. The Government's Motion for Partial Summary Judgment against Epstein and Fisher 1. Whether the Lease Permitted Oral Consent to a Proposed Sublet or As- signment Epstein and Fisher contend that summary judgment should be denied because there exists a genuine issue of material fact as to whether OFM orally consented to Epstein's request to sublet the Premises to Fisher. The Government, on the other hand, argues that the lease unambiguously required that a sublet or assignment of the Premises be ap- proved in advance in writing, and that, there- fore, even if OFM did orally consent, such consent was invalid as a matter of law. 11-31 In contract disputes, the Court be- gins by examining the language of the con- tract itself to determine the parties' intent. Stroll I Epstein 818 F.Supp. 640, 643 (S.D.N.Y.), affd, 9 FM 1637 (2d Cir.1993). If the agreement sets forth the parties' in- tent clearly and unambiguously, the Court need look no further. See Sterling Drug Inc. Bayer AG, 792 F.Supp. 1357, 1366-66 (S.D.N.Y.1992), red in part, remanded in part, 14 F.3d 738 (2d Cir.1994). Whether the text of an agreement is ambiguous or unam- biguous is a matter of law to be decided by the Court. Sterling Drug, 792 F.Supp. at 1366. A contract is not deemed ambiguous unless it is reasonably susceptible of more than one interpretation, and the Court makes this determination by reference to the con- tract alone. Banque Ambe et Internationale D'Investissement I. Maryland Nat'l Bank, 67 F.3d 146, 162 (2d Cir.1995). 141 The lease clearly provides that Ep- stein was required to obtain the advance written consent of OFM to sublet the Prem- ises to Fisher. The Assignment and Sublet Clause expressly states that "Tenant may sublet all or part of the Premises, or assign this lease or permit any other person to use the Premises with the advance written per- mission of Landlord" (Massey Decl., Exh. B at 4) (emphasis added). Epstein's and Fisher's argument that the word "may" sug- gests that OFM could approve a sublease or assignment in writing or orally is tortured. Only one interpretation of this clause is tena- ble: prior written consent of OFM was re- quired for a sublet. Epstein's and Fisher's argument would render the language of the clause meaningless, and I am obliged to read the lease in a manner that gives full force and effect to all clauses contained therein. See Lloyds Bank PIC Republic of Ecua- dor, No. 96 Civ. 1789 ( ), 1998 WL 118170, at •8 (S.D.N.Y. Mar. 16, 1998). Accordingly, OFM could not have orally consented to Ep- stein's proposed sublet to Fisher, as a matter of law, and, therefore, I need not reach the question of whether OFM actually gave oral consent. 2. Whether the Lease Permitted OFM to Unreasonably Withhold Written Consent to a Proposed Sublet The last issue to be decided on this motion is whether OFM was entitled to refuse Ep- stein's proposed sublet to Fisher arbitrarily, or whether it breached a duty of good faith and fair dealing implicit in the lease agree- ment by unreasonably refusing to grant such consent in writing. Resolution of this issue turns on whether federal contract law or New York landlord-tenant law applies. [51 Generally, under New York law, where a lease requires a tenant to obtain the prior written consent of the landlord to sub- let or assign leased premises, a landlord may refuse consent arbitrarily, unless the lease contains a clause specifically stating that the landlord may not unreasonably withhold such consent See Dress Shirt Sales, Inc., Hotel Martinique Assocs., 12 N.Y2d 339, 239 N.Y.S.2d 660, 662, 190 N.E2d 10 (Ct.App. 1963). The Assignment and Sublet Clause in the lease between OFM and Epstein re- quired Epstein to obtain prior written con- sent of OFM to a proposed sublet, but it EFTA00187397 U.S. EPSTEIN 411 ch.. 27 F.Suppld 404 (5.D.N.Y. 1991) contained no provision prohibiting OFM from of landlord and tenant. Powers t United unreasonably withholding such written con- sent. The Government, relying on New York landlord-tenant law, asserts that it was enti- tled to withhold its consent to Epstein's pro- posed sublet to Fisher for any reason, or for no reason at all. Epstein and Fisher, howev- er, disagree. They contend that, because the Government is a party to the lease, interpre- tation of the lease is governed by principles of federal common law, not New York State law. Pursuant to federal common law of con- tracts, Epstein and Fisher continue, the lease between OFM and Epstein contains an im- plied covenant of good faith and fair dealing, citing Neal & Co. t! United States, 36 Fed. Cl. 600 (1996), re 121 F.3d 683 (Fed.Cir. 1997). The requirement of good faith and fair dealing, they argue, prohibits OFM from withholding consent unreasonably. OFM's refusal to consent to Epstein's proposed sub- let of the Premises to Fisher, they contend, was motivated by its desire to enter into a lease with Galinas at a higher rent beginning February 1, 1997. Such conduct was unrea- sonable, they argue, and, therefore, OFM breached the implied covenant of good faith and fair dealing in the lease. (6,7) I conclude that New York landlord- tenant law rather than general federal con- tract principles should apply. As a threshold matter, although I agree as a policy matter that federal law should apply, there is no federal statutory or common law governing landlord-tenant relations. Federal law should apply because the United States is a party. I have jurisdiction over this action based on 28 U.S.C. § 1345 and the FMA 22 U.S.C. § 4301 et seq. The subject matter of this action is a landlord-tenant dispute, how- ever, and while application of federal law is appropriate in federal question cases where applicable federal substantive law exists, there is no federal statutory or common law 4. In United Stales! Bedford Associates, 657 Ii.2d 1300 (2d Cir.1981 , cert. denied, 456 U.S. 914. 102 S.Ct. 1767, 72 L.Ed.2d 173 (1982). the Sec. and Circuit upheld the district court's applies• tion of federal contract law to determine whether the United States and a potential lessor of a commercial building had in fact made a contract, stating that "tilhis court undoubtedly has power Skates Postal Seru, 671 F.2d 1041, f042, 1046 (7th Cir.1982); Reed United States Postal Sera., 660 F.Supp. 178, 181 (D.Mass-1987). The question remains, therefore, what law applies in the absence of a federal rule on point. As the Supreme Court has made clear, my power to create federal common law in the absence of federal landlord-tenant law is lim- ited. Several recent Supreme Court deci- sions have reaffirmed the principle that the power of the federal courts to fashion princi- ples of federal common law is limited. See, e.g., O'Melveny & Myers FDIC, 512 U.S. 79, 87-88, 114 S.Ct. 20487 129 L.Ed.2d 67 (1994) (noting that cases where the formula- tion of a "special federal rule" are "few and restricted"); Kamen I Kemper Fin. Servs., Inc., 500 U.S. 90, sir, 111 S.Ct. 1711, 114 L.Ed.2d 152 (1991) (noting that a federal court "should endeavor to fdl the interstices of federal remedial schemes with uniform federal rules only when the scheme in ques- tion evidences a distinct need for nationwide legal standards or when express provisions in analogous statutory schemes embody con- gressional policy choices readily applicable to the matter at hand") (citations omitted). While this recent Supreme Court authority leaves room for federal courts to create prin- ciples of federal common law in certain nar- row circumstances, generally a "significant conflict between some federal policy or inter- est and the use of state law" is required before "judicial creation of a special federal rule (is) justified." O'Melveny, 512 U.S. at 87, 114 S.Ct. 2048. While few courts have addressed the precise issue of whether leases to which the Government is a party are governed by general federal common law of contracts or state landlord-tenant law, there is some case law on point. The Second Cir- cuit has not yet spoken definitively on this issue,4 but recently noted the existence of a to apply federal law in disputes between the United States and its lessors?' Id. at 1309 n. 7. The court in Kerin I. United States Postal Sera., 116 F.3d 988 (2d ir.1997), acknowledged the Bedford Associates decision, but implied that Bed. ford Associates involved the issue of creation of a lease only, stating that there is "room for fair debate" as to whether federal or state law ap. EFTA00187398 412 27 FEDERAL SUPPLEMENT, 2d SERIES conflict between the Federal Circuit and the Seventh Circuit concerning "whether federal common law or state law applies to the inter- pretation of Postal Service Leases?' Kerin United States Postal Sera, 116 F2d 988, 990 (2d Cir.1997). On the one hand, the Federal Circuit has held that federal law applies to resolve disputes between the Unit- ed States and its lessors or tenants. See. e.g., Forman I United States, 767 F.2d 875, 879-80 (Fed. ir.1985); 6 Kelley United State* 19 CI.Ct. 155, 162 (1989). On the other hand, the Seventh Circuit has held that state substantive law governs in landlord- tenant disputes involving the Government. See Powers United States Postal Sett, 671 F.2d 1041,1043-46 (7th Cir.1982).. The Second Circuit in Kerin did not reach the issue of whether federal common law or state law applied because, in that case, feder- al law and state law led to the same result. See Kerin, 116 F.3d at 991. I agree with the Seventh Circuit's conclusion, for two reasons. First, although Epstein and Fisher argue that a federal rule should be created to pro- mote the creation of a uniform body of law in landlord-tenant disputes involving the Gov- ernment, there is no "distinct need" for a nationwide legal standard or a uniform na- tional rule. See Kamen, 500 U.S. at 98 Ill S.Ct, 1711. Landlord-tenant law traditional- ly has been a matter of state law. There is no compelling reason to disrupt expectations that tenants and landlords may have under state law merely because they are entering into a lease with the federal government. Courts have long held that, "[albsent control- ling federal legislation or rule of law, ques- tions involving real property rights are de- plies to the interpretation of a lease to which the Government is a party. Id. at 990-91. 5. While the Forman court stated that federal law governs in landlord-tenant disputes involving the Government, it nevertheless relied on state law cases in interpreting the particular provision of the Postal Service lease at issue. See 767 P.M at 88041. 6. Other courts, too, have applied state substan- tive law as the rule of decision In landlord-tenant disputes involving the Government. See, e.g., Braxton'. United States, 858 F.2d 650. 655 (11th Cir.19881 (holding that Florida law applies to determine whether one who occupies land for- termined under state law, even when the United States is a party." United States 1 O'Block, 788 F.2d 1423, 1435 (10th Cir.198M (citing Oregon ex rel. State Land lid Corvallis Sand & Gravel Co., 429 U.S. 363, 378-81, 97 S.Ct. 582, 60 L.Ed.2d 650 (1977)).7 Second, application of state substantive law directly on point is eminently more logi- cal than application of general principles of federal contract law. While application of general federal contract law to Government contracts may be appropriate in certain in- stances, where, as here, the particular gov- ernment contract is a lease for the use of real property, the adoption of state common law of landlord-tenant relations, a body of law that has developed precisely to address the rights and duties of individuals in the unique relationship of landlord and tenant, makes sense. Application of the state rule, which permits a landlord to refuse consent to a sublet or assignment arbitrarily in the ab- sence of a clause to the contrary, better serves the interests of the Government as a landlord because it permits the Government to have unfettered discretion in deciding who occupies its property. Given the sensitive political considerations that often come into play when governmental property, such as the property here in issue owned by Iran, is involved, the Government should have as much discretion as possible. Noting that federal landlord-tenant law does not exist, Judge Posner stated in Pow- The Federal Courts could of course create that law, picking and choosing among ex- isting state laws and proposed reforms in accordance with the recommendations of kited by the Government must pay the Govern- ment a reasonable rent for the period of his occupancy); Reed. 660 F.Supp. at 181 (holding that Massachusetts law governs the rights of the parties under a Postal Service lease). 7. Indeed, the Supreme Court has articulated that the normal federal disposition where no substan- tive federal provision Is relevant to the legal issue at hand is for "federal courts [to) 'Incorporatk) [state law] as the federal rule of decision.'" Kamen, 500 U.S. at 98, III S.Ct. 1711 (emphasis added) (quoting United States I. Kimbell Foods, Inc., 440 U.S. 715, 728, 99- S.M. 1448, 59 L.Ed.2d 711 (1979)). EFTA00187399 U.S. ■ EPSTEIN 413 CIO: as 27 F.Survad 404 (S.D.N.Y. 1998) eminent scholars and practitioners. It is not to be expected that the federal courts would do a very good job of devising a model code of landlord-tenant law, since they have very little experience in land- lord-tenant matters; and though eventual- ly some body of law would emerge it would not in all likelihood be a uniform body, because there are [thirteen] federal cir- cuits and the Supreme Court could be expected to intervene only sporadically • • (Vie do not have to balance compet- ing federal and state interests in this case after all. The overriding federal interest here is in certainty of right and obligation flowing from conformity to known law; the state interest is in offering its landlords a like certainty. These interests converge in favor of adopting . .. state law rather than federal common law. Powers, 671 F.2d at 1045-46. This reasoning is quite convincing, particularly in a case such as this, where the Government and Epstein, in all likelihood, "entered [a) legal relationship with the expectation that their rights and obligations would be governed by state-law standards." Kamen, 600 U.S. at 98, 111 S.Ct. 1711. Finally, Er Win's and Fisher's reliance on Neal & Ca United States, 36 Fed. Cl. 600 (1996), alrd 121 F.3d 683 (Fed.Cir.1997), is therefore misplaced. There, the United States Court of Federal Claims stated that lelvery contract, including those in which the Government is a party, contains an im- plied covenant of good faith and fair dealing," id at 631, and from this statement, Epstein and Fisher extrapolate that there exists an implied covenant of good faith and fair deal- ing in the lease agreement between Epstein and the Government at issue here. The facts of Neal & Co. are distinguish- able, however. Neal & Co. involved a con- struction contract to build a housing project entered into between the Government and a contractor, not a lease for occupancy of real property. While a lease is a type of contract, the considerations surrounding a lease of real property are sufficiently different from those involved in a conventional contract as to mili- tate against the extension of Neal & Co. and like cases to landlord-tenant disputes. A construction contract does not implicate the Government's rights, as a possessor of a valuable leasehold, to regulate the possession and use of real property under its control. Thus, as between general federal contract principles and specific state landlord-tenant law, the latter should be applied. Land is unique. It is logical, therefore, that a land- lord should have virtually complete say in who occupies its property. See Mann The- atres Corp. I Mid-Island Shopping Plaza Ca, 94 A.D.2d 466, 464 N.Y.S.2d 793, 798 (2d Dep't 1983) (noting that landlords have a "substantial interest in controlling the as- signability of leases"), eV, 62 N.Y.2d 930, 479 N.Y.S.2d 213, 468 N.E2cl 51 (CLApp. 1984). It makes sense for the law to permit a landlord to unreasonably withhold consent to a proposed sublet unless the parties spe- cifically bargain otherwise. See Alex M. Johnson, Jr., Correctly Interpreting Long- Term Leases Pursuant to Modern Contract Law: Toward a Theory of Relational Leases, 74 Va. L.Rev. 751, 758 (1988) (discussing the majority view that absent contractual agree- ment to the contrary landlords are permitted to unreasonably withhold consent to a sublet or assignment, and noting that the rule stems from the "paramount importance of the lessor's ability to control the selection of his tenants so as to protect the value of his reversionary interest" in the leasehold). [SI I therefore adopt the relevant rule of New York landlord-tenant law for purposes of deciding the remaining issue in this dis- pute, and hold that, consistent with New York law, OFM was entitled to arbitrarily withhold its consent to Epstein's request to sublet the Premises to Fisher. Even assum- ing OFM had a hidden agenda in refusing Epstein's request to sublet to Fisher, specifi- cally, that it preferred to enter into a new lease with Galinas at a higher rental price, it was, entitled to withhold its consent to a sublet for a good reason, a bad reason, or no reason at all. There existed no implied cove- nant of good faith and fair dealing in its lease with Epstein requiring OFM to act reason- ably in deciding whether to approve Ep- stein's proposed sublet, and, therefore, OFM cannot be held liable for a breach thereof. EFTA00187400 414 27 FEDERAL SUPPLEMENT, 2d SERIES • Thus, I need not reach the issue of whether OFM in fact unreasonably withheld consent. And, as Fisher was occupying the Premises pursuant to an illegal sublet, OFM was with- in its rights to terminate Epstein's lease. Accordingly, the Government's motion for partial summary judgment on its claim for ejectment of Epstein and Fisher from the Premises is hereby granted. C. The Government's Motion for Partial Summary Judgment Against the Sub- tenants Eleven of the twelve Subtenants signed a stipulation agreeing to be bound by the Court's decision on the Government's claim for ejectment against Epstein and Fisher. I now grant the Government's motion for par- tial summary judgment against Epstein and Fisher; hence, the motion is also granted with respect to these eleven Subtenants. The remaining Subtenant, Ron Softer, did not sign the stipulation. He has not respond- ed to the Government's motion because the motion is not returnable until April 20, 1998. Softer, however, can have no greater rights than Fisher. Hence, the Government's mo- tion is granted as to Softer as well. Of course, if Soifer believes he has some basis for arguing that he has greater rights than Fisher has, he may make a motion for recon- sideration within ten days hereof. CONCLUSION For the foregoing reasons, the Govern- ment's motion for summary judgment on its claim for ejectment is granted as to Epstein, Fisher, and all of the Subtenants. SO ORDERED. UNION CARBIDE CORPORATION, indi• vidually and on behalf of and as the suc- cessor in interest of Seadrift Polypropy- lene Company, Plaintiff, I MONTELL Montell Polyolefins; Montell North America Incorporated; Montell USA Incorporated; Technipol S.r.l.; Montedison SpA.; Montell Fi- nance USA, Inc.; Royal Dutch Petrole- um Company, p.l.c.; The Shell Transport and Tradi ompany, p.l.c.; Shell Pe- troleum ; The Shell Petroleum Company Limited; Shell Petroleum Inc.; Shell Oil Company; Shell Polypro- pylene Company; Shell Canada Limited; Shell International Chemical Company Limited; and Shell Iglanationale Re- search Maatschappij M, Defendants. No. 95 Civ. 0134(SAS). United States District Court, S.D. New York. Aug. 4, 1998. Producer of polypropylene resin brought antitrust action against alleged conspirators, arising out of one conspirator's termination of negotiation to construct new resin manu- facturing plants. Following settlement with one alleged conspirator, remaining conspira- tor moved for summary judgment. The Dis- trict Court, Scheindlin, J., held that: (1) there was fact issue whether conspiracy existed to limit trade in resin; (2) termination was ancil- lary restraint of trade, precluding determina- tion that it was per se violation of Sherman Act § 1; and (3) there was no unreasonable restraint of trade, under rule of reason stan- dard. Summary judgment granted in part 1. Federal Civil Procedure o=2484 Due to the potential chilling effect of prolonged antitrust litigation on competition, parties that forward economically implausible antitrust claims must come forward with more persuasive evidence to support them EFTA00187401 Page I of 2 VVestiaw. Page 1 Maria Tankenson Hodge Current Firm Information Unknown hodgfranOislands.vi Position: Member Education: University of California at Berkeley, Boalt Hall School of Law, Berkeley, CA, J.D., Doctor of Jurisprudence University of California, Santa Cruz, California, 1989 B.A.Govt., Bachelor of Arts in Government Admitted: 1971 California, 1972 Virgin Islands, 1974 U.S. Court of Appeals 3rd Circuit U.S. Supreme Court, 1983 Affiliations: The West Indian Company, Limited, Director, 1989 - Present Representative Clients: Public Services Commission The West Indian Company, Limited Virgin Islands Port Authority References: Chase Manhattan Bank, N.A., St. Thomas, Virgin Islands Kodak Corporation, Hato Rey, Puerto Rico Prudential Securities, St. Thomas, Virgin Islands West Practice Categories: Estate Planning Family Law Litigation & Appeals Real Estate Law Land Use & Zoning 2007 Thomson/west. No Claim to Orig. U.S. Govt. Works. https://web2.westlaw.com/print/printstream.aspx?prft=HTMLE&destination=atp&sv=Full... 5/22/2007 EFTA00187402 Page 2 of 2 Page 2 Areas of Practice: General Civil Litigation Appellate Practice Real Estate Civil Practice END OP DOCUMENT 2007 Thomson/West. No Claim to Orig. U.S. Govt. Works. https://web2.westlaw.com/print/printstream.aspx?prft=HTMLE&destination=atp&sv—Full... 5/22/2007 EFTA00187403 Entity Information Page 1 of 1 NYS Department of State Division of Corporations Entity Information Selected Entity Name: J. EPSTEIN & COMPANY, INC. Selected Entity Status Information Current Entity Name: J. EPSTEIN & COMPANY, INC. Initial DOS Filing Date: NOVEMBER 18, 1988 County: NEW YORK Jurisdiction: NEW YORK Entity Type: DOMESTIC BUSINESS CORPORATION Current Entity Status: INACTIVE Selected Entity Address Information DOS Process (Address to which DOS will mail process if accepted on behalf of the entity) GOLD & WACHTEL, ESQS 10 EAST 53RD STREET NEW YORK, NEW YORK, 10022 Registered Agent NONE NOTE: New York State does not issue organizational identification numbers. Search Results New Search Division of Corporations. State Records and UCC Home Page NYS Department of State Home Page http://appsext8.dos.state.ny.us/corp_public/CORPSEARCH.ENTITYJNFORMATION?p nameid=1423231&p_corpid=13073... 5/14/2007 EFTA00187404 Entity Information Page 1 of 1 NYS Department of State Division of Corporations Entity Information Selected Entity Name: JEFFREY E. EPSTEIN, INC. Selected Entity Status Information Current Entity Name: J. EPSTEIN & COMPANY, INC. Initial DOS Filing Date: NOVEMBER 18, 1988 County: NEW YORK Jurisdiction: NEW YORK Entity Type: DOMESTIC BUSINESS CORPORATION Current Entity Status: INACTIVE Selected Entity Address Information DOS Process (Address to which DOS will mail process if accepted on behalf of the entity) GOLD & WACHTEL, ESQS 10 EAST 53RD STREET NEW YORK, NEW YORK, 10022 Registered Agent NONE NOTE: New York State does not issue organizational identification numbers. Search Results New Search Division of Corporations, State Records and UCC Home Page NYS Department of State Home Page http://appsezt8.dos.state.ny.us/corp_public/CORPSEARCH.ENTITY INFORMATION?p_nameid=1423230&p_corpid=13073... 5/14/2007 EFTA00187405 United States District Court Eastern District of Pennsylvania - Docket Report Page 1 of 7 CLOSED, STANDARD United States District Court Eastern District of Pennsylvania (Philadelphia) CIVIL DOCKET FOR CASE #: 2:02-cv-07671-CN SHANKS'. WEXNER et al Date Filed: 10/02/2002 Assigned to: HONORABLE CLARENCE C. NEWCOMER Date Terminated: 10/21/2003 Cause: 28:1332 Diversity-Breach of Contract Jury Demand: None Nature of Suit 195 Contract Product Liability Jurisdiction: Diversity Plaintiff NELSON SHANKS represented by JEFFREY D. HOFFERMAN GOLLATZ GRIFFIN & EWING PC 4 PENN CENTER PLAZA SUITE 200 1600 JOHN FITZGERALD KENNEDY BOULEVARD PHILADELPHIA, PA 19103-2813 215-563-9400 Fax: 215-665-9988 Email: jhofferman®ggelaw.com LEAD ATTORNEY ATTORNEY TO BE NOTICED I Defendant LESLIE WEXNER represented by CHRISTOPHER J. GUITON DRINKER BIDDLE & REATH ONE LOGAN SQ 18TH & CHERRY STS PHILA, PA 19103 215-988-2546 LEAD ATTORNEY ATTORNEY TO BE NOTICED J. FOX DRINKER BIDDLE & REATH LLP ONE LOGAN SQ 18TH & CHERRY STS PHILA, PA 19106-6996 215-988-2714 Fax: 215-988-2757 Email: [email protected] LEAD ATTORNEY https://ecfpaed.uscourts.gov/cgi-bin/DictRpt.p19.261521028494284-L_353_0-1 5/22/2007 EFTA00187406 • United States District Court Eastern District of Pennsylvania - Docket Report Page 2 of 7 Defendant ABIGAIL WEXNER H/W Defendant JEFFREY E. EPSTEIN INDIVIDUALLY doing business as J. EPSTEIN AND COMPANY, INC. Defendant GHISLAINE MAXWELL ATTORNEY TO BE NOTICED represented by CHRISTOPHER J. GUITON (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED J. FOX (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED represented by CHRISTOPHER J. GUITON (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED J. FOX (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED represented by CHRISTOPHER J. GUITON (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED J. FOX (See above for address) LEAD ATTORNEY ATTORNEY TO BE NOTICED Date Filed # Docket Text 10/02/2002 1 COMPLAINT against JEFFREY E. EPSTEIN, GHISLAINE MAXWELL, ABIGAIL WEXNER, LESLIE WEXNER ( Filing fee $ 150 receipt number 803892.), filed by NELSON SHANICS.(ti, ) Additional attachment(s) added on 2/13/2003 (1db, ). (Entered: 10/03/2002) 10/02/2002 Summons Issued as to JEFFREY E. EPSTEIN, GHISLAINE MAXWELL, ABIGAIL WEXNER, LESLIE WEXNER.Four Forwarded To: Counsel on 10/3/02 (ti, ) (Entered: 10/03/2002) 12/16/2002 2 ORDER THAT JEFFREY E. EPSTEIN ; GHISLAINE MAXWELL ; ABIGAIL WEXNER ; LESLIE WEXNER HAVE UNTIL 12/31/02 TO ANSWER, MOVE, OR OTHERWISE PLEAD TO THE COMPLAINT; https://ecf.paed.uscourts.gov/cgi-bin/DktRpt.p17261521028494284-L_353_0-1 5/22/2007 EFTA00187407 United States District Court Eastern District of Pennsylvania - Docket Report Page 3 of 7 J. FOX WILL ACCEPT SERVICE ON BEHALF OF ALL DEFENDANTS ETC. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 12/16/02. 12/17/02 ENTERED AND COPIES MAILED (ph, ) (Entered: 12/17/2002) 12/30/2002 3 MOTION FOR DISMISSAL PURSUANT TO FRCP 12(b)(2), MEMORANDUM, CERTIFICATE OF SERVICE FILED BY EPSTEIN, GHISLAINE MAXWELL, ABIGAIL WEXNER, LESLIE WEXNER..(ph, ) Additional attachment(s) added on 2/13/2003 (ldb, ). (Entered: 12J31/2002) 01/15/2003 4 STIPULATION & ORDER THAT PLAINTIFF SHALL HAVE UNTIL 1/31/03 TO FILE A RESPONSE TO DEFENDANTS MOTION TO DISMISS. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 1/15/03. 1/15/03 ENTERED AND COPIES MAILED.(rv, ) (Entered: 01/15/2003) 02/07/2003 5 STIPULATION AND ORDER THAT PLAINTIFF SHALL HAVE UNTIL 2/14/03 TO FILE A RESPONSE TO DEFENDANT'S MOTION TO DISMISS FILED IN THIS MATTER ON 12/30/02. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 2/7/03.2/10/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 02/10/2003) 02/14/2003 6 REPLY filed by NELSON SHANKS to Defendant's Motion to Dismiss pursuant to F.R.C.P. 12(b)(2), Certificate of Service. (rv, ) (Entered: 02/18/2003) 02/27/2003 7 REPLY to Plaintiffs Response to Defendants' Motion to Dismiss filed by JEFFREY E. EPSTEIN, GHISLAINE MAXWELL, ABIGAIL WEXNER, LESLIE WEXNER, Certificate of Service. (ar, ) (Entered: 02/28/2003) 03/18/2003 8 OPINION AND ORDER DENYING DEFENDANTS' MOTION FOR DISMISSAL. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 3/18/03.3/19/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 03/19/2003) 04/07/2003 9 STIPULATION AND ORDER THAT JEFFREY E. EPSTEIN, GHISLAINE MAXWELL,ABIGAIL WEXNER, LESLIE WEXNER'S ANSWER IS EXTENDED TO 4/18/03. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 4/7/03.4/8/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 04/08/2003) 04/24/2003 10 STIPULATION AND ORDER THAT ABIGAIL WEXNER AND LESLIE WEXNER'S ANSWER IS DUE 4/30/03. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 4/24/03.4/25/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 04/25/2003) 04/30/2003 II ANSWER, affirmative defenses to Complaint by JEFFREY E. EPSTEIN, GHISLAINE MAXWELL, ABIGAIL WEXNER, LESLIE WEXNER, Certificate of service.(ph, ) Additional attachments) added on 5/16/2003 (ph, ). (Entered: 05/01/2003) https://ecf.paed.uscourts.gov/cgi-bin/DktRpt.pl?261521028494284-L 353_0-1 5/22/2007 EFTA00187408 • United States District Court Eastern District of Pennsylvania - Docket Report Page 4 of 7 04/30/2003 Issue Joined (ph, ) (Entered: 05/01/2003) 05/05/2003 12 NOTICE of Hearing: Pretrial Conference set for 5/13/2003 03:15 PM in Judge's Chambers, Room 13614 (13th Floor) before HONORABLE CLARENCE C. NEWCOMER. (mf) (Entered: 05/05/2003) 05/19/2003 13 STIPULATION AND ORDER THAT PLAINTIFF SHALL HAVE UNTIL 5/30/03 TO RESPOND TO DEFENDANTS' ANSWER AND COUNTERCLAIMS FILED ON 4/30/03. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 5/19/03.5/19/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 05/19/2003) 05/22/2003 14 ORDER THAT DISCOVERY IS DUE 8/13/03; DISPOSITIVE MOTIONS BY 8/13/03; RESPONSES TO DISPOSITIVE MOTIONS BY 8/25/03; FINAL PRETRIAUSETTLEMENT CONFERENCE BY 9/24/03 AT 11:15 A.M.; PRETRIAL MEMORANDA BY 9/17/03; COUNSEL SHALL BE PREPARED FOR TRIAL BY 9/23/03. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 5/22/03.5/22/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 05/22/2003) 05/29/2003 15 MOTION TO DISMISS COUNTERCLAIM FOR FAILURE TO STATE A CLAIM UPON WHICH RELIEF CAN BE GRANTED, MEMORANDUM, CERTIFICATE OF SERVICE FILED BY NELSON SHANKS.(ph, ) Modified on 5/29/2003 (ph, ). Additional attachments) added on 6/16/2003 (vw, ). Additional attachment(s) added on 6/16/2003 (vw, ). Additional attachment(s) added on 6/16/2003 (vw, ). Additional attachment(s) added on 6/16/2003 (vw, ). (Entered: 05/29/2003) 06/19/2003 16 STIPULATION AND ORDER THAT THE TIME IN WHICH THE DEFENDANTS MUST SUBMIT A REPLY TO PLAINTIFFS MOTION TO DISMISS COUNT II OF DEFENDANTS' COUNTERCLAIM, IS EXTENDED UNTIL AND INCLUDING 6/30/03 . SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 6/19/03. 6/19/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 06/19/2003) 07/08/2003 17 STIPULATION AND ORDER THAT DEFENDANTS MUST SUBMIT A REPLY TO PLAINTIFF'S MOTION TO DISMISS COUNT II OF DEFENDANTS' COUNTERCLAIM BY 7/14/03 ETC . SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 7/8/03.7/9/03 ENTERED AND COPIES MAILED AND FAXED 7/8/03(ph, ) Additional attachments) added on 7/9/2003 (Idb, ). (Entered: 07/09/2003) 07/14/2003 a Reply to plaintiff's motion to dismiss pursuant to FRCP 12(b)(6), Certificate of service filed by ABIGAIL WEXNER, LESLIE WEXNER. (ph, ) Additional attachment(s) added on 7/17/2003 (ph, ). (Entered: 07/15/2003) 07/18/2003 19 Response to defendants' reply to motion to dismiss counterclaim for failure to state a claim upon which relief can be granted, Certificate of service filed by NELSON SHANKS. (ph, ) (Entered: 07/21/2003) 08/13/2003 24 MOTION FOR JUDGMENT ON THE PLEADINGS AGAINST https://ecf.paed.uscourts.gov/cgi-bin/DktRpt.pl?261521028494284-L_353_0-1 5/22/2007 EFTA00187409 United States District Court Eastern District of Pennsylvania - Docket Report Page 5 of 7 JEFFREY EPSTEIN WITH RESPECT TO COUNT I OF THE COMPLAINT (BREACH OF CONTRACT), CERTIFICATE OF SERVICE FILED BY NELSON SHANKS..(ph, ) (Entered: 08/13/2003) 08/21/2003 21 ORDER THAT UPON CONSIDERATION OF PLAINTIFF'S MOTION TO DISMISS AND DEFENDANTS' RESPONSE, IT IS ORDERED THAT SAID MOTION IS DENIED ETC.. SIGNED BY JUDGE JAMES R. MELINSON ON 8/21/03.8/22/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 08/22/2003) 08/26/2003 22 PLAINTIFFS MOTION TO COMPEL FILED BY NELSON SHANICS,CERTIFICATE OF COUNSEL, CERTIFICATE OF SERVICE.(ar, ) (Entered: 08/26/2003) 08/26/2003 22 ANSWER AND AFFIRMATIVE DEFENSES OF PLAINTIFF TO COUNTERCLAIMS OF DEFENDANTS LESLIE AND ABIGAIL WEXNER BY NELSON SHANKS, CERTIFICATE OF SERVICE.(ar, ) (Entered: 08/26/2003) 08/26/2003 24 Supplement to Plaintiffs Motion for Judgment on the Pleadings Against Defendant Jeffrey Epstein with Respect to Count I of Plaintiffs Complaint (Breach of Contract) filed by NELSON SHANKS, Certificate of Service. (ar, ) (Entered: 08/26/2003) 08/27/2003 25 Memorandum in opposition to plaintiffs motion for judgment on the pleadings as to count one - breach of contract, Certificate of service filed by JEFFREY E. EPSTEIN. (ph, ) Additional attachment(s) added on 9/4/2003 (ph, ). (Entered: 08/28/2003) 08/28/2003 2¢ Reply to EPSTEIN'S memorandum in opposition to plaintiffs motion for judgment on the pleadings, Certificate of service by NELSON SHANKS. (ph, ) (Entered: 08/29/2003) 08/28/2003 27 MOTION TO STRIKE DEFENDANT'S MEMORANDUM IN OPPOSITION FOR VIOLATION OF COURT ORDER, CERTIFICATE OF SERVICE filed by NELSON SHANKS. (SEE #26).(ph, ) (Entered: 08/29/2003) 09/04/2003 28 ORDER DENYING PLAINTIFFS MOTION FOR JUDGMENT ON THE PLEADINGS WITH RESPECT TO COUNT I, THE COURT FINDS THAT THERE ARE FACTUAL ISSUES IN THIS CASE AS TO WHETHER A CONTRACT WAS FORMED BETWEEN THE PARTIES AND THE TERMS OF ANY SUCH CONTRACT.. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 9/4/03.9/4/03 ENTERED AND COPIES MAILED AND FAXED. (ph, ) (Entered: 09/04/2003) 09/05/2003 29 RESPONSE to plaintiff NELSON SHANKS' motion to compel, Certificate of service filed by JEFFREY E. EPSTEIN, GHISLAINE MAXWELL, ABIGAIL WEXNER, LESLIE WEXNER. (ph, ) (Entered: 09/08/2003) 09/05/2003 3S) MOTION FOR PROTECTIVE ORDER TO QUASH NOTICE OF https://ecf.paed.uscourts.gov/cgi-bin/DktRpt.p17261521028494284-L_353_0-1 5/22/2007 EFTA00187410 United States District Court Eastern District of Pennsylvania - Docket Report Page 6 of 7 DEPOSITIONS, MEMORANDUM, CERTIFICATION OF COUNSEL, CERTIFICATE OF SERVICE filed by JEFFREY E. EPSTEIN, GHISLAINE MAXWELL, ABIGAIL WEXNER, LESLIE WEXNER.. (ph, ) Additional attachments) added on 10/1/2003 (ph, ). Additional attachment(s) added on 10/10/2003 (ph, ). (Entered: 09/08/2003) 09/09/2003 31 ORDER MOOTING PLAINTIFFS' MOTION TO COMPEL THE PRODUCTION OF DOCUMENTS AND RESPONSES TO INTERROGATORIES ETC.. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 9/9/03.9/10/03 ENTERED AND COPIES MAILED AND FAXED 9/9/03(ph, ) (Entered: 09/10/2003) 09/10/2003 32 Reply to defendants' motion for a protective order to quash notice of depositions and supplemental memorandum of law in connection with plaintiff's motion to compel discovery responses, Certification of counsel, Certificate of service filed by NELSON SHANKS. (ph, ) Additional attachment(s) added on 9/18/2003 (fh, ). (Entered: 09/11/2003) 09/18/2003 3 ORDER DENYING AS MOOT DEFENDANTS MOTION TO QUASH NOTICE OF DEPOSITIONS, UPON REPRESENTATION THAT THE PARTIES HAVE AGREED UPON THE LOCATIONS OF THE NOTICED DEPOSITIONS ETC.. SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 9/18/03.9/18/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 09/18/2003) 09/23/2003 34 ORDER THAT THE COURTS PRETRIAL SCHEDULING ORDER IS AMENDED AS FOLLOWS: DISCOVERY BY 10/10/03, SETTLEMENT/FINAL PRETRIAL CONFERENCE ON 10/20/03 AT 11:15; PRETRIAL MEMORANDA AND JOINT PROPOSED JURY INSTRUCTIONS 10/15/03; COUNSEL SHALL BE PREPARED FOR TRIAL ON 10/20/03 . SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 9/23/03.9/24/03 ENTERED AND COPIES MAILED (ph, ) (Entered: 09/24/2003) 09/23/2003 SETTLEMENT CONFERENCE SET FOR 10/20/2003 11:15 AM BEFORE HONORABLE CLARENCE C. NEWCOMER. (ph, ) (Entered: 09/24/2003) 10/21/2003 35 STIPULATION AND ORDER THAT THE COURT DISMISS THE CAPTIONED MATTER, INCLUDING ALL CLAIMS AND COUNTERCLAIMS, WITH PREJUDICE. . SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 10/21/03. 10/21/03 ENTERED AND COPIES MAILED AND FAXED.(ph, ) (Entered: 10/21/2003) 10/24/2003 36 STIPULATION AND ORDER THAT PURSUANT TO FRCP 41(a)(1) (ii) AND THE SETTLEMENT AGREEMENT, THAT THE PARTIES REQUEST THE COURT DISMISS THE CAPTIONED MATTER, INCLUDING ALL CLAIMS AND COUNTERCLAIMS, WITH PREJUDICE. . SIGNED BY JUDGE CLARENCE C. NEWCOMER ON 10/24/03. 10/24/03 ENTERED AND COPIES MAILED AND FAXED BY CHAMBERS(ph, ) (Entered: 10/24/2003) https://ecf.paed.uscourts.gov/cgi-bin/DktRpt.pl?'261521028494284-L_353_0-1 5/22/2007 EFTA00187411 United States District Court Eastern District of Pennsylvania - Docket Report Page 7 of 7 PACER Service Center Transaction Receipt 05/22/2007 18:33:24 PACER Login: du4480 Client Code: Description: Docket Report Search Criteria: 2:02-cv-07671-CN Billable Pages: 4 Cost: 0.32 https://ecIpaed.uscourts.gov/egi-bin/DktRpt.pl?261521028494284-L_353_0-1 5/22/2007 EFTA00187412 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA NELSON SHANKS Plaintiff, I LESLIE and ABIGAIL WEXNER, et al. • • • • CIVIL ACTION Defendants. NO. 02-7671 ORDER AND NOW, this day of September, 2003, upon consideration of Defendants' Motion For A Protective Order to reschedule and relocate the depositions of each Defendant, IT IS HEREBY ORDERED that Defendants' Motion is GRANTED and the Notices of Deposition issued are quashed without prejudice to have them rescheduled by agreement of the parties. BY THE COURT: Clarence C. Newcomer, S.J. PIILIT45448611 EFTA00187413 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA NELSON SHANKS Plaintiff, 1. LESLIE and ABIGAIL WEXNER, et al. Defendants. NO. 02-7671 CIVIL ACTION DEFENDANTS' MOTION FOR A PROTECTIVE ORDER TO OUASH NOTICE OF DEPOSITIONS Defendants, by and through their counsel, hereby move this Court, pursuant to Fed. R. Civ. P. 26(c)(2), for a protective order to reschedule and relocate the depositions of Jeffrey Epstein, Ghislaine Maxwell, and Abigail and Leslie Wexner, who received notices of oral deposition to be taken in the offices of Plaintiff's counsel, Gollatz, Griffin & Ewing, located in Philadelphia, Pa.: Jeffrey Epstein and Ghislaine Maxwell, noticed for September 9, 2003; Abigail and Leslie Wexner, noticed for September 10, 2003. In support of this motion, Defendants submit the accompanying Memorandum of Law. MILITA54486 EFTA00187414 Dated: September 5, 2003 J. Fox Attorney Identification No. 15261 Christopher J. Guiton Attorney Identification No. 89866 DRINKER BIDDLE & REATH LLP One Logan Square 18th and Cherry Streets Philadelphia, PA 19103-6996 Counsel for Defendants PHLI1145448611 EFTA00187415 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA NELSON SHANKS CIVIL ACTION Plaintiff, LESLIE and ABIGAIL WEXNER, et al. Defendants. : NO. 02-7671 MEMORANDUM OF LAW IN SUPPORT OF DEFENDANTS' MOTION FOR A PROTECTIVE ORDER TO QUASH NOTICE OF DEPOSITIONS Without any consultation with counsel for Defendants to find mutually acceptable dates and times, on August 27, 2003, Plaintiff Nelson Shanks provided notices to Defendants' counsel of the oral depositions of Defendants Jeffrey Epstein, Ghislaine Maxwell, Abigail Wexner and Leslie Wexner to be taken on September 9th and 10th, 2003 in the offices of Gollatz, Griffin & Ewing, P.C., in Philadelphia, Pa. As Plaintiff well knows, defendants Jeffrey Epstein and Ghislaine Maxwell reside in the U.S. Virgin Islands, and defendants Abigail and Leslie Wexner reside in New Albany, Ohio. While Plaintiff may be permitted to designate his location of choice for the depositions, this Court has the power and duty under Fed. R. Civ. P. 26(c) to determine the most appropriate location for each deposition. See e.g., O'Connor.. Trans Union Corp., 1998 U.S. Dist. LEXIS 6774 (E.D. Pa. May 11, 1998). This Court has previously determined "that as a general rule, if a deponent lives a substantial distance from the deposing party's residence, the deposing party should be required to take the deposition at PIII.M4544801 EFTA00187416 a location in the vicinity in which the deponent resides." First Fidelity Bancorporation!". National Union Fire Ins. Co. 1992 U.S. Dist. LEXIS 3367 (E.D. Pa. Mar. 5, 1992). Pursuant to Fed. R. Civ. P. 26(e)(2), defendants seek an order that would protect them from the undue burden and expense of traveling to Philadelphia for these depositions; defendants Jeffrey Epstein and Ghislaine Mawell will submit to a deposition in the Virgin Islands; and defendants Abigail and Leslie Wexner seek an order that would protect them from being forced to travel from New Albany, Ohio to Philadelphia for their depositions. Under the circumstances, the Notice served on August 27, 2003 requiring each of the defendants to fly to Philadelphia is unreasonable and unduly burdensome. As the Court well knows, the basis for asserting jurisdiction over these defendants does not include any instance when any of them visited Pennsylvania. It was Plaintiff who traveled to New York and Ohio in connection with this matter. Accordingly, if these depositions are to proceed, they should occur at the locations of the defendants. It is far less dislocating for Plaintiff's lawyer to travel to take these depositions in the Virgin Islands and Ohio than it would be to force four people to take the time required to travel to Philadelphia. Although Plaintiff had earlier expressed a commitment to working out a schedule that is convenient to all parties, Plaintiff has unilaterally scheduled the depositions with no regard to the inconvenience it may impose on the parties to be deposed. Such conduct is in direct contrast with the manner in which Defendants have attempted to depose Plaintiff. PEILM454486 EFTA00187417 For example, Defendants noticed the deposition of Plaintiff Nelson Shanks for June 9, 2003. Immediately thereafter, Defendants agreed with Plaintiff to postpone that date so that the parties could come to a mutually agreeable date for the deposition. Plaintiff still, nearly three months later, has yet to agree to a date in which Shanks can be deposed, but has instead unilaterally designated September 9th and 10th in Philadelphia as the time and place for Defendants' depositions. Defendants object to these depositions being taken in Philadelphia given the difficulty for these individuals to make arrangements to be deposed miles away from their respective residences. Based upon Plaintiff's recent reluctance to discuss, much less honor, any mutual agreements, Defendants ask this Court to quash Plaintiff's Notice of Depositions and grant this protective order, rescheduling the depositions for a date and time that is suitable for both the Defendants and Plaintiff, and relocating the depositions from Philadelphia to the U.S. Virgin Islands for Mr. Epstein and Ms. Maxwell; and New Albany, Ohio for the Wexners. Accordingly, this Court should grant Defendants' motion for a protective order and quash the depositions of Jeffrey Epstein, Ghislaine Maxwell, and Abigail and Leslie Wexner, without prejudice to have them rescheduled at a convenient location. CONCLUSION For all of the foregoing reasons, Defendants respectfully request that the Court grant its Motion for a Protective Order or such other relief as the Court deems appropriate. PFILM45448611 EFTA00187418 Dated: September 5, 2003 J. Fox AttorneyIdentification No. 15261 Christopher J. Guiton Attorney Identification No. 89866 DRINKER BIDDLE & REATH LLP One Logan Square 18th and Cherry Streets Philadelphia, PA 19103-6996 Attorneys for Defendants PHLM45448611 EFTA00187419 CERTIFICATE OF SERVICE I, Christopher J. Guiton, hereby certify that on this 51h day of September 2003, I caused a true and correct copy of the foregoing Defendants' Motion for a Protective Order and accompanying Memorandum of Law to be served as follows: VIA HAND DELIVERY Jeffrey Hofferman, Esquire Gollatz, Griffin & Ewing, P.C. Four Penn Center, Suite 200 Philadelphia, PA 19103 (Attorney for Plaintiff) Dated: September 5, 2003 By: Christopher J. Guiton PFILITS4544861I EFTA00187420 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA NELSON SHANKS Plaintiff; LESLIE and ABIGAIL WEXNER, et al. CIVIL ACTION Defendants. NO. 02-7671 CERTIFICATION OF GOOD FAITH EFFORTS TO RESOLVE DISCOVERY DISPUTES BEFORE FILING MOTION J. Fox, Esquire, hereby certifies that he is counsel for Defendants and that prior to filing Defendants' Motion for a Protective Order to reschedule and relocate the depositions of Jeffrey Epstein, Ghislaine Maxwell, and Abigail and Leslie Wexner, he engaged in good-faith efforts with Plaintiff's counsel, Jeffrey Hofferman, to resolve this dispute. He wrote Mr. Hofferman a letter requesting rescheduling. Mr. Hofferman did not bother to respond to the letter. Dated: September 5, 2003 J. Fox Counsel for Defendants, PFILIT1454486\ I EFTA00187421 Department of Licensing and Consumer Affairs Page 1 of 2 I/II.CA 11OIIIC BUCille“ LICCIISC Operalers License Iiumtl CerMlextions Commoner Minim Commisshmer Robertson Ahem the DIA 'A 'business Starch Business License Search Business Name Search CategoaA,2 New Business istings Image for Premium Listings Records per page: rir-3 Found 34 Records Reco1 rd2!14tlic)180 Enter Business Name (use fewer letters for more results) 'financial Search --Bookkeeping Services-- DEPAUL FINANCIAL SERVICES 340492-1829 FREDERIKSTED, St. Croix License #: 2-2020117-2006 WINSLOW & WINSLOW FINANCIAL SERVICES, INC. 940-713-9713 FREDERIKSTED, St. Croix License #: 2-2025606-2006 --Business & Management Consulting-- BARRY FINANCIAL SERVICES INC St. Thomas License #: 1-2025931-2007 EMAX FINANCIAL GROUP 340 719-4600 Christiansted, St. Croix License #: 2-2030892-2007 FINANCIAL TRUST COMPANY, INC. 340-775-2525 St. Thomas Gote1a) Roc Chr Cro Phone: (: Fax: (3' Adminish St. Joh Phone: (: Fax 0' - • i Prop. & Po I Sub P Thon Phone: (: Fax (3' http://www.dlca.gov.vi/bussearch.asp?norecs=10&name=financial 5/14/2007 EFTA00187422 Department of Licensing and Consumer Affairs Page 2 of 2 License #: 1-2021802-2006 GLOBAL FINANCIAL STRATEGIES, LLC St. Thomas License #: 1-1004878-2007 GOLDEN EAGLE FINANCIAL, LLLP 340-774-2273 St. Thomas License #:1-2013600-2006 GULFSTREAM FINANCIAL, LLC St. Thomas License #: 1-2028797-2007 HORIZON FUEL AND FINANCIAL MANAGEMENT 340-719-7915 Christiansted, St. Croix License #: 2-2030321-2007 HORIZON FUEL AND FINANCIAL MANAGEMENT, LIMITED LIABILITY LIMITED PARTNERSHIP 340-719-7915 CHRISTIANSTED, St. Croix License #: 2-2020644-2006 Found 34 Records 1234 Next Records ] to 10 Official Website of the USVI Department of Licensing and Consumer Affairs Webmastering by Vastimaging Site Last Updated May 19, 2003 http://www.dlca.gov.vi/bussearch.asp?norecs=10&name=financial 5/14/2007 EFTA00187423 Page I of 2 Westlaw. Not Reported in F.Supp. Page I Not Reported in F.Supp., 1998 WL 67676 (S.D.N.Y.) (Cite as: Not Reported in F.Supp.) H U.S.!. Epstein S.D. .Y.,1998. Only the Westlaw citation is currently available. United States District Court, S.D. New York. UNITED STATES OF AMERICA, Plaintiff, 1. Jeffrey E. EPSTEIN and Ivan S. Fisher, Defendants. No. 96 Civ. 8307(DC). Feb. 19, 1998. Mary Jo White, United States Attorney for the Southern District of New York, by Serene Nakano, Assistant United States Attorney, New York City, for the United States. Gage & Pavlis, by G. Robert Gage, Jr., Ellen J. Casey, New York City, for Ivan S. Fisher. MEMORANDUM DECISION CHIN, J. *I In this case, the United States (the "Government" ) seeks to evict defendants Jeffrey E. Epstein and Ivan S. Fisher from a building formerly used as a residence by the Deputy Consul General of the Islamic Republic of Iran ("Iran"). After diplomatic and consular relations with Iran were severed in 1980, the Office of Foreign Missions ("OFM") of the United States Department of State took possession of the building pursuant to the Foreign Missions Act, 22 U.S.C. § 4301 et seq. OFM leased the building to Epstein in 1992. Epstein eventually sublet the premises to Fisher, purportedly without the Governments consent. Fisher, in turn, sublet a portion of the premises to several other lawyers. In 1996, the Government purported to terminate Epstein's lease and brought this action to evict Epstein and Fisher. The other sub-tenants were later added as defendants. The Government also seeks to recover back rent from Epstein and Fisher. During discovery, the Government requested production of Fisher's 1996 tax return to verify the amount of rent that he had collected from his subtenants. Fisher objected to the request. At a conference on December 10, 1997, I overruled the objection on the condition that the return be protected by an appropriate confidentiality order, which the parties were to negotiate. Fisher and the Government, however, were unable to agree on the terms of a protective order. Hence, they submitted separate proposed protective orders for my consideration. The Government's proposed order contains a provision ("Proposed Paragraph 7(c)") that would permit the United States Attorney's Office for the Southern District of New York to disclose any confidential information governed by the protective order to other government agencies for the purpose of enforcing the criminal or civil laws of the United States. Thus, the Government seeks to reserve the right to use confidential information produced by Fisher in this case in unrelated civil or criminal matters. The Government contends that Proposed Paragraph 7(c) is necessary because the U.S. Attorney's Office has a statutory duty to enforce the laws, citing 28 U.S.C. § 547(c), and that it therefore cannot ignore any evidence of a violation of law-even evidence that comes to its attention only because it is produced pursuant to a protective order in discovery in a civil case. Fisher objects to Proposed Paragraph 7(c). He contends that use of any confidential documents produced in this case should be limited to this lawsuit. Fisher's objection is sustained, for three reasons. First, confidentiality orders arc intended "to 'secure the just, speedy, and inexpensive determination' of civil disputes by encouraging full disclosure of all evidence that might conceivably be relevant" Martindell g International TeL & Tel. Corp.. 594 F.2d 291, 295 (2d Cir.1979). Unless protective orders are "fully and fairly enforceable," persons O 2007 Thomson/West. No Claim to Orig. U.S. Govt. Works. https://web2.westlaw.com/print/printstream.aspx?sv=Full&rIti=1&prft—HTMLE&En=_top... 5/22/2007 EFTA00187424 Page 2 of 2 Not Reported in F.Supp. Pagc 2 Not Reported in F.Supp., 1998 WL 67676 (S.D.N.Y.) (Cite as: Not Reported In F.Supp.) relying upon such orders will be inhibited from providing essential testimony and information in civil litigation, "thus undermining a procedural system that has been successfully developed over the years for disposition of civil differences." Id. A provision that would permit the use of confidential information outside of this lawsuit would defeat the very purpose of the protective order. *2 Second, although the Court recognizes the strong public interest in obtaining all relevant evidence required for law enforcement purposes, the Government as investigator " 'has awesome powers' [that] render unnecessary its exploitation of the friuts of private litigation." Id. (quoting GAF Corp. I. Eastman Kodak Co., 415 F.Supp. 129, 132 (S.D.N.Y.1976)). Proposed Paragraph 7(c) should not be included in the protective order "merely to accommodate the Government's desire to inspect protected [information] for possible use in a criminal [or civil] investigation." MartindeR 594 F.2d at 296; cf. id. (denying Government's order to modify or vacate protective order to permit it access to witnesses' deposition transcripts protected by the order). The Government will still be able to fulfill its statutory obligation to enforce the law through ordinary criminal and civil process and by taking advantage of the substantial resources available to the Government to investigate suspected violations of the law. Third, tax information has traditionally been treated as private and confidential information. Section 6103 of the Internal Revenue Code, for example, specifically prohibits any person, including an officer or employee of the United States, from " disclos[ing] any return or return information obtained ... in any manner in connection with his [or her] service as such an officer or employee." 26 U.S.C. § 6103(a). Section 6103 also spells out the limited situations when an officer or employee may disclose return information. See, e.g., § 6103(hX2) (disclosure of returns and return information to Department of Justice employees), § 6103(hX4) (disclosure of returns or return information in judicial or administrative proceedings). This section provides specific limits on the disclosure of returns and return information and bolsters the conclusion that Fisher's tax return is entitled to protection from disclosure by the Government in this action. See Richards I Stephens. 118 F.R.D. 338, 339 (S.D.N.Y.1988) § 6103 is intended to protect the confidentiality of taxpayers' returns by " regulat[ing] ... disclosure of tax returns by people having access to tax returns in their official capacity "). Fisher should not become the subject of an IRS tax investigation merely because of documents he produced in what is essentially a landlord-tenant suit. For these reasons, I will enter a protective order that does not contain Proposed Paragraph 7(c). The Government may not use confidential information produced in discovery pursuant to the protective order for any purpose other than prosecuting this lawsuit, absent further order of the Court. SO ORDERED. S.D.N.Y.,1998. U.S. I. Epstein Not Reported in F.Supp., 1998 WL 67676 (S.D.N.Y.) END OF DOCUMENT O 2007 Thomson/West. No Claim to Orig. U.S. Govt. Works. https://web2.westlaw.com/print/printstream.aspx?sv=Full&rIti=18cprft—HTMLE5cfn=_top... 5/22/2007 EFTA00187425 640 818 FEDERAL SUPPLEMENT tered trade dress, in violation of 2 43(a) of the Lanham Act. Hargen contends that FT cannot obtain relief under the Lanham Act because FT's trade dress is Ilinetionall IN, 111 A trade dress is functional when the trade dress "is essential to the uses or purposes of the article or if it affects the cost or quality of the article." Inwmxl Labs., Inc- Ives Lobs., Inc.. 456 U.S. 844, 850 n. 10, 102 S.Ct. 2182, 2187 n. 10, 72 L.Ed.2d 606 (1982). A product's trade dress must be viewed in its totality. te Sportsac, Ina'. K Mart Corp., 754 F.2d 71, 75 (2d Cir.1985). However, if a trade dress is found to be functional, its features may be copied even if conibsion would result. American Greetings Corp.'. Dan-Dee Onportit Ina, 807 F.2d 1136, 1141 (3d Cir.1986). FT states that its packaging design was chosen because the design was pretty, so- phisticated, and showed off the novelty value of the deodorant stone. Rosenblatt dep. at 520-522. FT also states that FT colored the package blue because it liked that color, not because blue was a common color used in cosmetic packaging. Id. at 378. Moreover, the evidence before us indicates FT and at least one other producer of deodorant stones pack their deodorant products in other pack- aging besides plastic boxes. For example, plaintiff also packs its deodorant stone in a soft plastic pouch, a triangular cardboard box, a shrink-wrapped soap dish and satin pouches of various colors. Rosenblatt aff. 92 5, 9, 13. Moreover, another company, whose name Rosenblatt could not recall at his deposition, distributes a similar product in a velvet, drawstring pouch. Rosenblatt dep. at 379-380. This evidence suggests that plaintiffs packaging in this case may not be functional. Defendant claims that FT's packaging is functional because the packaging is allegedly efficient and compact, because the packaging allows consumers to see the product, and because the packaging is commonly used in the stick and roll-on deodorant industry. 4. Defendant alternatively claims that even if the packaging is not functional, plaintiff cannot claim that the color blue is distinctive of its product and therefore protectable. Memo in Support of Summary Judgment at 16. Plaintiff. Moreover, Hargen also claims that FT's plas- tic boxes are functional because they allow for easy shipping, allow for shelf display and stacking, protect the crystals from chipping, protect the crystals from dissolving in moist places, and are designed to hold the crystal deodorant in the same way that a soap dish holds soap. Memo in Support of Summary Judgment at 11-13. See Rosenblatt dep. at 95; vol. IV at 19. As is apparent, disputed issues of material fact remain about the func- tionality or non-functionality of the plaintiffs trade dress. Therefore, Hargen's motion for summary judgment on FT's trade dress claims is denied. III. Causes of Action Under New York Law Because Hargen has undertaken no inde- pendent analysis of FT's New York causes of action, Hargen's motion for summary judg- ment on these causes of action is denied. Conclusion Hargen's motion for summary judgment is denied. SO ORDERED. Michael R. STROLL Plaintiff, I Jeffrey EPSTEIN, Defendant. No. 92 Civ. 1021 (EC). United States District Court, S.D. New York. April 15, 1993. Second joint venturer brought suit against first venturer, seeking to recover un- however, is not claiming exclusive rights to the use of blue in its packaging. Memo in Opp. to Summary Judgment at B. Rather, plaintiff claims a proprietary interest in the entirety of Its packaging. Id at 12. EFTA00187426 STROLL I EPSTEIN 641 Cite as /118 F.Supp. MO (S.D.N.Y. Ms) der contract in which second venturer re- leased his interest in venture. First ventur- er moved to dismiss or for summary judg- ment, and second venturer cross-moved for summary judgment. The District Court, Conboy, J., held that: (1) agreement under which first joint venturer agreed to return capital contribution to second joint venturer upon return of all interests in venture by second venturer unambiguously indicated that first venturer was acting solely in repre- sentative capacity, not personal capacity, and (2) modification of original joint venture agreement making first joint venturer per- sonally liable for managing affairs of joint venture could not be construed as imposing personal liability on first joint venturer in event joint venture subsequently bought out second venturer's interest. Motions granted in part and denied in part. I. Federal Courts .3=409 In diversity action, federal court sitting in New York must apply New York law, including New York's choice-of-law rules. 2. Contracts e=s144 Under New York's choice-of-law rules, when court is construing meaning of con- tract, court should apply local law of state which has greatest interest in or most signifi- cant relationship to transaction and parties. 3. Joint Adventures (1.4(1) New York was state with most signifi- cant relationship to agreement in which one joint venturer agreed to return capital contri- bution to another venturer, and thus, New York law governed meaning of agreement, in diversity action; contract was executed in New York and one party was New York citizen. 4. Bills and Notes o=,I47 Contract under which one joint venturer agreed to return capital contribution to an- other venturer was not "negotiable instru- ment" as it was not payable to order or bearer, and thus, provision of New York Uniform Commercial Code governing inter- pretation of negotiable instruments did not apply. N.Y.McKinney's Uniform Commer- cial Code §§ 3-104(1)(4 3-403, 3-403(2)(b). See publication Words and Phrases for other Judicial constructions and def- initions. 5. Contracts 0:0176(2) Whether contract is ambiguous is matter of law to be determined by court. 6. Contracts 0=443(2) Contract is "ambiguous" If it is reason- ably susceptible of more than one interpreta- tion. See publication Words and Phrases for other judicial constructions and def- initions. 1. Contracts 4=143(2) Unambiguous contract language is not rendered ambiguous simply because parties urge different interpretations in litigation. & Contracts G=.143.6 Whether contract is ambiguous is to be determined by considering contract as whole, under New York law. 9. Joint Adventures l=04(1) Agreement under which first joint ven- turer agreed to return capital contribution to second joint venturer upon return of all in- terests in venture by second venturer unam- biguously indicated that first venturer was acting solely in representative capacity, not personal capacity, when he agreed to return second venturer's contribution, under New York law; agreement indicated that first venturer was acting both as officer of ven- ture and as agent for venture, although first joint venturer did not sign contract expressly In representative capacity. 10. Contracts u=179 Contract which demonstrates on its face that defendant was acting solely in represen- tative capacity will not be rendered ambigu- ous under New York law simply because defendant failed to sign contract in represen- tative capacity. 11. Principal and Agent <2,136(1) Under New York law, agent for dis- closed principal will not be held personally liable unless there is clear and explicit evi- EFTA00187427 642 818 FEDERAL SUPPLEMENT dence of agent's intent to substitute or add his ovm personal liability for, or to, that of principal. 12. Evidence e=384 If contract is unambiguous on its face, extrinsic evidence may not be presented to create ambiguity, under New York law. 13. Joint Adventures d=.4(1) Modification of original joint venture agreement making first joint venturer per- sonally responsible for managing affairs of joint venture could not be construed as im- posing personal liability on first joint ventur- er in event of joint venture subsequently buying out second venturer's interest in ven- ture. 14. Evidence ca384 Where parties have expressed their agreement in unambiguous and integrated writing, New York's parol-evidence rule op- erates to exclude evidence of all prior and contemporaneous negotiations or agreements offered to contradict or modify terms of writ- ing. 15. Evidence ca397(2) Writing is "integrated" for purpose of New York's parol-evidence rule if it com- pletely and accurately embodies all mutual rights and obligations of parties. See publication Words and Phrases for other judicial constructions and def- initions. 16. Evidence c=.397(1) Evidence that first joint venturer orally promised to personally repay second ventur- er's capital contribution contradicted unam- biguous terms of integrated written agree- ment entered by first venturer in his repre- sentative capacity, and thus was inadmissible under New York's parol-evidence rule. 17. Joint Adventures e=.4(1) Alleged partial payment or promise to pay personally by first joint venturer after 1. As this Court will consider matters extrinsic to the complaint. we will treat defendant Epstein's motion to dismiss as a motion for summary judg- ment. See Fcd.R.Civ.P. 12(b). execution of agreement under which second joint venturer's capital contribution was to be returned by venture could not make first venturer personally liable under such con- tract. IS. Contracts ea170(1) Where contract is unambiguous on its face, evidence of conduct occurring subse- quent to execution of contract may not be introduced to create ambiguity. Arthur M. Handler, Whitman & Ransom, New York City, for plaintiff. Elliot Silverman, Cold & Wachtel, New York City, for defendant. ORDER CONBOY, District Judge: We have before us an action for breach of contract. Plaintiff Michael R. Stroll ("Stroll") seeks to recover from defendant Jeffrey Epstein ("Epstein") money allegedly owed pursuant to a contract in which Stroll relinquished his interest in a joint venture. Epstein asserts that he executed the contract in a representative capacity, as an agent for the venture and as an officer of the Intercon- tinental Asset Group ("IAA.'), and that, therefore, he is not personally liable under the contract. Pending before the Court are two motions: (1) defendant Epstein's motion to dismiss the complaint for failure to state a claim upon which relief can be granted, or, in the alter- native, for summary judgment: I and (2) plaintiff Stroll's cross-motion for summary judgment. For the reasons that follow, Ep- stein's motion for summary judgment is granted, and Stroll's cross-motion is denied. Discussion 2 A. The November 1984 Contract (1-31 Defendant Epstein moves for sum- mary judgment on the ground that the No- 2. This Court has diversity jurisdiction over the present action pursuant to 28 U.S.C. § 1332(a). as plaintiff Stroll is a citizen of Florida. defen- dant Epstein is a citizen of New York. and the sum in controversy is 5440.000. EFTA00187428 STROLL I EPSTEIN 643 carnets F.Supp. 440 (00N.Y. 19931 vember 1984 contract unambiguously indi- F.Supp. at 1366. A contract is ambiguous if cams the parties' intention that Epstein was acting solely in a representative capacity when he agreed to return Stroll's capital contribution in the joint venture.3 I.4-8) "Under New York law,' ... the Court must look first to the parties' written agreement to determine the parties' intent and [must' limit its inquiry to the words of the agreement itself if the agreement sets forth the parties' intent clearly and unambig- uously? Sterling Drug Inc. Bayer AG, 792 F.Supp. 1357, 1365 (S.D.NN.1992). See also Chimart Associates I Paul, 66 N.Y.2d 570, 498 N.Y.S2d 344, 34, 489 N.E.2d 231, 233 (Ct.App.1986) (Where a contract is un- ambiguous on its face, the Court may not consider evidence extrinsic to the contract to determine the parties' intent). Whether a contract is ambiguous is a matter of law to be determined by the Court. Sterling, 792 In a diversity action, a federal court sitting in New York must apply New York law, Including New York's choice of law rules. I & B Schoen- feld Fur Merchants. Inc I Kilbourne & Donahue, Inc.. 704 F.Supp. 466, 4.68 (S.D.N.Y.1989). See Klaxon Co. Ste for Electric Mfg. Co., 313 U.S. 487. 496, 6 S.Ct. 1020. 1021. 85 L.Ed. 1477 (1941): see also Erie R. Co.)! Tompkins, 304 U.S. 64. 78. 58 SO. 817, 822. LEd. 1188 (1938). Under New York's choice of law rules, when a court Is construing the meaning of a contract. the Court should "apply the local law of that state which has the greatest interest in or the most significant relationship to the transaction and the parties." See Thar Fund. Inc. !Ins. Co. of N. Am., 580 Kid 1158. 1162 (2d i, 1978). cat denied, 440 U.S. 912, 99 S.Ct. 1226. 59 L.Ed.2d 461 (1979). In the present action, the state with the most significant relationship to the transaction is New York: the contract being sued upon was executed in Ncw York. defendant Ep- stein Is a New York citizen. and I.A.G. is a New York corporation. Moreover, both parties agree that New York law applies in this case. Accord- ingly, we look to New York law to construe the meaning of the November 1984 contract. 3. Initially, we note that Epstein contends that this action is time-barred pursuant to N.Y. C.P.L.R. § 213(2) (McKinney 1990). which pro- vides • six.year statute of limitations for breach of contract claims. Stroll contends that the stat- ute of limitations was tolled as he received a $10,000 personal check from Epstein in May of 1988. accompankd by Epstein 's promise to pay more of the debt upon his receipt of personal funds. See Commissioners of the State Ins. Fund I Warner. 156 A.D.2d 131, 548 N.Y.S.2d 883, 883 (1st Dept 1989) (stating the common law rule that the statute of limitations will be tolled if it is reasonably susceptible of more than one interpretation. Chimart, 498 N.Y.S2d at 346, 489 N.E.2d at 233. Unambiguous con- tractual language is not rendered ambiguous "simply because the parties urge different interpretations in litigation." Sterling, 792 F.Supp. at 1366. Moreover, whether a con- tract is ambiguous is to be determined by considering the contract as a whole. Wing Wing, 112 A.D.2d 932, 492 N.Y.S.2d 450, 452 (2d Dep't 1985). 191 Applying the above-mentioned princi- ples, this Court concludes that the November 1984 contract, when read as a whole, unam- biguously indicates the parties' intention that Epstein was acting solely in a representative capacity when he agreed to return Stroll's capital contribution. The body of the con- tract makes clear that Epstein executed the the creditor can show that the payment "was • payment of a portion of the admitted debt ... accompanied by circumstances amounting to an absolute and unqualified acknowledgment by the debtor of more being due, from which a promise may be inferred to pay the remainder."). Ep- stein asserts that he paid Stroll 510,080 because Stroll had purchased • horse for him. Epstein presents no evidence of this purchase, though. Because all reasonable inferences on a summary Judgment motion are to be drawn in favor of the non-moving party. Knight US. Fire Ins. Co., 804 F.2d V. 11 12d Cir.1981), we hold that the present action is not time-barred for the pur- poses of this motion. 4. Stroll contends that § 3-403(2Xb) of the New York Uniform Commercial Code should govern our interpretation of the November 1984 con- tract. See N.Y.U.C.C. § 3-403(21(b) (McKinney 1991). We disagree. Section 3-403 governs ne- gotiable Instruments. Finnish Fur Sales Co. I Juliette Shutoff Furs. Inc., 770 F.Supp. 139. Ian (S.D.N.Y.1991): Rotuba Extruders, Inc. I Ceppos. 46 N.Y.2d 223, 413 N.Y.S.2d 141. 43. 385 N.E.2d 1068, 1070 (Ct.App.1978). As Stroll con- cedes. the present contract Is not a negotiable Instrument because It is not "payable to order or to bearer." See N.Y. U.C.C. § 3-104(11(d) (McKinney 1991). We have found no case which applies § 3-403(21(b) to a non-negotiable instru- ment. Moreover, at least one New York court has specifically held that if the contract being sued upon is a not a negotiable instrument, § 3- 403 cannot be applied to determine whether an agent executed the contract in an individual ca- pacity. Pepsi-Cola Buffalo Bottling Corp. Wehrle Drive Supermarkets. 123 A.D.2d 515. 5 N.Y.S.2d 107. 108 14th Dept 1986). EFTA00187429 644 818 FEDERAL SUPPLEMENT contract in a representative capacity. In one sentence, the contract states that the Novem- ber 1984 contract shall consist of terms and conditions verbally agreed upon on Septem- ber 10, 1984. In an adjacent sentence, the contract states that the following agreement was reached on September 10, 1984: "in your capacity as both an officer of Intercon- tinental Asset Group and as agent for the joint venture you verbally agreed to accept my rescission of my acquisition of the joint venture ab initio, and my tender to you of all my interests in the venture and you are to return all amounts contributed by me to the venture. . . ." (emphasis added). Read to- gether, these two sentences clearly indicate that the November 1984 contract was execut- ed by Epstein in his representative capacity. Stroll asserts that the above-quoted sen- tence demonstrates that Epstein acted in a representative capacity only when he agreed to accept Stroll's demand for rescission, and that Epstein personally agreed to buy out Stroll's interest in the venture. We find Stroll's interpretation of this sentence strained and unreasonable as there is noth- ing in the sentence to indicate that the phrase "in your capacity as ... an officer .. . and as agent. ..." does not apply to the entire sentence. In an attempt to establish Epstein's per- sonal liability, Stroll points to selected phras- es of the contract which use personal pro- nouns to refer to Epstein (e.g.. "I hereby accept your demand for rescission and tender upon the terms and conditions contained herein."). However, the very first time the contract uses a personal pronoun to refer to Epstein, the contract states, "in your capaci- ty as both an officer of Intercontinental As- S. Under New York 1:O111ITIOll law. an agent for u disclosed principal will not be held personally liable "'unless there is clear and explicit e‘ (fence of the agent's intention to substitute or superadd his own personal liability for. or tg. that of his principal. Paribas Properties. tow.' Brown. 146 A.D.Til 522. 536 N/S.2d 1007. 1008 (1st Dept) igurnow Member F Weiss. 306 N.Y. 1, 4, 114 N.E.2d 177 1Ct.App.19531). As stated in Salzman Sign Co.l Beck, 10 N.Y.2d 63. 217 N.YS 24 55. 57, 176 6,11.2d 74. 76 (Ct.App. 1961), the rational underlying this presumption against personal liability %%US the "great danger set Group and as agent for the joint venture you . . . agreed to accept my rescission of my acquisition ... and my tender to you of all my interests in the venture and you are to return all amounts contributed by me to the venture...." (emphasis added). This sen- tence indicates that when the contract, after this sentence, uses only personal pronouns to refer to Epstein, it is referring to