Quash Non-Judicial Subpoenas Future Tech. Assoc.s LLC. v. Special Comm'r of Investigation
| Decision Date | 17 March 2011 |
| Docket Number | 115054/2010 |
| Citation | 2011 NY Slip Op 50509 |
| Parties | In the Matter of a Motion to Quash Non-Judicial Subpoenas Future Technology Associates, LLC, TAMER SEVINTUNA, JONATHAN KROHE, and SWAROOP ATRE, Petitioners, v. Special Commissioner of Investigation for the New York City School District and DEPARTMENT OF INVESTIGATION OF THE CITY OF NEW YORK, Respondents. |
| Court | New York Supreme Court |
OPINION TEXT STARTS HERE
For petitioners:
Jim Walden, Esq.,for FTA and Krohe
Gibson, Dunn & Crutcher LLP
Charles E. Clayman, Esq., for Sevintuna
Clayman & Rosenberg
Susan Hoffinger, Esq. for Atre
Hoffinger Stern & Ross, LLP
For respondents:
Gerald P. Conroy, Dep. Commissioner
Richard J. Condon, Spec. Commissioner of Investigation for the New York City
School District
By notice of petition dated November 19, 2010, petitioners move pursuant to CPLR 2304 for an order quashing three non-judicial subpoenas issued to petitioners Tamer Sevintuna (Sevintuna), Jonathan Krohe (Krohe), and Swaroop Atre (Atre), and an order preventing respondents from asking questions that are prohibited by law.
By notice of cross-motion dated January 14, 2011, respondents cross-move pursuant to CPLR 2308(b) for an order compelling compliance with the subpoenas. For the reasons that follow, the petition to quash the subpoenas is granted, and respondents' motion to compel is denied.
Future Technology Associates, LLC (FTA) is a limited liability company located in Brooklyn, New York. A self-described minority-owned business which employs many minority workers, some of whom are "technically gifted programmers" under the United States H1-B visa program (Petitioners' Memorandum of Law, at 4), it has, since 2005, provided computer consulting services, specifically "ongoing financial planning systems programming and services" for the New York City Department of Education (DOE). Krohe and Sevintuna are both owners of FTA, and Atre is an FTA employee. Krohe also owns Mera Consulting LLC (Mera), a limited liability company that was FTA's corporate affiliate and provided internal accounting related to some work performed by FTA for the DOE. (Reply Memorandum of Law dated Jan. 21, 2011 [Reply Memo.]).
The FTA work site is located at a DOE facility. (Affidavit of Jonathan Krohe in Support of Order to Show Cause, dated Nov. 17, 2010 [Krohe Affid.], ¶ 2). Presently, FTA has a three-year, $43.2 million contract with DOE. (Affirmation of Gerald P. Conroy, Esq., in Opposition to Petition for Order to Quash Three Subpoenas Ad Testificandum and in Support of Cross-Motion to Compel Compliance, dated Jan. 14, 2011 [Conroy Aff.]).
In July 2009, three articles appeared in the New York Daily News about FTA, its employees, and the amount of money that DOE was paying FTA for its services. Petitioners describe these articles as "erroneous" and "xenophobic," and suggestive of "something untoward about our use of foreign workers employed under H1-B visas for programming services." (Id.¶ 6).
Soon thereafter, respondent Special Commissioner of Investigation for the New York City School District (SCI) opened an investigation concerning DOE and its contract with FTA. SCI is a part of respondent the Department of Investigation of the City of New York (DOI), and is mandated to "investigate allegations of corruption, conflicts of interest, unethical conduct or other misconduct occurring within the New York City School District . . . ." (Conroy Aff., ¶ 1).
FTA provided SCI with voluminous documentation and expressed its intent to cooperate with the investigation. (Affirmation of Jim Walden in Support of Motion to Quash, dated Nov. 18, 2010 [Walden Nov. 2010 Aff.], ¶ 7).
Representatives of SCI appeared at the FTA work site on several occasions from November 2009 to November 2010. In November 2009, they came with a subpoena duces tecum. Thereafter, petitioners retained present counsel. In April 2010, respondents sought to interview witnesses at the work site and serve subpoenas in connection with the investigation. That same month, counsel for petitioners twice met with SCI in an effort to cooperate and provide information, and unsuccessfully sought from it information concerning the basis for the investigation. (Walden Nov. 2010 Aff.). In June 2010, SCI representatives allegedly began asking two FTA consultants questions which petitioners describe as "disruptive" and in full view of the DOE staff. (Krohe Affid. ¶ 8).
SCI again appeared at the FTA work site in September 2010, and allegedly spoke to two FTA consultants without counsel, although the consultants allegedly asked that they be contacted through counsel only (Krohe Affid.., ¶ 10), and on October 18, 2010, they interviewed an FTA employee with counsel present. He was asked about an employee of a company called Krono Biligisayar (Krono), and whether the employee was a Turkish national. Apparently, the employee had worked at the FTA work site in Brooklyn, but now works remotely from Turkey. SCI also fruitlessly asked the FTA employee whether he knew if the "Krono employee's immigration status was the reason why he worked from Turkey." (Conroy Aff., ¶ 34).
Three days later, on October 21, 2010, SCI interviewed another FTA employee with counsel present, asking if the employee was in the United States on a work visa and if FTA was obliged to certify his status with immigration authorities, and on October 27, 2010, they spoke to two additional FTA employees without counsel present. During the final visit, on November 8, 2010, an FTA consultant was interviewed by SCI and asked about his H1-B Visa and whether he had information about "inaccurate representations about his employment status." (Id., ¶ 36).
SCI served Atre with a subpoena ad testificandum, dated October 26, 2010, requesting that he appear at the SCI and DOI Manhattan offices. The same subpoenas, dated November 4, 2010, were served on Sevintuna and Krohe. All command, in pertinent part, the witnesses' appearance and attendance "to testify under oath in the matter of an investigation relating to allegations of corruption, conflicts of interest, unethical conduct or other misconduct occurring within the New York City School District." (Krohe Affid., Exh. 3).
Petitioners now move for an order restraining respondents from asking questions outside the scope of their jurisdiction and prohibited by law, and quashing the non-judicial subpoenas issued to Atre, Sevintuna and Krohe on the ground that the "entire investigation has been a harassing, overbroad, fishing expedition and involves impermissible questions in violation of the legal prohibitions of Mayoral Executive Order 41." (Krohe Affidavit, ¶ 1). They claim that in every interview SCI "has asked questions about the immigration status and nationality of FTA's employees, including the witnesses themselves and others," and that, to date, SCI has provided it with no information about the substance of the subpoenas. They believe that SCI intends to continue asking about their and others' immigration status and to find evidence that FTA breached its contract with DOE. (Petition to Quash [Pet.], ¶ 15).
Petitioners maintain that they have been cooperative with the investigation thus far, having sought, at SCI's demand, documents from the foreign-based consulting firms despite their belief that India and Turkey, nations of origin of some of their employees, have data privacy rules that would restrict the firms from producing documents to respondents. According to counsel, counsel for respondent asserted that noncompliance would constitute a failure to cooperate which constitutes a breach of the DOE/FTA contract. (Walden Nov. 2010 Aff.).
Petitioners also deny respondents' characterization of the foreign-based consulting firms as subcontractors, asserting that they have "provided extra programming support on a range of projects," and allege that the DOE was aware of the consultants who frequently participated in conference calls with DOE about various projects. (Walden Nov. 2010 Aff., ¶ 7).
Petitioners complain that the SCI representatives harassed them by threatening to contact DOE and persuade them to stop doing business with FTA. They argue that any breach of the DOE/FTA contract with respect to subcontracting is curable and that if there were any question about the nature of their consulting arrangements, they would see to curing any such breach. They maintain that respondents have ignored their request that SCI contact their employees through counsel, and assert that "pending a resolution of any conflict of interest issues," petitioners' counsel represents FTA's employees. (Walden Nov. 2010 Aff.).
Petitioners thus assert that they have been subject to a fishing expedition, in that respondents are simply looking for any violations. Having already voluntarily provided respondents with many documents and agreed to comply with the subpoenas with "reasonable modifications" (Petitioners' Exh. 9), petitioners perceive that they are being harassed, as evidenced by respondents' alleged threats, disruptive visits to the FTA work site, as well as the documented questions to FTA employees about nationality, immigration, and visa status. As many of FTA's employees are foreign-born, petitioners contend that the SCI visits and questions heighten "fears of reprisal, which are common even among legal aliens." (Petitioners' Memorandum of Law, at 2).
Respondents allege that they seek to investigate alleged subcontracts entered into between FTA and foreign companies, which is prohibited by the DOE/FTA contract absent a written waiver. They concede, however, that the current DOE/FTA contract permits FTA consultants to work off-site with prior approval but nonetheless believe that subcontracting with and receiving services from foreign firms is prohibited. They are thus concerned that overseas firms may have had access to confidential DOE data,...
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