Parties not Limited to Formal Discovery Process

On June 23, 2014, Justice Bransten of the New York County Commercial Division issued a decision in AMBAC Assurance Corp. v. Countrywide Home Loans, Inc., 2014 NY Slip Op. 31615(U), ruling that parties to a litigation may collect evidence from non-parties outside the formal discovery process.

In AMBAC Assurance Corp., the defendant raised a number of objections to fact gathering and analysis the plaintiff had conducted outside the formal discovery process. The court rejected the defendant's arguments, and noted regarding the general permissibility of informal discovery:

[T]here are no statutes and no rules expressly authorizing-or forbidding-ex parte discussions with any non-party. Article 31 does not close off these avenues of informal discovery, and relegate litigants to the costlier and more cumbersome formal discovery devices. [T]he Court of Appeals [has] permitted an attorney to contact a doctor, ex parte, to conduct informal discovery. The primary concern was that the non-party must not be gulled into making an improper disclosure so it is important that attorneys would make their identity and interest known to interviewees and comport themselves ethically.

(Internal quotations and citations omitted).

There are often sound tactical reasons to gather evidence outside the formal discovery process. However, parties must still meet their own discovery obligations and keep and eye on the need to obtain evidence in a form and manner that will make it admissible at trial.