New York’s Commercial Dispute Rocket Docket

The state of New York now offers a consensual accelerated commercial dispute docket for the Commercial Division of its State courts.  Rule 9 of Section 202.70(g) of the Uniform Rules for the Supreme and County Courts provides that disputing parties who consent to this process must be ready for trial in nine months (including completion of mandatory mediation).

This accelerated process, however, comes with certain procedural trade-offs, such as discovery limitations and waivers of certain procedural rights and objections.  For example, the parties waive objections to personal jurisdiction and forum non-conveniens; they waive the right to jury trial, the right to recover punitive or exemplary damages, and the right to an interlocutory appeal. Discovery limitations include limitations on the number of interrogatories, the number of requests to admit, and the number of depositions. E-discovery has also been limited by requiring the description of custodians from whom electronic documents may be collected to be narrowly tailored to include only those individuals whose electronic documents may reasonably be expected to contain evidence that is material to the dispute.  The rule also provides that if the costs and burden of complying with e-discovery requests are disproportionate to the nature of the dispute or the amount in controversy, the court will deny such requests or fashion a cost-shifting remedy.

Rule 9 proposes the following model clause for parties to put in their contracts to agree in advance to this accelerated procedure:

“Subject to the requirements for a case to be heard in the Commercial Division, the parties agree to submit to the exclusive jurisdiction of the Commercial Division, New York State Supreme Court, and to the application of the Court’s accelerated procedures, in connection with any dispute, claim or controversy arising out of or relating to this agreement, or the breach, termination, enforcement or validity thereof.”

For more details, see Rule 9 in full below.

Rule 9. Accelerated Adjudication Actions.

a) This rule is applicable to all actions, except to class actions brought under Article 9 of the CPLR, in which the court by written consent of the parties is authorized to apply the accelerated adjudication procedures of the Commercial Division of the Supreme Court.  One way for parties to express their consent to this accelerated adjudication process is by using specific language in a contract, such as: “Subject to the requirements for a case to be heard in the Commercial Division, the parties agree to submit to the exclusive jurisdiction of the Commercial Division, New York State Supreme Court, and to the application of the Court’s accelerated procedures, in connection with any dispute, claim or controversy arising out of or relating to this agreement, or the breach, termination, enforcement or validity thereof. “

b) In any matter proceeding through the accelerated process, all pre-trial proceedings, including all discovery, pre-trial motions and mandatory mediation, shall be completed and the parties shall be ready for trial within nine (9) months from the date of filing of a Request of Judicial Intervention (RJI).

c) In any accelerated action, the court shall deem the parties to have irrevocably waived:

1. any objections based on lack of personal jurisdiction or the doctrine of forum non conveniens;
2. the right to trial by jury;
3. the right to recover punitive or exemplary damages;
4. the right to any interlocutory appeal; and
5. the right to discovery, except to such discovery as the parties might otherwise agree or as follows: (i) There shall be no more than seven (7) interrogatories and five (5) requests to admit; (ii) Absent a showing of good cause, there shall be no more than seven (7) discovery depositions per side with no deposition to exceed seven (7) hours in length. Such depositions can be done either in person at the location of the deponent, a party or their counsel or in real time by any electronic video device; and (iii) Documents requested by the parties shall be limited to those relevant to a claim or defense in the action and shall be restricted in terms of time frame, subject matter and persons or entities to which the requests pertain.

d) In an accelerated action, electronic discovery shall proceed as follows unless the parties agree otherwise: (i) the production of electronic documents shall normally be made in a searchable format that is usable by the party receiving the e-documents; (ii) the description of custodians from whom electronic documents may be collected shall be narrowly tailored to include only those individuals whose electronic documents may reasonably be expected to contain evidence that is material to the dispute; and (iii) where the costs and burdens of e-discovery are disproportionate to the nature of the dispute or to the amount in controversy, or to the relevance of the materials requested, the court will either deny such requests or order disclosure on condition that the requesting party advance the reasonable cost of production to the other side, subject to the allocation of costs in the final judgment.