FEDERAL TRADE COMMISSION, Plaintiff, v. NPB ADVERTISING, INC., et al., Defendants Case No. 8:14-CV-1155-T-23TGW United States District Court, M.D. Florida, Tampa Division Signed April 14, 2017 Counsel Elizabeth Olivia Tucci, Mary Lucile Johnson, Sydney Martin Knight, Tawana E. Davis, Elizabeth Jones Sanger, Serena Viswanathan, Federal Trade Commission Bureau of Consumer Protection, Washington, DC, for Plaintiff. Nicholas Scott Congleton, Ft. Lauderdale, FL, Pro Se. Eric S. Koenig, Trenam Kemker, Tampa, FL, for Defendants Dylan Craig Loher. Raul Valles, Jr., Rocke, McLean & Sbar, PA, Tampa, FL, for Defendants Nevada Vanderford. David Lisko, Holland & Knight LLP, Tampa, FL, for Defendants DSCN LLC, Thomas Bell. Wilson, Thomas G., United States Magistrate Judge ORDER *1 THIS CAUSE came on for consideration upon the Defendant Congleton's Motion to Quash Subpoena Duces Tecum (Doc. 105) and the plaintiff's response thereto (Doc. 116). The defendant and his nonparty wife, Nevada Vanderford (“Vanderford”), seek to quash a Subpoena to Produce Documents, Information, or Objects or to Permit Inspection of Premises in a Civil Action, that was served on Vanderford seeking various financial information (Doc. 105). The defendant and Vanderford claim that the plaintiff has not set forth the proper predicate in order to obtain the requested information and that the marital privilege protects disclosure of the information (id.). The plaintiff forcefully counters that it has demonstrated that the requested information is relevant in determining whether the defendant has assets to pay the unsatisfied judgment of thirty million dollars entered against him, and that the information is not protected by the marital privilege (Doc. 116). A judgment creditor may utilize the Federal Rules of Civil Procedure or the Florida Rules of Civil Procedure to obtain post-judgment discovery. See In re: Clerici, 481 F.3d 1324, 1337 (11th Cir. 2007) (explaining that a judgment creditor has “the choice of federal or state discovery procedures to conduct post-judgment discovery”); United States v. McWhirter, 376 F.2d 102, 106 (5th Cir. 1967) (explaining that Fed.R.Civ.P. 69(a), provides the method of discovery and “permits the use of state discovery practice”); The Trustees of the North Florida Operating Engineers Health and Welfare Fund v. Lane Crane Service, Inc., 148 F.R.D. 662, 663 (M.D. Fla. 1993) (stating that “Rule 1.560, Florida Rules of Civil Procedure, which follows verbatim language contained in Rule 69(a), FRCP, is a separate basis for obtaining discovery in aid of execution”). Rule 69(a)(2) of the Federal Rules of Civil Procedure provides:[1] In aid of the judgment or execution, the judgment creditor or a successor in interest whose interest appears of record may obtain discovery from any person—including the judgment debtor—as provided in these rules or by the procedure of the state where the court is located. Consequently, discovery is broad under Rule 69(a)(2), and a judgment creditor is permitted to obtain discovery from nonparties. STG Secure Trading Group, Inc. v. Solaris Opportunity Fund, LP, 2007 U.S. Dist. Lexis 102645 at *5 (S.D. Fla. 2007); see also Thomas v. French & French, LTD, 2012 WL 1788188 at *––––, 2012 U.S. Dist. Lexis 160345 at **2-3 (M.D. Fla. 2012) (explaining that discovery is broad under Rule 69(a)(2) and permits a judgment creditor to discover a debtor's current and past assets); National Union Fire Insurance Co. Of Pittsburgh, PA v. Van Waeyenberghe, 148 F.R.D. 256 at **2-3 (N.D. Ind. 1993) (stating that post judgment discovery is very broad and “permit[s] a judgment creditor to obtain information ‘so that he may find out about assets on which execution can issue or about assets that have been fraudulently transferred...’ ”) quoting C. Wright & A. Miller, Federal Practice and Procedure § 3014 at p. 72 (1973). Thus, the purpose of discovery under Rule 69(a)(2), is to determine the assets that can be used to pay a judgment and to discover a judgment debtor's fraudulent transfer of assets or concealment of assets. See VFS Financing, Inc. v. Speciality Financial Corp., 2013 WL 1413024 at *––––, 2013 U.S. Dist. Lexis 49172 at **20-21 (Dist. Ct. Nev. 2013). *2 Under Rule 69(a)(2), in order to obtain discovery from a nonparty, a judgment creditor must demonstrate the necessity and relevance of the discovery. The Trustees of the North Florida Operating Engineers Health and Welfare Fund v. Lane Crane Service, Inc., supra, 148 F.R.D. at 663. The plaintiff correctly asserts that it has demonstrated that the information is relevant and necessary in order to discover the defendant's assets. Here, Vanderford is the wife of the defendant and, clearly, under the circumstances of this case, the plaintiff should be permitted to seek discovery regarding her financial assets in determining if the defendant has assets to satisfy the thirty million dollar judgment that he has yet to pay. In this respect, the defendant and his wife do not dispute that the defendant has made no effort to pay the thirty million dollar judgment that has been entered against him (see Doc. 105). Therefore, the plaintiff may seek broad discovery from the defendant and nonparties in order to find assets to satisfy the judgment. Thus, the plaintiff asserts that it sent the defendant a financial statement regarding his assets and liabilities and those of his wife's in order to determine his ability to pay the judgment (see Doc. 116, p. 2). The plaintiff explains that the defendant returned an incomplete financial statement and that it “contained virtually no information about his spouse's financial information” (id.; Doc. 116-1, pp. 1-10).[2] Moreover, the plaintiff submits that the defendant's completed financial statement does not indicate that he and his wife are paying $6,700 in rent on a home that is paid by Vanderford and a company that the defendant claims that he no longer has operational control over (Doc. 116, p. 5; Doc. 116-5, Decl. Bonnie J. McGregor, pp. 3, 14). In other words, the defendant and his wife apparently have money to pay a high rent, yet, he has made no effort in satisfying the judgment. In any event, post judgment discovery is broad. Therefore, the plaintiff may utilize Rule 69(a)(2) to discover assets that the defendant may have transferred to others or concealed in order to avoid paying on the judgment. Thus, the plaintiff is entitled to use Fed.R.Civ.P. 45(a) in issuing a subpoena upon the defendant's nonparty wife in order to obtain her financial information. The plaintiff acknowledges that “there must be a threshold showing of the necessity and relevance of the discovery sought” from the nonparty. The Trustees of the North Florida Operating Engineers Health and Welfare Fund v. Lane Crane Service, Inc., supra, 148 F.R.D. at 664. As previously explained, discovery is broad under Rule 69, and the plaintiff may seek discovery pertaining to the judgment debtor's spouse's relevant financial information in determining the defendant's ability to pay on the thirty million dollar judgment. Indeed, courts permit discovery into a judgment debtor's spouse's financial information. See Credit Suisse Securities (USA) LLC v. Nash, 2014 WL 12585650 at *2 (S.D. Fla. 2014) (directing judgment debtor's spouse to respond to the plaintiff's subpoena to produce documents); STG Secure Trading Group, Inc. v. Solaris Opportunity Fund, LP, supra, 2007 U.S. Dist. Lexis 102645 at *4 (court explaining discovery is allowed into property jointly held and permitting inventory of judgment's debtor's home despite debtor's and debtor's wife's objections); United States v. Cimino, 219 F.R.D. 695, 696, 698 (N.D. Fla. 2003) (denying judgment debtor's and spouse's motion for protective order to quash subpoena duces tecum because there are no privacy rights concerning bank records and information provided suggested they had income, but judgment was unsatisfied). *3 Further, the plaintiff used the proper procedure set forth in Rule 45 in attempting to obtain discovery from Vanderford. See Credit Suisse Securities (USA) LLC v. Nash, supra, 2014 WL 12585650 at *7 (“The appropriate procedure to compel a non-party to produce documents is to serve the non-party with a subpoena as set forth in Rule 45.”). There is no doubt that it is necessary for the plaintiff to seek information regarding Vanderford's assets. As indicated, the defendant has made no attempt to pay any of the large judgment that has been entered against him. Moreover, the plaintiff explains that the defendant and his wife's finances are “inextricably intertwined” and, therefore, it “seeks mainly financial and other records such as ... bank accounts, loans, tax returns, and real estate records” (Doc. 116, p. 7). Consequently, it is necessary for the plaintiff to seek information regarding the defendant's wife's assets in order to determine if the defendant has the ability to pay the judgment. The defendant and his wife baldly assert that “no sufficient predicate has been laid to permit financial discovery of nonparty [Nevada Vanderford]” (Doc. 105, p. 2). Thus, they not only argue that the plaintiff must demonstrate that the information is necessary and relevant prior to the plaintiff being able to obtain information on “such an invasive request,” but that the plaintiff has not laid a proper predicate in obtaining the information (id.). However, the defendant and Vanderford concede that the plaintiff only needs to make a “slight showing” of a fraudulent transfer in order to obtain the financial information (id.). Despite this low threshold, the defendant and Vanderford submit that the plaintiff has not laid a proper predicate to obtain the information. In support of their argument, they assert that the plaintiff “must show that the relationship between the judgment debtor and the nonparty is sufficient to raise a reasonable doubt about the bona fides of the transfer of assets” (id.). The plaintiff acknowledges that it must demonstrate a “reasonable doubt” that the defendant has fraudulently transferred his assets (Doc. 116, p. 5). However, as set forth in the plaintiff's response memorandum, such a showing has been made (id., pp. 4-6). Thus, the plaintiff has raised a reasonable doubt that the defendant transferred assets in an attempt to conceal them from satisfying the judgment, including that the defendant is known for hiding assets in the past. As previously explained, the defendant did not indicate on the financial statement that a $6,700 monthly rent on his home is being paid by his wife and a company that he allegedly has no operational control over (Doc. 116-5, Decl. Bonnie J. McGregor, p. 3). Moreover, the plaintiff indicates that in 2015 and 2016, nonparty Vanderford deposited American Express Travelers checks totaling $14,400 that were apparently signed by defendant's dead mother (see Doc. 116, p. 5; Doc. 116-5, pp. 20-25). These circumstances certainly raise questions regarding the defendant's actions regarding finances. Accordingly, the plaintiff has met its low burden and has raised a reasonable doubt that the defendant may have fraudulently transferred or concealed his assets. The defendant and nonparty Vanderford also assert that she does not have to comply with the subpoena due to the marital privilege and, therefore, the privilege protects disclosure of the financial information (Doc. 105, pp. 3-4). The defendant and nonparty Vanderford assert a blanket privilege without identifying the requests that would be subject to the privilege, if one exists (see id.). Thus, the party asserting the privilege bears the burden of establishing that the privilege applies. See In the Matter of the Application of Galina Weber v. For Discovery From Lazar S. Finker, 2008 U.S. Dist. Lexis 31067 at *12 (M.D. Fla. 2008) (explaining that “[t]he party asserting a privilege has the burden to show that the privilege applies and that burden ‘can be met only by an evidentiary showing based on competent evidence, and cannot be ‘discharged by mere conclusory or ipse dixit assertions”) (internal citations omitted); CSX Transportation, Inc. v. Admiral Insurance Co., 1995 WL 855421 at *1, 1995 U.S. Dist. Lexis 22359 at *4 (M.D. Fla. 1995) (burden on the party asserting privilege to “establish those facts that are essential elements of the privileged relationship”) (internal quotations and citations omitted). Consequently, the defendant and his wife's motion can be denied on the basis that their conclusory assertion of a privilege does not explain how the document requests from the subpoena are covered by the marital privilege (see Doc. 105, pp. 3-4). *4 Thus, the defendant and nonparty Vanderford merely assert that their communications are protected by the marital privilege under § 90.504 of the Florida Statutes and, therefore, she need not comply with the subpoena (id., p. 4). However, as indicated, nonparty Vanderford only makes a blanket assertion that the privilege applies without indicating how each request falls under that privilege. Further, as correctly argued by the plaintiff, the marital privilege applies to communications (emphasis added), not to documents (Doc. 116, pp. 6-7) and, therefore, the marital privilege would not be applicable to the document requests. “There are two recognized types of marital privilege: the marital communications privilege and the spousal testimonial privilege.” United States v. Singleton, 260 F.3d 1295, 1297 (11th Cir. 2001). “Florida law determines whether the husband-wife privilege” applies in preventing the disclosure of information. Hanger Orthopedic Group, Inc. v. McMurray, 181 F.R.D. 525, 528 (M.D. Fla. 1998). In this respect, Rule 501 of the Federal Rules of Evidence provides that “in a civil case, state law governs privilege regarding a claim or defense for which state law supplies the rule of decision.” Thus, § 90.504, Fla. Stat. provides: (1) A spouse has a privilege during and after the marital relationship to refuse to disclose, and to prevent another from disclosing, communications which were intended to be made in confidence between the spouses while they were husband and wife. (2) The privilege may be claimed by either spouse or by the guardian or conservator of a spouse. The authority of a spouse, or guardian or conservator of a spouse, to claim the privilege is presumed in the absence of contrary evidence. The marital privilege “does not apply to communications made in the presence of third parties, and generally applies only to utterances, not acts.” United States v. Abram, 171 Fed. Appx. 304, 310 (11th Cir. 2006). Consequently, to the extent the plaintiff seeks documents regarding financial assets, they are not communications that would be protected by the marital privilege. See G-Fours, Inc. v. Miele, 496 F.2d 809 (2nd Cir. 1974) (judgment debtor's wife could not utilize marital privilege in refusing to answer interrogatories propounded by judgment debtor in determining the husband's assets). As indicated, the defendant and his wife have not indicated which discovery requests would be protected by the privilege. Indeed, with respect to the plaintiff's request regarding bank records “[t]here is no privacy interest in bank records...” United States v. Cimino, supra, 219 F.R.D. at 696. Accordingly, the plaintiff is entitled to post judgment discovery of Vanderford's financial assets. The plaintiff indicates that specification number 19 of the subpoena, “could be potentially [subject to the marital] privilege[ ]” but, asserts that the privilege does not apply to conversations regarding crimes a marital couple are jointly participating in or to the concealment of assets (Doc. 116, pp. 7-8). Number 19 requests (Doc. 116-2, p. 9): All communications between you and Nicholas Congleton regarding any financial transactions, including accumulating, locating, investing, protecting, converting, or transferring of income or assets. Despite the defendant's and wife's conclusory assertion of a marital privilege, this request will be denied because it is seeking communications between the defendant and his wife. Moreover, this is a civil case and not a criminal one and, therefore, the assertion that information is not protected due to a criminal act has not been demonstrated here. *5 It is, therefore, upon consideration, ORDERED: That the Defendant Congleton's Motion to Quash Subpoena Duces Tecum (Doc. 105) be, and the same is hereby, DENIED. Nonparty Nevada Vanderford must comply with the subpoena within twenty days of this Order, but she does not have to answer document request number 19. DONE and ORDERED at Tampa, Florida, this 14th day of April, 2017. Footnotes [1] Florida Rule Civil Procedure 1.560(a) provides: In aid of a judgment, decree, or execution the judgment creditor or successor in interest, when the interest appears of record, may obtain discovery from any person, including the judgment debtor, in the manner provided in these rules. Florida Rule Civil Procedure 1.560(d) provides: In any final judgment, if requested by the judgment creditor, the court shall include the additional Spouse Related Portion of the fact information sheet upon a showing that a proper predicate exists for discovery of separate income and assets of the judgment debtor's spouse. [2] For example, according to the financial information document the defendant completed, he indicated that he only has cash on hand of $500, a balance of zero on two bank accounts, $400 balance in another bank account, and an “unknown” amount in a bank account because he “can't login” (Doc. 116-1, p. 4). The defendant also listed “none” regarding information pertaining to “Non-Public Business and Financial Interests,” “Amounts Owed To You, Your Spouse, or Your Dependents,” “Life Insurance Policies,” “Deferred Income Arrangements,” and “Pending Insurance Payments or Inheritances” (id., pp. 5-6).