HAWORTH COUNTRY CLUB, LLC, et al. v. Peter A. GIORGIO, Jr., et al NO. X07-HHD-CV19-6134953-S Superior Court of Connecticut, J.D. OF HARTFORD AT HARTFORD June 07, 2023 Noble, Cesar A., Judge MEMORANDUM OF DECISION RE MOTIONS TO QUASH, ## 207 & 211 UNPUBLISHED OPINION. CHECK COURT RULES BEFORE CITING. *1 Before the court are the motions to quash several subpoenas duces tecum served on Bank of America and Webster Bank for records related to several parties: Peter Giorgio and James Giorgio (defendants); and nonparty entities, Newberry Village Holdings, LLC (NVH); Newberry Village, LLC (NV); G-III Holdings, LLC (G III); Global Logistics Solutions, LLC (GLS, LLC); and Peter A. Giorgio, Jr. d/b/a Global Logistics Solutions, Inc. (GLS Inc.) (collectively, the subjects), which the defendants own. For the following reasons, the motions are granted in part and denied in part. This case arises out of the construction of the final phase of the Newberry Village real estate project in East Windsor, Connecticut. The plaintiff, Haworth Country Club, LLC (Haworth), and the defendants, Peter and James Giorgio, comprise the membership of Newberry Holdings Village, LLC. Haworth brought the present action individually and derivatively on behalf of NVH and seeks, relevantly, damages for self-dealing, misappropriation and/or conversion of NVH's assets and alleges bad faith, civil theft, and breach of fiduciary duty. Although not specifically alleged in the present complaint, the court takes judicial notice of the allegations contained in the complaint of a companion case[1] in which Haworth alleges that it loaned sums to NVH with a balance due of $4,000,000, and that the defendants have engaged in conduct to convey the assets of NVH to other entities in order to avoid repaying the latter's loan obligations. The plaintiff has served subpoenas on Webster Bank and Bank of America for records of their account holders, the subjects and the defendants. As represented at oral argument, Haworth and the defendants continue to work together in an effort to sell individual homes in the project. G III operates as the contractor for the building of the homes. GLS, LLC and GLS Inc. were represented at oral argument to be solely owned by Peter Giorgio and to have no connection or participation in the business of NVH. The parties agree that Haworth has issued serial subpoenas duces tecum to Bank of America and Webster Bank to obtain “all bank statements, checks front and back, each withdrawal of money, all deposits, opening of each account, all Communications” for each subject. While none of the subjects objected to prior identical subpoenas, GLS, LLC and GLS Inc., filed motions to quash subpoenas duces tecum for records from September 1, 2022 to November 28, 2022, and from November 1, 2022 to January 9, 2023. (## 207 and 211). No objection was raised to the production of the bank records relating to NVH, NV or G III and the court previously ordered those produced based on the lack of an objection. See # 211.86. The defendants and subjects do not contest the legality of the subpoenas, nor that they were properly served with the subpoenas ten days prior to the date noticed for production. The defendants and GLS, LLC and GLS Inc. object to the production of the records on the grounds that they are irrelevant and immaterial to the claims presented by Haworth. At oral argument, Haworth conceded that any bank accounts maintained jointly by the defendants with their children and/or wives were to be excluded from the scope of the subpoenas duces tecum. No evidence was presented on the date of argument nor did the plaintiff offer any evidence in the form of affidavits. *2 The movants assert that, pursuant to General Statutes § 36a-43,[2] the burden of establishing the materiality of the records is borne by Haworth. The court agrees. See Blue Cross & Blue Shield of Connecticut, Inc. v. Reuter, Superior Court, judicial district of New Haven, Docket No. 261011, 1990 WL 288638, *2 (April 6, 1990, Gormley, J.) (1 Conn. L. Rptr. 460). (“[T]he burden of going forward at the hearing and of establishing the relevancy of the bank records is upon the party seeking these records.”) “[Section] 36–9l(b) [now § 36a-43(b] was enacted to afford a bank customer the opportunity to contest the validity of those inquiries about his bank records for which he had been entitled to receive notice under § 36–9l (a) as originally enacted. Armed with notice under § 36–9l(a) and a right to a hearing under § 36–9l(b), a customer has standing to challenge the substantive propriety of the disclosure of his records, on grounds such as ... that there is no authority for the issuance of the subpoena; or that the customer's financial records are immaterial to the investigation.” (Citation omitted; emphasis added.) Morgan v. Brown, 219 Conn. 204, 211, 592 A.2d 925 (1991). Whether a customer's financial records are material in a civil action depends on whether they may serve to prove those facts directly in issue or those probative of matters in issue. E. Prescott, Tait's Handbook of Connecticut Evidence (6th Ed. 2019), § 4.1.3., Materiality, p. 144. “The material issues are framed by the pleadings.” Id., p. 145. In the present case, the plaintiff has alleged bad faith by self-dealing, misappropriation and/or conversion as well as civil theft by withholding assets with the intent to deprive the plaintiff of assets or appropriate the same to a third party. Counts 4 and 5. Moreover, in the context of civil discovery, the movant's burden is simply to demonstrate that the information sought appears reasonably calculated to lead to the discovery of admissible evidence. Practice Book § 13-2. Mindful of the above principles, the court finds that the bank records sought are material to the allegations of the plaintiff's complaint and are reasonably calculated to lead to the discovery of admissible evidence. The bank account records sought are either in the name of the defendants or in the names of corporate entities owned by or controlled by the defendants. The court therefore denies the motion as to the subjects and defendants but grants the motion to quash as to any bank accounts maintained jointly by the defendants with their children and/or wives. Footnotes [1] Haworth Country Club, LLC v. Newberry Village Holdings, LLC, Superior Court, judicial district of Hartford, Complex Litigation Docket, X07-CV-196134954S. [2] Section 36a-43 (formerly § 36-9) provides in relevant part that “(a) Except as provided in section 36a-44, a financial institution shall disclose financial records pursuant to a lawful subpoena, summons, warrant or court order served upon it if the party seeking the records causes such subpoena, summons, warrant or court order or a certified copy thereof to be served upon the customer whose records are being sought, at least ten days prior to the date on which the records are to be disclosed .... (b) A customer of a financial institution shall have standing to challenge a subpoena of the customer's financial records, by filing an application or motion to quash in a court of competent jurisdiction. Upon the filing of such application or motion by the customer, and service of such application or motion upon the financial institution and the person issuing the subpoena, production of the records shall be stayed, without liability to the financial institution, until the court holds a hearing on the motion or application and an order is entered sustaining, modifying or quashing the subpoena....”