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Case 1:15-cv-07433-LAP Document 1219-22 Filed 07/15/21 Page 1 of 22
United States District Court
Southern District of New York
Virginia L. Giuffre,
Plaintiff, Case No.: 15-cv-07433-RWS
v.
Ghislaine Maxwell,
Defendant.
________________________________/
PLAINTIFFâS RESPONSE IN OPPOSITION TO DEFENDANTâS MOTION FOR
PROTECTIVE ORDER REGARDING FINANCIAL INFORMATION
Plaintiff, Virginia Giuffre, by and through her undersigned counsel, files this Response in
Opposition to Defendantâs Motion for a Protective Order Regarding Financial Information (DE
370). Defendantâs financial information is highly relevant to this case, particularly in light of
Ms. Giuffreâs punitive damages claim as well as press reports suggesting that the Defendant may
be selling her assets in New York and transferring the money outside the jurisdiction.
Accordingly, Defendantâs motion for a protective order should be denied.1
I. PRELIMINARY STATEMENT
As recounted by Defendant (DE 370 at 1-3), Ms. Giuffre has served discovery requests
on Defendant, seeking certain financial information from the Defendant. The requests are
narrowly tailored to the time frame related to this case, as the requested information concerns
1
Contemporaneous with the filing of this response to Defendantâs motion for a protective order
regarding financial information, Ms. Giuffre has also filed a motion to compel Defendant to
produce the requested financial information. This parallel filing is apparently required because
Ms. Giuffre does not simply seek the negative relief of denial of Defendantâs requested
protective order but also the affirmative relief of a Court order requiring production of the
materials.
1
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financial information from just the time during which Defendant has defamed Ms. Giuffre (2015
to present).
As with most of the other discovery requests she has received, Defendant has chosen not
to produce any information. Instead, she has filed this motion for a blanket protective order,
arguing that financial discovery has no relevance whatsoever to any issue in this case. Of course,
given the broad scope of discovery, the Court can grant Defendantâs motion only if no relevance
exists at all. But in fact, Defendantâs financial information is highly relevant to at least three
issues in this case. First, Defendantâs recent efforts to conceal assets from the reach of this Court
proves consciousness of her guilt of sex trafficking. Second, Defendantâs financial affairs will
show dependence on Epstein for financial support, an issue highly relevant to motive.2 Third, as
Defendant herself appears to admit, the discovery is relevant to the size of the punitive damage
award that the jury should enter in this case. Facts relevant to each of these three points are set
out in order below.
A. Discovery of Financial Information is Relevant to Show Defendantâs
Transfer of Assets Out of the Jurisdiction after the Commencement of
Litigation and thus Her Consciousness of Guilt.
The requested financial information is relevant to issues relating to Defendantâs apparent
attempt to conceal assets from the Court. The timing of recent events is telling here. As the
Court will recall, in court pleadings filed December 30, 2014, Ms. Giuffre initially publicly
alleged Defendant had sexually abused her. On September 21, 2015, Ms. Giuffre filed her
lawsuit against Defendant here in the Southern District of New York. (DE 1.) Ms. Giuffre is
seeking at least $50 million in compensatory and punitive damages from Ms. Maxwell. Just a
few months after the suit was filed, on April 28, 2016, the New York Post reported that
2
As recently as 2005, Defendant was on Epsteinâs Palm Beach House bank account for Palm
Beach. Bates Number SAO FOIA disc 7 (bates Giuffre 007590) at p. 93-95.
2
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Defendant, âthe daughter of the late disgraced press baron Robert Maxwell, has sold her
townhouse at 116 E. 65th St. for $15 million.â See http://nypost.com/2016/04/28/alleged-epstein-
madam-sells-16m-manhattan-townhouse/. When questioned about the sale, Defendantâs
representative refused to comment. See id. (broker Shari Scharfer Rollins, of Douglas Elliman,
did not return calls).
The transfers of assets, likely out of the jurisdiction of this Court, provides evidence of
consciousness of criminal guilt and civil liability. Clearly, Ms. Giuffre is entitled to explore all
the circumstances surrounding the timing and consummation of this sale, including whether
Defendant has now secreted these assets someplace where they may be difficult to reach, such as
in the United Kingdom (where, on information and belief, Maxwell is a UK citizen holding a UK
passport) or elsewhere.
Maxwellâs removal and apparent concealment of assets takes place against a backdrop of
disregard of court orders by Maxwell and others involved in the Epstein sex trafficking
organization. In 2009, before suit was ever filed in this case, Maxwell was served with a
subpoena for a deposition in a civil case against Jeffrey Epstein. After extensive discussion and
coordinating a convenient time and place, as well as ultimately agreeing to a confidentiality
agreement prepared by Maxwellâs attorney, at the eleventh hour Maxwellâs attorney informed
plaintiffâs counsel that Maxwellâs mother was very ill and that consequently Maxwell was
leaving the country with no plans to return. The deposition was cancelled.
Similarly, the Court is familiar with the long (and still on-going) effort of Ms. Giuffreâs
efforts to take the depositions of those who participated with Defendant in sexual abuse --
3
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including Jeffrey Epstein, Nadia Marcikova, and Sarah Kellen â depositions that have thus far
been defeated by evasions of service of process and other similar maneuvers. See DE 160,
Motion for Leave to Serve Three Deposition Subpoenas by Means Other than Personal Service,
which this Court granted on June 20, 2016; DE 308, Motion for Finding Civil Contempt against
Sarah Kellen for Ignoring Subpoena (pending); DE 310, Motion for Finding of Civil Contempt
against Nadia Marcinkova for Ignoring Subpoena (pending). Similarly, the Court will recall that
Ms. Giuffre was recently forced to resort to the Hague Convention in an effort to depose
Maxwellâs spokesman, Ross Gow, about statements he made on Defendantâs behalf. See DE
306, Motion for Extension of Time to Complete Discovery to Serve and Depose Ross Gow
(pending); DE 330 and 331, Application for Letters Rogatory (application granted and letter
issued by the Court on August 11, 2016 (DE 358)).
Against the backdrop of these repeated evasion efforts, Defendantâs sale of $15 million in
assets appears even more alarming. And, evidence of consciousness of guilt is admissible in
criminal cases, even where the standard of proof is much higher than in a civil case. See, e.g.,
United States v. Amuso, 21 F.3d 1251, 1258 (2d Cir. 1994) (recognizing admissibility of
evidence from which a jury could find consciousness of guilt). Ms. Giuffre it entitled to explore
all the circumstances surrounding Ms. Maxwellâs apparent efforts to hide assets.3
B. Discovery of Financial Information is Relevant to Show a Financial Link to
Epstein.
In addition to providing evidence Defendant is hiding assets, the financial information
will help to establish an important link between Defendant and Jeffrey Epstein. Drawing again
3
The Court should review Defendantâs reply to this pleading carefully to see if she represents to
the Court that the $15 million in assets she has apparently concealed will be made available to
satisfy any judgment that Ms. Giuffre might obtain in this case. If Defendant fails to make such
a representation, the Court can draw the obvious inference that Defendant is attempting to hide
her assets to escape responsibility for paying any ultimate judgment here.
4
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on a published article from the New York Post, it appears that Defendantâs townhouse (among
other assets) might be part of a covert payoff from Epstein to Defendant. As the Post reports,
â[a] lawyer with links to Epstein reportedly bought the townhouse for Maxwell, who has
allegedly never earned enough or inherited enough to make the purchase on her own.â
http://nypost.com/2016/04/28/alleged-epstein-madam-sells-16m-manhattan-townhouse/. This
article suggests that Defendant is reliant upon Epstein for tremendous financial support, which
certainly provides a strong motive for her to provide favors to Epstein â including providing him
with underage girls for sex. It also provides a strong motive for her to lie at trial about Epsteinâs
(and her own) sex trafficking. Indeed, to conceal these facts, other media reports suggest that
the reason that Defendant was trying to sell her townhouse âquietlyâ was perhaps âto put some
distance between herself and Epstein, who owns a mansion a few blocks away.â
http://pagesix.com/2015/02/02/accused-epstein-madam-quietly-selling-ues-townhouse/.
Again, perhaps there is some innocent explanation for these secretive efforts. But, if so,
Defendant has declined to provide it. See id. (noting Defendantâs ârep didnât commentâ).
C. Discovery of Financial Information is Relevant to the Issue of the Size of any
Punitive Damages.
Financial information regarding Defendant is also highly relevant to Ms. Giuffreâs
punitive damages claim. Of course, it is well-settled law that âevidence of a tortfeasorâs wealth
is traditionally admissible as a measure of the amount of punitive damages that should be
awarded.â City of Newport v. Fact Concerts, Inc., 453 U.S. 247, 270 (1981). As explained by
the Reporters of the American Law Instituteâs Restatement of Torts, when considering the size of
punitive damages â[t]he wealth of the defendant is also relevant, since the purposes of exemplary
damages are to punish for a past event and to prevent future offenses, and the degree of
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punishment or deterrence resulting from a judgment is to some extent in proportion to the means
of the guilty person.â Restatement (Second) of Torts § 908, cmt. e (1979).
Defendant does not attempt to quarrel with the proposition that her vast wealth is relevant
to Ms. Giuffreâs punitive damages claim. See, e.g., DE 370 at 6 (citing case allowing
information about a defendantâs wealth to be presented to the jury). Instead, it appears that her
only argument concerns the timing of the disclosure of such information, an issue discussed
below. For purposes of setting out the salient facts, then, it is enough to note here that even
Defendant has to ultimately concede that discovery about her financial information is relevant to
this case.
II. DISCUSSION
Because discovery regarding Defendantâs financial circumstances and recent transactions
is relevant to this case for multiple reasons, Ms. Giuffre is entitled to discovery regarding that
information. Under Federal Rule of Civil Procedure 34(a), a party may request that another
party produce documents in her possession so long as the documents are within the scope of Fed.
R. Civ. P. 26(b), which allows for broad discovery regarding any non-privileged matter that is
relevant to any partyâs claim or defense. Information within this scope of permitted discovery
need not be admissible in evidence to be discoverable. Relevance is still to be âconstrued
broadly to encompass any matter that bears on, or that reasonably could lead to other matter that
could bear onâ any party's claim or defense. State Farm Mut. Auto. Ins. Co. v. Fayda, No.
14CIV9792WHPJCF, 2015 WL 7871037, at *2 (S.D.N.Y. Dec. 3, 2015) (granting motion to
compel). For reasons explained above, the financial information sought is relevant to issues in
this case, and, accordingly Defendantâs motion for a protective order should be denied. There is
also no sound reason for delaying discovery on these issues.
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A. Discovery of Financial Information is Appropriate Pre-Trial to Avoid the
Need to Summon Two Separate Juries to Hear the Evidence in the Case.
Seemingly recognizing the fact that discovery regarding her financial information is
appropriate, Defendantâs ultimate argument appears not to be that the discovery is improper, but
rather that it should be delayed until after the trial starts. Thus, Defendantâs first specific
argument section is that financial âdiscovery is not appropriate pre-trial.â DE 370 at 6. In
support of this proposition, Defendantâs lead citation is a forty-year-old New York case, Rupert
v. Sellers, 48 A.D.2d 265 (4th Dept. 1975). But as much more recent authority from the Southern
District of New York explains, Rupert is inapplicable to discovery issues because the case relates
solely to the sequence with which evidence can be produced at trial:
[Defendantâs] reliance on Rupert v. Sellers, 48 A.D.2d 265, 368 N.Y.S.2d 904
(4th Depât 1975), for the proposition that punitive damages discovery is not
appropriate until a plaintiff has first established liability is misguided since federal
law and not state law governs questions of procedure such as discoverability.
Hazeldine v. Beverage Media, Ltd., No. 94 Civ. 3466 (CSH), 1997 WL 362229, at
*3 (S.D.N.Y. June 27, 1997) (citations omitted). Moreover, while the Second
Circuit âhas cited Rupert with approval, it has done so for the proposition that
evidence of a defendant's wealth should not âbe brought out at trial unless and
until the jury has brought in a special verdict that the plaintiff is entitled to
punitive damages.â â Id. (citations omitted). It has not held that financial
discovery such as that sought here may only be taken after a liability
determination.
Pasternak v. Dow Kim, 275 F.R.D. 461, 463 (S.D.N.Y. 2011).
Defendant also cites another decision from this court, Collens v. City of New York, 222
F.R.D. 249, 254 (S.D.N.Y. 2004). DE 370 at 7. But Collens does not stand for the proposition
that financial discovery is broadly barred, but only that on the facts of that case no such
discovery was required. As a recent case from the District of New Jersey explains in allowing
pre-trial discovery of financial information for punitive damages purposes:
Defendants assert that until there has been a finding of liability by the jury,
punitive damage discovery is not appropriate. Defendants rely on Collens, where
the court stated that because the issue of punitive damages is generally bifurcated
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from issues of liability, and punitive damages issues thus may never arise,
punitive damage discovery was not necessary at the pretrial stage. See Collens,
222 F.R.D. at 254. Plaintiffs assert that the same jury will decide both liability and
punitive damages issues and that, as a practical matter, there is no time to conduct
discoveryâincluding depositions of the individual police officersâbetween the
liability verdict and the charge to the jury on punitive damages. Plaintiffs' counsel
represented at oral argument that if Defendants are concerned with maintaining
the confidentiality of the individual police officer defendants' personal
information, Plaintiffs will agree to a confidentiality order and the sealing of those
portions of the deposition transcripts and documents that disclose such
information until such time as there is a finding of liability, if any, as to the
individual police officer defendants. . . . Insofar as Plaintiffs assert a claim under
42 U.S .C. § 1983, the Court notes that âevidence of a tortfeasor's wealth is
traditionally admissible as a measure of the amount of punitive damages that
should be awarded[.]â City of Newport v. Fact Concerts, Inc., 453 U.S. 247, 270
(1981). Therefore, interrogatories seeking information about Defendants' financial
condition are reasonably calculated to lead to the discovery of admissible
evidence on the issue of punitive damages.
Graham v. Carino, No. CIV.09-4501 JEI/AMD, 2010 WL 2483294, at *3 (D.N.J. June 4, 2010).
That pre-trial discovery on financial matters is allowed when a punitive damage issue is
present in a case is confirmed by Tillery v. Lynn, 607 F. Supp. 399, 402-03 (S.D.N.Y. 1985). To
leave the discovery until later would be burdensome on the jury â meaning that a common
approach is to allow financial discovery to proceed pre-trial and then to later bifurcate the trial
itself into liability and punitive damages phases:
Discovery as to defendant's personal assets may be undertaken by plaintiff at this
time. It would be unduly burdensome to plaintiff, and most particularly a jury and
the court, to delay resolution of the issue as to the amount of punitive damages, if
any, which should be awarded until discovery as to defendant's personal assets
had been completed. However, as the New York courts have recognized,
âdefendant's wealth should not be a weapon to be used by plaintiff to enable him
to induce the jury to find the defendant guilty of malice, thus entitling plaintiff to
punitive damages.â Rupert v. Sellers, 48 A.D.2d 265, 272, 368 N.Y.S.2d 904, 912
(4th Dep't 1975). Accord, Chilvers v. New York Magazine Company, Inc., 114
Misc.2d 996, 453 N.Y.S.2d 153 (N.Y.Co.Sup.Ct.1982). Accordingly, in the
interest of justice and to avoid any undue prejudice during the liability phase of
this action, the trial will be bifurcated. . . . Therefore, defendant's motions for
partial summary judgment and to stay discovery as to his financial status are
denied.
Tillery v. Lynn, 607 F. Supp. 399, 402-03 (S.D.N.Y. 1985) (Motley, J.).
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The holding in Tillery was endorsed in Hazeldine v. Beverage Media, Ltd., No. 94 CIV.
3466 (CSH), 1997 WL 362229, at *2-*3 (S.D.N.Y. 1997), which explainedâ âTillery followed
this preferred course by bifurcating the trial, see Simpson, 901 F.2d at 283, but allowing pre-trial
financial discovery to proceed.â Most cases in most jurisdictions outside the Southern District of
New York have reached exactly the same conclusion and allowed pre-trial discovery of financial
information for punitive damage purposes.4
4
See, e.g.:
ďˇ CEH, Inc. v. FV Seafarer, 153 F.R.D. 491 (D.R.I.1994) (plaintiffs were not required to
establish prima facie case on issue of punitive damages before they could obtain pretrial
discovery of financial information of defendants; plaintiffs had alleged facts sufficient to
make a non-spurious claim for punitive damages and that was sufficient to warrant
discovery);
ďˇ E.E.O.C. v. California Psychiatric Transitions, 258 F.R.D. 391 (E.D.Cal.2009)
(evidence of employer's current financial worth was relevant to issue of punitive
damages, and thus was discoverable in Title VII action alleging sexual harassment and
retaliation, where complaint sought punitive damages, deposition evidence indicated that
employer may have acted in reckless disregard of female employees' federal rights, and
privacy concerns could be addressed with protective order);
ďˇ Grosek v. Panther Transp., Inc., 251 F.R.D. 162 (M.D. Pa. 2008) (there was no good
cause to issue protective order preventing discovery of defendantsâ financial condition
until determination was made that punitive damages were warranted; plaintiffs stated
claim for punitive damages, and delaying discovery until after discovery of evidence
supporting punitive damages would have been inefficient and delayed conclusion of the
case);
ďˇ Vieste, LLC v. Hill Redwood Dev., No. C-09-04024 JSW DMR, 2011 WL 855831, at *1
(N.D. Cal. Mar. 9, 2011) (allowing pre-trial discovery of Defendants' net worth and
financial condition because it was clearly relevant to the issue of punitive damages);
ďˇ Charles O. Bradley Trust v. Zenith Capital, LLC, 2005 WL 1030218, at *3 (N.D.Cal.
May 3, 2005) (while some federal courts have required a prima facie showing of
entitlement to punitive damages before ordering discovery, the majority have not and
listing cases);
ďˇ In re Aqua Dots Products Liability Litigation, 270 F.R.D. 322 (N.D. Ill. 2010), aff'd,
654 F.3d 748 (7th Cir. 2011) (plaintiffs' discovery regarding financial information from
manufacturer and distributor of recalled children's toy was discoverable in a product
liability action. Plaintiffs sought punitive damages, and the distributor and manufacturer
were arguably principal actors);
ďˇ Oakes v. Halvorsen Marine Ltd., 179 F.R.D. 281 (C.D. Cal. 1998) (because defendants
asserted a counterclaim seeking punitive damages, they could obtain discovery regarding
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Defendant also cites a decision from Judge Cote in Tyco Intern. Ltd. v. Walsh, which
allowed a delay in seeking discovery of financial information in that case because it was not
clear if the issue would become relevant. But that case involved peculiar circumstances, which
permitted discovery of financial information to be bi-furcated without any burden on the Court.
Specifically, that case involved a bench trial, which allowed a delay between the liability phase
and punitive damages phases of the trial. As the Court explained. âit would be premature to
force the defendant to produce his net worth information at this time. If necessary, plaintiff will
have an opportunity to obtain discovery on the defendant's financial circumstances as part of any
post-trial discovery. Since the trial in this matter is a bench trial, no jury will be burdened by any
delay occasioned by this discovery period.â Tyco Int'l Ltd. v. Walsh, No. 02-CV-4633 (DLC),
2010 WL 3000179, at *1 (S.D.N.Y. July 30, 2010).
Of course, exactly the opposite situation exists here. Defendant would apparently have
the Court delay until the jury returns with its verdict in favor of Ms. Giuffre before allowing
discovery to proceed on Defendantâs financial circumstances. As a practical matter, this would
seem to require sending the jury empaneled to hear liability issues home and then selecting a
new, second jury on punitive damages issues â a new jury which would have to somehow be
shown all of the previous testimony from the liability phase. See Hazeldine v. Beverage Media,
Ltd., No. 94 CIV. 3466 (CSH), 1997 WL 362229, at *2-*3 (S.D.N.Y. 1997) (âallowing pre-trial
plaintiffs' net worth; California limitations on such discovery did not apply in federal
court);
ďˇ Caruso v. Coleman Co., 157 F.R.D. 344 (E.D. Pa. 1994) (âIn products liability action,
plaintiffs would be allowed discovery of defendantsâ financial statements and total sales
revenue on the ground they are relevant to the issue of punitive damages; information
regarding punitive damages is as discoverable as information that relates to liability, and
discovery could proceed without prior proof of prima facie case on punitive damages.â).
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discovery [of financial information] avoids the inefficiency of a discovery delay between the
liability and damages phases of trial, as well as the need to assemble a second jury.â).
Finally, Defendant relies upon Guccione v. Flynt, for the proposition that financial
discovery is not appropriate on punitive damages issues here. But that case was sui generis with
peculiar facts that render it inapplicable here. See Guccione v. Flynt, No. 83 CIV. 8020 RWS,
1985 WL 255, at *1 (S.D.N.Y. Feb. 6, 1985) (âIt should be apparent to anyone forced to review
these papers and the issues presented by this action that two men with ample resources are
employing lawyers and occupying space and time in the justice system to continue their personal
feud. Regrettably there is to date no apparent basis to avoid the unappetizing task of ruling on
these motions.â). Moreover, in that case, the Court in fact ordered the Defendant to produce
financial information to be turned over to plaintiffâs counsel at the time of trial. See id. at 1.
While that solution may have worked well in that case, it is not satisfactory here. Defendant is
not an established businessperson with regularly-kept disclosure statements reporting income and
related financial information. Instead, Defendant is participant in a covert, sex trafficking
organization with mysterious financial arrangements and apparent, recent efforts to conceal
assets. In such circumstance, Ms. Giuffre is not required to take the Defendantâs net worth
statement at face value, but instead is entitled to receive it well in advance of trial so that she
may investigate its accuracy.
Finally, this Court has previously rejected exactly the same arguments that are being
made here. This Court explained that â[w]hile bifurcation may be the preferred method of
resolving disputed issues of liability and damages, as it prevents prejudice to the defendants by
keeping financial evidence out of the liability phase of the trial, this does not mean that plaintiffs
should be denied pretrial financial discovery.â Hamm v. Potamkin, No. 98 CIV. 7425 (RWS),
1999 WL 249721, at *2 (S.D.N.Y. Apr. 28, 1999). This Court explained that â[a]s far as the
11
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clear-cut as to deprive Ms. Giuffre of her right to jury trial borders on frivolous. Ms. Giuffre is a
courageous young woman who has come forward to reveal the broad dimensions of a sex
trafficking ring â a criminal conspiracy that involved Defendant. That fact, alone, is enough to
send the issue of damages to Ms. Giuffreâs reputation to a jury, particularly because any other
approach would ârequire[] the Court to make factual findings regarding plaintiff's reputation for
a particular trait.â Church of Scientology Int'l v. Time Warner, Inc., 932 F. Supp. 589, 594
(S.D.N.Y. 1996) (refusing to grant summary judgment on a libel proof plaintiff argument), aff'd
238 F.3d 168 (2d Cir. 2001); see also id. citing Liberty Lobby, Inc. v. Anderson, 746 F.2d 1563,
1568 (D.C. Cir. 1984) (âTo begin with, we cannot envision how a court would go about
determining that someone's reputation had already been âirreparablyâ damagedâi.e., that no new
reader could be reached by the freshest libelâ (Scalia, J.) (emphasis in original)), vacated on
other grounds, 477 U.S. 242 (1986).
Defendant also predicts that Ms. Giuffre will âhave a nearly insurmountable task to
demonstrate that [Defendant] acted with the requisite degrees of malice.â DE 370 at 10
(emphasis added). Of course, the qualifier gives away the game â a ânearlyâ insurmountable
task is not one on which summary judgment is appropriate. And, in any event, once Ms. Giuffre
proves at trial (as she will) that Defendant was deeply involved in Epsteinâs sex trafficking ring,
it becomes obvious that Defendantâs attacks on Ms. Giuffreâs credibility were uttered with
malice. Defendant knew full well, for example, that Ms. Giuffreâs statements that Defendant
was involved in Epsteinâs sex trafficking were not âobvious lies.â She knew that because she
had been involved in (among other things) procuring multiple underage girls for Epstein to
sexually abuse10 â including Ms. Giuffre herself.
10
See Message Pads concerning Defendant (GIUFFRE001523; GIUFFRE001427;
GIUFFRE001451; GIUFFRE001454; GIUFFRE001460; GIUFFRE001461; GIUFFRE001464;
14
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III. DISCOVERY OF DEFENDANTâS FINANCIAL INFORMATION SHOULD NOT
BE CONFINDED TO A NET WORTH STATEMENT.
Perhaps recognizing that it is inevitable that her financial information will be relevant in
this case, Defendant makes one last argument that discovery of financial information should be
âlimited to a sworn affidavit of net worth.â DE 370 at 13. Whatever may have been the
circumstance warranting limitations in other cases, the circumstances here make that approach
highly inappropriate. Once again, it is important to remember that this is not a case involving,
for example, a public-traded company with audited financial statements, or a situation involving
otherwise-incontestable financial information. Cf. Hamm v. Potamkin, No. 98 CIV. 7425
(RWS), 1999 WL 249721, at *3 (S.D.N.Y. Apr. 28, 1999) (for purposes of pre-trial punitive
damages discovery, directing corporate defendants âto produce a financial affidavit containing a
statement of its total net worth and listing its income, assets, and liabilities for the past three
yearsâ).
Instead, this case involves a shadowy criminal organization, involving a kingpin with vast
wealth (Jeffrey Epstein, a reported billionaire), and multi-million dollar transactions to others in
the organization such as Defendant (e.g., the apparent concealed transfer, through an attorney
associated with Epstein, of an apartment to Defendant worth, in 2015, $15,000,000). Given the
strong possibility of wrongdoing lurking here, a mere declaration of net worth promises to be
next to worthless. To provide a simple example, if Defendant were to testify at trial she had a
net worth of only ten million dollars â and not provide information about where she had hidden
the fifteen million dollars associated with the sale of her apartment â then Ms. Giuffre will have
little effective way to challenge the claim. Moreover, as noted above, the record is replete with
multiple examples of Defendant failing to recall obvious and highly incriminating facts. Given
Defendantâs amnesia about important events, it seems obvious that she may similarly be
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(DE 62). As this Court has previously explained, in allowing discovery of financial information
for punitive damage purposes, âany privacy interests defendants may have in confidential
financial information produced to plaintiffs can be secured by the protective order issued by this
Court.â Hamm v. Potamkin, No. 98 CIV. 7425 (RWS), 1999 WL 249721, at *2 (S.D.N.Y. Apr.
28, 1999). Nothing in Defendantâs motion establishes that Ms. Giuffre should be barred from the
kinds of ordinarily discovery that often accompanies cases in which the financial dealings of a
defendant are discoverable.
This argument is also belied by the fact that Defendant sought, and received, Ms.
Giuffreâs personal financial information. Specifically, she sought any payment information
relating to the media. See Defendantâs First Set of Requests for Production at No. 30. Ms.
Giuffre provided documents responsive to this request, which included her personal bank
records. Defendant takes the contradictory and self-serving position that discovery concerning
the personal finances of Ms. Giuffre is appropriate, yet discovery concerning her own finances is
somehow inappropriate.
At the very least, the Defendant should be required to produce a âstatement of [her] total
net worth and listing [her] income, assets, and liabilities for the [relevant] years,â as this Court
ordered in a previous case. Hamm v. Potamkin, No. 98 CIV. 7425 (RWS), 1999 WL 249721, at
*3 (S.D.N.Y. Apr. 28, 1999). But because that formulation came from an earlier case involving
reputable corporate entities with (apparently) audited financial statements, the discovery here
should be much broader â and should include all of the significant requests made by Ms. Giuffre.
For example, Defendant should also be required to identify all financial transactions involving
(directly or indirectly) Jeffrey Epstein, , Ellmax LLC, The TerraMar
Project, and any other person listed in the Rule 26 disclosures of either side in this case.
Transactions with potential witnesses in this case are highly relevant to bias and other trial
19
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issues. And because of concern that the Defendant is concealing assets, she should also be
required to reveal all significant (greater than $10,000) assets or other monetary transfers in since
the beginning of January 1, 2015, as well as all transfers of assets or money outside of this
Courtâs jurisdiction, including transfers overseas.
IV. CONCLUSION
Based upon the foregoing, Ms. Giuffre respectfully requests that this Court deny
Defendantâs motion for a protective order barring discovery into her financial situation. In a
contemporaneously-filed motion to compel, Ms. Giuffre also respectfully requests that the Court
grant a motion to compel Defendant to answer questions about her financial information.
Dated: August 22, 2016.
Respectfully Submitted,
BOIES, SCHILLER & FLEXNER LLP
By: /s/ Sigrid McCawley
Sigrid McCawley (Pro Hac Vice)
Meredith Schultz (Pro Hac Vice)
Boies Schiller & Flexner LLP
401 E. Las Olas Blvd., Suite 1200
Ft. Lauderdale, FL 33301
(954) 356-0011
David Boies
Boies Schiller & Flexner LLP
333 Main Street
Armonk, NY 10504
Bradley J. Edwards (Pro Hac Vice)
FARMER, JAFFE, WEISSING,
EDWARDS, FISTOS & LEHRMAN, P.L.
425 North Andrews Avenue, Suite 2
Fort Lauderdale, Florida 33301
(954) 524-2820
20
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Paul G. Cassell (Pro Hac Vice)
S.J. Quinney College of Law
University of Utah
383 University St.
Salt Lake City, UT 84112
(801) 585-520214
14
This daytime business address is provided for identification and correspondence purposes only
and is not intended to imply institutional endorsement by the University of Utah for this private
representation.
21
Case 1:15-cv-07433-LAP Document 1219-22 Filed 07/15/21 Page 22 of 22
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 22th day of August, 2016, I electronically filed the
foregoing document with the Clerk of Court by using the CM/ECF system. I also certify that the
foregoing document is being served this day on the individuals identified below via transmission
of Notices of Electronic Filing generated by CM/ECF.
Laura A. Menninger, Esq.
Jeffrey Pagliuca, Esq.
HADDON, MORGAN & FOREMAN, P.C.
150 East 10th Avenue
Denver, Colorado 80203
Tel: (303) 831-7364
Fax: (303) 832-2628
Email: [email protected]
[email protected]
/s/ Sigrid S. McCawley
Sigrid S. McCawley
22
United States District Court
Southern District of New York
Virginia L. Giuffre,
Plaintiff, Case No.: 15-cv-07433-RWS
v.
Ghislaine Maxwell,
Defendant.
________________________________/
PLAINTIFFâS RESPONSE IN OPPOSITION TO DEFENDANTâS MOTION FOR
PROTECTIVE ORDER REGARDING FINANCIAL INFORMATION
Plaintiff, Virginia Giuffre, by and through her undersigned counsel, files this Response in
Opposition to Defendantâs Motion for a Protective Order Regarding Financial Information (DE
370). Defendantâs financial information is highly relevant to this case, particularly in light of
Ms. Giuffreâs punitive damages claim as well as press reports suggesting that the Defendant may
be selling her assets in New York and transferring the money outside the jurisdiction.
Accordingly, Defendantâs motion for a protective order should be denied.1
I. PRELIMINARY STATEMENT
As recounted by Defendant (DE 370 at 1-3), Ms. Giuffre has served discovery requests
on Defendant, seeking certain financial information from the Defendant. The requests are
narrowly tailored to the time frame related to this case, as the requested information concerns
1
Contemporaneous with the filing of this response to Defendantâs motion for a protective order
regarding financial information, Ms. Giuffre has also filed a motion to compel Defendant to
produce the requested financial information. This parallel filing is apparently required because
Ms. Giuffre does not simply seek the negative relief of denial of Defendantâs requested
protective order but also the affirmative relief of a Court order requiring production of the
materials.
1
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financial information from just the time during which Defendant has defamed Ms. Giuffre (2015
to present).
As with most of the other discovery requests she has received, Defendant has chosen not
to produce any information. Instead, she has filed this motion for a blanket protective order,
arguing that financial discovery has no relevance whatsoever to any issue in this case. Of course,
given the broad scope of discovery, the Court can grant Defendantâs motion only if no relevance
exists at all. But in fact, Defendantâs financial information is highly relevant to at least three
issues in this case. First, Defendantâs recent efforts to conceal assets from the reach of this Court
proves consciousness of her guilt of sex trafficking. Second, Defendantâs financial affairs will
show dependence on Epstein for financial support, an issue highly relevant to motive.2 Third, as
Defendant herself appears to admit, the discovery is relevant to the size of the punitive damage
award that the jury should enter in this case. Facts relevant to each of these three points are set
out in order below.
A. Discovery of Financial Information is Relevant to Show Defendantâs
Transfer of Assets Out of the Jurisdiction after the Commencement of
Litigation and thus Her Consciousness of Guilt.
The requested financial information is relevant to issues relating to Defendantâs apparent
attempt to conceal assets from the Court. The timing of recent events is telling here. As the
Court will recall, in court pleadings filed December 30, 2014, Ms. Giuffre initially publicly
alleged Defendant had sexually abused her. On September 21, 2015, Ms. Giuffre filed her
lawsuit against Defendant here in the Southern District of New York. (DE 1.) Ms. Giuffre is
seeking at least $50 million in compensatory and punitive damages from Ms. Maxwell. Just a
few months after the suit was filed, on April 28, 2016, the New York Post reported that
2
As recently as 2005, Defendant was on Epsteinâs Palm Beach House bank account for Palm
Beach. Bates Number SAO FOIA disc 7 (bates Giuffre 007590) at p. 93-95.
2
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Defendant, âthe daughter of the late disgraced press baron Robert Maxwell, has sold her
townhouse at 116 E. 65th St. for $15 million.â See http://nypost.com/2016/04/28/alleged-epstein-
madam-sells-16m-manhattan-townhouse/. When questioned about the sale, Defendantâs
representative refused to comment. See id. (broker Shari Scharfer Rollins, of Douglas Elliman,
did not return calls).
The transfers of assets, likely out of the jurisdiction of this Court, provides evidence of
consciousness of criminal guilt and civil liability. Clearly, Ms. Giuffre is entitled to explore all
the circumstances surrounding the timing and consummation of this sale, including whether
Defendant has now secreted these assets someplace where they may be difficult to reach, such as
in the United Kingdom (where, on information and belief, Maxwell is a UK citizen holding a UK
passport) or elsewhere.
Maxwellâs removal and apparent concealment of assets takes place against a backdrop of
disregard of court orders by Maxwell and others involved in the Epstein sex trafficking
organization. In 2009, before suit was ever filed in this case, Maxwell was served with a
subpoena for a deposition in a civil case against Jeffrey Epstein. After extensive discussion and
coordinating a convenient time and place, as well as ultimately agreeing to a confidentiality
agreement prepared by Maxwellâs attorney, at the eleventh hour Maxwellâs attorney informed
plaintiffâs counsel that Maxwellâs mother was very ill and that consequently Maxwell was
leaving the country with no plans to return. The deposition was cancelled.
Similarly, the Court is familiar with the long (and still on-going) effort of Ms. Giuffreâs
efforts to take the depositions of those who participated with Defendant in sexual abuse --
3
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including Jeffrey Epstein, Nadia Marcikova, and Sarah Kellen â depositions that have thus far
been defeated by evasions of service of process and other similar maneuvers. See DE 160,
Motion for Leave to Serve Three Deposition Subpoenas by Means Other than Personal Service,
which this Court granted on June 20, 2016; DE 308, Motion for Finding Civil Contempt against
Sarah Kellen for Ignoring Subpoena (pending); DE 310, Motion for Finding of Civil Contempt
against Nadia Marcinkova for Ignoring Subpoena (pending). Similarly, the Court will recall that
Ms. Giuffre was recently forced to resort to the Hague Convention in an effort to depose
Maxwellâs spokesman, Ross Gow, about statements he made on Defendantâs behalf. See DE
306, Motion for Extension of Time to Complete Discovery to Serve and Depose Ross Gow
(pending); DE 330 and 331, Application for Letters Rogatory (application granted and letter
issued by the Court on August 11, 2016 (DE 358)).
Against the backdrop of these repeated evasion efforts, Defendantâs sale of $15 million in
assets appears even more alarming. And, evidence of consciousness of guilt is admissible in
criminal cases, even where the standard of proof is much higher than in a civil case. See, e.g.,
United States v. Amuso, 21 F.3d 1251, 1258 (2d Cir. 1994) (recognizing admissibility of
evidence from which a jury could find consciousness of guilt). Ms. Giuffre it entitled to explore
all the circumstances surrounding Ms. Maxwellâs apparent efforts to hide assets.3
B. Discovery of Financial Information is Relevant to Show a Financial Link to
Epstein.
In addition to providing evidence Defendant is hiding assets, the financial information
will help to establish an important link between Defendant and Jeffrey Epstein. Drawing again
3
The Court should review Defendantâs reply to this pleading carefully to see if she represents to
the Court that the $15 million in assets she has apparently concealed will be made available to
satisfy any judgment that Ms. Giuffre might obtain in this case. If Defendant fails to make such
a representation, the Court can draw the obvious inference that Defendant is attempting to hide
her assets to escape responsibility for paying any ultimate judgment here.
4
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on a published article from the New York Post, it appears that Defendantâs townhouse (among
other assets) might be part of a covert payoff from Epstein to Defendant. As the Post reports,
â[a] lawyer with links to Epstein reportedly bought the townhouse for Maxwell, who has
allegedly never earned enough or inherited enough to make the purchase on her own.â
http://nypost.com/2016/04/28/alleged-epstein-madam-sells-16m-manhattan-townhouse/. This
article suggests that Defendant is reliant upon Epstein for tremendous financial support, which
certainly provides a strong motive for her to provide favors to Epstein â including providing him
with underage girls for sex. It also provides a strong motive for her to lie at trial about Epsteinâs
(and her own) sex trafficking. Indeed, to conceal these facts, other media reports suggest that
the reason that Defendant was trying to sell her townhouse âquietlyâ was perhaps âto put some
distance between herself and Epstein, who owns a mansion a few blocks away.â
http://pagesix.com/2015/02/02/accused-epstein-madam-quietly-selling-ues-townhouse/.
Again, perhaps there is some innocent explanation for these secretive efforts. But, if so,
Defendant has declined to provide it. See id. (noting Defendantâs ârep didnât commentâ).
C. Discovery of Financial Information is Relevant to the Issue of the Size of any
Punitive Damages.
Financial information regarding Defendant is also highly relevant to Ms. Giuffreâs
punitive damages claim. Of course, it is well-settled law that âevidence of a tortfeasorâs wealth
is traditionally admissible as a measure of the amount of punitive damages that should be
awarded.â City of Newport v. Fact Concerts, Inc., 453 U.S. 247, 270 (1981). As explained by
the Reporters of the American Law Instituteâs Restatement of Torts, when considering the size of
punitive damages â[t]he wealth of the defendant is also relevant, since the purposes of exemplary
damages are to punish for a past event and to prevent future offenses, and the degree of
5
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punishment or deterrence resulting from a judgment is to some extent in proportion to the means
of the guilty person.â Restatement (Second) of Torts § 908, cmt. e (1979).
Defendant does not attempt to quarrel with the proposition that her vast wealth is relevant
to Ms. Giuffreâs punitive damages claim. See, e.g., DE 370 at 6 (citing case allowing
information about a defendantâs wealth to be presented to the jury). Instead, it appears that her
only argument concerns the timing of the disclosure of such information, an issue discussed
below. For purposes of setting out the salient facts, then, it is enough to note here that even
Defendant has to ultimately concede that discovery about her financial information is relevant to
this case.
II. DISCUSSION
Because discovery regarding Defendantâs financial circumstances and recent transactions
is relevant to this case for multiple reasons, Ms. Giuffre is entitled to discovery regarding that
information. Under Federal Rule of Civil Procedure 34(a), a party may request that another
party produce documents in her possession so long as the documents are within the scope of Fed.
R. Civ. P. 26(b), which allows for broad discovery regarding any non-privileged matter that is
relevant to any partyâs claim or defense. Information within this scope of permitted discovery
need not be admissible in evidence to be discoverable. Relevance is still to be âconstrued
broadly to encompass any matter that bears on, or that reasonably could lead to other matter that
could bear onâ any party's claim or defense. State Farm Mut. Auto. Ins. Co. v. Fayda, No.
14CIV9792WHPJCF, 2015 WL 7871037, at *2 (S.D.N.Y. Dec. 3, 2015) (granting motion to
compel). For reasons explained above, the financial information sought is relevant to issues in
this case, and, accordingly Defendantâs motion for a protective order should be denied. There is
also no sound reason for delaying discovery on these issues.
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A. Discovery of Financial Information is Appropriate Pre-Trial to Avoid the
Need to Summon Two Separate Juries to Hear the Evidence in the Case.
Seemingly recognizing the fact that discovery regarding her financial information is
appropriate, Defendantâs ultimate argument appears not to be that the discovery is improper, but
rather that it should be delayed until after the trial starts. Thus, Defendantâs first specific
argument section is that financial âdiscovery is not appropriate pre-trial.â DE 370 at 6. In
support of this proposition, Defendantâs lead citation is a forty-year-old New York case, Rupert
v. Sellers, 48 A.D.2d 265 (4th Dept. 1975). But as much more recent authority from the Southern
District of New York explains, Rupert is inapplicable to discovery issues because the case relates
solely to the sequence with which evidence can be produced at trial:
[Defendantâs] reliance on Rupert v. Sellers, 48 A.D.2d 265, 368 N.Y.S.2d 904
(4th Depât 1975), for the proposition that punitive damages discovery is not
appropriate until a plaintiff has first established liability is misguided since federal
law and not state law governs questions of procedure such as discoverability.
Hazeldine v. Beverage Media, Ltd., No. 94 Civ. 3466 (CSH), 1997 WL 362229, at
*3 (S.D.N.Y. June 27, 1997) (citations omitted). Moreover, while the Second
Circuit âhas cited Rupert with approval, it has done so for the proposition that
evidence of a defendant's wealth should not âbe brought out at trial unless and
until the jury has brought in a special verdict that the plaintiff is entitled to
punitive damages.â â Id. (citations omitted). It has not held that financial
discovery such as that sought here may only be taken after a liability
determination.
Pasternak v. Dow Kim, 275 F.R.D. 461, 463 (S.D.N.Y. 2011).
Defendant also cites another decision from this court, Collens v. City of New York, 222
F.R.D. 249, 254 (S.D.N.Y. 2004). DE 370 at 7. But Collens does not stand for the proposition
that financial discovery is broadly barred, but only that on the facts of that case no such
discovery was required. As a recent case from the District of New Jersey explains in allowing
pre-trial discovery of financial information for punitive damages purposes:
Defendants assert that until there has been a finding of liability by the jury,
punitive damage discovery is not appropriate. Defendants rely on Collens, where
the court stated that because the issue of punitive damages is generally bifurcated
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from issues of liability, and punitive damages issues thus may never arise,
punitive damage discovery was not necessary at the pretrial stage. See Collens,
222 F.R.D. at 254. Plaintiffs assert that the same jury will decide both liability and
punitive damages issues and that, as a practical matter, there is no time to conduct
discoveryâincluding depositions of the individual police officersâbetween the
liability verdict and the charge to the jury on punitive damages. Plaintiffs' counsel
represented at oral argument that if Defendants are concerned with maintaining
the confidentiality of the individual police officer defendants' personal
information, Plaintiffs will agree to a confidentiality order and the sealing of those
portions of the deposition transcripts and documents that disclose such
information until such time as there is a finding of liability, if any, as to the
individual police officer defendants. . . . Insofar as Plaintiffs assert a claim under
42 U.S .C. § 1983, the Court notes that âevidence of a tortfeasor's wealth is
traditionally admissible as a measure of the amount of punitive damages that
should be awarded[.]â City of Newport v. Fact Concerts, Inc., 453 U.S. 247, 270
(1981). Therefore, interrogatories seeking information about Defendants' financial
condition are reasonably calculated to lead to the discovery of admissible
evidence on the issue of punitive damages.
Graham v. Carino, No. CIV.09-4501 JEI/AMD, 2010 WL 2483294, at *3 (D.N.J. June 4, 2010).
That pre-trial discovery on financial matters is allowed when a punitive damage issue is
present in a case is confirmed by Tillery v. Lynn, 607 F. Supp. 399, 402-03 (S.D.N.Y. 1985). To
leave the discovery until later would be burdensome on the jury â meaning that a common
approach is to allow financial discovery to proceed pre-trial and then to later bifurcate the trial
itself into liability and punitive damages phases:
Discovery as to defendant's personal assets may be undertaken by plaintiff at this
time. It would be unduly burdensome to plaintiff, and most particularly a jury and
the court, to delay resolution of the issue as to the amount of punitive damages, if
any, which should be awarded until discovery as to defendant's personal assets
had been completed. However, as the New York courts have recognized,
âdefendant's wealth should not be a weapon to be used by plaintiff to enable him
to induce the jury to find the defendant guilty of malice, thus entitling plaintiff to
punitive damages.â Rupert v. Sellers, 48 A.D.2d 265, 272, 368 N.Y.S.2d 904, 912
(4th Dep't 1975). Accord, Chilvers v. New York Magazine Company, Inc., 114
Misc.2d 996, 453 N.Y.S.2d 153 (N.Y.Co.Sup.Ct.1982). Accordingly, in the
interest of justice and to avoid any undue prejudice during the liability phase of
this action, the trial will be bifurcated. . . . Therefore, defendant's motions for
partial summary judgment and to stay discovery as to his financial status are
denied.
Tillery v. Lynn, 607 F. Supp. 399, 402-03 (S.D.N.Y. 1985) (Motley, J.).
8
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The holding in Tillery was endorsed in Hazeldine v. Beverage Media, Ltd., No. 94 CIV.
3466 (CSH), 1997 WL 362229, at *2-*3 (S.D.N.Y. 1997), which explainedâ âTillery followed
this preferred course by bifurcating the trial, see Simpson, 901 F.2d at 283, but allowing pre-trial
financial discovery to proceed.â Most cases in most jurisdictions outside the Southern District of
New York have reached exactly the same conclusion and allowed pre-trial discovery of financial
information for punitive damage purposes.4
4
See, e.g.:
ďˇ CEH, Inc. v. FV Seafarer, 153 F.R.D. 491 (D.R.I.1994) (plaintiffs were not required to
establish prima facie case on issue of punitive damages before they could obtain pretrial
discovery of financial information of defendants; plaintiffs had alleged facts sufficient to
make a non-spurious claim for punitive damages and that was sufficient to warrant
discovery);
ďˇ E.E.O.C. v. California Psychiatric Transitions, 258 F.R.D. 391 (E.D.Cal.2009)
(evidence of employer's current financial worth was relevant to issue of punitive
damages, and thus was discoverable in Title VII action alleging sexual harassment and
retaliation, where complaint sought punitive damages, deposition evidence indicated that
employer may have acted in reckless disregard of female employees' federal rights, and
privacy concerns could be addressed with protective order);
ďˇ Grosek v. Panther Transp., Inc., 251 F.R.D. 162 (M.D. Pa. 2008) (there was no good
cause to issue protective order preventing discovery of defendantsâ financial condition
until determination was made that punitive damages were warranted; plaintiffs stated
claim for punitive damages, and delaying discovery until after discovery of evidence
supporting punitive damages would have been inefficient and delayed conclusion of the
case);
ďˇ Vieste, LLC v. Hill Redwood Dev., No. C-09-04024 JSW DMR, 2011 WL 855831, at *1
(N.D. Cal. Mar. 9, 2011) (allowing pre-trial discovery of Defendants' net worth and
financial condition because it was clearly relevant to the issue of punitive damages);
ďˇ Charles O. Bradley Trust v. Zenith Capital, LLC, 2005 WL 1030218, at *3 (N.D.Cal.
May 3, 2005) (while some federal courts have required a prima facie showing of
entitlement to punitive damages before ordering discovery, the majority have not and
listing cases);
ďˇ In re Aqua Dots Products Liability Litigation, 270 F.R.D. 322 (N.D. Ill. 2010), aff'd,
654 F.3d 748 (7th Cir. 2011) (plaintiffs' discovery regarding financial information from
manufacturer and distributor of recalled children's toy was discoverable in a product
liability action. Plaintiffs sought punitive damages, and the distributor and manufacturer
were arguably principal actors);
ďˇ Oakes v. Halvorsen Marine Ltd., 179 F.R.D. 281 (C.D. Cal. 1998) (because defendants
asserted a counterclaim seeking punitive damages, they could obtain discovery regarding
9
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Defendant also cites a decision from Judge Cote in Tyco Intern. Ltd. v. Walsh, which
allowed a delay in seeking discovery of financial information in that case because it was not
clear if the issue would become relevant. But that case involved peculiar circumstances, which
permitted discovery of financial information to be bi-furcated without any burden on the Court.
Specifically, that case involved a bench trial, which allowed a delay between the liability phase
and punitive damages phases of the trial. As the Court explained. âit would be premature to
force the defendant to produce his net worth information at this time. If necessary, plaintiff will
have an opportunity to obtain discovery on the defendant's financial circumstances as part of any
post-trial discovery. Since the trial in this matter is a bench trial, no jury will be burdened by any
delay occasioned by this discovery period.â Tyco Int'l Ltd. v. Walsh, No. 02-CV-4633 (DLC),
2010 WL 3000179, at *1 (S.D.N.Y. July 30, 2010).
Of course, exactly the opposite situation exists here. Defendant would apparently have
the Court delay until the jury returns with its verdict in favor of Ms. Giuffre before allowing
discovery to proceed on Defendantâs financial circumstances. As a practical matter, this would
seem to require sending the jury empaneled to hear liability issues home and then selecting a
new, second jury on punitive damages issues â a new jury which would have to somehow be
shown all of the previous testimony from the liability phase. See Hazeldine v. Beverage Media,
Ltd., No. 94 CIV. 3466 (CSH), 1997 WL 362229, at *2-*3 (S.D.N.Y. 1997) (âallowing pre-trial
plaintiffs' net worth; California limitations on such discovery did not apply in federal
court);
ďˇ Caruso v. Coleman Co., 157 F.R.D. 344 (E.D. Pa. 1994) (âIn products liability action,
plaintiffs would be allowed discovery of defendantsâ financial statements and total sales
revenue on the ground they are relevant to the issue of punitive damages; information
regarding punitive damages is as discoverable as information that relates to liability, and
discovery could proceed without prior proof of prima facie case on punitive damages.â).
10
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discovery [of financial information] avoids the inefficiency of a discovery delay between the
liability and damages phases of trial, as well as the need to assemble a second jury.â).
Finally, Defendant relies upon Guccione v. Flynt, for the proposition that financial
discovery is not appropriate on punitive damages issues here. But that case was sui generis with
peculiar facts that render it inapplicable here. See Guccione v. Flynt, No. 83 CIV. 8020 RWS,
1985 WL 255, at *1 (S.D.N.Y. Feb. 6, 1985) (âIt should be apparent to anyone forced to review
these papers and the issues presented by this action that two men with ample resources are
employing lawyers and occupying space and time in the justice system to continue their personal
feud. Regrettably there is to date no apparent basis to avoid the unappetizing task of ruling on
these motions.â). Moreover, in that case, the Court in fact ordered the Defendant to produce
financial information to be turned over to plaintiffâs counsel at the time of trial. See id. at 1.
While that solution may have worked well in that case, it is not satisfactory here. Defendant is
not an established businessperson with regularly-kept disclosure statements reporting income and
related financial information. Instead, Defendant is participant in a covert, sex trafficking
organization with mysterious financial arrangements and apparent, recent efforts to conceal
assets. In such circumstance, Ms. Giuffre is not required to take the Defendantâs net worth
statement at face value, but instead is entitled to receive it well in advance of trial so that she
may investigate its accuracy.
Finally, this Court has previously rejected exactly the same arguments that are being
made here. This Court explained that â[w]hile bifurcation may be the preferred method of
resolving disputed issues of liability and damages, as it prevents prejudice to the defendants by
keeping financial evidence out of the liability phase of the trial, this does not mean that plaintiffs
should be denied pretrial financial discovery.â Hamm v. Potamkin, No. 98 CIV. 7425 (RWS),
1999 WL 249721, at *2 (S.D.N.Y. Apr. 28, 1999). This Court explained that â[a]s far as the
11
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clear-cut as to deprive Ms. Giuffre of her right to jury trial borders on frivolous. Ms. Giuffre is a
courageous young woman who has come forward to reveal the broad dimensions of a sex
trafficking ring â a criminal conspiracy that involved Defendant. That fact, alone, is enough to
send the issue of damages to Ms. Giuffreâs reputation to a jury, particularly because any other
approach would ârequire[] the Court to make factual findings regarding plaintiff's reputation for
a particular trait.â Church of Scientology Int'l v. Time Warner, Inc., 932 F. Supp. 589, 594
(S.D.N.Y. 1996) (refusing to grant summary judgment on a libel proof plaintiff argument), aff'd
238 F.3d 168 (2d Cir. 2001); see also id. citing Liberty Lobby, Inc. v. Anderson, 746 F.2d 1563,
1568 (D.C. Cir. 1984) (âTo begin with, we cannot envision how a court would go about
determining that someone's reputation had already been âirreparablyâ damagedâi.e., that no new
reader could be reached by the freshest libelâ (Scalia, J.) (emphasis in original)), vacated on
other grounds, 477 U.S. 242 (1986).
Defendant also predicts that Ms. Giuffre will âhave a nearly insurmountable task to
demonstrate that [Defendant] acted with the requisite degrees of malice.â DE 370 at 10
(emphasis added). Of course, the qualifier gives away the game â a ânearlyâ insurmountable
task is not one on which summary judgment is appropriate. And, in any event, once Ms. Giuffre
proves at trial (as she will) that Defendant was deeply involved in Epsteinâs sex trafficking ring,
it becomes obvious that Defendantâs attacks on Ms. Giuffreâs credibility were uttered with
malice. Defendant knew full well, for example, that Ms. Giuffreâs statements that Defendant
was involved in Epsteinâs sex trafficking were not âobvious lies.â She knew that because she
had been involved in (among other things) procuring multiple underage girls for Epstein to
sexually abuse10 â including Ms. Giuffre herself.
10
See Message Pads concerning Defendant (GIUFFRE001523; GIUFFRE001427;
GIUFFRE001451; GIUFFRE001454; GIUFFRE001460; GIUFFRE001461; GIUFFRE001464;
14
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III. DISCOVERY OF DEFENDANTâS FINANCIAL INFORMATION SHOULD NOT
BE CONFINDED TO A NET WORTH STATEMENT.
Perhaps recognizing that it is inevitable that her financial information will be relevant in
this case, Defendant makes one last argument that discovery of financial information should be
âlimited to a sworn affidavit of net worth.â DE 370 at 13. Whatever may have been the
circumstance warranting limitations in other cases, the circumstances here make that approach
highly inappropriate. Once again, it is important to remember that this is not a case involving,
for example, a public-traded company with audited financial statements, or a situation involving
otherwise-incontestable financial information. Cf. Hamm v. Potamkin, No. 98 CIV. 7425
(RWS), 1999 WL 249721, at *3 (S.D.N.Y. Apr. 28, 1999) (for purposes of pre-trial punitive
damages discovery, directing corporate defendants âto produce a financial affidavit containing a
statement of its total net worth and listing its income, assets, and liabilities for the past three
yearsâ).
Instead, this case involves a shadowy criminal organization, involving a kingpin with vast
wealth (Jeffrey Epstein, a reported billionaire), and multi-million dollar transactions to others in
the organization such as Defendant (e.g., the apparent concealed transfer, through an attorney
associated with Epstein, of an apartment to Defendant worth, in 2015, $15,000,000). Given the
strong possibility of wrongdoing lurking here, a mere declaration of net worth promises to be
next to worthless. To provide a simple example, if Defendant were to testify at trial she had a
net worth of only ten million dollars â and not provide information about where she had hidden
the fifteen million dollars associated with the sale of her apartment â then Ms. Giuffre will have
little effective way to challenge the claim. Moreover, as noted above, the record is replete with
multiple examples of Defendant failing to recall obvious and highly incriminating facts. Given
Defendantâs amnesia about important events, it seems obvious that she may similarly be
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(DE 62). As this Court has previously explained, in allowing discovery of financial information
for punitive damage purposes, âany privacy interests defendants may have in confidential
financial information produced to plaintiffs can be secured by the protective order issued by this
Court.â Hamm v. Potamkin, No. 98 CIV. 7425 (RWS), 1999 WL 249721, at *2 (S.D.N.Y. Apr.
28, 1999). Nothing in Defendantâs motion establishes that Ms. Giuffre should be barred from the
kinds of ordinarily discovery that often accompanies cases in which the financial dealings of a
defendant are discoverable.
This argument is also belied by the fact that Defendant sought, and received, Ms.
Giuffreâs personal financial information. Specifically, she sought any payment information
relating to the media. See Defendantâs First Set of Requests for Production at No. 30. Ms.
Giuffre provided documents responsive to this request, which included her personal bank
records. Defendant takes the contradictory and self-serving position that discovery concerning
the personal finances of Ms. Giuffre is appropriate, yet discovery concerning her own finances is
somehow inappropriate.
At the very least, the Defendant should be required to produce a âstatement of [her] total
net worth and listing [her] income, assets, and liabilities for the [relevant] years,â as this Court
ordered in a previous case. Hamm v. Potamkin, No. 98 CIV. 7425 (RWS), 1999 WL 249721, at
*3 (S.D.N.Y. Apr. 28, 1999). But because that formulation came from an earlier case involving
reputable corporate entities with (apparently) audited financial statements, the discovery here
should be much broader â and should include all of the significant requests made by Ms. Giuffre.
For example, Defendant should also be required to identify all financial transactions involving
(directly or indirectly) Jeffrey Epstein, , Ellmax LLC, The TerraMar
Project, and any other person listed in the Rule 26 disclosures of either side in this case.
Transactions with potential witnesses in this case are highly relevant to bias and other trial
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issues. And because of concern that the Defendant is concealing assets, she should also be
required to reveal all significant (greater than $10,000) assets or other monetary transfers in since
the beginning of January 1, 2015, as well as all transfers of assets or money outside of this
Courtâs jurisdiction, including transfers overseas.
IV. CONCLUSION
Based upon the foregoing, Ms. Giuffre respectfully requests that this Court deny
Defendantâs motion for a protective order barring discovery into her financial situation. In a
contemporaneously-filed motion to compel, Ms. Giuffre also respectfully requests that the Court
grant a motion to compel Defendant to answer questions about her financial information.
Dated: August 22, 2016.
Respectfully Submitted,
BOIES, SCHILLER & FLEXNER LLP
By: /s/ Sigrid McCawley
Sigrid McCawley (Pro Hac Vice)
Meredith Schultz (Pro Hac Vice)
Boies Schiller & Flexner LLP
401 E. Las Olas Blvd., Suite 1200
Ft. Lauderdale, FL 33301
(954) 356-0011
David Boies
Boies Schiller & Flexner LLP
333 Main Street
Armonk, NY 10504
Bradley J. Edwards (Pro Hac Vice)
FARMER, JAFFE, WEISSING,
EDWARDS, FISTOS & LEHRMAN, P.L.
425 North Andrews Avenue, Suite 2
Fort Lauderdale, Florida 33301
(954) 524-2820
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Paul G. Cassell (Pro Hac Vice)
S.J. Quinney College of Law
University of Utah
383 University St.
Salt Lake City, UT 84112
(801) 585-520214
14
This daytime business address is provided for identification and correspondence purposes only
and is not intended to imply institutional endorsement by the University of Utah for this private
representation.
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CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 22th day of August, 2016, I electronically filed the
foregoing document with the Clerk of Court by using the CM/ECF system. I also certify that the
foregoing document is being served this day on the individuals identified below via transmission
of Notices of Electronic Filing generated by CM/ECF.
Laura A. Menninger, Esq.
Jeffrey Pagliuca, Esq.
HADDON, MORGAN & FOREMAN, P.C.
150 East 10th Avenue
Denver, Colorado 80203
Tel: (303) 831-7364
Fax: (303) 832-2628
Email: [email protected]
[email protected]
/s/ Sigrid S. McCawley
Sigrid S. McCawley
22