Opinion
Civil Action No. 03-3054.
June 14, 2004
ORDER
AND NOW, this 14th day of June, 2004, upon consideration of the Objection of Bertz Co. to Plaintiff's Subpoena Under Federal Rule of Civil Procedure 45(c)(2)(B), (Doc. No. 10), and the Motion to Quash Plaintiff's Subpoena filed by Defendant H.D.J. Company, Inc., (Doc. No. 11), it is ORDERED that the Objection and Motion to Quash are GRANTED in part and DENIED in part.
Plaintiff served a request for production of documents on Defendant, requesting, in part, copies of Defendant's federal tax returns for the years 1997 through 2002. (Doc. No. 13, Ex. A at 5.) Plaintiff claims the tax returns are relevant to his claim for punitive damages. Defendant refused to produce the tax returns, claiming Plaintiff's request was "overly broad and unnecessarily invasive" and "not reasonably calculated to lead to admissible evidence." ( Id. Ex. B at 3.) Plaintiff then served a subpoena on Defendant's accountant, Bertz Co., requesting copies of Defendant's federal tax returns and financial statements for the years 2002 through the present. (Doc. No. 12, Ex. A.) Plaintiff also requested that Bertz Co. produce the same information for two other companies, non-parties Burton Enterprises and Specialized Medical Devices, Inc. ( Id.) Defendant and Betz Co. object to Plaintiff's subpoena on the grounds that it requests information protected by Pennsylvania's accountant-client privilege, codified in the C.P.A. Law, 63 P.S. Section 9.11a. They also argue that the financial records of the non-parties are irrelevant; and that producing Defendant's financial records may reveal personal financial information about Defendant's owners and violate their rights to privacy.
That statute provides that "[e]xcept by permission of the client engaging him or the heirs, successors or personal representatives of a client, a licensee or a person employed by a licensee shall not be required to, and shall not voluntarily, disclose or divulge information of which he may have become possessed unless the sharing of confidential information is within the peer review process. . . ." Id.
We reject Defendant's claim of accountant-client privilege. "[F]ederal courts are to apply federal law of privilege to all elements of claims except those `as to which State law supplies the rule of decision.'" Pearson v. Miller, 211 F.3d 57, 66 (3d Cir. 2000). Here, several of Plaintiff's claims arise under federal law, which does not recognize an accountant-client privilege. See United States v. Arthur Young Co., 465 U.S. 805, 817 (1984). We agree that the financial information of the non-parties is clearly not relevant and therefore need not be produced. See Dart Indus., Inc. v. Liquid Nitrogen Processing Corp. of Ca., 50 F.R.D. 286, 292 (D. Del. 1970) (subpoena may be quashed if material sought is clearly irrelevant). Finally, we reject Defendant's claim that its financial records should not be produced because they contain private financial information about Defendant's owners. Were we to sustain this objection, it is doubtful that the financial information of a company with few owners would ever be discoverable. Defendant's financial information is clearly discoverable in light of Plaintiff's punitive damages claim. See Caruso v. Coleman Co., 157 F.R.D. 344, 348 (E.D. Pa. 1994) (financial information of defendant corporation is discoverable when punitive damages claim is asserted).
Though Plaintiff claims that Defendant and the non-party companies are "interrelated," he has not provided sufficient evidence in support of that claim such that we can order the production of the non-parties' financial information.
Accordingly, Bertz Co. is directed to comply with Plaintiff's subpoena to the extent it seeks copies of Defendant's federal tax returns and financial statements for the years 2002 through the present. In all other respects, Defendant and Bertz Co.'s objections to Plaintiff's subpoena are sustained.
IT IS SO ORDERED.