Opinion
04 Civ. 604 (CSH).
February 22, 2007
MEMORANDUM OPINION AND ORDER
This diversity action involves disputes over the ownership and use of two computer programs. The factual background is stated in detail in the Court's prior opinion resolving several motions, reported at 2004 WL 1781009 (S.D.N.Y. Aug. 10, 2004).
Plaintiff Richard Rosen died unexpectedly on August 23, 2005. Defendants' counsel served and filed a Suggestion of Death on the record, dated March 28, 2006. Plaintiffs' counsel has now made a motion under Federal Rule of Civil Procedure 25(a)(1) to substitute Maria St. Ann Derr, who has been appointed as the administrator of Plaintiff Rosen's estate, in Rosen's place. Defendants oppose the motion to substitute plaintiff. For the following reasons, the motion is denied, without prejudice to its renewal following the submission of additional materials curing the defects and addressiing the questions discussed in this Opinion.
DISCUSSION
I. Retention of Plaintiffs' Attorney to Represent Plaintiff Rosen's Estate
A "proper party" for substitution as plaintiff under Rule 25(a)(1) is "either (1) a successor of the deceased party — a distributee of an estate . . ., or (2) a representative of the deceased party — a person lawfully designated by state authority to represent the deceased's estate." Billups v. West, No. 95 Civ. 1146, 1998 WL 341939, at *1 (S.D.N.Y. June 26, 1998). It appears that Ms. St. Ann Derr, as the Surrogate's Court-recognized administrator of the estate, falls within the second category and would consequently be a proper party for substitution. However, from the submissions made by Plaintiffs' counsel, it is unclear whether Ms. St. Ann Derr has formally authorized Plaintiffs' counsel to represent the estate of Plaintiff Rosen. Plaintiffs' counsel states only that Ms. St. Ann Derr told him she did not object to the motion to substitute counsel. That is insufficient to satisfy the applicable standard. Case law holds that Rule 25(a)(1) "should be interpreted strictly so as to preclude the attorney for a deceased party from moving for substitution unless he acts for the `successors or representatives' at the time such motion is made." In re Klein, 360 B.R. 390, 392 (Bankr. E.D.N.Y. 1984). The rationale for this is that
the attorney for the decedent is no longer acting on behalf of such decedent in light of the fact that his power of attorney would have terminated upon the death of his principle. Nor is such attorney acting for decedent's successors and representatives until such time as such successor or representative is officially appointed, and after having been appointed, retains the attorney.Id.
In the case at bar, based on the current record, I cannot conclude that Ms. St. Ann Derr has retained Plaintiffs' counsel to represent the estate of deceased Plaintiff Rosen. Accordingly, I will not grant Plaintiffs' attorney's motion to substitute plaintiff at this time.
II. Issues Regarding the Administrator's Authority, the Letters of Administration, and the Petition for the Letters of Administration
Defendants also oppose the motion to substitute plaintiff because of issues relating to the scope of Ms. St. Ann Derr's authority, the Letters of Administration, and the Petition for Letters of Administration. First, and most importantly, Defendants point out that the text of the Letters of Administration contains the following restriction on Ms. St. Ann Derr's power: "These letters authorize the collection only of a total of $49999.99 dollars. Any collection above that amount must be authorized by further order of the Surrogate." The damages pleaded in the amended complaint exceed $4 million. The question arises why Ms. St. Ann Derr was granted such a limited ability to recover as representative of Plaintiff Rosen's estate, and what effect this limitation would have on the action if she were to be substituted as plaintiff.
Second, Defendants contend that failure to list certain estate assets involved in this litigation (namely, a purported interest in the copyrights at issue) in the Petition for Letters of Administration raises the question of whether those assets have in fact been transferred; if such a transfer has occurred, a significant standing question arises.
Third, Defendants raise a question regarding the failure to list in the Petition for Letters the potential liability of Plaintiff Rosen's estate for counterclaims and claims for attorney's fees made by Defendants.
These circumstances raise significant questions regarding the propriety of substituting Ms. St. Ann Derr in place of Plaintiff Rosen. Unless and until these issues are addressed and my concerns are adequately alleviated, I will not grant the motion to substitute plaintiff.
CONCLUSION
Accordingly, on the present record, Plaintiffs' motion to substitute plaintiff is denied. However, such denial is without prejudice to renewal of the motion upon submission the submission of averments or documents correcting the defects and addressing the questions noted supra.
Any additional submissions on behalf of the deceased Plaintiff Rosen's representative and/or that Plaintiff's counsel must be served and filed not later than March 23, 2007, failing which the motion will be denied without recourse. If Plaintiffs do make additional submissions addressing the above issues, Defendants may, if they so desire, serve and file a response not later than April 20, 2007.
The foregoing is SO ORDERED.