Matter of Subpoena to Loeb & Loeb LLP

OPINION & ORDER This decision resolves a motion brought by Aaron Goodwin, Regina Goodwin, and Eric Goodwin (collectively, the “Goodwins”), under Federal Rules of Civil Procedure 37 and 45(d)(2)(B)(i), to compel compliance with a subpoena served upon the law firm of Loeb & Loeb (“Loeb”), in connection with a pending adversary proceeding before the U.S. Bankruptcy Court for the District of Delaware, as well as Loeb’s cross-motion to quash the subpoena. For the reasons that follow, the Court grants the Goodwins’ motion to compel compliance with the subpoena and denies Loeb’s motion to quash, subject, however, to the essential condition that the Goodwins bear the costs-and a substantial portion of the legal fees-incurred in connection with Loeb’s compliance with the subpoena.I. Background¹A. Facts1. The Underlying LitigationOn September 12, 2017, XXIII Capital Limited (“23 Capital”) filed a verified complaint in the United States District Court for the Southern District of New York against Decade, S.A.C., Contracts, LLC, Decade, S.A.C. Executives, LLC, Decade, S.A.C. I, LLC, Decade, S.A.C. II, LLC, Decade, S.A.C. II, LLC, Decade, S.A.C., LLC, and Gotham S&E Holdings, LLC (the “Decade Entities”); the Decade Entities’ principals, Christopher Aden and Dorsey James (together with the Decade Entities, “Decade”); Aaron Goodwin and Eric Goodwin; and Goodwin Associates Management Enterprises, Inc. (“GAME”) and Goodwin Sports Management, Inc. (“GSM” and with GAME, the “Goodwin Entities”). See XIII Capital Ltd. v. Decade, S.A.C., LLC, et al., Case No. 17 Civ. 6910 (GHW) (the “SDNY Action”), Dkt. 1 (“SDNY Compl.”). 23 Capital alleged that, in a series of integrated transactions dated on or about February 22, 2016, Decade purchased two sports agencies that had been owned and managed by the Goodwins, and that 23 Capital extended a $20 million senior secured loan to Decade to fund that transaction. Upon the closing of the transactions, the Goodwins allegedly received a down payment of $9.5 million and became senior employees of Decade. SDNY Compl.

27-51.23 Capital further alleged that Decade repeatedly failed to make required payments against the loan, and in December 2016, 23 Capital sent Decade a default letter. Id.