Arturo Arita v. FDS Associates, LLC; FDS Associates, LLC v. The City of New York
Attorneys and Parties
Brief Summary
Civil procedure in personal injury litigation—post-note-of-issue discovery and amendment of pleadings based on parallel fraud allegations.
Denied the City's motion to amend its answer to add fraud-based defenses, to strike the note of issue for further discovery, and to stay summary judgment motions.
Modified to permit limited additional discovery of plaintiff while keeping the case on the trial calendar; otherwise affirmed.
Allegations in a separate RICO action were insufficient to justify adding fraud defenses, but narrowly tailored discovery into plaintiff’s knowledge of those allegations was appropriate under controlling First Department precedent and permissible post-note-of-issue under 22 NYCRR 202.21(d) [rule permitting limited post-note-of-issue discovery in the court’s discretion while the case remains on the trial calendar].
Background
In a personal injury action, plaintiff Arturo Arita sued FDS Associates, LLC. FDS impleaded The City of New York as a third-party defendant. The City moved to amend its answer to assert affirmative defenses of fraud and fraud on the court, relying on a federal Racketeer Influenced and Corrupt Organizations Act (RICO) complaint naming plaintiff’s attorneys and certain medical providers. The City also sought to strike the note of issue to conduct further discovery and to stay pending summary judgment motions.
Lower Court Decision
The Supreme Court, Bronx County (Myrna Socorro, J.), by order entered on or about August 12, 2025, denied the City's motion in its entirety: no leave to amend to add fraud-based defenses, no striking of the note of issue for additional discovery, and no stay of summary judgment motions.
Appellate Division Reversal
The Appellate Division modified: it permitted the City to conduct limited discovery consisting of a deposition of plaintiff confined to his knowledge, if any, of facts underlying the federal RICO allegations against his attorneys and medical providers, and to obtain any documents identified during that deposition. This discovery is to proceed while the matter remains on the trial calendar under 22 New York Codes, Rules and Regulations (NYCRR) 202.21(d) [rule permitting limited post-note-of-issue discovery in the court’s discretion while the case remains on the trial calendar]. The court otherwise affirmed, including denial of leave to amend to add fraud and fraud-on-the-court defenses, and noted the request to stay plaintiff’s summary judgment motion was moot because a decision had already issued.
Legal Significance
The decision reinforces that mere reliance on allegations from a parallel federal RICO action against a plaintiff’s counsel or medical providers does not warrant amending an answer to add fraud-based defenses. At the same time, courts may allow targeted, proportional post-note-of-issue discovery focused on a plaintiff’s own knowledge of the alleged scheme without striking the note of issue, consistent with First Department precedents and 22 NYCRR 202.21(d).
Courts will not permit fraud or fraud-on-the-court defenses based solely on allegations in a separate RICO case, but they may allow narrowly tailored post-note-of-issue discovery into a plaintiff’s knowledge of those allegations while keeping the case on the trial calendar.