On December 14, 2023, Justice Murphy of the Nassau County Commercial Division issued a decision in Parizat v. Meron, 2023 NY Slip Op. 34587(U), ordering the production of tax returns despite the heavy burden of justifying their production, explaining:
Due to the confidential and private nature of tax returns, tax returns generally are not discoverable in the absence of a strong showing that the information is indispensable to a claim or defense and cannot be obtained from other sources.
Here, with respect to plaintiff’s motion, whether Ovadia is an owner or a consultant of ION Tech through to the present is the central issue in this action. While, through plaintiff’s request to admit, Ovadia has made admissions with respect to certain information he disclosed on his tax returns for the years 2008 through 2011 and 2019 through 2021, additional information concerning the question of Ovadia’s relationship with ION Tech can only be gleaned from the disclosure of those tax returns and the corresponding Form 1099’s issued and plaintiff has demonstrated that it requires this tax information, which cannot be obtained from other sources; in order to move for summary judgment on its cause of action seeking a declaratory judgment. As a result, such information is indispensable to plaintiff’s prosecution of this action and to defend against defendants’ affirmative defense asserting Ovadia’s alleged ownership interest in ION Tech. As a result, Ovadia is to produce the documents as requested for the time periods of which plaintiff is not in possession and during which Ovadia alleges that he is a 50% owner of ION Tech.
(Internal quotations and citations omitted).