In lawsuits, parties commonly subpoena bank records of other parties, sometimes casting a net far wider than necessary. Individuals and business can fight this approach but only with knowledge of the protections available.
Recently, a U.S. Bankruptcy Court in New York entered a ruling reminding individuals who are not parties to a lawsuit of their right to move to quash (or declare unenforceable) a subpoena issued on a bank holding their records. The court stated that individuals whose banking records are subpoenaed have a privacy interest in their personal financial affairs that gives them standing to move to quash a subpoena served on a non-party financial institution. To determine whether the information would be protected, the court stated it would balance the relevance of the information sought with the intrusion on the individual’s privacy interests.
While federal and state subpoenas are subject to different rules affording protection for individuals and business entities, subpoenas from both federal and state courts may be quashed to protect a person, whether an individual or a business entity, from annoyance or embarrassment. Under certain circumstances, subpoenas may be quashed to protect personal and private financial information or to protect sensitive commercial information.
A fundamental factor in determining whether records will be protected is whether they are relevant to a pending lawsuit. If a subpoena is served as a “fishing expedition” to find other parties to sue or claims to make, when no other factual basis exists, courts have been inclined to quash the subpoena. As emphasized by the recent case in the U.S. Bankruptcy Court in New York, non-party individuals and business entities have standing to seek such protections from the disclosure of personal, private, or commercially sensitive information when their records are subpoenaed.
If you receive notice that a subpoena has been served on a financial institution for your bank records (or on any party for records related to you), be aware that you may have the right to prevent disclosure of these documents and should contact an attorney to discuss these rights. Certain time limitations to seek protections may apply; therefore, inquiry with an attorney should be made as soon as practicable.
For more information please contact Vincent Guida at 410-583-2400 or firstname.lastname@example.org.