Velasquez v. Kelly: No CPLR 3126 Striking Sanction Where the Sought Surveillance Footage Is Proven Not to Exist; Non-Aggrieved Third-Party Defendant Lacks Appellate Standing

1. Introduction

Case: Velasquez v Kelly, 2026 NY Slip Op 05211 (App. Div., 2d Dep’t Sept. 2, 2026).
Parties: Plaintiff Rosa Yanes Velasquez (respondent) sued homeowner John Kelly (defendant/third-party plaintiff-appellant). Kelly impleaded E.L.M. General Construction Corp. (third-party defendant-appellant), the plaintiff’s employer.
Underlying incident: Plaintiff allegedly fell from a ladder while power washing Kelly’s home.
Core dispute on appeal: Whether Kelly could be sanctioned under CPLR 3126—including a conditional striking of his answer—for failing to produce additional, pre-accident surveillance footage that plaintiff demanded, and whether E.L.M. had standing to appeal discovery/sanction orders directed at Kelly.

The Second Department’s decision is primarily procedural, but it clarifies two recurring litigation issues: (1) appellate standing under CPLR 5511 (“aggrievement”), and (2) the limits of CPLR 3126 sanctions when the demanded material is shown not to exist.

2. Summary of the Opinion

  • E.L.M.’s appeals dismissed: E.L.M. was not “aggrieved” by the portions of the orders appealed from and therefore lacked standing under CPLR 5511.
  • Portions of Kelly’s appeal dismissed as procedural:
    • Appeal from the July 23, 2024 order compelling disclosure was dismissed because it was superseded by the November 8, 2024 order made “in effect, upon reargument.”
    • Appeal from the July 23, 2024 conditional striking was dismissed as academic in light of the court’s disposition of the November 8, 2024 order.
  • Key merits holding: The Supreme Court should have vacated the portion of the July 23, 2024 order that conditionally struck Kelly’s answer, because the record showed Kelly complied by demonstrating that the additional footage did not exist, and there was no evidence of willful or contumacious noncompliance.
  • Renewal properly denied: Kelly’s motion to renew was correctly denied for failure to provide a reasonable justification for not presenting the “new” facts earlier, as required by CPLR 2221(e).

3. Analysis

3.1. Precedents Cited

A. Appellate standing (“aggrievement”) under CPLR 5511

  • Mixon v TBV, Inc., 76 AD3d 144, 156-157
    The foundational articulation of “aggrievement”: a party is aggrieved when the relief it sought was denied (in whole or part), or when relief was granted against it over its opposition. The court used Mixon to frame the standing inquiry.
  • Estella v Val Auto, LLC, 221 AD3d 967, 968
    Quoted for the same “aggrieved” definition (with Mixon) and applied to conclude that E.L.M., as a third-party defendant, was not directly affected by discovery sanctions directed at Kelly.
  • Price v 7th Gear Corp., 244 AD3d 1264
    Cited to reinforce dismissal of an appeal where the appellant is not aggrieved by the order. This supports a consistent Second Department approach: parties cannot appeal merely because an order may indirectly influence litigation dynamics.

B. Conditional preclusion/striking orders and when they become absolute

  • Matter of Metro-North. Train Acc. of Feb. 3, 2015, 178 AD3d 929, 931
    Used to define a “conditional order of preclusion” (including conditional striking): produce discovery by a date certain or face specified sanctions. The court relies on this to categorize the July 23 order as a conditional sanction order.
  • Torres v Dayton Hudson Corp., 171 AD3d 827, 828
    Reinforces the same concept of conditional preclusion orders in discovery practice.
  • McIntosh v New York City Partnership Dev. Fund Co., Inc., 165 AD3d 1251, 1252
    Cited for the rule: if the party does not comply by the specified date, the conditional order becomes “absolute.” This is key because it frames the severity of conditional sanctions as self-executing upon noncompliance.
  • Wolf Props. Assoc., L.P. v Castle Restoration, LLC, 174 AD3d 838, 841
    Supports the same “becomes absolute upon default” principle, emphasizing the strict procedural effect of conditional discovery orders.
  • Winters v City of New York, 234 AD3d 805, 807
    Provides the standard for relief from the impact of a conditional order: the defaulting party must show (1) a reasonable excuse and (2) a potentially meritorious claim or defense.

C. Limits on compelling production and sanctioning: cannot produce what does not exist

  • Robert v Azoulay Realty Corp., 209 AD3d 781, 785-786
    Central to the outcome. The court quotes the core rule: “A party may not be compelled to produce or sanctioned for failing to produce information which he [or she] does not possess.” This precedent directly supports vacating the conditional striking once Kelly demonstrated the requested additional footage did not exist.
  • McGroarty v Long Is. Coll. Hosp., 37 AD3d 431, 431
    Cited with Robert to reinforce that sanctions—especially severe sanctions like striking—are inappropriate absent evidence of willful or contumacious noncompliance.

D. Showing a potentially meritorious defense

  • Pugliese v Mondello, 67 AD3d 880, 881
    Cited for the proposition that, in seeking relief from a conditional preclusion order, a party must demonstrate a potentially meritorious defense. The court found Kelly met this burden, supporting vacatur of the conditional striking.

E. Renewal standards under CPLR 2221(e)

  • Agostinacchio v Jofaz Transp., Inc., 238 AD3d 691, 694
    Used to apply CPLR 2221(e)(2)-(3): renewal must be based on new facts (or a change in law) that would change the prior determination, and the movant must provide a reasonable justification for not presenting them earlier. Kelly failed the justification requirement, so renewal was properly denied.

3.2. Legal Reasoning

A. Why E.L.M.’s appeals were dismissed

The court applied CPLR 5511 and the Mixon/Estella “aggrieved party” test. The discovery-compulsion and conditional striking provisions ran against Kelly, not E.L.M. Even if E.L.M. had strategic interest in the discovery dispute, the appellate rules require a direct adverse effect from the order appealed. Thus, E.L.M. lacked standing, and its appeals were dismissed.

B. The conditional striking sanction could not stand once nonexistence was shown

The July 23, 2024 order effectively said: produce additional pre-accident video footage by August 23, 2024 or the answer will be stricken. The Second Department treated this as a classic conditional discovery sanction order and recited the doctrine that such orders become absolute upon noncompliance.

But the court then focused on a more basic limitation: a party cannot be compelled to produce, nor sanctioned for failing to produce, material that does not exist or is not possessed by the party (quoting Robert v Azoulay Realty Corp.). The record, as the appellate court read it, showed that Kelly complied with the conditional order by demonstrating that the demanded additional footage did not exist. Because the predicate for an “absolute” default—failure to produce existing discoverable material within the party’s control—was missing, the conditional striking was improper.

The court also found no evidence of willful or contumacious conduct, which is commonly required to justify severe sanctions like striking a pleading. In other words, even if there were a discovery shortfall, the record did not show the kind of bad-faith obstruction that warrants the harshest CPLR 3126 remedies.

C. Why renewal was denied even though Kelly obtained partial relief

Kelly sought renewal and reargument. Renewal is tightly constrained: it requires not only new facts (or a change in law) but also a reasonable justification for failing to present those facts earlier. The court held Kelly did not meet that justification requirement, so renewal was properly denied under CPLR 2221(e) (as applied in Agostinacchio v Jofaz Transp., Inc.).

Notably, Kelly still obtained meaningful relief through vacatur of the conditional striking provision—demonstrating that appellate outcomes can be mixed: a court may reject a procedural vehicle (renewal) but still correct an improper sanction.

3.3. Impact

  • Stronger guardrails against “impossible production” sanctions: The decision underscores that CPLR 3126 sanctions—especially striking—should not be imposed where the responding party establishes that the demanded item does not exist. The practical lesson is that parties resisting a “missing evidence” demand should promptly create a clear record (affidavits, vendor attestations, system retention policies, or forensic confirmations) demonstrating nonexistence or lack of possession/control.
  • Reinforces the need for willfulness for harsh penalties: The court’s emphasis on the absence of “willful or contumacious” conduct signals that, in the Second Department, striking an answer remains a last resort, generally reserved for obstruction rather than mere dispute or inability.
  • Standing discipline for third-party defendants: Third-party defendants cannot appeal discovery rulings directed at the third-party plaintiff simply because the rulings may affect the broader litigation environment. This reduces satellite appeals and channels review to those directly burdened by the order.
  • Renewal motions remain unforgiving: Even where a party later assembles better proof, CPLR 2221(e) requires a convincing explanation for why it was not submitted earlier. Litigation teams should treat initial motion practice as the main event, not a draft.

4. Complex Concepts Simplified

  • CPLR 3126 (Discovery Sanctions): A statute allowing courts to penalize parties who refuse to disclose information they are required to provide. Penalties can range from orders compelling disclosure to precluding evidence to striking pleadings.
  • Conditional order of preclusion / conditional striking: A “comply by this date or else” order. If compliance does not occur by the deadline, the sanction can automatically take effect (“becomes absolute”).
  • Willful or contumacious conduct: Legal shorthand for intentional, stubborn, or bad-faith noncompliance—more than a mistake or inability. Courts often require this before imposing extreme sanctions like striking an answer.
  • Aggrieved party (CPLR 5511): Only someone directly harmed by an order can appeal it. Being unhappy with an order’s indirect consequences is not enough.
  • Renewal vs. reargument (CPLR 2221):
    • Reargument asks the court to reconsider because it overlooked or misapplied existing law or facts already in the record.
    • Renewal relies on new facts (or a change in law) and requires a good reason those facts were not presented before.

5. Conclusion

Velasquez v Kelly reaffirms two practical rules in New York civil litigation. First, a third-party defendant must be truly “aggrieved” to appeal; otherwise, the appeal is jurisdictionally barred under CPLR 5511. Second, and more substantively, courts should not enforce the harshest CPLR 3126 sanctions—such as striking an answer—where the responding party demonstrates that the demanded discovery (here, additional surveillance footage) does not exist and there is no showing of willful or contumacious noncompliance. The decision thus strengthens the principle that discovery sanctions must be tethered to both feasibility of compliance and culpability, not merely to an unmet demand.