The following e-filed documents, listed by NYSCEF document number (Motion 004) 81, 82, 83, 84, 85, 86, 87, 88, 89, 91, 92, 93, 94, 95, 96, 97, 98, 99, 100, 101, 102, 103, 104, 105, 106, 108, 131 were read on this motion to/for DISCOVERY. DECISION + ORDER ON MOTION This motion arises from the deposition of David Baum (Deposition), the designated corporate witness of nonparty Cy Twombly Foundation (Foundation). Baum serves as the Foundation’s Secretary and General Counsel. The court presumes familiarity with the action. Plaintiff Phillips Auctioneers LLC (Phillips), an auction house specializing in the sale of 20th century and contemporary art, timepieces, and jewelry (NYSCEF Doc. No. [NYSCEF 40], amended compl. 1), brought this breach of contract action against defendant Pier Franco Grosso to recover an advance, a withdrawal fee, and out-of-pocket expenses for the withdrawal of the alleged false artwork by late artist Cy Twombly (the Work). Grosso, consignor of the Work, counterclaimed for breach of duty, alleging Phillips failed to disclose relevant information to Grosso it received from the Foundation concerning the Work, which he contends led to the Work’s withdrawal from sale. (See NYSCEF 43, answer with counterclaims 1 at 8.) The contract at issue is the consignment agreement between Phillips and Grosso (Consignment Agreement), which provided that Phillips may “withdraw any Lot at any time before sale without any liability in our sole judgment: (i) there is reasonable doubt as to its authenticity, authorship or attribution[]….” (NYSCEF 41, exhibit A to amended complaint, Consignment Agreement at 6 [section 10 (a) (i)].1) Phillips asserts that section 10(b) requires Grosso to pay out-of-pocket costs, a 25 percent withdrawal fee, and return the amount of the advance plus interest if Phillips withdraws the Work from sale pursuant to section 10(a)(i). (NYSCEF 40, amended compl. 31.) There is a related tort action, initiated by Grosso, against the Foundation, Baum, Nicola Del Roscio2 (Tort Action), index no. 155762/2022. Grosso’s Request for Del Roscio’s Deposition and Additional Discovery In this motion, Grosso moves, pursuant to CPLR 3124, to (i) compel the deposition of Del Roscio as the corporate witness for the Foundation; (ii) compel the Foundation to produce additional documents that have been withheld; (iii) declassify documents and testimony previously designated as confidential;3 and, pursuant to CPLR 3126 and 22 NYCRR 130-1.1, for (iv) sanctions against the Foundation in the form of reasonable attorneys’ fees and expenses incurred to prepare for and conduct the Deposition against the Foundation and filing this motion to compel. As to (ii), Grosso specifically seeks (a) the “envelope file” of the Work, including the front and back of the envelope, any documents contained within, and documents illustrating how these files are kept in the ordinary course of business, or confirmation that the entirety of such file has been produced; (b) all files concerning all alleged fake artworks maintained by the Foundation, (c) documents and communications concerning the Foundation’s procurement of an alleged false Italian criminal conviction concerning Grosso, (d) all documents, communications, notes concerning the Work, (e) all database records concerning the Work, and (f) all other documents or communications responsive to the discovery requests submitted to the Foundation which have not previously been produced by the Phillips (the Additional Discovery). A. Del Roscio’s Deposition “A corporate entity has the right to designate, in the first instance, the employee who shall be examined.” (Nunez v. Chase Manhattan Bank, 71 AD3d 967, 968 [2d Dept 2010] [citations and internal quotation marks omitted].) The party moving for an additional deposition must demonstrate that “(1) the representatives already deposed had insufficient knowledge, or were otherwise inadequate, and (2) there is a substantial likelihood that the persons sought for depositions possess information which is material and necessary to the prosecution of the case.” (Id. [citations omitted].) Grosso claims Del Roscio’s deposition is relevant to the prosecution of his counterclaim and also in his defense because Del Roscio has unique information on a number of matters. A brief review of Grosso’s counterclaim and the amended complaint’s allegations sheds light on this issue. Grosso counterclaimed that “in or about July or August 2019, Phillips was contacted by the Foundation and was informed that the Foundation had been previously shown the Work, that there was a ‘specific reason’ that the Work was excluded from the Cy Twombly catalog raisonne that was published in 2013, and that the Foundation had previously been in touch with the consignor who should not have consigned the Work for sale.” (NYSCEF 43, answer with counterclaims at 6 at 9.) Grosso claims that this was material information relevant to the subject of the consignment and sale of the Work and Phillips failed to disclose the material information it learned from the Foundation to Grosso. (Id. at
