Anwar v. Fairfield Greenwich Ltd.

283 F.R.D. 193, 82 Fed. R. Serv. 3d 1107, 2012 U.S. Dist. LEXIS 90043, 2012 WL 2457734
Procedural entryThis page is a short order in Anwar v. Fairfield Greenwich Ltd.. Read the opinion of the Court — 728 F. Supp. 2d 372
District Court, S.D. New York·Decided June 22, 2012·No. Nos. 09 Civ. 0118(VM)(THK), 09 Civ. 8500 (Headway), 10 Civ. 0920 (Maridom)·Published

Opinion

DECISION AND ORDER

VICTOR MARRERO, District Judge.

By Decision and Order dated April 13, 2012 (the “April 13 Order”), the Court denied leave to amend the complaints of plaintiffs Headway Investment Corp. (“Headway”), and Maridom Ltd., Caribetrans, S.A., and Abbot Capital, Inc. (with Maridom Ltd. and Caribetrans, S.A., the “Maridom Plaintiffs”). (See Docket No. 853.) Headway and the Maridom Plaintiffs (together, “Plaintiffs”) had sought to add new defendants, claims, and factual allegations to their respective complaints. (See Docket Nos., 815, 838.) Specifically, the Court denied Headway’s request to amend its Complaint by adding: 1) Standard Chartered International (USA) Ltd. (“SCI”), PricewaterhouseCoopers Netherlands (“PwC Netherlands”), and PrieewaterhouseCoopers Canada (“PwC Canada”) as defendants; 2) claims of aiding and abetting breach of fiduciary duty, fraudulent and negligent misrepresentation, and violations of Florida’s Securities and Investor Protection Act, Fla. Stat. § 517.301 (“FSIPA”); and 3) additional factual allegations. (See Docket No. 838, 840.) The Court also denied the Maridom Plaintiffs’ request to amend their Amended Complaint by adding: 1) SCI and Standard Chartered Bank (“SCB”) as defendants; 2) claims for aiding and abetting breach of fiduciary duty, negligence, and a violation of the FSIPA; and 3) additional factual allegations. (See Docket No. 815, 819.)

Plaintiffs now move for reconsideration of the April 13 Order pursuant to Local Rule 6.3 (“Rule 6.3”). (See Docket Nos. 858, 860.) For the reasons discussed below, Plaintiffs motions for reconsideration are DENIED.

I. DISCUSSION

Reconsideration of a previous order by the court is an “extraordinary remedy to be employed sparingly in the interests of finality and conservation of scarce judicial resources.” In re Health Mgmt. Sys., Inc. Sec. Litig., 113 F.Supp.2d 613, 614 (S.D.N.Y. 2000) (internal citations and quotation marks omitted). “The provision for reargument is not designed to allow wasteful repetition of arguments already briefed, considered and decided.” Schonberger v. Serchuk, 742 F.Supp. 108, 119 (S.D.N.Y.1990). “The major grounds justifying reconsideration are ‘an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.’ ” Virgin Atl. Airways, Ltd. v. Nat'l Mediation Bd., 956 F.2d 1245, 1255 (2d [196]*196Cir.1992) (quoting 18 C. Wright, et al., Federal Practice & Procedure § 4478 at 790).

To these ends, a request for reconsideration under Rule 6.3 must demonstrate controlling law or factual matters put before the court in its decision on the underlying matter that the movant believes the court overlooked and that might reasonably be expected to alter the conclusion reached by the court. See Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir.1995). Rule 6.3 is intended to “ ‘ensure the finality of decisions and to prevent the practice of a losing party ... plugging the gaps of a lost motion with additional matters.’ ” Sec. and Exch. Comm’n v. Ashbury Capital Partners, No. 00 Civ. 7898, 2001 WL 604044, at *1 (S.D.N.Y. May 31, 2001) (quoting Carolco Pictures, Inc. v. Sirota, 700 F.Supp. 169, 170 (S.D.N.Y. 1988)). A court must narrowly construe and strictly apply Rule 6.3 so as to avoid duplicative rulings on previously considered issues and to prevent Rule 6.3 from being used to advance different theories not previously argued, or as a substitute for appealing a final judgment. See Montanile v. Nat’l Broad. Co., 216 F.Supp.2d 341, 342 (S.D.N.Y.2002); Shamis v. Ambassador Factors Corp., 187 F.R.D. 148, 151 (S.D.N.Y.1999).

Plaintiffs argue that in deciding their motions to amend, the Court applied the “good cause” standard required by Federal Rule of Civil Procedure 16(b) (“Rule 16(b)”) rather than the “lenient standard” of Federal Rule of Civil Procedure Rule 15(a) (“Rule 15(a)”), and that this ruling constituted clear error. They also argue that the Court’s finding of “undue delay” and prejudice to the defendants was clear error and will create a manifest injustice. Specifically, Plaintiffs contend that they have not been dilatory in prosecuting the case or conducting discovery, and that they waited to amend the complaints until evidence uncovered in discovery supported their new allegations.

A. PLAINTIFFS’ PROPOSED FRAUD-BASED CLAIMS

First, the Court emphasizes while it applied the Rule 16(b) standard to the Plaintiffs’ motions for leave to amend, it did so because at the time the Maridom Plaintiffs sought to amend the complaint, a case management plan and scheduling order were in effect, and the deadline for completion of fact discovery—after the parties to this litigation had spent a long, arduous and costly period gathering evidence—was about to expire. Nonetheless, the Court simultaneously found that “even under the more lenient standard applied when there has been no prior deadline to amend [i.e., Rule 15(a) ], granting leave to amend would prejudice [defendants].” (See Docket No. 853, at 6.) Thus, regardless of which standard the Court applied, no grounds for reconsideration exist because it could not “reasonably be expected to alter the conclusion reached by the court.” Shrader, 70 F.3d at 257.

The Court properly applied the Rule 16(b) “good cause” standard in evaluating the Maridom Plaintiffs’ request to add a claim under the FSIPA. In the Court’s Decision and Order dated October 4, 2010 (the “October 2010 Order”), see Anwar v. Fairfield Greenwich Ltd., 745 F.Supp.2d 360 (S.D.N.Y. 2010), the Court dismissed certain of the Maridom Plaintiffs’ fraud and negligent misrepresentation claims due to lack of specificity regarding the context of the alleged misrepresentations. Id. at 372-73. The Court then granted “leave to replead upon submitting to the Court, within twenty-one days of this Order, an application therefor plausibly showing how such repleading would correct the deficiencies in the Court’s findings discussed above, and thus would not be futile.” Id. at 379. Although framed as a “repleading” rather than an amendment, the import of the October 2010 Order was the same as setting a deadline for amendment: if the Maridom Plaintiffs wished to reinstate the fraud-based claims, they had twenty-one days to persuade the Court that they could amend those claims to cure the deficiencies.

Now, well over a year later, the Maridom Plaintiffs seek to add a statutory fraud claim under section 301 of the FSIPA, the elements of which are almost identical to common law fraud. See Arnold v. McFall, 839 F.Supp.2d 1281, 1286 (S.D.Fla.2011) (“[I]n order to state a claim under Section 301 [of the FSIPA], a plaintiff must allege the following: (1) that a defendant made a mis[197]*197statement or omission (2) of a material fact (3) with scienter (4) upon which the plaintiff relied.”).

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Anwar v. Fairfield Greenwich Ltd., 283 F.R.D. 193, 82 Fed. R. Serv. 3d 1107, 2012 U.S. Dist. LEXIS 90043, 2012 WL 2457734 (S.D.N.Y. 2012).

283 F.R.D. 193 (Anwar v. Fairfield Greenwich Ltd.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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