Staff-It-Now, LLC v. Kaynes Technology, Inc.

• Court: New Jersey Superior Court Appellate Division
• Decided: October 16, 2024
• Docket: A-3015-22
• Status: Unpublished

Opinion

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-3015-22

STAFF-IT-NOW, LLC, A New York Corporation, and GARY KAIBLE,

Plaintiffs-Appellants,

v.

KAYNES TECHNOLOGY, INC.,

Defendant-Respondent. ______________________________

Submitted October 1, 2024 – Decided October 16, 2024

Before Judges Gooden Brown, Smith and Vanek.

On appeal from the Superior Court of New Jersey, Law Division, Morris County, Docket No. L-2159-20.

Constants Law Offices, LLC, attorneys for appellants (Alfred C. Constants, III, on the briefs).

Gruber, Colabella, Liuzza, Thompson & Hiben, attorneys for respondent (Chris H. Colabella and Samuel C. Colabella, on the brief).

PER CURIAM After a business dispute, a jury awarded $37,800 in damages to plaintiffs.

Plaintiffs now appeal from various orders of the trial court, including certain

pre-trial discovery orders and its order denying plaintiffs' post-trial motion for

reconsideration. Plaintiffs contend they are entitled to a new trial because the

court committed errors before, during, and after trial which affected their ability

to prove damages before the jury, resulting in a lower award. We are not

persuaded and affirm for the reasons which follow.

I.

The salient facts come from testimony at trial. Defendant, Kaynes

Technology (Kaynes) recruits skilled labor, mostly from overseas, for placement

with U.S.-based tech companies. Kaynes places about twenty recruits per year

with two clients, Morgan Stanley and Maintech Inc.

On April 13, 2019, Staff-It-Now and its principal, Gary Kabile (plaintiffs)

entered into an agreement with Kaynes, titled a "Master Service Level

Agreement." The one-page document identified a series of agreed-upon services

the parties would either perform for each other or perform for third-parties on

each other's behalf. At trial, Kabile testified that plaintiffs' role under the

contract was to "open up doors and get opportunities" by referring their long -

standing tech business customers to Kaynes. Kaynes' role was to "go out and

A-3015-22 2 properly recruit consultants to fulfill the [needs] of the [plaintiffs' customers]."

The parties agreed to split profits 70/30 for each recruit they placed with one of

plaintiffs' customers. The parties also agreed to coordinate operational tasks,

like candidate submissions and employer communications, to maximize the

number of Kaynes recruits hired by plaintiffs' customers. Finally, the parties

agreed to "start" their business relationship with Morgan Stanley, a customer of

plaintiffs, that was expressly identified in their agreement.

About eighteen months after the parties signed the agreement, their

relationship splintered. Plaintiffs sued Kaynes in the Law Division, alleging:

breach of contract; breach of covenant of good faith and fair dealing; unjust

enrichment; bad faith; and interference with prospective economic advantage.

The pre-trial discovery phase of the litigation was contentious. Between the

filing of the complaint in October 2020 and the start of trial in April 2023,

plaintiffs filed six separate motions seeking relief for discovery they alleged was

improperly withheld by defendant. We summarize the relevant motion practice

and corresponding orders.

Plaintiffs filed a motion to dismiss defendant's answer, alleging that,

"[d]efendant[] ha[s] denied . . . plaintiff[s] access to various business portals so

[they] are unable to finalize [the] damage calculations and obtain other

A-3015-22 3 necessary proofs." They eventually withdrew the motion and on September 9,

2021, the trial court issued a consent order extending discovery. The order

extended discovery until January 17, 2022, setting deadlines for production of

documents, depositions, and exchange of expert reports.

On December 22, 2021, plaintiffs filed a second motion to dismiss,

alleging defendants failed to comply with the September 9 consent order.

Plaintiffs further alleged Kaynes denied plaintiffs "access to various business

portals," leaving them unable to calculate and present their damages.

In its order denying plaintiffs' second motion to dismiss, the trial court:

granted plaintiffs seventy-two hours access to a digital business portal for

discovery purposes; required, without deadline, all "relevant requests for

depositions and subpoenas be complied with by [d]efendant; granted plaintiffs'

demand for certain meeting notes; denied plaintiffs' demand for certain Kaynes

business and tax documents; and finally, denied plaintiffs' demand for a contract

between co-plaintiff Kabile and one of plaintiffs' customers, Maintech." In its

written statement of reasons, the trial court found plaintiffs had "not shown . . .

specific need of documents that have proprietary implications . . . ."

A-3015-22 4 Plaintiffs filed their fourth motion 1 against both Kaynes and their former

client, Maintech. On June 8, 2022, plaintiffs filed a motion to enforce litigants'

rights, seeking a contempt order against Maintech, and compelling them to

comply with a subpoena served on them by plaintiffs. In a comprehensive order

dated July 5, 2022, the court denied the contempt relief. However, the court

directed Maintech to turn over detailed information to plaintiffs, including but

not limited to: all contracts between Maintech and Kaynes; a list of all Kayn es'

recruits placed at Maintech; the details of each placement, including duration

and amount paid by Maintech; and all relevant accounts payable documentation

and corresponding software needed to access the information.

Plaintiffs also sought relief for discovery which they continued to allege

Kaynes failed to produce. In a separate order dated July 15, 2022, the court

directed Kaynes to provide certain discovery, including: contracts between the

parties and Maintech; various documents Kaynes consented to turn over during

depositions of its principals; Kaynes/Maintech billing reports; Kaynes/Morgan

Stanley billing reports; Kaynes spreadsheets containing details about Maintech

job placements and fees paid to Kaynes; and emails between Kaynes and Kabile.

1 We omit a recitation of the facts and procedural history of plaintiffs' third motion as it is unnecessary to decide the appeal. A-3015-22 5 Included in the same order were discovery-related case management

directives. The court ordered that Kaynes turn over all documentary discovery

on or before July 28, 2022. Depositions were to be completed by August 10.

Plaintiffs were given access to the Kaynes' digital portal until August 20. The

discovery end date was extended to August 30.

Plaintiffs were unsuccessful in getting Maintech, a business domiciled in

New York, to fully comply with the court's July 5 order or with subpoenas.

Plaintiffs filed a fifth motion on August 22, again seeking to enforce

litigants' rights against Maintech, based on the court's July 5 order. Kaynes

moved for reconsideration of the court's July 15 order, arguing that plaintiffs

had no business relationship with Maintech, and that the information the court

ordered to be turned over to plaintiffs regarding Kaynes' business relationship

with Maintech was proprietary.

On October 14 the court denied plaintiffs' motion as to Maintech and

granted Kaynes' motion for reconsideration. On reconsideration, the trial court

rescinded its order of July 15. It stated:

Defendant maintains they have no documents from Maintech. They are however, obligated to provide any such documents that come into their possession. To support the argument that no such documents exist, [d]efendant granted to [plaintiff] access to its computer portal. Plaintiff to date has not availed itself of that

A-3015-22 6 opportunity. The court . . . is inclined to provide a thirty (30) day extension for [p]laintiff to review the relevant documents on the portal pertaining to Maintech.

Finally, on November 29, 2022, plaintiffs filed a sixth motion, again to

dismiss defendants' answer and counterclaims for failure to provide discovery.

On March 6, 2023, the trial court denied the motion, issuing a written statement

of reasons. The court rejected plaintiffs' argument that Kaynes violated the July

15 order, noting that it had rescinded that order on October 14. The court stated,

"[t]he court . . . finds that [d]efendant has complied with this [c]ourt's [order]

and has satisfactorily provided [p]laintiff with all [c]ourt ordered discovery."

After the two-day trial in April 2023, a jury found for plaintiffs, who then

filed a motion for reconsideration. On reconsideration, plaintiffs sought

discovery after the verdict, including: accounts payable documents for Morgan

Stanley and Maintech; documents evidencing communications between Kaynes

and Maintech; documents regarding Kabile's email account in the possession of

Kaynes; and Kaynes' W-9 tax forms.

The court made findings. First, the court found the motion for

reconsideration was out of time, as much of what plaintiffs sought and argued

was decided by the trial court in motion practice long before trial. The record

shows plaintiffs raised one trial-related issue on reconsideration, the court's

A-3015-22 7 order barring the admission of certain Maintech-related documents during trial.

At trial the court found plaintiffs failed to supply the documents to Kaynes prior

to the discovery end date, and it granted Kaynes' motion to bar them. On

reconsideration, the trial court determined plaintiffs had not met the standard set

forth in Rule 4:49-2 and denied the motion. Plaintiffs appealed.

II.

We review each of the issues on appeal using an abuse of discretion

standard, and we recite the well-settled principles which control. We review

discovery orders for abuse of discretion. Capital Health Sys. v. Horizon

Healthcare Servs., 230 N.J. 73, 79 (2017). "[A]ppellate courts are not to

intervene but instead will defer to a trial judge's discovery rulings absent an

abuse of discretion or a judge's misunderstanding or misapplication of the law."

Id. at 79-80 (citing Pomerantz Paper Corp. v. New Cmty. Corp., 207 N.J. 344,

371 (2011)).

We review a trial court's decision to admit or exclude evidence for abuse

of discretion. Est. of Hanges v. Metro. Prop. & Cas. Ins. Co., 202 N.J. 369, 383-

84 (2010). We will not disturb a trial court's evidentiary rulings unless they are

"so wide off the mark that a manifest denial of justice resulted." Green v. N.J.

A-3015-22 8 Mfrs. Ins. Co., 160 N.J. 480, 492 (1999) (quoting State v. Carter, 91 N.J. 86,

106 (1982)).

We also review a trial judge's decision on whether to grant or deny a

motion for reconsideration under Rule 4:49-2 (motion to alter or amend a

judgment order) for an abuse of discretion. Branch v. Cream-O-Land Dairy,

244 N.J. 567, 582 (2021); Kornbleuth v. Westover, 241 N.J. 289, 301 (2020);

Hoover v. Wetzler, 472 N.J. Super. 230, 235 (App. Div. 2022); Pitney Bowes

Bank, Inc. v. ABC Caging Fulfillment, 440 N.J. Super. 378, 382 (App. Div.

2015). "The rule applies when the court's decision represents a clear abuse of

discretion based on plainly incorrect reasoning or failure to consider evidence

or a good reason for the court to reconsider new information." Pressler &

Verniero, Current N.J. Court Rules, cmt. 2 on R. 4:49-2 (2022).

III.

We briefly consider defendant's argument that plaintiffs are barred from

challenging the court's pre-trial discovery orders on appeal.

"When a party appeals from a final judgment, the party may seek review

of interlocutory orders that have not been rendered moot or definitively ruled

upon by an appellate court in a prior or separate appeal." Silviera-Francisco v.

Bd. of Educ. of Elizabeth, 224 N.J. 126, 140-41 (2016) (citing Elmora Hebrew

A-3015-22 9 Ctr., Inc. v. Fishman, 239 N.J. Super. 229, 232 (App. Div. 1990), aff'd, 125 N.J.

404 (1991)). "An interlocutory order is preserved for appeal with the final

judgment or final agency decision if it is identified as a subject of the appeal.

That may be done in the notice of appeal or the case information statement." Id.

at 141 (citations omitted).

Plaintiffs' notice of appeal challenges the order of judgment and the trial

court's denial of reconsideration. However, plaintiffs' case information

statement (CIS) references the "numerous motions for discovery" they filed, and

their efforts to seek relief through motion practice. We find plaintiffs'

identification of the various discovery orders in their CIS sufficient to consider

their arguments on the merits.

We turn to plaintiff's argument that the trial court committed error in its

series of discovery orders. Plaintiffs argue the court should have required

Kaynes to produce certain documents. Plaintiffs fail to specify which of the six

discovery orders were issued in error, essentially arguing that the cumulative

effect of the orders constitutes abuse of discretion. We disagree.

The trial court was unpersuaded by plaintiffs' contention that the digital

portal did not contain all the Morgan Stanley documents plaintiffs sought in

discovery. The parties thoroughly litigated the question, with plaintiffs

A-3015-22 10 repeatedly seeking relief via motion. The trial court's understanding of the

dispute over Morgan Stanley records evolved with each successive motion. We

see nothing in the record from which we could conclude the trial court

misunderstood or misapplied the law, and we decline to intervene. Capital

Health Sys., 230 N.J. at 79-80.

We next consider the Maintech discovery dispute. The record shows the

trial court found credible Kaynes' assertion that it had no Maintech documents.

Maintech, while a central figure in the litigation, was not a party. As such,

plaintiffs had ample opportunity over the extended discovery period to subpoena

Maintech-related witnesses for deposition and subpoena Maintech for the

production of relevant documents. The record shows plaintiffs were less than

successful in their efforts to secure witnesses or documents related to Maintech.

These significant discovery defects, which plaintiffs insist hurt their case for

damages before the jury, cannot be laid at the feet of the trial court. We discern

no abuse of discretion or misapplication of the law regarding the court's

discovery orders as they relate to Maintech.

Plaintiffs also argue the trial court erred when it barred certain Maintech

business records at trial. Plaintiffs contend these documents were central to their

damages case at trial. The record shows the disputed documents to be three

A-3015-22 11 pages which were a part of exhibit P-3. The business records were produced by

Maintech, not Kaynes. The trial court found plaintiffs failed to lay a sufficient

foundation at trial regarding the Maintech business records and barred their

admission into evidence. Because plaintiffs did not produce the records, co-

plaintiff Kabile's testimony about them was insufficient. There is no reason to

disturb the court's decision to bar the Maintech records, and we find no abuse of

discretion. Est. of Hanges, 202 N.J. at 383-84.

Given our analysis, it follows that the trial court's denial of

reconsideration was proper.

Any contentions raised by plaintiffs on appeal not addressed here lack

sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).

Affirmed.

A-3015-22 12