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Gusinsky v. Barclays PLC

United States District Court, S.D. New York

June 12, 2013

VLADIMIR GUSINSKY, TRUSTEE, FOR THE VLADIMIR GUSINSKY LIVING TRUST, Individually and on Behalf of All Others Similarly Situated, Plaintiff,
v.
BARCLAYS PLC, et al., Defendants

Filed: June 13, 2013.

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For Plaintiffs: David Avi Rosenfeld, Esq., Samuel Howard Rudman, Esq., Christopher Michael Barrett, Esq., Robbins Geller Rudman & Dowd LLP, Melville, NY; Gregory Mark Nespole, Esq., Robert B. Weintraub, Esq., Wolf Haldenstein Adler Freeman & Herz LLP, New York, NY.

For Defendants: Jonathan D. Schiller, Esq., James Meadows, Esq., Boies Schiller & Flexner LLP, New York, NY; Michael Brille, Esq., Boies Schiller & Flexner LLP, Washington, D.C.; David H. Braff, Esq., Jeffrey T. Scott, Esq., Matthew S. Fitzwater, Esq., Matthew J. Porpora, Esq., Sullivan & Cromwell LLP, New York, NY; Andrew J. Levander, Esq., Dechert LLP, New York, NY; Cheryl A. Krause, Esq., Dechert LLP, Philadelphia, PA.

OPINION

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MEMORANDUM OPINION AND ORDER

Shira A. Scheindlin, U.S.D.J.

I. INTRODUCTION

Plaintiffs bring this putative class action against Barclays PLC, Barclays Bank PLC, and Barclays Capital Inc., (collectively, " Barclays" ), and John Varley, Robert Diamond, Christopher Lucas, and Marcus Agius (" Individual Defendants" and, together with Barclays, " Defendants" ).

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The putative class consists of all persons and entities who purchased American Depositary Shares (" ADSs" ) of Barclays PLC between July 10, 2007 and June 27, 2012, inclusive, and were allegedly damaged thereby. Plaintiffs assert violations of: (1) Section 10(b) of the Securities Exchange Act of 1934 (" Exchange Act" ) and Rule 10b-5 promulgated thereunder against all defendants; and (2) Section 20(a) of the Exchange Act against the Individual Defendants.

On May 13, 2013, I granted Defendants' motion to dismiss the Second Amended Complaint (" SAC" ) in its entirety on the grounds that: (1) Plaintiffs failed to allege that Barclays' generic statements about its business practices were actionable misstatements; (2) Plaintiffs did not plausibly allege that Barclays' contingent disclosures were materially misleading; and (3) assuming that Barclays' LIBOR submissions were actionable misrepresentations, Plaintiffs did not adequately allege that these statements, which occurred prior to 2009, caused Plaintiffs' losses in 2012.[1] Because I held that Plaintiffs did not adequately allege a primary violation of Section 10(b), I also dismissed the Section 20(a) claims for control person liability.[2] I denied leave to amend on the ground that amendment would be futile, particularly in light of the fact that Plaintiffs were placed on notice of all the perceived deficiencies in their Complaint and given the opportunity to amend, and still had not plausibly alleged that Defendants' fraud caused their losses.[3] Plaintiffs now move under Local Rule 6.3 for reconsideration of the denial of leave to amend.[4] For the reasons set forth below, Plaintiffs' motion is denied.

II. LEGAL STANDARD

A. Motion for Reconsideration

Motions for reconsideration are governed by Local Rule 6.3 and are committed to the sound discretion of the district court.[5] A motion for reconsideration is appropriate where " 'the moving party can point to controlling decisions or data that the court overlooked -- matters, in other words, that might reasonably be expected to alter the conclusion reached by the court.'" [6] A motion for reconsideration may also be granted to " 'correct a clear error or prevent manifest injustice.'" [7]

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The purpose of Local Rule 6.3 is to " 'ensure the finality of decisions and to prevent the practice of a losing party examining a decision and then plugging the gaps of a lost motion with additional matters.'" [8] Local Rule 6.3 must be " narrowly construed and strictly applied so as to avoid repetitive arguments on issues that have been considered fully by the Court." [9] Such motions should not be made reflexively to reargue " 'those issues already considered when a party does not like the way the original motion was resolved.'" [10] A motion for reconsideration is not an " opportunity for making new arguments that could have been previously advanced," [11] nor is it a substitute for appeal.[12]

B. Leave to Amend

Whether to permit a plaintiff to amend its complaint is a matter committed to a court's " sound discretion." [13] Federal Rule of Civil Procedure 15(a) provides that leave to amend a complaint " shall be freely given when justice so requires." " When a motion to dismiss is granted, the usual practice is to grant leave to amend the complaint," [14] particularly when a complaint is dismissed for failure to plead fraud with adequate specificity under Rule 9(b).[15] Leave to amend should be denied, however, where the proposed amendment would be futile.[16]

III. DISCUSSION[17]

Plaintiffs have not cited any new facts, intervening change in law or possibility of manifest injustice that meets the standard for reconsideration of the Court's dismissal and denial of leave to amend. Plaintiffs argue that the Court recognized the falsity of LIBOR submissions and statements regarding LIBOR, and that " [w]ith respect to certain statements that the Court found were not actionable, the [Proposed Third Amended Complaint (" PTAC" )] now includes further allegations demonstrating the falsity of those statements." [18] Specifically, Plaintiffs argue, the PTAC now alleges that statements regarding Barclays' legal compliance were false because " the violation of

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law alleged here was (i) 'at the direction of members of senior management'; and (ii) was material to the Company and to a reasonable investor since it exposed the Company to substantial financial loss and reputational harm.'" [19] In addition, Plaintiffs argue that the PTAC adequately pleads loss causation " based, in part, on an analysis provided to Plaintiffs by an economics expert on loss causation." [20]

These arguments are unavailing. While it is true that the mandate to " freely give leave [to amend] when justice so requires" is " to be heeded," [21] I determined that it was just to deny such leave where Plaintiffs already had detailed notice of the deficiencies in their Complaint when they first amended -- and such notice was given for the specific purpose of avoiding a second round of amendment.[22] Plaintiffs cite no reason why they could not have raised the allegedly new facts in their SAC, and indeed it is questionable whether Plaintiffs seek to add any materially different facts from those set forth in the SAC. Moreover, to the extent that any new facts are alleged, they do not bring to light new legal arguments, or render plausible the arguments this Court already considered and found lacking. This is a quintessential attempt to reargue " 'those issues already considered when a party does not like the way the original motion was resolved,'" [23] and to mak[e] new arguments that could have been previously advanced," [24] neither of which are proper bases for reconsideration.

IV. CONCLUSION

For the foregoing reasons, Plaintiffs' motion for reconsideration is denied. The

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Clerk of the Court is directed to close this motion (Docket No. 75) and this case.

SO ORDERED


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