United States District Court, S.D. New York
April 21, 2014
RUSSELL PUBLISHING GROUP, LTD. and JANE RUSSELL, Plaintiffs,
BROWN PRINTING COMPANY, Defendant.
Richard Pu, Esq., Richard Pu, P.C., New York, New York, for Plaintiffs.
John Siegal, Esq., Sammi Malek, Esq., Stephen Langston Ball, Esq., Baker & Hostetler LLP (NYC), New York City, New York, for Brown Printing Company.
MEMORANDUM OPINION AND ORDER
SHIRA A. SCHEINDLIN, District Judge.
In an Opinion and Order on April 3, 2014 ("April 3 Order"), I granted Brown Printing Company's ("Brown") motion to dismiss for failure to state a claim. Plaintiffs now move for reconsideration of the April 3 Order under Local Rule 6.3. For the reasons set forth below, plaintiffs' motion is denied.
II. MOTION FOR RECONSIDERATION STANDARD
"The standard for granting... a motion [for reconsideration] is strict, and reconsideration will generally be denied unless 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." Reconsideration of a Court's previous order is "an extraordinary remedy to be employed sparingly in the interests of finality and conservation of scarce judicial resources." Typical grounds for reconsideration include "an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice."
Plaintiffs have not pointed to any new or overlooked facts, intervening changes in law, or the possibility of manifest injustice. Instead, plaintiffs' motion rehashes arguments that I considered and rejected in the April 3 Order. To the extent I did not fully explain why those arguments lack merit, I will do so now.
First, plaintiffs contend that the Court overlooked the fact that Jane Russell allegedly operated Russell Publishing Group, Ltd. ("RPG") as a "sole proprietorship" and "adopted the contract" with Brown after her husband's death. Here, plaintiffs' own public filings with the Texas Secretary of State directly contradict the claim that RPG is a "sole proprietorship." The records on the Texas Secretary of State's website show that as of October 15, 2013 - one day after plaintiffs filed their Amended Complaint - RPG remained a limited partnership. As a result, Russell lacks standing to sue in her individual capacity.
Second, plaintiffs argue that the Court overlooked facts and law when it dismissed the fraud claim. Plaintiffs reiterate the same facts previously before the Court - e.g., that the monthly bills contained billing errors in Brown's favor, that Brown refused to disclose what it was paying for paper, and that Brown changed its print jobs to increase plaintiffs' costs artificially. But none of these allegations establish Brown's wrongful intent. It is undisputed that Brown made a good faith effort to correct any billing errors.
Similarly, plaintiffs again argue that they are permitted to bring a fraud claim parallel to their contract claim. First, plaintiffs point to the same New York Appellate Division cases that I have already considered and distinguished. The Second Circuit case they now cite - Merrill Lynch & Co. v. Allegheny Energy, Inc.  - is also distinguishable. In Merrill Lynch, Allegheny alleged that Merrill Lynch provided false financial information to induce Allegheny to make an acquisition. The Second Circuit held that the false financial information constituted a misstatement of present fact separate and apart from the purchase agreement, and, therefore, Allegheny could bring a claim for fraudulent inducement. There is no allegation here that the purported billing errors were made to induce plaintiffs to take any action.
In addition, plaintiffs have failed to identify any overlooked facts or law demonstrating that Brown had any legal duty apart from its duty to perform under the contract. Merely describing the parties' relationship as close or trusting is not sufficient to make it anything other than an ordinary, arms' length business relationship. Furthermore, the fact that Brown "had superior knowledge" about printing is irrelevant. Brown is a sophisticated professional printing company and RPG is a sophisticated professional publisher, who has contracted with printers in the past. Brown had no reason to believe it owed RPG a duty of candor.
Third, plaintiffs argue that the Court overlooked facts showing that Brown breached a fiduciary duty. But plaintiffs again cite only to advertising from Brown's website and an email from Brown's president offering to credit plaintiffs' account. Such statements do not show any unique degree of confidence or trust between the parties. Nor have plaintiffs cited any case that imposes a fiduciary duty where two parties engage in an arms-length business transaction.
Finally, plaintiffs cite no facts or law to warrant reconsideration of plaintiffs conversion claim. Based on the contract, Brown could retain plaintiffs' magazines if plaintiffs failed to pay any invoice. Regardless of whether plaintiffs believed they were overcharged, they were contractually obligated to pay. Plaintiffs made no allegation that could support a claim for conversion.
For the foregoing reasons, plaintiffs' motion for reconsideration is DENIED. The Clerk of the Court is directed to close this motion [Docket No. 32]. A conference is scheduled for May 6, 2014 at 4:30 PM.