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Thorsen v. Sons of Norway

United States District Court, E.D. New York

May 14, 2014

THEODORE THORSEN, CHRISTINE M. THORSEN, and DAVID M. THORSEN, both INDIVIDUALLY and DERIVATIVELY ON BEHALF OF SONS OF NORWAY, INC., Plaintiffs,
v.
SONS OF NORWAY, EIVIND HEIBERG, DAN RUDE, and DAVID NESS, Defendants.

MEMORANDUM & ORDER

PAMELA K. CHEN, District Judge.

Plaintiffs presently move for reconsideration of the Court's dismissal, with prejudice, of Plaintiffs' complaint on the basis that they were denied the opportunity to amend the complaint to allege additional facts that would have adequately stated a claim of defamation per se. Because Plaintiffs were given ample opportunity to allege any additional facts necessary to defeat the dismissal motion, and because the requested amendment would have been futile, Plaintiffs' request for reconsideration is denied.

BACKGROUND

Plaintiffs' complaint ("Complaint"), filed on April 27, 2013, asserted four causes of action: (1) a derivative claim on behalf of Sons of Norway against the individual defendants for breach of fiduciary duty; and (2) three claims against Sons of Norway alleging (a) defamation per se, (b) defamation, and (c) intentional infliction of emotional distress. (Dkt. 1 at 38-45.) On July 8, 2013, the Court set a briefing schedule in connection with Defendants' proposed motion to dismiss the Complaint pursuant to Federal Rules of Civil Procedure ("FRCP") 12(b)(1) and 12(b)(6). On August 26, 2013, Plaintiffs sought leave to file an amended complaint, arguing, in substance, that the amended complaint would defeat some of Defendants' dismissal arguments. (Dkt. 28 at 3.) That same day, the Court denied Plaintiffs' request to file an amended complaint, but allowed them to "include in [their] dismissal opposition all of the factual allegations [they] would assert in an amended complaint to establish personal jurisdiction." (August 26, 2013 Order.)

On September 12, 2013, the parties submitted the fully briefed motion. Plaintiffs' opposition to the motion included a section titled "Allegations of the Proposed Amended Complaint" ("Additional Allegations"). (Dkt. 48 at 4-7.) The Additional Allegations included several paragraphs regarding the basis for the Court's personal jurisdiction over the individual defendants. Additionally, and in disregard of the Court's order, Plaintiffs also included numerous newly asserted facts regarding the substance of their claims. Most pertinently, Plaintiffs alleged a new statement that they claimed was defamatory, viz., that non-defendant Paul Kornbrekke stated that "David Thorsen stole money from Nansen Lodge." (Dkt. 48 at 6.)[1] In a footnote, Plaintiffs purported to "reserve their right[s]" to allege additional facts in an amended complaint, and that the Additional Allegations did not "comprise every additional allegation they may choose to make" if granted leave to amend. (Dkt. 48 at 4 n.3.)

Two months later, on November 12, 2013, Plaintiffs submitted a request for leave to submit a sur-reply in further opposition to the motion or for oral argument. (Dkt. 49.) The Court granted Plaintiffs' request to submit a sur-reply (November 13, 2013 Order), which Plaintiffs submitted on November 28. (Dkt. 51.)[2] The sur-reply did not address Plaintiffs' defamation claims.

The Court granted Defendants' motion to dismiss the Complaint on February 6, 2013. (Dkt. 53.) First, the Court found that it had personal jurisdiction over the Defendants. Second, the Court addressed each of Plaintiffs' substantive claims, finding that each failed to state a claim upon which relief could be granted. (Dkt. 53.) On February 20, 2013, Plaintiffs timely moved for reconsideration of the grant of dismissal. (Dkts. 55-56.) Plaintiffs seek reconsideration of the Court's "dismissal of the Complaint with prejudice and dismissal of Count Two [defamation per se ]." (Dkt. 56 at 5.) Plaintiffs also move the Court to "alter or amend the Judgment so that Plaintiffs may file an amended complaint." (Dkt. 56 at 5.)[3]

STANDARD FOR RECONSIDERATION

A motion for reconsideration is the proper vehicle for bringing to the Court's attention matters it may have overlooked in its initial ruling or order. See Local Civil Rule 6.3. The grounds for 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 Cir. 1992). "The standard for granting [a reconsideration motion] 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." Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir. 1995) (citations omitted). "It is well-settled that [a motion for reconsideration] is not a vehicle for relitigating old issues, presenting the case under new theories, securing a rehearing on the merits, or otherwise taking a second bite at the apple." Analytical Surveys, Inc. v. Tonga Partners, L.P., 684 F.3d 36, 52 (2d Cir.), as amended (July 13, 2012) (quotations omitted). Furthermore, arguments raised for the first time on reconsideration are not proper grounds for reconsideration. See Image Processing Techs., LLC v. Canon Inc., 10-CV-3867, 2012 WL 253097, at *1 (E.D.N.Y. Jan. 26, 2012) ("[A] party is not permitted to advance new facts, issues or arguments not previously presented to the Court' on a motion for reconsideration.") (citing Caribbean Trading & Fid. Corp. v. Nigerian Nat'l Petroleum Corp., 948 F.2d 111, 115 (2d Cir. 1991)). "[A] party requesting [reconsideration] is not supposed to treat the court's initial decision as the opening of a dialogue in which that party may then use Rule [6.3] to advance new facts and theories in response to the court's rulings." Church of Scientology Int'l v. Time Warner, Inc., 92-CV-3024, 1997 WL 538912 (S.D.N.Y. Aug. 27, 1997). "The purpose of the rule 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.'" Woodard v. Hardenfelder, 845 F.Supp. 960, 966 (E.D.N.Y. 1994) (quoting McMahan & Co. v. Donaldson, Lufkin & Jenrette, 727 F.Supp. 833, 833 (S.D.N.Y. 1989)).

DISCUSSION

Here, Plaintiffs point to no intervening change of controlling law or extant controlling law that the Court overlooked. Plaintiffs likewise do not contend that the Court overlooked any facts or that new evidence is available. Rather, in essence, Plaintiffs contend that they would be able to assert new facts to save their defamation claims had they been given the opportunity to amend their complaint, and that the Court unfairly denied them the opportunity to plead additional facts by denying their motion to amend and then dismissing this action with prejudice. (Dkt. 56 at 7-8.) As discussed below, this argument is factually and legally incorrect.

I. Plaintiffs Had Ample Opportunity to Allege All Facts Relevant to the Dismissal Motion

Plaintiffs argue that reconsideration is warranted because they were denied the opportunity to allege additional, new facts that would have been sufficient to state a claim for defamation per se. (Dkt. 56 at 2.) However, as Plaintiffs acknowledge, although granted the limited opportunity to allege new facts about personal jurisdiction, Plaintiffs used that opportunity to also allege new facts "addressing Defendants' concerns as to the specificity with which Plaintiffs pleaded defamation and defamation per se." (Dkt. 56 at 2.) Based on a declaration submitted by their counsel, Plaintiffs additionally alleged, inter alia, that (1) at a Nansen Lodge meeting, Sons of Norway member "Paul Kornbrekke published the defamatory statement that David Thorsen stole money from Nansen Lodge", and (2) the "Committee [on which Defendants sat] was informed about the meeting, and the risk that defamatory statement would be published during the meeting [] before the meeting occurred." (Dkt. 48 at 17 (emphasis added).) Using these newly alleged facts, Plaintiffs argued in its dismissal opposition that they had stated a "legally cognizable claim for defamation" and that Defendants were vicariously liable for this purportedly defamatory act. (Dkt. 48 at 17-18.)[4] Thus, contrary to Plaintiffs' argument in this motion, they, in fact, availed themselves of the opportunity to put forth those facts they believed were necessary to adequately plead their defamation claims and defeat Defendants' motion to dismiss.

In deciding the motion to dismiss, the Court considered the additional facts asserted by Plaintiffs in support of their defamation claims. However, as the Court explained in its decision, those additional facts were insufficient to state a claim of defamation or defamation per se. (Dkt. 43 at 27-30.) With respect to the defamation claim, neither the Complaint nor the Additional Allegations alleged any "special damages" that flowed from the defamatory statement.[5] Thai v. Cayre Grp., Ltd., 726 F.Supp.2d 323, 329 (S.D.N.Y. 2010) (to state a claim for defamation under New York Law, plaintiff must allege, inter alia, that the allegedly false statement constituted defamation per se or caused "special damages") (citing Gargiulo v. Forster & Garbus, Esqs., 651 F.Supp.2d 188, 192 (S.D.N.Y. 2009)). With respect to the claim of defamation per se, neither the Complaint nor the Additional Allegations alleged facts establishing that Plaintiff had been accused of a "serious crime." Zherka, 634 F.3d at 645 n.6 (defamation per se may exist where defendant's statement charged plaintiff with a "serious crime"). Rather, Plaintiffs, after taking the opportunity, on its own, to supply additional facts to "address[] Defendants' concerns as to the specificity with which ...


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