United States District Court, S.D. New York
ELSEVIER INC., ELSEVIER B.V., ELSEVIER LTD., and ELSEVIER MASSON SAS, Plaintiffs,
PIERRE GROSSMANN, IBIS CORP., PUBLICAÇÕES TÉCNICAS INTERNACIONAIS, and JOHN DOE Nos. 1-50, Defendants.,
OPINION AND ORDER
KATHERINE POLK FAILLA, District Judge
before the Court is a motion for summary judgment filed by
Plaintiffs Elsevier Inc., Elsevier B.V., Elsevier LTD., and
Elsevier Masson SAS (collectively, “Elsevier”).
The motion seeks judgment as a matter of law as to a single
element of a claim Elsevier pursued at trial - an element
that, due to an intervening change in law during the pendency
of the parties' post-trial motions, Elsevier failed to
prove at trial. As discussed below, Defendant Pierre
Grossmann (“Grossmann”) has not filed any
opposition. For the reasons that follow, the Court grants
Elsevier's Complaint and the Ensuing Trial
following section discusses the underlying facts in this case
only to the extent necessary to dispose of the instant
motion, as the Court has previously engaged in factual
recitations at some length. See Elsevier Inc. v.
Grossmann, No. 12 Civ. 5121 (KPF), 2017 WL 3393848, at
*1-2 (S.D.N.Y. Aug. 7, 2017); Elsevier, Inc. v.
Grossman, 199 F.Supp.3d 768, 773-78 (S.D.N.Y. 2016),
order clarified sub nom. Elsevier Inc. v. Pierre
Grossmann, IBIS Corp., No. 12 Civ. 5121 (KPF), 2016 WL
7077037 (S.D.N.Y. Dec. 2, 2016); Elsevier, Inc. v.
Grossman, 77 F.Supp.3d 331, 337-41 (S.D.N.Y. 2015). In
brief, Elsevier brought this action to recover for sales of
academic journals to Defendants - a Brazilian subscription
agency, its related U.S.-facing company, and the principal of
both - at discounted rates based on Defendants'
representations that they were buying the journals for
“valid personal use.” Elsevier, Inc.,
199 F.Supp.3d at 774. As it turned out, the subscription
agency purchased the journals on behalf of institutions that
would have otherwise paid significantly higher prices.
defense counsel withdrew from the case, Elsevier obtained
default judgments against the corporate defendants, and
Grossmann, proceeding pro se, became the lone
defendant to proceed to trial on January 11, 2016. See
Elsevier, Inc., 199 F.Supp.3d at 775-76. Elsevier's
evidence at trial proved that Grossmann, through his
subscription agency Publicações Técnicas
Internacionais, fraudulently obtained subscriptions to
Elsevier's journals and resold them to Brazilian
institutions. See Id. at 776. The jury thus awarded
a verdict to Elsevier, finding Grossmann liable for violating
the Racketeer Influenced and Corrupt Organizations Act
(“RICO”), breach of contract, and conversion.
Post-Trial Motion Practice
and Grossmann then participated in extensive post-trial
motion practice. Of relevance here, Elsevier moved under
Federal Rule of Civil Procedure 50(b) for judgment as a
matter of law or, alternatively, for a new trial under
Federal Rule of Civil Procedure 59(a) on the amount of RICO
damages the jury awarded. (Dkt. #185). For his part,
Grossmann moved for judgment as a matter of law as to the
RICO claim on the basis that, inter alia, the claim
was an improper extraterritorial application of RICO. (Dkt.
#194, at 5-6). Auspiciously for Grossmann, during the
pendency of the post-trial motions, the Supreme Court decided
RJR Nabisco, Inc. v. European Community, holding
that “[a] private RICO plaintiff must … allege
and prove a domestic injury to its business or
property” to prevail. - U.S. -, 136 S.Ct. 2090, 2106
(2016) (emphasis removed).
supplemental briefing, the Court held that the trial evidence
had not established a domestic injury to Elsevier, nor had
Elsevier pled any domestic injury in its complaint. See
Elsevier, Inc., 199 F.Supp.3d at 787-90. In doing so,
the Court considered two potential grounds for finding a
domestic injury based on Elsevier's trial evidence: (i) a
competitive injury to Elsevier's business and (ii) an
injury in the form of Elsevier selling its property under
false pretenses. See Id. at 787-88. Yet evidence of
ties to the United States under either theory was lacking.
Any competitive injury occurred only in Brazil, where
Defendants resold the journals, and even if Elsevier had
parted with the journals under false pretenses, the evidence
did not show that Elsevier had done so in the United States.
See Id. at 787-90.
Court thus granted Grossmann's motion for judgment as a
matter of law as to the RICO claim. See Elsevier,
Inc., 199 F.Supp.3d at 796. But considering the
intervening change in law under RJR Nabisco and the
interplay between Federal Rules of Civil Procedure 59 and 15,
the Court allowed Elsevier to file a renewed motion for a new
trial and a motion to amend the pleadings to conform to any
new evidence, provided that Elsevier proffer the evidence
that it would offer at trial on the issue of domestic injury.
Id. at 790-92. The Court also advised Elsevier that
evidence supporting a theory of domestic injury in the form
of selling the journals under false pretenses should show
that Elsevier relinquished control of the journals in the
United States by shipping them from the States or through its
domestic employees' shipment authorizations. See
Id. at 790.
on February 15, 2017, Elsevier moved for a new trial and to
amend its complaint. (Dkt. #297). As the Court reviews more
fully below, Elsevier proffered the declaration of Elsevier
employee Maribel Burgos, along with supporting exhibits, in
which she testified that “48 of the 51 fraudulent
subscriptions” involved in the case “were either
physically shipped from the United States or were authorized
for shipment by an Elsevier employee located in the United
States.” (Dkt. #298, ¶ 6). Elsevier also submitted
a proposed amended complaint. (Dkt. #299, Ex. 1). Finding
Elsevier's proffer sufficient to warrant a new trial and
good cause for amendment, the Court granted Plaintiff's
motions. See Elsevier Inc. v. Grossmann, No. 12 Civ.
5121 (KPF), 2017 WL 1843298, at *10 (S.D.N.Y. May 8, 2017).
Accordingly, on September 15, 2017, Elsevier moved for
summary judgment on the issue of domestic injury.
(See Dkt. #384-87).
related consideration, with which the parties are well
acquainted, is worth mentioning. Over the course of this
litigation, Grossmann has engaged in - and received sanctions
for - what the Court has previously characterized as
“shockingly inappropriate, harassing conduct.”
Elsevier Inc., 2017 WL 3393848, at *2. At this
juncture, the Court need not delve into the details of
Grossmann's behavior, save to say that one such sanction
was the Court barring him from introducing any evidence on
the issue of domestic injury. See Id. at *5. For
this reason, Elsevier's motion for summary judgment is
unopposed. In addition, since the Court ...