Ravi v. Citigroup Global Markets Holdings, Inc.
- Gregory Woods
- 1:21-cv-02223
- U.S. District Court · Southern District of New York
- 5
In Ravi v. Citigroup Global Markets Holdings, Inc., Judge Woods dismissed the amended complaint without prejudice but allowed the plaintiffs to amend again.
Umashankar Ravi and Saritha Ravi may file another amended complaint within 14 days; Citigroup Global Markets Holdings, Inc. obtained dismissal of the amended complaint, but the dismissal was without prejudice.
What happened
Umashankar Ravi and Saritha Ravi sued Citigroup Global Markets Holdings, Inc. over losses they allegedly suffered when the company redeemed exchange-traded notes they had bought. They claimed common-law fraud and violations of the Securities Act of 1933 and represented themselves without lawyers.
A magistrate judge recommended dismissing the amended complaint and denying permission to amend. The plaintiffs objected, but their objections did not identify specific errors, so the court reviewed the recommendation only for obvious error and found none in the recommendation to dismiss.
Judge Woods rejected the recommendation to deny another amendment because it relied only on an earlier warning that the plaintiffs had one last chance to amend. The court dismissed the amended complaint without prejudice and granted the plaintiffs leave to file another amended complaint within 14 days.
The detailed version
- Ravi v. Citigroup Global Markets Holdings, Inc. · No. 1:21-cv-02223
- Gregory Woods
- Jan. 10, 2022
Background
Umashankar Ravi and Saritha Ravi, proceeding without lawyers, sued Citigroup Global Markets Holdings, Inc. to recover losses they allegedly sustained when exchange-traded notes they purchased from the defendant were redeemed. Their amended complaint asserted common-law fraud and violations of the Securities Act of 1933. The defendant moved to dismiss the amended complaint.
Magistrate Judge Kevin Nathaniel Fox issued a report recommending dismissal and recommending that the plaintiffs not be allowed to amend their complaint again. The plaintiffs filed objections.
Review of the Report
The district court explained that objections to a magistrate judge’s report must identify specific findings or recommendations. Because the plaintiffs’ objections did not identify a particular finding and instead largely listed documents or evidence they wanted in discovery, the court reviewed the report only for clear error. Clear-error review asks whether the recommendation contains an obvious mistake.
The court found no clear error in Judge Fox’s recommendation that the amended complaint be dismissed. It therefore adopted that part of the report.
Leave to Amend
The court did not adopt the recommendation to deny leave to amend. It found clear error in relying solely on an earlier order stating that the plaintiffs had one last opportunity to amend before the defendant filed a motion to dismiss. The court explained that this was not a sufficient basis to deny another amendment after the motion to dismiss, and the report did not identify another reason such as futility, bad faith, delay, or prejudice.
The court granted the plaintiffs leave to replead their claims under Federal Rule of Civil Procedure 15. Any amended complaint had to be filed within 14 days of the order.
Disposition
The court adopted Judge Fox’s report except for the recommendation to deny leave to amend, dismissed the amended complaint without prejudice, and directed the clerk to terminate the pending motion at Docket Number 22.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.