Kumaran v. Northland Energy Trading, LLC

Background

Samantha Siva Kumaran and The A Star Group, Inc., doing business as Timetrics, sued Northland Energy Trading, LLC, Hedge Solutions, Inc., Richard Larkin, Daniel Lothrop, and Domenic Bramante. Kumaran proceeded without a lawyer, while Timetrics was represented by counsel. Plaintiffs alleged that they had licensed proprietary software, hedging strategies, and techniques to Northland and Hedge, and that the defendants later copied or misused them.

The parties had previously litigated and settled related claims. In 2016, Kumaran, Timetrics, Northland, and Hedge signed a settlement agreement containing a broad release of claims that could have been asserted in the earlier lawsuit. The agreement also included promises concerning the defendants’ possession and use of Timetrics software and strategies. Plaintiffs alleged that the defendants breached those promises and also alleged an unwritten or unfinished agreement involving Larkin, proprietary information, services, and funding for a proposed hedge fund.

The court had previously dismissed Plaintiffs’ First Amended Complaint for failure to state a claim. That pleading contained 16 claims and more than 320 paragraphs. In the earlier ruling, the court also denied other pending requests, including a request for a preliminary injunction, as moot. Plaintiffs then filed several motions asking the court to reconsider the dismissal.

Arguments on Reconsideration

Plaintiffs argued that the court had been biased against people representing themselves, had failed to read Kumaran’s filings liberally, had misrepresented the settlement agreement and the allegations, and had improperly denied leave to file another amended complaint. They also argued that the court should have considered an assertion made in their opposition briefs that they had given defendants notice of an alleged breach of the settlement agreement.

The court rejected those arguments. It said it had reviewed the amended complaint, the incorporated contracts, and the parties’ arguments, and had given Kumaran substantial procedural latitude, including permission to file overlength opposition briefs. The court concluded that the assertion about notice was not consistent with the amended complaint’s allegations and was presented in briefs signed by counsel without identifying which portions had been prepared by Kumaran.

The court also rejected Plaintiffs’ arguments concerning the alleged agreement with Larkin. The amended complaint stated that the parties never signed a finished agreement and that there was no express contract. The court therefore declined to disregard those allegations when evaluating the claims. It likewise concluded that Plaintiffs’ general allegations about their software and risk-management tools did not establish a plausible trade-secret claim and that Plaintiffs were trying to relitigate issues already decided.

Ruling

A motion for reconsideration is an extraordinary request generally limited to situations involving an overlooked controlling decision or fact, a change in controlling law, new evidence, clear error, or manifest injustice. The court held that Plaintiffs had not identified a basis for reconsideration. It remained convinced that the amended complaint failed to state claims on which relief could be granted and that it had acted within its discretion in denying further leave to amend.

Judge Mary Kay Vyskocil denied Plaintiffs’ motions for reconsideration. She also denied Plaintiffs’ belated motions for permission to file excess pages, although she read and considered the excess pages that had already been filed. The court instructed Plaintiffs not to file further requests for relief in the case unless and until the Court of Appeals for the Second Circuit issued a mandate to the contrary, and directed the Clerk to terminate the specified motions.

Classification

This is a procedural order because the court denied reconsideration of an earlier dismissal rather than deciding the underlying claims anew.