Hay v. The Gernert Company, Inc.

Background

On January 25, 2023, the court granted the defendants’ motion to dismiss the amended complaint. The court said that Hay could request permission to file another amended complaint by explaining how the proposed pleading would fix the deficiencies identified in that decision.

Hay submitted that request on February 8, 2023. On March 2, 2023, the court granted Hay leave, or permission, to file a second amended complaint. The court determined that facts in Hay’s letter, particularly those in sections one and two, would cure the identified pleading deficiency if included in an amended complaint. The court also found no bad faith and denied Hay’s request to file a reply as moot.

Motion for reconsideration

On March 16, 2023, the defendants moved for reconsideration of the order granting Hay permission to replead. They argued that Hay’s letter did not allege non-speculative proceeds from either Bolonik’s book or Hay’s book, or that the defendants’ alleged fiduciary breaches caused Hay not to receive part of those proceeds. In the alternative, they asked the court to wait to decide whether the second amended complaint was legally sufficient until Hay filed it and the defendants responded.

The court explained that reconsideration is allowed only when the moving party identifies an intervening change in controlling law, new evidence, or a clear error or manifest injustice. It also stated that reconsideration is not a way to repeat arguments already made or obtain another hearing on the same issues.

Court’s reasoning and ruling

The court held that the defendants had not identified any of the required grounds for reconsideration. Their arguments repeated the position taken in their earlier opposition letter, and the court had already considered and rejected those arguments.

The court also addressed the arguments on their substance. It found that the statement that Bolonik had already received an advance that should have been shared with Hay alleged a quantifiable loss. The allegation that Burnes discouraged Bolonik from naming Hay as a co-author and secretly negotiated a book deal for Bolonik alone suggested a connection between the defendants’ conduct and that loss. The court stated that its earlier determination did not control in light of the facts alleged in Hay’s letter.

The court clarified that its March 2 order meant that the facts in the letter would cure the prior pleading deficiency if Hay repleaded them in an amended complaint. The court ordered that the defendants’ motion for reconsideration was denied. It also ordered the defendants to send Hay a copy of the order because he was not represented by counsel, and directed the clerk to close the motion.