McKenzie-Morris v. V.P. Records Retail Outlet, Inc.

Background

In August 2023, the court granted defendants’ second motion to dismiss in part. It held that Shauna McKenzie-Morris’s copyright and fraud claims were barred by the applicable filing deadlines and that her accounting claim was preempted. The court allowed her breach-of-contract claims to proceed. The court had previously determined that the fraud allegations were sufficiently pleaded; the dismissal rested on timeliness, not inadequate pleading.

The court explained that the fraud claim concerned emails sent in July and October 2008. Under the applicable limitations rule, the claim was barred unless McKenzie-Morris could show that she could not have discovered the alleged fraud through reasonable diligence until within the legally permitted period before filing suit. The earlier opinion relied, among other facts, on an email that McKenzie-Morris received and answered. The sender’s signature identified him as a vice-president of V.P. Records, which the court said should have prompted a reasonably diligent person to investigate the relationship between V.P. Records and GPL.

McKenzie-Morris later filed a letter that the court treated as a motion for reconsideration. She argued that her allegations established the elements of fraud and asked the court to consider her position and the evidence showing that she was allegedly misled into believing she was signing a publishing contract with a separate company. She did not make a substantive argument in the motion addressing the court’s conclusion that the fraud claim was time-barred. In her reply, she addressed the limitations ruling and offered what she described as new evidence.

Legal standard

Under Local Rule 6.3, reconsideration is an extraordinary remedy used sparingly. It may be granted when the moving party identifies an intervening change in controlling law, new evidence, a clear error, or a need to prevent serious injustice. The decision whether to reconsider an earlier order is committed to the district court’s discretion.

Analysis and ruling

Judge Gregory H. Woods denied McKenzie-Morris’s motion for reconsideration. The court found no change in controlling law, no new evidence affecting its decision, and no clear error requiring modification of the earlier opinion.

The court also clarified a point it believed McKenzie-Morris misunderstood. The earlier opinion did not hold that she actually knew about the fraud in 2008. Instead, it held that, based on the email and related facts, she could have discovered the alleged fraud through reasonable diligence. The court therefore left its earlier dismissal of the fraud claim in place. The opinion states that McKenzie-Morris’s motion for reconsideration was DENIED.