Kornea v. Miller

Background

Illia Kornea and Octavian Kecenovici, both proceeding without lawyers, alleged that Jeffrey A. Miller, their former business partner and also proceeding without a lawyer, owed them more than $2 million based on transactions involving wholesale quantities of marijuana. The plaintiffs asserted claims for breach of contract, violations of New York Commercial Code Law § 3-501 and California Commercial Code § 3501, and violations of New York General Business Law § 349 and California General Business Regulations § 16000 et seq. Miller asserted counterclaims for breach of the implied covenant of good faith and fair dealing and tortious interference with contractual relations.

Report and Recommendation

Miller moved for summary judgment, a procedure for resolving claims without a trial when the record does not allow a reasonable jury to rule for the opposing party. Magistrate Judge Katharine H. Parker recommended that the court grant the motion in part and deny it in part. Her recommendation would dismiss all claims except the claim that Miller breached the parties’ contract by failing to distribute the full amount of profits before June 2019.

The plaintiffs filed objections to the recommendation. Miller did not object. The district court explained that specific objections require a fresh review of the challenged portions of a magistrate judge’s recommendation, while general or unclear objections are reviewed for clear error, meaning an obvious mistake in the record. The court found that the plaintiffs’ objections were vague and conclusory and did not identify particular findings with which they disagreed.

Court’s Analysis

The plaintiffs appeared to argue that Miller failed to make various payments under the parties’ second agreement. But they did not address Magistrate Judge Parker’s examination of Miller’s bank statements and the parties’ communications. The court agreed that the plaintiffs had not provided enough detail to support their allegations that Miller profited from suspected transactions. It also found no record basis from which a reasonable jury could infer that Miller failed to distribute the plaintiffs’ share of profits for transactions other than those identified in the recommendation, involving the period from May to June 2019.

The court also stated that it generally would not consider new evidence raised in objections to a magistrate judge’s recommendation. It noted that later filings concerning Miller’s divorce were irrelevant to the pending motion and that the plaintiffs’ assertion that Miller’s motion relied on perjured statements lacked a basis in the record.

Disposition

Judge Engelmayer found no clear error in Magistrate Judge Parker’s thorough recommendation and adopted it in full. The court therefore granted Miller’s summary-judgment motion in part and denied it in part. The Clerk of Court was directed to terminate the motion at Docket 91. The opinion leaves as the surviving matter the contract claim concerning Miller’s alleged failure to distribute the full amount of profits before June 2019.