Sharma v. Crosscode, Inc.
| Decision Date | 17 March 2022 |
| Docket Number | 21-cv-01766 (SRN/BRT) |
| Court | U.S. District Court — District of Minnesota |
| Parties | Aditya R. Sharma, Plaintiff, v. Crosscode, Inc., CodeLogic, Inc., Greg Wunderle, Rahul Gandhi, Robert Clifford, Keith Archer, Emily Wang Fairbairn, Robert Levy, and Brian Cullinan, Defendants. |
Aditya R. Sharma, Pro Se Plaintiff.
Robert J. Gilbertson and Virginia R. McCalmont, Forsgren, Fisher McCalmont, DeMarea, Tysver, LLP, Elizabeth Brannen, Stris & Maher LLP, for Defendants.
This matter is before the Court on Defendants' Motion to Dismiss [Doc. No. 6] and Motion for Rule 11 Sanctions/Declaring Plaintiff a Vexatious Litigant [Doc. No 32], and Plaintiff's Motion for Sanctions and Demand for Criminal Prosecution [Doc. No. 41]. Based on a review of the files, submissions, and proceedings herein, and for the reasons below, the Court grants Defendants' Motion to Dismiss, grants in part and denies in part Defendants' Motion for Rule 11 Sanctions/Declaring Plaintiff a Vexatious Litigant, and denies Plaintiff's Motion for Sanctions and Demand for Criminal Prosecution.
Plaintiff Aditya Sharma (“Sharma”), a Minnesota resident, is the former president, CEO, and chairman of the board of Defendant Crosscode, Inc. (“Crosscode”), an information technology company. (Compl. [Doc. No. 1 [¶ 28.) Crosscode and its successor, Defendant CodeLogic, Inc. (“CodeLogic”), are Delaware corporations with their principal places of business in California. (Id. ¶ 29.) The individuals whom Sharma names as defendants (the “Individual Defendants”) are current or former Crosscode or CodeLogic executives or board members. (Id. ¶¶ 28-36.) As to the Individual Defendants, Greg Wunderle is a resident of Ohio; Robert Levy is a resident of Illinois; and Rahul Gandhi, Robert Clifford, Keith Archer, Emily Wang Fairbairn, and Brian Cullinan are residents of California. (Id.)
Sharma broadly accuses Defendants of engaging in “rampant corporate fraud” and “unleashing a campaign of violence and harassment in an effort to intimidate anyone associated with [him].” (Id. ¶ 1.)
He contends that while working at Crosscode, he developed certain information technology mapping software that resulted in a software program called “Panoptics.” (Id. ¶ 2.) He describes Panoptics as “essentially the nucleus of Crosscode's business.” (Id.) In order to increase the potential commercial success of Panoptics, in February 2019, Sharma engaged in discussions with non-party Liquid Ventures Partners (“LVP”), an investment bank, about a private-placement securities offering to raise capital for Crosscode. (Id.) The private placement closed in May 2019. (Id.) Sharma alleges, however, that unbeknownst to him, LVP was “masquerading as a legitimate investment company, ” and was part of a criminal organization engaged in corporate takeovers, shareholder divestment, and embezzlement. (Id. ¶ 3.)
As part of LVP's “strategy, ” Sharma alleges that in November 2019, Crosscode wrongfully terminated his employment as president and removed him from its board of directors. (Id. ¶¶ 4-5.) Sharma further contends that LPV then “reconstituted” Crosscode's board of directors with its own associates. (Id. ¶ 6.)
Sharma also alleges that he and Defendants previously were parties to litigation in this District and in the Northern District of California concerning whether Sharma had licensed Panoptics to Crosscode through an IP licensing agreement, whether he possessed the authority to prevent Crosscode from using the intellectual property, and whether Defendants had harassed and pressured Crosscode's lead software developer and Indian national, Ajay Singh, in an effort to invalidate the purported IP licensing agreement. (Id. ¶¶ 8-12, 48-51, 61-70.)
Further, Sharma contends that in December 2019, Defendants' attorneys guided Defendants in “stag[ing] [Crosscode's] fraudulent bankruptcy” proceeding in the Northern District of California. (Id. ¶¶ 12-13.)
As part of Defendants' alleged scheme of fraud and harassment, Plaintiff asserts that they have continued to use his residential mailing address as the official business address for Crosscode or CodeLogic, causing him to suffer harassment and “possibly face additional liens.” (Id. ¶ 19.) For instance, he contends that in March 2020, the IRS placed a lien on his residence because Crosscode or CodeLogic had failed to pay federal taxes, and unlawfully associated their business with Sharma's residential address. (Id. ¶¶ 18-19.) Sharma also alleges that despite his demands that Defendants cease using his residential address as their business address, he has received no confirmation that the issue has been remedied, nor has the IRS removed the lien on his property. (Id. ¶¶ 78-79.)
Sharma filed this lawsuit in August 2021, seeking the following relief: (1) a permanent restraining order preventing Defendants from using his residence for any business purpose; (2) injunctive relief that “awards him . . . no less than [$3.6 million] for a minimum of 36 counts of Mail Fraud”; (3) a declaratory judgment “convicting” Defendants for mail fraud; and (4) a declaratory judgment directing the U.S. Attorney's Office to prosecute non-party opposing counsel in other legal actions involving Sharma for “manipulating the U.S. legal system for illegal gains, ” and “indulging in fraudulent practices.” (Id. ¶¶ 76-97.)
In addition to this lawsuit, Sharma has been involved in related litigation. In January 2020, Crosscode filed suit against Sharma in the Northern District of California, seeking a judgment declaring the purported IP licensing agreement invalid. (See McCalmont Decl. [Doc. No. 9], Ex. C (Crosscode Inc. v. Sharma, No. 3:20-cv-00104-VC (N.D. Cal. Mar. 3, 2020 Order) at 1.) The court granted Crosscode's motion for a preliminary injunction and found that Sharma had likely “fabricated” the licensing agreement and had “intentionally destroyed relevant evidence.” (Id. at 7.) It further found Sharma's allegation of an attack on a Crosscode employee in India, Ajay Singh, to be “fanciful, ” and contradicted by an affidavit from Mr. Singh. (Id.) The court concluded that Sharma's “representations seem to be false and designed to manipulate the legal process.” (Id.)
After Crosscode filed suit in the Northern District of California, and while its motion for a preliminary injunction was pending, Sharma and his wife, Dr. Anshu Sharma, filed a lawsuit in this District, also related to the purported IP licensing agreement. (McCalmont Decl., Ex. A (Sharma v. Crosscode, No. 20-cv-436 (PJS/TNL), (D. Minn. Compl.).) Judge Patrick J. Schiltz stayed the matter pending resolution of Crosscode's preliminary injunction motion in the Northern District of California. (Id., Ex. B (Sharma v. Crosscode, No. 20-cv-436 (PJS/TNL), (D. Minn. Feb. 19, 2020 Order) at 10-11.) In addition, Judge Schiltz denied the Sharmas' motion for a temporary restraining order, as he was unable to assess the likelihood of success of their claims because he found that they failed to plead a cognizable claim.[1] (Id. at 12-13.)
Separately, in April 2020, Sharma's wife filed a civil lawsuit against Crosscode in Minnesota state court, alleging claims for breach of contract and unjust enrichment, which Crosscode removed to federal court.[2] Sharma v. Crosscode, Inc., 20-cv-1042 (DSD/BRT).
Shortly after the filing of the California and Minnesota lawsuits, Crosscode filed for Chapter 11 bankruptcy in the Northern District of California (the “Bankruptcy Court”), in May 2020. The Sharmas filed several proofs of claim against Crosscode, which the company disputed. (McCalmont Decl. Ex. D (Mot. to Approve) at 16.) Ultimately, the Sharmas and Crosscode entered into a settlement agreement (the “Settlement Agreement”). (McCalmont Decl., Ex. D (Mot. to Approve); id., Ex. E (Order Approving Settlement).) Pursuant to the Settlement Agreement, and as relevant to Mr. Sharma's claims here, he relinquished his preferred stock, and also released all claims against Crosscode (including claims against its officers, directors, agents, attorneys, and successors) related to his employment, investments, and termination, and any claim that was or could have been asserted in the California, Minnesota, and bankruptcy proceedings. (McCalmont Decl., Ex. D (Mot. to Approve) at 16-17.) In addition, Sharma agreed to release Crosscode (including its officers, directors, agents, attorneys, and successors) and forever discharge it from any actions or liabilities arising on or before the “Bankruptcy Approval Motion Final Order Date.” (Id.) The Bankruptcy Court approved the settlement in August 2020, and the settlement became effective on September 12, 2020. (McCalmont Decl., Ex. E (Order Approving Settlement) at 1); id., Ex. D (Mot. to Approve) at 23, ¶ 9(a).)
As Crosscode's bankruptcy proceedings proceeded toward resolution, in November 2020, the Bankruptcy Court approved and confirmed Crosscode's Third Amended Chapter 11 Plan of Reorganization (“the Plan”). .) As of the Plan's effective date, December 10, 2020, the Bankruptcy Court released Crosscode and “Reorganized Crosscode” (known as CodeLogic) with respect to claims related to Crosscode's bankruptcy or its liabilities and “causes of action of any nature whatsoever, ” and enjoined anyone from pursuing such claims against Crosscode as of December 10, 2020. (McCalmont Decl., Ex. G at 19...
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