Soley v. Wasserman

• Decision Date: 21 June 2013
• Docket Number: 08 Civ. 9262 (KMW) (FM)
• Parties: JUDY W. SOLEY, Plaintiff, v. PETER J. WASSERMAN, Defendant.
• Court: U.S. District Court — Southern District of New York

JUDY W. SOLEY, Plaintiff, v. PETER J. WASSERMAN, Defendant.

08 Civ. 9262 (KMW) (FM)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

June 21, 2013

OPINION & ORDER

KIMBA M. WOOD, U.S.D.J.:

Courts rely on forthright and accurate representations by counsel in making their decisions. Part and parcel of such representations are the accurate attribution of legal research and argument. For those reasons, the Court was disappointed to discover that nearly two of the nine pages of legal argument in Plaintiff's Memorandum of Law in Opposition to Defendant's Motion for in Limine Relief ("Pl.'s Mem.") are copied from a judicial opinion—nearly verbatim—without any attribution. [Dkt. No. 86]. Plaintiff's Memorandum argues, in relevant part:

When a party relies exclusively on one forum's law throughout the course of an action only to argue later that a different forum's law should be applied, courts engage in an estoppel analysis. See, e.g., Wiener v. Unumprovident Corp., No. 00 Civ. 9315 (NRB), 2002 U.S. Dist. LEXIS 17828, 2002 WL 31108182, at *2 n.2 (S.D.N.Y. Sept. 20, 2002); Nat'l Utility Serv., Inc. v. Chesapeake Corp., 45 F. Supp. 2d 438, 444-45 (D.N.J. 1999); Pereira v. Aetna Cas. & Sur. Co. (In re Payroll Express), 921 F. Supp. 1121, 1123-24 (S.D.N.Y. 1996). In National Utility, for example, the plaintiff relied on New Jersey law throughout the litigation, including when it moved for summary judgment. After defendants opposed the motion and agreed that New Jersey law applied, the plaintiff contended for the first time in its reply papers that Virginia law governed. 45 F. Supp. 2d at 444. The court applied the doctrine of judicial estoppel, a judge-made doctrine that seeks to prevent a litigant from asserting a position inconsistent with one that she has previously asserted in the same or in a previous proceeding. It is not intended to eliminate all inconsistencies, however slight or inadvertent; rather, it is designed to prevent litigants from playing fast and loose with the courts. Id.(quoting In re Chambers Dev. Co., 148 F.3d 214, 229 (3d Cir. 1998) (quoting Ryan Operations, G.P. v. Santiam-Midwest Lumber Co., 81 F.3d 355, 358 (3d Cir. 1996))).

The courts have applied two different tests for determining estoppel in this choice of law context. See Gen. Signal Corp. v. MCI Telecomm. Corp., 66 F.3d 1500, 1505 (9th Cir. 1995) (discussing majority and minority views). In Payroll Express, the court applied what the Ninth Circuit has termed the "majority view": a party is judicially estopped where "1) it argued an inconsistent position in a prior proceeding; and 2) this position was adopted by the court in some manner." 921 F. Supp. at 1124 (citing Bates v. Long Island R.R. Co., 997 F.2d 1028, 1037-38 (2d Cir.), cert. denied, 510 U.S. 992 (1993)); accord Stichting Ter Behartiging Van De Belangen v. Schreiber, 407 F.3d 34, 45 (2d Cir. 2005); see Gen. Signal, 66 F.3d at 1505 (majority view looks at whether court has adopted party's earlier inconsistent position).

This "majority view" estoppel analysis has been adopted by the Second Circuit. See, e.g., Bates, 997 F.2d at 1037-38. Under this view, defendant is estopped from arguing that Delaware law governs.

(Pl.'s Mem. 11-13). Plaintiff's brief then concludes with two sentences of original argument.

The lion's share of Plaintiff's analysis is lifted from a 2008 decision by then District Judge Chin:

[W]here a party relied exclusively on one forum's law only to argue later that a different forum's law applied, the courts have engaged in an estoppel analysis. See, e.g., Wiener v. Unumprovident Corp., No. 00 Civ. 9315 (NRB), 2002 WL 31108182, at *2 n. 2 (S.D.N.Y. Sept. 20, 2002); Nat'l Utility Serv., Inc. v. Chesapeake Corp., 45 F.Supp.2d 438, 444-45 (D.N.J. 1999); Pereira v. Aetna Cas. & Sur. Co. (In re Payroll Express), 921 F. Supp. 1121, 1123-24 (S.D.N.Y. 1996). In National Utility, for example, the plaintiff relied on New Jersey law throughout the litigation, including when it moved for summary judgment. After defendants opposed the motion and agreed that New Jersey law applied, the plaintiff contended for the first time in its reply papers that Virginia law governed. 45 F.Supp.2d at 444. The court applied the doctrine of judicial estoppel,

'a judge-made doctrine that seeks to prevent a litigant from asserting a position inconsistent with one that she has previously asserted in the same or in a previous proceeding. It is not intended to eliminate all inconsistencies, however slight or inadvertent; rather, it is designed to prevent litigants from playing fast and loose with the courts.'

Id. (quoting In re Chambers Dev. Co., 148 F.3d 214, 229 (3d Cir.1998) (quoting Ryan Operations, G.P. v. Santiam-Midwest Lumber Co., 81 F.3d 355, 358 (3d Cir. 1996))).

The courts have applied two different tests for determining estoppel in this choice of law context. See Gen. Signal Corp. v. MCI Telecomm. Corp., 66 F.3d 1500, 1505 (9th Cir. 1995) (discussing majority and minority views). . . .

In Payroll Express, the court applied what the Ninth Circuit has termed the "majority view": a party is judicially estopped where "1) it argued an inconsistent position in a prior proceeding; and 2) this position was adopted by the court in some manner." 921 F.Supp. at 1124 (citing Bates v. Long Island R.R. Co., 997 F.2d 1028, 1037-38 (2d Cir.), cert. denied, 510 U.S. 992 (1993)); accord Stichting Ter Behartiging Van De Belangen v. Schreiber, 407 F.3d 34, 45 (2d Cir.2005); see Gen. Signal, 66 F.3d at 1505 (majority view looks at whether court has adopted party's earlier inconsistent position). . . .

Here, the majority view governs, as that is the view adopted by the Second Circuit. See, e.g., Bates, 997 F.2d at 1037-38. Under either view, however, Khubani is not estopped from arguing that California law governs.

Khubani v. Ionic White, Inc., No. 05 Civ. 3706, 2008 WL 878717, *1-2 (S.D.N.Y. Apr. 3, 2008) (Chin, J.). It is further worth noting that in Khubani, Judge Chin ultimately rejected a judicial estoppel argument very similar to the one pressed by Plaintiff in this case.

Despite Plaintiff's egregious conduct, Plaintiff has not misrepresented the state of the law. Accordingly, the Court does not consider this plagiarism when ruling on the merits of the arguments presented below. Plaintiff's counsel is urged to proceed with greater care in the future.

I. Background

In this case, Plaintiff Judith W. Soley ("Soley") asserts various causes of action against her brother, Defendant Peter J. Wasserman ("Wasserman"), arising out Wasserman's conduct as Soley's financial advisor over approximately the past thirty years. This Court's prior decisions inthis matter,¹ familiarity with which is assumed, substantially narrowed the factual issues remaining to be tried. The Court's most recent decision set Soley's breach of fiduciary duty claim for a jury trial, and set Soley's accounting claim for a bench trial. See Soley v. Wasserman, No. 08 Civ. 9262, 2013 WL 1655989 (S.D.N.Y. Apr. 17, 2013) (Wood, J.).

The Parties have since submitted a joint pre-trial order, [Dkt. No. 89 ("JPTO")],² and are schedule to commence trial on July 29, 2013. Wasserman has also filed a motion in limine. [Dkt. No. 83]. For the reasons that follow, Wasserman's motion is GRANTED in part and DENIED in part.

II. Legal Standards

The Federal Rules of Evidence ("FRE") favor the admission of all relevant evidence. See Fed. R. Evid. 402. Evidence is relevant if it "tend[s] to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence." Fed. R. Evid. 401. Where the probative value of relevant evidence is slight, however, FRE 403 may preclude its admission. Under FRE 403, the Court has discretion to exclude relevant evidence when "its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury."

Similarly, FRE 702, which governs the admissibility of expert testimony, "embodies a liberal standard of admissibility." Nimely v. City of New York, 414 F.3d 381, 396 (2d Cir. 2005). Expert testimony shall be excluded, however, when it is "unhelpful and thereforesuperfluous and a waste of time." In re Methyl Tertiary Butyl Ether (MTBE) Prods. Liab. Litig., 643 F. Supp. 2d 482, 493-94 (S.D.N.Y. 2009) (Scheindlin, J.).

"A district court's inherent authority to manage the course of its trials encompasses the right to rule on motions in limine." Carofino v. Forester, 450 F. Supp. 2d 257, 270 (S.D.N.Y. 2006) (Leisure, J.) (citing Luce v. United States, 469 U.S. 38, 41 n.4 (1984)). Where such a motion requests that certain evidence be precluded, the court must "make a preliminary determination on the admissibility of the evidence under Rule 104 of the Federal Rules of Evidence." Allen v. City of New York, 466 F. Supp. 2d 545, 547 (S.D.N.Y. 2006) (citation omitted). At the motion in limine stage, a district court will exclude evidence "only when the evidence is clearly inadmissible on all potential grounds." In re MTBE, 643 F. Supp. 2d at 492 (quoting United States v. Ozsusamlar, 428 F. Supp. 2d 161, 164 (S.D.N.Y. 2006) (Wood, J.)).

"[C]ourts considering a motion in limine may reserve judgment until trial, so that the motion is placed in the appropriate factual context." United States v. Chan, 184 F. Supp. 2d 337, 340 (S.D.N.Y. 2002) (Leisure, J.). Such rulings, of course, are "subject to change when the case unfolds." Luce, 469 U.S. at 41.

III. Analysis

Wasserman's motion in limine raises four distinct issues: First, Wasserman requests that the Court preclude Soley from presenting evidence relating to various claims that have already been dismissed by the Court. Second, Wasserman requests an order limiting the testimony of Soley's expert witness. Third, Wasserman requests that Soley be precluded from referring to Patriot Partners as a "Ponzi Scheme." Fourth, Wasserman argues that Delaware law should apply...