Nambe, Llc v. Lenox Corporation

REPLY BRIEF to Opposition to Motion

D.N.J.February 14, 2017

FIRM:42957612 EPSTEIN BECKER & GREEN, P.C. Document Filed Electronically David W. Garland, Esq. One Gateway Center Newark, New Jersey 07102-5003 (973) 642-1900 Attorneys for Defendant Lenox Corporation UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x NAMBE, LLC, : : : : : : : : x Civil Action No.: 3:16-cv-09150-BRM-DEA Plaintiff, - v. - LENOX CORPORATION, Defendant. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - REPLY MEMORANDUM OF LAW OF DEFENDANT LENOX CORPORATION IN SUPPORT OF ITS MOTION TO DISMISS THE COMPLAINT PURSUANT TO FEDERAL RULE OF CIVIL PROCEDURE 12(B)(6) AND IN OPPOSITION TO PLAINTIFF NAMBÉ, LLC’S CROSS-MOTION TO RETRANSFER EPSTEIN BECKER & GREEN, P.C. One Gateway Center, 13th Floor Newark, New Jersey 07102 (973) 642-1900 Attorneys for Plaintiff Lenox Corporation Attorney No.: 015861985 Of Counsel: David W. Garland On the Brief: David W. Garland Sheila A. Woolson Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 1 of 32 PageID: 323 i FIRM:42957612 TABLE OF CONTENTS Page PRELIMINARY STATEMENT .................................................................................................... 1 ARGUMENT.................................................................................................................................. 3 I. NAMBÉ’S EFFORTS TO REWRITE THE CONFIDENTIALITY AGREEMENT DO NOT SAVE THE COMPLAINT FROM DISMISSAL FOR FAILURE TO STATE A CLAIM. ................................................................................ 3 A. Nambé’s Breach of Contract Claim Fails As A Matter Of Law...................................... 3 1. Nambé’s Tortured Interpretation of the Unambiguous Language in the Confidentiality Agreement That It Drafted Renders Its Terms Meaningless. ........................................................................................................... 4 2. The Confidentiality Agreement Is Not Ambiguous................................................ 8 B. Indiana Does Not Recognize A Claim for Breach of the Duty Of Good Faith Between Competitors.............................................................................................. 9 C. Nambé’s Prima Facie Tort Claim Should Be Dismissed............................................... 11 II. NAMBÉ’S CROSS-MOTION TO RETRANSFER THE CASE IS AN IMPROPER ATTEMPT TO RELITIGATE THE MOTION THAT IT LOST IN THE DISTRICT COURT IN NEW MEXICO AND SHOULD BE DENIED................................................................................................................................ 14 A. The Cross-Motion Is Improper As It Is Not Related To The Subject Matter Of Lenox’s Motion To Dismiss The Complaint. ............................................... 14 B. The Cross-Motion Does Not Warrant A Departure From The Principles Of Comity And A Game Of “Procedural Ping Pong” With The District Of New Mexico.............................................................................................................. 15 1. Law of the Case Principles Apply. ....................................................................... 16 2. None of The Exceptions to the Law of the Case Principles Applies. ................... 21 a. Nambé did not seek review of the Transfer Order in the District Court or the Tenth Circuit............................................................................... 21 b. Nambé has not presented any new evidence in support of its motion. ............................................................................................................ 22 c. Nambé has not identified a new legal rule which is both valid and applicable to the issues of the case........................................................... 22 d. Nambé has not established that Judge Yarbrough’s decision was clearly erroneous and would work a manifest injustice........................... 22 (1) Nambé’s choice of forum.................................................................... 22 Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 2 of 32 PageID: 324 ii FIRM:42957612 (2) The Convenience of the Witnesses. .................................................... 23 (3) The Pendency of the Robedee Case in New Jersey. ........................... 24 CONCLUSION............................................................................................................................. 25 Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 3 of 32 PageID: 325 iii FIRM:42957612 TABLE OF AUTHORITIES Page(s) Cases Allison v. Union Hosp., Inc., 883 N.E.2d 113 (Ind. Ct. of App. 2008) ....................................................................................9 Arizona v. California, 460 U.S. 605, 103 S.Ct. 1382 (1983).......................................................................................17 The Beanstalk Group, Inc. v. AM General, 143 F. Supp.2d 1020 (N.D. Ind. 2001) ..............................................................................3, 4, 8 Bobian v. CSA Czech Airlines, 222 F.Supp. 2d 598 (D.N.J. 2002) ....................................................................................20, 21 Boonville Convalescent Center v. Cloverleaf Healthcare Services, 834 N.E.2d 1116 (Ind. Ct. of App. 2013) ..................................................................................4 Carreon v. Goodtimes Wood Prods., 2011 U.S. Dist. LEXIS 153922 (D.N.M. Mar. 22, 2011)........................................................11 Christianson v. Colt Industries Operating Corp., 486 U.S. 800, 108 S. Ct. 2166 (1988)......................................................................................18 Clendening v. Indiana Family & Social Servs. Admin., 715 N.E.2d 903 (Ind. Ct. App. 1999).........................................................................................6 Collins v. McKinney, 871 N.E.2d 363 (Ind. Ct. of App. 2007) ................................................................................3, 4 Community Anesthesia v. St. Mary Medical, 26 N.E.3d 70 (Ct. of App. 2015)......................................................................................4, 9, 11 In re Cragar Indus, Inc., 706 F.2d 503 (5th Cir. 1983) .............................................................................................17, 18 Davis v. Twp. of Paulsboro, 371 F. Supp. 2d 611 (D.N.J. 2005) ..........................................................................................14 Ecotone Farm, LLC v. Ward, No. 11-CV-5094, 2016 WL 6871250 (D.N.J. November 21, 2016) .......................................12 Employers Mutual Casualty Company v. Bartile Roofs, Inc., 618 F.3d 1153 (10th Cir. 2010) ...............................................................................................23 Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 4 of 32 PageID: 326 iv FIRM:42957612 Fowler v. Shadyside, 578 F.3d 203 (3d Cir. 1999).......................................................................................................4 Gonzlez v. Napolitano, 684 F. Supp.2d 555 (D.N.J. 2010) .............................................................................................4 Gorzynski v. JetBlue Airways, Corp., 10 F. Supp. 3d 408, 412 (W.D.N.Y. 2014) ..............................................................................19 HAB Carriers, Inc. v. Arrow Truck Sales, Inc., No. 07-cv-4390, 2009 U.S. Dist. LEXIS 74265 (D.N.J. Aug. 21, 2009) ................................21 Harper v. LG Electronics, 595 F.Supp.2d 486 (D.N.J. 2009) ..............................................................................................8 Hawkins v. Harris, 141 N.J. 207 (1995) .................................................................................................................13 Hayman Cash Register Co. v. Sarokin, 669 F.2d 162 (3d Cir. 1982)...................................................................................15, 16, 17, 19 Hill v. New Jersey Dep’t of Corrections, 342 N. J. Super. 273 (App. Div. 2001) ....................................................................................13 Holland v. Consolidated Rail Corp., No. 98-cv-2694, 1998 U.S. Dist. LEXIS 10992 (E.D. Pa. July 22, 1998) ..............................20 Indiana State Bd. of Med. Registration & Exam. v. Pickard, 177 N.E. 870 (Ind. Ct. App. 1931).............................................................................................6 Jones v. Auge, 344 P.3d 989 (N.M. Ct. of App. 2015) ....................................................................................12 Lenox Corp. v. Robedee, 2016 U.S. Dist. LEXIS 127110 3:15-cv-01654-MAS-DEA (D.N.J. Sept. 19, 2016) ..............................................................................................................2 Lenox Corp. v. Robedee, 2016 U.S. Dist. LEXIS 68951 3:15-cv-01654-MAS-DEA (D.N.J. May 25, 2016) ...............................................................................................................2 Michaels v. State of New Jersey, 955 F. Supp. 315 (D.N.J. 1996) ...............................................................................................10 Mosely v. Titus, 762 F. Supp.2d 1298 (D.N.M. 2010) .......................................................................................13 Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 5 of 32 PageID: 327 v FIRM:42957612 Moses v. Business Card Express, Inc., 929 F.2d 1131 (6th Cir. 1991) .................................................................................................19 Murat Temple Ass’n v. Live Nation Worldwide, Inc., 953 N.E.2d 1125 (Ind. Ct. App. 2011).......................................................................................8 N. Apparels, Inc. v. PNC Bank, Nat’l Ass’n (In re Forman Enters.), 271 B.R. 483 (Bankr. W.D. Pa. 2002) .....................................................................................18 Nambe, LLC v. Lenox Corp., No. 16-cv-241 SCY/KBM, 2016 U.S. Dist. LEXIS 169334 (D.N.M. Dec. 7, 2016) ...........................................................................................15, 23, 24, 25 Ocean City Express Co. v. Atlas Van Lines, Inc., No. 1:13-cv-01467-JBS-KMW (D.N.J. July 25, 2013) ...........................................................10 Old Nat’l Bank v. Kelly, 31 N.E.3d 522 (Ind. Ct. of App. 2015) ................................................................................9, 10 Penwag Property Co., Inc. v. Landau, 148 N.J. Super. 493 (App.Div. 1977), aff'd, 76 N.J. 595 (1978).............................................13 Practiv Corp. v. Perk-up, Inc., No. 08-05072, 2009 WL 2568105 (D.N.J. August 18, 2009)..................................................13 Premio Foods, Inc. v. Purdue Farms. Inc., No. 11-CV-4968, 2012 WL 3133791 (D.N.J. July 30, 2012)..................................................12 Richard Pa. Pulaski Constr. Co. v. Air Frame Hangers, Inc., 950 A.2d 868 (N.J. 2008).........................................................................................................11 Rickenbach v. Wells Fargo Bank. NA, 635 F. Supp.2d 389 (D.N.J. 2009) ...........................................................................................13 Roche Diagnostics v. Marsh Supermarkets, 987 N.E.2d 72 (Ct. of App. 2013)..............................................................................................7 Schultz v. Onan Corp., 737 F.2d 339 (3d Cir. 1984).....................................................................................................17 Superior Constr. v. Linnerooth, 712 P.2d 1378 (N.M. 1986) .....................................................................................................13 Townsend v. Calderone, No. 09-3303, 2010 WL 1999588 (D.N.J. May 18, 2010)..........................................................3 Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 6 of 32 PageID: 328 vi FIRM:42957612 Travelodge Hotels, Inc. v. BO-ED Inc., No. 04-cv-4310 (HAA), 2007 U.S. Dist. LEXIS 102890 (D.N.J. Mar. 19, 2007) ..................................................................................................................................14, 15 Ulferts v. Franklin Resources, Inc. (In re Alexander), 2007 U.S. Dist. LEXIS 49289 (D.N.J. July 9, 2007)....................................................... passim United States v. Wheeler, 256 F.2d 745 (3d Cir.), cert. denied, 358 U.S. 873 (1958) ......................................................16 White v. Indiana Democratic Party ex rel. Parker, 963 N.E.2d 481 (Ind. 2012) .......................................................................................................6 Statutes 28 U.S.C. § 1404(a) .......................................................................................................................15 Other Authorities Civ. R. 7.1(h) ...........................................................................................................................14, 15 Fed. R. Civ. P. 12(b)(6)..............................................................................................................3, 15 Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 7 of 32 PageID: 329 1 FIRM:42957612 PRELIMINARY STATEMENT Nambé’s opposition to Lenox’s motion to dismiss the Complaint does not deny that Nambé filed the New Mexico Lawsuit as a transparent strategic gambit because it expected to be added as a defendant in the New Jersey Lawsuit (Lenox Corp. v. Robedee, et al., Civil Action No. 3:15-cv-01654-MAS-DEA). Rather, Nambé makes the hollow assertion that the New Mexico Lawsuit is “a serious matter” – and then misrepresents to the Court that Lenox allegedly breached the Confidentiality Agreement “nearly two (2) years after its execution.” Nambé and Lenox entered into the Confidentiality Agreement on February 20, 2014; Lenox filed the New Jersey Lawsuit one (1) year later, on March 5, 2015. In fact, Lenox filed the New Jersey Lawsuit a short time after it began unraveling Robedee’s and Scala’s duplicity, and on the heels of Scala’s violation of his non-solicitation agreement with Nambé’s hiring of one of Lenox’s key sales account executives (confirmed in discovery, which led to the filing of the Amended Complaint in the New Jersey Lawsuit in March 2016). Further underscoring the fact that its filing of the New Mexico Lawsuit was nothing but a litigation tactic, Nambé offers no explanation for its waiting a year to file the New Mexico Lawsuit after Lenox’s alleged breach of the Confidentiality Agreement and filing it on the eve of the deadline for Lenox to file a motion for leave to amend the Complaint and to add new parties in the New Jersey Lawsuit. Nambé’s silence speaks volumes. And Nambé’s completely baseless and improper cross-motion to “re-transfer” the case back to the District of New Mexico Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 8 of 32 PageID: 330 2 FIRM:42957612 after Lenox filed its motion to dismiss only reinforces the conclusion that the New Mexico Lawsuit is anything but a “serious matter.”1 As for its breach of contract claim, Nambé admits that the Confidentiality Agreement used the present tense with respect to the parties’ obligations regarding the fact of their discussions about a possible transaction, but argues that the Court should nevertheless construe the Agreement to mean the past tense in contravention of Indiana law. Nambé would have the Court rewrite the contract that Nambé wrote, changing the language in issue from “the fact that NAMBÉ is considering the Possible Transaction is Confidential Information” to “the fact that NAMBÉ was considering the Possible Transaction is Confidential Information.” That is not the Court’s function; on this motion, the Court must decide whether Nambé has pleaded a plausible breach of contract claim with regard to the agreement that the parties executed, not one that they did not. Since the Complaint alleges that Lenox breached the Agreement by filing the New Jersey Lawsuit and thereby disclosing that “Nambé’s owners were considering a possible transaction to sell Nambé,” the Complaint does not allege a plausible claim. Nambé also admits that Indiana law does not impose an implied covenant of good faith and fair dealing upon Lenox, but nevertheless asks the Court to impose one. With regard to the prima facie tort claim, it fails for a number of reasons, including that it is inseparable from the breach of contract claim or is otherwise barred. In short, the Complaint fails to satisfy the 1 Relitigating issues is a common tactic by Nambé and Robedee, its Chief Executive Officer. In the New Jersey Lawsuit, Robedee sought reconsideration of the Order allowing Lenox to file its amended complaint and filed objections to the Order entering a protocol with respect to the forensic examination of Robedee’s hard drive. See Lenox Corp. v. Robedee, 2016 U.S. Dist. LEXIS 127110 (D.N.J. Sept. 19, 2016) and Lenox Corp. v. Robedee, 2016 U.S. Dist. LEXIS 68951 (D.N.J. May 25, 2016). Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 9 of 32 PageID: 331 3 FIRM:42957612 plausibility requirements of Iqbal and Twombly, and therefore, the Court should put an end to this sideshow litigation. ARGUMENT I. NAMBÉ’S EFFORTS TO REWRITE THE CONFIDENTIALITY AGREEMENT DO NOT SAVE THE COMPLAINT FROM DISMISSAL FOR FAILURE TO STATE A CLAIM. The Court should dismiss the Complaint in its entirety because all three counts fail as a matter of law. Nambé’s interpretation of the Confidentiality Agreement is inconsistent with the clear terms of the Agreement and Indiana law. Its claim for breach of the duty of good faith similarly fails as a matter of law because the Confidentiality Agreement does not contain an express duty of good faith and Indiana law will not imply such a duty in a contract between two competitors. Finally, Nambé’s prima facie tort claim fails because the claim is duplicative and subsumed by its failed contract claim and barred by the litigation privilege. Even the cases that Nambé cites make clear that its Complaint should be dismissed because it fails to allow the Court to draw the reasonable inference that Lenox is liable for the misconduct that Nambé alleges. Townsend v. Calderone, No. 09-3303, 2010 WL 1999588 (D.N.J. May 18, 2010). Nambé has failed to raise its right to relief beyond mere speculation. Thus, pursuant to Fed. R. Civ. P. 12(b)(6), the Court should dismiss the Complaint. A. Nambé’s Breach of Contract Claim Fails As A Matter Of Law. The cases cited by Nambé make clear that the interpretation of a contract is ordinarily a matter of law for the Court to decide, not a question of fact. The Beanstalk Group, Inc. v. AM General, 143 F. Supp.2d 1020, 1026 (N.D. Ind. 2001); Collins v. McKinney, 871 N.E.2d 363, Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 10 of 32 PageID: 332 4 FIRM:42957612 372 (Ind. Ct. of App. 2007).2 The Court must give effect to all of the words and phrases in interpreting the language of a contract. Beanstalk Group, 143 F. Supp.2d at 1026; Community Anesthesia v. St. Mary Medical, 26 N.E.3d 70, 76 (Ind. Ct. of App. 2015). Nambé’s contractual interpretation violates the very legal principles which it cites. Rather than reading the Confidentiality Agreement as a whole, Nambé’ ignores the language of the Agreement which states “the fact that Nambé is considering the Possible Transaction is Confidential Information.” (See Nambé brief (“Br.”), pp. 12-13)(emphasis added). It ignores its use of the present tense in that clause, creating an untenable interpretation that converts its use of the present tense into the past tense. Nambé then argues that if the Court does not accept that argument, it should find the Confidentiality Agreement that Nambé drafted to be ambiguous. Both arguments fail. The Confidentiality Agreement is not ambiguous; it simply does not support Nambé’s claim for breach of contract and therefore, the Court should dismiss the claim as a matter of law. 1. Nambé’s Tortured Interpretation of the Unambiguous Language in the Confidentiality Agreement That It Drafted Renders Its Terms Meaningless. The starting point for any interpretation has to be the Confidentiality Agreement itself. See Boonville Convalescent Center v. Cloverleaf Healthcare Services, 834 N.E.2d 1116, 1121- 22 (Ind. Ct. of App. 2013) (noting the parties’ intent is determined from the four corners of the document); Collins, 871 N.E.2d at 372 (same). The sentence of the preamble to the Confidentiality Agreement states in salient part: 2 Even though the Court must accept any well-pled allegations as true and construe them in favor of Nambé, the Court need not accept Nambé’s interpretation of the Confidentiality Agreement, which is a legal conclusion. Fowler v. Shadyside, 578 F.3d 203, 211 (3d Cir. 1999); Gonzlez v. Napolitano, 684 F. Supp.2d 555, 558 (D.N.J. 2010). Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 11 of 32 PageID: 333 5 FIRM:42957612 To facilitate discussions relating to a possible transaction (“Possible Transaction”)…[Lenox] desires to review and analyze certain information relating to NAMBÉ that NAMBÉ regards as proprietary and confidential.3 (Dkt. No. 25-3, Ex. A). Paragraph 1 of the Confidentiality Agreement describes the types of information that Nambé considered to be “confidential.” It included intellectual property, customer information and financial information, i.e., the type of information shared between two companies discussing a possible transaction that one would expect to be kept confidential regardless of the outcome of those discussions: Confidential Information shall mean any and all financial, commercial or other information concerning the technology, business and affairs of NAMBÉ that may hereafter be provided to the FIRM, including (without limitation) patent, copyright, trade secret, and proprietary information, techniques, sketches, drawings, models, inventions, know-how, processes, apparatus, equipment, algorithms, software programs, software source documents, formulae, research, experimental work, development, design details and specifications and engineering information related to the current, future and proposed products and services of NAMBÉ, customer lists and supplier identities, marketing knowledge, sales figures, pricing and margin information, financial budgets, forecasts, and projections and business and strategic plans. Id.4 3 Contrary to Nambé’s argument that Lenox is not identified in the Confidentiality Agreement (Br. 12), its last page defines the “Firm” as Lenox – and, of course, Lenox is a signatory to the Agreement. Further, while Nambé contends that “[t]he phrase ‘Possible Transaction’ is clearly a broad, all-encompassing phrase that applies to all matters concerning any potential business transaction between Plaintiff and Defendant, including without limitation, discussions relating to same” (Br. pp. 12-13), “Possible Transaction” is a defined term referring to “a possible transaction,” nothing more. 4 Notably, the Confidentiality Agreement excludes from the definition of “Confidential Information” information that becomes publically available other than through Lenox. Nambé has twice attached the Confidentiality Agreement to publically filed papers – something Lenox has never done – making the entire Confidentiality Agreement and related discussions public information. Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 12 of 32 PageID: 334 6 FIRM:42957612 Paragraph 2 then states that: The Confidential Information will be used solely for the purpose of evaluating the Possible Transaction by [Lenox] and, unless and until the Possible Transaction has been consummated, [Lenox] shall exercise all reasonable precautions to safeguard the confidentiality of the Confidential Information is has received. Id. After indicating that the intellectual property, financial and customer information is to be maintained as confidential until a transaction has been consummated (and thereby would become Lenox’s property), the Agreement adds the following: Moreover, the fact that NAMBÉ is considering the Possible Transaction is Confidential Information. Id. (emphasis added). The Confidentiality Agreement itself treats Nambé’s consideration of the Possible Transaction separately and differently from Nambé’ intellectual property, financial and customer information. It only required confidentiality with respect to Nambé’s current consideration of the transaction, not its past consideration of a possible transaction. Had Nambé intended that its past consideration of the Possible Transaction to also be considered confidential, it would have used different words, such as “was considering,” “had considered” or “did consider.” White v. Indiana Democratic Party ex rel. Parker, 963 N.E.2d 481, 488-89 (Ind. 2012) (construing use of present tense in a statute to require “current and ongoing activity”); Clendening v. Indiana Family & Social Servs. Admin., 715 N.E.2d 903, 906 (Ind. Ct. App. 1999) (“[b]y substituting ‘is’ for ‘shall be,’ the legislature changed the verb tense from future to present”); Indiana State Bd. of Med. Registration & Exam. v. Pickard, 177 N.E. 870, 873 (Ind. Ct. App. 1931) (“Webster’s New International Dictionary defines the word ‘is’ as being the third person singular Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 13 of 32 PageID: 335 7 FIRM:42957612 present indicative of the verb be. The word ‘is’ in its plain, ordinary and usual sense denotes present tense.”) (emphasis added). Nambé did not use the past tense to describe the discussions related to the Possible Transaction because it did not consider the fact that it had in the past considered a transaction that did not occur to be confidential. Naturally, Nambé would not want its intellectual property, customer or financial information disclosed in the event that the parties did not “consummate” the Possible Transaction. Similarly Nambé would be concerned with others learning about on- going consideration of a transaction (which might impact the negotiations or valuation or employees). The fact that in the past the parties had discussed a Possible Transaction is in no sense confidential nor did Nambé intend to be by the terms of the agreement that it prepared. Contrary to Nambé’s argument, the above interpretation does not give “more effect” to the term “is considering” than “unless and until the Possible Transaction has been consummated.” (Br. pp. 17-18). It gives equal effect to both phrases by logically parsing the language that Nambé used in drafting the Confidentiality Agreement. In contrast, Nambé’s interpretation would render meaningless the language it chose to include regarding its consideration of the transaction: “the fact that NAMBÉ is considering the Possible Transaction is Confidential Information.” That Nambé now wishes it had drafted the Confidentiality Agreement differently is irrelevant. See Roche Diagnostics v. Marsh Supermarkets, 987 N.E.2d 72, 82 (Ct. of App. 2013) (noting that commercial parties can allocate risk as they wish and the court will not interfere just because such risks occurred). The clear and unequivocal terms of the Confidentiality Agreement did not deem confidential the fact that the parties had previously discussed the Possible Transaction, regardless of whether or not the Transaction was “consummated.” Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 14 of 32 PageID: 336 8 FIRM:42957612 It is undisputed that Nambé terminated the discussions related to the Possible Transaction before Lenox filed its Complaint. (Nambé Cplt, ¶31) The fact that Lenox’s Complaint subsequently disclosed that Nambé had considered a transaction with Lenox in the past but then decided not to proceed does not violate the Confidentiality Agreement by its terms. (Nambé Cplt., ¶¶ 32-33). Indeed, the Confidentiality Agreement’s “plain and ordinary” terms confirm that Lenox did not breach it as a matter of law. “There are no possible set of facts upon which [Nambé] can recover against [Lenox] for breach of contract,” and the breach of contract claim should be dismissed. Murat Temple Ass’n v. Live Nation Worldwide, Inc., 953 N.E.2d 1125, 1131 (Ind. Ct. App. 2011). 2. The Confidentiality Agreement Is Not Ambiguous. Perhaps because it recognizes the flaw in its principal argument, Nambé offers the alternative argument that the Confidentiality Agreement is ambiguous. Even if that were the case, and it is not, Nambé’s breach of contact claim should still be dismissed. As an initial matter, an alleged ambiguity in an agreement that “arises because of the language used in the contract and not because of extrinsic facts” is still an issue of law for the Court to decide. Beanstalk Group, 143 F. Supp.2d at 1027. In this case, the alleged ambiguity arises out the purported conflict between the phases “is considering” and “unless and until the Possible Transaction has been consummated.” The alleged ambiguity is based upon the language Nambé used, not extrinsic evidence. Therefore, the interpretation of the Confidentiality Agreement remains a question of law for the Court to decide on a motion to dismiss. Id. This result is unchanged despite Nambé’s improper inclusion of an Affidavit from H. Kent Howard. See Harper v. LG Electronics, 595 F.Supp.2d 486, 488-89 (D.N.J. 2009) (on motion to dismiss the Court considers the Complaint, attachments to the Complaint and matters Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 15 of 32 PageID: 337 9 FIRM:42957612 of public record). Obviously, the Court should disregard the Howard Affidavit on a motion to dismiss. Regardless, because the Howard Affidavit addresses only the language he chose to use in the Confidentiality Agreement and not extrinsic evidence related to it, it does not prevent the Court from interpreting the Confidentiality Agreement as a matter of law. Finally, and most importantly, under Indiana law, an ambiguous contract is construed against the drafter, here Howard on behalf of Nambé. Community Anesthesia, 26 N.E.3d at 77. Therefore, even if the Confidentiality Agreement was ambiguous, the Court should reject Howard’s self-serving, after- the-fact reinterpretation. Nambé’s attempt to create an ambiguity in the Confidentiality Agreement fails, and no ambiguity exists that would preclude the Court from granting the motion to dismiss. B. Indiana Does Not Recognize A Claim for Breach of the Duty Of Good Faith Between Competitors. Nambé admits that “Indiana does not impose a generalized duty of good faith and fair dealing in every contract.” (Br. p. 15). Nevertheless, Nambé argues that the Court should not dismiss its claim for breach of the duty of good faith because (1) the Confidentiality Agreement imposes an express obligation of good faith on Lenox or (2) because the Agreement is “ambiguous,” and therefore the Court should imply that a duty of good faith exists. Both contradictory arguments fail. The Confidentiality Agreement does not contain any express or implicit duty of good faith, and the absence of that duty does not make the Confidentiality Agreement ambiguous. Pursuant to Indiana law, the court imposes an implied covenant of good faith and fair dealing in limited circumstances, not present here, involving employment and insurance contracts. Allison v. Union Hosp., Inc., 883 N.E.2d 113, 123 (Ind. Ct. of App. 2008). For example, in Old Nat’l Bank v. Kelly, 31 N.E.3d 522, 532 (Ind. Ct. of App. 2015), a case upon Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 16 of 32 PageID: 338 10 FIRM:42957612 which Nambé relies, the court first equated the relationship between a bank and customer to the relationship of an insurance company and customer before finding the contract ambiguous as to the existence of the duty of good faith. Old Nat’l, 31 N.E.2d at 531-32 (stating “[w]e discern no crucial difference between insurance companies and banks….”) In contrast, Ocean City v. Atlas Vans, No. 1:13-cv-01467-JBS-KMW (D.N.J. July 25, 2013), at 12, (D.N.J. July 25, 2013), a case which is directly on point, demonstrates that no duty of good faith exists here. The Ocean City court dismissed a claim of breach for duty of good faith between two commercial parties whose underlying contract was governed by Indiana law because “Indiana common law does not allow good faith and fair dealing claims.” Ocean City Express, No, 1:13-cv-01467-JBS-KMW, at 12. While it is correct that the Court dismissed the claim without prejudice, Nambé glosses over the fact the claim was dismissed. The burden was on the plaintiff to show a set of facts that would support a non-futile amendment based upon fiduciary duty or ambiguity, something the court was quite skeptical would occur. Id., pp. 12-13. Here, no facts have been pled or even suggested that would support the imposition of a duty of good faith under Indiana law.5 This is true despite Nambé attempts to argue that the Confidentiality Agreement “clearly imposes a duty of good faith” on Lenox. Nambé fails to identify a single phrase or clause that even mentions the words “good faith”; instead, it simply repeats various provisions of the Confidentiality Agreement and claims that those provisions impose a duty of good faith on Lenox. Under Nambé’s interpretation, virtually any contractual obligation would create a duty 5 Notably, Nambé does not offer any proposed amendment or set of facts that would salvage this claim, making dismissal with prejudice appropriate. Michaels v. State of New Jersey, 955 F. Supp. 315, n.11 (D.N.J. 1996) (noting that dismissal with prejudice is appropriate where plaintiff has no claim). Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 17 of 32 PageID: 339 11 FIRM:42957612 of good faith, which is completely contrary to Indiana law. Nambé and Lenox are in a competitive relationship, not a fiduciary relationship, and the words “good faith” never appear in the Confidentiality Agreement. The Confidentiality Agreement does not impose a duty of good faith on Lenox. Nambé immediately undercuts its claim of a clear duty of good faith by arguing that at the very least the Court should find that the Confidentiality Agreement is ambiguous as to whether it imposes a duty of good faith on Lenox. The Confidentiality Agreement is not ambiguous: it simply does not include a duty of good faith. That absence does not make the Agreement unclear. This is underscored by Nambé’s choice of Indiana law to govern the Confidentiality Agreement (Howard works and resides in Indiana). Nambé certainly knew or should have known that Indiana law does not imply a duty of good faith in a contract between competitors, and its failure to include any such express duty can only be construed as intentional. Community Anesthesia, 26 N.E.3d at 77 (construing alleged ambiguity in a document against the drafter). C. Nambé’s Prima Facie Tort Claim Should Be Dismissed. Nambé argues that it should be permitted to assert a prima facie tort claim that is already subsumed by its contract claims and prohibited by the litigation privilege. Under either New Jersey or New Mexico law, however, the claim is barred. Although a party is permitted to plead in the alternative, a party is not permitted to allege prima facie tort where other relief is available. For example, in Richard Pa. Pulaski Constr. Co. v. Air Frame Hangers, Inc., 950 A.2d 868, 877 (N.J. 2008), the Court dismissed the prima facie tort claim, finding that the plaintiff’s claim was actually for breach of contract. See also Carreon v. Goodtimes Wood Prods., 2011 U.S. Dist. LEXIS 153922 (D.N.M. Mar. 22, 2011) (holding Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 18 of 32 PageID: 340 12 FIRM:42957612 that prima facie tort claims are appropriate only where the factual allegations do not give rise to another tort or a contractual claim); Jones v. Auge, 344 P.3d 989, 1001-02 (N.M. Ct. of App. 2015) (same). Nor can a party defeat a motion to dismiss claims by alleging a claim for prima facie tort as a substitute for claims that are otherwise not sustainable. Prima facie tort is “not a catch-all alternative for every cause of action that cannot stand on its own legs. Premio Foods, Inc. v. Purdue Farms. Inc., No. 11-CV-4968, 2012 WL 3133791 (D.N.J. July 30, 2012) (holding that prima facie tort should not be involved “where the essential elements of an established and relevant cause of action are missing”) (quotations omitted). For example, Nambé relies on Ecotone Farm, LLC v. Ward, No. 11-CV-5094, 2016 WL 6871250 (D.N.J. November 21, 2016), but there the Court allowed a claim for prima facie tort to remain in the alternative only because other viable claims were proceeding after the motion to dismiss. That is not the case here. Nambé’ is seeking to do exactly what the law prohibits. It has brought a claim for breach of contract based upon the filing of the Complaint, and its prima facie tort claim is based upon those same allegations. The prima facie tort claim is duplicative of the contract claim and should be dismissed. This is particularly true given that Nambé breach of contract claims fails as a matter of law for the reasons set forth above. There is no reason that Lenox should have to address a prima facie tort claim that is already subsumed by Nambé’s failed breach of contract claim. Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 19 of 32 PageID: 341 13 FIRM:42957612 Regardless, Lenox’s filing of its complaint is not a prima facie tort.6 The litigation privilege “insures that statements by attorneys, parties and their representatives made in the course of judicial … proceedings are absolutely privileged and immune from liability.” Rickenbach v. Wells Fargo Bank. NA, 635 F. Supp.2d 389, 401 (D.N.J. 2009) (internal quotations omitted). The privilege covers statements made outside of the courtroom, and it protects against a wide variety of tort claims. Id. at 402. Even the cases cited by Nambé confirm that the litigation privilege applies to any “all statements or communications in connection with the judicial proceeding”; if “the communication has a nexus with the litigation, it is privileged.” Hill v. New Jersey Dep’t of Corrections, 342 N. J. Super. 273, 295 (App. Div. 2001). See Practiv Corp. v. Perk-up, Inc., No. 08-05072, 2009 WL 2568105 (D.N.J. August 18, 2009) (finding no basis to pierce the litigation privilege based solely upon an allegation of bad faith in filing a claim). New Mexico has similarly recognized that no precedent exists to support a cause of action based upon the filing of a lawsuit. Mosely v. Titus, 762 F. Supp.2d 1298, 1322-23 (D.N.M. 2010); Superior Constr. v. Linnerooth, 712 P.2d 1378, 1381-82 (N.M. 1986) (noting there are very few exceptions to the litigation privilege). To the extent that the prima facie tort claim is based upon Lenox’s having served (rather than merely filed) the Complaint, the claim is also barred by the litigation privilege. Nambé admits that personal service of a complaint is proper, and cites no rule that prohibits the alleged (and denied) conduct about which it complains. See Hawkins v. Harris, 141 N.J. 207, 220 (1995) (noting the privilege extends to representatives of the parties in litigation). It merely 6 Nambe’s argument about malicious use of process is irrelevant as it has not asserted such a claim. Nor could it. See Penwag Property Co., Inc. v. Landau, 148 N.J. Super. 493, 500 (App.Div. 1977), aff'd, 76 N.J. 595 (1978) (noting one of the elements is the successful resolution of litigation in the plaintiff’s favor). Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 20 of 32 PageID: 342 14 FIRM:42957612 claims Lenox should have served its Complaint confidentially. (Br., p. 22). But “confidential” service of the Complaint is not required by either the Court rules or the Confidentiality Agreement. Regardless, even the Confidentiality Agreement did require“ confidential” service (and it did not), the failure to so serve would be a breach of contract, not a prima facie tort. Nambé’s prima facie tort claim fails to state a claim under any of Nambé’s theories, and it should be dismissed. II. NAMBÉ’S CROSS-MOTION TO RETRANSFER THE CASE IS AN IMPROPER ATTEMPT TO RELITIGATE THE MOTION THAT IT LOST IN THE DISTRICT COURT IN NEW MEXICO AND SHOULD BE DENIED. Nambé’s cross-motion should be denied for two reasons. First, it is procedurally improper, as it is not “related to the subject matter of the original motion” and therefore should not be permitted under Local Rule 7.1. Second, it also fails on its merits, as Nambé has failed to satisfy any of the exceptions required for this Court to depart from the law of the case and principles of comity. A. The Cross-Motion Is Improper As It Is Not Related To The Subject Matter Of Lenox’s Motion To Dismiss The Complaint. Local Rule 7.1(h) provides that a cross-motion must be “related to the subject matter of the original motion.” L. Civ. R. 7.1(h). Whether “a cross-motion is sufficiently related to the subject matter of an original motion is an issue infrequently addressed by this Court, but where no such relation is clear, the court may refuse to permit the cross-motion.” Travelodge Hotels, Inc. v. BO-ED Inc., No. 04-cv-4310 (HAA), 2007 U.S. Dist. LEXIS 102890, at *10 (D.N.J. Mar. 19, 2007). But “to the extent that the Cross-Motion suffers from any technical deficiencies or strays from the Local Rules in a minimal way,” the Court has the discretion to allow the cross- motion to proceed. Davis v. Twp. of Paulsboro, 371 F. Supp. 2d 611, 617 (D.N.J. 2005) (citation omitted). Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 21 of 32 PageID: 343 15 FIRM:42957612 Here, the cross-motion concerns solely the transfer Order entered by Judge Yarbrough in the District of New Mexico on December 7, 2016, under 28 U.S.C. § 1404(a). Nambe, LLC v. Lenox Corp., No. 16-cv-241 SCY/KBM, 2016 U.S. Dist. LEXIS 169334 (D.N.M. Dec. 7, 2016). The cross-motion does not address at all the subject of Lenox’s motion to dismiss, brought pursuant to Federal Rule of Civil Procedure 12(b)(6). The relief sought by each motion is entirely different, as is the law applicable to each. Although Lenox initially moved in the New Mexico to dismiss the Complaint, or in the alternative, to transfer the case to the District of New Jersey, the New Mexico court granted the transfer motion and did not consider the arguments advanced in support of Lenox’s motion to dismiss. Id. at *1. As a result, Lenox filed a new motion to dismiss when the case was transferred to this Court – and Nambé’s cross-motion is not related to it. Thus, for this reason alone, the Court should deny the cross-motion. See Travelodge Hotels, Inc., 2007 U.S. Dist. LEXIS 102890, at *10 (denying defendant’s cross- motion to compel deposition testimony as procedurally improper under Local Rule 7.1(h) where it was not sufficiently related to plaintiff’s original motion for summary judgment). B. The Cross-Motion Does Not Warrant A Departure From The Principles Of Comity And A Game Of “Procedural Ping Pong” With The District Of New Mexico. Nambé’s cross-motion also fails on the merits. In support of its argument to send this case back to the District of New Mexico, Nambé principally relies on the Third Circuit’s decision in Hayman Cash Register Co. v. Sarokin, 669 F.2d 162 (3d Cir. 1982). Nambé’s brief omits significant elements of the law that applies here, and in the process, misrepresents the holding of Hayman – as well as other cases cited in its brief and the law governing its cross- motion. Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 22 of 32 PageID: 344 16 FIRM:42957612 1. Law of the Case Principles Apply. In Hayman, the Third Circuit recognized that the “rule of judicial comity,” the purpose of which is “to preserve the orderly functioning of the judicial process,” applies “to the propriety of transfer orders between two courts.” Id. at 168 (citation omitted). Thus, “[i]f the party opposing the transfer believes the decision is erroneous, it can either seek reconsideration in the transferor court, or else petition for a writ of mandamus in the court of appeals of the circuit in which the transferor court is located.” Id. at 168-69. In support of this statement, the court cited United States v. Wheeler, 256 F.2d 745, 747 (3d Cir.), cert. denied, 358 U.S. 873 (1958), for the proposition that “if the first judge is available the matter should again be presented to him.” Id. at 168 n.7. The Third Circuit further explained that “[a]dherence to law of the case principles is even more important … where the transferor judge and the transferee judge are not members of the same court.” Id. at 169. In that context, “the principles of comity among courts of the same level of the federal system provide a further reason why the transferee court should not independently re-examine an issue already decided by a court of equal authority.” Id. The court then referred to “a thoughtful discussion [by the Chief Judge of the District of Delaware] of why law of the case principles should apply in the context of a motion to transfer”: It is not only the principle of comity and the fact that … [the transferor judge’s] opinion may be likened, at this stage, to the ‘law of this case’ which compels me to this conclusion, but, what seems of most importance to me are considerations for the orderly functioning of the judicial process. If I should grant plaintiffs’ motion and say, in effect, to [the transferor judge], ‘You were wrong in transferring this case to Delaware,’ I do not think he, in turn, would be any more bound to take and try the case on the merits, thereby respecting my views, than I had shown myself to be ignoring his considered judgment. If both [the transferor judge] and I were obdurate in our positions, this case could conceivably Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 23 of 32 PageID: 345 17 FIRM:42957612 shuttle back and forth interminably between California and Delaware. Such an eventuality should be avoided. Id. at n.8 (citing Gulf Research & D. Co. v. Schlumberger Well. Sur. Corp., 98 F. Supp. 198, 201 (D. Del.), mandamus denied sub nom. Gulf Research & Development Co. v. Leahy, 193 F.2d 302 (3d Cir. 1951), aff’d by an equally divided Court, 244 U.S. 861 (1952) (Emphasis added). The Third Circuit, however, in Hayman identified three narrow exceptions to the law of the case doctrine that would permit reconsideration of an issue previously decided in the same case by the transferor judge: (1) If the transferor judge was unavailable to hear a motion for reconsideration, the successor judge may entertain “a timely motion to reconsider the conclusions of an unavailable predecessor”; (2) If new evidence is available to the second judge when hearing the issue; and (3) If there is a new legal rule which is both valid and applicable to the issues of the case. Id. at 169-70. Subsequently, in Schultz v. Onan Corp., 737 F.2d 339, 345 (3d Cir. 1984), the Third Circuit accepted a fourth exception: if “the decision was clearly erroneous and would work a manifest injustice.”7 Nambé cites the Fifth Circuit’s decision In re Cragar Indus, Inc., 706 F.2d 503 (5th Cir. 1983), to support this fourth exception, i.e., where the transfer order is “manifestly erroneous.” Nambé’s brief, however, misstates its holding by omitting the admonition from the Fifth Circuit instructing the transferee court not to independently review the decision of the transferor court: 7 Although Nambe relies primarily on Hayman, the Third Circuit did not accept this fourth exception in that case. Rather, the Third Circuit stated that it “has not yet recognized such an exception to the law of the case doctrine.” Hayman, 669 F.2d at170, n. 10 (citing Todd & Co., Inc. v. S.E.C., 637 F.2d 154, 157 n. 4 (3d Cir. 1980); the panel in Schultz recognized that the Court in Hayman had “declined to address a fourth exception applicable if ‘the decision was clearly erroneous and would work a manifest injustice,’” but that the Supreme Court in a subsequent case, Arizona v. California, 460 U.S. 605, 103 S.Ct. 1382, 1391 n. 8 (1983), had approved this exception as well. Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 24 of 32 PageID: 346 18 FIRM:42957612 Certainly, the decision of a transferor court should not be reviewed again by the transferee court. Starnes v. McGuire, 168 U.S. App. D.C. 4, 512 F.2d 918, 924 (D.C.Cir.1974) (en banc). Such an independent review would implicate those concerns which underlie the rule of repose and decisional order we term the law of the case. We have said: “If the motion to transfer is granted and the case is transferred to another district, the transferee-district should accept the ruling on the transfer as the law of the case and should not re- transfer ‘except under the most impelling and unusual circumstances or if the transfer order is ‘manifestly erroneous.’” United States v. Koenig, 290 F.2d 166, 173 n.11 (5th Cir.1961), aff’d, 396 U.S. 121, 90 S. Ct. 396, 24 L. Ed. 2d 305 (1962). Failure to abide the original transfer order contains the additional potential mischief of tossing cases back and forth to the detriment of an adjudication of the underlying merits of the case and respect due sister courts. In re Cragar Indus, Inc., 70 F.2d at 505 (Emphasis added). Subsequently, in Christianson v. Colt Industries Operating Corp., 486 U.S. 800, 817-19, 108 S. Ct. 2166 (1988), the Supreme Court held that the transferor court’s decision should not be disturbed as long as it is “plausible” – and reversal of that decision will be the “exceptional” case: Situations might arise, of course, in which the transferee court considers the transfer “clearly erroneous.” Arizona v. California, 460 U.S. at 618, n. 8. But as “the doctrine of the law of the case is . . . a heavy deterrent to vacillation on arguable issues,” 1B Moore’s P0.404[1], at 124, such reversals should necessarily be exceptional; courts will rarely transfer cases over which they have clear jurisdiction, and close questions, by definition, never have clearly correct answers. Under law-of-the-case principles, if the transferee court can find the transfer decision plausible, its jurisdictional inquiry is at an end. See Fogel v. Chestnutt, 668 F.2d 100, 109 (CA2 1981) (“The law of the case will be disregarded only when the court has ‘a clear conviction of error’”) (citation omitted), cert. denied, 459 U.S. 828 [1118] (1982). Id. at 819 (Emphasis added). As stated in N. Apparels, Inc. v. PNC Bank, Nat’l Ass’n (In re Forman Enters.), 271 B.R. 483, 487 (Bankr. W.D. Pa. 2002), it is not enough to disregard the law of the case doctrine because “reasonable minds well might disagree with the earlier decision”; Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 25 of 32 PageID: 347 19 FIRM:42957612 the earlier decision must have been “clearly erroneous” or result in “a manifest injustice” for it to be revisited.8 Judge Martini applied the teachings of Hayman and its progeny in Ulferts v. Franklin Resources, Inc. (In re Alexander), 2007 U.S. Dist. LEXIS 49289 (D.N.J. July 9, 2007) – a case that Nambé’s brief does not mention. In Ulferts, the lawsuit was originally brought in the Northern District of California. Sitting in that court, Judge Illston granted the motion to transfer the case to the District of New Jersey, holding that “the interests of justice weigh strongly in favor of transfer.” Id. at *3 (quoting Alexander v. Franklin Res., Inc., No. 06-cv-7121, 2007 U.S. Dist. LEXIS 19727, at *7 (N.D. Ca. Feb. 14, 2007)). In reaching that decision, Judge Illston found a similarity between the case pending in California and another case already in New Jersey, afforded little weight to the plaintiffs’ choice of forum, and discounted the plaintiffs’ argument that the Northern District of California was a more convenient forum for the defendants’ employees to testify. Id. at *3-4 (citing Alexander, 2007 U.S. Dist. LEXIS 19727, at *8-12). Subsequently, the plaintiffs moved to “re-transfer” the case to the Northern District of California. In denying the motion to “re-transfer,” Judge Martini quoted from Hayman: Adherence to the law of the case principles is even more important in this context where the transferor judge and the transferee judge are not members of the same court. Here the principles of comity among courts of the same level of the federal system provide a further reason why the transferee court should not independently re-examine an issue already decided by a court of equal authority. 8 Other circuits have likewise held that motions to re-transfer “are highly disfavored under the doctrine of law of the case.” See, e.g., Gorzynski v. JetBlue Airways, Corp., 10 F. Supp. 3d 408, 412 (W.D.N.Y. 2014); Moses v. Business Card Express, Inc., 929 F.2d 1131, 1137 (6th Cir. 1991) (quoting Christianson, 486 U.S. 800 at 816). Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 26 of 32 PageID: 348 20 FIRM:42957612 Id. at *8-9 (quoting Hayman, 669 F.2d at 169). Judge Martini then observed that Judge Illston’s transfer order constituted the law of the case and that he was bound by her order unless one of the exceptions to the law of the case doctrine applied. Id. at *10-11. He found that none applied, as the plaintiffs had not been “constrained in challenging Judge Illston’s order” by filing a motion for reconsideration or a petition for a writ of mandamus with the Ninth Circuit Court of Appeals, but had not done so. Id. at *11-12. Additionally, there was no new evidence in the case or new law applicable to the matter – and Judge Illston’s order did “not even approach the showing necessary to establish that her decision is clearly erroneous and would work a manifest injustice.” Id. at *12. The cases cited by Nambé further support the principle that the decision of the transferor should only be reversed in the rarest of cases. In Holland v. Consolidated Rail Corp., No. 98-cv- 2694, 1998 U.S. Dist. LEXIS 10992 (E.D. Pa. July 22, 1998) (see Br. at p. 23), the court denied a motion that essentially amounted to a request to retransfer the case: “The law of the case doctrine applies with even greater force to transfer decisions than to decisions of substantive law.” Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 816, 100 L.Ed. 2d 811, 108 S. Ct. 2166 (1987). Motions to retransfer raise “the possibility of forcing a transferred case into perpetual litigation by playing ‘jurisdictional ping-pong.’” Moses v. Business Card Exp., Inc., 929 F.2d 1131, 1134 (6th Cir. 1991). Holland, 1998 U.S. Dist. LEXIS 10992, at *4. Because of these principles, the Holland court reiterated that the transferee court should accept the decision of the transferor court so long as it is “plausible.” Id. at *5. Likewise, in Bobian v. CSA Czech Airlines, 222 F.Supp. 2d 598 (D.N.J. 2002) (see Br. at pp. 23-24), Judge Debevoise affirmed the Magistrate Judge’s Order declining to retransfer the case to the Southern District of Texas and noting that “under the law Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 27 of 32 PageID: 349 21 FIRM:42957612 of the case principles, if the transferee court can find the transfer decision plausible, its jurisdictional inquiry is at an end.” Bobian, 222 F. Supp. 2d at 603 (citation omitted).9 2. None of The Exceptions to the Law of the Case Principles Applies. As explained above, the law of the case principles apply here, unless Nambé can establish that this is the rarest of cases where a transferee court should reverse the decision of the transferor court. This is not such a case: Judge Yarbrough’s decision was more than “plausible,” and Nambé has failed to satisfy any of the exceptions to the law of the case doctrine. a. Nambé did not seek review of the Transfer Order in the District Court or the Tenth Circuit. Nambé did not seek reconsideration of Judge Yarbrough’s Order in the transferor court and has not provided any explanation for its failure to do so. By letter to Judge Yarbrough, dated December 9, 2016 (a copy of which is attached hereto as Exhibit A), Nambé did request that the court allow it “a reasonable amount of time to determine whether to file a motion for a stay in order to file a petition for a writ of mandamus from the Tenth Circuit Court of Appeals for a review of the decision to transfer.” Nambé, however, never followed up after the letter; it neither filed a motion for a stay nor a petition for a writ of mandamus in the Tenth Circuit. Accordingly, the first exception does not apply. 9 HAB Carriers, Inc. v. Arrow Truck Sales, Inc., No. 07-cv-4390, 2009 U.S. Dist. LEXIS 74265 (D.N.J. Aug. 21, 2009), is the only case cited by Nambé where the transferee court granted a motion to retransfer. (See Br. at p. 24.) But in that case, the dismissal of one of the defendants was “an unforeseeable post-transfer event that frustrate[d] the original purpose of the transfer.” HAB Carriers, Inc., 2009 U.S. Dist. LEXIS 74265, at *5. In the case before this Court, however, nothing has changed since the court in the District of New Mexico entered the transfer Order, and therefore HAB Carriers is inapposite. Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 28 of 32 PageID: 350 22 FIRM:42957612 b. Nambé has not presented any new evidence in support of its motion. Nambé’s brief does not present any new evidence in support of its motion to retransfer the case. Rather, it merely argues that Judge Yarbrough erred in his application of the applicable law. Accordingly, the second exception does not apply. c. Nambé has not identified a new legal rule which is both valid and applicable to the issues of the case. Nambé’s brief does not identify any new legal rule which is valid and applicable to the issues of the case. Once again, it simply argues that Judge Yarbrough incorrectly applied the law to the facts of the case. Accordingly, the third exception does not apply. d. Nambé has not established that Judge Yarbrough’s decision was clearly erroneous and would work a manifest injustice. Nambé attacks Judge Yarbrough’s transfer Order solely on the grounds that it “is based on manifestly erroneous conclusions of law and facts” – making virtually the same arguments that the court rejected in Ulferts: Judge Yarbrough should not have discounted Nambé’s choice of forum and the convenience of its witnesses, and improperly assessed the relationship between its lawsuit and the case against Robedee already pending in this Court. (See Br. at pp. 24-29.) As Judge Martini found in Ulferts, none of Nambé’s arguments “approach[es] the showing necessary to establish that [Judge Yarbrough’s] decision is clearly erroneous and would work a manifest injustice.” 2007 U.S. Dist. LEXIS 49289, at *11. Rather, Nambé merely disagrees with Judge Yarbrough’s application of the law, making essentially the same arguments here as it did in opposition to the original motion to transfer – arguments that Judge Yarbrough rejected. (1) Nambé’s choice of forum. In his Memorandum Opinion and Order, Judge Yarbrough recognized that the plaintiff’s choice of forum “should rarely be disturbed,” but that the choice receives less deference “where Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 29 of 32 PageID: 351 23 FIRM:42957612 the facts giving rise to the lawsuit have no material relation or significant connection to the plaintiff’s chosen forum.” Nambé, 2016 U.S. Dist. LEXIS 169334 at *9 (quoting Employers Mutual Casualty Company v. Bartile Roofs, Inc., 618 F.3d 1153, 1168 (10th Cir. 2010)). Nambé’s brief cites to Employers Mutual and recognizes that Judge Yarbrough correctly stated its standard. (Br. at p. 24). Nambé’s unhappiness is not with some clearly erroneous law having been applied; rather, it disagrees with Judge Yarbrough’s application of the applicable law to the facts. That does not mean, however, that his conclusion was not “plausible” – and indeed, it was plausible. While recognizing that Nambé is organized under the laws of New Mexico and has a significant presence there, Judge Yarbrough also found that Nambé’s “upper management,” including the individuals who negotiated the confidentiality agreement and potential transaction with Lenox, resided outside of New Mexico, including New Jersey and states closer to New Jersey than New Mexico. Nambé, 2016 U.S. Dist. LEXIS 169334 at *10. He further found that Robedee, Nambé’s CEO and Lenox’s representative in the negotiations, resides in New Jersey. Id. at *11. Nambé’s brief fails to even mention these facts. Nambé’s brief also fails to recognize that Judge Yarbrough still “weigh[ed] Nambé’s choice of forum in its favor.” Id. Thus, no basis exists to conclude that Judge Yarbrough’s conclusion on this factor constituted some egregious, manifest error of law. (2) The Convenience of the Witnesses. With respect to the convenience of the witnesses and the parties, Judge Yarbrough analyzed the arguments advanced by Lenox and Nambé and concluded that his factor weighed in favor or transfer. Id. at *12-15. He found that Robedee, who he characterized as “one of the most central witnesses to this case,” lives in New Jersey – which is undisputed. Id. at *14. He Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 30 of 32 PageID: 352 24 FIRM:42957612 further observed that Nambé maintains an office in New Jersey, “from which its CEO [Robedee] conducts business” – which is also undisputed. Id. He further noted that Howard and Hillenbrand, “other key Nambé witnesses,” live closer to New Jersey than New Mexico, and that based on allegations in the Complaint, they were “likely to be the primary witnesses” with respect to “the impact disclosure of Nambé’s negotiations with Lenox had on Nambé’s business.” Id. He also considered the potential that Nambé might present at trial “some damage testimony from New Mexico witnesses.” Id. at *15. And he considered that the presence of Lenox’s witnesses closer to New Jersey also weighed in favor of transfer. Id. In support of its retransfer cross-motion, Nambé argues that Judge Yarbrough “disregarded the fact that Robedee travels frequently to New Mexico in connection with his duties as CEO of Nambé”; he should not have given weight to the convenience of other witnesses who resided closer to New Jersey than New Mexico; and he improperly discounted the convenience of Nambé’s damages witnesses. (Br. at pp. 26-27.) But for purposes of Nambé’s cross-motion, it is not enough that Nambé disagrees with Judge Yarbrough’s analysis, and Nambé has come nowhere close to meeting the high standard for rejecting principles of comity. (3) The Pendency of the Robedee Case in New Jersey. In analyzing the “interest of justice” factor, Judge Yarbrough considered the pendency of the Robedee litigation already before this Court. Nambé, 2016 U.S. Dist. LEXIS 169334 at *18. Ultimately, he found that “the substantial overlap between witnesses, facts, and issues in [the New Mexico action] and Lenox’s New Jersey lawsuit weigh in favor of transfer. Id. at *18-19. He specifically noted that Nambé’s New Mexico lawsuit “arose from disclosures Lenox made in its Complaint in the New Jersey lawsuit.” Id. at *19. He also found that “the key witnesses” were the same in both cases. Id. And he wrote that given the overlap, “it [was] highly probable Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 31 of 32 PageID: 353 25 FIRM:42957612 that the District of New Jersey, pursuant to its local rules, would assign the case to the same Judge currently handling Lenox’s suit against Robedee and Scala” (id.); of course, that is precisely what happened. Again, Nambé disagrees with Judge Yarbrough’s conclusion, this time arguing that “the Robedee Action and this action are wholly separate and distinct.” (Br. at p. 28). As before, however, Nambé’s unhappiness with the result in New Mexico does not mean that this Court should reject the principles of comity and send this case back to New Mexico. Indeed, Judge Yarbrough’s analysis was not only plausible, it was well-reasoned. In sum, Nambé’s cross-motion does not approach the showing necessary to establish that Judge Yarbrough’s decision is clearly erroneous and would work a manifest injustice.10 CONCLUSION For the foregoing reasons, the Court should dismiss the Complaint in its entirety and deny Nambé’s cross-motion to retransfer the case to the U.S. District Court for the District of New Mexico. Respectfully submitted, EPSTEIN BECKER & GREEN, P.C. Attorneys for Defendant Lenox Corporation By: s/ David W. Garland DAVID W. GARLAND For the Firm Dated: February 14, 2017 10 Citing no legal authority, Nambé also argues that “there would be no prejudice to [Lenox] in retransferring this action.” (Br. at p. 29). Even if that were true – and it obviously is not – Nambé is once again improperly asking this Court to reexamine Judge Yarbrough’s implicit determination that transfer to New Jersey from New Mexico would not prejudice either party. See Nambé, 2016 U.S. Dist. LEXIS 169334 at *12-16 (holding that New Jersey is a more convenient forum for the witnesses and the parties and that the action would be less expensive if litigated in New Jersey). Case 3:16-cv-09150-BRM-DEA Document 27 Filed 02/14/17 Page 32 of 32 PageID: 354 Exhibit A Case 3:16-cv-09150-BRM-DEA Document 27-1 Filed 02/14/17 Page 1 of 2 PageID: 355 Case 3:16-cv-09150-BRM-DEA Document 27-1 Filed 02/14/17 Page 2 of 2 PageID: 356 Firm:42978332v1 EPSTEIN BECKER & GREEN, P.C. Document Filed Electronically David W. Garland, Esq. One Gateway Center Newark, New Jersey 07102-5003 (973) 642-1900 Attorneys for Defendant Lenox Corporation UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x NAMBE, LLC, : : : : : : : : x Civil Action No.: 3:16-cv-09150-BRM-DEA CERTIFICATE OF SERVICE Plaintiff, - v. - LENOX CORPORATION, Defendant. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - I hereby certify that on February 14, 2017, I caused Lenox Corporation’s Reply Brief, in Support of its Motion to Dismiss and in Opposition to Nambé, LLC’s Cross-Motion to Transfer to be filed via Electronic Case Filing (ECF) with the Clerk of the United States District Court for the District of New Jersey, and to be served upon plaintiff, via e-mail to Elizabeth Ann Carbone, Esq. and Randi W. Kochman, Esq., Cole Schotz P.C., attorneys for plaintiff at 25 Main Street, Court Plaza North, Hackensack, NJ 07601. s/ David W. Garland__ David W. Garland Epstein Becker & Green, P.C. One Gateway Center, 13th Floor Newark, New Jersey 07102-5003 Telephone: (973) 642-1900 Facsimile: (973) 642-0099 Email: DGarland@ebglaw.com Dated: February 14, 2017 Case 3:16-cv-09150-BRM-DEA Document 27-2 Filed 02/14/17 Page 1 of 1 PageID: 357