14-3551-cv Pullman v. Alpha Media, Inc.

14‐3551‐cv Pullman v. Alpha Media, Inc.

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007 IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURTʹS LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION ʺSUMMARY ORDERʺ). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 24th day of September, two thousand fifteen.

PRESENT: ROBERT D. SACK, DENNY CHIN, CHRISTOPHER F. DRONEY, Circuit Judges.

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JACLINN PULLMAN, Plaintiff‐Appellant,

v. 14‐3551‐cv

ALPHA MEDIA PUBLISHING, INC., FKA DENNIS PUBLISHING, INC., QUADRANGLE GROUP, LLC, STEPHEN COLVIN, DOES 1‐20, ALPHA MEDIA GROUP, INC., Defendants‐Appellees,

PETER EZERSKY, Defendant.

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FOR PLAINTIFF‐APPELLANT: JACLINN PULLMAN, pro se, Tenafly, New Jersey.

FOR DEFENDANTS‐APPELLEES: CHARLES J. KEELEY, James F. Rittinger, Justin Klein, , Satterlee Stephens Burke & Burke LLP, New York, New York, PATRICK D. BONNER JR., John R. Menz, Joshua S. Hackman, Menz Bonner Komar & Koenigsberg LLP, New York, New York, JOSHUA H. EPSTEIN, Sara Hausner‐Levine, Davis & Gilbert LLP, New York, New York.

Appeal from orders of the United States District Court for the Southern

District of New York (Crotty, J., and Netburn, M.J.).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED, AND DECREED that the orders of the district court are AFFIRMED.

Appellant Jaclinn Pullman, proceeding pro se, appeals from certain orders

of the district court, including its orders entered March 28, 2013, November 6, 2013,

September 10, 2014, and September 23, 2014.1 In particular, Pullman alleges that the

district court erred or abused its discretion in (1) dismissing her claim against

defendant‐appellee Stephen Colvin in his individual capacity under the New Jersey

Consumer Fraud Act (the ʺCFAʺ), and denying her motions for leave to amend and for

1 Pullman filed her notice of appeal on September 24, 2014. The district court did not enter a final judgment in the case, but the September 10, 2014 order was in essence the ʺfinalʺ order of dismissal, as it directed the Clerk of the Court to close the case and defendants‐ appellees have not objected to the taking of this appeal. See Selletti v. Carey,

, 109‐10 (2d Cir. 1999). We consider the district courtʹs earlier orders, including the March 28, 2013 and November 6, 2013 orders, which were not ʺfinal,ʺ as merged into the final order of dismissal. See

at 109 & n.5 (citing Allied Air Freight, Inc. v. Pan Am. World Airways, Inc.,

(2d Cir. 1968)).

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reconsideration in this respect, (2) enforcing an oral settlement agreement between

Pullman and the corporate defendants, and (3) sealing the transcript of a settlement

conference and the settlement amount. Pullman also moves before this Court to strike a

portion of one of the defendant‐appelleeʹs briefs, and for this Court to take judicial

notice of new evidence and of the magistrate judgeʹs ruling in another case.

The suit arises from Pullmanʹs claim that the defendants deceived her into

investing in the Maxim Bungalows timeshare in the Dominican Republic, by

misrepresenting that Maxim owned the timeshare when in fact it had merely licensed

its trademark to the developer. Had she known of Maximʹs limited involvement,

Pullman alleges, she would not have invested in the timeshare, which was purported to

be a Ponzi scheme. Colvin was formerly an officer of defendant‐appellee Alpha Media

Group, Inc.

We assume the partiesʹ familiarity with the underlying facts, procedural

history of the case, and issues on appeal.

1. The CFA Claim Against Colvin

We review de novo both the dismissal for failure to state a claim and the

denial of leave to amend as futile. See Am. Civil Liberties Union v. Clapper,

(2d Cir. 2015); L‐7 Designs, Inc. v. Old Navy, LLC,

(2d Cir. 2011).

We review the denial of reconsideration for abuse of discretion. Johnson v. Univ. of

Rochester Med. Ctr.,

, 125 (2d Cir. 2011).

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The complaint must plead ʺenough facts to state a claim to relief that is

plausible on its face,ʺ Bell Atlantic Corp. v. Twombly,

(2007), and ʺallow[]

the court to draw the reasonable inference that the defendant is liable for the

misconduct alleged,ʺ Ashcroft v. Iqbal,

(2009). To state a CFA claim, a

plaintiff must allege: ʺ1) unlawful conduct by defendant; 2) an ascertainable loss by

plaintiff; and 3) a causal relationship between the unlawful conduct and the

ascertainable loss.ʺ Bosland v. Warnock Dodge, Inc.,

(2009). Corporate

officers can be ʺindividually liable pursuant to the CFA for their affirmative acts of

misrepresentation to a consumer.ʺ Allen v. V & A Bros., Inc.,

(2011); see,

e.g., G & F Graphic Servs., Inc. v. Graphic Innovators, Inc.,

, 587‐88 (D.N.J.

2014) (finding that plaintiff had sufficiently pleaded individual liability under CFA

where complaint alleged that defendant ʺhimself made a material misrepresentationʺ to

plaintiff). However, ʺthe factual circumstances that would support such relief have

been limited.ʺ Green v. Morgan Props.,

(2013).

Upon review, we conclude that the district court correctly ruled that

Pullmanʹs complaint failed to state a CFA claim against Colvin, and that leave to amend

would have been futile. We affirm for substantially the reasons set forth by the district

court in its March 28, 2013 order, adopting the magistrate judgeʹs report and

recommendation. Moreover, the denial of Pullmanʹs motion for reconsideration and

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leave to amend, in light of the allegations raised in the motion, was not erroneous.

None of the new evidence on which Pullman relies cures the defects in her complaint.

Pullman does not allege that Colvin made any statements to her directly,

misleading or otherwise. Instead, she relies on Colvinʹs involvement in, among other

things, designing and appearing in some of the marketing materials for the timeshare.

She contends that Colvin claimed in promotional appearances to be ʺvery excited to be

in partnership with [the timeshare developer] to develop the Maxim Bungalows,ʺ

Docket No. 80 at 7, and that this ʹpartnershipʹ implied ownership of the Bungalows. But

Colvinʹs reference to the partnership, and his statements in marketing materials, could

just as naturally refer to what was in fact the licensing agreement between Alpha Media

Publishing, Inc. and the timeshare developer.

Pullman fails to connect Colvin to any of the marketing materials that did

arguably misrepresent the ownership of Maxim Bungalows in violation of the CFA.

Moreover, she does not allege that she relied on any of Colvinʹs statements or materials,

or that Pullman knew of Colvinʹs statements prior to her purchase of the timeshare.

Thus a ʺcausal relationshipʺ is not plausibly alleged. Bosland,

. Nor does

Pullman plausibly allege that Colvin directed others to violate the CFA.

2. The Settlement

On appeal, Pullman argues for the first time that the September 10, 2013

oral settlement agreement is not binding. We do not ordinarily consider claims raised

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for the first time on appeal, Bogle‐Assegai v. Connecticut,

(2d Cir. 2006),

and there is no reason to do so in this case. In the district court, Pullman took the

opposite position by moving to enforce the oral agreement, and she acknowledges she

could have contested the enforceability of the oral settlement in her objections to the

magistrate judgeʹs recommendation to grant, in part, that motion. Because Pullman had

ʺevery incentive and opportunityʺ to challenge the oral settlement in the district court

proceedings, we decline to address this argument. Bogle‐Assegai,

.2

As to the arguments Pullman did raise in the district court, we review for

clear error a district courtʹs findings as to the meaning of ambiguous settlement terms.

Manning v. New York Univ.,

(2d Cir. 2002) (per curiam). The district

court ʺha[s] ample authority to clarify ambiguities in the description of the settlement

reached [on the record] by crafting the terms at issue.ʺ

. Our review of the

record and relevant case law reveals no errors in the district courtʹs ruling as to the

scope of the release and the meaning of ambiguous and unspecified terms. The

principal issue is whether the phrase ʺmutual release of all parties and all employees

and agents, et ceteraʺ set forth on the record at the settlement conference included

Colvin. The district court concluded that the parties clearly intended to release former

employees, including Colvin, in their official (but not individual) capacities. We affirm

2 While Pullman argued in her appellate brief that the oral settlement agreement was not binding, she clarified during oral argument that she was not challenging the enforceability of the oral agreement but rather sought to have it enforced as stated on the record.

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for substantially the reasons stated by the district court in adopting the magistrate

judgeʹs report and recommendation.

3. The Courtʹs Sealing Order and Pullmanʹs Motions

The district court sealed the transcript of an October 2013 settlement

conference as well as the settlement amount, referenced in a September 2013 settlement

conference, although it acknowledged that the settlement amount had been publicly

disclosed when a third party posted the September 2013 transcript on a website. We

review the sealing decision for abuse of discretion, but because the sealing of

documents implicates First Amendment concerns, it warrants ʺclose appellate scrutiny.ʺ

Newsday LLC v. County of Nassau,

(2d Cir. 2013).

Though there is a common law presumptive right of access to judicial

documents, United States v. Erie Cty., N.Y.,

(2d Cir. 2014), a court

considers the weight to be given to this presumption in light of ʺthe role of the material

at issue in the exercise of Article III judicial power and the resultant value of such

information to those monitoring the federal courts.ʺ United States v. Amodeo,

(2d Cir. 1995). In deciding whether to seal a judicial document, we have held

that ʺaccess to settlement discussions and documents has no value to those monitoring

the exercise of Article III judicial power by the federal courts.ʺ United States v. Glens

Falls Newspapers, Inc.,

(2d Cir. 1998). The ʺpresumption of access to

settlement negotiations . . . is negligible to nonexistent.ʺ

.

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The district court did not abuse its discretion in sealing the October 2013

settlement conference transcript. The court did not rely on that transcript in deciding

subsequent motions to enforce the settlement agreement. It therefore played no role in

the courtʹs exercise of judicial power, and there is less of a public interest in access to the

document.

The district court also did not abuse its discretion in redacting the

settlement amount, as referenced in the transcript of the September 2013 settlement

conference. See

at 857‐58. As part of her argument for the unsealing of the

settlement amount, Pullman contends that the amount is already in the public domain.

She points to Gambale v. Deutsche Bank AG, where we held that after a confidential

settlement amount was made public, it could no longer be made private again.

(2d Cir. 2004). In Gambale, though, the defendants appealed from the district

courtʹs un‐sealing of previously sealed documents that contained settlement terms. It

was the district court that publicly disclosed the magnitude of the settlement, referring

to it in its unsealing order. That unsealing order was accessible on Westlaw and Lexis,

and was ʺdisseminated prominentlyʺ in a New York Times article ‐‐ this Court had no

means ʺto put the genie back [in the bottle].ʺ

Here, Pullman appeals from the

district courtʹs sealing ‐‐ rather than un‐sealing ‐‐ order, which redacted the settlement

amount soon after the September 2013 transcript became available. It was a third party

who posted the unredacted transcript, and it was a limited disclosure on an online

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message forum rather than a court order available on ʺhighly accessible databases,ʺ

and in the national media.

In support of her challenge to the sealing of the settlement amount, as

referenced in the September 2013 conference transcript, Pullman moves before this

Court for the Court to take judicial notice of evidence that was not presented to the trial

court ‐‐ the number of times the September 2013 transcript has allegedly been viewed

online by members of the public. However, we limit our review to the record on

appeal. See Loria v. Gorman,

, 1280 n.2 (2d Cir. 2002); Intʹl Bus. Machs. Corp.

v. Edelstein,

, 45 (2d Cir. 1975) (per curiam) (ʺ[A]bsent extraordinary

circumstances, federal appellate courts will not consider rulings or evidence which are

not part of the trial record.ʺ). Her motion to take judicial notice of this new evidence is

therefore denied, as is her request that we strike a portion of an appelleeʹs brief and her

request that we take judicial notice of a recent magistrate judge decision.

We have considered all of Pullmanʹs remaining arguments and find them

to be without merit. Accordingly, we AFFIRM the orders of the district court and

DENY Pullmanʹs motions.

FOR THE COURT: Catherine OʹHagan Wolfe, Clerk

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