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SMK Associates, LLC v. Sutherland Global Services, Inc.

United States District Court, N.D. Illinois, Eastern Division

May 19, 2017

SMK ASSOCIATES, LLC, Plaintiff,
v.
SUTHERLAND GLOBAL SERVICES, INC., and MICHAEL BARTUSEK, Defendants.

          MEMORANDUM OPINION AND ORDER

          John Z. Lee United States District Judge

         Plaintiff SMK Associates, Inc. (“SMK”), brought suit against Sutherland Global Services, Inc. (“Sutherland”) and its former CFO, Michael Bartusek (“Bartusek”), alleging that Sutherland breached two contracts to sell SMK $84 million in tobacco products. Sutherland moved for summary judgment, arguing in part that SMK had not produced evidence from which a reasonable jury could find that it was ready, willing, and able to purchase the tobacco products. For this reason, Sutherland argued that SMK could not make out a prima facie case of breach of contract. The Court disagreed, finding that SMK had produced such evidence, and denied Sutherland's motion in this and all other respects [134]. Sutherland has moved the Court to reconsider its ruling in respect to SMK's readiness, willingness, and ability to perform. For the reasons that follow, Sutherland's motion for reconsideration [136] is denied.

         Background

         SMK, an Illinois limited liability company, is comprised of one member: Martin Borg (“Borg”). SMK Assocs., LLC v. Sutherland Glob. Servs., Inc., No. 14 C 284, 2016 WL 5476256, at *1 (N.D. Ill. Sept. 29, 2016). In early 2012, Borg began working on a deal with Bartusek in which SMK would purchase $84 million in tobacco products (specifically, cigarettes). Id. Believing the parties had a deal, SMK submitted two purchase orders for cigarettes totaling $84 million to Bartusek at his Sutherland office in June and July 2012. Id. SMK never received the cigarettes and sued for breach of contract. See Pl.'s LR 56.1(b)(3)(C) Stmt. ¶ 52, ECF No. 116;[1] 2d Am. Compl. ¶ 2, ECF No. 40.

         In its motion for summary judgment, Sutherland argued that SMK needed to prove that it was ready, willing, and able to perform its obligations under the purported contract in order to sue for breach and recover damages. See SMK Assocs., 2016 WL 5476256, at *3. SMK disputed whether this requirement exists under Illinois law. Id. The Court declined to resolve whether Illinois law imposes such a requirement. Id. Instead, the Court explained that, even if SMK had to prove that it was ready, willing, and able to perform under the contract, it had offered evidence from which a reasonable jury could rule in its favor. Id. Specifically, the Court noted that “Borg's testimony suggests that he did in fact have buyers to whom he could have sold the tobacco.” Id. The Court further reasoned as follows:

During Borg's deposition he is asked who wo1uld have purchased the tobacco had Sutherland delivered it-in other words, who would have given SMK the funds necessary to turn around and pay Sutherland what it was owed. Borg explained that he had compiled a list of people he had spoken to who were willing to buy the tobacco. And although Borg did not have contracts with these individuals and had not previously sold tobacco to any of them, he was confident that the product would have sold. Sutherland calls this testimony speculation, suggesting that it is somehow inadmissible. But on summary judgment, such credibility determinations are impermissible. Even assuming that SMK has a duty to prove that it could have performed, Borg's testimony is enough at this stage to withstand Sutherland's motion for summary judgment on this issue.

Id. (internal citations omitted).

         Legal Standard

         District courts have discretion to entertain motions to reconsider prior decisions. See Patrick v. City of Chi., 103 F.Supp.3d 907, 911 (N.D. Ill. 2015); Fed.R.Civ.P. 54(b); see also Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 12 (1983) (“[E]very order short of a final decree is subject to reopening at the discretion of the district judge.”). But while motions for reconsideration are permitted, “they are disfavored.” Patrick, 103 F.Supp.3d at 911. They serve a very limited purpose: correcting manifest errors of law or fact and presenting newly discovered evidence. Id. (citations omitted). This is a heavy burden for the moving party and makes a motion for reconsideration an inappropriate medium to “rehash” past arguments, id. at 912 (citations omitted), or revisit improvident strategic decisions made earlier, Birdo v. Dave Gomez, No. 13 C 6864, 2016 WL 6070173, at *1 (N.D. Ill. Oct. 17, 2016) (citation omitted). Motions for reconsideration will be granted only where “the Court has patently misunderstood a party, or has made a decision outside the adversarial issues presented to the Court by the parties, or has made an error not of reasoning but of apprehension.” Bank of Waunakee v. Rochester Cheese Sales, Inc., 906 F.2d 1185, 1191 (7th Cir. 1990) (citation omitted). Given these exacting standards, issues appropriate for reconsideration “rarely arise and the motion to reconsider should be equally rare.” Id. (citation omitted).

         Analysis

         Sutherland has moved the Court to reconsider its conclusion that SMK produced evidence from which a reasonable jury could conclude it was ready, willing, and able to perform under the parties' purported contract. It asserts that the Court made an error of law in determining that Borg's deposition testimony was not speculative and interpreting Sutherland's arguments as going to Borg's credibility. Def.'s Mem. Supp. Mot. Recons. 1, 7-9, ECF No. 137.[2]

         This is precisely the argument that Sutherland made and the Court rejected on summary judgment, rendering Sutherland's argument inappropriate to raise in a motion to reconsider. Birdo, 2016 WL 6070173, at *1. As the Court explained in its previous opinion, “Borg's testimony suggests that he did in fact have buyers to whom he could have sold the tobacco.” See SMK Assocs., 2016 WL 5476256, at *3. Specifically, Borg testified at his deposition as follows:

The purchase orders that we issued were specifically for the products that we believe that we had accumulated enough clients to sell to. . . . [W]e had a group of clients that had indicated that they were ready, willing, and able to purchase this product. We had full faith and belief in our research that they would be able to buy this product. I believe that in our estimation we had customers that at that point in time could purchase 30 to 40 containers worth of product a month, and we decided we could issue a purchase order for ten containers a month.

Def.'s LR 56.1(a)(3) Stmt., Ex. 5 (“Borg Dep.”), at 231:2-17, ECF No. 101-5. As the Court then elaborated, “Borg explained that he had compiled a list of people he had spoken to who were willing to buy the tobacco. And although Borg did not have contracts with these individuals and had not previously sold tobacco to any of them, he was confident that the product would have sold.” See ...


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