Coan v. Dunne

          OMNIBUS RULING ON DEFENDANTS' MOTIONS IN LIMINE

          Jeffrey Alker Meyer United States District Judge.

         This is a financial fraud case that is related to bankruptcy proceedings involving real estate developer Sean Dunne. See Coan v. Dunne, 2019 WL 302674, at *1-*2 (D. Conn. 2019) (generally describing the history of this case). Defendants have filed numerous motions in limine with respect to the claims and evidence plaintiffs may introduce at trial. At a pretrial conference on April 26, 2019, I heard extensive oral argument from the parties on, inter alia, defendants' motions. As noted in the Court's memorandum of hearing and order (Doc. #426), I ruled on many of these motions at the hearing. I took under advisement defendants' motions in limine to preclude evidence as to Amrakbo (Doc. #368); Newinvest, the Bloem Settlement, and Yesreb (Doc. #370); 151 Milbank (Doc. #371); the Lagoon Beach Hotel and Belgravia House (Doc. #372); defendant Gayle Killilea's deposition testimony from the 151 Milbank bankruptcy proceeding (Doc. #373); the IGB Lands and Beara properties (Doc. #375); and evidence of subsequent financial transfers (Doc. #382). I also took under advisement defendant John Dunne's motion for judgment on the pleadings (Doc. #374). Having further considered the parties' arguments, I decide these motions now in this ruling.

         Motion to limit evidence to claims in the complaints (Doc. #369)

         Although I ruled on this motion at the pretrial conference, I will discuss it briefly to help clarify my ruling as to the remaining motions in limine. Defendants filed this motion in limine to limit the evidence the Trustee presents at trial to the claims asserted in the claims in the removed state court proceeding, see Doc. #1-1, and bankruptcy adversary proceeding, see Doc. #189 to Coan v. Killilea, No. 15-05019 (Bankr. D. Conn. 2016), that have been consolidated before me, see Doc. #52. Courts routinely bar parties from raising new claims on the eve of trial, see, e.g., Rao v. Rodriguez, 2017 WL 1403214, at *6 n.4 (E.D.N.Y. 2017); Missigman v. USI Northeast, Inc., 131 F.Supp.2d 495, 517-18 (S.D.N.Y. 2001), and the Trustee may not use the joint trial memorandum as a backdoor way of doing so. And for substantially the reasons stated by defendants, I rejected the Trustee's suggestion that I allow the Trustee to file a second amended complaint: allowing new claims after the close of discovery and less than a week before jury selection would cause defendants substantial prejudice. See Tiffany (NJ) Inc. v. eBay, Inc., 576 F.Supp.2d 460, 462-63 (S.D.N.Y. 2007) (Sullivan, J.).

         Accordingly, I granted defendants' motion in part, insofar as to rule that the Trustee may not pursue any claims that he has not alleged in the operative complaints in this case. I also denied defendants' motion in part, insofar as my ruling on that motion does not necessarily preclude the Trustee from introducing any of the evidence discussed in that motion-or any other evidence-solely to prove up the claims that the Trustee has alleged. It is in light of this determination that I address the bulk of defendants' remaining motions in limine, which are-in large part-more specific instances of the same issues.

         Motion to preclude evidence as to Amrakbo (Doc. #368)

         Defendants' first motion in limine asks me to preclude as irrelevant and prejudicial evidence regarding the Irish corporate entity Amrakbo. Doc. #368 at 1. Amrakbo is not a party to this case, nor does the Trustee allege that Amrakbo was, itself, fraudulently transferred. See Doc. #1-1 at 1; Doc. #189 at 1 to Coan v. Killilea, No. 15-05019 (Bankr. D. Conn. 2016). Because I have limited the Trustee's claims to those alleged in the complaints, he may not add new claims against Amrakbo now. Still, Amrakbo is the subject of several factual allegations in the adversary complaint, such as the alleged funneling through Amrakbo of one of Sean Dunne's properties to Killilea. See Doc. #189 at 34 (¶ 63) to Coan v. Killilea, No. 15-05019 (Bankr. D. Conn. 2016). Because evidence should only be excluded on a motion in limine if it is inadmissible on all potential grounds, see Hart v. RCI Hospitality Holdings, Inc., 90 F.Supp.3d 250, 257 (S.D.N.Y. 2015), I will grant defendants' motion only in part-as to evidence that is solely relevant to support claims against Amrakbo not alleged in the complaints-but will deny defendants' motion as to any evidence that involves Amrakbo that is used to prove claims as to different properties and entities that the Trustee has alleged.

         Motion to preclude as to Newinvest, the Bloem Settlement, and Yesreb (Doc. #370)

         Defendants' third motion in limine asks me to preclude as irrelevant and prejudicial evidence about three more companies: Newinvest, the Bloem Settlement, and Yesreb. Doc. #370 at 1. As with Amrakbo, none of these entities is a party to this case. But also as with Amrakbo, the Trustee has shown that evidence about each of them will be relevant to the claims the Trustee alleges. The Trustee alleges that defendants fraudulently transferred the property at 22 Stillman Lane in Greenwich, Connecticut, see Doc. #1-1 at 17-18 (¶¶ 68-74), and in factual allegations about that transfer, states that Newinvest was used to encumber the property as a mortgagee, see Doc. #189 at 29 (¶ 124) to Coan v. Killilea, No. 15-05019 (Bankr. D. Conn. 2016). Although neither complaint mentions the Bloem Settlement by name, the Trustee argues that defendants used the Bloem Settlement as a vehicle to fund the purchase of properties in Connecticut that are discussed in the complaints, see Doc. #1-1 at 8-11 (¶¶ 28-36), and that evidence of defendants' use and control of the Bloem Settlement is relevant to the Trustee's fraudulent transfer claims. Doc. #408 at 8. Similarly, while neither complaint uses the name “Yesreb, ” the adversary complaint alleges that Sean Dunne fraudulently transferred the Walford property in Ireland “to an offshore entity, ” Doc. #189 at 32-33 (¶¶ 147, 153) to Coan v. Killilea, No. 15-05019 (Bankr. D. Conn. 2016), and seeks to recover from John Dunne as transferee, id. at 50 (¶¶ 308-10). The Trustee contends that discovery has revealed that Yesreb is a Cypriot entity to which Walford was transferred, and that John Dunne is the beneficiary of Yesreb. Doc. #408 at 9-10. Accordingly, I am persuaded that evidence involving each of Newinvest, the Bloem Settlement, and Yesreb may be relevant to proving the Trustee's existing claims. As with Amrakbo, I will therefore grant defendants' motion in part and deny it in part. The Trustee may present evidence about each of these entities that goes to prove the elements of the claims he alleges in the operative complaints. But he may not present any evidence that exceeds these bounds and goes to prove unalleged claims against or involving these entities.

         Motion to preclude as to 151 Milbank (Doc. #371)

         Defendants' fourth motion in limine asks me to preclude evidence related to 151 Milbank, LLC on the ground that 151 Milbank is currently in bankruptcy and subject to an automatic bankruptcy stay. Doc. #371 at 1; see 11 U.S.C. § 362(a); In re 151 Milbank, LLC, No. 15-51485 (Bankr. D. Conn. 2015). But automatic stays generally apply only to claims involving the debtor, see Queenie, Ltd. v. Nygard Int'l, 321 F.3d 282, 287 (2d Cir. 2003), and the Trustee maintains that the claims he intends to pursue at trial are not subject to the stay because they are only against other parties, and not 151 Milbank itself. Doc. #400 at 2-4. This action is, of course, stayed insofar as any claim might be asserted against 151 Milbank. But inasmuch as the adversary complaint includes, inter alia, factual discussions of 151 Milbank, see Doc. #189 at 32 (¶¶ 141-144) to Coan v. Killilea, No. 15-05019 (Bankr. D. Conn. 2016), I am persuaded that there may be evidence concerning 151 Milbank that is relevant to claims the Trustee is pursuing that are against other entities. Accordingly, I will grant defendants' motion to the extent that the Trustee may not introduce evidence that is only relevant to stayed claims against 151 Milbank (or any other claims not alleged in the complaint), but deny the motion insofar as the Trustee may introduce relevant evidence regarding 151 Milbank that goes to prove any non-stayed claims that the Trustee asserts in the two operative complaints.

         Motion to preclude evidence as to IGB Lands and Beara properties (Doc. #375)

         Defendants' eighth motion in limine asks me to preclude the Trustee from introducing evidence about the IGB Lands and Beara properties on the ground that any claim as to these two properties is moot. Doc. #375 at 1. The Trustee has contested defendants' assertions of mootness, claiming in part that Killilea maintains an interest. Doc. #408 at 14-15. The Trustee's adversary complaint unambiguously asserts claims to both sets of properties. Doc. #189 at 47-49 (¶¶ 276-97) to Coan v. Killilea, No. 15-05019 (Bankr. D. Conn. 2016). Accordingly, should the validity of these claims be an issue at trial, evidence about the properties will be relevant. See Fed. R. Evid. 401. By asking me to rule that evidence of these alleged transfers is irrelevant because the Trustee's claims are moot, defendants have attempted to package a motion for summary judgment in the form of a motion in limine. But “an in limine motion is generally not the appropriate vehicle for effecting the dismissal of entire claims, ” MF Global Holdings Ltd. v. PricewaterhouseCoopers LLP, 232 F.Supp.3d 558, 578 (S.D.N.Y. 2017), and dismissal of a claim on an in limine motion lacks the procedural safeguards of Rule 56. See C & E Servs., Inc. v. Ashland Inc., 539 F.Supp.2d 316, 323 (D.D.C. 2008). I will therefore deny defendants' motion, and allow the Trustee to present evidence as to the IGB Lands and Beara properties relevant to the claims for the fraudulent transfer of those properties he alleges.

         Motion to preclude evidence as to Lagoon Beach and ...