Direct Components, Inc. v. Microchip USA, LLC et al

Filing 213

ORDER: Defendant Michael Prusik's Motion for Rule 11 Sanctions. (Doc. # 136) is DENIED without prejudice. Signed by Judge Virginia M. Hernandez Covington on 3/11/2025. (RAS)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
DIRECT COMPONENTS, INC.,
Plaintiff,
v.

Case No. 8:23-cv-1617-VMC-SPF

MICROCHIP USA, LLC, ET. AL.,
Defendants.
_____________________________/
ORDER
This cause comes before the Court upon Defendant Michael
Prusik’s Motion for Rule 11 Sanctions. (Doc. # 136). Plaintiff
Direct

Components,

Inc.

(“DCI”)

responded

in

opposition.

(Doc. # 165). For the reasons that follow, the Motion is
denied without prejudice.
I.

Discussion
On July 18, 2023, DCI initiated this lawsuit against

Microchip USA, LLC and several individual Defendants. (Doc.
# 1). On May 16, 2024, DCI filed its second amended complaint,
which is the operative complaint. (Doc. # 55). It alleges
nine counts against Defendants, but relevant to this Motion,
Count Four is pled exclusively against Michael Prusik. Count
Four alleges that Mr. Prusik committed a breach of contract
by violating his non-competition agreement. (Id. at 32-33).
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The

allegation

cites

to

Exhibit

C,

which

contains

two

employment contracts – one signed by Joe Centrone and another
signed by Mr. Prusik. (Doc. # 55-3). The agreement signed by
Mr.

Prusik

is

titled

as

a

“Confidentiality

and

Nonsolicitation Agreement.” (Id. at 10-17).
On October 16, 2024, DCI filed a motion for leave to
file an amended complaint, which would “correct a scrivener’s
error

in

applicable

reference

to

Defendant

Michael

restrictive

covenant

he

Prusik

executed

and

along

the
with

allegations stemming from such error.” (Doc. # 134 at 2). On
November 20, 2024, the Court denied the motion, finding that
DCI failed to satisfy Rule 16’s requirements. (Doc. # 173).
On November 11, 2024, Mr. Prusik filed a motion for
judgment on the pleadings on Count Four, arguing that “[t]he
contract executed by Prusik that is attached to the Second
Amended Complaint as part of Composite Exhibit C contradicts
DCI’s

allegations

in

Count

IV

of

the

Second

Amended

Complaint.” (Doc. # 154 at 5). On December 2, 2024, DCI
responded in opposition, arguing that “DCI provided a copy of
Prusik’s restrictive covenant agreement as an exhibit. And
that exhibit controls over any contrary language within the
Second Amended Complaint.” (Doc. # 174 at 7). However, on
December 27, 2024, Mr. Prusik filed a notice of withdrawal of
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his motion for judgment on the pleadings. (Doc. # 179).
In that notice, Mr. Prusik explained that he “will address
DCI’s unusual

allegations

in

a

summary

judgment

motion

instead.” (Id. at 2).
Mr. Prusik filed his Motion for Rule 11 Sanctions on
October 23, 2024. (Doc. # 136). DCI responded on November 14,
2024. (Doc. # 165). The Motion is now ripe for review.
In the Motion, Mr. Prusik argues that “DCI’s claim that
Michael Prusik breached an alleged non-competition clause is
objectively

frivolous”

and,

accordingly,

DCI’s

counsel

“failed to make a reasonable inquiry into the law prior to
filing its Second Amended Complaint and subsequent filings as
required by Rule 11(b). Thus, sanctions should be imposed.”
(Doc. # 136 at 8).
However, it would be inappropriate for the Court to make
such a finding at this juncture. Mr. Prusik’s argument assumes
that Count Four is “frivolous.” (Id.). Therefore, the Motion
and Mr. Prusik’s forthcoming motion for summary judgment on
this Count are intertwined because each ask or will ask the
Court to find that DCI cannot prove Count Four as a matter of
law. To rule on this Motion without first ruling on the
eventual motion for summary judgment, the Court would be
casting judgment on the merits of the underlying Count without
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evaluating the record in its entirety. See Welsh v. Martinez,
No. 2:22-cv-216-JLB-NPM, 2023 WL 130752, at *3 (M.D. Fla.
Jan.

9,

2023)

(denying

a

motion

for

sanctions

without

prejudice because it would be “simply premature for the Court
to determine whether the Amended Complaint is so frivolous as
to be subject to Rule 11 sanctions” before the claim “may be
resolved on a summary judgment motion or may have to be
resolved at trial”).
As such, the Court denies the Motion. However, the Court
does so without prejudice because Mr. Prusik may re-file his
Motion upon disposition by the Court of Count Four of the
operative complaint. See KB Home v. Smith, No. 8:13-cv-2644JDW-E_J, 2014 WL 12621583, at *2 (M.D. Fla. May 7, 2014)
(“[I]t is not possible to determine on this record if the
allegations

of

the

Amended

Complaint

are

objectively

frivolous in view of the law and facts . . . . Imposition of
sanctions is more appropriately considered at the end of the
litigation.”).
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
Defendant Michael Prusik’s Motion for Rule 11 Sanctions.
(Doc. # 136) is DENIED without prejudice.

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DONE and ORDERED in Chambers in Tampa, Florida, this
12th day of March, 2025.

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