Ross v. Rothstein

Filing 240

MEMORANDUM AND ORDER denying 208 plaintiff Stanton E. Ross's motion under Federal Rule of Civil Procedure 54(h) for order striking declaration of Stephen Gans. Signed by District Judge John W. Lungstrum on 05/30/2014. (ses)

IN THE UNITED STATES DISTRICT COURT
DISTRICT OF KANSAS
Stanton E. Ross,
Plaintiff/Counterclaim Defendant,
v.

Case No. 13-CV-2101

Adam Rothstein,
Defendant/Counterclaimant.
MEMORANDUM & ORDER
Plaintiff Stanton E. Ross is the Chief Executive Officer of and a substantial shareholder
in Infinity Energy Resources, Inc. (“Infinity”). Mr. Ross filed a petition in state court against
defendant Adam Rothstein asserting claims of fraudulent misrepresentation, violations of the
Kansas Consumer Protection Act and defamation arising out of a $210,000 short-term loan
made by Mr. Rothstein to Mr. Ross. Mr. Rothstein removed the petition to federal court on the
basis of diversity jurisdiction and, thereafter, asserted numerous counterclaims against Mr. Ross
arising out of Mr. Ross’s alleged breach of various agreements related to the loan.
At the onset of discovery, Mr. Rothstein filed a motion for summary judgment on each
of Mr. Ross’s claims for relief. In September 2013, the court granted summary judgment in
favor of Mr. Rothstein on Mr. Ross’s fraud and KCPA claims and granted in part and denied in
part summary judgment on Mr. Ross’s defamation claim.

After the filing of the court’s

memorandum and order resolving Mr. Rothstein’s motion for summary judgment, discovery
commenced in full force and triggered Mr. Rothstein’s second motion for summary judgment on
Mr. Ross’s defamation claim, which the court granted. This matter is now before the court on

Mr. Ross’s motion pursuant to Federal Rule of Civil Procedure 56(h) in which he contends that
Mr. Rothstein, in support of his first motion for summary judgment on the defamation claim,
submitted a false declaration from Stephen Gans. The motion is denied.
In resolving Mr. Ross’s motion, the court assumes familiarity with previous orders in this
case and the parties’ factual showing on summary judgment. Mr. Ross’s motion relates to that
portion of the court’s initial summary judgment ruling in which the court granted summary
judgment in favor of Mr. Rothstein on Mr. Ross’s defamation claim to the extent Mr. Ross
claimed that Mr. Rothstein had made defamatory statements to Steve Gans. The court granted
summary judgment in favor of Mr. Rothstein because Mr. Gans averred that he reviewed the
specific allegations in Mr. Ross’s affidavit concerning the alleged defamatory statements; he
specifically denied that Mr. Rothstein ever made those specific statements to him; and Mr.
Rothstein offered only inadmissible hearsay in response to that evidence.
In his motion to strike Mr. Gans’ affidavit under Rule 56(h), Mr. Ross contends that
subsequent discovery confirms that Mr. Gans’ declaration was false and that Mr. Rothstein, in
two e-mail communications to Mr. Gans, makes defamatory statements to Mr. Gans about Mr.
Rothstein. Putting aside the fact that Mr. Rothstein had these e-mail communications in his
possession at the time he responded to Mr. Rothstein’s first motion for summary judgment such
that this argument could have been made months ago, Mr. Rothstein has not satisfied the court
that Mr. Gans’ declaration was submitted in bad faith for purposes of Rule 56(h). In the first
round of summary judgment submissions, Mr. Ross submitted an affidavit specifically asserting
that Mr. Rothstein told Mr. Gans that Mr. Ross was being “sued all over town;” that he was
“broke;” that Infinity could not survive under Mr. Ross’s management; that Mr. Rothstein was
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“going to sue” Mr. Ross; and that Infinity’s prospects in Nicaragua were “nil.”

In his

declaration, Mr. Gans stated that he had reviewed the specific statements in Mr. Ross’s affidavit
and that Mr. Rothstein had never made those statements to him. The e-mail communications
from Mr. Rothstein to Mr. Gans in no way demonstrate that Mr. Gans’ declaration was false as
those e-mails do not contain any of the statements specifically asserted by Mr. Rothstein in his
affidavit and specifically refuted by Mr. Gans in his declaration. Even viewing the content of
the e-mails in the light most favorable to Mr. Ross, the e-mails cannot reasonably be construed
as making the statements alleged by Mr. Ross in his affidavit and refuted by Mr. Gans. The
motion, then, is denied.

IT IS THEREFORE ORDERED BY THE COURT THAT plaintiff Stanton E. Ross’s
motion under Federal Rule of Civil Procedure 54(h) for order striking declaration of Stephen
Gans (doc. 208) is denied.

IT IS SO ORDERED.

Dated this 30th day of May, 2014, at Kansas City, Kansas.

s/ John W. Lungstrum
John W. Lungstrum
United States District Judge

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