Sussmann et al v. Financial Guards, LLC et al
ORDER AND REASONS denying 45 Motion for Relief from Judgment; denying 46 Motion for Reconsideration. Signed by Judge Jane Triche Milazzo. (ecm)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
EDDIE SUSSMAN, SR. ET AL.
FINANCIAL GUARDS, LLC ET AL.
ORDER AND REASONS
Before the Court are Defendant Daniel Dragan’s Motion for Relief from
Judgment (Doc. 45) and Motion for Reconsideration (Doc. 46).
following reasons, the Motions are DENIED.
Plaintiffs Eddie Sussmann, Sr. and Leading Edge Financial Services
LLC (“Leading Edge”) brought this action against former employee Daniel
Dragan (“Dragan”) and his company, Financial Guards, LLC (“Financial
Guards”). In their Complaint, Plaintiffs allege that Dragan worked as an
independent contractor managing IT and marketing for Leading Edge for
many years before he was terminated on May 15, 2015. They allege that
shortly after his termination, Dragan formed Defendant Financial Guards.
Plaintiffs allege that Defendants then converted Plaintiffs’ assets and
confidential information and refused to return them. Plaintiffs allege that,
among other things, Defendants used the converted property to create websites
and alter an existing website, lifeguy.com, with the intention of confusing
customers of Leading Edge and attracting customers to Financial Guards.
Plaintiffs filed an Amended Complaint on August 21, 2015 and served
After Defendant Financial Guards failed to answer or
otherwise make an appearance in this matter, Plaintiffs moved for the entry of
default and a default judgment, which this Court granted on July 21, 2016. In
doing so, the Court found that it had personal and subject matter jurisdiction
over Financial Guards and that Plaintiffs had pleaded allegations against it
under the Computer Fraud and Abuse Act, the Lanham Act, the Louisiana
Unfair Trade Practices Act, the Louisiana Uniform Trade Secrets Act, and
state law conversion. The Court entered a permanent injunction at Plaintiffs’
request, stating that:
1. Financial Guards, LLC is hereby enjoined from utilizing
Plaintiffs’ trade secrets or other confidential and proprietary
information; enjoined from accessing Plaintiffs’ website
platforms, email systems, and telephone systems; ordered to
return any and all trade secrets, property, and information
belonging to Plaintiffs in their possession, custody, or control,
including all login credentials and passwords to any database,
web portal, or web domain belonging to Plaintiffs; and ordered
to delete and destroy any and all copies of confidential and
proprietary information belonging to Plaintiffs, including, but
not limited to, files maintained on any computer, drive, or email account in their possession or to which they have access or
over which they have control, whether in hard copy or in
2. Financial Guards, LLC, together with its officers, directors,
agents, partners, employees and related companies, and all
persons acting in concert with them, are enjoined from copying,
reproducing, distributing, advertising, promoting, or displaying
the infringing website and content described in the Complaint
and First Amended Complaint;
3. Financial Guards, LLC, together with its officers, directors,
agents, partners, employees and related companies, and all
persons acting in concert with them, are ordered to destroy all
materials or articles infringing Leading Edge Financial’s trade
On September 13, 2016, Defendant Dragan filed two motions for relief
from this judgment. In his first motion, he seeks relief under Federal Rule of
Civil Procedure 60(b), arguing that the Court’s judgment is based on a
fraudulent misrepresentation of facts and limits the use of his personal
property. In his second motion, Plaintiff seeks relief under Federal Rule of
Civil Procedure 59(e), setting forth the same arguments. 1 This Court will
consider each motion in turn.
Under Federal Rule of Civil Procedure 59(e), a party may file a Motion
to Alter or Amend a Judgment within 28 days of the entry of the judgment.
Under Federal Rule of Civil Procedure Rule 60(b), a Motion for Relief from
Judgment may be considered outside of this time period. While the scope of
Rule 59(e) is unbounded, “Rule 60(b) relief may be invoked . . . only for the
causes specifically stated in the rule.” 2 Pursuant to Rule 60, there are six
reasons for which this Court is authorized to grant relief from final judgment:
(1) mistake, inadvertence, surprise, or excusable neglect;
(2) newly discovered evidence that, with reasonable diligence, could not
have been discovered in time to move for a new trial under Rule 59(b);
misrepresentation, or misconduct by an opposing party;
(4) the judgment is void;
Plaintiff’s motion erroneously refers to Rule 59(a), which applies only to matters that
have been decided at trial.
2 Williams v. Thaler, 602 F.3d 291, 303 (5th Cir. 2012) (alteration in original) (internal
citations and quotation marks omitted).
(5) the judgment has been satisfied, released or discharged; it is based
on an earlier judgment that has been reversed or vacated; or applying it
prospectively is no longer equitable; or
(6) any other reason that justifies relief.
“Rule 60(b)(6) has been described as a “residual clause used to cover
unforeseen contingencies,” and as “a means for accomplishing justice in
exceptional circumstances.” 3
Rule 59(e) serves the narrow purpose of correcting “‘manifest error[s] of
law or fact or . . . presenting newly discovered evidence.’” 4 “‘Manifest error’ is
one that ‘is plain and indisputable, and that amounts to a complete disregard
of the controlling law.’” 5 A Rule 59(e) motion “[i]s not the proper vehicle for
rehashing evidence, legal theories, or arguments that could have been offered
or raised before the entry of judgment.” 6
In the Fifth Circuit, altering,
amending, or reconsidering a judgment under Rule 59(e) “[i]s an extraordinary
remedy that should be used sparingly.” 7
While district courts have
“considerable discretion in deciding whether to grant or deny a motion to alter
a judgment,” denial is favored. 8
Shoemaker v. Estis Well Serv., L.L.C., No. 14-163, 2015 WL 4875467, at *13 (E.D.
La. Aug. 12, 2015).
4 Advocare Int’l, LP v. Horizon Labs., Inc., 524 F.3d 679, 691 (5th Cir. 2008) (quoting
Rosenzweig v. Azurix Corp., 332 F.3d 854, 863 (5th Cir. 2003)).
5 Guy v. Crown Equip. Corp., 394 F.3d 320, 325 (5th Cir. 2004) (quoting Venegas–
Hernandez v. Sonolux Records, 370 F.3d 183, 195 (1st Cir. 2004)).
6 Templet v. HydroChem, Inc., 367 F.3d 473, 479 (5th Cir. 2004) (citing Simon v.
United States, 891 F.2d 1154, 1159 (5th Cir. 1990)).
7 Id. (citations omitted).
8 Hale v. Townley, 45 F.3d 914, 921 (5th Cir. 1995).
LAW & ANALYSIS
A. Motion for Relief Pursuant to Rule 59(e)
Motions filed under Rule 59(e) must be filed within 28 days of the judgment
from which a party seeks relief. In this case, the Court ordered that Plaintiffs
are entitled to a default judgment against Financial Guards on July 21, 2016.
Defendant Dragan filed his Motion for Reconsideration on September 13,
2016—outside of 28 days.
Accordingly, Defendant’s Rule 59 Motion is
B. Motion for Relief Pursuant to Rule 60(b)
In his Motion for Relief from Judgment pursuant to Rule 60(b), Defendant
Dragan brings two arguments. First, he alleges that the Court’s prior order
was based on fraudulent misrepresentations of fact made in Plaintiffs’
Second, he argues that the injunction issued by the Court
inadvertently prevents him from using his personal property, specifically the
website domain, lifeguy.com. This Court will consider each argument in turn.
Defendant’s first argument is unavailing.
By virtue of the entry of
default, Plaintiffs’ well-pleaded allegations of fact are deemed admitted, and
this Court must accept them as true. 9
Accordingly, in light of the legal
standard that this Court is required to apply, Defendant’s assertions that the
facts of Plaintiffs’ Complaint are false does not alter its decision.
In Defendant’s second argument, he alleges that he is the owner of the
domain name and website lifeguy.com and that the permanent injunction
issued by this Court, which prevents officers, directors, agents, partners, and
employees of Financial Guards from “copying, reproducing, distributing,
advertising, promoting, or displaying the infringing website and content,” has
Nishimatsu Const. Co., Ltd. V. Houston Nat’l. Bank, 515 F.2d 1200, 1206 (5th Cir.
prevented him from using his personal property. He alleges that he purchased
the website domain name in 2011, long before the formation of Financial
Guards in 2015. Defendant Dragan asks this Court to remove him from the
effects of the preliminary injunction against Financial Guards.
Plaintiffs’ Complaint, however, does not specify the owner of lifeguy.com;
it merely alleges that Defendants used the site to confuse Plaintiffs’ customers
into thinking that the site is associated with Plaintiffs’ business. Accepting
these allegations as true as it must, this Court held that Plaintiffs had pleaded
claims against Financial Guards that entitled them to a default judgment
against it. 10 The injunction entered by this Court merely precludes “Financial
Guards, LLC, together with its officers, directors, agents, partners, employees
and related companies, and all persons acting in concert with them” from
“copying, reproducing, distributing, advertising, promoting, or displaying”
lifeguy.com. The injunction does not prevent Defendant Dragan from utilizing
the site in his personal capacity, separate and apart from Financial Guards.
Accordingly, the relief requested by this Motion is unnecessary and therefore
The Court also specifically notes that it is clear from the record that Dragan was well aware of the
suit against Financial Guards and of the necessity of obtaining an attorney to answer on Financial
Guard’s behalf. The Court previously struck a motion to dismiss filed by Dragan on Financial Guard’s
behalf, stating that a corporation may only appear in court through a licensed attorney. See Doc. 26.
Despite this, Dragan failed to obtain an attorney to answer on Financial Guard’s behalf and likewise
failed to oppose the entry of default or default judgment.
For the foregoing reasons, Defendant’s Motions are DENIED.
New Orleans, Louisiana this 18th day of January, 2017
JANE TRICHE MILAZZO
UNITED STATES DISTRICT JUDGE
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