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Tolvin v. Dougherty

United States District Court, D. New Jersey

July 16, 2019

ROBIN C. TOLVIN, Plaintiff,
JOSEPH J. DOUGHERTY, et al., Defendants.



         This matter comes before the Court upon the Court's review of Defendant Joseph J. Dougherty's ("Defendant")[1] Removal of Plaintiff Robin C. Tolvin's ("Plaintiff) Application for Temporary Injunctive Relief from the Superior Court of New Jersey, Chancery Division, Monmouth County. (Def.'s Notice of Removal, Ex. 1 C'OSC Documents'*), ECF No. 1 .)[2] On June 26, 2019, prior to removal, the Superior Court entered an Order to Show Cause as to why temporary restraints should not be entered. (OSC Documents 6-10.) Defendant subsequently removed the matter to this Court on the basis of diversity jurisdiction, 28 U.S.C. § 1332, stating that complete diversity exists and the amount in controversy exceeds $75, 000.[3] (Id. at 2-3 ¶¶ 6-11.)

         The Court has carefully considered Plaintiffs application and decides the matter without oral argument pursuant to Local Civil Rule 78.1. For the reasons set forth below, the Court denies Plaintiffs application for temporary restraints. The Court, however, orders the parties to submit a joint proposed expedited briefing schedule and perform expedited discovery to precede a preliminary injunction hearing.

         I. Background

         Plaintiffs Complaint provides the following factual allegations.[4] Defendant is Plaintiffs nephew. (OSC Documents 12-13¶*2, 7, ECF No. 1.) In September 2018, Defendant told Plaintiff he was leaving his job as an associate at Duval & Stachenfeld, LLP "to take a job as general counsel for REM Technology Consulting Services, Inc." ("REMTCS"). (Id. ¶ 9.) Defendant told Plaintiff that REMTCS would not pay Defendant a salary but instead would compensate Defendant based on the amount of new business he generated. (Id. ¶ 11.) Plaintiff loaned Defendant $300, 000 for living expenses to support Defendant while he attempted to bring in new business for REMTCS. (M¶¶ 13-16.)

         In November 2018, Defendant told Plaintiff "he had the opportunity to invest in REMTCS and that the minimum individual investment was $5, 000, 000." (Id. ¶ 17.) Defendant further told Plaintiff "she could invest $1, 600, 000 in REMTCS under the umbrella of his shares." (Id. ¶ 18.) Plaintiff learned that she could withdraw that sum from her JP Morgan Chase Bank, N.A. IRA accounts, but that those withdrawals would create "significant federal and New York State tax liability." (Id. ¶ 19.) Plaintiff notified Defendant of those tax liabilities, and Defendant told Plaintiff he "would take care of them. (Id. T 20.) Plaintiff, therefore, withdrew $1, 600, 000 from two IRA accounts and wired that sum from her JP Morgan Chase Bank, N.A. account to Defendant's bank account. (Id. ¶21.)

         Later, Plaintiff asked Mignone several times whether REMTCS's president, Richard Malinowski ("Malinowski"), was aware that she invested in his company, and Mignone stated that Malinowksi was aware of her investment. (See, e.g., Id. ¶¶ 29-34, S?.)[5] Defendant also confirmed with Plaintiff that she had invested in REMTCS and reiterated his agreement to pay Plaintiffs tax liability, (/rf. ¶¶ 37-39.)

         "As of April 15, 2019, Defendant... did not provide ... Plaintiff with any money to pay the tax liabilities that she had as a result of withdrawing $1, 600, 000 from her IRAs." (Id. ¶ 41.) Plaintiff owes $552, 658 in federal taxes and $199, 456 in New York State and City taxes. (Id. ¶¶ 43-44.) Defendant also has not repaid Plaintiff for her $300, 000 loan. (Id. ¶ 49.)[6] Plaintiffs instant application seeks an order temporarily restraining Defendant from withdrawing or releasing funds from any of Defendant's bank accounts, as well as requiring Defendant to provide Plaintiff with copies of his bank records and statements from September I, 2018 to the present. (PL's Moving Br. 40.)

         II. Legal Standard

         "The Supreme Court [has] held that [a] [TRO] should be treated as a preliminary injunction." NutraSweet Co. v. Vit-Mar Enters., Inc., ! 12 F.3d 689, 693 (3d Cir. 1997). Because the grant of injunctive relief is "an extraordinary remedy[, ]" a TRO "should be granted only in limited circumstances." Kos Pharms., Inc. v. Andrx Corp., 369 F.3d 700, 708 (3d Cir. 2004) (internal quotation marks and citation omitted). This remedy "should be granted only if "(1) the plaintiff is likely to succeed on the merits; (2) denial will result in irreparable harm to the plaintiff; (3) granting the injunction will not result in irreparable harm to the defendant; and (4) granting the injunction is in the public interest.'" NittraSweel Co. v. Vit-Mar Enters., Inc., 176 F.3d 151, 153 (3d Cir. 1999) (quoting Maldonado v. Hoitstoun, 157 F.3d 179, 184 (3d Cir. 1998)). The Third Circuit has further instructed that a party seeking a TRO must meet all four factors, because "[a] [movant's] failure to establish any element in its favor renders [this remedy] inappropriate." Id.

         III. Discussion

         Plaintiff argues that Defendant "stole so much money from her that she now faces financial ruin." (PL's Moving Br. 36.) As such, Plaintiff argues she requires immediate temporary injunctive relief to: (I) "stop [Defendant] from spending any more of her money before all of her money is gone"; and (2) "find out what [Defendant] did with her money so she can find any money that remains unspent and locate any assets [Defendant] purchased with her money that she can recover." (Id.)

         The Court finds Plaintiff failed to sufficiently establish immediate irreparable harm. Although Plaintiffs factual allegations are sympathetic, the Court cannot grant Plaintiff the extraordinary relief she seeks solely based upon monetary damages. Indeed, Plaintiff explicitly noted that "[t]he subject matter of this litigation is the money that [Plaintiff lost]" and "[i]f the Court does not grant the temporary injunctive relief that [Plaintiff] requests, there is the real risk that, if any of [Plaintiffs] money remains unspent, more of her money will be spent by [Defendant] and lost to [Plaintiff]." (Id. at 39.) Third Circuit precedent is clear, however, that "purely economic injury, compensable in money, cannot satisfy the irreparable injury requirement" when a plaintiff "has failed to articulate and adduce proof of actual or imminent harm which cannot otherwise be compensated by money damages ...." Frank \s GMC Truck Cir., Inc. v. Gen. Motors Corp., 847 F.2d 100, 102-03 (3d Cir. 1988) (citation and alteration omitted) ('"Although we are not insensitive to the financial distress suffered by the plaintiff, we do not believe that the loss of income alone constitutes irreparable harm."); see also Instant Air Freight Co. v. C.F. Air Freight, Inc., 882 F.2d 797, 801 n.7 (3d Cir. 1989) (noting that even under the Crowe v. DeGioia[7] standard, parties must demonstrate harm cannot be redressed by monetary damages under the irreparable harm prong); Reitly v. City of Harrisburg, 858 F.3d 173, 179 n.4 (3d Cir. 2017) (;i[T]he availability of money damages for an injury typically will preclude a finding of irreparable harm."). Here, Plaintiff fails to support her application with any allegations other than her economic injury, and therefore, the Court denies Plaintiffs application for temporary restraints.

         The Court, however, finds good cause to allow Plaintiff the opportunity to present her arguments at a preliminary injunction hearing. In advance of that hearing, the parties may conduct expedited discovery, and must ...

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