In Re Forfeiture Order of Tim Leissner
Case 1:23-mc-01505-MKB-JRC
UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK
March 19, 2025
MARGO K. BRODIE, United States District Judge
MEMORANDUM & ORDER
Tim Leissner pleaded guilty in 2018 to one count of conspiracy to violate the Foreign Corrupt Practices Act (“FCPA”) in violation of
On August 19, 2024, another Petitioner, Russell Simmons (“Simmons”),2 moved to dismiss the Lee Petition under
I. Background
a. Factual background
On August 28, 2018, Leissner pleaded guilty to one count of conspiracy to violate the FCPA, in violation of
Simmons formed Nu Horizons in 2011 and became its sole member and manager. (Lee’s Pet. ¶ 5.) On January 1, 2016, Simmons and Leissner executed the Nu Horizons Operating Agreement, which sets forth the ownership structure of the LLC, and states that Leissner and
On January 3, 2017, Nu Horizons purchased $1,300,000 worth of shares from Celsius, consisting of 433,333.33 shares at $3.00 per share. (Lee’s Pet. ¶ 10; Celsius Subscription Agmt., annexed to Lee’s Pet. as Ex. 2, Docket Entry No. 3-3.) In connection with this purchase, on January 26, 2017, Lee wired $1,000,000 of the total $1,300,000 to Celsius directly from a personal bank account (the “BofA Account”). (Lee’s Pet. ¶¶ 10–11; Wire Instructions and Confirmation, annexed to Lee’s Pet. as Ex. 3, Docket Entry No. 3-4.) Lee states that the BofA Account was opened solely in her name, no one else had access to or signing authority for the Account, and the Account was only ever funded with her own personal funds. (Lee’s Pet. ¶¶ 6–9.) Lee states that “[a]lthough [she] purchased the Celsius [S]hares with her separate funds, those shares were placed in Nu Horizons as an investment vehicle. . . . [B]ased on Leissner’s promise that Lee would get the benefit of Nu Horizons’ previously acquired shares of Celsius . . . , which would be blended with Lee’s contribution.” (Id. ¶ 12.) Lee alleges that she engaged in this investment with the understanding that blending the contributions would give her the benefit of a “blended average share price” of $1.12 per share as opposed to the $3.00 per share for which she purchased the shares on January 26, 2017. (Id. ¶¶ 12, 14.)
On July 11, 2018, 3,972,659 shares of Celsius stock were transferred to Lee’s personal brokerage account from Nu Horizons. (Lee’s Pet. ¶¶ 17, 28.)
b. Procedural background
On November 1, 2018, the Court entered a Preliminary Order of Forfeiture against Leissner that provided for a forfeiture money judgment in the amount of $43.7 million, pursuant to
On May 5, 2023, Lee filed a petition seeking to contest the forfeiture of the Celsius Shares. (Lee’s Pet.) On August 19, 2024, Simmons moved to dismiss the Lee Petition pursuant
In the October 2024 Decision, the Court granted Simmons’ motion to dismiss Lee’s claim. (Oct. 2024 Decision); Leissner, 2024 WL 4424201 at *7. In granting the motion, the Court held that Lee did not have standing to assert a direct claim because (1) her petition indicated that she was an investor in, or creditor to, Nu Horizons rather than a direct purchaser of the Celsius Shares, (2) her alleged beneficial interest in Nu Horizons did not establish a legal interest in Nu Horizons’ assets, and (3) she did not allege sufficient facts that legal ownership of the Celsius Shares was transferred to her in July of 2018. (Oct. 2024 Decision 9–11); Leissner, 2024 WL 4424201, at *3–6. The Court granted Lee leave to amend her petition. (Oct. 2024 Decision 12–15); Leissner, 2024 WL 4424201, at *6–7.
On October 15, 2024, Lee filed her amended petition.7 (Lee’s Am. Pet.) On October 21, 2024, Simmons moved for reconsideration of the October 2024 Decision, and, in the alternative,
II. Discussion
a. Standard of review
The standard for granting a motion for reconsideration “is strict, and reconsideration will generally be denied unless the moving party can point to controlling decisions or data that the court overlooked — matters, in other words, that might reasonably be expected to alter the conclusion reached by the court.” Commerzbank AG v. U.S. Bank, N.A., 100 F.4th 362, 377 (2d Cir. 2024) (quoting Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir. 1995)); Van Buskirk v. United Grp. of Cos., Inc., 935 F.3d 49, 54 (2d Cir. 2019) (same); In re Richardson Foods, Inc., --- B.R. ---, ---, 2025 WL 409914, at *7 (Bankr. S.D.N.Y. Feb. 6, 2025) (same); see also S.D.N.Y. & E.D.N.Y. Local Civ. R. 6.3 (providing that the moving party must “set[] forth concisely the matters or controlling decisions which counsel believes the [c]ourt has overlooked”). “Controlling decisions include decisions from the United States Court of Appeals for the Second Circuit; they do not include decisions from other circuits or district courts . . . .” Pentacon BV v. Vanderhaegen, No. 23-CV-2172, 2024 WL 3835334, at *12 (S.D.N.Y. Aug. 15, 2024) (quoting Cobalt Multifamily Invs. I, LLC v. Shapiro, No. 06-CV-6468, 2009 WL 4408207, at *2 (S.D.N.Y. Dec. 1, 2009)); see also Tenemille v. Town of Ramapo, No. 18-CV-724, 2022 WL 2047819, at *5 (S.D.N.Y. June 7, 2022) (quoting same). In addition to considering any evidence or controlling cases the court overlooked, the court should also consider whether there has been “an intervening change of controlling law.” Commerzbank AG, 100 F.4th at 377 (quoting Virgin Atl. Airways, Ltd. v. Nat’l Mediation Bd., 956 F.2d 1245, 1255 (2d Cir. 1992)); Ethridge v. Bell, 49 F.4th 674, 688 (2d Cir. 2022) (quoting Kolel Beth Yechiel Mechil of Tartikov, Inc. v. YLL Irrevocable Tr., 729 F.3d 99, 104 (2d Cir. 2013)); In re Kaspar, --- B.R. ---, ---, 2025 WL 816661, at *16 (Bankr. S.D.N.Y. Feb. 18, 2025) (quoting In re Hellas Telecomms. (Luxembourg) II SCA, 555 B.R. 323, 343 (Bankr. S.D.N.Y. 2016)); Johnson v. Mount Sinai Hosp. Grp., Inc., No. 22-CV-2936, 2023 WL 3159233, at *1 (E.D.N.Y. Apr. 28, 2023) (quoting Kolel Beth Yechiel Mechil of Tartikov, Inc. v. YLL Irrevocable Tr., 729 F.3d 99, 104 (2d Cir. 2013)).
It is thus well-settled that a motion for reconsideration “is not a vehicle for relitigating old issues, presenting the case under new theories, securing a rehearing on the merits, or otherwise taking [another] bite at the apple.” U.S. for Use & Benefit of Five Star Elec. Corp. v. Liberty Mut. Ins. Co., 758 F. App’x 97, 101 (2d Cir. 2018) (alteration in original) (quoting Analytical Survs., Inc. v. Tonga Partners, L.P., 684 F.3d 36, 52 (2d Cir. 2012), as amended, (July 13, 2012)). “A motion for reconsideration is not an opportunity for a [party] to ‘relitigate an issue already decided’ or present arguments that could have been made before the judgment was entered.” Ethridge, 49 F.4th at 688 (quoting Shrader, 70 F.3d at 257); see also Doe v. Martucci, No. 20-CV-2331, 2024 WL 5118505, at *2 (S.D.N.Y. Dec. 16, 2024) (“[A] motion for reconsideration is neither an occasion for repeating old arguments previously rejected nor an opportunity for making new arguments that could have been previously advanced.” (quoting Assoc. Press v. U.S. Dep’t of Def., 395 F. Supp. 2d 17, 19 (S.D.N.Y. 2005))); Salveson v. JP Morgan Chase & Co., 166 F. Supp. 3d 242, 248 (E.D.N.Y. 2016) (“A motion for reconsideration is ‘neither an occasion for repeating old arguments previously rejected nor an opportunity for making new arguments that could have previously been made.’” (quoting Simon v. Smith & Nephew, Inc., 18 F. Supp. 3d 423, 425 (S.D.N.Y. 2014))), aff’d, 663 F. App’x 71 (2d Cir. 2016).
i. Simmons’ motion for reconsideration is moot
Lee argues that the Court should deny Simmons’ motion for reconsideration because the filing of her amended petition “renders moot the decision permitting it,” and that Simmons’ “motion attempts to litigate the merits of [the] Lee[] Amended Petition,” rather than “argue the Court was wrong in the first instance.” (Lee’s Opp’n 3–4.)
Simmons argues that his reconsideration motion is proper because “a district court has the inherent power to reconsider and modify its interlocutory orders prior to the entry of judgment,” and because reconsideration is appropriate where the party “‘has made misrepresentations to the Court’ in order to obtain an interlocutory order.” (Simmons’ Reply 1 (first quoting United States v. LoRusso, 695 F.2d 45, 33 (2d Cir. 1982); then quoting Bridgeforth v. Mckeon, No. 09-CV-6162, 2012 WL 3962378, at *2 (W.D.N.Y. Sept 10, 2012)).)
“It is well established that an amended complaint ordinarily supersedes the original, and renders it of no legal effect.” See Shields v. Citytrust Bancorp, Inc., 25 F.3d 1124, 1128 (2d Cir. 1994) (quoting Int’l Controls Corp. v. Vesco, 556 F.2d 665, 668 (2d Cir. 1977) (collecting cases); Meserole v. Sony Corp. of Am., No. 08-CV-8987, 2009 WL 2001451, at *1 (S.D.N.Y. July 9, 2009) (denying plaintiffs’ motion for reconsideration where the court gave plaintiffs leave to replead their claims and plaintiffs filed a timely second amended complaint); see also Mintz v. Baron, No. 05-CV-4904, 2009 WL 735140, at *1 (S.D.N.Y. Mar. 20, 2009) (granting a request to consolidate a motion for reconsideration and motion to dismiss “[b]ecause the subsequently filed [a]mended [c]omplaint moots reconsideration of the first motion to dismiss” and raises arguments “similar to those in the motion to dismiss”).
ii. Simmons has not identified any controlling precedent or evidence overlooked by the Court
Simmons argues that the Court’s futility determination did not consider the fact that the July 2018 SPA is “insufficient on its face to establish Ms. Lee’s purported purchase of the [Celsius] [S]hares from Nu Horizons constituted a bona fide purchase for value.” (Simmons’ Mem. 3–4.) First, Simmons argues that an amendment of Lee’s Petition is futile because the July 2018 SPA was “not an arm’s-length transaction.” (Id. at 4.) Second, Simmons argues that an amendment is futile because he can find “no evidence that All Def Media, LLC . . . is an entity organized under the laws of any jurisdiction” and therefore the consideration for the July 2018 SPA was insufficient to constitute a bona fide purchase for value. (Id. at 4–5.) Simmons also argues that Lee’s allegation that she purchased all of Nu Horizons through Keyway Pride is futile because the document on which Lee bases her authority for the purchase — the Keyway Pride Operating Agreement — is a forgery. (Id. at 5.) In support, Simmons argues that Keyway Pride has alleged the operating agreement is a forgery in ongoing litigation in California state court. (Id. at 6.) Simmons also argues that, even if the agreement is not a forgery, the document does not authorize either Leissner or Lee to act on Keyway Pride’s behalf. (Id. at 6–7.)
Lee argues that the Court should deny Simmons’ motion for reconsideration. (Lee’s Opp’n 3.) First, Lee argues that Simmons’ motion improperly raises two new arguments (1) that the consideration for the July 2018 SPA was insufficient, and (2) that the May 2018 STA was
c. The Court finds no good cause to order discovery into the July 2018 SPA or the Keyway Pride Operating Agreement
Simmons requests that in the event the Court denies his motion for reconsideration, the Court direct the parties to engage in discovery regarding the July 2018 SPA and Keyway Pride Operating Agreement. (Simmons’ Mem. 8.) Simmons contends there is good cause for expedited discovery into the July 2018 SPA and Keyway Pride Operating Agreement because Lee can only state a claim that she made a bona fide purchase for value of the Celsius Shares through the July 2018 SPA and because Lee appears to rely on a non-existent company and forged operating agreement in the Lee Amended Petition. (Id. at 8.) In support of his request for expedited discovery, Simmons attached an affidavit from his attorney regarding a California state court lawsuit where Keyway Pride alleges that Leissner entered into an agreement without its authority to sell a Beverly Hills mansion. (Decl. of Jeffrey Alberts (“Alberts Decl.”) ¶¶ 1–5, annexed to Simmons’ Mem., Docket Entry No. 91-1.)
Because Simmons has neither cited controlling authority sufficient to meet the standard for reconsideration of the October 2024 Decision nor pointed to any evidence overlooked by the Court, the Court declines to order additional discovery at this time. The Court found that “[n]one of Lee’s theories of direct ownership establish standing sufficient for her to assert a direct claim to the Celsius Shares.” (Oct. 2024 Decision 8); Leissner, 2024 WL 4424201, at *4. However, based on Lee’s claim that Nu Horizons sold the Celsius Shares to her in exchange for shares in of All Def Media, LLC, as well as $100, (Lee’s Opp’n to Simmons’ Mot. to Dismiss 3 n.2, Docket Entry No. 74; Lee’s Am. Pet. ¶¶ 17–23), the Court did not err in allowing Lee to amend her petition to include this fact and other details supporting her theory that the July 2018 SPA gave her legal ownership of the Celsius Shares. See United States v. Daugerdas, 892 F.3d 545, 553 (2d Cir. 2018) (permitting the petitioner to amend her petition to plead additional facts because,
III. Conclusion
For the reasons discussed above, the Court denies Simmons’ motion for reconsideration and his request for additional expedited discovery.
Dated: March 19, 2025
Brooklyn, New York
SO ORDERED:
s/ MKB
MARGO K. BRODIE
United States District Judge