Johannsen et al v. Morgan Stanley Credit Corportion et al

Filing 36

ORDER signed by Judge Morrison C. England, Jr on 4/10/12 DENYING 27 Motion for Reconsideration and all respective requests for sanctions. Pltf shall file appropriate documents to commence arbitration by 4/17/12. (Manzer, C)

1
2
3
4
5
6
7
8
UNITED STATES DISTRICT COURT
9
EASTERN DISTRICT OF CALIFORNIA
10
11
12
13
14

JOANNE JOHANNSEN, individually
and as TRUSTEES of The JOHANNSEN
FAMILY TRUST Dated October 18,
1988, and The JOHANNSEN FAMILY
SURVIVORS TRUST Dated
October 18, 1988,

15
16
17

No. 2:11-cv-01516-MCE-KJN

Plaintiff,
ORDER

v.

23

MORGAN STANLEY CREDIT
CORPORATION, a Delaware
corporation; MORGAN STANLEY
DW, INC., a Delaware
corporation; MORGAN STANLEY
SMITH BARNEY GLOBAL IMPACT
FUNDING TRUST, INC., a
Maryland corporation; MORGAN
STANLEY HOME LOANS, a business
association; MORGAN STANLEY
SMITH BARNEY, a business
association; DOES 1-100,
Inclusive,

24

Defendants.

18
19
20
21
22

25
26
27

----oo0oo----

28
1

1

On January 11, 2012, this Court issued its Memorandum and

2

Order (Docket No. 726) which granted Defendant’s Motion to Compel

3

arbitration (ECF No. 8) and ordered Plaintiff to submit her

4

claims in this matter to arbitration, under the auspices of the

5

Financial Regulatory Authority, Inc. (“FINRA”) within thirty (30)

6

days.

7

reconsider its order compelling arbitration.

Now before the Court is Plaintiff’s request that the Court

8

A court should not revisit its own decisions unless

9

extraordinary circumstances show that its prior decision was

10

wrong.

Christianson v. Colt Indus. Operating Corp., 486 U.S.

11

800, 816, 108 S. Ct. 2166 (1988).

12

appropriate if the district court 1) is presented with newly

13

discovered evidence; 2) has committed clear error or issued an

14

initial decision that was manifestly unjust; or 3) is presented

15

with an intervening change in controlling law.

16

Burlington N. Santa Fe R.R. Co., 338 F.3d 1058, 1063 (9th Cir.

17

2003); School Dist. No. 1J, Multnomah County v. ACandS, Inc., 5

18

F.3d 1255, 1263 (9th Cir. 1993)(citations and quotations

19

omitted).

20

reconsideration to demonstrate “what new or different facts or

21

circumstances are claimed to exist which did not exist or were

22

not shown upon such prior motion, or what other grounds exist for

23

the motion,” and “why the facts or circumstances were not shown

24

at the time of the prior motion.”

25

///

26

///

27

///

28

///

Reconsideration may be

See Turner v.

Local Rule 230(j) similarly requires a party seeking

2

1

“Motions for reconsideration serve a limited function: to

2

correct manifest errors of law or fact or to present newly

3

discovered evidence.”

4

2d 1070, 1098 (E.D. Cal. 2006) (emphasis in original) (internal

5

citations omitted).

6

or belief that the court is wrong in its decision, are

7

accordingly not sufficient.

8

addressed to the sound discretion of the district court.

9

v. Burlington N. Santa Fe R.R., supra, 338 F.3d at 1063.

Ayala v. KC Envtl. Health, 426 F. Supp.

Mere dissatisfaction with the court’s order,

Reconsideration requests are
Turner

10

Plaintiff brought this motion on grounds that once she

11

attempted to comply with the Court’s order and contact FINRA for

12

purposes of scheduling arbitration, she was informed that Morgan

13

Stanley’s FINRA membership had been terminated, and that

14

therefore Morgan Stanley could not compel her to submit the

15

instant controversy to arbitration before FINRA.

16

letter to that effect from FINRA indicating that “[t]he Code of

17

Arbitration Procedure prohibits any FINRA member whose membership

18

is terminated... from enforcing predispute arbitration agreements

19

with its customers to arbitrate at FINRA, unless the customers

20

agree in writing to do so after the claim has arisen.”

21

letter dated March 13, 2012, attached as Exh. 1 to the

22

Supplemental Decl. of David L. Price.

23

information represents newly discovered evidence plainly germane

24

to the Court’s decision, and arguing that she does not wish to

25

submit her claims to arbitration, Plaintiff asks that the Court

26

revisit its decision accordingly.

27

///

28

///
3

She points to a

FINRA

Arguing that this

1

She goes on to contend sanctions against Morgan Stanley are

2

appropriate because the company should have known about its

3

lapsed status with FINRA all along, but nonetheless forced

4

Plaintiff to incur substantial costs and delays in opposing an

5

unsustainable motion to compel.1

6

Morgan Stanley, for its part, indicates that a careful

7

reading of FINRA’s letter indicates that it only pertains to

8

Morgan Stanley, DW, Inc., an organization that no longer existed

9

given its 2007 merger into Morgan Stanley & Co.

Like Plaintiff,

10

Morgan Stanley also requests sanctions, in its case for having to

11

oppose Plaintiff’s motion.

12

disclosed that merger in previous filings, and that therefore the

13

motion for reconsideration is plainly lacking.

14

points out, there is, in fact, distinguishing language in the

15

March 13, 2012 FINRA letter to the effect that if Plaintiff “does

16

want to proceed against any remaining respondents, the claimant

17

must submit a revised Submission Agreement and Amended Statement

18

of Claim identifying only the appropriate parties and the

19

allegations and damages against each named party on or before

20

April 17, 2012.”

Morgan Stanley argues that it had

As Morgan Stanley

Id. at p. 2.

21

Plaintiff’s submission papers to FINRA do include Morgan

22

Stanley & Co., Inc. as well as Morgan Stanley Credit Corporation,

23

Morgan Stanley Home Loans, Morgan Stanley Smith Barney Global

24

Impact Funding Trust, Inc. and Morgan

25

Stanley Smith Barney, LLC.

26

///

27
28

1

As detailed in Plaintiff’s reply papers, Plaintiff
subsequently dropped its sanctions request in this matter.
4

1

Morgan Stanley DW, Inc. itself is only listed as an “aka” for

2

Morgan Stanley & Co., Inc., a designation which arguably reflects

3

Morgan Stanley DW’s prior status.

4

Consequently, in the Court’s view, FINRA’s letter is less

5

than a model of clarity, especially given Plaintiff’s

6

comprehensive arbitration request.

7

appears to have been properly designated, so the Court can

8

appreciate Plaintiff’s confusion upon receipt of the letter even

9

though the letter does mention the fact that Plaintiff may still

10
11

Morgan Stanley DW, Inc.

proceed against the other Morgan Stanley entities.
Nonetheless, as indicated above a careful reading of the

12

letter does indicate that Plaintiff can still proceed under the

13

auspices of FINRA against the active Morgan Stanley companies,

14

and consequently there are no new facts here which would justify

15

reconsideration at this juncture.

16

Reconsideration (ECF No. 27) is accordingly DENIED.2

17

parties’ respective requests for sanctions are also DENIED.

18

Plaintiff is directed to file the appropriate documents as

19

requested by FINRA to commence arbitration not later than April

20

17, 2012.

21

Plaintiff’s Motion for
The

IT IS SO ORDERED.

22 Dated: April 10, 2012
23

_______________________________________
MORRISON C. ENGLAND, JR.
UNITED STATES DISTRICT JUDGE

24
25
26
27
28

2

Because oral argument was not of material assistance, the
Court ordered this matter submitted on the briefs in accordance
with E.D. Local Rule 230(g).
5