Ray Capital Inc et al v. M/V Newlead Castellano et al

Filing 128

ORDER granting in part and denying in part 118 Motion to Intervene; granting in part and denying in part 118 Motion for Reconsideration; denying as moot 121 Motion for Hearing. It is further ordered that Defendant's Counterclaim for wrong ful arrest is DISMISSED WITH PREJUDICE. The Clerk is DIRECTED to enter final judgment in favor of plaintiffs on their claims against Defendants. The Clerk is ORDERED to disburse the funds remaining in the registry of the Court in connection with this case in the manner and amounts described in this Order. The Clerk is directed to terminate all other pending motions, if any, and close this case. Signed by Chief Judge J. Randal Hall on 9/13/17. (loh)

IN THE UNITED
FOR THE

STATES DISTRICT COURT

SOUTHERN DISTRICT OF GEORGIA
SAVANNAH DIVISION
IN ADMIRALTY

RAY CAPITAL INC.;
LTD.;

OPPENHEIM

*

CHEYENNE HOLDINGS

CAPITAL LTD.;

*

and LABROY SHIPTRADE

*

LIMITED,

*

Plaintiffs,

*

v.

*

M/V NEWLEAD CASTELLANO, IMO NO.
9686338, her engines, tackle,
equipment, furniture,
appurtenances, etc., in rem,

416-093

*
*
*
*

and NEWLEAD CASTELLANO LTD.,

CV

*
*

Defendants.

*

ORDER

"Unless

sharks come," he

said aloud.

"If sharks come,

God pity him and me."1
On March
favor

of

20,

2017,

Plaintiffs

Order").

(See

Plaintiffs'

Doc.

favor,

the

Court

entered

summary judgment

against

Defendants

116.)

Before entering

however,

the

Court

(the

"Summary

Judgment

final judgment

ordered

in

Plaintiffs

in
to

"perfect the record with admissible evidence with regards to the
balance

of their

claims

against

Defendants

1 Ernest Hemingway, The Old Man and the Sea 68 (1952)

through

[March 20,

2017],
costs

including an itemization of
and

expenses

each

the principal,

Plaintiff

claims

under

interest,
its

instruments" by no later than March 30,

2017.

(Id.

Court

cause,

by

also

March 30,

against
this

ordered

2017,

as

Defendants

show

respective

at

The

later

no

17.)

than

to why their counterclaim for wrongful arrest

Plaintiffs

case

to

and

should

closed.

(Id.

not

at

be

dismissed

18.)

On March

with
21,

prejudice

2017,

and

Plaintiffs

filed a supplemental brief outlining the balance of their claims

against Defendants and evidence in support thereof.
On

March

("DHL")

30,

non-party

DHL

intervene

of

the

in the

grant

of

purports

summary

to

judgment

respond

to

I.

A.

Plaintiffs

the

Newlead

Plaintiffs

Holdings

Each

Doc.

Note

is

Chartering

Limited

renews its prior attempts

(ii)

in

seeks

favor

Court's

of

reconsideration

Plaintiffs;

order

to

show

and

cause

BACKGROUND

a

Underlying Claims

promissory

Ltd.

(each, a "Note") .

05/25/2016 Decl.,

18-4.)

hold

&

(Doc. 118.)

Plaintiffs'

each

(i)

present action;

directed towards Defendants.2

party

Project

filed a motion wherein it:

to

(iii)

2017,

(Doc. 117.)

28-2,

in

note

favor

executed

of

the

by

non

respective

(PSMF, Doc. 44, SI 1; Tsouvelekakis
SI 11;

secured

by

see also

a

Docs.

guarantee

18-1 through

and

indemnity

2 To date, Defendants themselves have failed to respond to the order to show
cause set forth in the Summary Judgment Order.

agreement

executed

subsidiary,

of

the

Defendant

respective

(PSMF 5 6; Doc.

mortgage
(the

by

Newlead

Holdings

Newlead Castellano

Plaintiff

18-5.)

Ltd.

creditor

Each Guaranty,

Ltd.'s

("NCL"),

(each,

in turn,

over Defendant M/V Newlead Castellano,

"Vessel")

executed

by

NCL

in

favor

Plaintiff creditor (each, a "Mortgage").3
see also Doc.

Newlead

wholly-owned

of

a

in

favor

"Guaranty").

was secured by a

IMO No.
the

9686338

respective

(PSMF SI 7; Doc. 18-6;

18-7.)

Holdings

Ltd.

subsequently

defaulted

on

Plaintiff

Ray Capital's Note by failing to tender payments due thereunder
by

the

maturity

date,

NCL's Guaranty.
Doc.

18-5,

notices

of

entities

SI

59-80,

default

cure

32;

with Answer,

to

Vessel's

Capital

their

a

SI

SIS! 53,

25;

timely

statements

to

Doc.

Ltd.

(PSMF 1 8; Doc.

18-7,

NCL,

Compl.

sent
these

within

Tsouvelekakis

on

SI 23;

having

and

the

05/25/2016
SIS!

53,

56,

NCL also breached the terms

(a)

allowing significant debt

Vessel;

(b)

failing

to

pay

manner;

(c)

failing

to

maintain

(d)

Plaintiffs

at 2.)

the

failing to provide audited
where

required;

3 Each Mortgage is registered with the Vessel's flag state,
Liberia.

call

15-1,

defaults

compare Am.

56.)

inter alia:
the

11;

to

Capital

respective

(PSMF SI

against

in

Ray

Holdings

Decl.

31,

Despite

insurance coverage on the Vessel;
financial

Ray

Newlead

period.

Doc.

crew

3.)

cure

Livanos

accumulate

SI
to

of the Mortgages by,
to

entitled

(PSMF SIS! 9-10; Livanos Decl.,

failed

requisite
Decl.

at

which

and

(e)

the Republic of

failing

to

maintain

(PSMF 5

13;

Vessel

in

a

complete

Swimmer 05/25/2016 Decl.,

Tsouvelekakis

05/25/2016

07/08/2016

Decl.,

Doc.

at

18-6,

the

Doc.

2-30,

Decl.

43-2,

64-93,

15

Doc.
M

6-7,

122-53,

28-1,

10-12

(PSMF SISl 15-24.)

Holdings

Ltd.

failure

defaults

and/or

NCL

Mortgages,

2016.4

NCL's

breaches

Plaintiffs

the

initiated the

1;

see

also

to

cure

failed

Based upon Newlead

cure

Notes,

instant

18-27;

their

respective

Guaranties,

and/or

action on April 19,

(Doc. 1.)

B.

On

under

to

repair.

Tsouvelekakis

& Ex.

157-85.)

of

SIS! 8-9,

37-38;

these additional breaches.

and

state

or

Shipping

about

S.A.

DHL's Underlying Claims

October

entered

27,

into

2011,

a

DHL

and

charter party

non-party

contract

Newlead

for

use of the non-party shipping vessel M/V Newlead Venetico
"Venetico").

(DHL

Project

& Chartering

Holdings Ltd., et al., Case No.
Action"),

the

Doc.

Venetico

Group Co.,

1,

to

Ltd.

SI 13.)

On December 8,

non-party

(the

4:16-CV-123

Zheijiang

"Sub-Charterer")

Limited

(S.D. Ga.)

2011,

a

(the

Newlead

(the "DHL

DHL sub-chartered

Materials

for

v.

DHL's

Industry

Fuel

shipment of cargo

4 Plaintiffs subsequently amended their complaint such that they now assert

the following claims against Defendants:. (1)

a foreclosure claim pursuant to

Ray Capital's promissory note and the Maritime Lien Act and the Ship Mortgage
Act, 46 U.S.C. § 31301, et seg. ("Act"); (2) a foreclosure claim pursuant to
Plaintiffs' preferred mortgages and the Act; (3) a foreclosure claim pursuant

to Plaintiff Ray Capital's payment of seamen's wages; and (4) a breach of
contract claim pursuant to Plaintiffs' preferred mortgages.
(See Doc. 18.)

from Australia to China.

(Id.

the

Sub-Charter's

cargo

the

Venetico

detained

Authority
Loading

was

due

to

onto

various

eventually

1 15.)
the

by

Venetico

the

alleged

resumed

on

Shortly after loading of

or

on

January

Australian

March

about

March

subsequently

5,

2012.

initiated

Sub-Charterer

alleged

(Id.)

DHL

arbitration
that

it

incurred

the delayed delivery of its cargo.
Action,

Action

Doc.

1-3.)

against

Newlead

Shipping

On

NCL

May

and

S.A.,

3,

2012,

Newlead

the

M

Kong,

18-19;

DHL

Bulkers

and

wherein

the

the

losses

from

see also DHL
the

Holdings

S.A.,

16.)

in China on

instituted

Newlead

St

Sub-Charterer

significant

2016,

non-parties

Plaintiffs'

Hong

(Id.

25,

Inc., and Newlead Venetico Ltd.5

C.

in

and

Safety

(Id.

Venetico commenced her voyage to the discharge port
or

2012,

Maritime

deficiencies.
about

4,

Grand

DHL

Ltd.,

Venetico

(DHL Action, Doc. 1.)

Arrest

and Attachment

& Interlocutory Sale of Vessel

Upon the filing of Plaintiffs'
19,

2016

in

this

case,

the

Court

verified complaint on April
entered

orders

directing

the

5 DHL's complaint in the DHL Action alleges: (1) a contingent breach of
contract claim against Newlead Shipping S.A., Newlead Bulkers S.A., and Grand
Venetico Inc.; and (2) an alter ego claim against Newlead Holdings Ltd. for
its alleged control of Newlead Shipping S.A., Newlead Bulkers S.A., Grand
Venetico Inc., Newlead Venetico Ltd., and NCL.
(DHL Action, Doc. 1, 11 2169.)
DHL states that its breach of contract claim "is based on an indemnity
claim for an arbitration award which may be issued against DHL in Hong Kong

arbitration.

Thereafter,

and/or Grand Venetico Inc.

DHL will pursue recovery against Newlead Shipping
in London.

[DHL] brings

[the DHL Action]

solely

to obtain quasi in rem jurisdiction over [the defendants in the DHL Action]
and security for its claims."

(Id. 1 71.)

issuance of a
maritime
Rules

attachment

and garnishment

(Docs.

Motion

to

which

1,

Vacate

Plaintiff's

NCL

wrongful

also

8,

an

Vessel,

but

Vessel;

and

sought

arrest.

entered

the

for the maritime arrest -

denied
the

15.)

Court

July

2016,

of

also

Plaintiffs'

May

and

3,

resulting

On

July

from

14,

Rule

Plaintiffs'
denied

2016,

attachment

Plaintiffs'

vacatur

related to
15,

arrest

vacating

for Admiralty or Maritime

On

damages

(Doc.

order

10.)

and process for

of the Vessel pursuant to

B & C of the Supplemental Rules

Claims.

in

warrant

filed

an

filed

the

this

C

Vessel

the

Court

of

the

attachment

request

for

(Doc.

a

allegedly

arrest
B

arrest of the Vessel.6

Plaintiffs

of

2016,

Rule

NCL's

NCL

of

damages

On

Motion

Emergency

47.)

for

Reconsideration seeking to reinstate their arrest of the Vessel,
while

Defendants

Reconsideration

subsequently

seeking

the

Vacate in its entirety.

Court

vacated

addressing the

that

arrest

grant

(Docs.

part

of

filed

49,

its

of

a

its

59.)

Order

Cross-Motion

original

On August 4,

dated

July

for

Motion
2016,

14,

to
the

2016

of the Vessel and reinstated Plaintiffs'

6 In vacating Plaintiff's arrest of the Vessel, the Court concluded that despite having demonstrated a valid prima facie admiralty claim with regard
to its action to foreclose on the Mortgages and therefore their entitlement
to attach the Vessel pursuant to Rule B - Plaintiffs had not demonstrated

that they held a maritime lien that would entitle them to arrest the Vessel
pursuant to Rule C(l)(a).
(Doc. 47, at 3-7.)
In denying NCL's request for
damages related to the arrest of the Vessel, the Court held that, inter alia,
NCL had "not shown that

wanton
(Id.

disregard

for

Plaintiffs acted in bad faith,

Defendants'

rights"

at 7-8.)
6

in

seeking

with malice,

arrest

under

or with

Rule

C

initial

arrest

of

the

Vessel.7

subsequently

sold

to

("Strategic")

via

proceeds

(i.e.,

non-party

interlocutory

being confirmed by this
the

(Doc.

Court

Vessel's

64.)

The

Strategic

admiralty

on August
substitute

Shipping,

sale,

16,

with

48,

65,

66,

68,

70,

that

2016 and the

res)

(the

being deposited in the registry of this Court.8'9
see also Docs.

Vessel

was
Inc.
sale

sales

"Proceeds")

(Docs. 73, 75;

79.)

7 In reinstating Plaintiffs' arrest of the Vessel, the Court noted that while
Plaintiffs still had not demonstrated that they held a maritime lien on the
Vessel, they had shown that they held preferred mortgages on the Vessel and a
breach of at least one of those mortgages and thus were entitled to arrest
the Vessel pursuant
to Rule
C(l)(b)
in connection with 46 U.S.C.
§
31325(b)(1).
(Doc. 64, at 2-5.)
Based on the foregoing and the admiralty
claim created by
46 U.S.C.
§ 31325(b)(2)(A),
the
Court
also
denied
Defendants'

Cross-Motion for Reconsideration.

(Id.

at 6-7.)

8 More specifically, on May 26, 2016, Plaintiffs filed a motion seeking, inter
alia, the interlocutory sale of the Vessel, which the Court granted on August
8, 2016.
(Doc. 28; Doc. 48, as subsequently amended in part by the Court's
Order dated August 4, 2016, Doc. 65 (as amended, the "Order for Sale").)
As
set forth in the Order for Sale, the interlocutory sale of the Vessel was
warranted because of: (1) the great expense being incurred to keep the Vessel

seaworthy

(thereby deteriorating its value as collateral for Plaintiffs and

other creditors);

and (2) the limited tools available to the Vessel's crew to

prevent corrosion and other physical deterioration.
(Doc. 48.)
See Fed. R.
Civ. P., Supp. Adm. R. E(9)(a).
Notice of the sale of the Vessel was duly
published by the United States Marshal for the Southern District of Georgia,
Savannah Division

70-1.)

(the "Marshal")

On August 8,

2016,

pursuant to Local Admiralty Rule 4.

(Doc.

the sale of the Vessel was duly conducted in

accordance with the Order for Sale by the Marshal at the premises of the
entrance to the United States District Court, Savannah, Georgia.
(Doc. 66.)
At the sale, Strategic presented a bid of $7,400,000.00 (plus the current

market price of any fuel or gas oil
of its delivery to the successful
and was the highest bidder capable
August 8, 2016, Strategic presented
for payment of the remainder of its

remaining on board the Vessel at the time
bidder) (collectively, the "Sale Price")
of performing at the auction.
(Id.)
On

$1,000,000.00 to the Marshal as security
bid. On August 11, 2016, Strategic made

a wire transfer to the Clerk of Court in the amount of $6,400,000.00 to be

applied towards its bid upon the successful confirmation of the
August 8, 2016.
The Court confirmed the sale of the Vessel to
August 16, 2016 (the "Confirmation Order").
(Doc. 75.)
As set
Confirmation Order, any claims in the Vessel existing on the

sale held on
Strategic on
forth in the
date of the

Confirmation Order - including those claims held by Plaintiffs and other
lienors - were terminated and the Vessel was sold to Strategic "free and
clear of all liens and encumbrances," but any claims terminated thereby
"would attach in the same amount and in accordance with their priorities to

the proceeds of the sale as provided in 46 U.S.C. § 31326(b) . . . ."

(Id.

D.

DHL's Attachment,

Upon

Action

of

October

25,

2016,
for

to

14,

2016,

of

verified

Court

maritime

Rule

however,

the

and Settlement in the DHL Action

DHL's

the

pursuant

attachment

Vessel

complaint

entered orders
attachment

B.

(DHL

the

DHL

moved

DHL

directing the

Doc.

to

Action.

the

garnishment

Action,

Plaintiffs

in

and

in

2.)

.

vacate

(DHL

of

On

DHL's

Action,

Doc.

Upon concluding that DHL had failed to demonstrate a prima

facie

admiralty

granted

claim

Plaintiffs'

garnishment
Proceeds)

of

on

December

5,

vacating

the

2016,

Bill

Vessel

DHL

Sale

for

required

and

in

vacated

and

its

2016.

moved

under

the

B,

DHL's

res

Action,

Court

and

(i.e.,

Doc.

reconsideration

DHL Action,

the

attachment

substitute
(DHL

for

Rule

of

the

24.)

On

Order

this

which

the

Court

(DHL Action, Docs. 27, 42.)

On August 19,
of

18,

attachment

recently denied.10
at 7-8.)

as

motion

November

its

a

of

process

Vessel

16.)

filing

on May

issuance

the

the

Vacatur,

2016,

the

the Marshal executed and delivered to Strategic

Vessel.

(Doc.

79.)

The

Vessel

was

delivered

to

Strategic on August 21, 2016.
(Swimmer 09/27/2016 Decl., Doc. 86-1, 1 8.)
9 During the pendency of this action, Plaintiffs have filed several motions
seeking the authorization of certain in custodia legis expenses incurred by
Plaintiffs during the Vessel's arrest from April 19, 2016 through August 21,
2016,

in the total amount of $704,690.91.

(Docs.

28,

69,

86.)

The Court has

granted each of these motions, for a total amount of authorized in custodia
legis expenses incurred by Plaintiffs to date of $704,690.91.
(Docs. 48, 81,
97.)
Plaintiffs have also filed several motions requesting the disbursement
of funds from the Proceeds to satisfy these in custodia legis expenses, which
the Court has granted.
(Docs. 77, 81, 101, 108.)
Notably, while the Court
did not authorize DHL to incur any in custodia legis expenses in connection
with the arrest/attachment of the Vessel,
and

ordered

that

DHL

be

reimbursed

from

the Court exercised its discretion
the

Proceeds

for

the

advanced for the post-arrest care of the Vessel, namely $84,462.20.
Action,

Doc.

funds

DHL

(See DHL

38.)

10 In its motion for

reconsideration of the Order vacating its attachment of

the Vessel,
DHL states that it and the Sub-Charterer entered into a
"confidential settlement agreement" on December 1, 2016 whereby, inter alia,
8

On

February

22,

2017,

DHL

filed

Final Judgment" in the DHL Action,

entered into a

DHL

in

the

obligated

"Motion

for

to

DHL
DHL

Action,
in

whereby,

the

amount

inter

of

alia,

NCL:

defenses,

ownership

interest

in

the

Proceeds

see also Settlement Agreement,

& 2(C);

Power

in

Motion

its

Decl.,

Doc.

for

Entry

executed a

"Consent

styled

a

as

represented
(DHL

DHL

by

is

Action,

U.S.

Doc.

Doc.

33,

27,

the

at 3-4;

due

at

Doc.

1-2,

Final

is

see

33 at

and

to

3-5.)

Doc.

27-1,

has

(c)

DHL

(up

that

to

to

(DHL Action,

that

which

has

incurred by

DHL

admitted

Sub-Charterer in the
DHL Action,

2.)

fact

also

(b)

118-1 at 4-14,

Judgment

the

who

2;

SI

Judgment"

to

counsel

DHL Action,

obligated to

of

at

Entry of

Stipulation

Action,

Judgment,

for

118-1

Doc.

is

and counterclaims

DHL in the present action and the DHL Action).11
33;

(the

(a)

$2,371,491.15;

the amount of $2,371,491.15 plus any costs and fees

Doc.

2017

with NCL with regards to the claims made

with respect to the claims against i t by Plaintiffs;
its

of

wherein i t states that i t has

assigned to DHL all of NCL's rights,

assigned

Entry

settlement agreement dated February 17,

"Settlement Agreement")
by

a

also

it

"has

[NCL]

this

SISI 2

stated

and

not

NCL

been

is

not

Court."

Consent

for

Finally,

DHL requested

amount

of

II 14(c)

Entry

$250,000.00.
& 24.)

the Court upheld the vacatur of DHL's attachment because -

of

(DHL

Nonetheless,

as originally set

forth in the Court's Order vacating DHL's attachment - DHL's claims in the
DHL Action were unripe at the time it sought attachment of the Vessel.
(See
Doc.

11

42,

at 4-10.)

Notably,

DHL

failed

to

file

a

copy

of

the

Settlement

Agreement

in

connection with its Motion for Entry of Final Judgment.
Approximately one
month later, however,
DHL filed a copy of the Settlement Agreement in
connection with its present motion for reconsideration of the Summary
Judgment Order.
(See DHL Action, Doc. 33; see also Settlement Agreement.)

that

"Final

amount

of

Judgment

be

entered
in

$2,371,491.15

against
form

Judgment"

which

DHL

"Proposed

Final

the

attached as

Judgment") .

denied

Judgment

or

DHL's

Consent

for

Entry

Action,

Doc.

of

to

enshrine

the

Judgment

in

a

its

Doc.

at

33-1.)

(the

2;

see

The Court

Proposed

Settlement

the

Final

motion

33,

the

judicial

in

proposed

to

Doc.

enter

...

the

exhibit

DHL Action,

request

otherwise

of

(DHL Action,

also Proposed Final Judgment,

recently

an

[NCL]

Final

Agreement

decree.

(See

and
DHL

43.)

E. DHL's Attempts to Consolidate & Intervene

On
the

July 28,

Vessel,

DHL

2016,

shortly before the interlocutory sale of

filed

a

motion

with the instant action.
2016,

the

Court

denied

to

consolidate

(DHL Action,
DHL's

Doc.

motion

to

the

11.)

DHL

Action

On August 25,

consolidate

on

the

grounds that the two actions did not present common questions of
law

or

2016,

fact.
DHL

Federal

4,

filed

Rule

2016,

(DHL Action,

the

of

a

motion

Civil

Court

to

Doc.

at

intervene

Procedure

denied

13,

3-4.)

in this

24(a).

(Doc.

DHL's motion

to

On
case

September

8,

pursuant

to

80.)

On

intervene

October

on

the

grounds that DHL had failed to demonstrate a sufficient interest
relating to the property or transaction which is the subject of
this

action.

(Doc.

94.)

On

October

11,

2016,

DHL

filed

its

Notice of Interlocutory Appeal and a motion to stay this action
10

pending

the

November

2,

Eleventh

2016,

Circuit

Motion to

the

resolution

Stay

Decision

November

18,

the

that

United

entered

an

Pending Appeal

on

the

2016,

pending

appeal.

Circuit

issued

October

5,

case

[this

to

of

this
(Doc.

its

2016

Stay

Court]

On July

judgment.14

8,

(Doc.

an

109.)

On

July

vacating

DHL's

intervention
sees

The

Eleventh

reconsideration
pending appeal.

Appeals

DHL's

for

Pending

107.)

On

motion to

2017,

the

"Emergency

(Doc.
DHL's

On

the

Court's

stay

Eleventh

Order

dated

and

"remand[ed]

fit

in

light

the

of the

Motion for Summary Judgment

Plaintiffs

43.)

Circuit

99.)

(Doc. 126, at 3; Doc. 127.)

filed

On July

their motion

21,

Defendants to conduct factual discovery,
12

6,

this

it

98,

Interim Order

denied

to proceed as

2016,

of

denying

and for

also

Plaintiffs'

Court

Order

Court

current status of the case."13

F.

States

(Docs.

Application."12

mandate

denying

appeal.

also

denied

of the Eleventh Circuit's
(See Doc. 110.)

2016,

so

for

as

summary

to

allow

Defendants were granted

DHL's

subsequent

Order denying

motion

the motion

for

for
stay

13 (See Doc. 126, at 3 ("In short, a lot has happened since the district court
entered the order that is
district
court
to
take

now before us.
We think the best
another
look
at
its
denial
of

course
DHL's

is for the
motion
to

intervene in view of all that has happened since it ruled on that motion.
Because the same district court judge is hearing both cases, he is in a good

position to determine which of the motions pending before him [DHL Action]

they

and the current case -

should be

decided.

So

in both the

should be decided in which order and how

we vacate

the

order

denying

DHL's

motion

to

intervene and remand the case to the district court to proceed as i t sees fit

in light of the current status of the case.

In doing so, we imply no view on

how the motion to intervene should be decided.").)

14 On July 11, 2016, the Clerk of this Court sent a notice to Defendants
advising them of the summary judgment motion and the summary judgment rules,
their right to file affidavits or other materials in opposition, and the
consequences of default.

(Doc.

45.)
11

until

October

summary

2016

judgment.

Defendants'

record

14,

withdraw

(Doc.

counsel

after

to

filed

having

on August

respond

55,

at

their

provided

30,

to

Plaintiffs'

2. )

On

motion

to

2016.

(Doc.

with

83.)

On

the Court granted counsel for Defendants'

its

Order,

counsels'

the

Court

withdrawal,

specifically
they

would

therefore unable to proceed.15

September

withdraw

Defendants

(Doc.

as

16,

counsel

of

intent

to

their

October

that

left

95.)

for

2016,

5,

2016,

motion to withdraw;

noted

be

motion

upon

in

their

unrepresented

and

To allow Defendants

sufficient time to secure new counsel and respond to Plaintiffs'
motion

for

November

4,

judgment.16
have

(b)

summary judgment,
2016

to

(Id. at 2.)

new counsel

respond

respond

to

enter

or

the Court granted Defendants until
to

Plaintiffs'

motion

for

summary

Nonetheless, Defendants failed to:
a notice

otherwise

of appearance

defend

against

in this

case;

Plaintiffs'

(a)
or

motion

for summary judgment.

On

merits

evidence

Summary

March

of

20,

2017,

Plaintiffs'

submitted

Judgment

in

Order

after

a

motion

support

thorough

for

summary

thereof,

granting

consideration

summary

the

judgment

Court

judgment

of

the

and

the

entered

the

in

favor

of

15 See Palazzo v. Gulf Oil Corp., 764 F.2d 1381, 1385 (11th Cir. 1985) (a
corporation may not proceed pro se or by a representative or agent of the
corporation).

16 In its Order - a copy of which was mailed to NCL's Vice President of Claims
and Risk Management, Mr. Spyros Theodoropoulos - the Court explicitly noted
that Defendants' "[f]ailure to timely respond to Plaintiffs' motion for
summary judgment may result in Plaintiffs' motion for summary judgment being
deemed unopposed."

(Doc. 95, at 2.)
12

Plaintiffs

on

all

conclusion

of

the

Plaintiffs

to

"perfect

balance
2017.

of

their

(Id.

entry of

denying

at

of

their

Summary

17.)

Judgment

the

claims

claims.

record

against

.

.

damages

for

Plaintiffs'

concerns

regarding

counterclaim for wrongful

cause

as

to

with prejudice;

the

In

Court

with

the

ordered

regards

the

March

through

to

20,

why:

and (b)

viability

of

and therefore

claim

should

this case closed.

2017,

of

the

arrest of the Vessel - it had

the

such

arrest

ordered them to

not

be

dismissed

(Id. at 18.)

briefing and evidence demonstrating the balance of

their claims

Defendants

Defendants,

as

however,

cause.

Plaintiffs

Defendants'

supplemental

show

21,

and the Orders

alleged wrongful

arrest"

(a)

Plaintiffs

their

against

March

.

116.)

The Court also noted that - in light of the

summary judgment in favor of

"serious

On

Order,

Defendants"

Vessel and reinstating Plaintiffs'

show

(Doc.

directed

failed to

Rather,

on

March

by

filed

the

Court.

respond to
30,

2017,

the
DHL,

(Doc.

Court's

117.)

order

purporting

the "assignee of the defenses and counterclaims of

to

to
be

[NCL] in this

action" filed a motion wherein it:

(i) renews its prior attempts

to

seeks

intervene

grant

of

Defendants;

in

this

summary
and

action;

judgment

(iii)

(ii)

in

purports

to

favor

of

Plaintiffs

respond to

to show cause directed towards Defendants.

13

reconsideration

of

against

the Court's

(Doc.

118.)

the

order

II.

A.

As

more

fully

dated October

matter

of

"should

DHL's

4,

(Renewed)

explained

2016,

right

DHL

be

Defendants,

Plaintiffs'

over

of

money

DHL,

from

claims

against
Notably,

Vessel

and

80,

6-7;

M

that

DHL

English

the

to

Rule

now-vacated

sought

to

intervene

by

arguing

24(a)(2)
on

Order

their

claims

as

a

that,

against

therefore

which

DHL

(Doc.

there

can

94,

will

be

recover

at

6-7;

on

less

its

(or

no)

unrelated

see also Doc.

80,

11

this argument relied on DHL's attachment of the

its

substitute

res

(i.e.,

see also DHL Action,

does

law

Court's

liens on the Proceeds will have priority

[NCL]."

6-7.)

in

successful

and

available

Motion to Intervene

originally

pursuant

Plaintiffs

those

DISCUSSION

not

-

hold

which

a

Doc.

maritime

governs

the

the

38,

lien

charter

Proceeds).

at
on

11 n.5
the

(See

(concluding

Vessel

party

Doc.

because

agreement

upon

which the DHL Action relies - does not grant a maritime lien for

breach of charter party);
attachment,

however,

reconsideration
Docs.

24,

Here,

pursuant
similar

of

Doc. 116, at 16 n.14

(same)).

DHL's

was subsequently vacated and its motion for
that

vacatur

has

been

denied.

(DHL

Action,

42.)

DHL's original

to

Rule

24 (a)

and renewed motions

are

due

to

be

for intervention

denied

for

to that originally expressed by the Court

vacated Order

dated October

4,

2016
14

(see

doc.

94,

reasoning

in its nowat

4-9;

see

also doc.

126,

at

3);

because DHL -

- is not a party to the Notes,
not

have

a

that

it

and/or

has

a

transaction
Chiles

the

is

interest

the

Thornburgh,

v.

which

865

F.2d

that:

(1)

his

has

of

failed

to

to

present

1213

(11th

to

intervene

property

Cir.

is

those

action.

of right under Rule

application

in

demonstrate

the

the

1197,

own claims

its

interest

relating

subject

party seeking to intervene as
show

DHL

for

or Mortgages and does

independent

Vessel,

sufficient

least

Guaranties,

legally-protectable

instruments

at

See

1989)

24(a)(2)

timely;

or

("A

must

(2)

he

has an interest relating to the property or transaction which is
the

subject

of

the

action;

disposition of the action,

impair

his

interest
the

is

suit."

Rehab.

ability

to

as

(3)

he

is

so

situated

a practical matter,

protect

that

interest;

that

may impede or

and

(4)

his

represented inadequately by the existing parties to
(citations

Servs.,

omitted));

State of Fla.,

Worlds

v.

929 F.2d 591,

("In determining sufficiency of

interest,

Dep't
594

this

of

Health

(11th Cir.

circuit

&

1991)

requires

that the intervenor must be at least a real party in interest in
the

transaction

interest

legally

has

Cir.

v.

also

citations,

Sandy Lake

2005)

("[A]

is

been

protectable

quotations,
Co.

which

the

subject

described

interest

in

of

as

the

the
a

proceeding.

direct,

Properties,

Inc.,

substantial,

proceedings."

and footnotes omitted));
425

F.3d

Mt.
1308,

This

(internal

Hawley Ins.
1311

(11th

legally protectable interest is something more
15

than

an

economic

omitted) ) .

interest."

Moreover,

November

18,

2016,

may

had

in

have

as

any

the

(internal

quotations

noted by the

independent

Vessel

and/or

Court

right

the

in

or

and

its

citations

Order

interest

Proceeds

dated

that

resulting

DHL

from

its attachment is no longer in existence based on the vacatur of
that attachment.

In its
that

it

(See Doc.

109,

renewed motion to intervene,

must

be

allowed

to

intervene

position as the assignee of

.

.

[and]

at

6-7;

renewed

more

of

however,

at 4.)

[NCL's]

also

motion

the

it

to

Settlement
intervene

Defendants'

is

more

Rule

"[o]n

based

SI

to

25(c)

on

interests

rather

pursuant

to

Rule

interest

is

transferred,

24(a).17

See
the

a

transferee

to

be

in

than

the

action

the original party.");
17

Plaintiffs

argue

that

in

DHL's

renewed

attempt

of

one

or

lawsuit,

motion

to

substitute

to

intervene

may

see also Virgo v.

DHL's

motion

a

the

.

Because

present

Fed. R. Civ.

substituted

DHL's

118,

transfer

P.

be

against the original party unless the court,
the

of

(See Doc.

2(B).)

properly considered a

pursuant

basis

[Proceeds]."

Agreement
is

the

DHL now argues

defenses and counterclaims

ownership interest in the
see

however,

25(c)

("If an

continued

by

on motion,

action

or

or

orders

joined with

Riviera Beach Assocs.,
to

intervene

is

improper

because, inter alia, NCL's alleged assignment of its "rights, defenses, and
counterclaims" in the present action to DHL is void because the Notes,
Guaranties,
and
Mortgages
allegedly
prohibit
assignment
without
the

respective instrument-holder's consent.
(Doc. 122, at 17-21.)
In response,
DHL argues that the defenses and counterclaim allegedly assigned to it by NCL
"are not contractual claims,

but are claims which arise out of tort."

(Doc.

125, at 8.)
For the purposes of this Order, the Court has assumed - without
deciding - that the aforementioned assignments are effective.
16

Ltd. ,

30

F.3d

authorizes

a

1350,

1358

substitution

(11th

of

Cir.

parties

1994)

after

("Rule

a

25(c)

transfer

of

interest has occurred/') .

"Rule 25
not

is

a procedural rule of

substantively

Telecomm Tech.

1999

WL

the

at

Grain

"[a]

Rather,

Servs.

696011,

Covington

alter

a

Inc.

*3

party's

v.

Siemens Rolm Commc'ns Inc.,

(N.D.

Co. ,

638

Ga.

F.2d

party"

continuance

of

and

the

rights

July

6,

1357,

substituted party steps

original

convenience only and does

the

action

as

proceeding against the substitute party.
F.2d
under

513,

516

Rule

25(c)

trial court."

2488302,
at

at

1357).

(5th

Cir.

is

*7

(S.D.

"The

1971).

committed

FDIC v.

"The
to

Court

Aug.

may

13,

in

2009)

its

substituted

for

the

original

party,

joined as an additional party."
Here,
intervene,

the

Court

Rule 25(c),

DHL

that

does

not

to

a

Lending,

new

Brennan,
of

a

LLC,

order

437

motion
of

the

2009 WL

30

F.3d

that

the

that the transferee be
that

the

transferee

be

that

DHL's

renewed

motion

to

a motion to substitute pursuant to

should be granted.

notes

a

Id.

concludes

when considered as

or

of

(citing Virgo,

original party continue the action alone,

re

1981)).

discretion

discretion

In

position

opposed

sound

1,

considered

is

disposition

the

Cir.

same

Ransom v.

Bristol Home Mortg.

Fla.

the

No.

(citing

(5th

substitution

original

liabilities."

1999)

1361

into

or

In doing so, however,

allege
17

that

it

has

the Court

received

a

full

assignment

of

NCL's

Agreement 1 2(C)
in

and

in

(" . . . [NCL]

ownership

of

the

Amount

(emphasis

added)).)

the

Proceeds.

(See

Settlement

irrevocably assigns its interest
up

[Proceeds]

[i.e.,

Settlement

added as

interest

to

$2,371,491.15]

Accordingly,

an additional defendant,

the

the

plus

Court

amount
DHL['s

orders

of

the

c]osts."

that

DHL be

with the express understanding

that DHL's rights and obligations upon being added to this case
are derived from those assigned to

indeed,
shoes'

as noted by DHL itself,
of the assignor."

B.

In

grant

its

of

pursuant

DHL's

motion,

summary

to

Rule

DHL

59(e)

manifest injustice.

125,

at 6.)

reconsideration

to

based

Plaintiffs

seeks

reconsideration

the

'excusable neglect'

pursuant

of

the summary judgment motion."

of

the

against

Court's

Defendants

on newly-discovered evidence

(See Doc. 118 at 7-8.)

DHL

'steps into the

for Reconsideration

seeks

judgment

by NCL and nothing more;

"DHL as assignee

(Doc.

Motion

it

[NCL]

to

for

Rule

and

In the alternative,
60(b)(1)

failure

to

"based

on

timely oppose

(Id. at 8 n.4.)

A party may seek to alter or amend a judgment in a civil
case within twenty-eight days after the entry of the judgment.
Fed.

R.

Civ.

P.

59(e).

Because

reconsideration

of

a

judgment

after its entry is an extraordinary remedy which should be used

sparingly,

a movant must set forth facts or law of a strongly
18

convincing

nature

decision.

Bostic

July

31,

to
v.

2012).

relitigate

induce

the
2012

Astrue,

A

Rule

old matters,

court
WL

59(e)

to

reverse

3113942,

motion

raise argument

its

prior

at

(S.D.

Ga.

not

may

*1

be

used

"to

or present

evidence that

could have been raised prior to the entry of judgment," as

only

grounds

discovered

v.

King,

for

evidence

500

omitted).

granting
or

F.3d

Nor is

Rule

manifest

1335,

Rule

a

errors

1343

59(e)

see

also

108

F.

Bostic,
Gold

Supp.

Cross

3d

has

for

thought

DHL

v.

or

Cir.

newly-

fact."

2007)

appeal,
to

ask

—

at

*1

Arthur

(quotations

(citations

Children's

(S.D.

through

citations,

App'x 976 (11th Cir.

Here,

1379
an

law

are

for refuting the court's prior

3113942,

Inc.

reconsideration

already

quotations,

not

motion

"a vehicle for rehashing arguments

WL

EMS,

1376,

reconsideration is
motion

2012

of

(11th

already rejected by the court or
decision."

59(e)

"the

Ga.

2015)

and thus
the

Hosp.

Court

rightly

or

of

("[A]

it

is

to

omitted);
Alabama,

motion

improper on a

rethink

wrongly."

and alterations omitted)),

for

what

it

(internal

aff' d,

648

F.

2016).

has

failed

to

demonstrate

newly-discovered

evidence or manifest errors of law or fact that would justify a

finding

that

Judgment Order.

the

Court

for

amend

or

alter

DHL asserts that "new facts

DHL as assignee of
its motion

should

[NCL's]

defenses

reconsideration.

Summary

. . . obtained by

and counterclaims" support

(Doc.

19

its

118,

at

8-22.)

Yet none

of the facts proffered by DHL are newly-discovered;
have

been

their

available

responsive

and/or

could

have

been

motion

for

such,

Defendants

pleadings

Defendants

As

to

DHL

or

through

timely

presented

summary judgment.

time

otherwise

118-1

filed

to

mechanisms

opposition

Docs.

they

available

discovery

in

(See

the

they

to

and

Plaintiffs'

through

118-7.)

these facts are not a proper basis for reconsideration

59(e)

motion

cannot

raise

argument

or

prior

to

entry

omitted));

772,

were

civil

of the Summary Judgment Order.
Rule

since

rather,

the

be

present
of

See Arthur,
used

to

relitigate

evidence that

judgment."

500 F.3d at 1343

could have

(citations

see also Osaigbovo v. Bank of Am.

774

(11th

Cir.

2016)

("Osaigbovo

and his

affidavit,

but

matters,

been raised

and

Corp.,

alterations
671 F. App'x

attached

postjudgment motion copies of bank statements,
correspondence,

old

("A

to

his

several pieces of

those

documents

did not

constitute newly-discovered evidence because they were available
to

him when

v.

J&J

he

Snack

filed his

Foods

("Distributors

complaint.");

Corp.,

relies

on

ICEE

445

F.3d

841,

facts

that

were

easily discovered before summary judgment.

Distributors,

848

(5th

plainly

Cir.

Inc.

2006)

available

or

. . . The events in

question did not occur after summary judgment; and no reason is
offered that

knowledge of these events was beyond Distributors'

reach

then.

before

The

District

20

Court

therefore

did

not

abuse

its

discretion

by

refusing

to

consider

Distributors'

newly

proffered evidence.").

Similarly,
to

prevent

'default'

manifest

of

demonstrate

justice

Supp.

DHL's argument that "reconsideration is required

[NCL]"
a

3d at

is

"clear

demand

1380.

and

summary

judgment,

- but

reconsideration.

be

(11th

used

not

1998)

raise

Gold

v.

Wall,

135

DHL

where

Cross

effective

has

EMS,

failed

to

interests

of

Inc.,

the

is

Defendants

not

Lockard v.
("Motions

a

F.

108

Equifax,
for

arguments

F.3d

1438,

in opposition to

proper
Inc.,

basis

163

reconsideration

which

could

been made before the judgment was issued."
Stone

th[e]

DHL simply raises arguments that were

raised by -

legal

by

because

error

See

which
See

Cir.

to

obvious

Rather,

to

caused

unavailing

correction."

available

1267

injustice

1442

and

for

F.3d

1259,

should

should

not

have

(citations omitted));

(11th

Cir.

1998)

("The

purpose of a Rule 59(e) motion is not to raise an argument that
was

previously

Co.

v.

Cir.
out

Glenn

1985)
errors

available,

Estess

but

not

& Assocs.,

pressed.");

Inc.,

763

Am.

Home

F.2d 1237,

Assur.

1239

(11th

("There is a significant difference between pointing
in

a

court's

decision

on

grounds

that

have

already

been urged before the court and raising altogether new arguments
on

a

motion

affords

a

omitted)).

to

amend;

litigant

if

'two

Importantly,

accepted,

bites
contrary
21

at
to

the

the

latter

apple.'"

DHL's

essentially

(citations

insinuations

that

this

Court

simply

Defendants as

entered

summary

judgment

by

default

a penalty for their failure to respond,

reached the merits of Plaintiffs'

against

the Court

motion and entered judgment in

favor thereof based on the evidence introduced in support of the

motion and the

thereto.18

facts admitted by Defendants'

(See Doc.

116.)

failure to respond

That DHL is bound by the operation

of law is not a manifest injustice.19

Nor is

it a manifest

18 See United States v. One Piece of Real Prop. Located at 5800 SW 74th Ave.,
Miami,

Fla.,

363

F.3d

1099,

1101-02

(11th Cir.

2004)

("[T]he district

court

cannot base the entry of summary judgment on the mere fact that the motion
was unopposed, but, rather, must consider the merits of the motion.
The
district court need not sua sponte review all of the evidentiary materials on
file at the time the motion is granted, but must ensure that the motion
itself is supported by evidentiary materials.
At the least, the district
court must review all of the evidentiary materials submitted in support of
the motion for summary judgment." (citations omitted))/ cf. Trustees of Cent.
Pension Fund of Intf1 Union of Operating Engineers & Participating Employers
v. Wolf Crane Serv., Inc., 374 F.3d 1035, 1040 (11th Cir. 2004) ("It is
apparent that the district court did not examine the merits of this case, but
instead granted summary judgment by default merely because it believed [the
defendant] had filed no response.
Because summary judgment cannot be granted
as a sanction for merely failing to file a response to a motion for summary
judgment, we vacate the judgment of the district court with respect to Count
II."

(footnote omitted)).

19 See LR 7.5, SDGa.
("Failure to respond within the applicable time period
shall indicate that there is no opposition to a motion."); LR 56.1, SDGa.
("All material facts set forth in the statement required to be served by the
moving party will be deemed to be admitted unless controverted by a statement
served by the opposing party."); Fed. R. Civ. P. 56(c)(1)(A) ("A party

asserting that a fact cannot be or is genuinely disputed must support the
assertion by . . . citing to particular parts of materials in the record,
including
depositions,
documents,
electronically
stored
information,
affidavits

or declarations,

stipulations

(including those made

of the motion only), admissions, interrogatory
. . ."); Fed. R. Civ. P. 56(c)(3) ("The court
materials, but it may consider other materials
P. 56(e) ("If a party fails to properly support

for purposes

answers, or other materials .
need consider only the cited
in the record."); Fed. R. Civ.
an assertion of fact or fails

to properly address another party's assertion of fact as required by Rule
56(c), the court may: ... (2) consider the fact undisputed for purposes of
the motion; [or] (3) grant summary judgment if the motion and supporting
materials — including the facts considered undisputed — show that the movant
is entitled to it . . . ."); see also Dunlap v. Transamerica Occidental Life
Ins. Co., 858 F.2d 629, 632-33 (11th Cir. 1988) (upholding district court's

grant of summary judgment and denial of motion for reconsideration where nonmoving party failed to file opposition to motion for summary judgment and
failed to "specifically direct the district court's attention to any
22

injustice

that

in-interest;
left,

not

motion

it

DHL

where

for

is

bound by the missteps

steps
DHL

into

wishes

reconsideration

NCL's
they

shoes

had

pursuant

of

where

been.

to

its

predecessor-

they

have

Accordingly,

Rule

59(e)

is

due

been
DHL's

to

be

denied.

DHL also

should

be

granted

^excusable
summary

to

for

that,

in

pursuant

neglect'

of

Defendants'

summary

who

[Rule]

(Doc.

118,

"reconsideration

60(b) (1)

failure

to

at

to
8

based

n.4.)

respond to

the

oppose

timely

on

the

In an attempt

Plaintiffs'

motion

submitted the declaration of non

Ltd.'s

alleges

alternative,

for

DHL has

Holdings

Despotopoulou,

to

failure

judgment,

Newlead

the

[NCL]

judgment motion."

explain

party

argues

Chief

that

Financial

NCL's

failure

Officer,
to

Eleni

respond

to

[rebuttal] evidentiary material" that allegedly existed in the record at the
time of grant of summary judgment); Little v. Cox's Supermarkets, 71 F.3d
637,
641
(7th Cir.
1995)
("[A] party contesting summary judgment has a
responsibility . . . to highlight which factual averments are in conflict as
well as what record evidence there is to confirm the dispute.

.

.

.

[J]ust as

a district court is not required to scour the record looking for factual
disputes, it is not required to scour the party's various submissions to
piece together appropriate arguments.
A court need not make the lawyer's
case." (internal quotations and citations omitted)); Waldridqe v. Am. Hoechst
Corp., 24 F.3d 918, 920-22 (7th Cir. 1994) ("[B]ecause summary judgment is
not a paper trial, the district court's role in deciding the motion is not to

sift

through

the

evidence,

pondering

the

nuances

and

inconsistencies,

and

decide whom to believe.
The court has one task and one task only: to decide,
based on the evidence of record, whether there is any material dispute of

fact that requires a trial.
The parties, in turn, bear a concomitant burden
to identify the evidence that will facilitate this assessment.
[D]istrict courts are not obliged in our adversary system to scour the record
looking for factual disputes and may adopt local rules reasonably designed to
streamline

the

resolution

of

summary

judgment

motions.

We

have

repeatedly upheld the strict enforcement of these rules, sustaining the entry
of summary judgment when the non-movant has failed to submit a factual
statement in the form called for by the pertinent rule and thereby conceded
the

movant's

Dunkel,

version

927 F.2d 955,

of

the

956

facts."

(citations

(7th Cir. 1991)

for truffles buried in briefs.").
23

omitted));

United

States

v.

("Judges are not like pigs, hunting

Plaintiffs'

motion

leadership

and

118-2,

Doc.

was

lack

SI

60

caused

by

cash

flow.

of

("Despite

changes

in

(See

Defendants'

Newlead

Holding's

Despotopoulou

active

Decl.,

participation

this action up to the improper withdrawal of its counsel,
change

in

leadership

Zolotas resigned as
was

not

issues

cash

Castellano's
Castellano

as

CEO

flow

income
was

Newlead Holdings

during

that

due to

time

(Mr.

CEO of Newlead Holdings in October 2016,

reinstated

with

at

until

the

resulting

earning

unable

to

end

from

asset

of

the
-

December

seizure

the

immediately

retain

Vessel,
new

and

2016) ,

of

in

and

Newlead
Newlead

counsel

or

respond to the Plaintiffs' motion for summary judgment.").)
Rule

such

60(b)

terms

party's

provides

as

legal

are

just,

in

relevant

the

representative

court

from

part:

may

a

(1)

surprise, or excusable neglect . . . ."

"[F]or purposes of Rule 60(b),

to

encompass

filing

situations

deadline

is

(citing

Pioneer

attributable

Inv.

Servs.

a

mistake,

to

negligence."

71 F.3d 848, 850

Co.

P'ship, 507 U.S. 380, 394 (1993)).

v.

to

order,

a

or

60(b)(1).

is understood

comply with a
Cheney

(11th Cir.

Brunswick

or

inadvertence,

Fed. R. Civ. P.

failure

and upon

party

judgment,

'excusable neglect'

in which the

Anchor Glass Container Corp.,

relieve

final

proceeding for the following reasons:

"On motion

v.

1996)

Assocs.

Ltd.

"[W]hether a party's neglect

of a deadline may be excused is an equitable decision turning on
all

relevant circumstances surrounding the party's omission

24

. .

. includ[ing]

length

of

the danger of prejudice to the opposing party,

the

proceedings,

delay

and

potential

the reason for the delay,

within

the

reasonable

movant

acted

alterations

its

in

control

good

omitted)

of

faith."

the

Id.

impact

judicial

including whether it

was

movant,

whether

the

quotations

and

and

(internal

(citing Pioneer

on

the

Inv.

Servs.

Co.,

507

U.S.

at 395).

Here,

the

demonstrate

respond to

Court

Defendants'

Plaintiffs'

filed their motion

Doc.

43.)

notice

excusable

motion for

On July 11, 2016,

of

the

thereto.

(Doc.

to

motion

DHL

has

for

On

to

neglect

in

failing

summary judgment.
July 8,

to

to

timely

Plaintiffs
2016.

(See

Defendants were provided explicit
summary

July 21,

judgment,

Plaintiffs'

2016,

the

deadlines

the Court extended the

motion

from August 1 to October 14, 2016.
further extended the

failed

and the consequences of failing to respond

45.)

respond

that

for summary judgment on

associated therewith,

window

concludes

(Doc.

for

55,

summary

at 2. )

judgment

The Court

window to respond to November 4,

2016 and

again reminded Defendants that "[fJailure to timely respond to
Plaintiffs'

motion

for

summary

judgment

may

Plaintiffs' motion . . . being deemed unopposed."20

20

This

extension

Defendants'

was

granted

counsel to withdraw.

On Drugs & Cosmetics Corp.,

sua

sponte

in

See J.D. Pharm.

893 F.2d 1201,

1209

connection
Distributors,

(11th Cir.

result

in

(Doc. 95, at

with

allowing

Inc. v. Save-

1990)

("It is

generally recognized that a trial court has wide discretion to control its
docket,

and that decisions of the trial court as to matters such as the
25

2.)

Nonetheless,

for

summary

the Court delayed ruling on Plaintiffs'

judgment

extended deadline.
two-hundred

anything
prior

and

in

to

for

(See Doc.

fifty

days

opposition

its

another
116.)

to

to

four

do

months

Indeed,

so,

summary

judgment

accordingly,

-

let

not

to

the

alone

reason

evidence

timely

receive

for

in

the

deadlines

thereof),

or

the

alleged

irrelevant

Holdings

because

motion.21

-

of

the

of

-

it

was

failing

leadership

was

NCL

at
-

obligated

been no

that

and

Defendants

motion

to

not

to

motion

(or

argument

for

the

respond

to

summary

thereto.

Ltd.

non-party

respond

did

extensions

Newlead Holdings

and

file

circumstances

has

associated therewith

in

that

there

thereof

to

and/or DHL's favor.

Plaintiffs'

consequences

changes

Ltd.

support

notice

judgment,

The

the delay,

twice-

despite having over
failed

length of delay do not weigh in Defendants'
As

this

Defendants

Plaintiffs'

adjudication;

past

motion

are

Newlead

Plaintiffs'

Further, as to the bald assertion of "issues with cash

amount of time a

litigant should be given to obtain counsel are reviewable

only under an abuse of discretion standard.").

21 Notably,
Action,

in support of its Motion for Entry of Final Judgment in the DHL

DHL asserted

that

Mr.

Zolotas

never

resigned

from

his

position

as

president and director of NCL.
(See DHL Action, Doc. 39, at 6-7 ("Indeed,
despite Mr. Zolotas' resignation from Newlead Holdings [Ltd.] in October
[2016], he remains the President and Director of [NCL].
Attached hereto as
Exhibit 1 is [a] true and correct copy of Apostilled corporate minutes from

the Republic of Liberia confirming that Michail Zolotas acts as the President
and

Director

of

[NCL]

since

2013.

Attached

as

Exhibit

2

is

a

true

and

correct copy of a Certificate of Good Standing for [NCL] dated March 16,
2017.
The Non-Party movants have not filed any documentation which evidences
a resignation or other change of authority at [NCL].").)
Indeed, DHL has
submitted

the

declaration

of

Mr.

Michail

Zolotas

himself,

who

states

that:

(1) he has "been and remain [s] the President and Director of [NCL] since its
formation in July 2014;" and (2) that "Mrs. Anna Zolota was appointed as the
CEO, President, Chairman of the Board and Class I Director" of Newlead
26

flow resulting from the seizure of

situation

of

mistake,

carelessness,

or

[the Vessel]," this

inadvertence,

faultless

omission,

surprise,
but

rather

is

not a

indifference,
a

choice

as

to

where to prioritize the expenditure of allegedly limited funds.
See Fed. R. Civ.

388

("The

simple,

Ato

to

of

undone

carelessness.'

The

Servs.

^neglect'

a matter,

leave

or,

or

word

Dictionary

791

Ackermann

be

v.

an

end

to

is

507 U.S.

*to

little

the point

unattended
therefore

give

to

at

for

especially

encompasses

more commonly,

both

omissions

(quoting Webster's Ninth New Collegiate

(1983))

United

Co.,

closer to

faultless omissions to act and,

caused by carelessness."

must

Pioneer Inv.

meaning

respect'

purposes,

through

60(b)(1);

ordinary

attention or

our

P.

(alterations

States,

340

litigation

U.S.

omitted));
193,

someday,

198

and

see

(1950)

free,

also
("There

calculated,

deliberate choices are not to be relieved from.").

As

to Defendants'

alleged lack of

circumstances
outside

of

where

to

cash flow and failure to

of

their

inadvertence,

culpability for its inaction,

their

own making as

control;

indifference,

prioritize

the

again,
or

retain new counsel are

opposed to

this

was

carelessness,

expenditure

of

Defendants'

not
but

funds.

a circumstance
a

situation

of

a

choice

as

to

it

is

Indeed,

Holdings Ltd.

during his absence from that company from October 19 through

December

2016.

23,

(Zolotas

Decl.,

Doc.

118-6,

II

1-4.)

Mr.

Zolotas

provides no insight as to why NCL took no action to retain counsel or
otherwise defend against Plaintiffs' motion for summary judgment.
(See id.,
generally.)
27

Defendants'

failure

that

them

landed

for

their

83.)
in

prior

Finally,

good

there

deadline

their

instant

lawsuit

been

no

for

to do

summary

Defendants

neglect;
the

to

can

Plaintiffs'

again

therefore,
delayed

so.

In sum,

judgment

and

is

failure
that

that

grounds

1,

to

40,

was

left

DHL as

their

was

a

simply

deliberate

upon

an

with

not

a

choice

Defendants

examination of

the

firm

judgment

motion;
have

factors

priority

opposed

the

of

in

this

that

action

nonappearance

and

to

into

motion
for

the

excusable

record as

their purported assignee -

participation

not

case despite having

high

conviction

made

comply with the

relevant

as

41,

respond was

Defendants

in this

taking all

the

Docs.

summary

only note

obligations

i t is clear that responding to Plaintiffs'

indeed,

Court

(See

was

retain new counsel or otherwise

Court

consideration,

and

showing

had new counsel enter an appearance

ample time

financial

withdrawal.

has

respond

the

pay

to whether Defendants'

to

rather,

the

counsels'

any attempts

to

timely

into

as

faith,

to

a

Defendants

whole,
-

and

have unnecessarily
and

exhibited

a

significant

history

unresponsiveness.

Accordingly,

the Court exercises its calm discretion and denies

DHL's alternative Rule 60(b)(1) motion.22
22 While not argued by DHL,
Rule

60(b)(6)

because

it

DHL would not be entitled to relief pursuant to
has

failed

to

demonstrate

extraordinary or compelling as to require relief.
Fresh Produce N.A.,
Inc., 741 F.3d 1349, 1355

circumstances

so

See Aldana v. Del Monte
(11th Cir. 2014)
("Rule

60(b)(6) provides a catch-all, authorizing a court to grant relief from a
judgment for 'any other reason that justifies relief . . . . [but motions
under

that

Rule]

must

demonstrate

that

extraordinary to warrant relief . . .
28

the

[a]

circumstances

are

sufficiently

justification so compelling that

C.

Defendants'

Counterclaim for Wrongful Arrest

& DHL's Response to the Order to Show Cause
In the Summary Judgment Order,

to

show

against
this

cause

in

favor

dated
DHL,

then

that:

Court

2016

(doc.

assignee

directive

grant

assert

of

as

an

summary

that,

once

on each

their

denied

the

Vessel

in

and

(iii)

the

of

64,

at

of

NCL's

judgment
Court

the

Vessel

2-5).

to

in

(Doc.

relevant
attack

favor

vacates

against

its

Court
its

116,

the

of

Plaintiffs
decision

had

Order

at

basis

for

Order

interests,

of

its

in

and
been

damages

of

arrest

had

claims

7-8);

at

arrest

prejudice

judgment

previously

invitation

the

of

wrongful

with

summary

arrest

47,

(doc.

dismissed

(i)

had

initial

2016

purported

this

Court's

the

4,

be

Plaintiffs

Plaintiffs'

August
as

taken

14,

counterclaim for

not

alleged wrongful

July

reinstated

given
of

(ii)

Plaintiffs'

why their

should

closed

Defendants;

dated

to

Plaintiffs

case

entered

as

the Court ordered Defendants

on

18.)
has
the

and
the

grant of summary judgment and relieves DHL of the facts admitted
by

Defendants'

failure

to

respond

to

Plaintiffs'

motion

for

the district court was required to vacate its order." (internal quotations,
citations, and alterations omitted); see also Doe v. Drummond Co., 782 F.3d
576, 612 (11th Cir. 2015) ("To warrant relief under Rule 60(b)(6), not only

must Plaintiffs show 'sufficiently extraordinary' circumstances,
'that absent such relief, an extreme and unexpected hardship will

(quoting Galbert v.
2013)))/

United

W. Caribbean Airways,

States

v.

Alpine

Land

715 F.3d 1290,

& Reservoir

Co.,

1294-95
984

F.2d

but also
result.'"

(11th Cir.
1047,

(9th Cir. 1993) ("Although the timeliness of a Rule 60(b)(6) motion
on the facts of each case, relief may not be had where the party
reconsideration has ignored normal legal recourses. . . . Rule
relief normally will not be granted unless the moving party is able

1049

depends
seeking
60(b)(6)
to show

both injury and that circumstances beyond its control prevented timely action
to protect its interests.").
29

summary judgment,
fact

as

Doc.

125,

of the

to

there would exist a genuine issue of material

Defendants'

9-10.)

Court's

counterclaim.

This,

however,

directive;

clear

in

the

Summary

show,

in

light

of

the

Doc.

118,

at

22-25;

the purpose

or

intent

was

not

the

rather,

Judgment

(See

Court's

Order

-

aforementioned

was

command -

for

rulings

motion,

Defendants

Accordingly,
arrest

of

because
the

have

Vessel was done

basis

for

arrest

is

were

failed

facts

summary judgment

untenable

F.2d

principle

of

faith."

to

411

Panama

(11th

maritime

provided

297

failed

upon

have

establish

Defendants'

v.

to

which

been

that

law

he

(5th

Cir.

Energy

1988)

Plaintiffs'
and
the

that

one

who

is

wrongful

Furness

Assocs.,

an

suffers

Withy

Inc.,

established

a

wrongful

from the party who obtained the

prove

that

such

party

Frontera Fruit Co.

1937)

of

any other

for

See

("It

so.

arrest

the

Sys.

do

sustained

counterclaim

World

Cir.

(citations omitted));

293,

claims

premised

attachment may recover damages

attachment,

have

and due to be dismissed.

Inc.,

410,

DHL

in bad faith or otherwise demonstrate

liability,

(Chartering),

and

Plaintiffs'

Vessel

Defendants/DHL

F.2d

the

to

how their counterclaim for wrongful arrest could survive

dismissal.

854

Defendants
and

admitted by their failure to oppose Plaintiffs'

as made

("The

gravamen

acted

in

v. Dowling,

of

the

right

bad
91
to

recover damages for wrongful seizure or detention of vessels is
the

bad

faith,

malice,

or

gross
30

negligence

of

the

offending

party.

.

.

.

[T]he advice of competent counsel,

and acted upon
action

for

Corp.

v.

(5th

Cir.

there

in good

malicious

Raider

2015)

("To

be

and

2)

[sic]

negligence

on

the

quotations,

no

bona

a

In

judgment

Plaintiffs'

its

in

Summary

favor

a

fide

of

see

claim of

of

the

bad

also
792

wrongful

footnotes,
C(l)(b);

complete defense

L.L.C.,

for

showing

part

P.Supp. Adm. R.

D.

alone

Logistics,

recover

citations,

R. Civ.

(1)

is

prosecution.");

Marine

must

vessel

faith

honestly sought

a

Comar

F.3d

arrest
maritime

faith,

offending

574-75

a

vessel,

lien

malice,

on

or

party."

§

the

gross

(internal

and alterations omitted));

46 U.S.C.

an

Marine,

564,

of

to

Fed.

31325(b)(1).

Supplemental Briefing & Amounts Due

Judgment

of

Order,

Plaintiffs,

after

the

entering

Court

directed

summary

them

to

perfect the record with admissible evidence with regards to the
balance

of their

claims

against

Defendants

that Order (i.e., March 20, 2017).23
23

In

the

Summary

Judgment

Order,

the

through the

date

of

Plaintiffs have done so.24

Court

concluded

that

"Defendants'

default on the terms of the respective Mortgages entitles Plaintiffs to
foreclose on the Vessel up to the maximum of the amount secured thereby
pursuant to 46 U.S.C. § 31325."
(Doc. 116, at 14.)
The amount secured by

Ray's Mortgage is $1,861,412.00 plus interest, expenses and costs.
(Doc. 186, at 2-30, 14.)
The amount secured by Cheyenne's Mortgage is $1,009,315.00
plus interest, expenses and costs.
(IcL at 157-85, 14.) The amount secured
by Oppenheim's Mortgage is $2,547,900.00 plus interest, expenses and costs.
(Id.
at
64-93,
1
4.)
The amount
secured by Labroy's Mortgage is
$1,215,000.00 plus interest, expenses and costs.
(Id. at 122-53, 14.).
24 In their supplemental briefing and evidence submitted in support thereof,
Plaintiffs demonstrate that they are respectively owed, through March 20,
2017:
(a)
as to Ray Capital,
$1,086,658.00 in unpaid principal and
$721,523.00 in accrued interest; (b) as to Cheyenne Holdings, $1,000,000.00

in unpaid principal and $252,055.00 in accrued interest;
31

(c) as to Oppenheim

(See

have

Docs.

117

challenged

submitted in

forth

& 117-1.)

in

properly

Oppenheim

judgment

it,

Capital,

against

foreclose

on

$1,252,055.00,

Judgment

Order

Plaintiffs

Ray

and

Labroy

Proceeds

$3,156,794.00,

the

foregoing

and

Defendants

and
in

or

are

the

the

for

the

based

Capital,

Shiptrade

-

-

III.

Upon

Accordingly,

Defendants

the

neither

calculations

thereof.

Summary

before

date,

Plaintiffs'

support

the

To

on

reasons

the

therefore
of

and $1,534,229.00,

IT

intervention
is

DENIED

pursuant

to

to

IS

FURTHER

(doc.

118)

the

due

ORDERED

extent

Rule

24 (a) ,

that

DHL's

that

motion

to

respectively.

that

IT

it

is

is

a

renewed

PART,

IN

DENIED

motion

GRANTED to

for

the

for

reconsideration

IS

HEREBY

(doc.

DHL's

motion for substitution pursuant to Rule 25(c).25
ORDERED

final

$1,808,181.00,

consideration,

GRANTED

but

to

CONCLUSION

and

is

evidence

entitled

ORDERED that DHL's original motion for intervention
DENIED.

set

Holdings,

entitled

amounts

DHL

evidence

Cheyenne

are

nor

80)

motion

IN

is
for

PART;

it

intervention

extent

it

is

a

IT IS FURTHER
(doc.

118)

is

Capital,
$2,499,956.00 in unpaid principal and $656,838.00 in accrued
interest; and (d) as to Labroy Shiptrade, $1,215,000.00 in unpaid principal
and $319,229.00 in accrued interest.
(See Doc. 117-1.)
25 The Clerk is DIRECTED to add DHL as an additional

substitution

is

made

with

the

express

understanding

that

defendant.

DHL's

rights

This

and

obligations upon being added to this case are derived from those rights and
obligations purportedly assigned to it by NCL and nothing more.
32

DENIED.26
for

IT

IS

Wrongful

PREJUDICE.
favor

Arrest
The

of

FURTHER ORDERED
(see

Clerk

Plaintiffs

follows:

(1)

in

doc.

is
on

that

31,

at

DIRECTED
their

favor

Defendants'
12-15)

to

claims

of

enter

is

DISMISSED WITH

final

against

Plaintiff

Counterclaim

judgment

Defendants

Ray

Capital

in
as

Inc.,

$1,808,181.00;

(2)

in favor of Plaintiff Cheyenne Holdings Ltd.,

$1,252,055.00;

(3)

in favor of Plaintiff Oppenheim Capital Ltd.,

$3,156,794.00;

and

Limited,

(4)

in

$1,534,229.00.27

favor

of

Plaintiff

Labroy

Shiptrade

The Clerk is ORDERED to disburse the

funds remaining in registry of the Court in connection with this
case

in

the

Plaintiffs'

provided

manner

and

escrow

directly

separate cover.28

amounts

account,

to

the

described

the

Clerk

details

by

above

to

of

which

Plaintiffs'

counsel

shall

counsel

for

be

under

The Clerk is further DIRECTED to TERMINATE all

other pending motions,

if any, and CLOSE this case.

26 DHL has also filed a "Motion for Hearing and to Extend 45 Day Stay Pending
Determination on Pending Motions."
(Doc. 121.)
Because the Court concludes
that there is no need for oral argument in this matter and has resolved all
pending motions before it with relation to the present action and the DHL
Action, DHL's motion (doc. 121) is DENIED AS MOOT.
See LR 7.2, SDGa.
("Motions shall generally be determined upon the motion and supporting
documents filed as prescribed herein.").

27 Any deficiency in funds to be collected from the funds held in the Court's
registry in relation to this matter must be borne first by Labroy (followed,
if necessary, by Oppenheim, then Cheyenne, and finally Ray).
(See Doc. 116,
at

17 n.

15.)

28 While the Court indicated in its Summary Judgment Order that it intended to

temporarily stay the execution of judgment in this matter for forty-five days
from the date of its entry so as to allow DHL to seek an order from the
Eleventh

Circuit

pending appeal

further

staying

execution

in

connection

with

DHL's

then-

(see doc. 116, at 17-18), that appeal has concluded and all

other motions, filings, and other issues in this action have been resolved.
Accordingly, the Court no longer intends to - and therefore will not order
the Clerk - to stay execution of the forthcoming final judgment other than as
33

ORDER ENTERED at Augusta, Georgia, this
September,

j3^ day of

2017.

J / RANBAprHALE, CtflE/F JUDGE
UNITED/STATES
SOUTHERN

required by the automatic fourteen

(14)

imposed by Rule 62(a).
34

DISTRICT

DISTRICT

OF

COURT

GEORGIA

day stay of execution of judgment