Meyers Warehouse, Inc. v. Canal Insurance Company
Filing
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ORDER AND REASONS denying 44 Motion for Reconsideration. Signed by Judge Stanwood R. Duval, Jr on 10/10/2014. (my)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
MEYERS WAREHOUSE, INC.
CIVIL ACTION
VERSUS
NO. 12-2948
CANAL INSURANCE COMPANY
SECTION “K”(2)
ORDER AND REASONS
Before the Court is a “Motion to Reconsider Granting of Motion for Summary Judgment”
filed by Plaintiff, Meyers Warehouse, Inc. (“Meyers”). (R. Doc. 44). In its Memorandum, the
Meyers requests that the Court reconsider its ruling granting the Defendant, Canal Insurance
Company (“Canal”), summary judgment, ostensibly on two grounds: (1) the insurance policy at
issue is ambiguous and the contract should be interpreted in favor of Meyers (and against the
insurer, Canal); and (2) the common fund doctrine applies to the “gap” in the Policy language as
to when the duty to defend arises and the Court should find that the duty to defend arises upon
notice of a “claim” or “loss” rather than upon filing of a “suit.” (Pl. Mem. Supp. Motion
Reconsideration 6-8, R. Doc. 44). Opposing the motion, Canal correctly notes that Meyers “cites
no rule under which the motion is brought.” (Def. Mem. Opp. 1, R. Doc. 45). But, assuming that
the motion is brought pursuant to Federal Rules of Civil Procedure rule 59(e), Canal asserts that
Meyers presents no manifest error of law or fact in the Court’s opinion, merely rehashing its
original argument, and makes an additional argument as to the common fund doctrine which was
not raised prior to the instant motion and is not applicable to facts at hand. Id. at 2-4. In Reply,
Meyers avers that its intent was not to bring a motion pursuant to Rule 59(e), but to request that
the Court reconsider its Order in light of the contractual language or common fund doctrine and
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“asks the Court to treat this Motion, as a Motion for New Trial under Federal Rules of Civil
Procedure 59(b).” (Pl. Reply 1, R. Doc. 50.)
It is well-established that “[t]he Federal Rules do not recognize a ‘motion for
reconsideration’ in haec verba.” Lavespere v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167,
173 (5th Cir. 1990) abrogated on other grounds by Little v. Liquid Air Corp., 37 F.3d 1069, 1076
n.14 (5th Cir. 1994) (citations omitted); Anderson v. Red River Waterway Com’n, 16 F. Supp.2d
682 (W.D.La. 1998) (citing United States v. Emmons, 107 F.3d 762, 764 (10th Cir. 1997)) (“The
Federal Rules of Civil Procedure do not provide a mechanism with which a party may file a
‘motion to reconsider.’”). However, a motion to reconsider a judgment is treated by the courts as
a Rule 59(e) motion to alter or amend that judgment when filed within the time limits imposed
by the Rule. Edward H. Bohlin Co. v. Banning Co.l, 6 F.3d 350 (5th Cir. 1993). If the motion is
served within twenty-eight days of the rendition of the judgment, it is evaluated under Rule
59(e). See Fed. R. Civ. P. 59(e); Lavespere, 910 F.2d at 173. Here, Meyers’ motion was filed
exactly twenty-eight days from the rendition of the judgment on August 6, 2014. (Order, August
6, 2014, R. Doc. 40). Although Meyers requests that its motion be treated as a Motion for New
Trial under Rule 59(b), the Court fails to see the applicability of that section as no trial ever
occurred and construes the instant motion as a motion to alter or amend judgment under Rule
59(e).
A Rule 59(e) motion calls into question a judgment’s correctness. In re Transtexas Gas
Corp., 303 F.3d 571, 581 (5th Cir. 2002). A party may bring a motion under this section on
three possible grounds: (1) an intervening change in controlling law; (2) the availability of new
evidence not previously available; or (3) the need to correct a clear error of law or prevent
manifest injustice. In re Benjamin Moore & Co., 318 F.3d 626, 629 (5th Cir. 2002). In Castrillo
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v. American Home Mortg. Servicing, Inc., Judge Vance succinctly stated a court’s relevant
considerations under Rule 59(e):
A district court has considerable discretion to grant or deny a Rule 59(e) motion for
reconsideration. In exercising its discretion, the Court must “strike the proper balance”
between the need for finality and “the need to render just decisions on the basis of all the
facts.” Reconsideration, however, “is an extraordinary remedy that should be used
sparingly.” Reconsideration “serve[s] the narrow purpose of allowing a party to correct
manifest errors of law or fact or to present newly discovered evidence.”
2010 WL 1838061 at *1 (E.D.La. 2010) (citations omitted). However, Rule 59(e) motions are
“not the proper vehicle for rehashing evidence, legal theories, or arguments that could have been
offered or raised before the entry of judgment.” Templet v. HydroChem, Inc., 367 F.3d 473, 47879 (5th Cir. 2004).
A review of Meyers’ Memorandum and Reply evidences no change in the controlling law
nor presentation of evidence not previously available. Meyers instead argues that the Court erred
in its interpretation of the insurance policy. Meyers asserts that the insurance policy at issue is
ambiguous rather than unambiguous—very clearly rehashing the same general argument
previously advanced with only minor alterations. Specifically, Meyers argues that under Section
IV 2(A) of the Policy, the Policy states that Canal has “no duty to provide coverage,” which
Meyers’ argues includes the duty to defend, until it is notified of the “‘accident’ or ‘loss’” in the
event “of ‘accident,’ claim, ‘suit’ or ‘loss.’” 1 Though Meyers states in a footnote that “[m]any
claims are settled prior to suit and require a defense to settle—exactly like the case at hand,”
Meyers offers no case law in support of that statement much less show any error in the Court’s
conclusion.2 The Court once determined that the language of the policy is clear as to when the
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Policy Ex. 2 Section IVA(2) at 45, R. Doc. 15 (emphasis added).
Pl. Mem. 4 n.1. In its prior opinion, the Court offered examples of case law addressing the issue of when a “suit”
was filed thus triggering the duty to defend in an effort to demonstrate that the issue is not uncommon and that
contracts may define when “suit” is filed to forestall future legal issues as to when the duty to defend arose. Indeed,
as a practical matter, “[w]hen determining whether a liability insurer has a duty to defend, the first inquiry is
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duty to defend arises under the contract; the Court rejected Meyers’ argument as to ambiguity
once before and will not entertain it again. The Court also notes that, in advancing its argument,
Meyers fundamentally misconstrues the Court’s Order and Reasons: the Court here reiterates that
it did not opine that the duty to provide coverage encompasses the duty to defend as Meyers
suggests in its statement that “[t]he Policy states that CANAL must provide coverage (which this
Court has correctly identified as the duty to defend and the duty to indemnify).”3
As to Meyers’ assertion that the common-fund doctrine applies to the “gap” in the
ambiguous policy, the Court notes, first, that this legal theory was not brought before the Court
in any form in any prior filing; thus it is not appropriately raised at this time under Rule 59(e).
Assuming arguendo that the argument was properly raised, it is not clear that the common-fund
doctrine applies in this instance. Louisiana case law recognizes an exception to the general rule
that an attorney’s right to remuneration for services is dependent upon a contract where the
attorney “alone and at his own expense has successfully maintained an action for the
preservation, protection, increase or creation of a fund in which persons other than his own
clients may share or from which they may benefit.” Avants v. Kennedy, 2002-0830 (La. App. 1
Cir. 12/20/02), 837 So. 2d 647, 656 writ denied, 2003-0203 (La. 4/4/03), 840 So. 2d
whether a ‘suit’ exists.” See Eliot M. Harris, The Duty to Defend: What Insurers, Insureds, And Their Counsel Need
To Know When Faced With A Liability Coverage Dispute – ABA YLD 1001 Practice Series, AMERICAN BAR
ASSOCIATION (Oct. 8, 2014, 9:20 a.m.).
http://www.americanbar.org/groups/young_lawyers/publications/the_101_201_practice_series/duty.html
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Though Meyers does not cite to the portion of the Court’s Order and Reasons for support of its statement, the
Court assumes that Meyers refers to the following statement referencing the duty to provide coverage: “Specifically,
the policy provides that Canal’s liability coverage gives them the ‘right and duty to defend against any “insured”
against a “suit” asking for damages or a “covered pollution cost or expense”’ to which the insurance applies.”
(Order, August 6, 2014, at 2, R. Doc. 40). Here, the Court summarized Canal’s argument and referred to Section II
of the Policy entitled “Liability Coverage,” which contained the language applicable to the duty to defend.
Elsewhere, the Court stated: “The question placed at issue by Canal’s motion is not one of ‘coverage’ but one of
whether Canal has the ‘duty to defend’ and thus the obligation to pay for legal expenses resulting from the
investigation and settlement of a claim against the insured.” (Order, August 6, 2014, at 5, R. Doc. 40). Stated
differently, the issue in the case was whether Canal had the duty to defend when no suit had been filed but only an
investigation was conducted and the potential claim was settled by parties other than the insured. In no way did the
Court intend either statement to imply that the duty to defend is subsumed by the duty to provide coverage.
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1215(emphasis added). Meyers does not suggest what common fund was preserved, protected,
increased, or created by Meyers’ counsel here and the Court cannot fathom that any such fund
would exist in this case; Meyers’ counsel may have taken measures to prevent a personal loss
incurred by Meyers, but these actions did not result in a third-party recovery or preserve an
existing common fund. See Kirkpatrick v. Young, 456 So.2d 622, 625 (La. 1984) (finding that
judicial recognition of the invalidity of a will did not preserve, protect, increase, or create a
common fund and that the common fund doctrine did not apply). Thus, the Court finds that this
ground does not establish that reconsideration of the Court’s prior ruling is warranted.
Accordingly,
IT IS ORDERED that the Plaintiff’s “Motion to Reconsider Granting of Motion for
Summary Judgment” (R. Doc. 44) is DENIED.
October
New Orleans, Louisiana, this _____ day of ________________, 2014.
10th
________________________________
STANWOOD R. DUVAL, JR.
UNITED STATES DISTRICT JUDGE
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