Essex Crane Rental Corp v. DB CROSSMAR 14, et al
ORDER AND REASONS: IT IS ORDERED that the 82 motion for an extension is DENIED as set forth in document. Signed by Judge Ivan L.R. Lemelle on 3/13/2017. (mmv)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
ESSEX CRANE RENTAL CORP.
DB CROSSMAR 14, ET AL.
ORDER AND REASONS
Before the Court is “Cross Maritime, Inc. and Cross Holdings,
Inc.’s Motion to Extend Time to Respond to Wells Fargo Equipment
Finance, Inc.’s Motion for Summary Judgment, and to Extend Time to
Object to Evidence.” Rec. Doc. 82. Intervenor Wells Fargo Equipment
Finance, Inc. (“Wells Fargo”) timely filed a response memorandum.
Rec. Doc. 86. For the reasons discussed below,
IT IS ORDERED that the motion for an extension (Rec. Doc. 82)
On October 20, 2016, this Court recognized a mortgage held by
$7,119,195.22. Rec. Doc. 66 at ¶ 2. On October 28, 2016, after
previously granting a motion to set sale of the vessel owned by
Cross, the vessel was sold to Wells Fargo for $2,497,500.00, three
quarters of its appraised value. Rec. Docs. 68; 77-3 at 4.
On February 14, 2017, Wells Fargo filed a motion for summary
judgment and set the motion for submission on March 1, 2017. Rec.
Cross Maritime, Inc. and Cross Holdings, Inc. will hereinafter be referred to
collectively as “Cross.”
$4,839,375.20 plus interest at the rate of 12%, $335,621.17 plus
interest at the federal judicial rate, reasonable attorneys’ fees
and costs, and asks this Court to confirm the Master Security
Agreement at issue. Id. at 1. Pursuant to Local Rule 7.5, an
opposition memorandum was due no later than February 21, 2017.
However, Cross waited until February 28, 2017 to file a motion for
an extension of time within which to respond. Rec. Doc. 80. This
motion was marked deficient. Id. On March 1, 2017, Cross then
filed the instant motion for an extension, set for submission on
March 29, 2017. Rec. Doc. 82. The Court
set the motion for
submission on March 8, 2017 and informed the parties that any
opposition to the motion had to be filed no later than March 6,
2017. Rec. Doc. 85. Wells Fargo
timely filed its opposition
memorandum. Rec. Doc. 86.
In its motion for an extension, Cross claims that it needs
calculate the value of the DB CROSSMAR 14.” Rec. Doc. 82 at 1. It
further argues that an accurate valuation of the vessel would take
into account “the cyclical business trends of the oil and gas
industry” and that giving it until March 29, 2017 to respond would
not interfere with this Court’s March 31, 2017 motion deadline.
Id. at 2; see also Rec. Doc. 82-1 at 2.
Under Federal Rule of Civil Procedure 6(b)(1)(B), a court
may, for good cause, extend the time within which an act must be
done “on motion made after the time has expired if the party failed
to act because of excusable neglect.”
Because congress has provided no other guideposts for
determining what sorts of neglect will be considered
‘excusable,’ we conclude that the determination is at
bottom an equitable one, taking account of all relevant
circumstances surrounding the party’s omission. These
include . . . the danger of prejudice . . . , the length
of the delay and its potential impact on judicial
proceedings, the reason for the delay, including whether
it was within the reasonable control of the movant, and
whether the movant acted in good faith.
Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’ship, 507 U.S.
380, 395 (1993) (citations omitted) (discussing the meaning of
“excusable” neglect in the context of Federal Rule of Bankruptcy
Procedure 9006(b)); see also Agee v. City of McKinney, Tex., 593
F. App’x 311, 314 (5th Cir. 2014) (“In evaluating ‘excusable
neglect,’ a court considers ‘(1) the possibility of prejudice to
the other parties, (2) the length of the applicant’s delay and its
impact on the proceeding, (3) the reason for the delay and whether
it was within the control of the movant, and (4) whether the movant
has acted in good faith’”) (citations omitted); Chaney v. New
Orleans Pub. Facility Mgmt., Inc., No. 96-4023, 1998 WL 87617, at
*2 (E.D. La. Feb. 20, 1998) (noting that “the Pioneer Court
recognized that ‘inadvertence, ignorance of the rules, or mistakes
neglect’”) (citing Pioneer, 507 U.S. at 392). “Even if good cause
and excusable neglect are shown, it nonetheless remains a question
of the court’s discretion whether to grant any motion to extend
time under Rule 6(b).” McCarty v. Thaler, 376 F. App’x 442, 443
(5th Cir. 2010) (citations omitted).
Here, Cross maintains that an extension would not prejudice
Wells Fargo because (1) Wells Fargo has already assumed ownership
of the vessel and (2) the dispositive motion deadline is not until
March 29, 2017. Rec. Doc. 82-1 at 3. On the other hand, Wells Fargo
notes that the deadline to file witness and exhibit lists and for
Defendant to deliver expert reports was February 20, 2017, but
Cross did not file any such lists or exchange any expert reports
with Wells Fargo. Rec. Doc. 86 at 3. Further, Wells Fargo believes
that Cross is using this motion as a delay tactic, especially
considering that Cross has not made a payment on its indebtedness
to Wells Fargo since August 26, 2016 and that there is no evidence
that the pre-sale appraisal does not reflect the vessel’s fair
market value. Id. at 4-5.2
Cross makes conclusory allegations that the pre-sale appraisal does not
represent the vessel’s true value because “Wells Fargo . . . sought to take
advantage of depressed market conditions in the oil and gas industry.” Rec.
Doc. 82-1 at 3. “The deficiency owing under a mortgage is calculated by
establishing the difference between the total outstanding obligation and the
‘fair market value’ [at the time of sale] of the vessel involved.” EnSerCo,
L.L.C. v. Drilling Rig Noram 253, 126 F. Supp. 2d 443, 446 (S.D. Tex. 2000)
(citing Bollinger & Boyd Barge Serv., Inc. v. Motor Vessel, Captain Claude Bass,
576 F.2d 595, 598 (5th Cir. 1978)). While the price obtained at a fairly
conducted sale may generally be considered fair market value, an offset may be
used where there is a showing of a “probable significant disparity between the
sales price of the property and its fair value.” Id. (citations omitted). See
Cross further argues that, by setting the motion for summary
judgment for submission ahead of the dispositive motion deadline
in the Scheduling Order, Wells Fargo gave Cross only seven days
within which to obtain a counter-appraisal. Rec. Doc. 82-1 at 34. In response, Wells Fargo maintains that, between the time that
it obtained the required appraisal before the October 24, 2016
sale and the time it filed its motion for summary judgment, “Cross
had four months . . . to retain an expert to prepare an appraisal
of the vessel if it disagreed with the appraised value . . . .”
Rec. Doc. 86 at 3 (emphasis in original).
The only reason that Cross apparently provides to explain its
late filing is that the parties were actively negotiating before
and after Wells Fargo filed its motion for summary judgment; but
it was not until February 27, 2017 that Wells Fargo informed Cross
that it would not agree to extend the pretrial deadlines. Rec.
Doc. 82-1 at 4-5. It was the following day, February 28, 2017,
that Cross filed its original, deficient motion for an extension.
Id. at 5.
also Walter E. Heller & Co. v. O/S Sonny V., 595 F.2d 968, 972 (5th Cir. 1979)
(finding an abuse of discretion where the vessel was sold to the creditor for
$35,000, but, in opposition to the sale, the opponents submitted an affidavit
showing that the appraised value of the vessel was $118,000 and informed the
court that the creditor resold the vessel for $52,000). Though there is a “need
for heightened scrutiny . . . when . . . the property is sold to the foreclosing
creditor,” as in this case, (id. (citing Walter E. Heller & Co., 595 F.2d at
972)), Cross was given an opportunity to object to the sale before the sale was
confirmed by this Court on November 9, 2016 (see Rec. Doc. 70).
The fact remains that Cross could have filed a motion for an
extension before the deadline for filing an opposition passed.
That the parties were attempting to settle their claims outside of
Court does not excuse Cross’s failure to abide by this Court’s
deadlines. Further, the pre-sale appraisal took place more than
four months ago and Cross had more than sufficient reason to know
that Wells Fargo would subsequently rely on this
appraisal during the litigation. If Cross intended to contest the
appraisal in good faith, it presumably would have retained an
expert before the deadlines for exchanging expert reports and
filing witness lists passed. Cross also failed to provide the Court
with any persuasive evidence that the appraisal relied on by Wells
Fargo was deficient. Instead, Cross’s motion for an extension makes
conclusory allegations about the vessel’s value and points the
Court to its own assessment of the vessel’s “replacement value.”
Because Cross failed to take any reasonable steps to ensure
that Wells Fargo’s motion for summary judgment was not granted as
unopposed, it is reasonable to find that it now moves for an
extension solely to delay and further prejudice the inevitable.
See, e.g. Agee, 593 F. App’x at 314 (finding there was no abuse of
discretion where the district court refused to grant an extension
of time to respond to a motion for summary judgment after the party
waited to request an extension until eighty-eight days after the
deadline); McCarty, 376 F. App’x at 444 (finding no abuse of
discretion where the court granted the first, timely-filed motion
for an extension, but denied a subsequent, untimely motion for an
extension, despite the party’s claims of a prison power outage);
Draper v. KK Ford, LP, 196 F. App’x 264, 265 (5th Cir. 2006)
(finding no abuse of discretion where the district court denied a
expiration of the deadline, because “[a] busy practice does not
constitute excusable neglect”); Gillespie v. B L Dev. Corp., 67 F.
App’x 243 (5th Cir. 2003) (finding no abuse of discretion where an
extension, filed fourteen days after a response was due, was
Regardless of [Cross’s] intentions, or inattention,
which led to the flouting of discovery [and response]
deadlines, such delays are a particularly abhorrent
feature of today’s trial practice. They increase the
cost of litigation, to the detriment of the parties
enmeshed in it; they are one factor causing disrespect
for lawyers and the judicial process; and they fuel the
increasing resort to means of non-judicial dispute
resolution. Adherence to reasonable deadlines is
critical to restoring integrity in court proceedings.
Geiserman v. MacDonald, 893 F.2d 787, 792 (5th Cir. 1990) (finding
no abuse of discretion in the lower court’s decision to strike a
IT IS ORDERED that the motion for an extension (Rec. Doc. 82)
New Orleans, Louisiana, this 13th day of March, 2017.
SENIOR UNITED STATES DISTRICT JUDGE
Cross also objects to the Declaration of Douglas Hein attached to Wells Fargo’s
motion for summary judgment, because the affidavit was unsigned. However, on
March 1, 2017, Wells Fargo moved to attach a signed copy of the affidavit to
the motion for summary judgment, and on March 2, 2017, this Court granted the
motion. Rec. Docs. 81, 84. Accordingly, Cross’s objection is moot.
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