Hudson Specialty Insurance Company v. Talex Enterprises, LLC et al

Filing 103

ORDER denying 98 99 Motion for Reconsideration. Signed by Honorable David C. Bramlette, III on August 15, 2018 (JBR)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
WESTERN DIVISION
HUDSON SPECIALTY INSURANCE COMPANY

PLAINTIFF

V.

NO. 5:17-CV-137-DCB-MTP

TALEX ENTERPRISES, LLC,
JUBILEE PERFORMING ARTS CENTER, INC.,
TERRANCE L. ALEXANDER, and the
BOARD OF MAYOR AND SELECTMEN
OF MCCOMB, MISSISSIPPI, et al.

DEFENDANTS

ORDER AND OPINION

Faraway,
dismissing
Hudson

LLC

moves

without

Specialty

the

prejudice

Insurance

Court

to

Faraway’s

Company

for

reconsider

its

counterclaims
breach

of

order
against

contract,

tortious breach of contract, and gross negligence. For the reasons
that follow, the motion is DENIED.
I
The Court may revise an interlocutory order at any time for
any reason before it enters final judgment. FED. R. CIV. P. 54(b);
United States v. Renda, 709 F.3d 472, 479 (5th Cir. 2013).

The Court’s order granting Hudson’s motion to dismiss did not
adjudicate all of Faraway’s counterclaims or decide the rights and
liabilities of all parties. It is therefore interlocutory. FED. R.
CIV. P. 54(b).
Requests to reconsider interlocutory orders under Rule 54(b)
involve some of the policies behind Rule 59(e) requests to alter
or amend an order or judgment. Hillie v. Williams, Civ. A. No.
4:17-CV-69-DMB-DAS, 2018 WL 280531, at *2 (N.D. Miss. Jan. 3,
2018). So courts apply the Rule 59(e) standard to Rule 54(b)
motions

to

reconsider.

See

eTool

Development,

Inc.

v.

Nat’l

Semiconductor Corp., 881 F. Supp. 2d 745, 748 (E.D. Tex. 2012)
(collecting cases).
Applying that standard here, the Court declines to reconsider
its order. Faraway has neither “clearly established” that the
Court’s

ruling

discovered,

was

“manifestly

relevant

evidence

erroneous”
or

nor

offered

authority

newly-

justifying

reconsideration. Schiller v. Physicians Resource Grp., Inc., 342
F.3d 563, 567 (5th Cir. 20013). The cases Faraway cites do not
address the legal conclusion that supplied the basis for its
counterclaims: That Talex’s submission of a proof of loss triggered
Hudson’s obligations to Faraway under the policy’s union mortgage
clause.

2

II
Faraway’s motion and supporting brief suggest that Faraway
misreads the Court’s order. The Court emphasizes three points.
First, the Court’s dismissal was without prejudice. That
means that Faraway may move to amend. See Bracey v. City of
Jackson, Miss., Civ. A. No. 3:16-CV-657-DPJ-FKB, 2017 WL 1086117,
at *3 n.1 (S.D. Miss. Mar. 20, 2017). Faraway’s request that the
Court “allow” it to file an amended counterclaim suggests that
Faraway

wrongly

concludes

that

the

Court

dismissed

its

counterclaims with prejudice.1
Second, the Court dismissed three of Faraway’s counterclaims
because they rested on the same theory. That theory reasoned that
Hudson

breached

union

mortgage

clause-derived

obligations

to

Faraway that arose when Talex submitted its proof of loss to
Hudson. And that theory depended on Faraway’s allegation that
Talex’s

submission

of

a

proof

of

loss

triggered

Hudson’s

obligations to Faraway under the policy’s union mortgage clause.
That allegation is really a legal conclusion, and one that is
incorrect

as

a

matter

of

law.

Because

three

of

Faraway’s

Faraway’s assertion that it “should not have to be compelled to pursue
the claims process rather than being allowed to pursue its claims of breach of
contract” confirms that it misreads the Court’s order. (Doc. 99, p. 3). That
order did not hold that Faraway is limited to “pursu[ing] the claims process”;
it held that Faraway failed to properly plead its counterclaims.
1

3

counterclaims sprang from that particular legal conclusion, the
Court ruled that those counterclaims were not plausibly pleaded.
Third, the Court did not opine on the viability of putative
counterclaims for breach of contract, tortious breach of contract,
and gross negligence based on factual allegations showing that
Hudson’s

obligations

under

the

union

mortgage

clause

were

triggered in another way or by another event. Rather, the Court
held that Hudson’s obligations were not triggered when and how
Faraway alleged —— through Talex’s submission of a proof of loss.
Faraway is free to seek leave to amend its complaint to allege
facts showing that another event, such as its assertion of an
independent right to payment in its answer to Hudson’s complaint,
triggered Hudson’s union

mortgage clause-based obligations

to

Faraway. But Faraway cannot amend its counterclaim by memorandum
brief. If Faraway wishes to pursue that theory or another, it must
move the Court for leave to file a second amended counterclaim.
Accordingly,
IT IS ORDERED that Faraway, LLC’s motion [Docs. 98, 99] to
reconsider is DENIED.
SO ORDERED, this the 15th day of August, 2018.
/s/ David Bramlette_________
UNITED STATES DISTRICT JUDGE

4