CALLAS v. CALLAS et al

Filing 221

OPINION/ORDER denying 188 Motion for Reconsideration re 181 Opinion, 182 Order on Motion to Dismiss. Signed by Judge John Michael Vazquez on 1/25/18. (DD, )

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

CALLAS,
Civil Action No. 14-7486

Plaintiff
OPINION & ORDER
V.

CALLAS, etaL,
Defendants.

John Michael Vazguez, U.S.D.J.
This matter comes before the Court on a motion for reconsideration filed by Plaintiff
William Dean Callas (“Plaintiff’), D.E. 18$, of the Court’s Opinion and Order denying Plaintiffs
motion to dismiss Count Six of the amended counterclaims filed by Defendants George and
Yvonne Callas, D.E. 181. The Court’s Opinion (the “Opinion”) and Order were issued on March

24, 2017. D.E. 181, 182. Defendants George and Yvonne Callas (the “Co-Executors”) filed a
brief in opposition to Plaintiffs motion. D.E. 193. The Court reviewed all submissions made in
support of the motions and considered the motions without oral argument pursuant to Fed. R. Civ.
P. 78(b) and L. Civ. R. 78.1(b). For the reasons that follow, Plaintiffs motion is DENIED.
I.

RECONSIDERATION STANDARD

In the District of New Jersey, motions for reconsideration can be made pursuant to Local
Civil Rule 7.1(1). The rule provides that such motions must be made within fourteen days of the
entry of an order. Plaintiff has complied with this time requirement. Substantively, a motion for
reconsideration is viable when one of three scenarios is present: (1) an intervening change in the
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. Carmichael v. Everson, No. 03-4787,
2004 WL 1587894, at *1 (D.N.J. May 21, 2004) (citations omitted).

Granting a motion for

reconsideration is an “extraordinary remedy,” to be granted “sparingly.” NL Indus., Inc. v.
Commercial Union Ins. Co., 935 F. Supp. 513, 516 (D.N.J. 1996) (citations omitted).
A motion for reconsideration, however, does not entitle a party to a second bite at the apple.
Therefore, a motion for reconsideration is inappropriate when a party merely disagrees with a
court’s ruling or when a party simply wishes to re-argue or re-hash its original motion. Sch.
Specialty, Inc. v. ferrentino, No. 14-4507, 2015 WL 4602995, *2..3 (D.N.J. July 30, 2015); see
also florham Park Chevron, Inc. v. Chevron U.S.A., 680 F. Supp. 159, 162 (D.N.J. 1988).
Moreover, a motion for reconsideration is not an opportunity to raise matters that could have been
raised before the original decision was reached. Bowers v. NCAA, 130 F. Supp. 2d 610, 613 (D.N.J.
2001). Reconsideration is an “extraordinary remedy” that is granted “very sparingly.” Brackett
v. Ashcroft, 2003 WL 2230307$, at *2 (D.N.J. Oct. 7, 2003) (citations omitted).
II.

ANALYSIS

Plaintiff does not argue that there has been an intervening change in law or that new
evidence is available. Instead, Plaintiff argues that reconsideration is “necessary to correct a clear
error of law.” P1. Br. at 1. Plaintiffs legal analysis, in its initial motion to dismiss, consisted of
two and one-half pages. D.E. 21 at 4-6. Although there is an operating agreement (“Operating
Agreement”) applicable to the current dispute, Plaintiff solely relied on the applicability of New
Jersey’s Revised Uniform Limited Liability Company Act as the basis for its motion. Id. In his
reply, Plaintiff briefly addressed the impact of the Operating Agreement. D.E. 28 at 5-6.
In its Opinion, the Court found that the “outcome of this motion turns on whether the
present dispute is governed by the Act or the Operating Agreement.” Opinion, D.E. 181 at 8.

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After observing that “there is an Operating Agreement that addresses the relationship between the
LLC’s members, and specifically indicates what happens to a member’s interest upon death,”
Opinion, D.E. 181 at 10, the Court found the Operating Agreement controlling. The Court,
however, denied Plaintiffs motion to dismiss Count $ix because the Operating Agreement “is
arguably ambiguous as to the status of a deceased member’s interest in between his time of death
and the time his interest is sold.” Opinion, D.E. 181 at 11. In other words, the Court found that
there was a controlling Operating Agreement that contained provisions which expressly addressed
the issue before the Court, but the interaction of those provisions was insufficiently clear to rule
on as a matter of law on a motion to dismiss.
Plaintiffs arguments now center on his claim that the Court misinterpreted and misapplied
the Act. Specifically, Plaintiff takes issue with the Court’s statement in its Opinion that “the Act
controls only in the absence of an operating agreement or if a listed exception applies.” Opinion,
D.E. 181 at 8 (citing BrickProf’l, L.L.C. v. Napoleon, No. A-1283-08T3, 2009 WL 2176699, at
*3 (N.J. App. Div. July 23, 2009); Union Cty. Improvement Auth. v. Artaki, 392 N.J. Super 141,
152 (App. Div. 2007)). Plaintiff claims the Court’s statement is contradicted by the language of

the statute, as well as by relevant case law because the Act includes a provision that states that
“[t]o the extent the operating agreement does not otherwise provide for a matter described in
subsection a. of this section, this act governs the matter.” N.J.S.A. 42:2C-11(b). Plaintiff argues
that the Court overlooked the language of section (b) and that this section “flatly contradicts [the
Court’s] conclusion that ‘the Act controls only in the absence of an operating agreement.” P1. Br.
at 2 (quoting Opinion, D.E. 181 at 8). Plaintiff attempts to argue that the Court misapplied the Act
because while courts often have “consistently held that New Jersey’s statute governing LLCs

.

.

controls only in the absence of an operating agreement,” Brick Pro/i, L.L. C. v. Napoleon, No. A

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1283-0813, 2009 WE 2176699, at *3 (N.J. Super. Ct. App. Div. July 23, 2009) (citing N.J.S.A.
42:23-1 to -70), some courts have also stated that the Act controls “in the absence of a contrrny
operating agreement,” Kuhn v. Tumminetti, 366 N.J. Super. 431, 501, 841 A.2d 496, 501 (App.
Div. 2004) (emphasis added). Plaintiff focuses on the difference in phrasing to base its claim that
the Court’s conclusions are “flatly contrary to both the controlling statute and the controlling case
law.” P1. Br. at 9. Plaintiffs claims are wholly without merit.
First, these arguments were available to Plaintiff when he brought his motion to dismiss
and he failed to raise them. In making his motion to dismiss, Plaintiff utterly failed to address the
effect of the Operating Agreement, instead relying on the Act. In his reply to the motion to dismiss,
Plaintiff touched upon the Operating Agreement, but did not provide a convincing analysis. His
reply, again, focused on the Act. To the extent Plaintiff is now rearguing the effect of the Operating
Agreement, a motion for reconsideration is not appropriate to rehash previously rejected
assertions. Moreover, to the extent Plaintiff did not raise his current arguments in his motion to
dismiss, such arguments were clearly available to him and he chose, for whatever reason, not raise
them. Yet, Plaintiffs failure to make a timely argument not a basis for reconsideration.
Second, the Court is also unconvinced by Plaintiffs substantive argument.’ The Act
clearly states that “[t]o the extent the operating agreement does not otherwise provide for a matter
described in subsection a. of this section, this act governs the matter.” N.J.S.A. 42:2C-11(b). In
turn, subsection (a) states, in part, that “[e]xcept as provided in subsections b. and c. of this section,

The Court notes that both parties cite to the current Act, which was enacted in 2013. The Court
further notes that both parties cite to cases addressing the previous version of the Act before it
was repealed and replaced. See JE Test, LLC v. Carroll, 226 N.J. 166, 183 (N.J. 2016). To be
clear, the Court is not precluding either party from arguing, in the future, which version of the
Act should apply in this case.
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the operating agreement governs: (1) the relations among the members as members and between
members and the limited liability company.

.

.“

N.J.S.A. 42:2C-1 1(a)(1).

Plaintiff argues that the Act applies in the absence of a contrary provision in the Operating
Agreement. D.E. 188-1 at 7. However, the Court did not find in its Opinion that Operating
Agreement was silent as to the issue being contested. Instead, the Court found that the Operating
Agreement expressly provided the definition of “member,” as well as explicitly provided for the
“Transferability of LLC Interests” and the “Death and Disability” ofrnembers. Opinion, D.E. 181,
at 9. Thus, as to the relevant issues, there were contrary provisions in the Operating Agreement.
Instead, the Court rejected the motion to dismiss because the interplay of these provisions was
ambiguous and attempting to decide the correct interpretation, on a motion to dismiss, was
inappropriate.
for the reasons state above, because Plaintiff fails to fulfill his burden of showing that the
Court made a clear error of law, Plaintiffs motion for reconsideration is denied.
III.

CONCLUSION
For the reasons stated above, and for good cause shown,
IT IS on this 25th day of January, 201$,
ORDERED that Plaintiffs motion for reconsideration (D.E. 188) is DENIED.

John Michael Vazquez(JJS.).J.

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