Murphy v. Adelphia Recovery Trust

Filing 17

Memorandum Order denying 8 Motion for Reconsideration filed by Adelphia Recovery Trust. (See Order) (Ordered by Magistrate Judge Jeff Kaplan on 12/8/2009) (skt)

IN THE I-]NITEDSTATESDISTRICTCOURT DISTRICTOF TEXAS NORTHERN D A L L A S DIVISION S U EMURPHY
Movant,

$ $ $ $
$ $ $ $ $

VS. A D E L P H I A RECOVERYTRUST
Respondent.

NO.3-09-MC-105-B

MEMORANDUM

ORDER

A d e l p h i a RecoveryTrust ("ART") has askedthe court to reconsiderits November 3, 2009 Bank of issuedto Sue Murphy, an attorneywho represented o r d e r quashinga Rule 45 subpoena A m e r i c a , N.A, ("BOA") in a transactioninvolving a $2.5 billion credit facility for the benefit of A d e l p h i a CommunicationsCorporation("Adelphia") and its subsidiariesthat is the subjectof a lawsuit pending in New York federal court (the "New York Litigation"). As groundsfor its motion, that: (1) counselfor BOA misledthe court aboutthe extentof Murphy'sinvolvement A R T contends submitted i n the New York Litigation; and(2)the court failed to considerall the depositionexcerpts b y the parties, which resulted in the mistaken conclusion that ART failed to pursue relevant t e s t i m o n yfrom alternativesources.If ART can show that Murphy hasknowledgeof factsrelevant t o the New York Litigation, but is not so involved in that lawsuit such that her depositioncould p o t e n t i a l l yleadto the disclosure trial strategy andattorneywork product,theSheltontestdoesnot of tendered the partiesin their original submissions by a p p l y . r If the court failed to considerevidence

Under Shelton,a party make take the depositionof opposingcounselonly if; ( I ) there are no other means to obtain the information sought; (2) the information is relevant and not privileged; and (3) the information is crucial to ($th Cir. 1986). t h e p r e p a r a t i o n o f t h ecase.Sheltonv.AmericanMotorsCorp.,805F.2d1323,1327

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other than Murphy, it may showing that ART cannotobtain the information it seeksfrom sources to b e able to satisff the Sheltonrequirements.Murphy has filed a response the motion, and both s i d e swere given an opportunityto presentevidenceand argumentat a hearingheld on December 4 , 2 0 0 9 . This matter is now ripe for determination. action, of Because ART seeksreconsideration a final order terminatingthis miscellaneous the court considersthe motion under Rule 59(e). SeeTrust CompanyBankv. United StatesGypsum a C o . , 9 5 A F.2d I t44, Ll47 (5th Cir. 1992)("[A] motion which challenges prior judgmenton the m e r i t s will be treated as a Rule 59(e) motion if it is served within ten days after entry of the j u d g m e n t . " ) . To prevail, the movant must show: (l) an interveningchangein controlling law; (2) t h e availability of new evidencenot previouslyavailable;or (3) the needto correcta clear error of .2d l a w or preventmanifestinjustice. SeeNelsonv. Universityof Texasat Dallas,49l F.Supp 672, F.3d318 (5th Cir. 2008),quotingIn re Beniamin 6 7 5 (N.D. Tex. 2007) rev'don othergrounds,535 , M o o r e & Co., 318 F.3d 626,629 (5th Cir. 2002). A Rule 59(e)motion cannotbe usedto "raise a r g u m e n t s[that] could, and should, have been made before the judgment issued." Id., quoting T u r n e r v. Baylor RichardsonMedical Center,476 F.3d 337,345 (5th Cir. 2007). In the Fifth remedythat shouldbe usedsparingly." /d., an C i r c u i t , sucha motion is considered "extraordinary q u o t i n g Templetv. HydroChem,Lnc.,367 F.3d 473,479 (5th Cir.), cert. denied,125 S.Ct. 4ll (2004). I n an attemptto show that counselfor BOA misled the court about the extent of Murphy's i n v o l v e m e n t in the New York Litigation, ART relies on billing invoices showing that between F e b r u a r y 2007 and September2009, Murphy billed only 130 hours to the file, which represents 0 . 3 8 % of the total hours billed by her law firm. The court initially observesthat these billing i n v o i c e s were available to AP{T before the parties submitted their joint status report on the

uponwhich the court may reconsider underlyingmotion.2Thus,the invoicesarenot "new evidence" i t s prior order. it this evidence, doesnot compela differentresult. That Murphy E v e n if the court considers 2009 b i l l e d only 130 hoursto the New York Litigation file betweenFebruary2007 and September d o e snot necessarily meanthat her involvementin the casehasbeendeminimus. Although Murphy h a s billed lesstime to Adelphia mattersin recentyears,her billings since2002--theyear Adelphia morethan 4,408.9. Of thattime, approximately f i l e d for bankruptcy--total 3,000hours,representing $ 1.5 million in legalfees,werebilled afterART initiatedtheNew York Litigation in July 2003. (See M u r p h . Hrg. Exh. 4A). At the hearing,Murphy testifiedthat much of her time was written-off due t o limited funds availablefrom the Adelphia Litigation IndemnificationFund for the paymentof her Murphy, who described role in theNew York Litigation as "captain"ofthe BOA fees.3 attorney's assistedin drafting d e f e n s eteam, also testified that she has participatedin strategydiscussions, made samestatements pleadings, and met with witnesses, helpedcollectandreview documents--the (SeeJt.Stat.Rep.App. Murph. Exh. B at2,fl 8). Despite relativelyfew the i n her prior declaration.

Counselfor ART told the court that he did not haveenoughtime to obtainthe billing invoicesfrom Adelphia order issued report. This argument ringshollow. Underthemeet-and-confer b e f o r ethe deadlinefor filing thejoint status o n September30, 2009, the partieswere given eight days to submit a joint statusreport containingtheir arguments, at2. The order specificallyprovides: a u t h o r i t i e s ,and supportingevidence. SeeOrder, 9/30109 I f further briefing is desiredbefore any unresolvedmattersare decided,the joint statusreport must indicate why the parfy requestingfurther briefing could not fully p r e s e n tits arguments in and authorities the report. The court, in its discretion,may a l l o w further briefing upon requestby any party. in I d . at 3 . ART did not requestan opporfunifyto submit further briefing due to allegedtime constraints obtainingand of r e v i e w i n g Murphy'sbilling records. Nor did ART requestan extension time to submitthe joint stafusreport,which w o u l d have beengrantedas a matterof course. Moreover, ART waited until November 10, 2009-one week after the its the from Adelphia, (SeeART Mem. Br. at6 & App., ConnellDecl. c o u r t issued opinion*to request billing records a t 2, tf 5). The recordswere provided to ART promptly after the requestwas made. havepaid their litigation costsfrom By order ofthe bankruptcycourt, BOA and the other bank defendants in t h e Adelphia Litigation IndemnificationFund,or "LIF," subjectto disgorgement the eventART prevailson its claims i n the New York Litigation. 3

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t hoursbilled to the New York Litigationfile in the last threeyears, court still believeshat the a leadto the disclosure litigationstrategy nd of a l l o w i n g Murphy'sdeposition could potentially Shelton applies. attomeywork product. Therefore,
T h e court also rejectsthe argumentthat it failed to considerthe entire record submittedby key factor to t h e partiesin concludingthat therewere "viable alternatives" Murphy's deposition--a u n d e r Shelton. Contraryto ART's claim, the court did not baseits decisionentirely on excerpted p o r t i o n s of PamelaSue Kurtzman'sdeposition. (SeeART Mem. Br. at 9). Instead,the court used the deposition excerpt as an example to illustrate how counsel for ART failed to pursue relevant t e s t i m o n yfrom alternativesources.SeeMem. Op.& Order, lll3l09 at 8. In addition,ART ignores in deposed the New York Litigation were able to testiff aboutthe origination, t h a t other witnesses The court'sopinion specificallymentionsthree ofthe credittransactions. e v o l u t i o n ,andnegotiations summarizes Rigas--and Marshall,Michael Mulcahey,andJames f o r m e r Adelphiaemployees--Dean originally submittedby the t h e relevantportionsof their testimony. Seeid. at6-7 . All the evidence p a r t i e swas carefullyconsidered the court in reachingits decision.Thereis no basisto revisit this by issue.

ART'smotionfor reconsideration reasons, F o r these [Doc.#8] is denied. S OORDERED. D A T E D : December 2009. 8,

AN S ] ' A T E S T,{AGISTRATEJL]DCH