Kingsbury Navigation Ltd. v. Koch Supply & Trading, LP

Filing 35

OPINION AND ORDER denying 32 Motion for Reconsideration.(Signed by Judge Melinda Harmon) Parties notified.(rvazquez)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
KINGSBURY NAVIGATION LTD.,
Plaintiff,
VS.
KOCH SUPPLY & TRADING, LP,
Defendant.

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CIVIL ACTION NO. 4:12-CV-1851

OPINION AND ORDER

Pending before the Court is Plaintiff Kingsbury Navigation Ltd.’s (“Kingsbury”) Motion
for Reconsideration (Doc. 32), Defendant Koch Supply & Trading, LP’s (“KS&T”) response
(Doc. 33), and Kingsbury’s reply (Doc. 34). Upon review and consideration of the motion, the
response thereto, and the relevant legal authority, the Court concludes that Kingsbury’s motion
should be denied.
I.

Background
On August 24, 2013, this Court issued its Opinion and Order (Doc. 30) granting KS&T’s

Motion to Compel Arbitration (Doc. 10) and dismissing Kingsbury’s claims of tortious
interference with contractual relations. While the Court acknowledged that “a nonsignatory to an
arbitration agreement may invoke that agreement ‘only in rare circumstances,’” the Court
determined that KS&T, a non-signatory to a charter agreement between Kingsbury and KS&T’s
affiliate, Koch Shipping, could nonetheless invoke the arbitration clause contained in the charter
under the doctrine of equitable estoppel, as adopted by the Fifth Circuit in Grigson v. Creative
Artists Agency, L.L.C., 210 F.3d 524 (5th Cir. 2000) reh’g en banc denied, 218 F.3d 745 (5th
Cir. 2000), cert. denied, 531 U.S. 1013 (2000). The Court analyzed the facts presented under the
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two tests identified in Grigson for determining whether a nonsignatory can compel arbitration
and concluded the facts satisfied both tests.
On September 16, 2013, Kingsbury filed its motion for reconsideration, asserting that the
Court’s order contains a “manifest error of law” in that the Court failed to consider the following
two arguments raised by Kingsbury in opposition to KS&T’s motion to compel arbitration: (1)
that KS&T was “contractually debarred” from invoking the arbitration clause because Koch
Shipping did not assign its rights under the charter to KS&T; and (2) that the Court did not
consider that Kingsbury’s claim of tortious interference with a second charter was not subject to
arbitration under the clause in the first charter. Doc. 32 at 1.
II.

Legal Standard
Kingsbury brings its motion under Federal Rule of Civil Procedure 59(e). A Rule 59(e)

motion “calls into question the correctness of a judgment.” Templet v. Hyrodchem, Inc., 367
F.3d 473, 478–79 (5th Cir. 2004). “A motion to alter or amend the judgment under Rule 59(e)
‘must clearly establish either a manifest error of law or fact or must present newly discovered
evidence’ and ‘cannot be used to raise arguments which could, and should, have been made
before the judgment issued.’” Rosenzweig v. Azurix Corp., 332 F.3d 854, 863–64 (5th Cir. 2003)
(In re Self, 172 F. Supp. 2d 813, 816 (W.D. La. 2001). Altering, amending, or reconsidering a
judgment is an extraordinary measure that should rarely be granted and only when (1) there is an
intervening change in controlling law; (2) the movant uncovered new evidence that was not
previously available; or (3) there is a need to correct a manifest error of law or fact. Schiller v.
Physicians Res. Grp., Inc., 342 F.3d 563, 567 (5th Cir. 2003).

A court has considerable

discretion in determining whether to reopen a case in response to a motion for reconsideration
under Rule 59(e). Lavespere v. Niagra Mach. & Tool Works, Inc., 910 F.2d 167, 174 (5th Cir.
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1990), abrogated on other grounds by Little v. Liquid Air Corp., 37 F.3d 1069, 1075 n.14 (5th
Cir. 1994) (en banc). In such a circumstance the court “must strike the proper balance between
two competing imperatives: (1) finality, and (2) the need to render just decisions on the basis of
all the facts.” Edward H. Bohlin Co. v. Banning Co., 6 F.3d 350, 355 (5th Cir. 1993).
III.

Discussion
Kingsbury’s motion does not identify a manifest error of law; it simply reasserts

arguments that were not resolved to its satisfaction. Kingsbury’s first argument—that KS&T
was “contractually debarred” from invoking the arbitration clause because Koch Shipping did
not make KS&T an assignee under the charter—ignores the legal basis for the Court’s order.
The Court concluded that KS&T’s right to arbitrate arises from the application of the doctrine of
equitable estoppel, not from any rights received or assigned under the charter. Kingsbury’s
claims both rely upon the written agreement containing the arbitration clause and they raise
allegations of substantially interdependent and concerted misconduct between the signatory
(Koch Shipping) and the non-signatory (KS&T). Therefore, the doctrine of equitable estoppel
was warranted under both of the Grigson tests. Kingbury’s second argument—that the Court did
not consider that it raised two claims of tortious interference instead of one—is also without
merit.

The Court’s analysis applied equally to both of Kingsbury’s claims of tortious

interference. Kingsbury’s arguments lack merit and were already considered by the Court and
rejected in the August 24 Order. Furthermore, the authority cited by Kingsbury is obviously
distinguishable from the facts presented and provides no support for its argument that the Court
made a manifest error of law.

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IV.

Conclusion
Kingsbury has failed to demonstrate the existence of an intervening change in controlling

law, newly discovered evidence, or a manifest error of law or fact. Accordingly, it is hereby
ORDERED that Kingsbury’s Motion for Reconsideration (Doc. 32) is DENIED.
SIGNED at Houston, Texas, this 18th day of August, 2014.

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MELINDA HARMON
UNITED STATES DISTRICT JUDGE

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