Lloyd's Syndicate 457 et al v. FloaTEC LLC d/b/a FloaTEC Solutions, LLC

Filing 129

MEMORANDUM AND OPINION entered DENYING 128 MOTION for Reconsideration of 127 Memorandum and Opinion. (Signed by Chief Judge Lee H Rosenthal) Parties notified.(leddins, 4)

United States District Court
Southern District of Texas

ENTERED
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
LLOYD’S SYNDICATE 457, et al.,
Plaintiffs,
VS.
FLOATEC LLC, et al.,
Defendants.

§
§
§
§
§
§
§
§
§

January 03, 2019
David J. Bradley, Clerk

CIVIL ACTION NO. H-16-3050

MEMORANDUM AND OPINION
Some of the plaintiffs, marine insurance underwriters, have moved under Federal Rule of
Civil Procedure 60(b) for reconsideration of this court’s December 27, 2018, memorandum and
opinion denying relief from the court’s July 2017 memorandum and opinion and entry of partial
final judgment dismissing the claims against FloaTEC LLC. They argue that the court erred in the
December 2018 memorandum and opinion by relying on an outdated contract provision, examining
“other insurance” provisions, finding that the commercial liability insurance did not cover
FloaTEC’s professional services, and determining that the Underwriters had waived subrogation
claims against FloaTEC. The court has carefully reviewed the motion, the prior rulings, the record,
and the applicable law, and, based on this review, denies the motion for reconsideration.
A district court may relieve a party from “a final judgment, order, or proceeding” for
“mistake, inadvertence, surprise, or excusable neglect.” FED. R. CIV. P. 60(b)(1). “The purpose of
Rule 60(b) is to balance the principle of finality of a judgment with the interest of the court in seeing
that justice is done in light of all the facts.” Hesling v. CSX Transp., Inc., 396 F.3d 632, 638 (5th
Cir. 2005). “Relief under Rule 60(b) is an extraordinary remedy; ‘the desire for a judicial process

1

that is predictable mandates caution in reopening judgments.’” Halliburton Energy Servs., Inc. v.
NL Indus., 618 F. Supp. 2d 614, 620 (S.D. Tex. 2009) (quoting In re Pettle, 410 F.3d 189, 191 (5th
Cir. 2005)). “Rule 60(b) may not be used to provide an avenue for challenges of mistake of law that
should ordinarily be raised by timely appeal.” Pryor v. U.S. Postal Serv., 769. F.2d 281, 286 (5th
Cir. 1985). “The decision to grant or deny relief under Rule 60(b) lies within the sound discretion
of the district court and will be reversed only for abuse of that discretion.” Hesling, 396 F.3d at 638
(alterations omitted) (quoting Edwards v. City of Hous., 78 F.3d 983, 995 (5th Cir. 1996) (en banc)).
As a threshold matter, the Underwriters challenge the legal basis of the court’s December
2018 memorandum and opinion. This challenge should be raised on timely appeal, not Rule 60(b).
Pryor, 769. F.2d at 286. The Underwriters contend that the court erred by considering the original
version of an amended contract provision. (Docket Entry No. 128 at 2–3). In the December 2018
memorandum and opinion, the court found that the primary and noncontributory clauses in
Chevron’s Policy and FloaTEC’s commercial liability insurance did not conflict because FloaTEC’s
agreement with Chevron did not require FloaTEC to obtain primary insurance for damages or losses
to Chevron’s property. (Docket Entry No. 127 at 12–13). Chevron’s Policy was primary. (Id.).
The Underwriters now point to an amendment to FloaTEC’s agreement with Chevron that requires
FloaTEC to indemnify Chevron for up to $5,000,000 in damage or losses to Chevron’s property.
(Docket Entry No. 128 at 3). They argue that FloaTEC’s commercial liability insurance had to
provide primary insurance based on this provision. (Id.).
FloaTEC’s agreement with Chevron, as amended, does require FloaTEC to obtain primary
insurance for damages or losses to Chevron’s property. (Docket Entry No. 30-3 at 41–42).
Chevron’s Policy and FloaTEC’s commercial liability insurance both contain “other insurance”

2

clauses stating that each is primary and that other insurance may not contribute to claims. (Docket
Entry No. 98-1 at 69; Docket Entry No. 116-2 at 76). Even assuming that the commercial liability
insurance covers the alleged damages arising from FloaTEC’s services, those clauses appear to
conflict. But the court need not address this conflict. As this court previously determined, “[e]ven
assuming FloaTEC’s commercial liability insurance covered professional services and prohibited
contribution from Chevron’s Policy, it would neither affect FloaTEC’s status as an Other Assured
nor abrogate the subrogation waiver.” (Docket Entry No. 127 at 13). The Underwriters have not
identified new evidence or raised new arguments supporting extraordinary relief from that
determination.
Because an appeal is pending, the court may “(1) defer considering the motion; (2) deny the
motion; or (3) state either that it would grant the motion if the court of appeals remands for that
purpose or that the motion raises a substantial issue.” FED. R. CIV. P. 62.1(a). The court denies the
Underwriters’ motion for relief under Rule 60(b). (Docket Entry No. 128).
SIGNED on January 3, 2019, at Houston, Texas.
______________________________________
Lee H. Rosenthal
Chief United States District Judge

3