Hanover Insurance Company v. Superior Labor Services, Inc. et al, No. 2:2011cv02375 - Document 537 (E.D. La. 2017)
Court Description: ORDER AND REASONS denying 532 Motion for Reconsideration. Signed by Judge Susie Morgan on 8/18/2017. (Reference: 16-2490)(clc)
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Hanover Insurance Company v. Superior Labor Services, Inc. et al Doc. 537 U N ITED S TATES D ISTRICT COU RT EASTERN D ISTRICT OF LOU ISIAN A H AN OVER IN SU RAN CE COMPAN Y, Pla in tiff CIVIL ACTION VERSU S N o . 11-2 3 75 c/ w 14 -19 3 0 14 -19 3 3 , 16 -2 4 9 0 SU PERIOR LABOR SERVICES, IN C., ET AL. D e fe n d an ts SECTION “E” Ap p lie s t o : 16 -2 4 9 0 ORD ER AN D REAS ON S Before the Court is Allied Shipyard, Inc.’s (“Allied”) m otion for reconsideration. 1 On J uly 12, 20 17, the Court granted State National Insuran ce Com pany’s (“State National”) m otions for sum m ary judgm ent 2 with respect to Allied’s status as an additional insured under the insurance policies State National issued to Masse Contracting In c. (“Masse”) for 20 0 6– 20 0 7 and 20 0 8– 20 0 9 (the “Masse Policies”) and the insuran ce policies State National issued to Superior Labor Services, Inc. for 20 0 7– 20 0 8 and 20 0 8 – 20 0 9 (the “Superior Policies”). 3 In Allied’s m otion, it asks the Court to reconsider its ruling under Rule 59(e) of the Federal Rules of Civil Procedure. Allied contends the Court com m itted a m anifest error of law in granting State National’s m otions for sum m ary judgm ent because the Court concluded that neither the 1995 Master Work Contract between Allied and Masse 4 nor the 20 0 6 Master Work 1 R. Doc. 532. R. Docs. 445 and 446. 3 R. Doc. 510 . 4 The Court notes that Allied—for the first tim e, in its m otion for reconsideration —m entions a 20 0 7 Master Work Contract between Allied and Masse. R. Doc. 532. Allied did not reference a 20 0 7 Master Work Contract between Allied an d Masse in its answer to State National’s petition for declaratory judgm ent, R. Doc. 194; in its response to State National’s statem ent of uncontested facts attached to State National’s m otion for sum m ary judgm ent, R. Doc. 493; in its opposition to State National’s m otion for sum m ary judgm ent, R. Doc. 452; or in the declaration attached to the instant m otion for reconsideration , R. Doc. 532-4. The Court did not consider the 20 0 7 Master Work Contract in connection with this Order. 2 1 Dockets.Justia.com Contract between Allied and Superior “were enforceable contracts absent eviden ce of subsequent purchase or work orders.”5 Allied further argues the Court’s ruling will result in m an ifest injustice to Allied because the Master Work Contracts “contain express, unequivocal agreem ents by Masse and Superior to obtain com m ercial liability insurance and to nam e Allied as an additional insured.”6 A m otion for reconsideration pursuant to Rule 59(e) of the Federal Rules of Civil Procedure “m ust clearly establish either a m anifest error of law or fact or m ust present newly discovered evidence an d cannot be used to raise argum ents which could, and should, have been m ade before the judgm en t issued.”7 A m otion for reconsideration “is ‘not the proper vehicle for rehashing eviden ce, legal theories, or argum ents that could have been offered or raised before the entry of [the order].’”8 “The Court is m indful that ‘[r]econsideration of a judgm ent after its entry is an extraordinary rem edy that should be used sparingly.’”9 “When there exists no independent reason for reconsideration other than m ere disagreem ent with a prior order, reconsideration is a waste of judicial tim e and resources and should not be granted.”10 In deciding m otions under the Rule 59(e) standard, the courts in this district have considered the following factors: (1) whether the m ovant dem onstrates the m otion is n ecessary to correct m anifest errors of law or fact upon which the judgm ent is based; (2) whether the m ovant presents new eviden ce; 5 R. Doc. 532-1 at 1– 2. R. Doc. 532-1 at 2. 7 Schiller v. Phy sicians Res. Grp. Inc., 342 F.3d 563, 567 (5th Cir. 20 0 3) (citations and internal quotation m arks om itted). 8 Lacoste v. Pilgrim Int’l, No. 0 7-290 4, 20 0 9 WL 1565940 , at *8 (E.D. La. J une 3, 20 0 9) (Vance, J .) (alteration in original) (quoting Tem plet v . Hy droChem Inc., 367 F.3d 473, 478 – 79 (5th Cir. 20 0 4)). 9 Castrillo v. Am . Hom e Mortg. Servicing, Inc., No. 0 9-4369, 20 10 WL 1424398, at *4 (E.D. La. April 5, 20 10 ) (alteration in original) (quotin g Tem plet, 367 F.3d at 479). 10 Lightfoot v. Hartford Fire Ins. Co., No. 0 7-4833, 20 12 WL 711842, at *3 (E.D. La. Mar. 5, 20 12) (Brown , J .). 6 2 (3) whether the m otion is necessary in order to prevent m anifest injustice; and (4) whether the m otion is justified by an intervening change in the controlling law. 11 Allied argues the Court com m itted a m anifest error of law in concluding the Master Work Contracts were not binding and enforceable and that the Court m ust reconsider its granting of State National’s m otions for sum m ary judgm ent to prevent m anifest injustice to Allied. 12 I. Th e Co u rt D id N o t Co m m it Man ife s t Le ga l Erro r in Co n clu d in g th e Ma s te r W o rk Co n tracts w e re N o t Bin d in g an d En fo rce able State National sought sum m ary judgm ent on Allied’s status as an additional insured under the policies it issued to Masse and Superior and its duty to defend Allied as an additional insured under the State National policies with respect to claim s m ade in the Adam s and St. Pierre state-court lawsuits. 13 Allied has the burden of proving it is an “additional insured” under State National’s policies. In its m otion for sum m ary judgm ent, State National argued that Allied could not m eet an essential elem ent of its claim that it is an additional insured—the existence of a com plete and enforceable contract—pointing to “[t]he failure of Allied to present a com plete and enforceable contract with all pertinent purchase orders or other agreem ents that incorporate the term s and conditions of the blanket m aster contract.”14 11 Castrillo, 20 10 WL 1424398, at *4. The Court notes that the tim e lim its of Rule 59 do not apply in this m atter because the order appealed is interlocutory. Rules 59 and 60 set forth deadlines for seeking reconsideration of final judgm ents. See Carter v. Farm ers Rice Milling Co., Inc., 33 F. App’x 70 4, at *2 (5th Cir. 20 0 2) (per curiam ); Lightfoot, 20 12 WL 711842, at *2. 12 R. Doc. 532-1, at 2. 13 R. Doc. 445, 446. 14 R. Doc. 445-1 at 11. 3 Allied opposed the m otions for sum m ary judgm ent but, with respect to this argum ent, said only that “Allied did offer Masse work at the shipyard and Masse accepted. Masse perform ed work at the Allied Shipyard for years. Thus, the obligation in the Master Work Contract was fulfilled, becom ing ‘valid and enforceable.’”15 Allied apparently takes the position that any work perform ed by Masse after the execution of either Master Work Contract, at any tim e, with or without purchase orders or other agreem ents, is sufficient to establish that the work was done under the applicable Master Work Contract and that the applicable Master Work Contract is a com plete and enforceable contract for all purposes thereafter. Without agreeing that this argum ent is correct, the court notes that Allied failed to cite m aterials in the record to support this argum ent. 16 When the m ovant seeks sum m ary judgm ent on the basis that the nonm ovant has no evidence to establish an essential elem ent of its claim , the nonm oving party m ay defeat a m otion for sum m ary judgm ent by “calling the Court’s attention to supporting eviden ce already in the record that was overlooked or ignored by the m oving party.”17 Rule 56(c) of the Federal Rules of Civil Procedure requires that Allied support its opposition to the m otions for sum m ary judgm ent by citing to m aterials in the record, such as depositions, docum ents, or stipulations, to establish that a genuine issue of disputed fact exists with respect to whether Masse perform ed work under the Master Work Contracts. If Allied had com e forward with supporting evidence to show that a m aterial fact was in dispute, the 15 R. Doc. 452 at 4. Without citation, Allied contends that it is undisputed that “substantial work” was perform ed under the Master Work Contracts by Masse and Superior. See R. Doc. 532-1 at 9– 10 . Presum ably, Allied would ask this Court to take it at its word. But Allied’s argum ent—without sum m ary-judgm ent evidence—is insufficient to create factual disputes. Johnson v. N ew S. Fed. Sav. Bank, 344 F. App’x 955, 956 (5th Cir. 20 0 9) (per curiam ) (“Appellant’s brief on appeal contains a num ber of rhetorical questions and im passioned argum ents, but it fails to cure the defect which proved fatal to Appellant’s case in the district court: Appellant provides no com petent sum m ary judgm ent evidence sufficient to dem onstrate that a genuine issue for trial exists . . . .”). 17 Celotex Corp. v. Catrett, 477 U.S. 317, 332– 33 (1986). 16 4 burden would have shifted to State National to dem onstrate the inadequacy of the eviden ce Allied relied upon, but this did not occur. Allied’s statem ent that “Masse has perform ed work at the Allied shipyard for years” without citation to record evidence is insufficient for Allied to m eet its burden as the non-m ovant on sum m ary judgm ent. Now, Allied asks that the Court reexam ine its ruling on the m otions for sum m ary judgm ent in light of eviden ce that could have been subm itted to support its oppositions to the m otions for sum m ary judgm ent but, instead, was attached to its m otion for reconsideration. Specifically, Allied seeks consideration of the declaration of Gavin Callais and the checks from Allied to Masse and Superior, which Allied contends com m em orate paym ents for work perform ed under the 1995 and 20 0 6 Master Work Contracts during the policy periods. 18 Allied m akes no argum ent that this eviden ce was “newly discovered,” or that it was previously unavailable. 19 The Fifth Circuit has held that the unexcused failure to present evidence available at the tim e of sum m ary judgm ent is a valid basis for denying a m otion to reconsider. 20 Allied next conten ds the Court com m itted m anifest legal error when it held that the Master Work Contracts were not enforceable absent the existence of purchase orders. 21 Allied disagrees with the Court’s ruling and argues that it was not required to provide written purchase orders or work orders or to show work was actually done under the Master Work Contracts during the State National policy periods. According to Allied, 18 R. Doc. 532-4. See Schiller, 342 F.3d at 567. 20 Russ v. Int’l Paper Co., 943 F.2d 589, 593 (5th Cir. 1991); see also Knight v. Kellogg Brow n & Root Inc., 333 F. App’x 1, 8 (5th Cir. 20 0 9) (“[T]he plaintiffs fail to adequately explain why they did not obtain these docum ents before sum m ary judgm ent, and an unexcused failure to present evidence available at the tim e of sum m ary judgm ent provides a valid basis for denyin g a subsequent m otion for reconsideration.” (internal quotation m arks om itted)). In this case, there is no reason to believe that Allied did not have these docum ents at the tim e it filed oppositions to the m otions for sum m ary judgm ent as Gavin Callais is the president of Allied and the checks were issued by Allied. R. Doc. 532-4. 21 R. Doc. 532-1 at 4. 19 5 “[t]here is no blanket requirem ent under Louisiana law (or analogous law) that [Master Work Contracts] be followed by purchase or work orders in order for the [Master Work Contract] to be a valid, binding, and enforceable contract.”22 Each of the cases Allied cites in support of its argum ent is distinguishable; the cases do not support a finding that this Court com m itted an error of law. First, Allied cites Freret Marine Supply v. M/ V Enchanted Capri, in which the court stated the m aster services agreem ent between a bank and a vessel operator was the “operative agreem ent.”23 Allied, however, presum ably neglected to read the rest of the Freret court’s sentence. The Freret court expressly distin guished the m aster services agreem ent in Freret, stating the m aster services agreem ent in Freret was the operative agreem ent, “and unlike a blanket Master Service Agreem ent, it did not contem plate future w ork orders w hich w ould m odify the term s or services it provided.”24 Unlike the m aster services agreem ent in Freret, each of the Master Work Contracts between Allied and Masse and Allied and Superior contain the following language: [Allied] shall pay Contractor for the work perform ed at the rate and for the consideration provided for in [Allied’s] purchase order or through other agreem ent. Paym ent of invoices will be m ade in accordance with the established [Allied] procedures following acceptance by [Allied] of work done by Contractor as being in full com pliance with all term s, conditions and requirem ents of the Contract and the specific job or project undertaken. In the event of a conflict betw een the term s of a[n] [Allied] purchase order issued in connection herew ith and this Contract, the term s and con ditions of the purchase order shall govern the agreem ent of the parties. 25 The Freret court referred to the type of Master Work Contracts at issue in this case as “blanket” agreem ents, as they contem plate future work orders. As a result, Allied bore the 22 R. Doc. 532-1 at 5. No. 0 0 -380 5, 20 0 2 WL 39280 1, *3 (E.D. La. Mar. 11, 20 0 2) (Engelhardt, J .). 24 Id. (em phasis added). 25 R. Docs. 532-2 at 2 (1995 Master Work Contract with Masse); 532-2 at 10 (20 0 7 Master Work Contract with Masse); 532-3 at 2 (20 0 6 Master Work Contract with Superior) (em phasis added). 23 6 burden on sum m ary judgm ent to presen t evidence of purchase orders or other agreem ents to create a genuine issue of m aterial fact with respect to whether work was actually com pleted by Masse or Superior during State National’s policy periods. Freret does not support Allied’s argum ent. Second, Allied points to In re Elevating Boats, Inc., in which the court determ ined whether a m aster service agreem ent was subject to m aritim e law. 26 Like the Master Work Contracts in this case, the m aster services agreem ent in Elevating Boats contain ed general provisions governing work and services the contractor would perform under separate individual assignm ents and work orders. 27 On sum m ary judgm ent, the parties agreed that there was n o specific work order for the date at issue. 28 Elevating Boats differs from this case in that the contractor in Elev ating Boats provided sum m ary-judgem ent eviden ce that it actually perform ed w ork under the m aster services agreem ent on the date in question. 29 Again, Allied failed to provide any sum m ary-judgm ent evidence in its opposition to State National’s m otion for sum m ary judgm ent that purchase orders existed or that work was actually perform ed under the Master Work Contracts during the policy periods. Elevating Boats is inapplicable. Third, Allied points to cases in support of its argum ent that form al work or purchase orders are not necessary, but instead, inform al verbal “work orders” are sufficient. 30 In Am oco Production Co. v. W ireline Consultants, Inc., the m aster contract at issue expressly provided that it “shall control and govern all work perform ed by Contractor for Am oco, under verbal or w ritten orders, at all tim es until canceled by either 26 No. 0 0 -2282, 20 0 2 WL 272372 (E.D. La. Feb. 22, 20 0 2) (Vance, J .). Id. at *1. 28 Id. at *3. 29 Id. 30 R. Doc. 532-1 at 7. 27 7 party.”31 The Master Work Contracts between Allied and Masse and Allied an d Superior do not contain express language allowing the use of verbal work orders, and even so, Allied presented no eviden ce in opposition to State National’s sum m ary judgm ent that verbal work orders existed or were Allied’s com m on practice or that this practice prevailed during the relevant policy periods. 32 Each of the cases cited by Allied is inapposite. The Master Work Contracts in this case provide: “If at any tim e during the term hereof, [Allied] desires work to be perform ed for a particular job or project, [Allied] shall advise contractor of the particulars of the work and the location thereof.”33 Further, as discussed above, the Master Work Contracts contem plate that Allied will be paid for work perform ed at the rate and for the consideration “provided for in [Allied’s] purchase order or through other agreem ent” and that “the term s and conditions of the purchase order shall govern the agreem ent of the parties.”34 It is clear that the Master Work Contracts contem plated that separate purchase orders would be entered into, and that work under the contract would be perform ed only if Allied sought work to be perform ed for a particular job or project. The 31 No. 90 -4940 , 1993 WL 8611, *1 n.4 (E.D. La. J an . 4, 1993) (Arceneaux, J .) (em phasis added). The Am oco court was faced with whether—on a m otion in lim in e—it should consider outside evidence regardin g industry custom in determ ining whether verbal work orders m odified the contract. Id. at *1. 32 Allied also cites W allace v. Oceaneering International, in which the Fifth Circuit considered a claim for contractual indem n ity under a m aster service contract. 727 F.2d 427, 437– 38 (5th Cir. 1984). The W allace court found that the m aster services contract at issue “dem onstrate[d] that the parties contem plated that the contract would not becom e effective until Zapata issued a verbal or written work order and [the contractor] accepted the assign m ent.” Id. at 438 . In that case, “there was no work order given by Zapata in connection with the job on which [the contractor] was injured.” Id. Thus, the court held the “inapplicability of the m aster service contract also defeats Zapata’s claim for indem n ity.” Id. Again, in this case, Allied produced no sum m ary-judgm ent evidence in its opposition to State National’s sum m ary judgm ent m otions to create a factual dispute with respect to whether work orders—verbal or written —existed during the tim e of the Masse and Superior Policies, or that any work was actually done under the Master Work Contracts by Masse or Superior durin g State National’s policy periods. 33 R. Docs. 532-2 at 2 (1995 Master Work Contract with Masse); 532-2 at 10 (20 0 7 Master Work Contract with Masse); 532-3 at 2 (20 0 6 Master Work Contract with Superior) (em phasis added). 34 R. Docs. 532-2 at 2 (1995 Master Work Contract with Masse); 532-2 at 10 (20 0 7 Master Work Contract with Masse); 532-3 at 2 (20 0 6 Master Work Contract with Superior) (em phasis added). 8 Master Work Contract, therefore, is not—standing alone— an enforceable contract for the purposes of affording additional insured status. 35 The Court com m itted no m anifest error of fact or law in granting State National’s m otions for sum m ary judgm ent. II. D e clin in g to Re co n s id e r th e Co u rt’s Ord e r w ill n o t Re s u lt in Ma n ife s t In ju s tice In its m otion for reconsideration, Allied argues “[e]ven if the Court concludes that its Order granting State National’s Motions for Sum m ary J udgm ent was not m anifest legal error, reconsideration under Rule 59(e) is nevertheless warranted to avoid m anifest injustice to Allied.”36 According to Allied, the Court’s granting of State National’s m otions for sum m ary judgm ent “voids Allied’s contractually-agreed upon right to addition alinsured coverage on the basis that Allied failed to introduce eviden ce of purchase or work orders.”37 Although few cases discuss m anifest injustice standard, the Southern District of Texas has offered its well-supported thoughts on the topic: There is no general definition of m anifest injustice; rather, courts evaluate whether there has been a m anifest injustice on a case-by-case basis. Alvarado v. Texas Rangers, No. 0 3-0 30 5, 20 0 5 WL 1420 846, at *3; In re Cusano, 431 B.R. 726, 734 (6th Cir. 20 10 ) (“Manifest injustice, as contem plated by Rule 59(e), is an am orphous concept with no hard line definition. However, courts have established various guidelines to be used on a case-by-case basis to determ in e whether the n ecessary m anifest injustice has been shown.” (quotations and citations om itted)). According to som e courts, “‘[w]hat is clear from the case law, and from a natural reading of the term itself, is that a showing of m anifest injustice requires that there exist a fundam ental flaw in the court’s decision that without correction would lead to a result that is both in equitable and not in lin e with applicable policy.;” Id. (quoting Bunting Bearings Corp., 321 B.R. 420 (Bankr. N.D. Oh. 20 0 4)). See also In re UBS AG ERISA Litig., No. 0 8-6696, 35 The Court does not determ ine whether a course of con ducting business without written purchase orders would be sufficient to render the Master Service Contracts valid and enforceable without written purchase orders because the issue was not presented in this case. 36 R. Doc. 532-1 at 9. 37 R. Doc. 532-1 at 10 . 9 20 12 WL 10 34445, at *4 (S.D.N.Y. March 23, 20 12) (“[A] district court has not com m itted a ‘m anifest injustice’ unless its error was ‘direct, obvious, and observable.’” (quoting BLACK’S LAW DICTIONARY 10 48; citing U.S. v. Luciano, 329 F.3d 1, 5 (1st Cir. 20 0 3))); In re Roem m ele, 466 B.R. 70 6, 712 (Bankr. E.D. Pa. 20 12) (“A party m ay only be granted reconsideration based on m anifest injustice if the error is apparent to the point of being indisputable. In order for a court to reconsider a decision due to m anifest injustice, the record presented m ust be so patently unfair and tainted that the error is m anifestly clear to all who view [it].” (quotations and citations om itted)). *** Of course, “[t]he m anifest injustice standard presents plaintiff with a high hurdle.” W esterfield v. U.S., 366 Fed. App’x 614, 619 (6th Cir. 20 10 ) (unpublished). “[R]eliance on an unsettled area of law does not amount to m anifest in justice.” Adam s v. District of Colum bia, 793 F. Supp. 2d 392, 399 (D. D.C. 20 11) (citing Qw est Serv’s Corp. v. Fed. Com m c’n Com m ’n, 50 9 F.3d 531, 540 (D.C. Cir. 20 0 7)). Im portantly, “[t]here is no m anifest injustice for purposes of a Rule 59(e) m otion ‘where . . . a party could easily have avoided the outcom e, but instead elected not to act until after a final order had been entered.’” In re Enron Corporation Securities, Derivative, & “ERISA” Litigation, No. MDL– 1446, 20 11 WL 3489599, at *5 (S.D. Tex. Aug. 9, 20 11) (quoting In re Young, No. 0 8 – 41515, 20 0 9 WL 2855766, at *4 (Bankr. E.D. Tex. Sept. 2, 20 0 9)). Nor is there m anifest injustice “‘if the only error the m ovant seeks to correct is a poor strategic decision.’” In re Cusano, 431 B.R. at 734 (quoting In re Henning, 420 B.R. 773, 785 (Bankr. W.D. Tenn. 20 0 9)). See also Courtade v. Harrah’s Operating Co., Inc., No. 10 – 40 36, 20 11 WL 2446454, at *4 (E.D. La. J un e 15, 20 11) (“[T]he negligence or erroneous strategy choices of a party’s attorney or the party herself, which contributed to the court’s dism issal of the party’s claim s, do not am ount to m anifest injustice.” (citing Robinson v. W ix Filtration Corp., LLC, 599 F.3d 40 3, 40 9 (4th Cir. 20 10 ); Gay le v. United Parcel Serv., Inc., 40 1 F.3d 222, 226– 27 (4th Cir. 20 0 5); Universal Film Exchs., Inc. v. Lust, 479 F.2d 573, 577 (4th Cir. 1973); Fox v. Am . Airlines, 389 F.3d 1291, 1296 (D.C. Cir. 20 0 4); Ciralsky v. Cent. Intelligence Agency , 355 F.3d 661, 673 (D.C. Cir. 20 0 4))). 38 A showing of m anifest injustice requires that there exist a fundam en tal flaw in the Court’s decision, which, as discussed above, did not occur. Allied could have provided eviden ce in support of its oppositions to the m otions to dism iss but, apparently, elected 38 Bender Square Partners v. Factory Mut. Ins. Co., No. 4:10 -CV-4295, 20 12 WL 1952265, at *4 (S.D. Tex. May 30 , 20 12). 10 not to act until the Court’s order granting the m otions had been entered. A party’s erroneous strategical choices do not am ount to m anifest injustice. 39 Accordingly; CON CLU SION IT IS ORD ERED that Allied’s m otion for reconsideration 40 is D EN IED . N e w Orle a n s , Lo u is ian a, th is 18 th d ay o f Au gu s t, 2 0 17. _____________________ _______ S U SIE MORGAN U N ITED S TATES D ISTRICT J U D GE 39 Shnew er v. United States, No. 13-3769, 20 16 WL 4424949, at *6 (D.N.J . Aug. 18, 20 16), aff’d, No. 163659, 20 17 WL 3411812 (3d Cir. Aug. 9, 20 17) (citing (“[I]t is not the job of courts deciding m otion for reconsideration to rescue parties from their strategic litigation choices . . . [nor] rescue parties from their own errors.”) (alterations in original); Zarcone v . United States, No. C 0 4-0 1428, 20 0 4 WL 2196560 , at *2 (N.D. Cal. Sept. 27, 20 0 4) (“Rule 59(e) does not require a court to rescue parties from the consequences of their own choices.”). 40 R. Doc. 531. 11
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