In Re: Queyrouze, et al, No. 2:2014cv02715 - Document 36 (E.D. La. 2017)
Court Description: ORDER AND REASONS denying 30 Motion for Reconsideration re 29 Order and Reasons Referring Case to U.S. Bankruptcy Court for the Eastern District of Louisiana. Signed by Judge Susie Morgan. (bwn)
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In Re: Queyrouze, et al Doc. 36 U N ITED S TATES D ISTRICT COU RT EASTERN D ISTRICT OF LOU ISIAN A IN RE: QU EYROU ZE, ET AL. CIVIL ACTION N O. 14 -2 715 SECTION : “E” ORD ER AN D REAS ON S Before the Court is Continental Casualty Com pany, Randall Alfred, and Alfred, APLC’s (collectively “Defendants”) m otion for reconsideration. 1 Steve Queyrouze, Plan Trustee for the Forty Acre Corporation Plan Trust (the “Trust”), opposes the m otion. 2 The Court has reviewed the briefs, 3 the record, 4 and the applicable law, and now issues this order and reasons. D ISCU SSION On Novem ber 9, 20 17, this Court denied Defendants’ m otion for sum m ary judgm ent under Rule 56 of the Federal Rules of Civil Procedure, holding that Defendants failed to carry their in itial burden of dem onstrating the absen ce of a genuin e issue of m aterial fact for trial. 5 Thus, the Court found Defendants were not entitled to sum m ary judgm ent that the Trust’s negligence claim s are perem pted under subsection A. In connection with their m otion for sum m ary judgm ent, Defendants filed a m otion to strike two affidavits attached to the Trust’s opposition to Defendants’ m otion for sum m ary judgm ent. 6 Having denied Defen dants’ m otion for sum m ary judgm ent, the 1 R. Doc. 30 . R. Doc. 31. 3 R. Docs. 30 -1; 31; 35. 4 E.D. La. No. 14-2715; Ban kr. No. 14-10 50 . 5 R. Doc. 29. 6 Bankr. No. 14-10 50 , R. Docs. 74-10 , 74-11. 2 1 Dockets.Justia.com Court denied Defendants’ m otion to strike as m oot. 7 The Court’s order denying Defendants’ m otion is an interlocutory order, as it did not adjudicate all of Plaintiffs’ claim s. Federal Rule of Civil Procedure 54(b) provides that “any order or other decision, however designated, that adjudicates fewer than all the claim s or the rights and liabilities of fewer than all the parties . . . m ay be revised at any tim e before the entry of a [final] judgm ent.”8 Although the district court has broad discretion to reconsider an interlocutory order for any reason it deem s sufficient, 9 this power “is exercised sparingly in order to forestall the perpetual reexam ination of orders and the resulting burdens an d delays.”10 Generally, the courts in this district evaluate a m otion to reconsider an interlocutory order under the sam e standards as those governing a m otion to alter or am end a final judgm ent brought pursuant to Rule 59(e) of the Federal Rules of Civil Procedure. 11 Such a m otion “m ust clearly establish either a m anifest error of law or fact or m ust present newly discovered eviden ce and can not be used to raise argum ents which could, and should, have been m ade before the judgm ent issued.”12 A m otion for reconsideration, however, “is ‘not the proper vehicle for rehashing evidence, legal theories, or argum ents that could have been offered or raised before the entry of [the 7 R. Doc. 29. Fed. R. Civ. P. 54(b). 9 See U.S. v. Renda, 70 9 F.3d 472, 479 (5th Cir. 20 13) (citation and internal quotation m arks om itted) (“Rule 54(b) authorizes a district court to reconsider and reverse its prior rulin gs on any interlocutory order for any reason it deem s sufficient.”) 10 Castrillo v. Am . Hom e Mortgage Servicing, Inc., No. 0 9-4369, 20 10 WL 1424398, at *3 (E.D. La. Apr . 5, 20 10 ) (Vance, J .). 11 See, e.g., id. at *3– 4 (“The gen eral practice of this court has been to evaluate m otions to reconsider interlocutory orders under the sam e standards that govern Rule 59(e) m otions to alter or am end a final judgm ent.”). However, there are som e circum stances in which a different standard would be appropriate. Id. (citing Am . Canoe Ass’n v. Murphy Farm s, Inc., 326 F.3d 50 5, 514– 16 (4th Cir. 20 0 3)). 12 Schiller v. Phy sicians Resource Group Inc., 342 F.3d 563, 567 (5th Cir.20 0 3) (citations and internal quotation m arks om itted). 8 2 order].’”13 “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.’”14 “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.”15 Under Rule 59(e), a m oving party m ust satisfy at least one of the following criteria: (1) whether the m ovant dem onstrates the m otion is necessary 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; (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. 16 Defendants urge the first and third options, arguing the Court’s order denying their m otion for sum m ary judgem ent is “predicated on m anifest errors of law and fact” and that “reconsideration is necessary in order to prevent m anifest injustice.”17 In their m otion, Defendants raise a host of errors. First, Defendants argue the Court failed to conduct a de novo review of the Bankruptcy Court’s proposed findings of fact and conclusions of law. 18 Second, Defendants contend the Court “cited to and presum ably relied, at least to an extent, upon the [a]ffidavits that were the subject of the [m ]otion to [s]trike without ruling upon the [m ]otion to [s]trike.”19 Finally, Defendants 13 Lacoste v. Pilgrim Int’l, 20 0 9 WL 1565940 , at *8 (E.D. La. J un e 3, 20 0 9) (Vance, J .) (quoting Tem plet v. Hy droChem Inc., 367 F.3d 473, 478 – 79 (5th Cir. 20 0 4)). 14 Castrillo, 20 10 WL 1424398, at *4 (alteration in origin al) (quotin g Tem plet, 367 F.3d at 479). 15 Lightfoot v. Hartford Fire Ins. Co., No. 0 7-4833, 20 12 WL 711842, at *3 (E.D. La. Mar. 5, 20 12). 16 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 seekin g reconsideration of final judgm ents. See Carter v . Farm ers Rice Milling Co., Inc., 33 F. App’x 70 4 (5th Cir. 20 0 2); Lightfoot v. Hartford Fire Ins. Co., 0 7-4833, 20 12 WL 711842, at *2 (E.D. La. Mar. 5, 20 12). 17 R. Doc. 30 -1 at 6. 18 Id. 19 Id. at 7. 3 subm it the Court “relied on an outdated Fifth Circuit case,” Gerdes v. Estate of Cush, 20 in its holding. 21 The Court considers each assertion in turn. A. De novo review Defendants contend the Court failed to conduct a de novo review of the Bankruptcy Court’s proposed findings of fact and conclusions of law. According to Defendants, “this Court has a duty to evaluate all argum ents m ade by the parties and addressed by the Bankruptcy Court in connection with [Defendants’] m otion for sum m ary judgm ent.”22 Defendants m isunderstand the scope of de novo review. Under the de novo standard of review, the appellate court acts as if it were considering the question in the first instance, affording no deference to the decisions below. 23 Additionally, to the extent Defendants com plain the Court did not consider argum ents they raised for the first tim e in their reply brief before the Bankruptcy Court and in their brief on appeal to this Court, the Court “will not entertain argum en ts raised for the first tim e on appeal,”24 and “will not consider argum ents raised for the first tim e in a reply brief.”25 Finally, the Court “will not raise and discuss legal issues [an appellant] has failed 20 953 F.2d 20 1 (5th Cir. 1992). 21 Id. 22 R. Doc. 30 -1 at 7 (em phasis added). United States v. Raddatz, 447 U.S. 667, 690 (1980 ) (Stewart, J ., dissenting) (describing de novo review as an assessm ent that is “unfettered by any prejudice from the [prior] agency proceeding and free from any claim that the [agency’s] determ ination is supported by substantial evidence.”); United States v. First City N at’l Bank of Hous., 386 U.S. 361, 368 (1967) (holding that “review de novo” m eans review requiring “an independent determ ination of the issues.”); see also Doe v. United States, 821 F.2d 694, 697– 98 (D.C. Cir. 1987) (en banc) (“De n ovo m eans here, as it ordin arily does, a fresh, indepen dent determ ination of ‘the m atter’ at stake; the court’s inquiry is not lim ited to or constricted by the adm inistrative record, nor is any deference due the agen cy’s conclusion.”). 24 Sm ith v. W om ans Hosp., 671 F. App’x 884, 8 87 (5th Cir. 20 16); Martco Ltd. P’ship v. W ellons, Inc., 58 8 F.3d 864, 877 (5th Cir. 20 0 9) (“[A]rgum ents not raised before the district court are waived and cannot be raised for the first tim e on appeal.”). 25 Cavazos v. JP Morgan Chase Bank N at’l Ass’n, 38 8 F. App’x 398 , 399 (5th Cir. 20 10 ); United States v. Jackson, 426 F.3d 30 1, 30 4 n.2 (5th Cir. 20 0 5) (“Argum ents raised for the first tim e in a reply brief, even by pro se litigants . . . are waived.”). 23 4 to assert.”26 The Court reiterates that the only argum ent raised in Defendants’ m otion for sum m ary judgm ent, in its entirety, is that: Because peremption is evident from the face of the Complaint and Amended Complaint, the Trustee bears the burden of proving perem ption is not applicable. Here, the Trustee’s Complaint alleges that Alfred acted improperly in connection with transactions between Forty Acre and C&R, which acts, omissions or errors occurred or were supposed to occur in 20 0 8. Thereafter, Alfred recorded a counter letter in May 20 09, and attem pted to negotiate C&R’s check in August 20 09. All of these acts or omissions occurred, however, more than three years before the Trustee filed the instant adversary proceeding on October 2, 2014. Therefore, under the provisions of La. R.S. 9:5605, claims arising out of those transactions are perem pted. Sim ilarly, in his Com plaint, the Trustee alleges that Alfred negligently advised Forty Acre to file for Chapter 11 bankruptcy in J anuary 11, 20 11, and then failed to file a plan of reorganization within the exclusivity period, or by May 11, 20 11, which acts and om ission s also occurred m ore than three years before the Trustee filed the instant adversary proceeding on October 2, 20 14. 27 In their statem ent of undisputed m aterial facts, Defendants did not include an y facts to show the Trust’s m alpractice claim s are based solely on negligence rather than fraud. 28 Instead, Defen dants sim ply listed the dates upon which certain events occurred, which does not establish that subsection A applies. In effect, Defendants argued the Court should assum e the Trust’s claim s are based on negligence, rather than fraud, and that as a result, subsection A applies. The Court found the Trust sufficiently alleged Alfred’s conduct am ounted to fraud, rendering subsection E, not A, applicable to its claim s. Because Defendants based their m otion for sum m ary judgm ent entirely on subsection A, the Court’s denial of Defendants’ m otion for sum m ary judgm ent was not an error of law, and reconsideration is not appropriate on that basis. 26 Brinkm ann v . Abner, 813 F.2d 744, 748 (5th Cir. 198 7). Bankr. No. 14-10 50 , R. Doc. 60 -1 at 11. 28 Bankr. No. 14-10 50 , R. Doc. 60 -3. 27 5 B. Motion to Strike Defendants next argue “it is clear that the Court reviewed the [a]ffidavits and as such, possibly considered the contents therein when m aking its ruling, as evidenced by the fact that the Order and Reasons cite to the [a]ffidavits.”29 In support of their contention, Defendants point to footnotes 5 and 12 of the Court’s order. 30 Footnote 5, states: The Court derives the factual background from the Trust’s am ended com plaint, Bankr. No. 14-10 50 , R. Doc. 42; Defendants’ statem ent of uncontested m aterial facts, Bankr. No. 14-10 50 , R. Doc. 60 -2; and the deposition transcript attached to the Trust’s opposition to the m otion for sum m ary judgm ent, Bankr. No. 14-10 50 , R. Doc. 74-4. The dates upon which Forty Acre’s reorganization plan and certain court orders were filed are derived from the Bankruptcy Court’s docket, Bankr. No. 14-10 50 . 31 Footnote 5 m akes no m ention of the stricken affidavits. Footnote 12 refers to an October 3, 20 13 letter sent from Alfred to the LeBlancs and Forty Acre term inating his representation, again without m ention of the affidavits. 32 The only citation in the Court’s order that refers to the stricken affidavits is footnote 15, which states “The Trust attached several exhibits to its Opposition to the m otion for sum m ary judgm ent in the Bankruptcy Court, including the affidavits of Queyrouze and Roberts.”33 The Order otherwise m akes no m ention of the stricken affidavits. The Court did not consider the affidavits. Reconsideration is not appropriate on this basis. C. Gerdes v. Estate of Cush Finally, Defendants argue the Court’s order “contains m anifest error of the law in 29 R. Doc. 30 -1 at 10 . Id. at 10 n .25. 31 R. Doc. 29 at 1 n.5. 32 Bankr. No. 14-10 50 , R. Doc. 74-12. This letter was attached as Exhibit “J ” to the Trust’s Mem orandum in Opposition to the Motion for Sum m ary J udgm ent. 33 R. Doc. 29 at 8 & n.15. 30 6 determ ining that the tim eliness of the breach of fiduciary duty claim is not governed by La. Rev. Stat. 9:560 5A.”34 Defendants apparently construe footnote 14, which cites to, inter alia, Gerdes v. Estate of Cush, as an essential part of the Court’s holding. In footnote 14, the Court referenced the fact that, although Defendants m entioned the Trust’s breach of fiduciary duty claim , they did not seek sum m ary judgm ent on that claim . 35 Because Defendants did not seek sum m ary judgm ent on the Trust’s breach of fiduciary duty claim , the Court’s com m ents on the applicable statute of lim itations as to such a claim is “not essential to the decision and therefore not binding.”36 Nevertheless, the Court notes that Gerdes v. Estate of Cush rem ain s the law of this Circuit. The Fifth Circuit in Gerdes held that if a claim involves a lawyer’s “selfdealing or a breach of the duty of loyalty,” then it is a breach of fiduciary duty claim . 37 “Where the attorney has breached the fiduciary duty to the client . . . the ten year prescriptive period [found in Louisiana Civil Code article 3499] applies.”38 “It is the practice of this Circuit for three-judge panels [and district courts] to abide by a prior Fifth Circuit decision until the decision is overruled, expressly or im plicitly, by either the United States Suprem e Court or by the Fifth Circuit sitting en banc.”39 Defendants point to no controlling authority that expressly or im plicitly overrules Gerdes. Moreover, other district courts in this Circuit continue to cite to Gerdes, reaching the sam e conclusion. 40 34 R. Doc. 30 -1 at 11. R. Doc. 29 at 8 n.14 (“The Court will not grant sum m ary judgm ent on a claim for which sum m ary judgm ent was not requested or supported.”). 36 Judicial Dictum , BLACK’S LAW D ICTIONARY (10 th ed. 20 14). 37 Gerdes, 953 F.2d at 20 4– 0 6. 38 Id. at 20 4. 39 United States v. Kirk, 528 F.2d 10 57, 10 63 (5th Cir. 1976); see also Causew ay Med. Suite v. Iey oub, 10 9 F.3d 10 96, 110 3 (5th Cir. 1997) (“Accordingly, for a pan el of this court to overrule a prior decision , we have required a Suprem e Court decision that has been fully heard by the Court and establishes a rule of law inconsistent with our own .”). 40 See Hiern v. Sarpy , No. 94-835, 1995 WL 640 528, at *13 (E.D. La. Oct. 31, 1995); N ew som e v . Mendler, No. 15-1195, 20 15 WL 50 12310 , at *4 n .1 (E.D. La. Aug. 20 , 20 15). 35 7 Thus, reconsideration is not warranted on this basis. Accordingly; CON CLU SION Defendants’ m otion for reconsideration is D EN IED . 41 N e w Orle a n s , Lo u is ian a, th is 2 8 th d ay o f D e ce m be r, 2 0 17. ________________________________ SU SIE MORGAN U N ITED S TATES D ISTRICT J U D GE 41 R. Doc. 30 . 8
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