IN RE: ATP Oil & Gas Corporation, No. 2:2015cv03141 - Document 81 (E.D. La. 2016)
Court Description: ORDER AND REASONS denying 76 Motion for Entry of Judgment under Rule 54(b); denying 77 Motion for Entry of Judgment under Rule 54(b). Signed by Judge Sarah S. Vance on 6/30/16. (jjs)
Download PDF
<![CDATA[
IN RE: ATP Oil & Gas Corporation Doc. 81 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA RODNEY TOW, TRUSTEE CIVIL ACTION VERSUS NO: 15-3141 T. PAUL BULMAHN, ET AL. SECTION: R ORD ER AN D REASON S Before the Court are two m otions for entry of final judgm ent under Federal Rule of Civil Procedure 54(b), one filed by the Director Defendants 1 and one filed by Officer Defendants G. Ross Frazer, Isabel Plum e, and Robert M. Shivers III.2 For the following reasons, the Court denies both m otions. I. BACKGROU N D This case arises out of the dem ise of ATP Oil & Gas Corporation, a Texas- based oil and gas com pany that filed for bankruptcy in August 20 12.3 Rodney Tow, the Chapter 7 Trustee for ATP, filed this lawsuit against a num ber of ATP's form er officers and directors, alleging gross m ism anagem ent and 1 R. Doc. 77. 2 R. Doc. 76. 3 Unless otherwise noted, the Court draws its factual account from its order granting the Director Defendants' and Officer Defendants' m otions to dism iss the Second Am ended Com plaint. See R. Doc. 71. Dockets.Justia.com various form s of unlawful conduct. In his Second Am ended Com plaint, the Trustee alleged that beginning in May 20 10 , the Officer Defendants 4 and Director Defendants 5 breached fiduciary duties they owed to ATP and its creditors. The Trustee also sought to void cash and stock bonuses paid to certain Officer Defendants as fraudulent transfers. Finally, the Trustee alleged that each Officer Defendant and Director Defendant conspired with and/ or aided and abetted other defendants in breaching their fiduciary duties and allowing the distribution of fraudulent transfers. On April 29, 20 16, the Court granted Rule 12(b)(6) m otions to dism iss filed by the Officer Defendants and Director Defendants. Finding that the Trustee's request for leave to am end his complaint was generally unwarranted, the Court dism issed m ost of the Trustee's claim s with prejudice. Nonetheless, the Court granted the Trustee twenty-one days to am end his pleadings to better allege two causes of action: (1) his breach of fiduciary duty claim against Officer Defendant Bulm ahn for allegedly causing ATP to enter unfavorable contracts to benefit his "friends"; and (2) his fraudulent transfer claim s 4 The "Officer Defendants" are T. Paul Bulm ahn, Leland Tate, Albert L. Reese, J r., George R. Morris, Keith R. Godwin, Pauline van der Sm an-Archer, Isabel Plum e, Robert M. Shivers III, and G. Ross Frazer. 5 The "Director Defendants" are Burt A. Adam s, Arthur H. Dilly, Brent M. Longnecker, Robert J . Karow, Gerard J . Swonke, Chris A. Brisack, George R. Edwards, and Walter Wendlandt. 2 seeking to void cash and stock bonuses paid to certain Officer Defendants. On May 18, 20 16, the Trustee filed a one-count Third Am ended Com plaint.6 As am ended, the pleadings assert only fraudulent transfer claim s against Officer Defendants Bulm ahn, Tate, Reese, Morris, and Godwin. The Trustee does not re-allege his breach of fiduciary duty claim against Officer Defendant Bulm ahn; nor does he assert any claim s whatsoever against the Director Defendants or Officer Defendants Sm an-Archer, Plum e, Shivers, or Frazer. The Director Defendants and Officer Defendants Plum e, Shivers, and Frazer now ask the Court to enter a final judgm ent as to the Trustee's claim s against them under Rule 54(b).7 The Trustee opposes both m otions.8 II. D ISCU SSION Rule 54(b) provides, in pertinent part: When m ore than one claim for relief is presented in an action, whether as a claim , counterclaim , cross-claim , or third-party claim , or when m ultiple parties are involved, the court m ay direct the entry of a final judgm ent as to one or m ore but fewer than all of the claim s or parties only upon an express determ ination that there is no just reason for delay and upon an express direction for the entry of judgm ent. 6 R. Doc. 72. 7 R. Docs. 76, 77. 8 R. Docs. 78, 79. 3 Fed. R. Civ. P. 54(b). The Fifth Circuit has noted that "[o]ne of the prim ary policies behind requiring a justification for Rule 54(b) certification is to avoid piecem eal appeals." PYCA Indus., Inc. v. Harrison County W aste Mgm t., 81 F.3d 1412, 1421 (5th Cir. 1996). It explained that Rule 54(b) judgm ents are not favored and should be awarded only when necessary to avoid injustice: "A district court should grant certification [in a Rule 54(b) case] only when there exists som e danger of hardship or injustice through delay which would be alleviated by im m ediate appeal; it should not be entered routinely as a courtesy to counsel." Id. (citing Ansam Assocs., Inc. v. Cola Petroleum , Ltd., 760 F.2d 442, 445 (2d Cir. 1985)). The threshold inquiry for this Court is whether "there is no just reason for delay," a determ ination that is within the sound discretion of the district court. See Ackerm an v. FDIC, 973 F.2d 1221, 1224 (5th Cir. 1992). In m aking this determ ination, the district court has a duty to weigh "the inconvenience and costs of piecem eal review on the one hand and the danger of denying justice by delay on the other." Road Sprinkler Fitters Local Union v. Continental Sprinkler Co., 967 F.2d 145, 148 (5th Cir. 1992) (quoting Dickinson v. Petroleum Conversion Corp., 338 U.S. 50 7, 511 (1950 )). A m ajor factor the district court should consider is whether the appellate court "'would have to decide the sam e issues m ore than once even if there were subsequent 4 appeals." H & W Indus., Inc. v. Form osa Plastics Corp., USA, 860 F.2d 172, 175 (5th Cir. 1988) (quoting Curtiss– W right Corp. v. General Elec. Co., 446 U.S. 1, 8 (1980 )). After weighing the appropriate factors, the Court finds that certification is inappropriate in this case. The Director Defendants and Officer Defendants Frazer, Plum e, and Shivers fail to convince the Court that "there exists som e danger of hardship or injustice through delay which would be alleviated by im m ediate appeal." PYCA Indus., Inc., 81 F.3d at 1421 (holding that the district court abused its discretion by certifying an appeal without a finding of hardship). While both sets of defendants suggest that they would harm ed by delayed appellate review of the Court's April 29, 20 16 order, the risk of being brought back into litigation after a final judgm ent and appeal is present in every case in which claim s are dism issed against som e defendants but not others. Defendants provide no facts or argum ent dem onstrating that this is the sort of "infrequent harsh case" that Rule 54(b) was designed to address. See Jasm in v. Dum as, 726 F.2d 242, 244 (5th Cir. 1984). Further, litigation between the Trustee and Officer Defendants Bulmahn, Tate, Reese, Morris, and Godwin rem ains unresolved and could result in an appeal. Given the interrelatedness of the Trustee's breach of fiduciary duty, conspiracy, aiding and abetting, and fraudulent transfer claim s against all of 5 the defendants in this case, an entry of judgm ent against som e of the defendants could require an appellate court to decide the sam e issues on m ultiple occasions. Thus, the risk of piecem eal review outweighs the danger of denying justice by delay. III. CON CLU SION For the foregoing reasons, the Court DENIES both m otions for entry of final judgm ent under Rule 54(b). New Orleans, Louisiana, this _ _ _ day of J une, 20 16. 30th ___________________________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE 6
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
