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Aggreko, LLC v. American Home Assurance Co.

United States District Court, E.D. Louisiana

December 5, 2014

AGGREKO, LLC,
v.
AMERICAN HOME ASSURANCE COMPANY, SECTION:

ORDER AND REASONS

CARL J. BARBIER, District Judge.

Before the Court is a Motion for Reconsideration (Rec. Doc. 23) filed by Plaintiff Aggreko, LLC and Defendant American Home Assurance Company's opposition thereto. (Rec. Doc. 25) Having considered the motion and memoranda of counsel, the record, and the applicable law, the Court finds that the motion should be DENIED for the reasons set forth more fully below.

PROCEDURAL HISTORY AND BACKGROUND FACTS[1]

This Court granted Defendant's motion to dismiss and entered judgment in favor of Defendant on September 15, 2014. (Rec. Docs. 21, 22) The Court found that both mandatory and discretionary abstention were warranted in this case. First, the Court reasoned that the abstention analysis set out in Orix Credit Alliance, Inc. v. Wolfe, 212 F.3d 891, 895 (5th Cir. 2000) mandated abstention here. Specifically, the Court noted that although Defendant herein had not previously filed a state action against the declaratory Plaintiff, a third party had filed a state action against both declaratory Plaintiff and Defendant that would address the issue that the declaratory action raised. The Court went on to find that even if mandatory abstention were unwarranted, the Court would decline to exercise its discretion to decide the declaratory action under St. Paul Insurance Co. v. Trejo, 39 F.3d 585 (5th Cir. 1994).

Plaintiff filed the instant Motion for Reconsideration (Rec. Doc. 23) on October 14, 2014.[2] Defendant opposed the motion on November 10, 2014. (Rec. Doc. 25)

PARTIES' ARGUMENTS

Plaintiff argues that the Court's September 15, 2014, Order (Rec. Doc. 21) granting Defendants' Motion to Dismiss (Rec. Doc. 9) suffers from manifest errors in law. (Rec. Doc. 23) First, Plaintiff argues that the Court improperly found mandatory abstention appropriate despite the absence of one of the three prerequisites for mandatory abstention. (Rec. Doc. 23-3, pp. 5-7) Specifically, declaratory Defendant had not previously filed a state action against declaratory Plaintiff; rather, a third party filed suit against both declaratory Plaintiff and Defendant. Id . Second, Plaintiff argues that the Court erred in abstaining and declining to exercise its discretion to hear the declaratory action. Id. at 7-13. Plaintiff contends that the Court granted discretionary abstention after considering only the first Trejo factor: whether both the pending state and federal actions involve the same state law issues. Id. at 8-9. Plaintiff further argues that the Court erred by either improperly articulating or addressing the second, third, fourth, and sixth Trejo factors. Id. at 9-13.

Defendant asserts that the Court's September 15, 2014, Order suffers from no manifest error of law, and therefore, Plaintiff cannot meet the standard under Federal Rule of Civil Procedure 59(e) for reconsideration. (Rec. Doc. 25, pp. 1-2) Defendant argues that Plaintiff merely wishes to relitigate the Court's adverse ruling. Id. at 1. Defendant states that mandatory abstention does not require the declaratory Defendant to have previously filed a state action against the declaratory Plaintiff. Id. at 2-4. As a result of Louisiana's Direct Action Statute, Defendant was not required to file a separate state action against Plaintiff to assert its coverage defense. Id. at 3. Because the "relevant inquiry is whether there are competing state and federal proceedings, '" it is sufficient for application of mandatory abstention that the issue that Plaintiff's declaratory action presents was previously joined in the state action. Id. at 3 (quoting Nat'l Cas. Co. v. DeQueen, Inc., No. 13-5851, 2013 WL 6004055, at *2 (E.D. La. Nov. 13, 2013)). Finally, Defendant disputes Plaintiff's contention that this Court improperly evaluated the Trejo factors. Id. at 4-10. Defendant therefore maintains that both mandatory and discretionary abstention were appropriate here.

LEGAL STANDARD

Altering or amending a judgment under Rule 59(e) is an "extraordinary remedy" used "sparingly" by the courts. Templet v. Hydrochem, Inc., 367 F.3d 473, 479 (5th Cir. 2004). A motion to alter or amend calls into question the correctness of a judgment and is permitted only in narrow situations, "primarily to correct manifest errors of law or fact or to present newly discovered evidence." Id .; see also Schiller v. Physicians Res. Grp. Inc., 342 F.3d 563, 567 (5th Cir. 2003). Manifest error is defined as "[e]vident to the senses, especially to the sight, obvious to the understanding, evident to the mind, not obscure or hidden, and is synonymous with open, clear, visible, unmistakable, indubitable, indisputable, evidence, and self-evidence.'" In Re Energy Partners, Ltd., 2009 WL 2970393, at *6 (Bankr.S.D.Tex. Sept. 15, 2009) (citations omitted); see also Pechon v. La. Dep't of Health & Hosp., 2009 WL 2046766, at *4 (E.D. La. July 14, 2009) (manifest error is one that "is plain and indisputable, and that amounts to a complete disregard of the controlling law'") (citations omitted).

The Fifth Circuit has noted that "such a motion is not the proper vehicle for rehashing evidence, legal theories, or arguments that could have been offered or raised before entry of judgment." Templet, 367 F.3d at 478-79. Nor should it be used to "re-litigate prior matters that... simply have been resolved to the movant's dissatisfaction." Voisin v. Tetra Techs., Inc., No. 08-1302, 2010 WL 3943522, at *2 (E.D. La. Oct. 6, 2010). Thus, to prevail on a motion under Rule 59(e), the movant must clearly establish at least one of three factors: (1) an intervening change in the controlling law, (2) the availability of new evidence not previously available, or (3) a manifest error in law or fact. Schiller, 342 F.3d at 567; Ross v. Marshall, 426 F.3d 745, 763 (5th Cir. 2005) (to win a Rule 59(e) motion, the movant "must clearly establish either a manifest error of law or fact or must present newly discovered evidence").

DISCUSSION

The Declaratory Judgment Act provides, in relevant part: "In a case of actual controversy within its jurisdiction... any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought." 28 U.S.C. ยง 2201(a). In Wilton v. Seven Falls Co., 515 U.S. 277 (1995), the United States Supreme Court made it clear that, because the Declaratory Judgment Act is "an enabling Act, which confers a discretion on the courts rather than an absolute right upon the litigant, '" the district court has "unique and substantial discretion in deciding whether to declare the rights of litigants." Id. at 287-88. Even when a declaratory action is justiciable and within the Court's authority to decide, the Court must still determine whether to exercise its discretion to decide or dismiss the action. Sherwin-Williams Co. v. Holmes Cnty., 343 F.3d 383, 387 (5th Cir.2003)(citing Orix, 212 F.3d at 895).

The United States Court of Appeals for the Fifth Circuit has identified a three-step inquiry for determining whether to decide or dismiss a complaint for declaratory relief. Orix, 212 F.3d at 895; see also Sherwin-Williams Co., 343 F.3d at 387. The first step requires a determination of whether the declaratory action is justiciable. Id . (citing Rowan Cos. v. Griffin, 876 F.2d 26, 27-28 (5th Cir.1989)). "Second, if it has jurisdiction, then the district court must resolve whether it has the authority' to grant declaratory relief in the case presented." Orix, 212 F.3d at 895 (citing Travelers Ins. Co. v. La. Farm Bureau Fed'n, Inc., 996 F.2d 774, 776 (5th ...


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