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In re Queyrouze

United States District Court, E.D. Louisiana

December 28, 2017

IN RE QUEYROUZE, ET AL.

         SECTION: “E”

          ORDER AND REASONS

          SUSIE MORGAN UNITED STATES DISTRICT JUDGE

         Before the Court is Continental Casualty Company, Randall Alfred, and Alfred, APLC's (collectively “Defendants”) motion for reconsideration.[1] Steve Queyrouze, Plan Trustee for the Forty Acre Corporation Plan Trust (the “Trust”), opposes the motion.[2]The Court has reviewed the briefs, [3] the record, [4] and the applicable law, and now issues this order and reasons.

         DISCUSSION

         On November 9, 2017, this Court denied Defendants' motion for summary judgment under Rule 56 of the Federal Rules of Civil Procedure, holding that Defendants failed to carry their initial burden of demonstrating the absence of a genuine issue of material fact for trial.[5] Thus, the Court found Defendants were not entitled to summary judgment that the Trust's negligence claims are perempted under subsection A.

         In connection with their motion for summary judgment, Defendants filed a motion to strike two affidavits attached to the Trust's opposition to Defendants' motion for summary judgment.[6] Having denied Defendants' motion for summary judgment, the Court denied Defendants' motion to strike as moot.[7]

         The Court's order denying Defendants' motion is an interlocutory order, as it did not adjudicate all of Plaintiffs' claims. Federal Rule of Civil Procedure 54(b) provides that “any order or other decision, however designated, that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties . . . may be revised at any time before the entry of a [final] judgment.”[8] Although the district court has broad discretion to reconsider an interlocutory order for any reason it deems sufficient, [9] this power “is exercised sparingly in order to forestall the perpetual reexamination of orders and the resulting burdens and delays.”[10]

         Generally, the courts in this district evaluate a motion to reconsider an interlocutory order under the same standards as those governing a motion to alter or amend a final judgment brought pursuant to Rule 59(e) of the Federal Rules of Civil Procedure.[11] Such a motion “must clearly establish either a manifest error of law or fact or must present newly discovered evidence and cannot be used to raise arguments which could, and should, have been made before the judgment issued.”[12] A motion for reconsideration, however, “is ‘not the proper vehicle for rehashing evidence, legal theories, or arguments that could have been offered or raised before the entry of [the order].'”[13] “The Court is mindful that ‘[r]econsideration of a judgment after its entry is an extraordinary remedy that should be used sparingly.'”[14] “When there exists no independent reason for reconsideration other than mere disagreement with a prior order, reconsideration is a waste of judicial time and resources and should not be granted.”[15]

         Under Rule 59(e), a moving party must satisfy at least one of the following criteria:

(1) whether the movant demonstrates the motion is necessary to correct manifest errors of law or fact upon which the judgment is based;
(2) whether the movant presents new evidence;
(3) whether the motion is necessary in order to prevent manifest injustice; and
(4) whether the motion 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 motion for summary judgement is “predicated on manifest errors of law and fact” and that “reconsideration is necessary in order to prevent manifest injustice.”[17]

         In their motion, 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 presumably 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 submit 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 arguments made by the parties and addressed by the Bankruptcy Court in connection with [Defendants'] motion for summary judgment.”[22] Defendants misunderstand 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 complain the Court did not consider arguments they raised for the first time in their reply brief before the Bankruptcy Court and in their brief on appeal to this Court, the Court “will not entertain arguments raised for the first time on appeal, ”[24] and “will not consider arguments raised for the first time in a reply brief.”[25] Finally, the Court “will not raise and discuss legal issues [an appellant] has failed to assert.”[26]

         The Court reiterates that the only argument raised in Defendants' motion for summary judgment, 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 peremption 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 2008. Thereafter, Alfred recorded a counter letter in May 2009, and attempted to negotiate C&R's check in August 2009. 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 perempted.
Similarly, in his Complaint, the Trustee alleges that Alfred negligently advised Forty Acre to file for Chapter 11 bankruptcy in January 11, 2011, and then failed to file a plan of reorganization within the exclusivity period, or by May 11, 2011, which acts and omissions also occurred more than three years before the Trustee filed the instant adversary proceeding on October 2, 2014.[27]

         In their statement of undisputed material facts, Defendants did not include any facts to show the Trust's malpractice claims are based solely on negligence rather than fraud.[28] Instead, Defendants simply listed the dates upon which certain events occurred, which does not establish that subsection A applies. In effect, Defendants argued the Court should assume the Trust's claims 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 amounted to fraud, rendering subsection E, not A, applicable to its claims. Because Defendants based their motion for summary ...


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