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Houston Specialty Insurance Co. v. Ascension Insulation & Supply Inc.

United States District Court, W.D. Louisiana, Shreveport Division

November 5, 2018

HOUSTON SPECIALTY INSURANCE CO.
v.
ASCENSION INSULATION & SUPPLY, INC., ET AL.

          MARK L. HORNSBY MAG. JUDGE.

          RULING

          TERRY A. DOUGHTY UNITED STATES DISTRICT JUDGE.

         Pending before the Court is a Rule 59(e) Motion to Reconsider and Amend Judgment on Behalf of Plaintiff Houston Specialty Insurance Co. (“Houston Specialty”) [Doc. No. 58]. Defendants Adam Whatley and Carly Whatley and Ascension Insulation & Supply, Inc. (“Ascension”) filed memoranda in opposition to the motion. [Doc. Nos. 64 & 65]. Houston Specialty filed a reply memorandum. [Doc. No. 66]. For the following reasons, the motion is GRANTED IN PART and DENIED IN PART.

         I. Procedural History

         Houston Specialty previously filed a Motion for Summary Judgment [Doc. No. 22], and Ascension filed a related Motion to Strike [Doc. No. 43]. On July 25, 2018, Magistrate Judge Hornsby issued a Report and Recommendation [Doc. No. 53] in which he recommended that the Court deny both motions. Magistrate Judge Hornsby further recommended that the Court exercise its discretion and dismiss the Complaint without prejudice given the effect factual development and/or trial in the related state court matter could have on this lawsuit.

         After conducting a de novo review of the entire record, including Houston Specialty's objections, the Court issued a Ruling adopting Magistrate Judge Hornsby's Report and Recommendation, denying the motions, and dismissing the action. [Doc. Nos. 56 & 57].

         However, on September 19, 2018, Houston Specialty filed the instant motion moving the Court to reconsider its Ruling and Judgment. The motion is fully briefed, and the Court is prepared to rule.

         II. Law and Analysis

         The Federal Rules of Civil Procedure do not recognize a motion for reconsideration per se. Instead, a timely filed motion challenging a final judgment is considered under Rule 59(e) as a motion to alter or amend judgment.

         A Rule 59(e) motion “calls into question the correctness of a judgment.” Templet v. HydroChem Inc., 367 F.3d 473, 479 (5th Cir. 2004) (quoting In re Transtexas Gas Corp., 303 F.3d 571, 581 (5th Cir. 2002)). The Fifth Circuit has held that this type of motion is not to be used to rehash “evidence, legal theories, or arguments that could have been offered or raised before the entry of judgment.” Id. The purpose of a Rule 59(e) motion is to allow a party “to correct manifest errors of law or fact or to present newly discovered evidence.” Id. (citation and internal quotation marks omitted). If a Rule 59(e) motion is based on newly discovered evidence, then a court should grant the motion only if “(1) the facts discovered are of such a nature that they would probably change the outcome; (2) the facts alleged are actually newly discovered and could not have been discovered earlier by proper diligence; and (3) the facts are not merely cumulative or impeaching.” Infusion Res., Inc. v. Minimed, Inc., 351 F.3d 688, 696-97 (5th Cir. 2003) (citation omitted).

         With regard to the denial of Houston Specialty's Motion for Summary Judgment, the Court finds no manifest error of law or fact and declines to reconsider its ruling and judgment.

         With regard to the dismissal of this action, however, the Court finds that Houston Specialty has stated a basis for alteration of the ruling and judgment. Houston Specialty brought this action under the Declaratory Judgment Act, and after further review of the relevant case law, the Court finds that it should exercise its discretion to retain jurisdiction over this matter.

The Declaratory Judgment Act, 28 U.S.C. § 2201(a), “is an enabling act, which confers discretion on the courts rather than an absolute right on a litigant.” Wilton v. Seven Falls Co., 515 U.S. 277, 287, 115 S.Ct. 2137, 2143, 132 L.Ed.2d 214 (1995) (quoting Public Serv. Comm'n of Utah v. Wycoff Co., 344 U.S. 237, 241, 73 S.Ct. 236, 239, 97 L.Ed. 291 (1952)). “The Declaratory Judgment Act has been understood to confer on federal courts unique and substantial discretion in deciding whether to declare the rights of litigants.” Wilton, 515 U.S. at 286, 115 S.Ct. at 2142. “In the declaratory judgment context, the normal principle that federal courts should adjudicate claims within their jurisdiction yields to considerations of practicality and wise judicial administration.” Wilton, 515 U.S. at 289, 115 S.Ct. at 2143.

Sherwin-Williams Co. v. Holmes Cty., 343 F.3d 383, 389 (5th Cir. 2003). “The Fifth Circuit uses the Trejo factors to guide a district court's exercise of discretion to accept or decline jurisdiction over a declaratory judgment suit.” Id. at 390; see St. Paul Ins. Co. v. Trejo,39 F.3d ...


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