United States District Court, E.D. Louisiana
ORDER AND REASONS
ANN VIAL LEMMON UNITED STATES DISTRICT JUDGE.
IS HEREBY ORDERED that plaintiff's
Motion for Reconsideration (Rec. Doc. 66) is
order entered on March 28, 2019 (Rec. Doc. 65), the court
dismissed plaintiff's claim against defendant Graystar
Mortgage, LLC ("Graystar") for rescission under
TILA and HOEPA, finding that though Graystar was an assignee
of plaintiff's loan, it had received nothing from Johnson
beyond the security interest, which had been released by
Graystar, and thus there was nothing left to rescind.
now seeks reconsideration pursuant to Rule 54(b), arguing
that the allegations of the complaint and exhibits thereto,
as well as newly discovered documentation, reflect that
Graystar did in fact receive payment of principal and
interest from Johnson that is subject to her right of
rescission, in connection with the 2016 transaction. Detailed
facts are set forth in the court's prior order, and are
not restated here. For purposes of the instant motion, the
following facts suffice.
2016, Johnson borrowed $60, 000 from Investor Equities at
12%. Investor Equities did not have the cash on hand, so to
fund the loan, it borrowed $60, 000 from Graystar at 18%.
Investor Equities assigned the Johnson mortgage to Graystar
as collateral for its loan. In 2017, the loan matured.
Johnson then borrowed $75, 000 from Investor Equities. Of the
proceeds, $60, 453.79 was sent to Graystar. The HUD-1 for the
second (2017) loan reflects this payment as a settlement
charge to borrower (Betty Johnson) for "Payoff 1st
mortgage to Graystar Mortgage, LLC." At issue is whether
this was a payment from Johnson to Graystar, or whether it
was merely a pass-through via which Investor Equities paid
off its debt to Graystar.
Standard - Rule 54(b) Reconsideration
54(b) of the Federal Rules of Civil Procedure states, in
[A]ny order or other decision, however designated, that
adjudicates fewer than all the claims or the rights and
liabilities of fewer than all the parties does not end the
action as to any of the claims or parties and may be revised
at any time before the entry of a judgment adjudicating all
the claims and all the parties' rights and liabilities.
this rule, the district court “possesses the inherent
procedural power to reconsider, rescind, or modify an
interlocutory order for cause seen by it to be
sufficient.” Melancon v. Texaco, Inc., 659
F.2d 551, 553 (5th Cir. 1981). However, the district court
must exercise this broad discretion sparingly to forestall
the perpetual reexamination of orders and the resulting
burdens and delays. See Calpecto 1981 v. Marshall
Exploration, Inc., 989 F.2d 1408, 1414-15 (5th Cir.
1993); 18B Charles A. Wright & Arthur R. Miller, Federal
Practice and Procedure § 4478.1(2d ed. 2002).
general practice in the United States District Court for the
Eastern District of Louisiana has been to evaluate motions to
reconsider interlocutory orders under ths same standards that
apply to motions to alter or amend final judgments made
pursuant to Rule 59(e) of the Federal Rules of Civil
Procedure. See Rosemond v. AIG Ins., 2009 WL
1211020, at *2 (E.D. La. 5/4/09) (Barbier, J.); In re
Katrina Canal Breaches, 2009 WL 1046016, at *1 (E.D. La.
4/16/09) (Duval, J.); Castrillo v. Am. Home Mortg.
Servicing, Inc., 2010 WL 1434398, at *3-4 (E.D. La.
4/5/10) (Vance, J.). A Rule 59(e) motion calls into question
the correctness of a judgment. In re Transtexas Gas
Corp., 303 F.3d 571, 581 (5th Cir. 2002). “Rule
59(e) is properly invoked to correct manifest errors of law
or fact or to present newly discovered evidence.”
In re Transtexas Gas Corp., 303 F.3d at 581.
“A Rule 59(e) motion should not be used to relitigate
prior matters that should have been urged earlier or that
simply have been resolved to the movant's
dissatisfaction.” In re Self, 172 F.Supp.2d
813, 816 (W.D. La. 2001).
the Truth in Lending Act, "[w]hen an obligor exercises
his right to rescind . . . he is not liable for any finance
or other charge, and any security interest given by the
obligor, including any such interest arising by operation of
law, becomes void upon such a rescission." 15 U.S.C.
connection with the previous motion, Graystar argued that it
never received any payments from Johnson, and that the
payment it received was from Investor Equities, who was in
turn paid by Johnson. It based this argument on record
documents suggesting that the loan from Graystar to Investor
Equities was simply a mechanism to fund the proceeds Investor
Equities distributed to Johnson, and which was buttressed by
the fact that at the time of the 2017 loan, Graystar
relinquished its security interest. The court's prior
Order and Reasons found that although Graystar was an
assignee of ...