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Cincinnati Insurance Co. v. Grand Pointe

May 30, 2007

CINCINNATI INSURANCE COMPANY; PLAINTIFF,
v.
GRAND POINTE, LLC, ET AL, DEFENDANTS.
RLI INSURANCE COMPANY, PLAINTIFF,
v.
GRAND POINTE, LLC, ET AL, DEFENDANTS.



The opinion of the court was delivered by: Chief Judge Curtis L. Collier

MEMORANDUM

Before the Court is Defendants Grand Pointe, LLC; Century Construction of Tennessee, LLC, a Tennessee Limited Liability Company; Century Construction of Tennessee, LLC, an Alabama Limited Liability Company; Southern Century, LLC; CEMC IV, L.P.; Clifford Byrd Harbour, III; and Robert H. Chandler's (collectively referred to as "Defendants") motion to reconsider, alter, amend, or vacate this Court's memorandum opinion and order dated August 11, 2006 which granted summary judgment in favor of Plaintiff RLI Insurance Company ("RLI") and found RLI does not have a duty to defend Defendants in an underlying lawsuit (Court File No. 155).

RLI filed a response brief in opposition (Court File No. 161). For the following reasons, the Court will DENY Defendants' motion to reconsider, alter, amend, or vacate (Court File No. 155).

I. STANDARD OF REVIEW

Defendants rely on Federal Rule of Civil Procedure 59(e) ("Rule 59(e)") and Federal Rule of Civil Procedure 60 ("Rule 60") in support of their motion for reconsideration.*fn1 Rule 59(e) authorizes motions to alter or amend a judgment if filed within ten days after entry of the judgment. The Court's previous order was entered on August 11, 2006 and Defendants filed their motion to reconsider on April 10, 2007. More than ten (10) days have elapsed, accordingly, Defendants may not rely upon Rule 59(e).

Under Rule 60, a court has discretion to provide relief from a judgment or order upon a showing of cause within a reasonable time. Rule 60(a) addresses clerical errors. Rule 60(b) addresses all other bases for reconsideration:

On motion and upon such terms as are just, the court may relieve a party or a party's legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment.

FED. R. CIV. P. 60(b). With regard to the catch-all provision of Rule 60(b)(6), the United States Court of Appeals for the Sixth Circuit ("Sixth Circuit") has stated:

Rule 60(b)(6) should apply only in exceptional or extraordinary circumstances which are not addressed by the first five numbered clauses of the Rule. Courts, however, must apply subsection (b)(6) only as a means to achieve substantial justice when something more than one of the grounds contained in Rule 60(b)'s first five clauses is present.

Olle v. Henry & Wright Corp., 910 F.2d 357, 365 (6th Cir. 1990) (citations and quotation marks omitted).

Motions to reconsider under Rule 60(b) are "opportunit[ies] for [the district court] to correct manifest errors of law or fact and to review newly discovered evidence or to review a prior decision when there has been a change in the law." United States v. Davis, 939 F. Supp. 810, 812 (D. Kan. 1996). Rule 60(b) motions are addressed to the sound discretion of the district court, which must balance the ends of justice with public interest in the finality of the court's decisions. FHC Equities, L.L.C. v. MBL Life Assurance Corp., 188 F.3d 678, 683 (6th Cir. 1999); Aetna Cas. & Sur. Co. v. Home Ins. Co., 882 F. Supp. 1355, 1356 (S.D.N.Y. 1995). Such motions seek extraordinary judicial relief and can be granted only upon a showing of exceptional circumstances. McAlpin v. Lexington 76 Auto Truck Stop, Inc., 229 F.3d 491, 502-03 (6th Cir. 2000). "[A] Rule 60(b) motion is not a substitute for an appeal." Kai Wu Chan v. Reno, 932 F. Supp. 535, 539 (S.D.N.Y. 1996).

II. FACTS

The Court has already outlined the applicable facts in its previous memorandum opinions (Court File Nos. 105 & 114); however, in the interest of clarity, the Court will state the facts relevant to a determination of the current motion under consideration. Two insurance companies, RLI and Cincinnati Insurance Company ("Cincinnati") brought the present actions (which were consolidated) in this Court seeking a declaration they have no duty to defend or indemnify Defendants and for reimbursement of all fees and costs incurred in providing Defendants a defense in an Alabama lawsuit (Court File Nos. 105 & 114). In the underlying action multiple condominium unit owners brought suit in Baldwin County, Alabama against several entities and individuals that developed and/or constructed a condominium building in Orange Beach, Alabama (Defendants in the current action). Id. These suits basically allege specific condominium units were not worth the promised value because they were incomplete and not as luxurious as promised. Id.

Both insurance companies filed motions for summary judgment (Court File Nos. 47 & 57). For the purposes of clarity, the Court addressed these motions in separate memorandum opinions. On June 29, 2006 the Court entered a memorandum opinion and order granting Cincinnati's motion for summary judgment and declaring Cincinnati does not have a duty to defend or indemnify the Defendants in connection with the lawsuit filed in Alabama (Court File Nos. 105 & 106). On July 7, 2006 Defendants filed motions to alter or amend the Court's order granting Cincinnati's motion for summary judgment (Court File Nos. 108 & 110). Specifically, Defendants requested the Court to: (1) withdraw its prior order and stay the case until the Tennessee Supreme Court issued a decision in the case of Travelers Indem. Co. of Am. v. Moore & Assoc., Inc., No. M2004-01233-COA-R3-CV, 2005 WL 2293009 (Tenn. Ct. App. Sept. 20, 2005), (2) certify questions to the Tennessee Supreme Court regarding the relevant issues, or (3) simply reverse its earlier opinion (Court File No. 116). The Court was unwilling to stay the case, certify questions to the ...


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