United States District Court, W.D. Tennessee, Western Division
H. MAYS, JR. UNITED STATES DISTRICT JUDGE
the Court are two motions. First, on September 15, 2016,
Plaintiff Peach REO, LLC (“Peach REO”) filed a
Motion to Reopen. (ECF No. 77 (“Second Mot. to
Reopen”).) Defendants Richard K. Rice
(“RKR”), Malcolm Kyle Rice (“MKR”),
and Thomas F. Schaffler (“TFS”) -- collectively,
“Defendants” -- have not filed a response to the
Second Motion to Reopen, and the deadline for doing so has
passed. L.R. 7.2(a)(2).
on September 15, 2016, Peach REO filed a Motion for Charging
Order. (ECF No. 78 (“Charging-Order Mot.”).) On
September 30, 2016, MKR filed a response to the
Charging-Order Motion. (Resp. and Mem. in Opp'n to
Pl.'s Mot. for Charging Order, ECF No. 80
(“Charging-Order Resp.”); see also Aff.
of Malcolm Kyle Rice, ECF No. 79 (“MKR Aff.”).)
RKR and TFS have not responded to the Charging-Order Motion,
and the deadline for do- ing so has passed. L.R. 7.2(a)(2).
On October 11, 2016, Peach REO filed a reply in support of
the Charging-Order Motion. (Reply in Supp. of Mot. for
Charging Order, ECF No. 81 (“Charging-Order
following reasons, the Motion to Reopen is DENIED and the
Charging-Order Motion is GRANTED in part and DENIED in part.
history of this case was summarized in the March 2014 order
granting Peach REO's summary-judgment motion and in the
September 2016 order denying Peach REO's first motion to
reopen. (Order Granting Pl.'s Mot. for Summ. J., ECF No.
72 (“March 2014 Order”); Order on Pl.'s Mot.
to Reopen, ECF No. 76 (“September 2016 Order”).)
Since the Court entered the September 2016 Order, Peach REO
has filed the Second Motion to Reopen and the Charging-Order
Motion, MKR has filed the Charging-Order Response, and Peach
REO has filed the Charging-Order Reply.
Second Motion to Reopen
Second Motion to Reopen seeks the relief Peach REO requested
in its June 2016 Motion to Reopen. (Compare Second
Mot. to Reopen with Mot. to Reopen, ECF No. 74
(“First Mot. to Reopen”).) Both ask the Court to
“reopen” this case “so that [Peach REO] may
engage in post-judgment execution that requires orders from
the Court.” (Second Mot. to Reopen 1; see
also First Mot. to Reopen 1 (similar request).) The
First Motion to Reopen was denied. (September 2016 Order.)
The Court construes the Second Motion to Reopen as a motion
for reconsideration of the September 2016 Order.
standards governing the Second Motion to Reopen are unclear.
Peach REO does not identify the Rule that applies. (See
generally Second Mot. to Reopen.) The First Motion to
Reopen shared this flaw. (See September 2016 Order 2
(“Peach REO does not cite any rule or statute as
grounds for its Motion. It does not offer any relevant tests
for the Court to apply.”).) The Second Motion to Reopen
cites Rule 69(a)(1) and section 48-249-509 of the Tennessee
Code (Second Mot. to Reopen 1). Neither provides a standard
for assessing the Second Motion to Reopen.
54(b) governs revision of certain orders “before the
entry of a judgment adjudicating all the claims and all the
parties' rights and liabilities.” A judgment
adjudicating all claims and the parties' rights and
liabilities has been entered in this matter. (See
note 1 supra.) Rule 54(b) does not apply. Rule 59
governs motions to alter or amend a judgment, and Rule 60(b)
governs motions for relief from “a final judgment,
order, or proceeding.” The relief sought in the Second
Motion to Reopen does not correspond to either rule.
Court need not resolve this question. Under the Federal Rules
and this district's Local Rules, movants seeking
reconsideration or revision must generally show special
circumstances that compel revisiting a prior order or
judgment (e.g., new material facts, court mistake, etc.).
See, e.g., Fed.R.Civ.P. 60(b) (setting requirements
for motions for relief from judgments); L.R. 7.3(b) (setting
district requirements for Rule 54(b) motions). Determining
which rule applies is unnecessary if the Court considers the
motion on its merits.
Second Motion to Reopen is without merit for the same reasons
that the First Motion to Reopen was without merit. As the
September 2016 Order explained:
After entering a judgment, a district court retains ancillary
jurisdiction to ensure the judgment's execution. The
Federal Rules of Civil Procedure provide for this . . . . The
Sixth Circuit has observed that “‘[t]he scope of
postjudgment discovery is very broad.'” After entry
of judgment, Peach REO is a judgment creditor and Defendants
are judgment debtors. Plaintiff may obtain discovery from
Defendants to the extent [Rule] 69(a)(2) allows, and the
Court need not “reopen” the case for Peach REO to
2016 Order 3 (citations and footnote omitted).)
in the Second Motion to Reopen supports a different analysis.
Peach REO states that it has filed a motion for a charging
order, and that “[a] charging order . . . requires
action by this Court, as a court of competent
jurisdiction.” (Second Mot. to Reopen ¶ 5.) Peach
REO also states that it “anticipates filing additional
motions for execution that require orders from the Court
and/or writs to be issued by the Clerk.” (Id.
¶ 6.) Peach REO cites no authority for the proposition
that this Court must reopen the case to be a “court of
competent jurisdiction” and does not explain why the
orders or writs it contemplates require reopening the case.
This Court has ancillary jurisdiction to ensure that its
previously entered judgment is executed. It will exercise
that jurisdiction as appropriate based on the parties'
requests. Reopening the case is unnecessary.
Second Motion to Reopen is DENIED.
Charging-Order Motion prays for relief in four paragraphs.
(Charging-Order Mot. 2-3.) Paragraph 1 seeks a charging order
“against the interests of [MKR]” in eight
limited-liability companies (“LLCs”): (1) Cash
Depot of Mississippi, LLC (“CDM”); (2) Cash Depot
of Tennessee, LLC (“CDT”); (3) Cash Depot Title
Loans of MS, LLC (“CDTLM”); (4) Palladian
Partners IV, LLC (“PPIV”); (5) Palladian Partners
2001 LLC (“PP2001”); (6) Financial Management
Services, LLC (“FMS”); (7) Palladian Partners V,
LLC (“PPV”); and (8) M. Kyle Rice Properties, LLC
(“MKRP”). (Id. at 2.) Paragraph 2 asks
that the charging order “direct that [Peach REO] has
the rights, to the full extent of the Judgment entered in
favor of [Peach REO] against [MKR], as a transferee of the
financial rights of [MKR]” in the eight LLCs.
(Id. at 2-3.)
REO alleges that MKR is a member of PPIV and MKRP.
(Charging-Order Mot. 2.) MKR denies this. (Charging-Order
Resp. ¶ 2; MKR Aff. ¶ 9.) The Charging-Order Reply
does not address MKR's denial. (See generally
Charging-Order Reply.) The charging-order remedy applies when
a judgment debtor is a member of an LLC. See, e.g.,
Larry E. Ribstein & Robert R. Keatinge, Ribstein and
Keatinge on Limited Liability Companies § 7:8
(2017). When a judgment debtor is not a member of an LLC, the
charging-order remedy is inappropriate as to that LLC. On
this record, the Court cannot determine whether MKR is a
member of PPIV or MKRP. The request for a charging order as
to PPIV and MKRP is DENIED. In what follows, the remaining
six LLCs -- CDT, FMS, CDM, CDTLM, PP2001, and PPV -- will be
referred to as the “Relevant LLCs.”
Charging-Order Motion invokes Rule 69(a)(1). (Charg-ing-Order
Mot. ¶ 3.) Under Rule 69(a)(1),
A money judgment is enforced by a writ of execution, unless
the court directs otherwise. The procedure on execution --
and in proceedings supplementary to and in aid of judgment or
execution -- must accord with the procedure of the state
where the court is ...