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Calmat Co. v. Oldcastle Precast, Inc.

United States District Court, D. New Mexico

June 18, 2018

CALMAT CO., Plaintiff,
v.
OLDCASTLE PRECAST, INC., Defendant.

          MEMORANDUM OPINION AND ORDER

         This matter comes before the Court upon Rune Kraft's “Objection and Motion for Reconsideration of Order Entered as Document 189” (Motion for Reconsideration), filed on December 13, 2017. (Doc. 201). Defendant Oldcastle Precast, Inc. (Oldcastle) filed a response on December 28, 2017, and Rune Kraft (Kraft) filed a reply on January 4, 2018. (Docs. 214 and 224). Having reviewed the Motion for Reconsideration and the accompanying briefs, the Court grants the Motion for Reconsideration, in part, as described below.

         A. Background

         On December 4, 2017, the Court entered an “Order on Motion to [Set] Aside Order to Show Cause (Doc. 177) and Motion for Attorneys' Fees as Sanctions Pursuant to Rule 11 (Doc. 158)” (Order). (Doc. 189). The Court noted in the Order that on April 12, 2017, it

entered an Order to Show Cause [OTSC] requiring Rune Kraft to appear in person, at the Las Cruces, New Mexico, Federal Courthouse, on June 29, 2017, “to show cause why he should not be sanctioned, by monetary sanctions, a finding of contempt, and/or a referral to the State Bar of New Mexico for the unauthorized practice of law, for continuing to file pleadings as a non-lawyer on behalf of his business entities….” (Doc. 132) at 4.

(Doc. 189) at 1-2. The OTSC also stated that “Kraft's failure to appear for the in-person show cause hearing may result in additional sanctions for disobeying a Court order….” Id. at 2 (quoting (Doc. 132) at 4).

         The Court further noted in the Order that it had already denied Kraft's first motion to set aside the OTSC. Id. The Court then denied Kraft's second motion to set aside the OTSC (Doc. 177), which was then before the Court, and addressed the merits of the OTSC. Id. at 7. The Court concluded that Kraft “failed to show cause why he should not be sanctioned for filing ‘pleadings as a non-lawyer on behalf of his business entities.'” Id. (quoting (Doc. 132) at 4).

         Consequently, the Court imposed the following sanctions under the OTSC. First, the Court ordered that Kraft, personally, pay reasonable attorneys' fees and costs incurred by Oldcastle in responding to Kraft's May 22, 2017, motion to dismiss (Doc. 154). (Doc. 189) at 7. The Court reasoned that this sanction was justifiable under the OTSC because Kraft unlawfully brought the motion to dismiss (Doc. 154) on behalf of Kraft Americas L.P. (Doc. 189) at 7. Second, the Court ordered that Kraft, personally, pay reasonable fees and costs incurred by Oldcastle in filing its May 24, 2017, motion for attorneys' fees and costs (Doc. 158). (Doc. 189) at 8. The Court based the second sanction on the fact that Oldcastle brought the motion for attorneys' fees and costs (Doc. 158), in part, because “Kraft purposefully violated the Local Rules and several court orders by filing documents on behalf of KAHI and Kraft Americas L.P.” (Doc. 189) at 8.

         Given the above sanctions imposed pursuant to the OTSC, the Court did not decide Oldcastle's motion for attorneys' fees and costs (Doc. 158) and denied that motion as moot. (Doc. 189) at 8. Finally, the Court acknowledged that Oldcastle did not serve the motion for attorneys' fees and costs (Doc. 158) on Kraft, but found that the lack of service was immaterial in light of the decision to deny the motion for attorneys' fees and costs (Doc. 158) as moot. (Doc. 189) at 8.

         Kraft now asks that the Court reconsider the Order and the Court's imposition of sanctions under the OTSC.

         B. Motion for Reconsideration Standard

         The Tenth Circuit has analyzed motions to reconsider interlocutory orders, like this one, under Fed. R. Civ. R. 54(b)[1] and looked to Fed.R.Civ.P. 59(e) for guidance in addressing those motions to reconsider. Ankeney v. Zavaras, 524 Fed.Appx. 454, 458 (10th Cir. 2013) (stating that, in considering Rule 54(b) motion to reconsider, “court may look to the standard used to review a motion made pursuant to Federal Rule of Civil Procedure 59(e).”). A Rule 59(e) movant carries the burden of demonstrating that the Court should alter or amend a judgment. See, e.g., Winchester v. Wilkinson, 2015 WL 2412175, at *2 (E.D. Okla.) (“court finds petitioner has failed to meet his burden for relief under Fed.R.Civ.P. 59(e).”).

         Rule 59(e) relief is appropriate if there is new controlling law, new evidence not available previously, or if there is a “need to correct clear error or prevent manifest injustice.” Ankeney, 524 Fed.Appx. at 458 (quoting Servants of the Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir. 2000)). The Tenth Circuit has defined clear error as “an arbitrary, capricious, whimsical, or manifestly unreasonable judgment.” Wright ex rel. Trust Co. of Kan. v. Abbott Labs., Inc., 259 F.3d 1226, 1236 (10th Cir. 2001). Although the Tenth Circuit has not specifically defined manifest injustice in the Rule 59(e) context, other courts have defined manifest injustice as “more than just a clear and certain prejudice to the moving party, but also a result that is fundamentally unfair in light of governing law.” Smith v. Lynch, 2015 WL 4324167, *3 (D.D.C.). See also In re Green Goblin, Inc., 2012 WL 1971143, *1 (Bankr. E.D. Pa. May 31, 2012) (“In order for a court to reconsider a decision due to ‘manifest injustice, ' the record presented must be so patently unfair and tainted that the error is manifestly clear to all who view it.”) (quoting In re Roemmele, 466 B.R. 706 (Bankr. E.D. Pa. 2012)). Rule 59(e) does not allow a losing party to “revisit issues already addressed or advance arguments that could have been raised in prior briefing.” Servants of the Paraclete, 204 F.3d at 1012.

         C. Discussion

         As an initial matter, Kraft notes that Oldcastle does not directly dispute all of the arguments raised in the Motion for Reconsideration. Kraft argues that Oldcastle, therefore, must agree with those arguments. See D.N.M. LR-Cv 7.1(b) (failure to file response “constitutes consent to grant the motion.”). However, the Tenth Circuit prefers that the Court address the merits of a motion. See Lee v. Max Int'l, LLC, 638 F.3d 1318, 1321 (10th Cir. 2011) (“our legal system strongly prefers to decide cases on their merits.”). In keeping with that Tenth Circuit tenet, the Court can waive a local rule “to avoid injustice, ” i.e., decide a motion on the merits. D.N.M. LR-Cv 1.7. Moreover, it is ...


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