Opinion
Case No. 5:99 CV 818
November 7, 2002
MEMORANDUM OPINION
This matter is before the Court on the Receiver's motion to alter or amend the July 8, 2002 judgment of this Court with regard to the prior receiver, Frederick M. Luper. (Doc. No. 1007.) In that decision, the Court declined to grant the Receiver's motion to order Luper to return funds wrongfully paid to individual investors during the course of his tenure as the Court-appointed Receiver in this litigation. The Receiver requests an amendment to the July 8, 2002 Judgment to include a certification allowing an interlocutory appeal and Luper concurs. The Crivello investors, also identified as the Mize Group, oppose the Receiver's motion.
Jurisdiction of the Court is predicated under 28 U.S.C. § 1331. Having considered the memoranda on this issue, for the reasons that follow, the Receiver's motion is well taken.
MOTION TO ALTER OR AMEND
The purpose of a motion to alter or amend judgment under Fed.R.Civ.P. 59(e) is to have the court reconsider matters "properly encompassed in a decision on the merits." Osterneck v. Ernst and Whitney, 489 U.S. 169, 174 (1989). This rule gives the district court the "power to rectify its own mistakes in the period immediately following the entry of judgment." White v. New Hampshire Dept. of Employment Sec., 455 U.S. 445, 450 (1982). Generally, there are three major situations which justify a district court altering or amending its judgment: "(1) to accommodate an intervening change in controlling law; (2) to account for new evidence not available at trial; or (3) to correct a clear error of law or to prevent a manifest injustice." In re Continental Holdings, Inc., 170 B.R. 919, 933 (Bankr. N.D. Ohio 1994); Braun v. Champion Credit Union, 141 B.R. 144, 146 (Bankr. N.D. Ohio 1992), aff'd, 152 B.R. 466 (ND. Ohio 1993); In re Oak Brook Apartments of Henrico County, Ltd., 126 B.R. 535, 536 (Bankr. S.D. Ohio 1991). It is not designed to give an unhappy litigant an opportunity to relitigate matters already decided; nor is it a substitute for appeal. Dana Corp. v. United States, 764 F. Supp. 482, 488-89 (N.D. Ohio 1991); Erickson Tool Co. v. Balas Collet Co., 277 F. Supp. 226 (N.D. Ohio 1967), aff'd, 404 F.2d 35 (6th Cir. 1968).
In this instance, it appears to the Court that the Receiver's basis for seeking an interlocutory appeal is to prevent a manifest injustice in that to delay a final determination by the appellate court would undermine the spirit of judicial economy in this particular case and could delay distribution of funds to defrauded investors. While the Receiver indicates that he intends to appeal the Court's determination, he requests a ruling allowing an interlocutory appeal under either 28 U.S.C. § 1292 or Fed.R.Civ.P. 54(b). The Court considers the parties' positions.
DISCUSSION
I Rule 54(b) A. Rule 54(b) Standard
Rule 54(b) of the Federal Rules of Civil Procedure provides that:
(b) Judgment Upon Multiple Claims or Involving Multiple Parties. When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.
Rule 54(b) was enacted as "a response to the need created by the liberal joinder provisions of the Federal Rules of Civil Procedure to revise `what should be treated as a judicial unit for purposes of appellate jurisdiction.'" Corrosioneering v. Thyssen Environmental Systems, 807 F.2d 1279, 1282 (6th Cir. 1986) (citation omitted). The Rule "`attempts to strike a balance between the undesirability of piecemeal appeals and the need for making review available at a time that best serves the needs of the parties.'" Id. (citations omitted). The determination of whether to allow for an appeal pursuant to Rule 54(b) is a matter left to the discretion of the district court. Id. B. Entry of Final Judgment
The first requirement for Rule 54(b) certification is that this Court "direct the entry of final judgment as to one or more but fewer than all the claims or parties." Fed.R.Civ.P. 54(b). That requirement appears to be partially satisfied in the instant case. "[T]he concept of a `claim' under Rule 54(b) denotes the aggregate of operative facts which give rise to a right enforceable in the courts." General Acquisition, Inc. v. Gencorp., Inc., 23 F.3d 1022, 1028 (6th Cir. 1994) (internal quotation and citation omitted). The "operative facts" which gives rise to a claim against Luper are distinct from those raised against Capwill or the claims asserted by the various victims and/or creditors. Since the Receiver's claim against Luper implicates distinct legal rights and a final determination on the claims therein, the entry of summary judgment in Luper's favor constitutes final judgment with respect to that claim. See Downie v. City of Middleburg Heights, 301 F.3d 688, 693 (6th Cir. 2002).
C. No Just Reason to Delay Appellate Review
In addition to satisfaction of the multiple claims requirement, Rule 54(b) also requires that this Court make an "express determination that there is no just reason for delay" of appellate review. Fed.R.Civ.P. 54(b). The Sixth Circuit set forth a "nonexhaustive list" of factors for the district court to consider in Corrosioneering, supra, as follows:
(1) the relationship between the adjudicated and the unadjudicated claims; (2) the possibility that the need for review might or might not be mooted by future developments in the district court; (3) the possibility that the reviewing court might be obliged to consider the same issue a second time; (4) the presence or absence of a claim or counterclaim which could result in set-off against the judgment sought to be made final; (5) miscellaneous factors such as delay, economic and solvency considerations, shortening the time of trial, frivolity of competing claims, expense and the like. Depending upon the factors of the particular case, all or some of the above factors may bear upon the propriety of the trial court's discretion in certifying a judgment as final under Rule 54(b).
Corrosioneering, 807 F.2d at 1283 (quoting Allis-Chambers Corp. v. Philadelphia Electric Co., 521 F.2d 360 (3d Cir. 1975)).
Mindful of the Sixth Circuit's admonition that Rule 54(b) appeal should be limited to "infrequent harsh case[s]", Rudd Construction Equip. Co., Inc. v. Home Ins. Co., 711 F.2d 54, 56 (6th Cir. 1983), this Court believes that an analysis of the Corrosioneering factors mitigates in favor of certification of this recovery claim asserted against Luper. The relationship between the adjudicated and unadjudicated claims is such that they would be most efficiently dealt with in a single proceeding.
There is little possibility that the need for review of the claim against Luper will be made moot by adjudication as this claim is tangentially related to the remaining claims. The Crivello investors argue that a determination of a contract-based allocation would effectively moot the claim against Luper as his previous payment to those investors would be deemed valid. However, this Court's recent determination of a pro rata allocation has also been certified for an interlocutory appeal under 28 U.S.C. § 1292 (b). Resolution by the Sixth Circuit of the method of disbursement as well as the claim against Luper, can only serve to expedite a resolution of this matter and afford some measure of relief to the victims, many of whom lost their life's savings.
If certification is not granted, the Luper matter will proceed on appeal at the conclusion of this case and delay the finalization of distribution of funds. In the event certification is successful, upon return to this Court, the amount of funds contained in the Receivership estate would be well defined and ready for actual disbursement. There is no just reason to delay appeal of the this recovery claim against Luper. Judicial economy is clearly served by certifying the final judgment as to that claim for appeal.
CONCLUSION
For the foregoing reasons and in order to prevent manifest injustice, the Receiver's Motion to Alter or Amend (Doc. No. 1666) is granted. This Court's July 8, 2002 determination (Doc. Nos. 1647 and 1648) are certified for appeal pursuant to Rule 54(b) as there is no just reason to delay appeal of the claim against Luper.
IT IS SO ORDERED.