Opinion
No. 99 Civ. 11395 (RWS).
September 26, 2001.
MEMORANDUM OPINION
Defendant Douglas C. Brandon ("Brandon") has moved for reconsideration of the June 27, 2001 order of this Court (the "June 27 Order") which denied the Receiver's motion for summary judgment to strike the sixth affirmative defense of the Third-Party Defendants, Certain Underwriters at Lloyds London, London Market Companies and Gulf Insurance Company ("Lloyds Underwriters") For the reasons set forth below, the motion to reconsider is denied but can be converted to a motion for summary judgment by letter application.
Brandon has sought reconsideration of the June 27 Order insofar as it relates to his coverage under the Directors and Officers portion ("DO") and the Financial Institutions Professional Indemnity portion ("FIPI") of the Primary Policy issued to Credit Bancorp and a declaration that the Lloyds Underwriters' sixth affirmative defense, which seeks to void coverage based on an allegation that Credit Bancorp submitted claims relating to certain shares of Fortune Financial and Colorado Casino ("fraudulent claims defense"), does not preclude coverage for Brandon on the grounds that this was overlooked in the June 27 Order.
The standards controlling a motion for reconsideration are set forth in Fed.R.Civ.P. 59(e) and Local Rule 6.3. Fulani v. Brady, 149 F.R.D. 501, 503 (S.D.N.Y. 1993). Reargument is appropriate where the court has "overlooked controlling decisions or factual matters that were put before it on the underlying motion," Davis v. The Gap, Inc., 186 F.R.D. 322, 323 (S.D.N.Y. 1999), and which, had they been considered, "might reasonably have altered the result before the Court." Consolidated Gold Fields v. Anglo American Corp., 713 F. Supp. 1457, 1476 (S.D.N.Y. 1989).
The standards governing Rule 59(e) and Local Rule 6.3 have been held by this Court to be the same. Davis v. The Gap, Inc., 186 F.R.D. 322, 323 (S.D.N.Y. 1999). To be entitled to reargument, the movant "must demonstrate that the Court overlooked controlling decisions or factual matters that were put before it on the underlying motion." Id. at 324. (Citations omitted). Local Rule 6.3 is "to be narrowly construed and strictly applied so as to avoid repetitive arguments on issues that have been considered fully by the court." Id.
However, Brandon did not move for summary judgment to grant the relief under the DO and FIPI sections of the Primary Policy which he now seeks. Brandon argued that the Underwriters' cross-motion for summary judgment on the affirmative defense should be denied on the grounds that a fraudulent claim defense would be unavailing.
The Receiver did not move for summary judgment on the issue now raised by Brandon in either his initial moving papers or his reply to Underwriters' cross-motion, but suggested to the Court that it had the power to grant summary judgment dismissing Underwriters' sixth affirmative defense to the non-movant, and that such a judgment "would be appropriate, given that the Insurers have not made out even a prima facie case." (Receiver's Reply Memorandum of law dated February 16, 2001 ("Rec. rep. Br.") at 46 n. 40)
In the June 27 Order, summary judgment was denied with respect to the sixth affirmative defense on the grounds that the parties had raised an issue of material fact. Neither Brandon nor the Receiver moved for summary judgment to preclude the Underwriters from asserting the fraudulent claims defense against Brandon, and therefore the instant motion does not apprise the Court of "overlooked controlling decisions or factual matters," Davis v. The Gap, Inc., supra, 186 F.R.D. at 324, but seeks in essence to move for summary judgment. Resorting to Rule 59(e) for such relief is inappropriate and is denied. Id. ("a party in its motion for reargument `may not advance new facts, issues or arguments not previously presented to the court.'").
Since the relief sought by the motion to reconsider was not sought upon the underlying motion which resulted in the June 27 Order, reconsideration and reargument are inappropriate. However, the issue raised is a real one, and in the interests of justice and expediency, can be raised by treating the papers in support of the motion to reconsider as constituting a motion for summary judgment with an opportunity to the Lloyds Underwriters to answer in a summary judgment context. The parties may rely on the papers already submitted or submit any additional material and may give notice of their intention in letter form.
It is so ordered.