United States District Court, D. Maryland
THE HUMANE SOCIETY OF THE UNITED STATES, et al.
NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA
DEBORAH K. CHASANOW United States District Judge
pending and ready for resolution in this insurance coverage
dispute is the motion for reconsideration and clarification
filed by Plaintiff The Humane Society of the United States
(“HSUS” or “Plaintiff”). (ECF No.
138). The court now rules, no hearing being deemed necessary.
Local Rule 105.6. For the following reasons, Plaintiff's
motion will be denied.
complete recitation of the factual background can be found in
the prior memorandum opinion resolving the motion for summary
judgment filed by Defendant National Union Fire Insurance
Company of Pittsburgh, Pa. (“National Union” or
“Defendant”). (See ECF No. 84, at 1-7).
Plaintiff, along with Plaintiffs Jonathon Lovvorn and
Kimberly Ockene (collectively, “Plaintiffs”),
filed the initial complaint in this case in the Circuit Court
for Montgomery County, and Defendant removed the action to
this court. (ECF Nos. 1; 2). Plaintiffs asserted a
claim for insurance coverage against Defendant in connection
with a lawsuit filed against HSUS by Feld Entertainment, Inc.
under a 2009-2010 insurance policy (the “2009-2010
Policy”). (ECF No. 2 ¶¶ 15; 36). The original
scheduling order set August 15, 2013, as the deadline for the
amendment of pleadings. (ECF No. 11, at 2). The parties
completed discovery on October 10, 2014, and Defendant moved
for summary judgment on November 20, 2014 (ECF No. 68). On
July 30, 2015, the court issued a memorandum opinion and
order granting in part and denying in part Defendant's
motion for summary judgment. (ECF Nos. 84; 85). The court
entered judgment in favor of Defendant on a portion of the
breach of contract claim, concluding that “no coverage
is available for HSUS under the 2009-2010 Policy, ” but
denied Defendant's summary judgment motion as to the
individual plaintiffs. (ECF No. 84, at 25-39).
September 8, 2015, Plaintiffs expressed their intent to seek
leave to file an amended complaint for the first time (ECF
No. 86), and on September 28, Plaintiffs filed a motion for
leave to amend (ECF No. 90). In the proposed amended
complaint, Plaintiffs sought to add claims for breach of
contract and declaratory judgment under two additional
insurance policies sold by Defendant to HSUS: Policy No.
965-95-51, for the period January 1, 2007, to June 1, 2008
(the “2007-2008 Policy”); and Professional
Liability Insurance for Corporate Counsel, Policy No.
01-950-29-84, for the period June 1, 2009, to June 1, 2010
(the “Employed Lawyers Policy”). (See
ECF No. 90-2).
10, 2016, while Plaintiffs' motion for leave to amend was
pending, Plaintiff HSUS filed the same claims it was seeking
leave to bring in this action as a new action against
Defendant in this court. Complaint, The Humane Soc'y
of the U.S. v. Nat'l Union Fire Ins. Co. of Pittsburgh,
Pa., No. PWG 16-2029 (D.Md. June 10, 2016), ECF No. 1.
That case is pending before the Honorable Paul W. Grimm.
Plaintiffs did not withdraw their motion for leave to amend
or inform the court of the filing of the new action.
11, 2016, the court denied the motion for leave to amend.
Plaintiffs' motion had addressed only the liberal
standards of Rule 15(a) and not the good cause necessary to
modify the scheduling order under Rule 16(b). (ECF Nos. 98;
99). The court held that, even considering the arguments on
good cause that had been advanced only in the reply brief,
Plaintiffs failed to show good cause for modifying the
scheduling order because they failed to establish that they
exercised diligence in seeking leave to amend. (ECF No. 98,
at 8-16). The court found that Plaintiffs had long known the
underlying facts in this matter and could have either
included the proposed claims in the complaint or added those
claims before the expiration of the scheduling order
deadline. (Id. at 12). Instead, Plaintiffs
had “deliberately elected not to include any claim
under either the 2007-2008 D&O Policy or the Employed
Lawyers Policy in the complaint” and had “waited
until more than two months following the summary judgment
opinion to seek leave to amend the complaint.”
(Id. at 11-12). Plaintiffs first sought leave to
amend the complaint more than two years after the scheduling
order deadline, nearly a year after discovery had concluded,
and two months after Defendant's summary judgment motion
had been decided. The court determined that this delay showed
a lack of diligence and would prejudice Defendant.
(Id. at 13-14). Finally, although it was not
necessary to consider Plaintiffs' Rule 15 arguments
because Plaintiffs had failed to show good cause for
modifying the scheduling order under Rule 16, the opinion
also noted that denial of leave to amend under Rule 15 was
appropriate when the amendment would prejudice the non-moving
party, and “determine[d] that Defendant would be
prejudiced by Plaintiffs' proposed amendments.”
(Id. at 16 & n.7).
Motion for Reconsideration
instant motion, HSUS asks for reconsideration of the denial
of leave to amend in light of the January 27, 2017, decision
by the Court of Appeals of Maryland in a case filed against
Defendant by The Fund for Animals (“FFA”), an
affiliate of HSUS, regarding coverage for the same Feld
litigation under HSUS's 2007-2008 Policy. (ECF No. 138);
see Nat'l Union Fire Ins. Co. of Pittsburgh, Pa. v.
The Fund for Animals, Inc., 451 Md. 431 (2017).
Plaintiff argues that the decision of the Court of Appeals
affirming the entry of a judgment of liability on the
2007-2008 Policy in favor of FFA and against National Union
is entitled to collateral estoppel effect in this case. (ECF
No. 138-7, at 17-18). Plaintiff contends that it should be
granted leave to amend its complaint to add its own claim
against National Union under the 2007-2008 Policy because
liability has already been determined. Therefore, Plaintiff
argues, there would be no prejudice to Defendant and no
impact on the imminent trial in this case on its pending
claim for defense costs incurred by the two individual
plaintiffs. (See Id. at 17-22).
Standard of Review
moves for reconsideration under Fed.R.Civ.P. 54(b), which
governs reconsideration of an interlocutory order. See
Fayetteville Inv'rs v. Commercial Builders, Inc.,
936 F.2d 1462, 1469-70 (4th Cir. 1991). Rule 54(b)
provides that “any order or other decision, however
designated, that adjudicates fewer than all the claims or the
rights and liabilities of fewer than all the parties . . .
may be revised at any time before the entry of a judgment
adjudicating all the claims and all the parties' rights
and liabilities.” Fed.R.Civ.P. 54(b). In the United
States Court of Appeals for the Fourth Circuit, the precise
standard governing a motion for reconsideration of an
interlocutory order is unclear. Fayetteville
Inv'rs, 936 F.2d at 1472. While the standards
articulated in Rules 59(e) and 60(b) are not binding in an
analysis of Rule 54(b) motions, Am. Canoe Ass'n v.
Murphy Farms, Inc., 326 F.3d 505, 514 (4th
Cir. 2003), courts frequently look to these standards for
guidance in considering such motions, Akeva, LLC v.
Adidas Am., Inc., 385 F.Supp.2d 559, 565-66 (M.D. N.C.
Public policy favors an end to litigation and recognizes that
efficient operation requires the avoidance of re-arguing
questions that have already been decided. Most courts have
adhered to a fairly narrow set of grounds on which to
reconsider their interlocutory orders and opinions. Courts
will reconsider an interlocutory order in the following
situations: (1) there has been an intervening change in
controlling law; (2) there is additional evidence that was
not previously available; or (3) the prior decision was based
on clear error or would work manifest injustice.
Akeva, 385 F.Supp.2d at 565-66 (citations omitted);
see also Beyond Sys., Inc. v. Kraft Foods, Inc., No.
PJM-08-409, 2010 WL 3059344, at *1-2 (D.Md. Aug. 4, 2010)
(applying this three-part test when evaluating a motion for
reconsideration under Rule 54(b)). A motion for
reconsideration under Rule 54(b) may not be used merely to
reiterate arguments previously rejected by the court.
Beyond Sys., Inc., 2010 WL 3059344, at *2.