United States District Court, D. Maryland, Southern Division
J. IIAZEL United States District Judge.
Securities & Exchange Commission ("SRC")
brought the present enforcement action against Defendant
Michael K. Martin ('"Martin") on May 11, 20] 5.
and has been attempting to obtain Martin's emails via
discovery since September 29. 2016. when Martin filed a
Motion to Stay Discovery. ECF No. 211. Presently pending
before the Court is Martin's Motion to Reconsider this
Court's September 25. 2017 Order holding Martin in
contempt for failing to consent to the release of his emails
by his service provider by sending an email granting
authorization (the "Consent Email"). ECF No. 336.
No hearing is necessary. See Loc. R. 105.6 (D. Md.
2016). For the following reasons. Defendants' Motion for
Reconsideration is denied.
December 29, 2016. the Court issued an Order directing Martin
to send a Consent Email to Yahoo. Inc.. his email service
provider, authorizing Yahoo to release Martin's account
information and certain of Martin's emails to the SEC:
specifically, the Yahoo email account with the Yahoo [D
""firstname.lastname@example.org." ECF No.
235. Martin did not comply with this Order, and on February
3, 2017. the Court issued another Order, directing Martin to
show cause why he should not be held in contempt. ECF No.
252. Plaintiff SEC has since endeavored to subpoena
Martin's emails from Yahoo directly, an effort which
Yahoo has opposed. See ECF No. 275. ECF No. 291. The
Court held a motions hearing on June 30. 2017 to hear
argument on the administrative subpoena issue, and Martin did
not appear. See ECF No. 307. On August 4, 2017. this
Court again ordered Martin to sign the Consent Email set
forth in ECF No. 235. a copy of which was attached to that
Order. ECF No. 321. The Court warned Martin that:
If Martin fails to do so within ten (10) days of this Order,
the Court will hold Martin in contempt pursuant to
Fed.R.Civ.P. 37(b)(2)(vii). Further, because Defendants'
funds have been frozen by the Court for the benefit of the
alleged victims, a monetary fine would not effectively compel
production in this case. Therefore, if the Court holds Martin
in contempt, it will also issue an arrest warrant and direct
that Martin be held by the U.S. Marshals until he complies
with this Order.
Id. at 2.
August 16. 201 7. during a telephone status call with the
parties. Martin stated that he would comply with this
Court's Order and send the Consent Email. ECF No. 323.
However, on August 18, 2017. the SEC provided this Court with
a copy of an "Amended Authorization for the Release of
Yahoo Emails." which Martin had sent to the SEC. Exhibit
A. The SEC takes the position that the document "fails
to comply with the Court's Order." and relayed to
the Court that Yahoo's counsel "confirmed that Yahoo
does not deem the so-called authorization sufficient to
permit it to release the emails sought by the
Commission." Indeed, despite the Court's explicit
instruction that Martin send the Consent Email contained in
ECF No. 235. Martin made a number of significant changes
before returning the document. Specifically. Martin's
gives his "protested signature" rather than his
"express consent." Compare Exhibit A
with Exhibit B. Furthermore, he gives Yahoo
permission to "disclose onlv logs, containing names and
addresses received and sent without attachments" rather
than "[a]ll emails, including deleted emails, together
with their attachments." Compare Exhibit A
with Exhibit B. Finally. Martin states that he
"do[es] not hold harmless Yahoo for the
disclosure." whereas the Consent Email provided that he
should "agree to hold harmless . . . Yahoo for the
disclosure." Compare Exhibit A with
September 25. 2017. the Court held Martin in contempt of
court and ordered that an arrest warrant would be issued for
Martin, to be held in abeyance until 12 noon on October 2.
2017; the Court ordered that if Martin complied with the
Court's order and signed the Consent Email prior to that
time, the court would indefinitely stay the arrest warrant.
ECF No. 335 at 3. Rather than complying with this Order,
however, on September 26, 2017. Martin filed a Motion for
Reconsideration. ECF No. 336. In his Motion for
Reconsideration. Martin generally asks the Court to
"deny the . . . |SEC]'s application for
mandated/compelled disclosure of Defendant Martin's Yahoo
email account." Id. at 1. Specifically. Martin
makes a litany of arguments -which are at times difficult to
parse through - including that the compelled production of
his emails violates his Fourth and Fifth Amendment rights,
along with his Attorney-Client Privilege. See Id. at
4. 6-16. On September 27. 2017. the SEC tiled an Opposition
to Martin's Motion, arguing that Martin "merely
rehashes arguments that this Court previously rejected."
and that Martin is not entitled to a reconsideration of the
Court's prior orders. ECF No. 338 1. 4.
STANDARD OF REVIEW
Martin does not cite to a particular Federal Rule permitting
reconsideration of the Court's prior decision, because no
final judgment has been entered in this case. Martin's
Motion is controlled by Rule 54(b) of the Federal Rules of
Civil Procedure. That rule provides. in relevant part:
[A]ny 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); see also Cezair v. JP Morgan Chase
Bank. N.A., No. CIV.A. DKC 13- 2928. 2014 WL 4955535. at
*1 (D. Md. Sept. 30. 2014) (citing Fayetteville Investors
v. Commercial Builders. Inc.. 936 F.2d 1462. 1469-70
(4th Cir. 1991)) ("It is well-established that the
appropriate Rule under which to file motions for
reconsideration of an interlocutory order is Rule
54(b)"). The power to grant relief under Rule 54(b)
"is committed to the discretion of the district
court." Am. (anoe Ass'n v. Murphy Farms,
inc., 326 F.3d 505. 515 (4th Cir. 2003) (citing
Moses H. Com Mem. Hasp. v. Mercury Const. C
'orp.. 460 U.S. 1. 12. 103 S.Ct. 927 (1983)).
United States Court of Appeals for the Fourth Circuit has not
defined the precise standard governing a motion for
reconsideration under Rule 54(b). See Fayetteville.
936 F.2d at 1472. Courts in this district have, however,
frequently looked toward the standards articulated in Rules
59(e) and 60(b) for guidance in considering such motions.
See C 'ezair. 2014 WL 4955535, at *1 (citing
Akeva. LLC v. Adidas Am., Inc.,385 F.Supp.2d 559.
565-66 (M.D. N.C. 2005)). Thus, "[m]ost courts have
adhered to a fairly narrow set of grounds on which to
reconsider their interlocutor) 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.".Ikera. 385 F.Supp.2d at 565-66:
see also Innes v. Bd. of Regents of the Univ. Sys. of
Md.121 F.Supp.3d 504. 506-07 (I). Md. 2015) (applying
this three-part test when evaluating a motion for
reconsideration under Rule 54(h)). importantly, "a
motion to reconsider is not proper where it only asks the
Court to rethink its prior decision, or presents a better or
more compelling argument that the party could have presented