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Founders Insurance Co. v. Richard Ruth's Bar & Grill LLC

United States District Court, D. South Carolina, Charleston Division

February 1, 2017

FOUNDERS INSURANCE COMPANY, Plaintiff,
v.
RICHARD RUTH'S BAR & GRILL LLC, RICHARD RUTH, SR., JANE RUTH, and GEORGE GIANNARAS, as guardian for EMMANUEL KEHAGIAS, Defendants. RICHARD RUTH'S BAR & GRILL LLC, RICHARD RUTH, SR., and JANE RUTH, and GEORGE GIANNARAS, as guardian for EMMANUEL KEHAGIAS, Plaintiffs,
v.
FOUNDERS INSURANCE COMPANY, BROWN & BROWN, INC., HULL & COMPANY, INC., and UTICA MUTUAL INSURANCE COMPANY, Defendants.

          ORDER

          DAVID C. NORTON UNITED STATES DISTRICT JUDGE

         This matter comes before the court on various motions filed by declaratory judgment action (2:13-cv-03035-DCN) defendant and bad faith action (2:14-cv-03272-DCN) plaintiff George Giannaras, as Guardian for Emmanuel Kehagias (“Kehagias”), pursuant to Federal Rule of Civil Procedure 59(e). Specifically, Kehagias filed the following three motions: (1) a motion to alter and/or amend the court's order denying Kehagias's motion for summary judgment and granting Founders Insurance Company's (“Founders”) motion for summary judgment, ECF No. 221, thereby holding that Founders is not required to provide coverage under the policy; (2) a motion to alter or amend the court's order granting Brown & Brown, Inc.'s (“Brown”) motion for summary judgment and granting Hull & Company, Inc.'s (“Hull”) motion for summary judgment, ECF No. 222; and (3) a motion to alter or amend the court's order granting Founders's motion for summary judgment in the bad faith action, ECF No. 224. The court will address each motion in this consolidated order in turn.

         I. BACKGROUND

         The facts underlying this dispute have been briefed and discussed by this court ad nauseam. In sum, the parties filed five separate motions for summary judgment and created a record well over 1, 000 pages. Kehagias briefed the underlying issues numerous times, submitting nineteen exhibits with its motion for summary judgment and seventeen exhibits with its opposition to Founders's motion for summary judgment. The court heard oral arguments on the motions during the course of over two hours on December 14, 2015. Thereafter, the court issued five separate orders, totaling almost 100 pages. Needless to say, the parties and the court have thoughtfully considered these issues.

         II. STANDARD

         The Fourth Circuit has recognized three grounds for amending an earlier judgment under Federal Rule of Civil Procedure 59(e): (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 prevent manifest injustice. Pac. Ins. Co. v. Am. Nat. Fire Ins. Co., 148 F.3d 396, 403 (4th Cir. 1998). A Rule 59(e) motion “may not be used to relitigate old matters, or to raise arguments or present evidence that could have been raised prior to the entry of judgment.” Exxon Shipping Co. v. Baker, 554 U.S. 471, 486 n.5 (2008) (internal quotation marks omitted). Further, “mere disagreement [with a district court's ruling] does not support a Rule 59(e) motion.” Hutchinson v. Staton, 994 F.2d 1076, 1082 (4th Cir. 1993). “In general reconsideration of a judgment after its entry is an extraordinary remedy which should be used sparingly.” Pac. Ins. Co., 148 F.3d at 403 (citation and internal quotation marks omitted). A motion for reconsideration “is not a license for a losing party's attorney to get a second bite at the apple.” Bey v. Shapiro Brown & Alt, LLP, 997 F.Supp.2d 310, 321 (D. Md. 2014) (citing Shields v. Shetler, 120 F.R.D. 123, 125-26 (D. Colo. 1988)).

         III. DISCUSSION

         In all three motions to alter or amend, Kehagias argues that the court must reconsider its prior orders to correct a clear error of law or prevent manifest injustice. However, Kehagias's motions each attempt to relitigate the issues.

         A. Motion to Alter or Amend the Court's Ruling in ECF No. 221

         On June 8, 2016, the court entered an order granting Founders's motion for summary judgment, ECF No. 159, and denying Kehagias's motion for partial summary judgment, ECF No. 155. In doing so, the court held that, under the unambiguous notice provisions of the general liability and liquor liability policies issued by Founders to Richard Ruth's Bar & Grill, LLC, Richard Ruth, Sr. (“Mr. Ruth”), and Jane Ruth (“Ms. Ruth”) (collectively “the Ruths”), the Ruths failed to provide proper notice of Kehagias's underlying personal injury lawsuit. The court further held that the Ruths' failure to provide notice as required under the policy caused Founders substantial prejudice. Therefore, the court held that the Ruths' conduct obviated Founders's contractual duty to provide coverage.

         In his motion, Kehagias makes the following arguments: (1) Founders waived the notice requirements in the Policy; (2) Cherie Dumez (“Dumez”) is Founders's agent for purposes of notice; (3) Founders failed to establish prejudice as a matter of law; and (4) the court's order creates a manifest injustice by holding that Founders suffered substantial prejudice because the court failed to consider evidence. First and foremost, Kehagias's motion is a thinly disguised attempt to relitigate the issues previously and extensively briefed, argued, and addressed and decided by the court. Kehagias does not provide new evidence or controlling law but simply argues that the court got it wrong. Nevertheless, the court will address Kehagias's arguments.

         1. Waiver

         Kehagias first argues that Founders waived the notice provisions of the Policy because Ms. Ruth forwarded previous claims to Ms. Dumez, who would thereafter forward the claim to Hull, who would, in turn, forward the claim to Founders. Kehagias contends that he set forth his waiver and estoppel arguments in his response to Founders's motion, ECF No. 179, and during the December 14, 2015 hearing. Notably, the words “waiver” and “estoppel” cannot be found in Kehagias's response. ECF No. 179. Similarly, the words “waiver” and “estoppel” were never uttered by Kehagias's counsel during the December 14, 2015 hearing. Although Kehagias did outline the “course of conduct” among the parties in handling prior claims, Kehagias did not argue that Founders waived the notice provisions of the Policy nor did he present any case law to support such an argument. Rather, the course of conduct argument was presented to the court regarding the assumption of a duty under the Second Restatement of Torts. See ECF No. 222 at 6-8.

         The court cannot be expected to read Kehagias's mind by anticipating and addressing all conceivable arguments potentially implicated in a record well over 1, 000 pages but not presented to the court. Kehagias's waiver and estoppel arguments ignore the “well-established principle that arguments raised for the first time in a motion for reconsideration are generally deemed waived.” United States v. Foreman, 369 F.3d 776, 797 (4th Cir. 2004); see, e.g., Holland v. Big River Minerals Corp., 181 F.3d 597, 605 (4th Cir. 1999) (stating that an issue first presented in a motion pursuant to Fed.R.Civ.P. 59(e) “is not preserved for appellate review unless the district court exercises its discretion to excuse the party's lack of timeliness and consider[s] the issue”); Mungo v. Taylor, 355 F.3d 969, 978 (7th Cir. 2004) (“Arguments raised for the first time in connection with a motion for reconsideration, however, are generally deemed to be waived.”) (citation omitted); DiMarco-Zappa v. Cabanillas, 238 F.3d 25, 33 (1st Cir. 2001) (“To the extent that appellants' reconsideration motion sought to raise an argument waived at the trial stage, it must necessarily fail.”); Pittston Co. Ultramar Am. Ltd. v. Allianz Ins. Co., 124 F.3d 508 n.12 (3d Cir. 1997) (declining to consider on appeal issue raised for the first time in a post-judgment motion); CMM Cable Rep, Inc. v. Ocean Coast Props., Inc., 97 F.3d 1504, 1526 (1st Cir. 1996) (stating that “there is absolutely no merit” to the argument “that we should find [a party's] arguments preserved because they were advanced in its motion for reconsideration”); Manor Healthcare Corp. v. Guzzo, 894 F.2d 919, 922 n.4 (7th Cir. 1990) (“Raising an issue in a motion for reconsideration does not save the issue for appeal.”) (citations omitted); Am. Meat Inst. v. Pridgeon, 724 F.2d 45, 47 (6th Cir. 1984) (holding issue raised for first time in motion for reconsideration constituted waiver). As the Seventh Circuit has recognized, “[m]otions for reconsideration serve a limited function: to correct manifest errors of law or fact or ...


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