United States District Court, D. South Carolina, Charleston Division
J. William Smoak, III, and Smoak's Air Conditioning Co., Inc., Plaintiffs,
Elizabeth Cangialosi, ADP Totalsource, Inc., Automatic Data Processing, Inc., Automatic Data Processing Insurance Agency, Inc., and Aetna Life Insurance Company, Defendants.
ORDER AND OPINION
RICHARD MARK CERGEL UNITED STATES DISTRICT COURT JUDGE .
matter is before the Court on Defendants Elizabeth
Cangialosi, ADP Total Source, Inc., Automatic Data
Processing, Inc., and Automatic Data Processing Insurance
Agency's (collectively, the "ADP Defendants")
motion for reconsideration of the Court's order of
October 6, 2017 denying the ADP Defendants' motion to
dismiss. For the reasons set forth below, the Court denies
allege Defendants failed to pay death benefits for decedent
Helen B. Smoak, who was an employee of ADP TotalSource, as
agreed under a group life policy Aetna issued to ADP
TotalSource. In late 2015 or early 2016, Defendant Elizabeth
Cangialosi, an employee of one of the ADP Defendant entities,
made a sales presentation to Plaintiffs regarding
worker's compensation coverage. Plaintiffs agreed to
purchase worker's compensation coverage and health
insurance benefits from ADP entities. Plaintiffs allege that
during the process of converting their existing coverage, Ms.
Cangialosi sold Plaintiffs executive life insurance covering
Mr. Smoak's wife, Helen Smoak. Plaintiffs allege Ms.
Cangialosi represented that Ms. Smoak would qualify for a
$300, 000 death benefit without any reduction due to her age.
Based on that representation, Plaintiff purchased from the
ADP Defendants a life insurance policy issued by Defendant
Aetna covering Ms. Smoak. Ms. Smoak died in October 2016.
Aetna then provided a benefit payment of $60, 000, not $300,
000, stating that Ms. Smoak's coverage was subject to a
reduction due to her age.
October 6, 2017, the Court denied the ADP Defendants'
motion to dismiss. The ADP Defendants have moved for
reconsideration of that order, arguing the Court did not
address its argument that ADP TotalSource is the only ADP
Defendant that is a proper Defendant in this action, because
ADP TotalSource (through a subsidiary) was Ms.
Cangialosi's employer, because there is no dispute that
she acted within the scope of her employment at all relevant
times, and because ADP TotalSource was the plan sponsor.
59(e) of the Federal Rules of Civil Procedure governs motions
to alter or amend a judgment; however, the rule does not
provide a legal standard for such motions. The Fourth Circuit
has articulated "three grounds for amending an earlier
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
prevent manifest injustice." Pac. Ins. Co. v. Am.
Nat'l Fire Ins. Co., 148 F.3d 396, 403 (4th Cir.
1998) (citing EEOCv. Lockheed Martin Corp., 116 F.3d
110, 112 (4th Cir. 1997); Hutchinson v. Staton, 994
F.2d 1076, 1081 (4th Cir. 1993)). "Rule 59(e) motions
may not be used, however, to raise arguments which could have
been raised prior to the issuance of the judgment, nor may
they be used to argue a case under a novel legal theory that
the party had the ability to address in the first
instance." Id. at 403 (internal citations
omitted). Rule 59(e) provides an "extraordinary remedy
that should be used sparingly." Id. (internal
citation omitted). The decision to alter or amend a judgment
is reviewed for an abuse of discretion. Id. at 402.
Court has reviewed the ADP Defendants' memorandum in
support of their motion to dismiss. Therein, there is an
argument contained in a footnote that "even if
Plaintiffs' claim against ADP Defendants is not subject
to dismissal in its entirety, all ADP Defendants except
TotalSource are not proper party defendants in this matter
and should be dismissed." (Dkt. No. 17-1 at 2 n. 1.) The
footnote also contains a stipulation that Ms. Cangialosi was
employed by ADP TotalSource, although the ADP Defendants now
stipulate that Ms. Cangialosi was in fact employed by a
subsidiary of ADP TotalSource. (Compare Id. with
Dkt. No. 25 ¶ 5.) The Court's order of October 6,
2017 did not address that footnote, so the Court addresses it
Court is sympathetic to Defendants' desire to excuse what
they believe to be improper Defendants from this action. The
Court recognizes that the ADP Defendants have superior
knowledge of the relationship between Ms. Cangialosi and the
ADP entities and the Court does not doubt the sincerity of
the ADP Defendants' stipulation that ADP TotalSource is
the proper Defendant. But the ADP Defendants essentially ask
the Court to grant judgment on the pleadings based on a
stipulation Plaintiffs dispute. The Court cannot do that.
Summary judgment is the proper procedure when a "moving
party demonstrates, through 'particular parts of
materials in the record, including depositions, documents,
electronically stored information, affidavits or
declarations, stipulations ... admissions,
interrogatory answers, or other materials, ' that
'there is no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of
law.'" Pasternak & Fidis, P.C. v. Recall
Total Info. Mgmt., Inc., 95 F.Supp.3d 886, 910 (D. Md.
2015) (quoting Fed.R.Civ.P. 56(a), (c)(1)(A)) (emphasis
Defendants' should provide Plaintiffs discovery relevant
to this issue and obtain their consent to the dismissal of
the ADP Defendants other than ADP TotalSource. The Court sees
no reason why that discovery should be "costly and
time-consuming." (See Dkt. No 29.) Presumably,
ADP-one of the largest human resource outsourcing firms in
the world-can easily produce basic employment records
regarding a single employee. If, after providing such
discovery, the ADP Defendants are unable to obtain consent,
they may move for summary judgment on the issue and provide
the Court documents relevant to the issue in accordance with
Rule 56(c)(1) of the Federal Rules of Civil Procedure.
foregoing reasons, the Court DENIES the ADP
Defendants' motion for reconsideration (Dkt. No. 25).