IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA
March 28, 2011
LAURIE WOLF; DOLORES BERMAN; BRADY HEATH; TERESA HEATH; STEVEN A. NEWELL; MARILYN CADREAU NEWELL; TAMSCO PROPERTIES, LLC; JKR LASER INVESTMENT, LLC; SURFER BEACH, LLC; AND ,DETERMINED LLC, PLAINTIFFS,
LORAL LANGEMEIER AND LIVE OUT LOUD, INC., DEFENDANTS.
The opinion of the court was delivered by: Garland E. Burrell, Jr. United States District Judge
ORDER DENYING PLAINTIFFS' MOTION TO REVISE *fn1
ORDER TO BE DETERMINED STAYING LITIGATION PENDING ARBITRATION AND DENYING MOTIONS FOR SANCTIONS*fn2
Plaintiffs move under Federal Rule of Civil Procedure ("Rule") 54(b) and the Court's inherent authority for an order that would revise the Order filed August 24, 2010 ("August 24 Order"). The August 24 Order granted Defendants' motion in which they sought to stay this action pending arbitration. Plaintiffs argue revision of the August 24 Order is required since "defendants committed fraud on the court" when obtaining the August 24 Order. (Notice of Mot. 2:6-13.) Defendants counter that "Plaintiffs' entire motion is based on assumptions." (Opp'n 1:2.)
Also pending is Defendants' sanctions motion against Plaintiffs' counsel, argued under Rule 11(b). Defendants contend their Rule 11(b) motion should be granted since "plaintiffs were aware there was no legal or factual basis for their motion for reconsideration, yet still filed said motion." (Notice of Mot. for Sanctions 1:7-10.) Plaintiffs replied with a sanctions motion against Defendants. (Reply to Opp'n 10:8-11:2.)
Rule 54(b) "states that a district court can modify an interlocutory order 'at any time' before entry of a final judgment, and [the Ninth Circuit has] long recognized 'the well-established rule that a district judge always has power to modify or to overturn an interlocutory order or decision while it remains interlocutory.'" Credit Suisse First Boston Corp. v. Grunwald, 400 F.3d 1119, 1124 (9th Cir. 2005). "To succeed in a motion to reconsider, a party must set forth facts or law of a strongly convincing nature to induce the court to reverse its prior decision." Hansen v. Schubert, 459 F. Supp. 2d 973, 998 (E.D. Cal. 2006).
Plaintiffs argue the August 24 Order should be revised because Defendants "obtained [it] through a fraud upon the Court." (Mot. 1:5-6.) Plaintiffs contend "Defendants committed fraud on the court by misrepresenting (1) the existence of [Big Table] agreements signed by CRI for Laurie Wolf, Steven Newell, and Marilyn Newell, (2) the date or period of time when CRI signed Dee Berman's Big Table agreement, (3) the date or period of time when LOL created and/or signed LOL's resolution assuming CRI's liabilities." Id. 9:25-28. Plaintiffs contend "these misrepresentations result from defendant's [sic] production of documents attached to the Reply that were crucial to the court's holding[.]" Id. 9:28-10:2. Plaintiffs "request that defendants [be] ordered to produce the original LOL corporate resolution as well as any copy used . . . as an exhibit." Id. 2:22-25. Plaintiffs "also request the defendants produce for inspection and testing the original, and any copy used as an exhibit, of the [Big Table] contract for Delores Berman[.]" Id. 3:6-8.
Defendants counter that Plaintiffs rely on "'suspicion' and speculation as a basis to accuse defendants of committing a 'fraud' upon the Court[,]" and argue that speculation concerning what "evidence might be discovered in the future" does not justify reconsideration of the August 24 Order. (Opp'n 4:6-8, 8:4-6). Defendants also argue "a motion for reconsideration cannot be used to rehash arguments that were already presented to the Court" and "Plaintiffs did present their 'suspicions' to the Court in connection with the prior motion, as part of their supplemental brief." Id. 9:6-7; 5:12-13.
"Motions to reconsider are . . . not vehicles permitting the unsuccessful party to rehash arguments previously presented." Cachil Dehe Band of Wintun Indians of Colusa Indian Community v. California, 649 F. Supp. 2d 1063, 1069 (E.D. Cal. 2009) (internal quotation marks omitted). Plaintiffs previously argued in a supplemental brief they filed before the August 24 Order issued that they "should be allowed to examine the original agreements and ask discovery questions about their formation[.]" (ECF No. 35, 7:16-22.) These objections were overruled because Plaintiffs failed to show why the evidence should not be considered. (ECF No. 37, 7:4-6.) Plaintiffs' current arguments reiterate and expand on those previously overruled arguments. However, Plaintiffs have not set forth "facts . . . of a strongly convincing nature to induce the court to reverse its prior decision." Hansen, 459 F. Supp. 2d at 998. All Plaintiffs have offered are suspicions. Therefore, Plaintiffs' motion to revise the August 24 Order is denied.
Further, Defendants are not entitled to Rule 11 sanctions since they failed to satisfy the procedures applicable to sanctions under the rule, and Plaintiffs' Rule 11 sanctions motion is denied because sufficient reason has not been provided justifying a sanction.
For the stated reasons each motion is DENIED.