Exec. Ambulatory Surgical Ctr., LLC v. State Farm Mut. Auto. Ins. Co.

• Decision Date: 02 October 2020
• Docket Number: Case No. 18-cv-14094
• Citation: 492 F.Supp.3d 728
• Parties: EXECUTIVE AMBULATORY SURGICAL CENTER, LLC, as assignee of Tamika Burrell, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant.
• Court: U.S. District Court — Eastern District of Michigan

492 F.Supp.3d 728

EXECUTIVE AMBULATORY SURGICAL CENTER, LLC, as assignee of Tamika Burrell, Plaintiff,

v.STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant.

Case No. 18-cv-14094

United States District Court, E.D. Michigan, Southern Division.

Signed October 2, 2020

Gary R. Blumberg, Dearborn, MI, for Plaintiff.

Paul D. Hudson, Miller, Canfield, Paddock & Stone, P.L.C., Kalamazoo, MI, Kevin J. Bacon, Kent E. Gorsuch & Associates, Southfield, MI, for Defendant.

OPINION AND ORDER DENYING DEFENDANT'S MOTION FOR RECONSIDERATION (ECF NO. 25) AND DENYING DEFENDANT'S MOTION FOR JUDICIAL NOTICE (ECF NO. 27)

Paul D. Borman, United States District Judge

I. INTRODUCTION

On March 3, 2020 the Court issued an Opinion and Order denying Defendant's Motion for Summary Judgment (ECF No. 9). Executive Ambulatory Surgical Ctr., LLC v. State Farm Mut. Auto. Ins. Co. , 442 F. Supp. 3d 998 (E.D. Mich. 2020) (ECF No. 22.) In the Opinion and Order, the Court held that Plaintiff Executive Ambulatory Surgical Center, LLC's ("Executive Ambulatory's") claims against Defendant State Farm Mutual Automobile Insurance Company ("State Farm"), seeking no-fault insurance benefits, were not barred under the doctrines of res judicata and collateral estoppel. ( Id. )

On March 17, 2020, Defendant State Farm filed a Motion for Reconsideration of the Court's denial of its motion for summary judgment. (ECF No. 25, Defendant's Motion for Reconsideration.) State Farm argues that the Court palpably erred in determining that Executive Ambulatory's claims were not barred by res judicata or collateral estoppel, and that the Court collaterally attacked and refused to honor the jury verdict and judgment entered by the 46th District Court and order for summary disposition and judgment entered by the Wayne County Circuit Court. (ECF No. 25.) Defendant also filed a Motion for Judicial Notice (ECF No. 27), asking the Court to take judicial notice of two of its prior opinions. After reviewing Defendant's motions, the Court finds that none of the arguments clears the high bar for granting reconsideration, and therefore denies the Defendant's Motion for Reconsideration and denies Defendant's Motion for Judicial Notice.

II. STANDARD OF REVIEW

"A motion for reconsideration is governed by the local rules in the Eastern District of Michigan, which provide that the movant must show both that there is a palpable defect in the opinion and that correcting the defect will result in a different disposition of the case." Indah v. U.S. S.E.C. , 661 F.3d 914, 924 (6th Cir. 2011). Eastern District of Michigan Local Rule 7.1(h)(3) provides:

Generally, and without restricting the court's discretion, the court will not grant motions for rehearing or reconsideration that merely present the same issues ruled upon by the court, either expressly or by reasonable implication. The movant must not only demonstrate a palpable defect by which the court and the parties and other persons entitled to be heard on the motion have been misled but also show that correcting the defect will result in a different disposition of the case.

E.D. Mich. L.R. 7.1(h)(3). "A ‘palpable defect’ is a defect which is obvious, clear, unmistakable, manifest, or plain." Michigan Dep't of Envtl. Quality v. City of Flint , 296 F. Supp. 3d 842, 847 (E.D. Mich. 2017).

"A motion for reconsideration which presents the same issues already ruled upon by the court, either expressly or by reasonable implication, will not be granted." Ford Motor Co. v. Greatdomains.Com, Inc. , 177 F. Supp. 2d 628, 632 (E.D. Mich. 2001). "A motion for reconsideration should not be used liberally to get a second bite at the apple, but should be used sparingly to correct actual defects in the court's opinion." Oswald v. BAE Industries, Inc. , No. 10-cv-12660, 2010 WL 5464271, at *1 (E.D. Mich. Dec. 30, 2010). It should not be "used as a vehicle to re-hash old arguments or to advance positions that could have been argued earlier but were not." Smith v. Mount Pleasant Pub. Sch. , 298 F. Supp. 2d 636, 637 (E.D. Mich. 2003). It follows, then, that "parties cannot use a motion for reconsideration to raise new legal arguments that could have been raised before a judgment was issued," Roger Miller Music, Inc. v. Sony/ATV Publ'g, 477 F.3d 383, 395 (6th Cir. 2007), and parties "may not introduce evidence for the first time in a motion for reconsideration where that evidence could have been presented earlier." Bank of Ann Arbor v. Everest Nat. Ins. Co. , 563 F. App'x 473, 476 (6th Cir. 2014).

III. ANALYSIS

Defendant presents three main arguments in its motion for reconsideration: (1) the dismissal of Tamika Burrell's Circuit Court case operates as an adjudication on the merits for purposes of res judicata, and because Burrell is ineligible for benefits, Executive Ambulatory's derivative claims are barred by res judicata; (2) Executive Ambulatory's claims are barred by collateral estoppel because Executive Ambulatory "stands in the shoes" of Burrell and the same parties, or their privies, had a full and fair opportunity to litigate the "eligibility" issue in the prior action; and (3) it was palpable error for the Court to collaterally attack the state court judgment and grant of summary disposition. (ECF No. 25.) The first two arguments were addressed by the parties, considered by the Court, and ruled upon in the Court's March 3, 2020 Opinion and Order, and the third argument is unpersuasive, and accordingly Defendant's motion fails to identify a "palpable defect" by which the Court and the parties have been misled.

A. Defendant Has Failed to Establish a Palpable Error Regarding the Court's Res Judicata Finding

The background facts related to Defendant's motion are set forth in detail in this Court's March 3, 2020 Opinion and Order. Briefly, Plaintiff Executive Ambulatory seeks to collect payment of no-fault personal injury protection ("PIP") insurance benefits for treatment it provided to Tamika Burrell, stemming from an August 19, 2014 motor vehicle accident. Defendant State Farm, Burrell's insurer, filed a motion for summary judgment arguing that Plaintiff's claims are barred by res judicata and/or collateral estoppel, based on a jury verdict in a state district court lawsuit brought by another medical provider, ATI, ("the ATI litigation") and a summary disposition order in a state circuit court lawsuit brought by Tamika Burrell ("the Burrell litigation").

As the Court explained in its Opinion and Order, in Michigan, the doctrine of res judicata, or claim preclusion, "bars a second, subsequent action when (1) the prior action was decided on the merits, (2) both actions involve the same parties or their privies, and (3) and matter in the second case was, or could have been, resolved in the first [case]." Executive Ambulatory , 442 F. Supp. 3d at 1004 (citing Adair v. Michigan , 470 Mich. 105, 121, 680 N.W.2d 386 (2004) ). The Court thoroughly examined and discussed each res judicata prong under the facts of this case and found that: (1) the prior actions between ATI and State Farm and between Burrell and State Farm were decided on the merits; however, (2) the two state court actions and this case did not involve "the same parties or their privies" and Executive Ambulatory did not have a "full and fair opportunity" to litigate its claims in those prior state court actions; and (3) this suit could not have been resolved in either the ATI or the Burrell litigation, because the benefits Plaintiff seeks had yet to accrue at the time those actions were brought. Executive Ambulatory , 442 F. Supp.3d at 1004-09.¹

In its Motion for Reconsideration, Defendant State Farm primarily reasserts the same arguments it made in its motion for summary judgment, which the Court thoroughly considered and addressed. Defendant argues, as it did in its motion for summary judgment, that Plaintiff's claims are derivative of Burrell's and if Burrell's claim is barred, any derivative claim will fail as well. (ECF No. 25 at pp. 4, 7-11, PgID 612, 615-19; ECF No. 9, Def.’s Mot. S.J. at pp. 15-16, PgID 102-03.) "A motion for reconsideration which presents the same issues already ruled upon by the court, either expressly or by reasonable implication, will not be granted." See Ford Motor Co. , 177 F. Supp. 2d at 632. Defendant surprisingly contends that "it was palpable error for the Court to focus its inquiry on whether this Plaintiff's claims could have been or even should have been adjudicated in the prior suits." (ECF No. 25 at p. 11, PgID 619.) However, whether "the matter in the second case was, or could have been, resolved in the first case," is the third prong of the res judicata analysis under Michigan law, see Adair , 470 Mich. at 121, 680 N.W.2d 386, and thus it patently was not palpable error for the Court to consider and analyze this factor in its res judicata analysis. Accordingly, Defendant has failed to demonstrate a palpable error by which the Court and the parties have been misled with regard to the Court's res judicata finding, and Plaintiff's Motion for Reconsideration on this basis is DENIED.

B. Defendant Has Failed to Establish a Palpable Error Regarding the Court's Collateral Estoppel Finding

Under Michigan law, the three elements of collateral estoppel are: (1) a question of fact essential to the judgment was actually litigated and determined by a valid and final judgment; (2) the same parties or their privies had a full and fair opportunity to litigate the issues; and (3) there was mutuality of estoppel. Radwan v. Ameriprise Ins. Co. , 327 Mich. App. 159, 166, 933 N.W.2d 385 (2018) ; see also Estes v. Titus , 481 Mich. 573, 585, 751 N.W.2d 493 (2008). In its Opinion and Order, the Court thoroughly considered and discussed each collateral estoppel prong, and found: (1) there appears to be a question of fact essential to the judgment that was litigated and determined in a valid and final judgment; but (2) the same parties or their privies did not have a full and fair...