Pittston Co. v. Sedgwick James of New York, Inc.

• Decision Date: 22 July 1997
• Docket Number: Civil Action No. 96-1578.
• Citation: 971 F.Supp. 915
• Parties: The PITTSTON COMPANY, Plaintiff, v. SEDGWICK JAMES OF NEW YORK, INC., Defendant.
• Court: U.S. District Court — District of New Jersey

Page 915

971 F.Supp. 915

The PITTSTON COMPANY, Plaintiff, v. SEDGWICK JAMES OF NEW YORK, INC., Defendant.

Civil Action No. 96-1578.

United States District Court, D. New Jersey.

July 22, 1997.

Dennis J. Drasco, Kevin J. O'Connor, Lum, Danzis, Drasco, Positan & Kleinberg, Roseland, NJ, for Plaintiff.

Stuart J. Freedman, Charles W. Miller, III, Norris, Mclaughlin & Marcus, Somerville, NJ, James S. Dittmar, James L. Messenger, Hutchins, Wheeler & Dittmar, Boston, MA, for Defendant.

OPINION

WOLIN, District Judge.

Plaintiff The Pittston Company ("Pittston") has moved for reconsideration of this Court's October 18, 1996 Opinion and Order granting summary judgment in favor of defendant Sedgwick James of New York, Inc. ("Sedgwick"). See The Pittston Co. v. Sedgwick James of New York, Inc., No. 96-1578, 1996 WL 617139 (D.N.J.1996) (the "Summary Judgment Opinion"). The Court has decided this motion without oral argument. For the reasons expressed below, the Court will (1) grant Pittston's Motion for Reconsideration; (2) vacate Parts 2C and 2D of the Discussion section of the Summary Judgment Opinion; (3) vacate summary judgment in favor of Sedgwick on entire controversy grounds; and (4) affirm summary judgment in favor of Sedgwick on statute of limitations grounds, an issue initially raised in Sedgwick's Motion for Summary Judgment which the Court never reached in the Summary Judgment Opinion.

BACKGROUND

On April 3, 1996, Pittston instituted this action against Sedgwick by filing a complaint in this Court. The crux of the complaint is that Sedgwick, an insurance broker negligently failed to obtain proper environmental liability insurance on behalf of Pittston. On August 1, 1996, Sedgwick filed a Motion for Summary Judgment seeking to dismiss Pittston's complaint on the grounds that (1) the complaint is barred by New Jersey's entire controversy doctrine;¹ and (2) Pittston's claims are time barred.

On October 18, 1996, this Court entered an Opinion and Order granting summary judgment in favor of Sedgwick based upon the entire controversy doctrine. See generally Summary Judgment Opinion. Specifically, the Court held that the entire controversy doctrine could be applied to bar a second filed action even where final judgment has not been entered in the first filed action. See id. *9. Because the Court granted summary judgment based on the entire controversy doctrine, the Court did not address the issue of whether Pittston's claims were barred by the applicable statute of limitations. See id. *11 n. 12.

On November 1, 1996, Pittston filed the present Motion for Reconsideration of the Court's summary judgment Order. In its motion, Pittston argues that (1) the Court misapplied the entire controversy doctrine and (2) this Court, sitting in diversity, should not apply a state law procedural doctrine. Naturally, Sedgwick opposes Pittston's motion for reconsideration and filed written submissions to that effect on November 12, 1996.

While Pittston's motion for reconsideration was pending, the United States Court of Appeals for the Third Circuit released Rycoline Products, Inc. v. C & W Unlimited, 109 F.3d 883 (3d Cir.1997), an opinion that addressed, the issue of final judgment under the entire controversy doctrine. The plaintiff in Rycoline had initiated an action in state court and, subsequently, while the state court action was still pending, brought a second action against the same defendants in federal court. The district court dismissed the federal action on entire controversy doctrine grounds. In so doing, the district court relied heavily on the discussions of the entire controversy doctrine in Kelly v. Borough of Sayreville, 927 F.Supp. 797 (D.N.J.1996), aff'd, 107 F.3d 1073 (3d Cir.1997)² and Mortgagelinq Corp. v. Commonwealth Land Title Insurance Co., 142 N.J. 336, 662 A.2d 536 (1995).

On appeal, the Third Circuit reversed the district court decision. In reversing Rycoline, the Third Circuit examined whether the entire controversy doctrine could be applied to bar a second action filed while the first action was still pending. After a thorough discussion of the issue, the Third Circuit held that "the entire controversy doctrine does not preclude the initiation of a second action before the first action has been concluded." Rycoline, 109 F.3d at 890. In reaching that holding, the Third Circuit disregarded Kelly and found Mortgagelinq not to be dispositive of the issue. See id. at 888-89. Instead, the Third Circuit relied on Kaselaan & D'Angelo Associates, Inc. v. Soffian, 290 N.J.Super. 293, 675 A.2d 705 (App.Div.1996), the only New Jersey case that the Third Circuit found to "squarely address[] and answer[]" the question of whether the entire controversy doctrine can be applied before the first action is concluded. See Rycoline, 109 F.3d at 887 (quoting the holding in Kaselaan, 290 N.J.Super. at 299, 675 A.2d at 708: "[The entire controversy doctrine] does not require dismissal when multiple actions involving the same or related claims are pending simultaneously.").

Notably, at the end of its discussion, the Third stated:

In so holding, we necessarily express our disapproval of Pittston Co. v. Sedgwick James of New York ..., the only other opinion we have uncovered that addresses the issue we decide today. There, the court held that "the absence of final judgment in the [first] filed action does not preclude application of the entire controversy doctrine" to bar the second action. Although Pittston was decided five months after Kaselaan, it fails to cite that opinion. Moreover, the district court in Pittston relied upon the same inferences from Mortgagelinq that we have found to be unsound. Thus, Pittston suffers from the same infirmities as the opinion of the district court in the instant case and should not be followed.

Id. at 889-90.

After the Third Circuit released its decision in Rycoline, Pittston wrote to this Court and requested that its motion for reconsideration be granted immediately. Sedgwick, in turn, requested the opportunity to supplement its opposition to Pittston's Motion for Reconsideration so as to argue why Rycoline does not mandate granting Pittston's motion. The Court granted Sedgwick's request, and both parties thereafter submitted briefs addressing the issues presented by Rycoline and the impact of that opinion on the present Motion for Reconsideration.

DISCUSSION

I. Standard for Reconsideration

Local Civil Rule 7.1(g) of the United States District Court, District of New Jersey, contains the standard to be applied to motions for reconsideration;³ Rule 7.1(g) requires that the moving party "set forth concisely the matters or controlling decisions which counsel believes the [Court] has overlooked." The Rule "does not contemplate a Court looking to matters which were not originally presented." Florham Park Chevron, Inc. v. Chevron U.S.A., Inc., 680 F.Supp. 159, 162 (D.N.J.1988). Thus, a party "must show more than a disagreement with the court's decision." Panna v. Firstrust Sav. Bank, 760 F.Supp. 432, 435 (D.N.J.1991). A mere "recapitulation of the cases and arguments considered by the court before rendering its original decision fails to carry the moving party's burden." Carteret Sav. Bank. F.A. v. Shushan, 721 F.Supp. 705, 709 (D.N.J.1989).

In its initial brief in support of the Motion for Reconsideration, Pittston argues two reasons why the Summary Judgment Opinion should be reconsidered and vacated: (1) the Court misapplied and inappropriately expanded the entire controversy doctrine by holding that the doctrine is applicable in cases where final judgment has not been entered in the first filed action; and (2) the Court, sitting in diversity, should not apply a state law procedural doctrine. See generally Pl.'s Br. in Support of Motion for Reconsideration ("Pl.'s Reconsideration Br.").

The Court need not address the latter argument because Pittston did not raise it in opposition to Sedgwick's Motion for Summary Judgment. Indeed, Pittston candidly acknowledges that, with respect to its second argument, Pittston fails to produce an issue that the Court "overlooked" in deciding the Motion for Summary Judgment: "Although this issue was not specifically briefed by Pittston in its opposition to the Motion for Summary Judgment, it is respectfully submitted that same is an important issue which addresses an inherent limitation on this Court's authority in a diversity action. As such this issue should be addressed on reconsideration." Id. at 9 n. 1. Despite Pittston's invitation, the Court declines to consider Pittston's second issue — whether the Court, sitting in diversity, should apply a state law procedural doctrine. As this Court stated in Florham Park, Rule 7.1(g) "does not contemplate a Court looking to matters which were not originally presented but which have since been provided for consideration." 680 F.Supp. at 162. The Court therefore concludes that Pittston's second argument does not support reconsideration of the Summary Judgment Opinion.

As to Pittston's first argument, however, the Rycoline decision warrants granting Pittston's Motion for Reconsideration. Where, during the pendency of a motion for reconsideration, the Third Circuit Court of Appeals, or other court of binding authority, issues a decision that reasonably can be said to control the issue underlying the motion for reconsideration, a district court has a responsibility to review its own opinion in light of the Third Circuit decision; this review not only advances the policy of judicial economy, but is mandated by our judicial hierarchy. Upon reconsideration, the Court may determine the extent to which the newly-issued decision controls the issue and whether the court's prior ruling should be affirmed, vacated or modified.

Here, Rycoline can reasonably be said to control the issue imbedded in Pittston's Motion for Reconsideration — whether the entire controversy doctrine may be applied prior to the...