Opinion
Civil Action No. 99-2332
April 9, 2001
ORDER AND REASONS
Before the Court is plaintiffs' Motion for Reconsideration of Plaintiffs' Motion for Leave to File Fourth Supplemental and Amending Complaint and for Reconsideration in Granting Kalmus' Motion to Dismiss Count Two of the Plaintiffs' Third Supplemental and Amending Complaint. For the following reasons, the plaintiffs' motion is DENIED.
BACKGROUND
On May 12, 1999, plaintiffs Dhanpot Mohnot, Surendra Purohit, and Sunil Purohit filed their original complaint in state court, naming Rajeev Bhansali as the sole defendant and alleging that he committed fraud and RICO violations in his capacities as director of International Technologies (India), Limited ("ITIL") and International Circuits, Limited ("ICL"), two corporations in which the plaintiffs invested approximately $450,000.00. In October 1999, the plaintiffs filed a Supplemental and Amending Complaint to include Dr. Christopher E. Kalmus as a defendant. In June 2000, defendants Kalmus and Bhansali filed a motion to dismiss the plaintiffs' complaint. In response to the defendants' motion to dismiss but before the Court conducted a hearing on the motion, the plaintiffs filed a Second Supplemental and Amending Complaint in an attempt to correct the alleged deficiencies pointed out by the defendants. On June 23, 2000, the Court dismissed plaintiffs' RICO claims with prejudice, dismissed their fraud claims without prejudice, and granted plaintiffs leave to amend their complaint to plead fraud with particularity. On September 29, 2000, the day before the Court-ordered deadline for filing amended complaints, the plaintiffs filed a Third Supplemental and Amending Complaint.
On February 23, 2001, the Court entered an Order and Reasons which (1) denied the plaintiffs leave to file a Fourth Supplemental and Amending Complaint, (2) dismissed Count Two of the plaintiffs' Third Supplemental and Amending Complaint, and (3) granted the plaintiffs leave to amend their Third Supplemental and Amending Complaint to correct a factual error. The plaintiffs now ask the Court reconsider its decision.
LAW AND ANALYSIS
Because Count Two of the Third Supplemental and Amending Complaint was dismissed as the result of a dispositive motion, the Court shall treat the instant motion as a Rule 59(e) motion to alter or amend judgment. See Ford Motor Credit Co. v. Bright, 34 F.3d 322, 324 (5th Cir. 1994) (holding that Rule 59(e) allows a losing party to "seek the trial court's reconsideration of its order granting summary judgment if served within 10 days of the rendition of judgment"). A district court enjoys considerable discretion in granting or denying a motion for reconsideration under Rule 59(e). See Edward H. Bohlin Co. v. Banning Co., 6 F.3d 350, 355 (5th Cir. 1993). Courts typically consider four factors in exercising their discretion: (1) whether the judgment was based upon a manifest error of fact or law; (2) whether the movant presents newly discovered or previously unavailable evidence; (3) whether amendment is necessary to prevent manifest injustice; and (4) whether an intervening change in controlling law has occurred. See Franco v. Maraldo, 2000 WL 288378, at *2 (E.D.La. March 16, 2000); Campbell v. St. Tammany Parish Sch. Bd., 1999 WL 777720, at *2 (E.D.La. Sept.29, 1999);Fields v. Pool Offshore. Inc., 1998 WL43217, at *2 (E.D.La. Feb. 3, 1998).
In the instant case, the plaintiffs claim that reconsidering the Court's previous motion will prevent manifest injustice. Specifically, the plaintiffs ask (1) that they be allowed to file a Fourth Supplemental and Amending Complaint and (2) that Count Two of their Third Supplemental and Amending Complaint be reinstated against defendant Dr. Christopher Kalmus.
1. Fourth Supplemental and Amending Complaint
In their previous motion, the plaintiffs requested leave of Court to correct an inadvertent factual error in Count Two of their Third Supplemental and Amending Complaint. This request was granted; the Court allowed the plaintiffs to amend their Third Supplemental Complaint and withdraw the incorrect factual allegation that defendant Kalmus was present at a meeting on April 10, 1996. See Rec. Doc. No. 82 at 6. However, the Court denied the plaintiffs' attempt to file a Fourth Supplemental and Amending complaint which added three new factual allegations concerning Kalmus' involvement in the allegedly fraudulent sale of land owned by ITIL.
In the instant motion, the plaintiffs argue that the Court's denial was in error because a district court should deny motions to amend only in limited circumstances. The Fifth Circuit has instructed that "[t]he types of reasons that might justify denial of permission to amend a pleading include undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, and undue prejudice to the opposing party." Dussouy v. Gulf Coast Inv. Corp., 660 F.2d 594, 598 (5th Cir. 1981). As the Court explained in its previous order, the plaintiffs have already filed an initial complaint and three amending complaints. In its June 23, 2000 Order and Reasons, the Court granted the plaintiffs leave to file a third amending complaint and explicitly instructed them to set forth, with specificity, each and every claim of fraud alleged against the defendants.
The plaintiffs now argue that, until now, they could not have included every claim against Kalmus because "there has been no evidence that Plaintiffs knew about specific dates regarding Kalmus' involvement in the land sale since filing their original complaint." Plaintiffs' Mem. at 5. However, during the three month delay between the Court's entry of its June 23, 2000 Order and Reasons and the plaintiffs' filing of their Third Supplemental and Amending Complaint on September 29, 2000, the plaintiffs had the minutes of the ITIL board meetings within their sole possession. It is information contained within these minutes that the plaintiffs now seek to add.
Because the plaintiffs have presented no reasonable justification why their new allegations could not have been included in any of their four previous complaints, the plaintiffs' request for leave to file a Fourth Supplemental and Amending Complaint is DENIED.
2. Count Two
Even if leave to amend is denied, the plaintiffs argue that the Court erred in dismissing Count Two against defendant Kalmus because they have successfully alleged that Kalmus committed fraud by silence. Specifically, plaintiffs argue that defendant Bhansali made a material misrepresentation at a meeting on April 10, 1996 and that "[i]t was through Kalmus' silence at this meeting that he continued to commit acts of fraud in connection with the land sale against the Plaintiffs." Plaintiffs' Mem. at 7. However, because the plaintiffs have admitted that Kalmus was not present at the April 10 meeting, the Court does not find that they have stated a cause of action for fraud by silence.
CONCLUSION
Because the plaintiffs have presented no grounds for reversal of the Court's Order and Reasons entered on February 23, 2001, their Motion for Reconsideration is DENIED.