The opinion of the court was delivered by: Glasser, United States District Judge
The plaintiffs move, pursuant to Fed. R. Civ. P. 59, for reconsideration of this court's prior order, entered on August 4, 2006, granting the motion of defendant United States Department of Housing and Urban Development ("HUD")*fn1 to dismiss for lack of subject matter jurisdiction, granting the motion of defendant Martin Silver, Esq. ("Silver"), for summary judgment as to all of the claims remaining against him, and denying the plaintiff Paulette and Joy Vaughn's (collectively, "Vaughns") motion to file a Second Amended Complaint, so as to add claims against proposed defendants Sloan Cooper, Peter Cooper, Bank, Tanen & Bank, and Jeffrey Tanen, Esq. See Vaughn v. Consumer Home Mortgage, No. 01-cv-7937, 2006 WL 2239324 (E.D.N.Y. August 4, 2006) (slip copy) (hereinafter "Vaughn III"). For the reasons stated below, the plaintiffs' motion is granted in part and denied in part. To the extent that the court grants reconsideration of its prior order, it finds that defendant Silver is entitled to summary judgment on grounds other than those initially stated, and enters an order to that effect.
The instant motion follows several previous decisions, familiarity with which is assumed.*fn2 See Vaughn v. Consumer Home Mortgage, Inc., 293 F. Supp. 2d 206 (E.D.N.Y. 2003) (granting in part and denying in part HUD's motion to dismiss the plaintiffs' claims for injunctive relief) (hereinafter "Vaughn I"); Vaughn v. Consumer Home Mortgage Inc., No. 01-cv-7937, 2003 WL 21241669 (E.D.N.Y. March 23, 2003) (hereinafter "Vaughn II"); Vaughn III, supra. Only those facts relevant to the disposition of the pending motions for reconsideration will be restated here.
The Vaughns are joint purchasers of residential property located at 247 Cooper Street in Brooklyn, New York. Banks and Mounsey are the joint purchasers of residential property located at 415 Pennsylvania Avenue in Brooklyn, New York. Plaintiffs purchased their respective properties through Defendant Foreclosure Network of New York ("FNNY"). See Vaughn I, 293 F. Supp. 2d at 208. Plaintiffs initiated suit against FNNY and other defendants affiliated with that company, the attorneys who represented the plaintiffs during closing proceedings,*fn3 alleging that they made false representations with the intent to deceive them into purchasing properties at inflated prices. See id. As a component of the alleged scheme, FNNY steered the plaintiffs toward defendant Consumer Home Mortgage ("CHM"), a lender that the plaintiffs allege it consistently used to further the predatory lending scheme, in part by submitting fraudulent appraisal reports to HUD in order to obtain mortgage insurance available to qualifying low-income applicants under the Fair Housing Act ("FHA") . Id. at 209.*fn4
Peter D. Cooper was the managing member, and Sloan Cooper managed the day-to-day operations, of defendant JAS Property Services LLC ("JAS"). JAS, through Sloane Cooper, invested in at least twenty properties which were marketed and sold by FNNY. Jeffrey Tanen and his law firm represented JAS through the filing of the complaint in this matter. JAS provided the financing for FNNY's purchase of distressed property in return for the payment, in the case of the home purchased by plaintiffs, of eighteen percent interest on the loan extended by JAS. The plaintiffs sought to amend their complaint for a second time so as to add claims against Peter and Sloan Cooper, Banks, Tanen & Bank, and Jeffrey Tanen (collectively, the "Proposed Tanen Defendants") for aiding and abetting the other defendants' fraudulent scheme and for deceptive trade practices
The plaintiffs also brought actions against HUD, asserting that HUD had a duty to prevent housing discrimination against plaintiffs as African-American home buyers, and that HUD's failure to institute policies to protect against manipulation by predatory lenders, including HUD's co-defendants, constitutes an abrogation of that duty. The plaintiffs' complaints allege violations of the National Housing Act, 12 U.S.C. §§1708-1709, as well as claims under the FHA,42 U.S.C. §§ 3601 et seq., specifically § 3608(e), arguing that HUD has failed to meet its affirmative obligation to combat housing discrimination. Plaintiffs allege that HUD violated its obligations under those statutes by failing to: (1) exercise due diligence in the issuance of federally-insured mortgages; and (2) warn prospective purchasers/borrowers of a known and substantial risk to them of the dangers of falling prey to predatory selling and lending schemes.
In Vaughn I, the court held that the Administrative Procedures Act ("APA") permits review of HUD's actions, but that the plaintiffs could not meet the rigorous standards for obtaining a mandatory permanent injunction, which requires a showing of "(1) irreparable harm and (2) either (a) likelihood of success on the merits or (b) sufficiently serious questions on the merits and a balance of hardships tipping decidedly in the movant's favor." Vaughn I, 293 F. Supp. 2d 214.HUD subsequently moved to dismiss, arguing, inter alia, that the plaintiffs lack standing to seek declaratory relief against it because they have failed to allege a sufficiently credible future injury. The court granted HUD's motion to dismiss on that ground in Vaughn III.*fn5 See 2006 WL 2239324, at *8-9. In that opinion, the court also granted Silver's motion for summary judgment as to the Vaughns' remaining claims against him, on the ground that they had failed to establish a prima facie case of actual injury, a common element to their claims of fraud, deceptive trade practices, and professional malpractice. The court granted that motion, finding that the plaintiffs had abandoned their claims of fraud and deceptive trade practices, and had failed to establish actual injury or damages as to the malpractice claim. See id. at 12-14. Finally, the court denied the plaintiffs' request to file a Second Amended Complaint alleging claims against the Proposed Tanen Defendants for aiding and abetting the defendants' fraudulent scheme and for deceptive trade practices, holding that the amendment would be futile because, having failed to establish the element of actual damages arising from the underlying transaction in their case against Silver, the plaintiffs could not hope to succeed on similar claims arising from the same transaction against the Proposed Tanen Defendants. See id. at 14-15.
The plaintiffs now move for reconsideration of each aspect of the court's decision in Vaughn III. They argue that the holding granting HUD's motion to dismiss for lack of standing overlooked controlling Supreme Court and Second Circuit precedent which supports the plaintiffs' position that they have standing to seek declaratory relief on the basis of HUD's alleged failure to adequately discharge its statutory obligations, and that the court overlooked substantial evidence in the record which establishes that the plaintiffs have suffered actual damages as a result of the defendants' allegedly fraudulent scheme, requesting that the court reverse its grant of summary judgment to Silver and its denial of the plaintiffs' request to amend their complaint so as to add claims against the Proposed Tanen Defendants on that basis. HUD, Silver, and the Proposed Tanen Defendants oppose the plaintiffs' motion. HUD argues that the instant motion should be summarily denied because the cases cited by the plaintiffs in support of their argument that the court should reverse its prior order were before the court at the time it issued Vaughn III and were presumably considered by it at that time, and that, in any event, Vaughn III was correctly decided because the cases relied upon by the plaintiffs do not support the conclusion that they have standing to seek prospective relief against HUD. Silver argues that the court should deny the plaintiffs' motion as untimely because it was filed more than ten days after the Vaughn III order was entered, and that the prior order was correct that the evidence in the record fails to establish a prima facie case of actual injury. The Proposed Tanen Defendants join Silver in arguing that the instant motion is untimely, and further argue that the plaintiffs cannot establish actual damages because the substantial settlement they have already received from other defendants makes up for any pecuniary loss they may have suffered due to the allegedly fraudulent scheme.
Federal Rule of Civil Procedure 59(e) states simply that "[a]ny motion to alter or amend a judgment shall be filed no later than 10 days after entry of the judgment," but the rule "does not prescribe specific grounds for granting a motion to alter or amend an otherwise final judgment." Munafo v. Metropolitan Transp. Authority, 381 F.3d 99, 105 (2d Cir. 2004). The Second Circuit has held "that district courts may alter or amend a judgment 'to correct a clear error of law or prevent manifest injustice.'" Id. (quoting Collision v. Int'l Chem. Workers Union, Local 217, 34 F.3d 233, 236 (4th Cir.1994)); see also Wood v. F.B.I., 432 F.3d 78, 85 n.4 (2d Cir. 2005) (affirming denial of Rule 59(e) motion where "district court did not commit error or a manifest injustice."). Other circuits have taken a somewhat more expansive view of the grounds upon which a motion to alter or amend a final judgment may be granted, holding that "[a] motion to alter or amend the judgment is discretionary and need not be granted unless the district court finds that there is an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice." Messina v. Krakower, 439 F.3d 755, 758 (D.C. Cir. 2006) (quoting Firestone v. Firestone, 76 F.3d 1205, 1208 (D.C. Cir.1996)).*fn6 The standard of review governing Rule 59(e) motions "is strict, and reconsideration will generally be denied unless the moving party can point to controlling decisions or data that the court overlooked-matters, in other words, that might reasonably be expected to alter the conclusion reached by the court." Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir. 1995). The court shall therefore review its prior order so as to determine whether it overlooked controlling law or evidence which render the Vaughn III opinion clearly erroneous or manifestly unjust.
B. Timeliness of the Plaintiffs' Motion
Defendant Silver and the Proposed Tanen Defendants argue that the plaintiffs' motion should be rejected by this court as untimely filed. For the reasons stated below, the court rejects both arguments, and holds that the plaintiffs' motion was timely.
1. Plaintiffs' Motion was Timely Filed on August 24, 2006
As previously noted, Rule 59(e) states that "[a]ny motion to alter or amend a judgment shall be filed no later than 10 days after entry of the judgment." Local Civil Rule 6.3*fn7 likewise states that "[a] notice of motion for reconsideration or reargument of a court order determining a motion shall be served within ten (10) days after the entry of the court's determination of the original motion, or in the case of a court order resulting in a judgment, within ten (10) days after the entry of the judgment." Silver argues that the plaintiffs' motion should be denied because it was filed more than ten days after the entry of the August 4 Order, whereas the plaintiffs argue that the motion is timely, having been filed within ten days of the entry of judgment. Although one would ordinarily expect a clear-cut answer to the question of whether the plaintiffs' motion was made within the time allotted by the Federal Rules of Civil Procedure, certain procedural irregularities which occurred after the Vaughn III order was issued complicate that inquiry in this case.
As previously noted, the Vaughn III decision was issued on August 4, 2006. On August 18, 2006, a "Judgment," signed by the Clerk of Court, was entered in the docket. The plaintiffs filed this motion on August 24, 2006, twenty days after the August 4 order, but only six days after the judgment was entered. It would thus appear that the motion, having been filed within ten days of the entry of judgment, was timely. However, Silver argues, on the basis of Fed. R. Civ. P. 54 ("Rule 54"), that the August 18 judgment was improperly entered and therefore should be disregarded for the purpose of evaluating the timeliness of the plaintiffs' Rule 59(e) motion. Rule 54(b) states that
[w]hen more than one claim for relief is presented in an action... the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment.
If the court does not make such an express determination or direction in its order denying relief on some but fewer than all of the claims presented in the case, "any order or other form of decision... which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties." Id. Noting that the court's August 4 Order did not include an "express direction" to enter judgment, Silver surmises that "plaintiffs simply submitted a judgment to the Clerk of Court, who then entered it without any direction to do so by the Court and without any prior notice to the parties," and argues that the judgment entered on August 18 is a "nullity, as there is no authority in the Federal Rules of Civil Procedure Pursuant to which such a 'judgment' can be entered." Memorandum of Law on Behalf of Defendant Martin Silver, Esq. in Opposition to Plaintiffs' Motion for Reconsideration, dated September 7, 2006 ("Silver Mem."), at 3-4. The plaintiffs apparently concede that the August 18 judgment was not properly entered pursuant to Rule 54, but deny Silver's allegation, asserting that "[p]laintiffs neither submitted the [August 18 judgment], nor did plaintiffs direct the Clerk of the Court.... to enter said judgment. To the best of the knowledge of plaintiffs' counsel, this Court submitted the judgment." Memorandum of Law in Reply to Defendants' Memoranda in Opposition to Plaintiffs' Motion for Reconsideration Pursuant to F.R.C.P. § 59(e) and Local Rule 6.3, dated September 12, 2006 ("Reply Mem."), at 7 (emphasis in original).
If the court were to determine that the plaintiffs drafted and submitted a judgment to the Clerk of Court for entry, with no authority to do so having been granted by this court, for the purpose of evading the ten-day limitation imposed by Rule 59(e) and Local Rule 6.3, it would be inclined to deny the instant motion as untimely and to entertain a motion for sanctions against the plaintiffs' counsel. However, having conducted its own inquiry into the matter, the court has determined that the plaintiffs were not involved in the preparation or entry of the August 18 judgment, which resulted from a purely internal miscommunication with the court's administrative staff.*fn8 It appears that, when the August 4 Order was sent to the District Clerk for docketing, an administrative worker prepared and entered the judgment without a specific instruction to do so from this court, failing to recognize that the August 4 Order did not extinguish all claims against all parties in this action. While it is true that the ten-day period within which to move for reconsideration of the August 4 Order lapsed on August 14, 2006, four days before the entry of judgment on August 18, under the circumstances the court will accept the plaintiffs' assertion that they "were required [by the Office of the District Clerk] to wait until the clerk docketed ...