The opinion of the court was delivered by: Sidney H. Stein, U.S. District Judge.
Plaintiff M.L. Private Finance LLC ("MLPF") moves pursuant to Local Civil Rule 6.3 for reconsideration of this Court's Order dated April 4, 2011, granting the motion of defendants Halsey McLean Minor and The Halsey McLean Minor Revocable Trust (collectively, "defendants" or "Minor") to terminate the receiver and discharge the liens asserted over certain artwork owned by Minor. MLPF seeks reconsideration only insofar as the April 4 Order permitted the discharge of MLPF's secured interest in collateral that was not subject to the Receivership Order dated April 1, 2010. For the reasons set forth below, plaintiff's motion for reconsideration is denied.
MLPF brought this diversity action to recover money it had lent to defendants pursuant to a promissory note defendants did not repay. MLPF and Minor had entered into a Loan Agreement whereby Minor borrowed in excess of $20 million from MLPF. The Loan Agreement granted MLPF a "continuing first-priority lien and security interest" in certain artwork pledged as collateral until defendants' obligations under the Loan Agreement had "indefeasibly been paid and performed in full." (Loan Agreement, Ex. 1 to Decl. of James W. Kennedy dated Oct. 7, 2010 at 18, 32, Dkt. No. 138.)
In October 2009, the Court granted plaintiff's motion for summary judgment on its claims for a money judgment of $21,502,907.60 on the promissory note as well as payment of the costs and fees incurred in collecting on that note (the "Costs of Collection"). The Court also granted plaintiff's motion to dismiss defendants' counterclaims. Plaintiff moved for entry of an order of final judgment solely with respect to Count One-for breach of the promissory note-pursuant to Federal Rule of Civil Procedure 54(b). In support of the motion, plaintiff wrote that the "Eleventh Cause of Action for costs of collection of the debt is a separate contract right, involving separate damages." (Pl.'s Letter dated Oct. 21, 2009, Dkt. No. 79.) The Court granted that motion and directed that Rule 54(b) final judgment be entered only on Count One-plaintiff's claim for payment of the promissory note. (Rule 54(b) Order dated Oct. 23, 2009, Dkt. No. 80.) The Court also directed plaintiff to submit an application for its Costs of Collection. (Order dated Oct. 23, 2009, Dkt. No. 82.)
In November 2009, plaintiff submitted its first application for costs, which included the fees and the costs it incurred in litigating Minor v. ML Private Finance LLC, BC 409337 (Cal. App. Dep't Super. Ct.), a separate action in California state court between plaintiff and Minor (the "California action"). In April 2010, the Court granted that application in part, awarding MLPF $1,268,655.00 as its collection costs in litigating this action through October 2009. However, the Court determined that the costs MLPF had incurred in litigating the California action were not recoverable under the parties' Loan Agreement. (See Transcript of April 1, 2010 hearing at 7:10-12; Order dated Apr. 1, 2010, Dkt. No. 112.) During the next nine months, MLPF continued to accrue collection costs in its efforts to enforce the money judgment on Count One in this action and, thereafter, to obtain its legal fees and expenses. Based on those accruing fees and expenses, the Court granted MLPF's three successive applications for Costs of Collection in an amount totaling $659,371.42. (See Ordersdated Nov. 12, 2010, Dec. 22, 2010, and Jan. 26, 2011, Dkt. Nos. 151, 157, 162.)
The Court also appointed Phillips, de Pury & Company, LLC as Receiver for all property of defendants in the possession of Christie's auction house and the Paul Kasmin Gallery, including artwork that defendants had pledged as collateral in the Loan Agreement. (Receivership Order dated Apr. 1, 2010, Dkt. No. 111.) In the Receivership Order, the Court directed Phillips to sell the artwork and to deliver the proceeds to MLPF in satisfaction of the money judgment on the promissory note. Phillips has done so.
In October 2010, defendants filed a motion seeking to terminate the Receivership and to discharge the Uniform Commercial Code liens that MLPF had filed on defendants' artwork. Defendants argued that such relief was warranted because they had fully paid the $21,502,907.60 money judgment on the promissory note and the $177,671.68 in preand post-judgment interest on that judgment. Minor also urged that if the liens were not released he would be severely prejudiced because he would be unable to sell the encumbered art to pay massive debts owed other creditors. MLPF did not dispute that the underlying judgment and interest had been paid, but opposed the motion on several grounds, chief among them that granting such relief was premature given that defendants had not fully paid plaintiff's collection costs.
In a March 22, 2011 letter, defendants informed the Court that they had fully paid MLPF's court-awarded Costs of Collection, including all outstanding interest-as well as additional costs that MLPF had incurred since the fourth application-and therefore requested that the Court grant their motion to terminate the receiver and discharge the liens. Plaintiff did not dispute that everything the Court determined plaintiff was due had been paid to plaintiff. Nevertheless, MLPF argued that Minor's motion should be denied because, in addition to its previous opposition to the motion, (1) MLPF had recently filed a cross-complaint against Minor in the California action seeking indemnification in that action,*fn1 and (2) one of Minor's companies, Carter Grove LLC, had recently filed a voluntary bankruptcy petition.
In an Order dated April 4, 2011, this Court found that neither MLPF's cross-complaint in the California action nor the Carter Grove bankruptcy provided a basis for keeping the liens in place and, having determined that defendants had paid the judgment and all court-awarded Costs of Collection in this action, granted defendants' motion. On April 18, 2011, plaintiff moved for reconsideration of that Order.
A request for reconsideration under Local Civil Rule 6.3 "must demonstrate controlling law or factual matters put before the court in its decision on the underlying matter that the movant believes the court overlooked and that might reasonably be expected to alter the conclusion reached by the court." Hinds Cty., Miss. v. Wachovia Bank N.A., 708 F. Supp. 2d 348, 369 (S.D.N.Y. 2010). "The provision for reargument is not designed to allow wasteful repetition of arguments already briefed, considered and decided." Id. (citation omitted). The standard for granting such a motion is strict. See Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir. 1995). "The major grounds justifying reconsideration are an intervening change in controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice." Virgin Atl. Airways, Ltd. v. Nat'l Mediation Bd., 956 F.2d 1245, 1255 (2d Cir. 1992) (internal quotation marks omitted).
MLPF urges reconsideration on the basis of the same arguments it raised in its brief opposing defendants' motion to terminate the receiver and discharge the liens. Plaintiff has not proffered new or overlooked evidence or any legal authority binding on the Court that might reasonably be expected to alter this Court's April 4 Order. Nonetheless, according to plaintiff, the Court's April 4 Order did not address the following assertions made by plaintiff: (1) that the Court lacked subject matter jurisdiction to order the release of liens on collateral that was not included in the Receivership Order, and (2) that release of the liens was improper because defendants still have contingent obligations under the Loan Agreement. Because the Court has already considered ...