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Corwin v. NYC Bike Share LLC

United States District Court, S.D. New York

April 7, 2017

RONALD D. CORWIN, et al., Plaintiffs,
v.
NYC BIKE SHARE, LLC, et al., Defendants.

          OPINION & ORDER

          SAKAH NETBURN, United States Magistrate Judge

         Familiarity with the factual background of this case is assumed. On March 1, 2017, the Court issued an Opinion and Order on the parties' cross-motions for summary judgment. Corwin v. NYC Bike Share, LLC, No. 14-CV-1285 (SN), 2017 WL 816134 (S.D.N.Y. Mar. 1, 2017). With the exception of defendants Alta Planning Design Inc. and Alta Planning Design Architecture of New York, PLLC, (collectively, “APD”) who were granted summary judgment on plaintiffs' claim, every remaining party has moved for some form of relief from this decision.[1]

         Defendants Metro Express Services, Inc. (“Metro Express”) and Sealcoat USA, Inc. (“Sealcoat”) move for reconsideration under Federal of Rule of Civil Procedure 54(b) and Local Civil Rule 6.3 and for leave to amend their answers to include affirmative defenses based on the release in the CitiBike User Agreement (“Agreement”). ECF No. 400. In the Opinion and Order, the Court held that the Agreement released plaintiffs' claims against Motivate International (f/k/a Alta Bicycle Share, Inc.) and NYC Bike Share, LLC; however, because Metro Express and Sealcoat never asserted the Agreement as an affirmative defense in their answers and did not address the issue in their summary judgment briefing, the Court did not consider its applicability to these parties.

         Defendants Motivate International and NYC Bike Share, LLC (collectively, “NYCBS”) move for reconsideration under Federal of Rule of Civil Procedure 54(b) and Local Civil Rule 6.3 of the March 1, 2017 Opinion and Order to the extent that it denied summary judgment to NYCBS on plaintiffs' claims of gross negligence. ECF No. 402. The Court found that summary judgment was inappropriate because a reasonable factfinder could conclude that NYCBS's conduct was sufficiently reckless and/or aggravated to meet the gross negligence standard. Corwin, 2017 WL 816134, at *28. Defendants Metro Express and Sealcoat filed a notice of joinder in this motion for reconsideration. ECF No. 406.

         Plaintiffs Ronald D. Corwin and Beth Blumenthal (collectively, “Corwin”) move for reconsideration under Federal of Rule of Civil Procedure 54(b) and Local Civil Rule 6.3 of the March 1, 2017 Opinion and Order on two primary bases: (1) that the enforcement of the CitiBike User Agreement against Corwin is improper because a proper reading of the Agreement indicates that it does not apply to street treatments such as wheel stops; and (2) the Agreement is unenforceable as to NYCBS because New York City Administrative Code § 19-110 provides Corwin a private right of action that cannot be waived. ECF No. 403. Invoking the same federal and local rules, Corwin also seeks “clarification” of the Court's decision as to the burden of proof necessary to demonstrate the City's liability, arguing that liability will be established if City contractors affirmatively created the hazards that causes his injuries. Id.

         Defendant City of New York (the “City”) moves for an order pursuant to 28 U.S.C. § 1292(b), permitting it to file an interlocutory appeal to the Court of Appeals for the Second Circuit on the issue of whether New York State public policy prevents the City's enforcement of the Agreement as it applies to CitiBike stations on public roadways. ECF No. 401. In the Opinion and Order, the Court held that such a waiver was contrary to the “public policy of guaranteeing the safety of the users of City streets . . . that underlies its non-delegable duty to keep streets and roadways safe, ” and therefore found that it was unenforceable as to plaintiffs. Corwin, 2017 WL 816134, at *15.

         For the reasons set forth below, all of the motions, including Corwin's motion for clarification and reconsideration, Metro Express and Sealcoat's motion for reconsideration and to amend their answers, NYCBS's motion for reconsideration, and the City's motion for leave to appeal under 28 U.S.C. § 1292(b) are DENIED.

         LEGAL STANDARD

         “The standards governing a motion for reconsideration under Local Rule 6.3 are the same as those under Federal Rule of Civil Procedure 59(e).” Abrahamson v. Bd. of Educ., 237 F.Supp.2d 507, 510 (S.D.N.Y. 2002). To prevail on such a motion, “the movant must demonstrate ‘an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.'” Catskill Dev., L.L.C. v. Park Place Entm't Corp., 154 F.Supp.2d 696, 701 (S.D.N.Y. 2001) (quoting Doe v. NYC Dep't of Soc. Servs., 709 F.2d 782, 789 (2d Cir. 1983)). “The standard for granting such a motion 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, 256-57 (2d Cir. 1995). “[A] motion to reconsider should not be granted where the moving party seeks solely to relitigate an issue already decided.” Id. at 257. Likewise, motions for reconsideration cannot be based on arguments not previously raised. See Sequa Corp. v. GBJ Corp., 156 F.3d 136, 144 (2d Cir. 1998) (“Rule 59 is not a vehicle for . . . presenting the case under new theories, securing a rehearing on the merits, or otherwise taking a ‘second bite at the apple.'”).

         ANALYSIS

         I. Metro Express and Sealcoat's Motions for Reconsideration

         In support of their motion for reconsideration, Metro Express and Sealcoat argue that any negligence claims maintained against them by Corwin should be released by virtue of the Release Agreement because the Agreement applied by its terms to “agents” of the City and NYCBS, and they were in an agency relationship with NYCBS. An essential characteristic of an agency relationship is that the agent acts subject to the principal's direction and control. In re Shulman Transp. Enterprises, Inc., 744 F.2d 293, 295 (2d Cir. 1984). Under New York law, “an agent must have authority, whether apparent, actual or implied, to bind his principal.” Merrill Lynch Interfunding, Inc. v. Argenti, 155 F.3d 113, 122 (2d Cir. 1998). Demonstrating actual authority requires “the following elements: (1) manifestation by the principal that the agent shall act for him; (2) the agent accepted the undertaking; and (3) an understanding between the parties that the principal is to be in control of the undertaking.” Spagnola v. Chubb Corp., 264 F.R.D. 76, 89 (S.D.N.Y. 2010) (citations omitted). Apparent authority requires “words or conduct of the principal, communicated to a third party, that give rise to the appearance and belief that the agent possesses authority to enter into a transaction.” Standard Funding Corp. v. Lewitt, 89 N.Y.2d 546, 551 (1997).

         Nevertheless, “[n]ot all relationships in which one person provides services to another satisfy the definition of agency.” Artists Rights Enf't Corp. v. Estate of King, No. 16-CV-1121 (JPO), 2016 WL 7192093, at *4 (S.D.N.Y. Dec. 12, 2016) (citing Restatement (Third) of Agency § 1.01 (2006)). Corwin, the City, and NYCBS argue that Metro Express and Sealcoat were not agents of NYCBS and suggest that they were independent contractors. The fact that Metro Express had some form of contractual relationship with NYCBS to perform services does not automatically indicate that it was NYCBS's agent. See Tartaglione v. Shaw's Express, Inc., 790 F.Supp. 438, 441 (S.D.N.Y. 1992) (distinguishing agent from independent contractor who “in exercising an independent employment . . . is not subject to the control of the [person with whom he has contracted], except as to the result of his work”) (citation omitted).

         Metro Express and Sealcoat rely extensively on Vornado Realty Trust v. Marubeni Sustainable Energy, Inc., 987 F.Supp.2d 267 (E.D.N.Y. 2013), where the district court applied a release, containing similar “agent” language, negotiated between a property owner and a contractor to a subcontractor. That case, however, is readily distinguishable. That court was able to determine that “no reasonable jury could fail to conclude the [the subcontractor] was the agent of the [contractor]” and that “there are no genuine issues of material fact as to whether an agency relationship existed between [the two parties].” Id. at 281. Vornado Realty Trust certainly does not stand for the proposition that all subcontractors are agents of their general contractors, and the court's decision was rooted in specific document and deposition discovery regarding the parties' intent and the scope of the release. Id. at 273-74.[2]

         The Court need not, however, wade into the complex “mixed question of law and fact, ” Commercial Union Ins. Co. v. Alitalia Airlines, S.p.A., 347 F.3d 448, 462 (2d Cir. 2003), in determining whether or not Metro Express or Sealcoat were agents of the City or NYCBS. It is clear that both defendants waived any claim that the Release Agreement barred Corwin's claims against them by failing to raise it as an affirmative defense in their answers and/or failing to move to amend their answers in a timely fashion to include such a defense. Because they did not raise the Release Agreement as an affirmative defense, no party had any incentive to conduct discovery into the presence or absence of an agency relationship between Metro Express, Sealcoat, and NYCBS or any other defendant. The Court is constrained to deny their eleventh-hour, post-summary judgment motion to amend their answers to remedy this deficiency, because such an amendment would cause substantial prejudice to the remaining parties.

         A. Metro Express and Sealcoat's Deficient Answers

         On February 22, 2016, Sealcoat filed its answer, alleging a Seventh Affirmative Defense that “[t]he plaintiffs' actions are barred by the doctrine of waiver, estoppel, laches, and/or ratification.” ECF No. 211. On February 23, 2016, Metro Express filed an answer raising as its Eighth Affirmative Defense that “[p]laintiff's claims are barred by the applicable statute(s) of limitation and/or the doctrine of laches, waiver and/or estoppel” and as its Tenth Affirmative Defense that “[p]laintiffs' claims are barred by the doctrines of waiver and/or estoppel.” ECF No. 213 at ¶¶ 453, 455. As Corwin argues, while these affirmative defense make a general reference to “waiver, ” they are reasonably construed to refer to defenses grounded in undue delay or conduct inconsistent with Corwin's claims, not those relating to an exculpatory release agreement.

         Metro Express and Sealcoat were fully aware of the contents of the Release Agreement at issue. Corwin affirms that the Release Agreement was provided as an exhibit to these defendants before their joinder in this case as early as October 30, 2015, months before their answer was due. Pls.' Opp. Mem, ECF No. 417 at 9-10. Corwin's Local Civil Rule 56.1 Statement, submitted in support of his summary judgment motion, alleged that neither Metro Express nor Sealcoat was an agent or otherwise a “Released Person” under the terms of the Release Agreement (ECF No. 310 at ¶¶ 37-38), and neither defendant submitted a counter-statement to this statement. Therefore, these statements were deemed admitted for the purpose of the summary judgment motion. See S.D.N.Y. Local Civil Rule 56.1(c) (“Each number paragraph in the [56.1 Statement] will be deemed to be admitted for purposes of the motion unless specifically controverted by a correspondingly numbered paragraph in the statement required to be served by the opposing party.”)

         B. Metro Express and Sealcoat's Tardy Motions to ...


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