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Schwartz v. HSBC Bank USA, N.A.

United States District Court, S.D. New York

June 19, 2017

BRUCE SCHWARTZ, individually and on behalf of all others similarly situated, Plaintiff,
HSBC BANK USA, N.A., Defendant.


          KATHERINE POLK FAILLA United States District Judge.

         In an Opinion and Order dated January 9, 2017, the Court granted Defendant HSBC Bank USA N.A.'s motion to dismiss Plaintiff Bruce Schwartz's Second Amended Complaint (the “SAC”). See Schwartz v. HSBC Bank USA, N.A., No. 14 Civ. 9525 (KPF), 2017 WL 95118, at *1 (S.D.N.Y. Jan. 9, 2017) (“Schwartz II”). On January 23, 2017, Plaintiff moved, pursuant to Federal Rules of Civil Procedure 59(e) and 15(a), and Local Civil Rule 6.3, to reopen this case and vacate the judgment entered on January 11, 2017, and also (i) for reconsideration of Schwartz II; or, alternatively, (ii) for leave to file a Third Amended Complaint (the “TAC”) nunc pro tunc. For the reasons that follow, Plaintiff's motion is denied in its entirety.


         Plaintiff filed his original Complaint on December 1, 2014, and a First Amended Complaint (the “FAC”) on March 27, 2015 (Dkt. #2, 12), alleging that Defendant violated the Truth in Lending Act (“TILA” or the “Act”), 15 U.S.C. §§ 1601-1677f, and its implementing regulations. In a February 9, 2016 Opinion and Order, the Court held, inter alia, that Plaintiff had sufficiently stated a claim for violation of TILA disclosure requirements concerning penalty annual percentage rates (or “APRs”). See Schwartz v. HSBC Bank USA, N.A., 160 F.Supp.3d 666, 681-82 (S.D.N.Y. 2016) (“Schwartz I”).

         Following a February 23, 2016 conference, the Court stayed this action pending the Supreme Court's anticipated decision in Spokeo, Inc. v. Robins, 136 S.Ct. 1540 (2016), which was issued on May 16, 2016, and revised on May 24, 2016. Thereafter, the Court held a conference on June 9, 2016, and set a schedule for the filing of the SAC and of Defendant's Spokeo-based motion to dismiss for lack of subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1) (Dkt. #45, 49); that motion was fully briefed on August 31, 2016 (Dkt. #51-54). On November 23, 2016, the Second Circuit issued Strubel v. Comenity Bank, 842 F.3d 181 (2d Cir. 2016), and this Court granted the parties leave to submit supplemental letter briefs concerning the effect, if any, of Strubel on the pending motion; the parties filed those briefs on December 16, 2016. (Dkt. #59-60).

         In Schwartz II, the Court dismissed this action for lack of subject matter jurisdiction on the grounds that “Plaintiff [had] fail[ed] plausibly to plead the concrete and particularized injury necessary to establish Article III standing.” Schwartz II, 2017 WL 95118, at *4; id. at *7 (“[W]ell-pled allegations describing Plaintiff's injuries are found nowhere in the SAC.”). Schwartz II began by outlining the statutory and regulatory framework of TILA and Regulation Z, including the disclosure provisions concerning interest-rate hikes for late payments. Id. at *2-3. It next surveyed standing doctrine in light of Spokeo and Strubel, paying special attention to the concreteness and particularization requirements of the injury-in-fact element. Id. at *3-5. Finally, the Opinion examined the SAC's sparse, conclusory allegations of injury and concluded that Plaintiff had “fail[ed] to carry his burden to clearly allege facts demonstrating a concrete … [and] particularized injury to support standing.” Id. at *6-8; see Id. at *6 (“Mere incantations of ‘concrete harm' and ‘material risk of concrete harm, ' or of the purpose statement of TILA, are plainly insufficient to plead plausibly that Plaintiff suffered a concrete injury.”); id. at *7 (“[The SAC's] allegations that Plaintiff personally and individually suffered an injury as a result of those violations are conclusory and inadequately pled.”)

         The Court also denied Plaintiff leave to file a TAC because Plaintiff never sought leave to do so. See Schwartz II, 2017 WL 95118, at *8 (“Plaintiff has not sought leave to amend his complaint a third time and, accordingly, the Court affords him no such opportunity.” (citing Shields v. Citytrust Bancorp, Inc., 25 F.3d 1124, 1132 (2d Cir. 1994) (“Although federal courts are inclined to grant leave to amend following a dismissal order, we do not deem it an abuse of the district court's discretion to order a case closed when leave to amend has not been sought.”))). The Court noted, however, that dismissal of the SAC was without prejudice “because the dismissal [wa]s one for lack of subject matter jurisdiction, which deprives the Court of its ability to issue a prejudicial dismissal.” Id. (citing Carter v. HealthPort Techs., LLC, 822 F.3d 47, 54 (2d Cir. 2016); Hernandez v. Conriv Realty Assocs., 182 F.3d 121, 123 (2d Cir. 1999)).

         Plaintiff filed the instant motion, supporting brief, and declaration on January 23, 2017 (Dkt. #65-67); Defendant filed its opposition brief on February 6, 2017 (Dkt. #68); and Plaintiff filed his reply brief on February 13, 2017 (Dkt. #69).


         A. Applicable Law

         Federal Rule of Civil Procedure 59(e) allows a district court “to alter or amend a judgment.” Fed.R.Civ.P. 59(e). “Generally, district courts will only amend or alter a judgment pursuant to Rule 59 ‘to correct a clear error of law or prevent manifest injustice.'” In re Assicurazioni Generali, S.P.A., 592 F.3d 113, 120 (2d Cir. 2010) (quoting Munafo v. Metro. Transp. Auth., 381 F.3d 99, 105 (2d Cir. 2004)). The rule “covers a broad range of motions, ” and “the only real limitation on the type of motion permitted is that it must request a substantive alteration of the judgment, not merely the correction of a clerical error, or relief of a type wholly collateral to the judgment.'” ING Glob. v. United Parcel Serv. Oasis Supply Corp., 757 F.3d 92, 96 (2d Cir. 2014) (internal quotation marks omitted) (quoting Schwartz v. Liberty Mut. Ins. Co., 539 F.3d 135, 153 (2d Cir. 2008)).

         A motion to alter or amend the judgment under Rule 59(e) is assessed under the same standard as a motion for reconsideration under Local Civil Rule 6.3. See Oocl (USA) Inc. v. Transco Shipping Corp., No. 13 Civ. 5418 (RJS), 2016 WL 4481153, at *1 (S.D.N.Y. Aug. 23, 2016); In re Evergreen Mut. Funds Fee Litig., 240 F.R.D. 115, 117 (S.D.N.Y. 2007) (collecting cases). Both rules “are meant to ‘ensure the finality of decisions and to prevent the practice of a losing party examining a decision and then plugging the gaps of a lost motion with additional matters.'” Cancel v. Kelly, No. 13 Civ. 6007 (JMF), 2016 WL 1559166, at *1 (S.D.N.Y. Apr. 15, 2016) (quoting Medisim Ltd. v. BestMed LLC, No. 10 Civ. 2463 (SAS), 2012 WL 1450420, at *1 (S.D.N.Y. Apr. 23, 2012)); see also Artists Rights Enf't Corp. v. Estate of King, No. 16 Civ. 1121 (JPO), 2017 WL 2062988, at *1 (S.D.N.Y. May 15, 2017) (recognizing reconsideration as “an extraordinary remedy to be employed sparingly in the interests of finality and conservation of scarce judicial resources[.]” (citations omitted)).

         A motion for reconsideration is governed by a “strict” standard and is generally denied “unless the moving party can point to controlling decisions or data that the court overlooked.” Analytical Surveys, Inc. v. Tonga Partners, L.P., 684 F.3d 36, 52 (2d Cir. 2012) (internal citation omitted). Thus, reconsideration is appropriate “only when the [movant] identifies [i] an intervening change of controlling law, [ii] the availability of new evidence, or [iii] the need to correct a clear error or prevent manifest injustice.” Kolel Beth Yechiel Mechil of Tartikov, Inc. v. YLL Irrevocable Tr., 729 F.3d 99, 104 (2d Cir. 2013) (citation omitted); see also Bldg. Serv. 32BJ Health Fund v. GCA Servs. Grp., Inc., No. 15 Civ. 6114 (PAE), 2017 WL 1283843, at *1 (S.D.N.Y. Apr. 5, 2017) (“A party seeking reconsideration ‘is not supposed to treat the court's initial decision as the opening of a dialogue in which that party may then use such a motion to advance new theories or adduce new evidence in response to the court's rulings.'” (quoting De Los Santos v. Fingerson, No. 97 Civ. 3972 (MBM), 1998 WL 788781, at *1 (S.D.N.Y. Nov. 12, 1998)).

         B. ...

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