United States District Court, S.D. Indiana, Indianapolis Division
ORDER DENYING DEFENDANTS' MOTION TO ALTER AND/OR
AMEND FINAL JUDGMENT
WALTON PRATT, JUDGE.
matter is before the Court on Defendants Mark C. Ladendorf
Attorney at Law, P.C. (“Mr. Ladendorf”) and
Timothy F. Devereux's (“Mr. Devereux”)
(collectively, “the Lawyers”) Motion to Alter
and/or Amend Final Judgment, Pursuant to F.R.C.P. 59.
(Filing No. 187). The Lawyers contend that this
Court failed to enter judgment in favor of several nonparties
to this lawsuit. For the reasons that follow, the
Lawyers' motion is DENIED.
William F. Conour (“Mr. Conour”) was convicted of
stealing more than $4.5 million from client trust accounts.
The Conour Law Firm, LLC (“the Conour firm”) owes
money to several individuals who were victims of Mr.
Conour's fraud, including David L. Beals, Sr., Loretta
Beals, Kristen Beals by her Guardians, David L. Beals, Sr.
and Loretta Beals (“the Intervenors”) and to
Plaintiff ACS 2006 (“ACS”), one of the Conour
firm's lenders. Shortly before the fraud came to light,
Mr. Devereux left the Conour firm, taking twenty-one clients
with him to Mr. Ladendorf's law firm (“the
clients ultimately produced nearly $2 million in
attorneys' fees. (Filing No. 151 at 4-10.) In
the instant case, the parties first disputed how much of that
money should be paid to the Conour firm for work it performed
before Mr. Devereux left for the Ladendorf firm. Second, if
money is owed to the Conour firm, the parties disputed how
that money should be allocated among the Intervenors and ACS,
the entities to whom the Conour firm owes money.
a bench trial, this Court concluded that the Conour firm was
entitled to approximately $775, 000.00 of the $2 million, and
that in recovering any amounts owed, ACS had priority over
the Intervenors. (Filing No. 151 at 19.) Both the
Intervenors and the Lawyers appealed that judgment, with the
Lawyers challenging the amount owed to the Conour firm, and
the Intervenors appealing the issue of priority. (Filing
No. 153; Filing No. 159.) On appeal, the
Seventh Circuit concluded that this Court erred in
determining the amount of money owed to the Conour firm, and
outlined a quantum merit distribution that amounts
to $358, 069.83. (Filing No. 180 at 6-9.) The
Seventh Circuit also concluded that the Intervenors have
priority over ACS in recovering any amount owed. (Filing
No. 180 at 14-15.) Because Mr. Conour owes the
Intervenors substantially more than the amount of this
judgment, the entire amount will go to them, leaving nothing
for ACS. (Filing No. 180 at 10.) The Seventh
Circuit's mandate instructed this Court that “[t]he
judgment of the district court is REVERSED, and the case is
REMANDED for the entry of judgment consistent with this
opinion.” (Filing No. 180 at 15.)
accordance with this district's Local Rule 16-2, the
parties each filed position statements regarding the entry of
judgment. (Filing No. 182; Filing No. 183.)
As relevant here, in their position statement, the Lawyers
requested that the Court determine and award co-counsel fees
to the Ken Nunn Law Office (“Ken Nunn”) and the
Keller & Keller Law Firm (“Keller &
Keller”)- law firms with whom the Ladendorf firm
purports to have co-counsel fee agreements. (Filing No.
183.) This Court entered judgment against ACF, and in
favor of the Intervenors in the amount of $358, 069.83.
(Filing No. 185.) The Court declined the
Lawyers' invitation to award judgment to the nonparty law
firms. (Filing No. 185 at 1-2.) The Lawyers then
filed the instant Motion to Alter and/or Amend Final
Judgment, Pursuant to F.R.C.P. 59(e). (Filing No.
motion to alter or amend a judgment under Rule 59(e)
“must be filed no later than 28 days after the entry of
the judgment.” Fed.R.Civ.P. 59(e). The purpose of a
motion to alter or amend a judgment is to ask the court to
reconsider matters “properly encompassed in a decision
on the merits.” Osterneck v. Ernst &
Whinney, 489 U.S. 169, 174 (1989). “A Rule 59(e)
motion will be successful only where the movant clearly
establishes: (1) that the court committed a manifest error of
law or fact, or (2) that newly discovered evidence precluded
entry of judgment.” Cincinnati Life Ins. Co. v.
Beyrer, 722 F.3d 939, 954 (7th Cir. 2013) (citation and
quotation marks omitted).
manifest error “is not demonstrated by the
disappointment of the losing party. It is the wholesale
disregard, misapplication, or failure to recognize
controlling precedent.” Oto v. Metro. Life Ins.
Co., 224 F.3d 601, 606 (7th Cir. 2000) (citation and
quotation marks omitted). Furthermore, “a Rule 59(e)
motion is not an opportunity to relitigate motions or present
arguments, issues, or facts that could and should have been
presented earlier.” Brownstone Publ'g, LLC v.
AT&T, Inc., 2009 WL 799546, at *3 (S.D. Ind. 2009).
Relief pursuant to a Rule 59(e) motion to alter or amend is
an “extraordinary remed[y] reserved for the exceptional
case.” Foster v. DeLuca, 545 F.3d 582, 584
(7th Cir. 2008).
Lawyers take issue with the fact that this Court “did
not take into account the co-counsel fee agreements”
between the Conour firm, Keller & Keller, and Kenn Nunn
when it entered judgment in favor of the Intervenors.
(Filing No. 187 at 6.) In short, the Lawyers contend
that this Court was required to allocate a portion of the
judgment to Ken Nunn and Keller & Keller. The Intervenors
respond that, as nonparties, Keller & Keller and Ken Nunn
do not have standing to request a judgment in their favor.
(Filing No. 189 at 1-3.) Likewise, they argue, the
Lawyers have no standing to advocate on behalf of the
nonparties. (Filing No. 189 at 1-3.) The Intervenors
also argue that the Lawyers failed to raise any issues
related to the nonparty law firms on appeal, and have
therefore waived their ability to raise the issue in this
motion. (Filing No. 189 at 3.)
Judgment in Favor of Nonparties
Court again notes the standard under which a Rule 59(e)
motion is reviewed. Such a motion will only succeed where the
movant clearly establishes that the court committed a
manifest error of law or fact, or where newly
discovered evidence precluded the entry of judgment. See
Beyrer, 722 F.3d at 954. A manifest error “is not
demonstrated by the disappointment of the losing party. It is