OPINION AND ORDER
“Inveterate UCC geek[s]” are advised to draw near: On Plaintiffs Motion for Reconsideration, the Court must revisit this “classic” Article 9 case. Tim Zinnecker, You Had Me at “UCC” The Faculty Lounge (Apr. 1, 2013, 10:16 a.m.), http:// www.thefacultylounge.org/2013/04/you-hadme-at-uce.html.
Plaintiff and Defendant each claim to possess a superior interest in two truck chassis. Plaintiff is the consignor of the chassis; Defendant provided surety bonds to two Fire Districts that purchased the chassis. In a previous Opinion and Order dated December 18, 2012, the Court found
Plaintiffs Motion is denied. First, this is the paradigmatic case that the strict rules governing motions for reconsideration were written to prevent: Plaintiff had both a pre-argument and, over Defendant’s objections, a post-argument opportunity to brief the factual and legal issues that Plaintiff raises in its instant Motion for Reconsideration. See Schuster v. Dragone Classic Motor Cars, No. 99-CV-2163,
I. Background
The Court assumes the Parties’ familiarity with the factual and procedural history of this case, as described in Arthur Glick Truck Sales v. Stuphen East Corp.,
II. Discussion
A. Standard of Review
“Motions for reconsideration are governed by Federal Rule of Civil Procedure 59(e) and Local Civil Rule 6.3, which 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.” Pla v. Renaissance Equity Holdings LLC, No. 12-CV-5268,
B. The Special Circumstances Meriting Reconsideration
At the outset, Plaintiff suggests that this case is a particularly appropriate candidate for reconsideration, because of “the complexity of the interplay between the [UCC] ... and the motor vehicle registration statutes as enacted in similar, but not identical forms, by [New York, Wisconsin, and Michigan,]” and because the Court “decided the case upon grounds not urged or briefed by either party.” (Pl.’s Mem. of Law (A) for Recons.; Local Rule 6.3 and (B) for Similar Relief in Accordance with FRCP 59 & 60 (“Pl.’s Recons. Mem.”) 1.)
The Court is surprised and disappointed by Plaintiffs suggestions — both that the issues were too “complex[]” to be effectively briefed in the first (or second) round and that the Court decided the case on grounds not briefed by the Parties. In fact, Defendant has consistently and correctly maintained that pursuant to Article 9, section 311 of the UCC, the UCC’s priority rules, not the state certificate-of-title statutes, govern the Parties’ interests in the chassis. (See Def.’s Mem. in Supp. of Summ. J. (“Def.’s SJ Mem.”) 1-2, 5-10 (arguing that the Party’s interests are defined by Article 9 of the UCC); Def.’s Reply in Supp. of Summ. J. (“Def.’s SJ Reply”) 4-7 (arguing that “Article 9 of the [UCC] governs the priority of interests in the chassis” (emphasis omitted); Def.’s Resp. in Supp. of Summ. J. to Sur-Reply 2-3 (arguing that pursuant to Article 9, section 311 of the UCC, the state certificate-of-title laws do not govern the Parties’ interests); Letter from G. Silver to Court (Nov. 28, 2012) (arguing that even in Plaintiffs post-argument submission, Plaintiff failed to address the significance of section 311).) Defendant has also consistently argued that each Fire District was, under the UCC, a buyer in the ordinary course of business and, consequently, possessed a superior interest in its respective chassis to Plaintiffs. (See Def.’s SJ Mem. 7-9 (arguing that Defendant “obtained the chassis from Wolverine’s bankruptcy trustee for the [F]ire [Districts who were buyers[ ] in[ ] the[ ] ordinary course” (emphasis omitted)); Def.’s SJ Reply 7-8 (arguing that Fire Districts became buyers in the ordinary course upon identification of
Furthermore, at oral argument, Plaintiff seemed finally to realize that it had not yet addressed Defendant’s arguments regarding the “interplay” between the UCC and the state certificate-of-title statutes. Recognizing the weakness of its position, Plaintiff then requested leave to file a post-argument brief to address this issue, notwithstanding the fact that Defendant had already fully briefed it. Defendant quite reasonably objected, but the Court granted Plaintiff “one more bite at the proverbial apple,” noting that Plaintiff was facing “third and long” on this issue. (Hr’g Tr. 15,19-22, Nov. 8, 2012 (emphasis added).) The sur-reply that Plaintiff ultimately filed, however, merely rehashed separate arguments that Plaintiff had made in its initial brief. (See Letter from K. Orseck to Court (Nov. 19, 2012).)
Finally, although the Court’s analysis of the UCC differed from Defendant’s in some respects, the differences primarily had to do with whether Plaintiff ever validly perfected its purchase money security interest in the chassis, and what effect Plaintiffs eventual proper filing had on the Parties’ respective interests. See Glick,
In sum, because Plaintiff had numerous opportunities before the Court issued its Opinion to offer the arguments it now presses, Plaintiffs cry of “foul” rings hollow. The burden therefore remains with Plaintiff to present a valid basis for reconsideration.
C. The Merits
1. The Sales Contract Between Wolverine and the Fire Districts Became Null
Plaintiffs first argument is that the Fire Districts lost buyer-in-the-ordinary-course status, because the sales contracts between Wolverine and the Fire Districts were “breached, rejected, rescinded, can-celled, discharged” or otherwise became “null and void.” (PL’s Recons. Mem. 4.) Plaintiff offers multiple variations of this argument, but each variation fails for two independent reasons. First and independently, these claims are premised on both newly alleged facts — for example, that Defendant filed a proof of claim against Wolverine’s bankruptcy estate — that were readily available to Plaintiff in the predeeisional stage of the litigation, and various propositions of law that did not result from
Second, as the Court will explain, each variation of Plaintiff’s argument regarding the nullification of the contracts is without merit.
Plaintiff first claims that Defendant’s filing of a proof of claim against Wolverine’s bankruptcy estate implied the Fire Districts’ rescission of their sales contracts with Wolverine. This argument fails. On the one hand, “rescission” is a term of art that describes an equitable action by a party to nullify a contract. The Court has been unable to find (and Plaintiff has not cited) any decision from Michigan, New York, or Wisconsin suggesting that filing of proof of claim against a bankruptcy estate is functionally tantamount to rescission of a contract with the debtor. Indeed, Defendant’s proof of claim against Wolverine’s bankruptcy estate was a claim for damages based on the contracts Wolverine executed with the Fire Districts; the filing of the proof of claim therefore was inconsistent with rescission of the contracts. See Evangelical Presbyterian Church v. Am. Fidelity Assurance Co., No. 299625,
' Plaintiff next cites certain provisions of Article 2 of the UCC to argue that the sales contracts between Wolverine and the Fire Districts were “unenforceable.” These provisions set forth certain rights that a buyer may assert against a nonperforming seller through litigation. See UCC §§ 2-711 (setting forth buyer’s rights against nonperforming seller), 2-502 (describing right to recover), 2-716 (describing right to replevin); see also Linda J. Ruseh, Property Concepts in the Revised U.C.C. Articles 2 and 9 Are Alive and Well, 54 SMU L.Rev. 947, 949 (2001) (explaining that these rights “are not self-help remedies” and require a buyer “effectively [to] assert its rights against the seller through litigation”). The Fire Districts did not avail themselves of these remedies, and Defendant has never relied on them as a basis for its superior interest. According to Plaintiff, by failing to exercise these remedies affirmatively against Wolverine, the Fire Districts, and, by extension, Defendant, lost any right to enforce the contracts.
But the Fire Districts effectively bypassed initiating litigation against Wolverine for recovery or replevin by contracting, through Defendant, with Wolverine’s bankruptcy estate for release of the chassis. The method by which the Fire Districts obtained the fire trucks may not have been contemplated by the UCC, but Plaintiff points to nothing in the UCC or the case-law to suggest that a buyer loses its rights or its status under the UCC by pursuing nonstatutory remedies. Indeed, the protections afforded to a buyer in Article 9 of the UCC — including the protections codified in Article 9, section 320, which establish the superior interest of a buyer in the ordinary course against a consignor — are separate from the protections afforded to a buyer in Article 2 against a seller. See generally Rusch, supra, 949-52 (explaining that Article 9 provides buyers with additional protections to those contained in Article 2). Therefore, the fact that the Fire Districts did not utilize their Article 2 remedies does not preclude them from asserting that they nonetheless have a superior interest in the fire trucks, so long as they qualify as buyers in the ordinary course.
The Court held that the Fire Districts so qualified in its previous Opinion, but the Article 2 provisions relied on by Plaintiff also suggest an argument, apparently unrecognized by Plaintiff, that the Fire Districts cannot be buyers in the ordinary course. Under the UCC, a buyer in the ordinary course must, among other things, either have “possession of the goods or [have] a right to recover the goods from the seller under Article 2.” UCC § 1-201(9). The Parties did not previously address — and consequently the Court did not previously consider — whether the Fire Districts satisfied either part of this requirement.
With respect to possession, it is abundantly clear that the Fire Districts did not actually possess the completed fire trucks, which were, at all times relevant to this dispute, in Wolverine’s physical possession. But the UCC also recognizes “constructive possession.” See Havens Steel Co. v. Commerce Bank, N.A. (In re Havens Steel Co.),
In short, because the Fire Districts took constructive possession of the truck chassis, they qualify as buyers in the ordinary course, and they accordingly have a superior interest in the chassis independent of their right to recover or to replevin under Article 2 of the UCC.
Plaintiff next argues that each sales contract was materially breached by both parties — Wolverine never finished construction of the trucks or delivered them; the Fire Districts never completed payment— resulting in their rescission or nullification of the contracts. Here too, Plaintiff has mistakenly relied on a common law-contracts concept, rather than addressing the relevant UCC provision, which governs “[a]nticipatory repudiation.” See UCC § 2-610. That provision states that when
There is room for argument that, by failing to complete construction of the fire trucks for the Fire Districts, Wolverine repudiated the sales contracts in a manner which substantially impaired their value. But, even if true, that repudiation did not nullify the contracts. ’ Instead, Wolverine’s repudiation entitled the Fire Districts to suspend their own performance, which they did; to await performance, which they did; and to resort to any remedy for breach, which they elected not to do. In other words, the Fire Districts’ conduct was permissible under the UCC and does not deprive them of buyer-in-the-ordinary-course status. See id. cmt. 4 (“Inaction ... by the aggrieved- party may leave the matter open but it cannot be regarded as [bad faith by] the repudiating party.”); cf. Al-Misehal Commercial Grp., Ltd. v. Armored Grp. LLC, No. 10-CV1303,
Plaintiff next argues that the Fire Districts, through Wolverine, “[a]bandoned” the sales contracts by entering into “entirely new contracts” — i.e., the stipulations with the bankruptcy estate — “with different parties and very different terms” to purchase the fire trucks. (Pl.’s Recons. Mem. 7.) According to Plaintiff, this conduct “is absolutely demonstrative of the defendant’s rescission and abandonment of the earlier contracts” and is “irresolvably at odds with the original contracts.” (Id.) These assertions are unsupported by any authority: statutory, judicial, or secondary. Moreover, Defendant counters that the stipulations were not new sales contracts, but rather effected a release of the bankruptcy estate’s and its creditors’ interests in the chassis to avoid litigation. In the absence of authority to the contrary, Defendant has the stronger argument. The terms of the stipulations set forth that Defendant was merely acting to enforce the Fire Districts’ rights as buyers in the ordinary course, rather than seeking to purchase the chassis according to new sales contracts. (See Def.’s Rule 56.1 Statement of Material Facts, Ex. C ¶¶ F, J, L, 3 (Beaverkill stipulation, which states that “Travelers asserts that Beaverkill is the owner of the truck,” VIN 2NKHHN8X89M243581, “because Beaver-
2. Defendant Purchased the Trucks as a Surety, Not a Subrogee
Plaintiff next argues that Defendant could not assert the Fire District’s buyer-in-the-ordinary-course status when it entered into the stipulations with the bankruptcy estate, because its subrogation rights had not yet attached. This argument, too, is precisely the wrong kind of argument for Plaintiff to be making in this posture: Plaintiff had numerous opportunities to brief this argument prior to the Court’s December 18, 2012 Opinion, and the law has not changed in the interim. See In re Refco,
But Plaintiffs argument also fails on the merits. Indeed, it is unclear to the Court why Defendant’s ability to assert the Fire Districts’ rights when Defendant entered the stipulations is the operative question. Even if Plaintiff is correct that Defendant’s surety rights had not yet attached, see In re RLI Ins. Co. v. N.Y. State Dep’t of Labor,
At this point, the case has been going on for approximately two years; the Parties have submitted two rounds of legal briefs, one of which included sur-replies; and the Court has heard oral argument and issued two Opinions. At some point, Plaintiff has to move on — either to the appellate court or to the next case. For now, however, the Clerk of Court is respectfully directed to terminate the pending motion, (Dkt. No. 54); the case is to remain closed.
SO ORDERED.
Notes
. In its previous Opinion, because the Parties disputed whether the UCC provided the governing framework, the Court cited UCC provisions by specific Michigan, New York, and Wisconsin statutory provisions. Here, because the controlling nature of the UCC is no
. Indeed, had Plaintiff raised this argument in its initial Memorandum of Law, the Court might have requested briefing on some of the subsidiary issues the Court must now address — including whether the UCC encompasses constructive possession and whether the Fire Districts took constructive possession of the chassis. But because the case is now before the Court in the posture of Plaintiffs Motion for Reconsideration, and because this argument (which Plaintiff raised only obliquely) is not an appropriate basis for reconsideration, the Court is unwilling to delay resolution of this dispute further. See Schuster,
. The Court was unable to find any decisions addressing whether, under Michigan, New York, or Wisconsin law, the revised definition of buyer in the ordinary course encompasses constructive possession. The Court therefore has relied on persuasive authority: decisions interpreting the identical UCC provision under Missouri, Iowa, and Kansas law.
. To be clear: The Court does not address whether the Fire Districts had the "right” to recover the fire trucks. The Court has already explained that Plaintiff's argument regarding Article 2 of the UCC is an inappropriate basis for reconsideration, and that, in the alternative, the argument is without merit, because the Fire Districts took constructive possession of the truck chassis. A further layer of "in the alternative” analysis is unnecessary. But the Court notes that at least one court has held that "right” as used in this provision of the UCC can derive either from the common law or from Article 2 of the UCC. See In re Havens Steel,
. Plaintiff separately argues that "the trustee in the Wolverine bankruptcy rejected the contracts between Wolverine and the Fire Districts by not assuming them.” (PL’s Recons. Mem. 6.) In support for this proposition, Plaintiff cites "11 U.S.C. 365,” without further explanation, and, broadly, "ECF history 09-32985 (In re Wolverine Fire Apparatus Co.)." Id. This simply will not do. The Court no more expects to be directed to review an entire case history on ECF for a specific factual proposition than it expects to be directed to review “relevant cases on Westlaw” for a specific legal proposition. If Plaintiff believes there is record evidence supporting the proposition that Wolverine did not assume the sales contracts, it was required to cite a particular document, or portion thereof, from the docket and explain that document’s significance. See Fed.R.Civ.P. 56(c)(1) (directing that a party opposing a motion for summary judgment must cite "particular parts of materials in the record including depositions, documents, electronically stored information, [etc.]” (emphasis added)); see also Lee v. Butts, No. 1 11-CV-2358,