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Carlisle 2010 Historic Tax Credit Fund II Limited Partnership v. Regions Bank

United States District Court, S.D. Mississippi, Northern Division

September 25, 2018

CARLISLE 2010 HISTORIC TAX CREDIT FUND II LIMITED PARTNERSHIP PLAINTIFF
v.
REGIONS BANK DEFENDANT

          ORDER

          DANIEL P. JORDAN III CHIEF UNITED STATES DISTRICT JUDGE

         On September 11, 2017, the Court granted Defendant Regions Bank's Motion for Summary Judgment in this fraud case, finding Plaintiff Carlisle 2010 Historic Tax Credit Fund II Limited Partnership's claims time-barred. Order [60]. Carlisle now asks the Court to reconsider its ruling and set its claims for a jury trial. Because Carlisle's motion raises new arguments not properly made on a motion for reconsideration, Carlisle's Motion for Reconsideration [62] is denied.

         I. Facts and Procedural History

         The facts of the case are more fully set out in the Court's Order [60] granting Regions' Motion for Summary Judgment. Relevant here, in 2010, Carlisle agreed to help fund the Dickies Building project in Jackson, Mississippi, in exchange for certain tax credits the building would receive. At the same time, following an initial loan of $2 million, Regions provided a written commitment letter to the owner of the Dickies Building for a modified loan of up to $2.4 million to help complete renovations. “Regions considered Carlisle's involvement as a tax-credit investor part of the plan to get the Dickies Building project completed. Regions also understood that Carlisle's participation in the project depended on Regions' commitment of an additional $400, 000 to the project.” Order [60] at 2-3.

         Regions never advanced any additional money toward the project, and “the evidence- when viewed in [the] light most favorable to Carlisle-suggests that Regions never intended to fund the loan.” Id. at 7. That said, Carlisle first became aware of Regions' refusal to fund the loan no later than 2012. See Pl.'s Resp. [47] ¶ 45 (“Carlisle does not dispute that at some point in 2011 or 2012, it was learned from [a Dickies Building owner] that Regions was refusing to advance any funds on the modified loan.”). On that basis, and because it concluded Carlisle had not offered proof to create a question of fact on either element of the fraudulent-concealment test, the Court ruled that Carlisle's fraud claims-filed in June 2016-were time-barred. Carlisle now asks the Court to reconsider that decision, asserting “that the Court committed plain error by misapplying Mississippi law and failing to construe the evidence in a light most favorable to Carlisle.” Pl.'s Mem. [63] at 1-2. The Court held a hearing on the motion on May 15, 2018, and invited limited supplemental briefing.

         II. Standard

         Carlisle filed its motion under Federal Rule of Civil Procedure 59(e), which provides for a motion “to alter or amend a judgment.” Fed.R.Civ.P. 59(e). “A Rule 59(e) motion ‘calls into question the correctness of a judgment.'” Templet v. HydroChem Inc., 367 F.3d 473, 478 (5th Cir. 2004) (quoting In re Transtexas Gas Corp., 303 F.3d 571, 581 (5th Cir. 2002)). “[S]uch a motion is not the proper vehicle for rehashing evidence, legal theories, or arguments that could have been offered or raised before the entry of judgment.” Id. at 479. “Rather, Rule 59(e) serve[s] the narrow purpose of allowing a party to correct manifest errors of law or fact or to present newly discovered evidence.” Id. (citation and quotation marks omitted). “Reconsideration of a judgment after its entry is an extraordinary remedy that should be used sparingly.” Id. When faced with a motion to reconsider, the Court must “strike the proper balance between [two] competing interests”: “1) the need to bring litigation to an end; and 2) the need to render just decisions on the basis of all the facts.” Id. (citing Lavespere v. Niagra Mach. & Tool Works, Inc., 910 F.2d 167, 174 (5th Cir. 1990), overruled on other grounds by Little v. Liquid Air Corp., 37 F.3d 1068 (5th Cir. 1994)).

         III. Analysis

         The thrust of Carlisle's motion for reconsideration is that the Court got it wrong when it concluded that Carlisle's claims were time-barred. To put Carlisle's current arguments in context, the Court reviewed Regions' summary-judgment motion and Carlisle's response.

         In that original motion, Regions argued that the June 2016 Complaint was time barred because “[t]he undisputed facts show that Carlisle knew or should have known of its alleged claims as early as 2011 and no later than 2012.” Def.'s Mem. [43] at 2. Regions also said there was no evidence of fraudulent concealment and urged the Court to dismiss the suit. Id. at 9-10.

         Carlisle responded to Regions' time-bar argument with the following four-paragraph argument:

Regions argues that Carlisle's claims are time barred by the three (3) year statute of limitations set forth in Miss. Code Ann. § 15-1-49. Regions argues that Carlisle's claims accrued in 2011 or 2012 when Carlisle became aware that Regions was refusing to advance additional funds on the Modified loan and had to be asserted in 2015 at the latest. The Court should reject this argument because there are genuine issues of material fact as to when Carlisle's claims accrued and whether Regions' fraudulent concealment tolls the statute of limitations per Miss. Code Ann. § 15-1-67.
Under Mississippi law, the statute of limitations on a fraudulently concealed cause of action is tolled until discovery. See Miss. Code Ann. § 15-1-67. Here, Regions fraudulently misrepresented that it was committing “new money” to this project, when in fact the bank had placed an undisclosed “no funding” restriction on the Modified loan to ensure that no additional funds would be advanced. This undisclosed restriction was buried deep within Regions' internal loan documents and concealed from Carlisle.
Although Carlisle was generally aware that Regions had not advanced any additional loan proceeds by 2012, neither Carlisle (nor [its business partner Oscar] Deleon) knew the real reason for this until Regions' internal documents came to light in August, 2015 in [another legal action]. Carlisle certainly did not know and could not have discovered through ordinary diligence that Regions' actual intentions were the exact opposite of its representations. Regions does not explain how Carlisle could have possibly discovered Regions' true intentions at some earlier point in time. In fact, Regions is still perpetrating the deception by maintaining that, despite what its loan history reveals, it would have honored its commitment but for the fact that Deleon did not submit a “proper” draw request and the loan was in default. Although the fraud became apparent after Regions' ...

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