MAYAGUEZ MEDICAL CENTER DR RAMON E BETANCES INC v. MEDICAL EDUCATIONAL AND HEALTH SERVICES INC

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IN THE UNITED STATES BANKRUPTCY COURT FOR
THE DISTRICT OF PUERTO RICO
IN RE:
MEDICAL EDUCATION AND HEALTH
SERVICES, INC. 	CASE NO. 10-04905 BKT
DEBTOR
Chapter 11
MEDICAL EDUCATIONAL AND HEALTH
SERVICES, INC.
PLAINTIFF 	ADV. NO. 10-202
VS.
SISTEMAS INTEGRADOS DE SALUD DEL
NOROESTE & MAYAGUEZ MEDICAL CENTER-
DR. RAMON EMETERIO BETANCES, INC.
DEFENDANTS
FILED & ENTERED ON 03/04/2011
OPINION AND ORDER
This 	proceeding 	is 	before 	the 	Court 	upon 	Defendants’ 	motion 	for
reconsideration of the order remanding the lawsuit to the Commonwealth of Puerto
Rico's Court of First Instance, Superior Court of Mayaguez [Dkt. No. 32], and the
Plaintiff’s Opposition to the Defendants’ motion for reconsideration [Dkt. No.
33]. 	For the reasons set forth below, the Defendants’ motion for reconsideration
is hereby denied.
I. PROCEDURAL BACKGROUND
On February 10, 2011, this Court entered an order remanding the cause of
action brought under the present adversary proceeding to the Commonwealth of
Puerto Rico’s Court of First Instance, Superior Court of Mayaguez, finding that
all of the factors for mandatory abstention under 28 U.S.C. § 1334(c)(2) apply to
the present controversy. 	Under § 1334(c)(2), in order for mandatory abstention
to apply, the proceeding must: 1) be based on a State law claim or cause of
action; 2) lack a federal jurisdictional basis absent the bankruptcy; 3) be
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commenced in a state forum of appropriate jurisdiction; 4) be capable of timely
adjudication; and 5) be a non-core proceeding. 	The Court found that the present
action is a non-core proceeding that stems from Commonwealth law, lacks a federal
jurisdictional basis outside of bankruptcy, and in the absence of bankruptcy,
could be timely resolved in the state court where it was commenced. 	On February
16, 2010, the Defendants filed a motion to reconsider, arguing that the Court
incurred in a manifest error of law by remanding the case to state court, since a
substantially similar controversy had been heard and decided by this Court in
another adversary proceeding (Case No. 10-0159).
This Court has jurisdiction of the subject matter and the parties pursuant
to 28 U.S.C. §§ 1334 and 157(a) and the General Order of referral of Title 11
Proceedings to the United States Bankruptcy Court for the District of Puerto Rico
dated 	July 	19, 	1984 	(Torruella, 	C.J.). 	This 	is 	a 	non-core 	proceeding 	in
accordance with 28 U.S.C. §157(b).
II. STANDARD OF REVIEW
In seeking reconsideration, “the moving party must either clearly establish
a manifest error of law or must present newly discovered evidence.” Marie v.
Allied Home Mortgage Corp., 402 F.3d 1, 7 n.2 (1st Cir. 2005) (quoting Pomerleau
v. W. Springfield Pub. Sch., 362 F.3d 143, 146 n.2 (1st Cir. 2004)). The First
Circuit in Marie also cited a leading treatise, highlighting the following four
grounds for granting a motion for reconsideration under Fed. R. Bankr. Pro.
59(e): (1) manifest errors of law and fact; (2) newly discovered or previously
unavailable evidence; (3) manifest injustice; and, (4) an intervening change in
controlling law. 	402 F.3d at 7 (citing 11 C. Wright et al., Federal Practice &
Procedure § 2810.1 (2d ed. 1995)). 	Under Rule 59, reconsideration of a judgment
is an extraordinary remedy, which is used sparingly and only when the need for
justice outweighs the interests set forth by a final judgment. 	The underlying
policy of reconsideration is to provide a court with a means to correct its own
errors. 	White v. New Hampshire Dept. of Employment Sec., 455 U.S. 445, 450
(1982). 	Conversely, Rule 59(e) does not exist to allow parties a second chance
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to prevail on the merits. 	Harley-Davidson Motor Co. v. Bank of New England-Old
Colony, N.A., 897 F.2d 611, 616 (1st Cir. 1990). 	Indeed, Rule 59(e) is not an
avenue for litigants to reassert arguments and theories that were previously
rejected by the Court. 	Id. at 616 (citing FDIC v. Meyer, 781 F.2d 1260, 1268
(7th Cir. 1986)). 	As the First Circuit noted in Harley-Davidson Motor, the rule
is “aimed at reconsideration, not initial consideration.” 	Id. at 616. (citing
New Hampshire Dept. of Employment Sec., 455 U.S. at 450). 	See also, Nat’l Metal
Finishing Co. v. BarclaysAmerican/Commercial, Inc., 899 F.2d 119, 123 (1st Cir.
1999) (Rule 59(e) does not allow losing party to rehash old arguments, previously
considered and rejected).
III. DISCUSSION
Defendants 	pray 	for 	reconsideration 	pursuant 	to 	Plumley 	v. 	Southern
Container, Inc., 303 F.3d 364, 373 (1st Cir. 2002), which held that a party is
precluded from re-litigating an issue that was previously litigated, if: “(1) the
issue to be precluded is the same as that disputed in a prior proceeding, (2) the
issue 	was 	actually 	litigated 	in 	the 	earlier 	proceeding, 	(3) 	the 	issue 	was
determined 	by 	a 	valid 	and 	binding 	final 	judgment 	or 	order, 	and 	(4) 	the
determination of the issue in the prior proceeding was essential to the final
judgment or order.” 	The Defendants contend that the decision in Plumley requires
this Court to resolve the present controversy because the issue to be determined
is the same as that disputed in a prior proceeding. 	However, the Plaintiff in
the case to which the Defendants refer (Case No. 10-0159) only moved for relief
pursuant to Fed. R. Bankr. P. 7065 and 11 U.S.C. § 105. 	In the case at bar, the
Plaintiff moves for a “possessory injunction” under section 690 of the Puerto
Rico Code of Civil Procedure, 32 L.P.R.A. § 3561.
A 	cursory 	search 	reveals 	that 	32 	L.P.R.A. 	§ 	3561 	was 	enacted 	by 	the
Legislative Assembly of Puerto Rico to promote a compelling policy consideration.
The purpose of the injunction contemplated by this section is to provide the
possessor 	with 	a 	rapid 	and 	efficacious 	remedy 	to 	protect 	his 	possession,
discouraging citizens from resorting to force and violence in view of the threats
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of dispossession or the consummated dispossession. Disdier Pacheco v. Garcia, 101
D.P.R. 541, 549-50 (1973) (emphasis added). 	Furthermore, federal courts have
recognized that “[a] territorial sovereign has a primeval interest in resolving
all disputes over use or right to use of real property within its own domain.”
Asociacion de Reclamantes v. United Mexican States, 735 F.2d 1517, 1521 (D.C.Cir.
1984). While Puerto Rico may fall under the sovereignty of the United States,
this Court finds the same rationale applicable to the present controversy. 	The
Commonwealth 	Courts 	of 	Puerto 	Rico 	have 	a 	compelling 	interest 	in 	resolving
disputes regarding possession of Puerto Rican land, especially if the Legislative
Assembly of Puerto Rico is concerned with the possibility of citizens resorting
to force and violence as a result of, or in contemplation of, dispossession of
real property.
Having found that the claims brought by the Plaintiff in Case No. 10-0159
are sufficiently distinct from the claim brought in the present controversy,
Plumley is inapplicable to the extent that it would prevent the parties from re-
litigating an issue already decided by this Court. 	It strikes the Court as
unnecessary to re-enter a discussion of the arguments advanced by the Defendants
that were already rejected in the analysis that resulted in the order remanding
the 	case 	[Dkt. 	No. 	28]. 	Because 	the 	Defendants 	have 	failed 	to 	establish 	a
manifest error of law, this Court finds that the Defendants are not entitled to
reconsideration under Federal Rules of Bankruptcy Procedure, Rule 9023.
WHEREFORE, IT IS ORDERED that DEFENDANT’s motion for reconsideration shall
be, and it hereby is, DENIED.
San Juan, Puerto Rico this 04 day of March, 2011.
Brian K. Tester
U.S. Bankruptcy Judge
CC: 	ALL CREDITORS
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