Where defendants have filed a motion to amend or correct a judgment entered against them in a dispute over franchise agreements, the motion should not be allowed on the basis of newly discovered evidence or mental health challenges.
“This matter is presently before the Court on a motion to amend or correct the March 14, 2024 Judgment entered against Defendants S & S Pizza Enterprises, Inc. (‘S & S’), Sheryl Claeys, and Suzanne L. Matthews (collectively ‘Defendants’), which Defendants filed on April 11, 2024. Plaintiffs Little Caesar Enterprises, Inc. and LC Trademarks, Inc. oppose the motion. Finding that Defendants fail to meet their burden to demonstrate their entitlement to relief, the Court is denying their motion.
“In support of their motion, Defendants assert that Claeys and Matthews discovered previously misplaced documents during the past several weeks suggesting that Matthews was released and discharged from any obligation as a personal guarantor. Defendants attach these three documents to their motion: two franchise agreements and a document terminating a franchise located in Troy, Michigan. They attach no evidence, however, supporting their assertion that these documents were only recently discovered.
“Defendants further state that ‘Claeys has suffered from various physical and mental health setbacks over the past several years which made it difficult or impossible to present defenses to Plaintiffs’ claims for liquidated damages.’ These alleged setbacks include anxiety and depression, failed suicide attempts, mild restrictive lung disease, a fall from a bicycle due to dizziness, trace leakage of her mitral, tricuspid, and pulmonic valves, scoliosis, osteoarthritis, white matter changes to her brain, complications from physical therapy causing dizziness, vertigo, and ears ringing, adult onset inattentive ADHD, and sleep apnea. Defendants offer no documentation supporting Claeys’ asserted mental and physical issues or their assertion that these conditions interfered with their ability to defend this action.
“Defendants’ documents do not constitute ‘newly discovered’ evidence. They were in Claeys’ and/or Matthews’ possession before the Judgment was entered. And while Defendants assert the documents were ‘misplaced’ notably without a sworn statement or other evidence in support nothing prevented them from requesting the documents from Plaintiffs in discovery. In any event, the documents do not demonstrate that Matthews was released and discharged from the franchise and guarantee agreements at issue in this lawsuit.
“The first two documents are a franchise agreement and guarantee for the Marysville franchise. However, when those agreements expired in 2016, they were replaced with the franchise agreement and guarantee this Court considered when granting partial summary judgment to Plaintiffs, which were signed by Claeys and Matthews. The third document is titled Franchise Termination and Surrender Agreement and Release. Yet, it relates to a different franchisee and a franchise location different than those at issue in this lawsuit.
“With respect to Claeys’ asserted mental and physical challenges, again, Defendants fail to offer an affidavit or other evidence supporting their assertions. And, again, it is their burden to establish a ground for relief ‘by clear and convincing evidence .’ Info-Hold , 538 F.3d at 454 (emphasis added). Nevertheless, those challenges are not new evidence for purposes of Rule 60(b)(2), and they do not support relief under Rule 60(b)(1). Even if the Court looked to Rule 60(b)(6), it would not find that Defendants demonstrate their entitlement to relief. They fail to explain how Claeys’ mental or health challenges prevented Matthews and their counsel from defending this action. Moreover, Defendants fail to explain why these conditions were not brought to the Court’s attention before Judgment was entered against them.”
Little Caesar Enter. Inc. v. S&S Pizza Enter. Inc.; MiLW 02-108006, 10 pages; U.S. District Court for the Eastern District of Michigan; Parker, J.
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