Management Registry, Inc. v. A.W. Companies, Inc.

Background

Management Registry, Inc. and A.W. Companies, Inc., Allan K. Brown, Wendy Brown, and Milan Batinich had been involved in extensive litigation concerning business agreements, an employment agreement, and related claims. An arbitrator awarded Management Registry $1,422,716 in compensatory damages and $18,875 in additional out-of-pocket expenses against Allan K. Brown, with six percent post-judgment interest. The court confirmed the arbitration award and entered judgment, but the judgment mistakenly applied to all defendants rather than only Allan K. Brown.

Management Registry also sought to supplement its pleadings to add a fraudulent-transfer claim under Minnesota law, add Nilan Johnson Lewis as a defendant, and seek prejudgment attachment of assets to help recover the arbitration judgment. Magistrate Judge David T. Shultz denied the request to supplement the pleadings and recommended denying prejudgment attachment. Management Registry objected.

The court had also issued amended summary-judgment orders. The amended order denied Management Registry summary judgment on its breach-of-contract claim against Allan K. Brown and granted the defendants summary judgment on that claim. Management Registry later moved to alter or amend the judgment and sought attorney’s fees.

Rulings

The court granted the defendants’ renewed motion to correct clerical errors. It amended the arbitration order to award Management Registry $1,568,864.69, plus six percent annual interest from December 14, 2022, until paid in full, against Allan K. Brown. It also amended the judgment docket text to state that judgment was in favor of Management Registry against Allan K. Brown.

Because the judgment was corrected, the court denied as moot the defendants’ motion to stay enforcement and motion to expedite.

The court denied Management Registry’s motion to alter, amend, or correct the judgment. It treated the motion as an unauthorized motion to reconsider because it sought to revisit issues already resolved in the amended summary-judgment order. The court stated that Management Registry had not shown the required compelling circumstances or obtained permission to file such a motion.

The court overruled Management Registry’s objections to the magistrate judge’s rulings. It affirmed the order denying leave to supplement the pleadings, concluding that Management Registry had unduly delayed filing the motion and had not shown good cause. The court also adopted the recommendation and denied Management Registry’s motion for prejudgment attachment. The court reasoned that, after denying the request to supplement the pleadings, the proposed attachment based on the claims Management Registry sought to add could not succeed.

The court denied both the defendants’ request for attorney’s fees and Management Registry’s request for attorney’s fees. It concluded that both sides had engaged in conduct that increased the time and resources required to litigate the motions, so neither side would be sanctioned.

Disposition

The renewed motion to correct clerical errors was granted. The arbitration order and judgment were amended to apply the award only against Allan K. Brown. The motions to stay and expedite were denied as moot. Management Registry’s motion to alter, amend, or correct the judgment was denied; its objection was overruled; the magistrate judge’s order was affirmed; the recommendation was adopted; its motion to alter, amend, or supplement the pleadings was denied; and both parties’ requests for attorney’s fees were denied.