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UNITED STATES DISTRICT COURT EASTERN DISTRICT OF WISCONSIN EDGEWOOD MANOR APARTMENT HOMES LLC, SOUTHLAND MANAGEMENT CORPORATION, Plaintiffs, v. RSUI INDEMNITY COMPANY, Defendant. DECISION AND ORDER DENYING MOTION TO VACATE JUDGMENT (DOC. 100) During a hearing on July 13, 2011, the court granted RSUI Indemnity Company's oral motion to dismiss the claims of both plaintiffs and judgment dismissing the case was entered the same day. Plaintiffs, Edgewood Manor Apartment Homes LLC and Southland Management Corporation, now move to vacate that judgment, arguing that the court erred procedurally and substantively. For the following reasons the motion to vacate will be denied. A motion to vacate, i.e., a motion to alter or amend a judgment under Fed. R. Civ. P. 59(e), is not appropriately used to advance arguments or theories that could and should have been made before the district court entered judgment or to present evidence available earlier. Sigsworth v. City of Aurora, Ill., 487 F.3d 506, 512 (7th Cir. 2007); LB Credit Corp. v. Resolution Trust Corp., 49 F.3d 1263, 1267 (7th Cir. 1995). Instead, the only grounds for a Rule 59(e) motion are newly discovered evidence, an intervening change in the controlling law, or a manifest error of law. Cosgrove v. Bartolotta, 150 F.3d 729, 732 (7th Cir. 1998). The rule enables a district court to correct its errors and to avoid unnecessary appellate procedures. Divane v. Krull Elec. Co., 194 F.3d 845, 848 (7th Cir. 1999). Case No. 08-C-0920

For convenience, the court will use defined terms such as "RSUI Policy," "Property," and "Edgewood LP" in the manner they were used in the court's decision of March 23, 2011, without restating such definitions. In addition, the court uses "RCV proceeds" to describe the repair and replacement cost value insurance proceeds at issue in this case. ALLEGED PROCEDURAL ERROR Plaintiffs first contend that the court erred procedurally. They assert that the hearing was not noticed as one at which dismissal would be discussed, it is unclear what rule RSUI and the court invoked as the basis for dismissal, and RSUI's dismissal motion was oral. None of these reasons are persuasive. Although one unfamiliar with the case could look at the docket and the minutes of the final hearing and question the court's procedure, familiarity with the history of this case would provide ample evidence that plaintiffs had extensive notice of defendant's arguments and the court's concerns such that dismissal was appropriate. The July 13 hearing was set as a "Status/scheduling conference" (Doc. 91 at 1) and one expected topic of discussion was whether the court should refer the case to mediation. However, before RSUI would agree to mediation it wanted evidence of the assignment of RCV proceeds between the two plaintiffs. That had been RSUI's position for months. Counsel for RSUI so indicated at conferences on March 30, 2011, and May 5, 2011, and much of the May 5 conference involved discussion of plaintiffs' failure to produce any evidence of an assignment of the RCV proceeds from Southland to Edgewood Manor. Indeed, the result of the May 5 conference was an order requiring plaintiffs to "provide to RSUI all materials respecting the sale, assignment or transfer of rights or proceeds under

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RSUI's policy relevant to this action and discoverable in this case" (Doc. 96) because plaintiffs had drawn out production of such a document for so long. Standing to sue is part of the Constitution's case-or-controversy requirement. Arizonans for Official English v. Arizona, 520 U.S. 43, 64 (1997). For over a year RSUI had challenged and the court had questioned plaintiffs about their standing and individual entitlement to the RCV proceeds, without satisfactory answers. For instance, in the memorandum supporting its motion for summary judgment, RSUI attacked the standing of Edgewood Manor and Southland. In the introduction to the brief, RSUI wrote: Edgewood is not an insured under the Policy and RSUI has never contracted with Edgewood. Despite being the crux of Edgewood's alleged rights to Southland's RCV proceeds, Plaintiffs have failed to set forth any admissible evidence as to the existence of, or terms of, any sale or transfer of the subject property to Edgewood, and/or any valid assignment of Southland's rights under the Policy. (Doc. 34 at 1-2.) RSUI attacked the standing of Edgewood Manor because nothing in the record established Edgewood Manor's entitlement to the RCV proceeds or Southland's entitlement to the same proceeds because the record then suggested that Southland had sold the property at issue before making the repairs or replacement necessary to trigger RSUI's obligation to reimburse those costs. (Id. at 15-16.) Upon initial review of the cross-motions for summary judgment, the court was concerned with plaintiffs' ability to sue in this case and especially concerned regarding Edgewood Manor's standing. Consequently, a status hearing was scheduled on June 24, 2010, the parties were advised to be prepared to address "whether questions of material fact exist regarding the ownership of said property and the date of any transfer between Southland and Edgewood." (Doc. 74.) At the June 24, 2010, hearing the court questioned

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the plaintiffs about the ownership of the Property and their insurable interests. (See Doc. 78 at 1.) Minutes from the hearing note the court identified three issues, including "standing, which is critical; full info regarding each plaintiff's ability to sue RSUI does not appear to be in the record." (Doc. 78 at 2.) However, rather than proceeding on the existing record, the court gave plaintiffs another chance to provide evidence regarding entitlement to sue for RCV proceeds by supplementing their summary judgment submissions.1 In response to this opportunity, plaintiffs provided the sworn statement of Edward Matkom, General Counsel of Edgewood Manor's managing member, that Edgewood Manor "is the current title owner of the Property, and in accordance with the terms of the sale of the Property Edgewood LLC [i.e., plaintiff Edgewood Manor] has an interest in the proceeds that are the subject of this litigation." (Doc. 81

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