The opinion of the court was delivered by: Wm. R. Wilson, Jr. United States District Judge
Plaintiff Allstate Insurance Company (Allstate) has filed an action for declaratory judgment against defendant Victor Weber (Weber) on a policy of insurance, Policy No. 49 648219 (Policy) to declare it void and exclude coverage for failure to meet a condition of coverage, which required that a sprinkler be in the theater owned by Weber. In particular Allstate seeks to void coverage based upon the Protective Safeguard Endorsement, which excludes coverage for the insured's failure to maintain the required sprinkler system. Weber filed a counterclaim, asserting bad faith and entitlement to punitive damages.
Weber purchased an insurance policy from Allstate in 1996 to insure his theater business. On February 4, 2005, there was a fire at one of Weber's theaters, Lakeland Cinema, which caused substantial damage. Weber made a claim, which Allstate denied.
Allstate filed a motion for summary judgment*fn1 and Weber filed a motion for partial summary judgment.*fn2 Weber contended that the insurance application was completed by Allstate's agent, who signed the insurance application without Weber's approval and consent. He asserted that the signature on the application is not his, and is a forgery.
Thus, he asserted that Allstate has condoned, ratified and adopted the agent's unauthorized conduct; therefore, he argued, the Policy exclusion is void and unenforceable.
Allstate, in its motion for summary judgment, contended that Weber ratified the contract by making payments and receiving the benefits. It alleged that Weber knew that the Policy contained the sprinkler condition because he kept the policy for almost 9 years. An April 18, 2006 Order denied the motions, finding ratification to be a question of fact, and that facts, such as the knowledge possessed by the parties, were in dispute.*fn3 Allstate then filed a motion for partial summary judgment on Weber's claims of bad faith and punitive damages.*fn4 The Court, on October 26, 2006, denied the motion, finding that there was a question of fact as to what Allstate knew with regard to the alleged forgery of Weber's signature on the application.*fn5
Allstate has now filed a motion to reconsider the denial of the motion for partial summary judgment on Weber's claims of bad faith and punitive damages. It has submitted the deposition of Tonya Hawes, a former employee of Clinton Insurance Agency, and the affidavit of Glenn Quinn, an underwriter for Allstate.
Motions to reconsider are governed by Fed. R. Civ. P. 54(b) which provides that in the absence of a final judgment as to one or more but fewer than all of the claims or parties, "any order . . . which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order . . . is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties."
The exact standard applicable to the granting of a motion under Rule 54(b) is not clear, though it is typically held to be less exacting than would be a motion under Federal Rule of Civil Procedure 59(e), which is in turn less exacting than the standards enunciated in Federal Rule of Civil procedure 60(b).
Wells' Dairy, Inc. v. Travelers Indem. Co. of Illinois, 336 F.Supp.2d 906, 909 (N.D. Iowa 2004)(citing cases).
Recently, the district court for the Northern District of Iowa discussed the standard to be applied in a motion to reconsider in Doctor John's, Inc. v. City of Sioux City, Iowa, 456 F. Supp. 2d 1074, 1075 (N.D. Iowa 2006). A court may amend a prior summary judgment ruling to correct any "'clearly' or 'manifestly' erroneous finding of facts or conclusions of law." Id. See also Hagerman v. Yukon Energy Corp. 839 F.2d 407, 414 (8th Cir. 1988) ("Motions for reconsideration serve a limited function: to correct manifest errors of law or fact or to present newly discovered evidence. Such motions cannot in any case be employed as a vehicle to introduce new evidence that could have been ...