NOT RECOMMENDED FOR FULL- TEXT P UBLICA TION File Name: 12 a12 56n. 06
No. 11 -583 1 UNITED STA

TES COURT OF A PPE A LS FOR THE SIX TH CIRCUIT

MADISON CAP IT AL COMPANY, LLC, Plaint if f -Appe llant,

v

. S & S SAL VAGE , LLC, and RI VER MET ALS RECYCLING, LL C, Def end ant s-Appe llees. ) ) ) ) ) ) ) ) ) ) ) ON APP EAL FROM T HE UNIT ED ST AT ES DIST RICT COURT FOR T HE W EST ERN DIST RICT OF KE NTUCKY

Bef ore: MART IN an d DAUGHT REY, Cir cuit Ju dges; MAL ONEY, District Judge. *

MARTHA CRAIG DAUGHTRE Y, Circuit Judge. T his app eal arises f rom an action brou ght by plaint if

f Madison Capita l Com pan y , LLC, base d on diversi ty jurisdiction, against def end ant s S & S Salvage, LLC, and Riv er Metals Recycl ing, LLC, on claims of conversion of pe rsona l prop erty, trespass against p erson al pro perty, and w rongf ul w ithho lding. T he plaint if f now a ppe als the district court’s den ial o f a m o tion to alter, am end , or v acat e the court’s origi nal orde r of sum ma ry judgme nt in f avor o f the def end ant s on the conversion claim and the court’s later sua spon te gr ant of su m m a ry ju d gm ent in f avor of the def end ant s on the claims of trespa ss and w rongf ul w ithho lding. T he plaint if f also alleges

T h e H o n

. P a u l L

. M a l o n e y , C h i e f U n i t e d S t a t e s D i s t r i c t J u d g e f o r t h e W e s t e r n D i s t r i c t o f M i c h i g a n , *
s i t t i n g b y d e s i g n a t i o n

.No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage

error in t he district court’s rulings on app lication of the statu te of limitat ions and the exclusion of

expert te stimo ny. W e f ind n o reversible error a nd af f irm.

FA CTUA L A ND PROCEDURA L BA CKGROUND

I n F e b ru ary 200 5, Com mu nity T rust Ban k ent ered into a loan agreem ent w ith
T im o thy P. Sm ith and w ith three min ing com pan ies owned by Sm ith. Pursua nt to t h a t
agreem ent , Sm ith received $1, 500 ,00 0 to f inan ce com pletio n of a coal plan t and to pay of f existing deb t, and ano the r $35 0,0 00 “to supp ort w orking capita l nee ds.” T o secure the loan s, Sm ith pled ged as collate ral mu ch of the equipm ent and f ix ed asset s of the

com pan ies , in cluding a Joy Lon gw all Mining System tha t w as com prised, in part, of 85 Hem scheid t sh ields – large, me tal, und erground roof supp orts each w eighing
app rox ima tely 15 ton s. T he partie s d o n o t d is p ute tha t the ban k prop erly recorde d and perf ecte d its se curityinte rest in tha t collat eral.

Less tha n f iv e w eeks af ter obt aining the loan f rom Com mu nity T rust, Sm ith sought
perm ission f rom Brett Kee ne, a com me rcial loan of f icer at the ban k, to sell portio ns of the
min ing e quipme nt to C.W

. Mining, a min ing co mp any loca t e d in Utah. T he ban k den ied the request and inf orme d Sm ith of tha t f act. Sm ith later insisted , howev er, tha t he received

n o such inf orma tion f rom the ban k and tha t he thu s consu mm ate d the sale o f m in in g equipm ent , min us the Hem scheid t shields, to the Utah conce rn

. Furthe rmore , Sm ith claime d, the payme nts f rom the Utah com pan y we re e v ent ually transf erred f rom tha t

com pan y into Sm ith’s accou nts at Com mu nity T rust Ban k, indicat ing tha t the ban k w as - 2 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage aware, or at least sho uld h ave bee n aware, tha t th e co llateral se curing the loan s w as n o longer w ithin S mith ’s posse ssion.

At the sam e time , Sm ith w as seekin g to iden tif y a purch aser f or the 85 Hem scheid t shields beca use tho se piece s of equipm ent w ere bein g s t o re d on a 20-a cre lot tha t had bee n transf erred to a subsid iary of the Pea bod y Coal Com pan y tha t w ant ed the ma chine ry

remo v ed. A suitab le p u rc h a ser could not be locate d, howev er, and Sm ith eventua lly agreed t o s e ll t h e shields f or the ir scrap-m eta l v alue

. Even tho ugh Sm ith did not recall discussing the sale of the shields/ collate ral w ith anyone at Com mu nity T rust, he eventua lly did cont ract w ith S & S Salvage to have tha t com pan y hau l the 85 shields f rom the prop erty and transp ort the m to Riv er Metals Recycl ing to be scrapp ed. Once Riv er Metals received the shields, it cut the ma chine ry into piece s of me tal sma ller tha n tw o-f eet by f our-f eet by six -inches and shipp e d t h e s c ra p me tal by b arge to Nucor Ste el Com pan y in Cincinna ti, thu s ef f ectively de stroyi ng the shield s as u sable m ining equipm ent

.
Once Riv er Metals paid S & S Salvage f or delivering the ma chine s, S & S Salvage
cut a check dat ed Decem ber 27, 200 5, to T imo thy P. Sm ith f or “(American Mining) scrap shields” in the am oun t of $87 ,41 7.8 0 and a Decem ber 31 check to Am erican Mining in the

am oun t of $96 ,99 2

. 8 5

. E ve n tho ugh tho se checks w ere the n dep osited into Sm ith’s

accou nt or the accou nts set up f or Sm ith’s com pan ies at Com mu nity T rust, no one at the ban k mo nitore d any of the accou nts or oth erw ise question ed the w ire transf ers com ing into

or ou t of the m.

- 3 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage Unf ortun ate ly , Smith’s sale o f the collate ral securing his loan s did little to allev iate the f inan cial burd ens he and his com pan ies w ere experiencing. As a result, as state d by the district court in one of its me mo rand um or d e rs is s u ed during the pen den cy of this litig ation :
[T ]he Sm ith com pan ies too k on a n e w in v esto r in Plaint if f Madison Capita l Com pan y , LLC ( “Madison”). Madison and the Sm ith com pan ies eventua lly f orme d Am erican Mining & Manu f actu ring LLC (“AMM , LLC”) in June 200 6. AMM, LLC assum ed the deb t f rom the earlier [Com mu nity T rust] loan s to the Sm ith com pan ies and def aulte d on tha t deb t som etim e in July 2006 . A f ter the def ault, [Com mu nity T rust] c a t a logued the collate ral in the f ield and learne d tha t several piece s w ere missing, inclu d in g the Shie lds. In Sep tem ber 200 6, Madison purch ased [Com mu nity T rust’s] positio n as a secure d cred itor of

the Sm ith co mp anie s by w ay of an assignm ent

.
Madison Capita l Co., LLC v. S & S Salva ge, LLC (Madison II) , 794 F. Sup p.2 d 735 , 737 (W .D. Ky. 20 11).

Eventua lly , on Novembe r 10, 200 8, Madison Capita l f iled suit aga inst S & S Salvage, alleging tha t S & S Salvage imp rope rly converted to its own use prop erty to w hich Madison Capita l had a su perior claim as the assignee of Com mu nity T rust Ban k. T hree

mo nth s later, on Februa ry 13, 200 9, the plaint if f f iled an am end ed com plaint , add ing Riv er Metals as a def end ant and alleging claims against each of the t wo d e f e n d ant s f or conversion, w r on g ful w i th ho l di ng , tr es pa s s to pe r s on al prope rty , const ructiv e trust, replevin, and negligence. F o ll o win g a period of discovery , the partie s f iled cross-mo tions f or

sum ma ry judgme nt. Madison Capita l initially sought judgme nt in its f avor only on its claims

- 4 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage of conversion and negligence; the def end ant s requeste d sum ma ry judgme nt in the ir f avor

on all claim s asse rted by the p laintif f

.
On Janu ary 19, 201 1, the district court issue d a me mo rand um opin ion and orde r tha t den ied Madison Capi t a l’ s mo tion f or sum ma ry judgme nt in its ent irety

. Madison Capita l Co., LLC v. S & S Salva ge, LLC (Madison I) , 765 F. Sup p.2 d 923 (W .D. Ky. 201 1).
T he district court gr ant ed the mo tions of the d e f e n d a n t s a s the y relate d to the claims of conversion, negligence, replevin, and const ructiv e tru s t. T he court den ied sum ma ry judgme nt to t h e def end ant s, howev er, on the plaint if f ’s cause s of action f or trespa ss to
perso nal prop erty and w rongf ul w ithho lding. Id. Madison Capita l the n f iled a time ly mo tion
to alter, am end , or v acat e portio ns of tha t decision , spe cif ically see king reinstat em ent of the conv ersion claim. On June 15, 2011 , the district court den ied the plaintif f ’s mo tion in f ull and also used tha t opp ortun ity to rule, sua spon te , tha t the def end ant s “are ent itled to

sum ma ry judgme nt as to Plaint if f Madison ’s rema ining trespa ss and w rongf ul w ithho lding claims

. . . .” Madison II , 794 F. Sup p.2 d at 743

. W ithin the requisite 30-d ay period, the plaint if f f iled a not ice of app eal specif y ing tha t it sought rev iew of only “the Memo rand um Opinio n and Order [Doc. 132 ] ent ered in this action on the 15t h day of June , 201 1 (the f inal judgme nt) (f rom an orde r (describing it)).” Conse quently, the only issues iden tif ied by the plaint if f t h a t are prop erly bef ore us on app eal are Madison Capita l’s challen ges to the district court’s rulings regarding the conversion, trespa ss, and w rongf ul-w ithho lding claims.

DISCUSSIO N

- 5 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage Giv en the nat ure of the district court’s June 15, 201 1, me mo rand um opin ion and the limited scope of the rev iew sought by Madison Capita l, our ana ly sis of the issues mu st be f iltered throu gh tw o sepa rate lense s. Beca use the plaint if f ’s challen ge to the dism issal of its claim of conversion now p re s e n t s itself only as an atte mp t to overturn a den ial of a

mo tion to alter, am end , or v acat e a prior judgme nt, w e w ill examine the record to det ermin e

w het her t he district cou rt ab used its con siderab le discretion in den y ing tha t motio n. See
Leisu re Caviar, LLC v. U.S. Fish and W ildlife Serv. , 616 F.3d 612 , 615 (6th Cir. 201 0). T he

re m a in in g ch allenges tha t seek rev ersal or mo dif ication of initial decision s regarding t he trespa ss an d wr ongf ul-w ithho lding claims are subje ct to the traditio nal de novo stan dard of revi ew. See Cim inillo v. S treiche r , 43 4 F.3 d 4 61, 46 4 (6t h Cir. 20 06).

Furthe rmore , be cause this case com es bef ore the court pursu ant to the diversity

jurisdiction provisi ons of 28 U.S.C. § 133 2(a), state la w go verns the subst ant iv e issues
prese nte d. See , e.g

. , Gass v. Marriot Hotel Servs., Inc. , 558 F.3d 419 , 425 (6th Cir. 200 9).
Fede ral law , ho w ever, gov erns a ll proced ural issue s, “includ ing evi den tiaryrulings ma de
pursu ant to the Fede ral Rules of Evi den ce.” V & M Sta r Ste el v. Centimark Corp. , 678 F.3d 459 , 46 5 (6t h Cir. 20 12).

Claim of Conv ers ion

In its com plaint , Madison Capita l, as a secure d credito r of T im o t h y P

. Sm ith and Sm ith’s min ing com pan ies, alleged conversion cause s of action against bot h S & S Salvage and Riv er Metals. Accordin g to the p la in tif f ’s allegation s, Sm ith sold the me tal - 6 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage shields f or scrap throu gh busin ess dea lings w ith the tw o def end ant s. Beca use tho se sales

w ere not aut horized by Com mu nity T rust Ban k, the p la in tif f ’s assignor, and beca use the shields had bee n pled ged by Sm ith as collate ral f or loan s he received, t h e p la in tif f
cont end ed tha t the def end ant s imp rope rly converted the prop erty to the ir own use and thu s

w ere liable to M adiso n Capital fo r the plaintif f ’s loss of

use of those pieces of

machin ery

.

T o esta blish the tort o f c o n ve rsion in Ken tucky, the plaint if f bea rs the burd en of proving tha t:
(1) the plaint if

f had legal title to the converted prop erty; (2) the plaint if f had p o s s e ssion of the prop erty or the rig ht to posse ss it at the time o f t h e conversion; (3) the d e f e n dan t exercised dom inion over the prop erty in a ma nne r w hich den ied the plaint if f ’s rig hts to use and enjo y the prop erty and w hich w as to the def end ant ’s own use and ben ef icial enjo y me nt; (4) the def end ant inten ded to interf ere w ith the plaint if f ’s posse ssion; (5) the plaint if f ma de som e dem and for the prop erty’ s r etu rn w hich the def end ant r ef used ; (6) the def end ant ’s act w as the legal cause of the plaint if f ’s lo ss of the prop erty; and (7) the plain tif f suf f ered da ma ge by the lo ss of the prop erty.

Mead e v. Richardso n Fuel, Inc. , 166 S.W .3d 55, 58 (Ky

. Ct. App

. 200 5). T he district court did not engage in an ana ly sis of t h e e le me nts of the tort of conversion in this case, howev er, beca use of its det ermin ation tha t Madison Capita l f ailed to initiate its suit w ithin
tw o ye a rs of the time the assignor or the assignee shou ld have known of the remo v al of the ma chine s by the def end ant s. T he district court thu s gr ant ed sum ma ry judgme nt to the def end ant s on the con v ersion claim beca use it w as u ntim ely.

- 7 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage In arguing tha t the district court abu sed its discretion in ref using to alter, am end , or

v acat e tha t decision , Madison Capita l asserts tha t the district judge errone ously app lied a tw o-y ear, rathe r tha n a f iv e-y ear, statu te of limitat ions to the plaint if f ’s conversion cla im.
T his po rtion o f

the plain tif

f ’s argume nt is p ate ntly w ithou t m erit.

It is true tha t prior to July 15, 198 8, Ken tucky statu tory law provided tha t “[a]n action f or the taking, det aining or injuring o f p e rs ona l prop erty, includin g an action f or specif ic
recovery ,” could be com me nced at any time w ithin five years a f t e r t h e c a u se of action

accrue d. Ky. Rev. Sta t. § 413 .12 0(6) (198 5). In 198 8, howev er, the Ken tucky legislature dele ted subp aragraph 6 f rom section 413 .12 0 and ena cted a new section 413 .12 5, w hich

now provides tha t “[a]n action f o r t h e t a k in g, det aining or injuring of perso nal prop erty, includin g an action f or specif ic recovery shall be com me nced with in tw o (2) years f rom the time the cau se o f

actio n a ccrued .” Ky. Rev. Stat. § 4 13. 125 (198 8) (em pha sis add ed).

T he relevant Ken tucky statu te thu s provides in plain languag e t h a t c la ims of conversion mu st now be initiate d w ithin tw o y ears of the accrua l of the cause of action

. Madison Capita l disingenu ously argues, howev er, tha t the cases to w hich the district court cited to supp ort its decision , Rich & Rich Partn ership v. Poe tm an Records USA, Inc. , 714
F. Sup p.2 d 657 , 669 (E.D. Ky. 201 0), and Tritschler v. Haire , No. 5:0 7-43 7-JMH, 200 9 W L 151 576 3, at *4 (E.D. Ky. Ju ne 1, 200 9), w ere f ede ral c a s e s , n o t c ases origi nat ing in the
state courts of Ken tucky, and thu s cann ot overrule cont rary Ken tucky court decision s. T he plaint if f the n cites three cases f rom Ken tucky’s highest state court, Ken tucky-W est Virginia

- 8 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage Gas Co. v. B urche tt , 402 S.W .2d 421 (Ky

. 196 6), Eline v. Com m ercial Credit Corp. , 209 S.W .2d 846 (Ky

. 194 8), and Pat t o n v. Coldiron , 281 S.W

. 812 (Ky

. 192 6), to but tress its
argume nt tha t the f iv e-y ear statu te-of -limitation s period still app lies in Ken tucky conversion action s. Qu ite o bviously , ho w ever, each of the cases cited by Madison Capita l pred ate s the legislativ e chan ge in the app licable Ken tucky statu tes and thu s is no longer in conce rt

w ith th e clea rly -ex presse d int ent of the Ke ntu cky

legislature.

Madison C apita l ma intain s that ev en if the tw o-y ear statu te of limitat ions is held to
app ly to conversion cause s of action in Ken tucky, it f iled its com plaint against the def end ant s w ithin tha t app licable time period

. In supp ort of tha t argume nt, Madison Capita l
cont end s tha t bot h a dem and f or return of converted prop erty and a ref usal of tha t dem and are elem ent s of the tort of con v ersion. T hus, if

the plain tif

f f iled its com plaint ag ainst the def end ant s w ithin tw o y ears of its dem and f or return of the shields, its conversion claim

w ould surv iv e in the f ace of any timin g challen ge. Beca use Madison Capita l ma intain s tha t its initial dem and lette r to S & S Salvage w as not sent unt il July 11, 200 8, and its dem and lette r to Riv er Metals not unt il Janu ary 14, 200 9, the plaint if f asserts tha t its com plai nts against the def end ant s f iled on Novembe r 10, 200 8, and Februa ry 13, 200 9, respe ctiv ely,

w ere well w ithin e v en a two-y ear lim itation pe riod.

T he Ken tucky Court of App eals discou nte d exactly such an argume nt a cent ury ago, howev er. In Josep h Goldb erge r Iron Co. v. Cincinna ti Iron & Ste el Co. , 154 S.W

. 374 , 375 (Ky . 19 13), the court recogniz ed “that w here an actual conversion i s alleg ed, as here , an

- 9 -No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage

avermen t of dem and and ref usal is not required” beca use even tho ugh such a dem and and ref usal can be evidence of a conversion, “any w rongf ul exercise or dom inion over chat tels
to the exclusion of the rig hts of the o wn e r, o r a wit hho lding of the m f rom his posse ssion und er a claim incon sistent w ith his rig hts, const itute s a c o n version. ” Sta ted som ewhat dif f eren tly :

T he rig ht of action [f or conversion] accrue s in f avor of the owner of goods as soon as the y are w rongf ully take n f rom the owner’s posse ssion or oth erw ise w rongf ully converted

. . . . W here the initial posse ssion is law f ul, the statu te d o e s n o t com me nce to run w hile the relation of the partie s cont inue s unch anged and unre pud iated

. If the hold ing or poss e s s io n s o und s in tort from the beg inning , a demand and refusa l are unn ecessa ry for the purp ose of det erm ining wh en the statu te of li mit a tions beg ins to run and , once the statu te beg ins to run, no subse que nt demand and refusa l can start it afresh

.
90 C.J.S, Trover an d Con version § 5 5 (20 12) (f oot not es o mitt ed) (em pha sis add ed).

T hus, the lack of a d e m a n d f or return of the collate ral unt il July 200 8 in no w ay af f ecte d the star t o f t h e statu te-of -limitation s period in this case. Moreover, f or practica l

reaso ns also, ado ption of the plaint if f ’s positio n on this issue w ould be coun terprod uctive. As not ed b y d e f e n d a n t Riv er Metals in its brief , “If Madison ’s positio n is take n as true, Madison could w ait inde f initely to bring its conversion claim desp ite its knowledge [tha t] the Shie lds w ere sold

. . . b e c a u s e it had not issued a dem and f or the return and had not received a re f u s a l. ” T he district court, the ref ore, did not abu se its discretion by ref using
to reinsta te the plaint if

f ’s conversion cause of action on the g roun ds [tha t]b the statu te of

- 10

-No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage limitat ions did not begin to run unt il Madison Capita l ma de its w ritten dem and f or return of the collate ral on July 11, 2 008

.

In a f inal ef

f ort to avoid dism issal of its conversion claim on time liness gr oun ds, the plaint if f asserts tha t it did not discover tha t a possib le conversion had occurred unt il 200 8 and tha t the limitat ions peri o d f o r t h e f iling of suit did not begin unt il tha t dat e. Madison Capita l thu s cont end s tha t its Novembe r 200 8 com plaint and its Februa ry 200 9 am end ed

com plaint w ere f iled w ell w ithin e v en a two-y ear st atu te-of -limitation s pe riod. At t he v ery least, the plaint if

f argues, by ma king tha t allegation , it has iden tif ied a ma terial issue of f act

conce rning the dat e of discovery of the tort tha t shou ld have preclud ed t h e district court f rom gr ant ing sum ma ry judgm ent to the de f end ant s on the con v ersion claim.

T hat assertio n by the plaint if f r aises the question , how ever, w het her the discovery rule app lies at al l in K e n t u cky to claims of conversion of perso nal prop erty. T he district
court discusse d and app lied the discovery rule in its opin ions gr ant ing sum ma ry judgme nt
to the def end ant s on the conve rsio n claim and den y ing the plaint if f ’s mo tion to alter,

am end , or v acat e tha t det ermin ation

. See Madison I , 765 F. Sup p.2 d at 932 -33; Madison
II , 794 F. Sup p.2 d at 738 -40. On app eal, howev er, the def end ant s arg ue tha t the district
court actu ally misa pplied the law of Kentu cky

i n intima ting tha t f iling of the com plaint and the am end ed com plaint w ithin tw o y ears of the discove ry of the sale of the shields, rathe r tha n w ithin tw o y ears of t h e a c t u a l sale of the shields, w ould have allowed Madison

- 11

-No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage Capita l’s conversion claim to proce ed. T he def end ant s are correct in the ir assertio n in this regard.

T h e Ken tucky Sup reme Court has det ermin ed tha t “[a] cause of action w ill n o t

accrue und er the discovery rule unt il the plaint if f discovers or in the exercise of reaso nab le diligence shou ld have discovered not only tha t he has bee n injured but also tha t his injury

ma y have bee n cause d by the def end ant ’s cond uct.” Lou isville Trust Co. v. John s-Manville Prods. Corp. , 580 S.W .2d 497 , 501 (Ky

. 197 9). T hat discovery rule, howev er, “is available only in cases w here the f act of injury or of f end ing instrum ent ality is not imm edia tely evident

or discoverable w ith the exercise of reaso nab le diligence, s u c h a s in cases of me dical

m alpract ice or laten t injuries or illnesses.” Fluke Corp. v. LeMa ster , 306 S

. W

. 3 d 5 5 , 6 0 (K y

. 201 0) (f oot not e om itted ). In f act, in Rockw ell Inte rnatio nal Corp. v. W ilhite , 14 3 S.W .3d 604 , 613 (Ky

. Ct. App

. 200 3), the Ken tucky Court of App eals n o t e d t h a t its “research has not rev eale d n o r h a ve w e bee n cited to any Ken tucky case app ly ing the ‘discovery

rule’ in a p rope rty

da ma ge action .”

In this case, the plaint if f seeks recovery f or the disap pea rance of 85 15-to n piece s of me tal ma chine ry tha t w ere stored on a 20-a cre plot of land

. T hrou gh the exercise of due diligence, the ref ore, Com mu nity T rust Ban k, the issuer of the loan s to Sm ith and the Sm ith

com pan ies tha t w ere collate raliz ed by the shields, shou ld have discovered tha t the shields had bee n mo v ed w it h o u t a u tho riz ation f rom the prop erty on w hich the y w ere stored

. Moreover, tha t disappe aran ce should hav e been discov ered through the ex ercise of due

- 12

-No. 1 1-58 31

Madison Capita l Co. v. S & S Sa lvage diligence w ell bef ore the passa ge of tw o y ears f rom the sale o f t he shields in Decem ber 200 5.

Unde r esta blished Ken tucky law , an assignee like M adiso n Capital “si mp ly stands
in the shoe s of the [assignor], subje ct to all equities and def ense s w hich could have bee n asserte d against the c h o s e in t h e han ds of the assignor at the time of the assignme nt.”
W hayn e Sup ply Co. v. Mo rg a n Co n str. Co. , 440 S.W .2d 779 , 782 -83 (Ky

. 196 9). T hus, beca use the def end ant s assert tha t Com mu nity T rust shou ld have bee n aware of the sale of the shields w ell bef ore the expiration of the tw o-y ear f iling period f or a conversion claim, Madison Capita l is also su bject to t hat sam e requirem ent

.

T he plaint if

f ’s conversion cause of acti o n in this case w as not base d upo n laten t injury , laten t illness, or f raud ulen t conce alm ent by the def end ant s. As a result, the district
court erred in app ly ing the discovery rule w hen det ermin ing the last dat e on w hich Madison Capita l could ha v e f iled a tim ely comp laint a gainst S & S Salvage and Riv er Meta ls.

But , even if the discovery rule had bee n ap plied app ropriate ly in this ma tter, the plaint if f could not est a b li sh tha t the district court abu sed its discretion in ruling tha t the plaint if f raised no genuine dispu te of f act tha t w ould indicat e tha t the conversion claim w as f iled in a time ly ma nne r. Madison Capita l cont end s tha t loan of f icer Kee ne w as conf used during his d epo sition when he testif ied t hat Com mu nity Trust knew that the shield s w ere missing mo re tha n tw o y ears bef ore the plaint if f f iled its suit against the def end ant s. Accordin g to the plaint if f , Kee ne w as not shown during his dep osition the lette r to C.W

.

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Madison Capita l Co. v. S & S Sa lvage Mining upo n w hich his testim ony w as base d, correspo nde nce tha t w ould have clarif ied tha t the lette r actu ally discusse d the sale of equipm ent oth er tha n the Hem scheid t shields, not the disap pea rance of the shields tha t led to the initiation of this cause of action

. As not ed by the district court in its den ial of the plaint if f ’s mo tion to alter, am end , or v acat e, howev er:
[E]ven co nside ring Keen e’s statem ent that he w as co nf used by the August 23rd lette r, Kee ne’s d epo sition d em onst rates tha t CT B b ecam e a w are that the Shie lds w ere missing som etim e bet w een July and Sep tem ber of 200 6. Loo king to Kee ne’s d epo sition, the re are f our sepa rate instan ces w here Kee ne ackno w ledges th at CT B kn ew the S hields w ere m issing.

B e f o re the August 23rd lette r w as discusse d at his dep osition , Kee ne ackno w le d ge d tha t CTB knew tha t the Shie lds w ere missing. Kee ne w as asked : Q: Did y ou ever beco me aware of the sale of

the shield s? A: Once the loan def aulte d and w e w ent out to take a look at every thing and w e w ere kind of taking inventory of every thing, w e sa w tha t th ey w ere gon e.

T here af ter, Kee ne w as told of the August 23rd lette r to C.W

. Mining and w as the n a sked: Q: W hen y ou learne d the re w as certain equipm ent missing, w hat equipm ent did y ou learn w as m issing? A: If I recall correctly, I t h in k w e sent Mr. Ben tley back out the re to inventory every thing and I think w e discovered – I w ent out the re and actu ally me t him , and I don ’t reme mb er the dat es o f t h a t

. And I think tha t he poin ted out tha t, y ou know, tha t tho se w asn’t [ s ic] the re w here he had looke d at the m bef ore, I guess. Q: A nd w hen you say those , to w hat are y ou ref erring? A: T o th e sh ields a nd the longw all. Kee ne w as th en asked again a bou t th e S mith com pan ies’ de f ault:

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Madison Capita l Co. v. S & S Sa lvage

Q: W h a t w as the nat ure of Mr. Sm ith or his com pan ies’ def ault? W as it f ailure t o p ay? A: Yes, de linquent payme nt. Q: And tha t hap pen ed shortly af ter the execution of the June ‘06 d ocum ent s? A: Base d o n th e tim ing of the oth er do cum ent s, yes. Q: And w e alread y talked abo ut this. T hat ’s w hat precipita ted CTB to get ou t th ere a nd look a t its co llateral? A: Correct. Q: Othe r tha n the shields w e’re talking abo ut tod ay and the CW equipm ent , was there an y oth er m issing equipme nt? A: Not th at I ’m a w are o f

.
Last ly , regarding the assignme nt of the loan s to Madison , Kee ne w as asked :

Q: And at the time of this assignme nt, CTB w as aware tha t the shields w ere gon e? A: T hat time f rame – Ju s t go ing by y our lette r I w as having troub le recollectin g the time

. W as the lette r f rom Mr. Receski prior to tha t? Q: T he lette r f rom Mr. Receski w as dat ed August 23 of ‘06 to CW Mining regarding equipme nt so ld to the m. A: Okay. And w hat [sic] w as the Madison agreem ent ent ered ? Q: T he Madison agreem ent [CT B’s assignme nt to Madison ] culm inate d in Sep tem ber o f ‘06. A: So, yes, w e p roba bly w ere a w are o f it at tha t tim e. Q: And w as CTB aware tha t in particu lar the shields tha t w e are h ere f or to day w ere m issing? A: T hat ’s my und erstan ding.

Madison II , 79 4 F. Sup p.2 d a t 73 8-39 (citation s to record o mitt ed).

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Madison Capita l Co. v. S & S Sa lvage Even mo re dam ning f or the plaint if f ’s challen ge to the district court’s dism issal of its conversio n c la im on statu te-of -limitation s gr oun ds is the v ery language of Com mu nity
T rust’s ass ignm ent to Madison Capita l. In tha t docu me nt, executed on Sep tem ber 29, 200 6, mo re tha n tw o y ears prior to the initiation of this litig ation , the ban k me mo rializ ed its sale, assignme nt, conveyance, and transf er to the plaint if f of all rig hts and intere sts w ith
respe ct to ban k credit docu me nts involv ing the loan s to Sm ith and his com pan ies “including but not limited to any claim s associa ted with the un authoriz ed sale of the long wa ll miner
in w hich CTB has a security intere st

. . . .” (Emp hasis add ed. ) In lig ht of tha t language in
an agreem ent to w hich Madison C apita l w as a party , the plaint if f cannot now

l egitimat ely claim tha t it d id no t kno w , or t hat it shou ld not have known, of its respo nsibility to en sure tha t the 85 Hemsch eidt shields had not been sold as of Sep tem ber 29, 200 6, the dat e of the agreem ent

.
Beca use, at the v ery la t e s t , t h e p la intif f w as aware on tha t dat e of the nee d to investig ate the alleged conversion of the shields, any action in regard to tha t inten tiona l tort

mu st have bee n filed by Sep tem ber 2 9, 2 008 . B ut, beca use Madison Capita l did not f ile its com p la in t a gain st S & S Salvage unt il Novembe r 10, 200 8, and against Riv er Metals
unt il Februa ry 13, 200 9, the d is t ri c t c ourt did not abu se its discretion in den y ing the plaint if f ’s mo tion to alter, am end , or v acat e the orde r of dism issal of the conversion cause of action on statu te-of -limitation s gr oun ds, even if the discovery rule had bee n app lied
prop erly in th is case.

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Madison Capita l Co. v. S & S Sa lvage

Sua S ponte Gra nt of Summary

Judgment on S ele cted Cla ims

In its June 15, 201 1, me mo rand um opin ion and orde r, the district court also seized the opp ortun ity to gr ant , sua spon te , sum ma ry judgme nt to the def e n d a n t s on Madison Capita l’s claims of trespa ss to per s o n a l p ro perty and w rongf ul w ithho lding of perso nal
prop erty. Such a decision to gr ant sum ma ry judgme nt sua spon te is rev iew ed by this court und er tw o distinct stan dard s of rev iew

. W e rev iew the proce dura l decision to ent er

sum ma ry

j udgm ent sua spon te f or an ab use of discr etion

. Ben net t v. City of Eastp ointe , 410 F.3d 810 , 816 (6th Cir. 200 5). T he actu al sum ma ry judg m e n t ruling, howev er, is

rev iew ed de novo und er the usua l sum ma ry judgme nt stan dard s. Id. W e f irst add ress the
proce dura l issue, and “[i]f w e f ind n o a buse of

discretio n in the district co urt’s proce dura l decision , w e rev iew the decision subst ant iv ely. If w e f ind a proce dura l abu se of discretion ,
w e rev erse and rema nd to provide the district court the o p p o rt u n it y to rev iew all of the evidence bef ore m aking a su bsta ntive decision .” Id.

W e w ill not f ind tha t a district court abu sed its discretion in s u a spon te gr ant ing

sum ma ry judgme nt as long as “the losing party w as on not ice tha t [it] had to com e f orw ard

w ith all of [its] evidence

. . . [an d had a] reaso nab le opp ortun ity to respo nd to all the issues
t o be consid ered by the court. ” She lby Cnty. Health Care Corp. v. S. Coun c il o f I n d u s

. W orkers Health & W

elfare Trust Fund , 203 F.3d 926 , 931 (6th Cir. 200 0) (interna l quotat ion

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Madison Capita l Co. v. S & S Sa lvage

ma rks and citation s om itted ). Madison Capita l cont end s, howev er, tha t it had no not ice of the district court’s inten t to issue an orde r of sum ma ry judgme nt on the plaint if f ’s trespa ss and w rongf ul-w ithho lding claims beca use, in the court’s Janu ary 19 me mo rand um opin ion,
t he district judge specif ically den ied sum ma ry judgme nt to the def end ant s on tho s e t wo

cause s of

actio n.
Nevertheless, the district court cle a rl y did not abu se its discretion in det ermin ing later tha t the plaint if

f had not ice and a reason able opportu nity to add ress the prop riety of

a sum ma ry -judgmen t ruling on th e t re spass and w rongf ul-w ithho lding claims. W ithou t question , Madison Capita l w as aware tha t the trespa ss claim w as bein g consid ered by the district court in conju nction w ith its mo tion to alter, am end , or v acat e the Janu ary 19 ruling of the court. In f act, in tha t mo tion, Madison Capita l itself argued tha t it had “satisf ied the elem ent s of its trespa ss claim. ” T he pla in tif f , af ter arguing the me rits of tha t cause of action , cann ot now be hea rd to com plain tha t the district court chose to add ress the issue

as w ell. T he district judge clearly did not abu se his discretion in issuing a sua spon te ruling

on Madison Capita l’s claim o f tresp ass to pe rsona l prop erty.

A similar discussion of the me rits of the w rongf ul-w ithho lding claim did not occur in the cont ext o f arguing f or or against the ef f icacy o f t h e p la intif

f ’s mo tion to alter, am end ,
or v acat e t h e J a nua ry 19, 201 1, opin ion and orde r. Madison Capita l still cann ot legitimate ly claim, howev er, tha t it did not have suf f icient opp ortun ity to add ress the legal the ories upo n w hich the district court rested its decision to gr ant the def end ant s sum ma ry

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Madison Capita l Co. v. S & S Sa lvage judgme nt on tha t cause of action

. In its Janu ary 19 decision , the district court clearly explained tha t w hen , as in this case, the alleged wro ng “occurred by w ay of a w rongf ul taking at the out set,” Madison I , 765 F. Sup p.2 d at 932 , a claim f or conversion is the prop er

w ay to challen ge the dep riv ation of priv ate prop erty and tha t “dem and and ref usal nee d not be proved.” Id. By so conclu ding, the district court serv ed not ice of its det ermin ation tha t
any dep riv ation of perso nal prop erty in this case oc c u rr e d a t t he out set of the partie s’ intera ctions and thu s did not involv e the legitimate initial posse ssion by the def end ant s tha t

w ould sup port a claim f or a subse quent w rongf ul w ithho lding. Beca use the plaint if f thu s had suf f icient opp ortun ity to cont est the district court ruling tha t the elem ent s of a

conve rs io n claim had bee n suggested by the f acts of the case, the district judge did not abu se his discretion in sua spon te choo sing t o subje ct the wro n gf ul-w ithho lding claim to

sum ma ry -judgmen t an alysi s.

Madison Capita l neverthe less argues bef ore this court tha t the district court’s gr ant of sum ma ry judgme nt on its trespa ss and w rongf ul-w ithho lding claims prevente d the plaint if f f rom ad va n c in g a lterna tiv e argume nts regarding the liability of the def end ant s. How ever, the only restraint on the advance me nt of altern ative the ories by the plaint if f w as Madison Capita l’s own f ailure to allege f acts tha t describe d anything oth er tha n a claim of conversion. T o the extent tha t the plaint if f thu s f ailed to state claims f or t re s p ass and

w rongf ul w ithho lding by assertin g tha t the only interf eren c e b y t he def end ant s w ith the shields w as bot h tota l and com plete ly illegal, the district court d id not err in gr ant ing

sum ma ry

judgm ent to the de f end ant s on tho se claim s. - 19

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Madison Capita l Co. v. S & S Sa lvage Havi ng det ermin ed tha t no such abuse of discretion ha s be en shown in th is case,

w e next re vie w t h e district court’s orde r de novo , utiliz ing t he sam e stan dard s em ployed by th e district ju d ge

. S e e Ci m inillo , 434 F.3d at 464

. W e w ill a f f irm a gr ant of sum ma ry judgme nt “if the mo v ant shows tha t the re is no genuine dispu te as to any ma terial f act and the mo v ant is ent itled to judgme nt as a ma tter of law .” Fed. R. Civ

. P. 56(a ). W e w ill f ind tha t a genuine dispu t e o f m a terial f act exists only w hen , assum ing the truth of the non mo v ing party’s evidence and const ruing all inf eren ces f rom tha t evidence in the lig ht mo st f avorable to the non -moving party, the re i s suff icient evidence f or a trier of fact to f ind f or tha t party. A non -moving party cann ot wit h s t a n d sum ma ry judgme nt, howev er, by introd uction of

a “m ere scin tilla” of

evidence in its f avor. See Cim inillo , 43 4 F.3 d a t 46 4.

Claim of Trespa ss to Pers onal P roperty

In challen ging t h e d ist rict court’s sum ma ry -judgmen t decision on its claim of trespa ss to perso nal prop erty, Madison Ca p it a l asserts tha t beca use the statu te of limitat ions f or initiating such a trespa ss action is f iv e years f rom the accrua l of the injury,

see Ky . Rev . Stat. § 413. 120 (4), the district court erred in gr ant ing sum ma ry j udgm ent to the def end ant s base d upo n the expiration of a tw o-y ear statu te-of -limitation s period

. For
tw o prima ry reaso ns, one subst ant iv e and the o t h er policy- driv en, the me re act of den om inatin g its cause of action as trespa s s , ra the r tha n conversion, doe s not save the plaint if f f rom the ad v erse co nseque nces of its de lay in bringing this su it.

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Madison Capita l Co. v. S & S Sa lvage First, the subst ant iv e dif f eren ce bet w een the torts of conversion and trespa ss to
perso nal prop erty preclud es Madison Capita l f rom rely ing upo n the f iv e-y ear limitat ion on f iling tha t is me ntion ed in Ky. Rev. Sta t. § 413 .12 0(4) w hen assertin g its claims in this case. As recogniz ed by th e d istrict court in its July 15 me mo rand um opin ion, “[a] trespa ss to a chat tel ma y be com mitt ed by inten tiona lly dispo ssessing ano the r of the chat tel or using or interm edd ling w ith a chat tel in the posse ssion of ano the r.” Caldw ell’ s Ken tucky Form Boo k (5th ed. ) , § 126 .00 (201 1). See Ma d is o n II , 794 F. Sup p.2 d at 740

. How ever, beca use

con ve rs io n is also “an inten tiona l exercise of dom inion or cont rol over a chat tel,” Restat em ent

( Seco nd) of Torts , § 222 A (196 5), com me nta tors have bee n fo rced to draw “a distinctio n bet w een me re trespa ss interf ering w ith posse ssion of a chat tel, and a conversion, w hich mu st involv e s o me exercise of the def end ant ’s host ile dom inion or cont rol over it.” Id. , § 222 A at cmt

. a. In dif f eren tiating bet w e e n t h e t wo conce pts, the

com me nts in the Restat em ent (Seco nd) o f Torts

no te:

In trespa ss the plaint if

f ma y recover f or the d im in is hed v alue of his chat tel beca use of any dam age to it, or f or the dam age to h is in terest in its posse ssion or use. Usually, altho ugh not nece ssarily , such dam ages are less tha n the f ull v alue of the chat tel itself

. In conversion the me asure of dam ages is the f ull v alue of the chat tel, at the time and place of the tort.

. . . Co nversion is

. . . prop erly limited , and has bee n limited by the cou rt s , t o tho se serious, ma jor, and imp ortan t interf eren ces w ith the rig ht to cont rol the chat tel which justif

y requiring the d ef end ant to pay its f ull value.

Id. , § 222 A a t cm t. c.

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Madison Capita l Co. v. S & S Sa lvage T he sam e distinctio ns have bee n recogniz ed in Ken tucky. For instan ce, as state d
in 13 Ken tucky Practice Series Tort Law § 7:1 (201 1 ), “[ t ] respa ss to chat tels involv es relatively min or dam ages or dep riv ation , w hile c o nversion involv es conse quence s w hich justif y the r ight of

the plain tif

f to recover the f ull value of the pe rsona l prop erty af f ecte d.”
T hus, “[if

] the interf eren ce w ith the rig hts of the posse ssor is serious eno ugh, it wil l
const itute conversion.” Caldw ell’ s Ken tucky Form Boo k (5th ed. ) § 126 .00 (201 1). Sta ted dif f eren tly , “if return of the chat tel is not possib le, or the interf eren ce w ith its use has bee n

so serious and significan t tha t it is just to require the def end ant to pay the f ull v alue of the chat tel, t hen an actio n f or con v ersion shou ld be brou ght.” Id.
Clearly , th e co mp lete dism ant ling and re-f ormin g of the 15 -ton shields into piece s of scrap me tal no larger tha n tw o-f eet by f our -f e e t b y six -inches const itute s a serious
in terf eren ce w ith, and a tota l dep riv ation of , the rig hts of the owner of the shields. Any claim f or such i nte rf eren ce, there f ore, mu st have bee n brought as a claim f or conv ersion tha t is subje ct to the tw o-y ear statu te of limitat ions con t a in e d in section 413 .12 5 of the Ken tucky Re vis e d S tatu tes. T hus, f or subst ant iv e reaso ns, the district court correctly
gr ant ed sum ma ry judgme nt to the def end ant s on Madison Capita l’s trespa ss-to-perso nalprop erty claims beca use tho se claims w ere not f iled as conversion claims w ithin tw o y ears of the accrua l of

the cau ses o f

actio n.

F ur th er mo r e, l eg i ti ma te po licy reaso ns supp ort app lication of the tw o- y ea r s ta tu te

- oflimitat ions period to the prof f ered trespa ss cause s of action

. As previously state d, an act

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Madison Capita l Co. v. S & S Sa lvage of conversion ent ails a mo re com plete , a mo re prolon ged, a mo re serious dep rivation of the owner’s chat tel th an doe s a m ere t respa ss. “Clearly , KRS 4 13. 125 [an d its t w o-y ear statu te of limitat ion] app lies to a conversion s in ce the re is no specif ic language of conversion in KRS 413 .12 0(4). It w ould be illogi cal to app ly a tw o-y ear statu te of limitat ion
to conversion, but a f iv e-y ear statu te to trespa ss to chat tels, a tort of lesser culpa bility .” 13 Ky. P rac. Se ries Tort L aw § 7 :1 (f oot not e o mitt ed).

Claim of Wrongful Wi thholding

T h e principle of law is w ell-estab lished tha t “[w ]e ma y not const rue a stat u t e in a

ma nne r tha t re nde rs part of the law supe rf luou s.” United Sta tes v. Perry , 360 F.3d 519 , 537 (6th Cir. 200 4). In oth er w or d s , “[i]t is a cardina l rule of statu tory const ruction tha t significan ce and ef

f ect shall, if possib le, be accord ed to e v eryw ord.” W ash. Market Co.

v. Hoffman , 101 U.S. 112 , 115 -16 (187 9). So as not to rend er eithe r the provisi ons of Ky. Rev. Sta t. § 413 .12 5 (setting a tw o-y ear per io d f or bringing claims of conversion) or § 413 .12 0(5) (setting a f iv e-y ear period f or bringing claims of w rongf ul w ithho ld ing of
perso nal prop erty) me anin gless, it is thu s essen tial tha t the conce pts of conve rs io n a nd

w rongf ul w it h h o ld in g be ana ly z ed dif f eren tly

. Altho ugh Madison Capita l purp orts to

ma intain such a distinctio n bet w een the tw o torts, in reality, the plaint if f ’s plea dings in this

ma tter blur any subst a n t ive dif f eren ce bet w een the tw o conce pts w hile still seekin g to ben ef it f rom dif

f eren t pro cedu ral requireme nts.

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Madison Capita l Co. v. S & S Sa lvage As explained in the Restat em ent (Secon d) of Torts , § 222 A cmt

. a, “conversion” has

com e to be regarded “as an exerci s e o f t h e def end ant ’s dom inion or cont rol over the

c hat tel, as distinguishe d f rom a me re interf eren ce w ith the chat tel itself , or w ith the
posse ssion of it.” T h u s , wh e n perso nal prop erty is alleged to have bee n take n and dest roy ed, and w hen tha t taking is also imp rope r at the out set, a cause of action f o r conversion arises. On the oth er han d, w hen a def end ant initially hold s or posse sses prop erty legally

but later f ails to turn the property over to its rig htf ul ow ner upo n dem and ,
a claim f or w rongf ul w ithho lding is prop er. T he f ew pub lished Ken tucky cases tha t involv e assertio ns o f

w rongf ul wi thh olding illustrate this d if f eren tiation

.

In Crowd er v. Barne s Aut om obile Co. , 218 S.W .2d 679 (Ky

. 194 9), f or examp le, the plaint if f “sought to recover dam ages f or th e a ll e ge d w rongf ul w ithho lding of a new Ford
aut om obile” by a car dea ler w ho initially h a d le ga l title to the v ehicle. Id. T he Ken tucky Co u rt of App eals conclu ded , howev er, tha t no w ithho lding had occurred beca use “t h e purch aser acquired no rig ht, title or intere st in the prop erty unt il it w as delivered to him and eithe r the f ull purch ase price paid in cash or a satisf acto ry def erred payme nt plan ent ered into. ” Id. at 680 (emp hasis add e d ). A b s e nt the required payme nt or payme nt plan , the ref ore, Crow der n ever suf f ered an y

de priv ation of his

prop erty at all.

Like wis e , t he plaint if

f s in Maxim um Machine Co. v. City of She phe rdsville , 17 S.W .3d 890 (Ky

. 200 0), suf f ered no serious dep riv ation of or dam age to perso nal prop erty. In tha t case, com pan ies tha t had paid a busin ess license tax to the City of She phe rdsv ille

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Madison Capita l Co. v. S & S Sa lvage in 199 0, 199 1, 199 2, and 199 3 sued f or a ref und of tho se payme nts af ter a court decla red the ordina nce requiring the tax paym e n t “v oid due to proce dura l inf irmities.” Id. at 891

. T he Ken tucky S upre me Court conclu ded tha t th e u nique f acts o f tha t case called f or th e app lication of the f ive -ye a r statu te of limitat ions f oun d in sesction 413 .12 0(5) f or action s f or dam ages f or w ithho lding of perso nal prop erty. No party asserte d tha t any conversion
h a d occurred , in part beca use the initial collection of the taxes had no t ye t b e e n det ermin ed to be illegal. T hus, the choice bef ore the Ken tucky courts w as not bet w een a tw o-y ear conversion statu te of limitat ions and a longer w rongf ul-w ithho lding statu te of limitat ions, but rathe r bet w een the f iv e-y ear limitat ions period of Ky. Rev. Sta t. § 413 .12 0(5) and a tw o-y ear statu te of limitat ions on claims f or ref und s of ad valorem taxes or f or taxes later held to be unco nstitu tiona l. See Ky. Rev. Sta t. § 134 .59 0(3). Beca use the busin ess license taxes at issue in the case w ere not ad valorem taxes, and beca use the ordina nce h a d bee n invalidated due to proce dura l inf irmities, not its unco nstitu tiona l nat ur e , t h e shorte r time pe riod f or f iling suit w as n ot a pplicab le.

Madison Capita l’s w rongf ul-w ithho lding claim in this case, by cont rast, doe s not allege tha t the def end ant s’ posse ssion of the 85 shields w as ever legal or prop er. T o the
cont rary , the plaint if

f asserts tha t the def end ant s’ posse ss ion w as illegal f rom the out set and tha t S & S Salvage and R iv er M eta ls exercised such comple te contro l and do min ion

over the shields tha t the only reme dy tha t could com pen sate the plaint if f f or its loss w ould be payme nt of the f ull v alue of the prop erty at the time of the taking. Such an assertio n is
unque stiona bly a claim f or conversion of perso nal p rope rty , not a claim f or w rongf ul - 25

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Madison Capita l Co. v. S & S Sa lvage

w ithho lding by the def end ant s of prop erty once posse ssed w ith aut horization. T he district
court w as thu s correct to gr ant sum ma ry judgme nt to the def end ant s and to conclu de tha t the alleged w rongf ul-w ithho lding claim in this ma tter w as really not hing but a conversion

cause of actio n u nde r a d if

f eren t na me

. 1

Exc lusion of Tes timony of Proffered E xpert W itness es

In a f inal app ellate challen ge, Madison Capita l ma intain s tha t the district court erred
in excluding the testim ony of tw o w itnesse s of f ered by the plaint if

f to testif y regarding the
scrap m eta l v alue of the shields. A brief revi ew of

the proce dura l history of this litigation shows, howev er, th at t his issue is no t pro perly bef ore t he court f or review at this tim e.

On Janu ary 19, 201 1, the district court issued its decision in Madison I tha t gr ant ed the def end ant s summ aryj udgm ent on a num ber o f the cau ses o f

actio n identif ied by the plaint if f

. T hat me mo rand um opin io n and orde r also den ied the def end ant s sum ma ry judgme nt on the trespa ss and w rongf ul-w ithho lding claims, reservi ng f u rther action on tho se alleged base s f o r re li e f f o r a f utu re dat e. T hat sam e day, Janu ary 19, the district
court issued a secon d me mo rand um opin ion and orde r gr ant ing the def end ant s’ mo tion to exclude the testim ony of tw o of Madison Capita l’s “ex pert w itnesse s.” See Madison Capita l

D e s p i t e t h e d i s t r i c t c o u r t ’ s g r a n t o f s u m m a r y j u d g m e n t t o t h e d e f e n d a n t s d i s p o s i n g o f a l l t h e p l a i n t i f f ’ s 1
c l a i m s , S & S S a l v a g e a n d R i v e r M e t a l s s t i l l c o n t e n d t h a t t h e d i s t r i c t c o u r t e r r e d i n f a i l i n g t o r u l e f a v o r a b l y u p o n t h e i r r e q u e s t t o a p p l y t h e d o c t r i n e o f l a c h e s t o t h e p l a i n t i f f ’ s c a u s e s o f a c t i o n

. O b v i o u s l y , t h a t a l l e g a t i o n o f e r r o r h a s b e e n r e n d e r e d m o o t b y o u r d e t e r m i n a t i o n t h a t t h e d i s t r i c t c o u r t d i d n o t e r r i n g r a n t i n g s u m m a r y j u d g m e n t i n f a v o r o f t h e d e f e n d a n t s o n a l l c l a i m s a s s e r t e d b y t h e p l a i n t i f f i n b o t h i t s c o m p l a i n t a n d i t s a m e n d e d c o m p l a i n t

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Madison Capita l Co. v. S & S Sa lvage Co., LLC v. S & S Salva ge, LLC (Madison III) , No. 4:0 8-CV-001 34-JHM, 201 1 W L 195 639 (W .D. Ky. Jan . 19 , 20 11).

T hree w eeks later, Madison Capita l f iled a mo tion to alter, am end , or v acat e portio ns of Madison I

. Spe cif ically , the plaint if f sought “to alter, am end or v acat e the portio n of the Court’s Janu ary 19, 201 1 orde r gr ant ing def end ant s’ mo tion f or sum ma ry judgme nt as to Madison ’ s claim for conve rsion [an d mo v ed] the Court to clarif y its Order, and to narrow the
scope of trial by hold ing the D ef end ant s l iable f or trespass .

. . .” (Emp hasis add ed. ) On June 15, 201 1, in docke t ent ry 132 , the district court den ied the mo tion to alter, am end , or

v acat e and f urthe r gr ant ed sum ma ry judgme nt, sua spon te , on the plaint if f ’s trespa ss and

w rongf ul-w ithho lding claims.

On July 8, 201 1, Madison Capita l f iled a time ly not ice of app eal in w hich the plaint if f designat ed only “the Memo rand um Opinio n and Order [Doc. 132 ] (the f inal judgme nt) (f rom

an orde r (describing it)) e nte red in this action on the 15t h d ay of Jun e, 2 011 ,” as a ba sis of appea l. As described ab ove, tha t m em oran dum op inion and orde r in no w ay involv ed

or add ressed the issue regarding expert testim ony tha t the plaint if f now seeks to place bef ore this pan el. Pursua nt to the provisi ons o f Fede ral Rule of App ellate Proced ure 3(c)(1)(B), a not ice of app e a l mu s t “designate the judgme nt, orde r, or part the reof bein g app eale d.” Be cause the orde r excl udin g th e testim ony of tw o of the plaint if f ’s w itnesse s

w as not include d in Madison Capita l’s not ice of app eal, any allegation of error in tha t ruling is not prop erly bef ore us at this time

. See , e.g

. , Crawf ord v. Roan e , 53 F.3d 750 , 752 (6th

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Madison Capita l Co. v. S & S Sa lvage Cir. 199 5) (holdin g tha t altho ugh “app eal f rom a f inal judgme nt draws into question all prior

non -f inal rulings and orde rs,” w hen a party “choo ses to designat e specif ic det ermin ation s in its n otice of

ap pea l, on ly

tho se d ete rmina tions ma y be raised on ap pea l”).

Furthe rmore , beca use the plaint if f ’s suit against S & S Salvage and Riv er Metals also engen dere d certain as -ye t -u nreso lv ed cross-claims and third-pa rty claims bet w een the def end ant s and between S & S Salvage and T imo thy P. Sm ith, Madison Capita l f iled

a mo tion in the district court “to certif y the June 15, 201 1 Memo rand um Opinio n and Order [Doc. 132 ] as a f inal, app eala ble judgme nt pursu ant to Fed. R. Civ

. P. 54(b ).” T he district
court gr ant ed tha t mo tion, certif y ing only “that its Memo rand um , Opinio n and Order dat ed June 15, 201 1, is a f inal and app eala ble orde r, and tha t the re is no just re a s o n t o dela y app ellate re vie w. ” Madison Capita l Co., LLC v. S & S Salva ge, LLC (Madison IV) , No. 4:0 8-CV-001 34-JHM, 20 11 W L 367 879 6, at *2 (W .D. Ky. Aug. 2 2, 2 011 ). Again, in light of tha t ord er, onlythe conversi on, tr espa ss, and w rongf ul-w ithho lding decision s i nclud ed
in the June 15 me mo rand um opin ion a re p ro p e rl y bef ore us at this time

. T here is, the ref ore, neith er nee d nor jurisdi ction to add ress in this app eal the plaint if f ’s claim regarding the exclusion of alleged expert w itnesse s.

CONCLUSION

For the reaso ns se t ou t ab ove, w e A FFIRM the judgme nt o f the district co urt.

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