UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

OAK STREET FUNDING, LLC,

Plaintiffs,

v.

LYNN S. INGRAM, PAUL MURPHY, and

360 RISK MANAGEMENT, INC.,

Defendants.

 /

Case No. 09-cv-12736

HONORABLE STEPHEN J. MURPHY, III

ORDER DENYING OAK STREET’S MOTION 

FOR RECONSIDERATION (docket no. 24)

Oak Street Funding LLC (“Oak Street”) has asked this Court to reconsider two of the

rulings in its August 10, 2010 Order (“August 10 Order”) granting in part and denying in part

the defendants’ motion for summary judgment. Specifically, Oak Street asserts that the

Court erred in dismissing their conversion and unjust enrichment claims against Lynn S.

Ingram, Paul Murphy, and 360 Risk Management, Inc. (“360"). 

Ingram was a founding member of the Ponta Castle Ingram Agency, Inc. (“PCI”), a

now-defunct insurance company based in Michigan. Oak Street provided loans to PCI,

secured by PCI’s business assets, including its customer accounts. Ingram allegedly

transferred these accounts to the Mears Insurance Agency with the assistance of Murphy

and 360, in violation of his employment contract with PCI. Oak Street asserts that the

defendants’ actions deprived them of a right in property that was properly theirs once PCI

defaulted on the loans and Oak Street’s security interest in all PCI property interests

became effective. The Court is not convinced by Oak Street’s argument that the August

10 Order contains a palpable, outcome-determinative error in its analysis of the conversion

and unjust enrichment claims. Accordingly, it will deny the motion. 
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STANDARD OF REVIEW

It is an exception to the norm for the Court to grant a motion for reconsideration. See

E.D. Mich. LR 7.1(h)(3) (“Generally . . . the court will not grant motions for rehearing or

reconsideration that merely present the same issues ruled upon by the court, either

expressly or by reasonable implication.”). To obtain reconsideration, the movant must (1)

“demonstrate a palpable defect by which the court and the parties and other persons

entitled to be heard on the motion have been misled” and (2) “show that correcting the

defect will result in a different disposition of the case.” Id. The requirement of a “palpable

defect” limits the Court to revisiting only those errors that are “obvious, clear, unmistakable,

manifest, or plain.” United States v. Cican, 156 F. Supp. 2d 661, 668 (E.D. Mich. 2001);

Pakideh v. Ahadi, 99 F. Supp. 2d 805, 809 (E.D. Mich. 2000) (when movant "has brought

up nothing new — except his displeasure — this court has no proper basis upon which to

alter or amend the order previously entered") (quoting Durkin v. Taylor, 444 F. Supp. 879,

889 (E.D. Va. 1977)). Therefore, absent a significant error that changes the outcome of

a ruling on a motion, the Court will not provide a party with an opportunity to relitigate

issues already decided.

ANALYSIS

The August 10 Order rejected Oak Street’s attempts to frame the alleged breaches

of contract by Ingram under theories of conversion and unjust enrichment. Oak Street’s

motion for reconsideration marks a renewed attempt to get these counts past summary

judgment. But the arguments presented here are no more persuasive on the legal points

Oak Street seeks to establish than the arguments the Court considered before entering the

August 3 Order. For the reasons set forth below, the Court’s ruling on both claims should

be sustained.
 1 Oak Street discusses, at considerable length, Tooling, Manufacturing &

Technologies Association v. Tyler, No. 07-081220-CZ, at 6–7 (Mi. Cir. Ct. Oakland County

Aug. 20, 2009), as authority for the proposition that an employer has a right to recoup

payments on insurance commissions from an employer on a conversion theory, even if an

employment contract is violated. Oak Street’s Mot. for Reconsideration, Docket No. 25, 5

n.1; see also id. Ex. A (copy of order). The Court notes that the employment contract in

Tooling did not contain language that prevented the defendant from selling insurance for

anyone other than the plaintiffs. Tooling, No. 07-081220-CZ, at 2–3. The Tooling court did

not, therefore, reach the issue in this case. Whatever persuasive value a decision of a

Michigan trial court might have, the Court finds its conclusion is reconcilable with the

holding of the August 10 Order.

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I. Conversion 

Oak Street’s briefing on the conversion issue is the sort of reconsideration motion that

raises nothing new, other than the displeasure of the moving party. Their brief improperly

regurgitates arguments that were already before the Court by reproducing the relevant

section of their previous brief opposing the defendants’ summary judgment motion in its

entirety. Oak Street’s Mot. for Reconsideration, Docket No. 25, 3–5. Oak Street asserts

that the Court was deceived by “Defendants’ deliberate attempts in their Motion to ‘blur the

line’ between Plaintiff’s separate and distinct tort claims and its derivative contract action.”

Id. at 5. This is little more than an assertion that the Court was wrong for finding the

defendants’ arguments persuasive, and does not demonstrate that the Court committed

palpable, outcome-determinative error. 

Moreover, the Court harbors no confusion over the legal arguments made on this

issue. Oak Street’s claim failed on three grounds. First, the Court found that the

conversion claims in this case could not go forward because they attempt to enforce the

underlying obligations of the covenant not to compete between Ingram and CBI, which is

not permitted under Michigan’s common law of torts.1

 August 10 Order, 15–16. Second,

insofar as Oak Street asserts a property interest in commission income as a result of the

defendants’ conversion, it has failed to specify the monies to which they were entitled. Id.
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16–17. Despite continued insistence on the relevance of their status as secured creditors,

the Court correctly found that this status did not alter the outcome of the case, as Oak

Street had no more rights under the non-compete agreement than CBI did. Id. 17–18.

Finally, the Court does not doubt, as Oak Street argues, that intangible property can serve

as the basis for a conversion claim, but that point of law was not a determinative feature

of the Court’s holding. The Court finds no error, much less a palpable one, in the August

10 Order on this point.

II. Unjust Enrichment

 Oak Street’s argument for reconsideration of the Court’s dismissal of its unjust

enrichment claim is based on similar premises as its arguments in support of the

conversion claim, and it likewise merits rejection. The Court held that because unjust

enrichment requires the implication of a contractual agreement, it cannot apply in a case

where there is already a contract covering the same subject matter. The Court already

rejected the argument advanced by Oak Street that “Ingram’s conversion . . . exceeds in

scope the actions which violate the restrictive covenants of his agreement with PCI.” Oak

Street’s Resp. Mot., Docket No. 12, 17. Oak Street’s reassertion of this point in a motion

for reconsideration does nothing to aid their cause. Oak Street’s Mot. for Reconsideration,

6 (“Oak Street’s causes of action in this matter do not arise from the existence of any of

those contractual agreements. They are independent causes of action . . . .”).

Reconsideration of this holding is therefore inappropriate.
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ORDER

WHEREFORE, it is hereby ORDERED that Oak Street’s motion for reconsideration

(docket no. 24) is DENIED.

SO ORDERED.

s/Stephen J. Murphy, III 

STEPHEN J. MURPHY, III

United States District Judge

Dated: October 28, 2010

I hereby certify that a copy of the foregoing document was served upon the parties and/or

counsel of record on October 28, 2010, by electronic and/or ordinary mail.

Alissa Greer 

Case Manager