The opinion of the court was delivered by: RUBEN CASTILLO, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Molex Incorporated's ("Molex") motion to reconsider
our May 10, 2004 Order granting Defendant Gregory T. Wyler's
motion to dismiss Molex's Complaint pursuant to Federal Rules of
Civil Procedures 12(b)(1) and 12(b)(6) is before the Court. (R.
8-1.) Because our initial dismissal was closely linked to the
facts alleged in the Complaint, a brief review of those
allegations is appropriate here.*fn1
The Complaint arises from a 1998 stock purchase agreement
("Purchase Agreement") in which Molex agreed to purchase all of
the outstanding and issued shares in Silent Systems, Inc.
("Silent"), a privately-held Massachusetts corporation of which
Wyler was the majority shareholder. (R. 1, Compl. ¶¶ 7-9.) Wyler
and Silent represented and warranted that the Purchase Agreement
disclosed the identities of all of the stockholders owning
capital stock in Silent. (Id. ¶ 10.) Wyler also agreed to
indemnify and defend Molex for any loss or expenses relating to
any claim made by persons not disclosed in the Purchase Agreement
who might claim any right to Silent's stock. (Id. ¶ 12.)
At the time that Molex became obligated under the Purchase
Agreement to purchase Wyler's shares, a dispute arose regarding
the proper calculation of the purchase price for those shares.
(Id. ¶ 17.) On February 29, 2000, Molex, Wyler, and Silent
entered into an agreement ("Settlement Agreement") that settled
the price controversy. (Id.) Wyler represented and warranted in
the Settlement Agreement that he owned his shares free and clear
of any liens or restrictions. (Id. ¶ 20.)
After Molex purchased Wyler's shares, it received notice that
Wyler's father, Geoffrey Wyler ("Geoffrey"), claimed that he was
the co-owner of the Silent shares that Molex purchased from
Wyler. (Id. ¶ 21.) In 2001, Geoffrey filed suit against Wyler,
Silent, and Molex in Massachusetts state court seeking, among
other things, rescission of the purchase transaction. (Id. ¶
23.) After making several unmet demands upon Wyler for
indemnification with respect to the Massachusetts action, Molex
filed the current action on March 4, 2004. (Id. ¶ 24.)
On May 5, 2004, Wyler filed a motion to dismiss Molex's
Complaint, claiming a lack of subject-matter jurisdiction under
Rule 12(b)(1) and failure to state a claim under Rule 12(b)(6).
We granted the motion without taking full briefing from the
parties. (R. 7.) Molex then filed the present motion for
reconsideration. For the reasons set forth below, we grant
Molex's motion in part and deny it in part.
Whether to grant a motion to reconsider is a matter squarely
within the Court's discretion. Caisse Nationale de Credit
Agricole v. CBI Indus., Inc., 90 F.3d 1264, 1270 (7th Cir.
1996). Typically, we will reconsider a prior judgment only where
we have "patently misunderstood a party," "made a decision outside the adversarial issues
presented," or "made an error not of reasoning but of
apprehension." Bank of Waunakee v. Rochester Cheese Sales,
Inc., 906 F.2d 1185, 1191 (7th Cir. 1990). However, because we
granted Wyler's motion to dismiss without allowing Molex the
opportunity to brief the issues, we will not apply these
standards strictly here. See, e.g., Flanagan v. Methodist Hosp.
of Chi., No. 95 C 7287, 1996 WL 374131, at *1, n. 1 (N.D. Ill.
Jun. 28, 1996).
I. Count One: Declaratory Judgment
Count I of Molex's Complaint requests a declaratory judgment
finding that Wyler is obligated under the Purchase Agreement to
defend and indemnify Molex in the Massachusetts action and the
Settlement Agreement does not relieve Wyler of those duties. (R.
1, Compl. ¶ 27.) Molex contends that this request for declaratory
judgment is ripe even though the Massachusetts action in which
the court will decide whether Geoffrey has any claim in the
Silent shares Molex purchased from Wyler is on-going. For the
reasons set forth below, we agree with Molex's arguments only as
they pertain to the question of Wyler's duty to defend Molex in
the Massachusetts action.
The Declaratory Judgment Act allows any federal court to
"declare the rights and other legal relations of any interested
party seeking such declaration" and that declaration has the full
force of a final judgment. 28 U.S.C. § 2201. Before the Court can
decide whether a declaratory judgment is appropriate in this
matter, we "must first determine whether the court has subject
matter jurisdiction, i.e., whether the case presents an `actual
controversy' between the parties." Basic v. Fitzroy Eng'g, Ltd., 949 F.Supp. 1333, 1337 (N.D. Ill.
1996); Tobin v. City of Peoria, Ill., 939 F.Supp. 628, 634
(C.D. Ill. 1996) (stating that in a declaratory judgment action,
the Court "should be `particularly vigilant' to make certain the
case is ripe"). Whether an actual controversy exists under the
Declaratory Judgment Act turns on whether "there is a substantial
controversy, between parties having adverse legal interests, of
sufficient immediacy and reality to warrant the issuance of a
declaratory judgment." Maryland Cas. Co. v. Pacific Coal & Oil
Co., 312 U.S. 270, 273 (1941).
There certainly exists a "substantial controversy" regarding
Wyler's duties to defend and indemnify Molex; the parties
disagree as to whether Wyler must pay Molex's defense costs in
the Massachusetts litigation and as to whether Wyler must
indemnify Molex for any liability it eventually sustains in that
action. The adversity of their legal interests is equally
obvious. The more difficult question for both issues is whether
they are sufficiently immediate to justify issuance of a