McMenemy v. Flagship Financial Group, LLC et al

Filing 50

ORDER signed by Judge John A. Mendez on 10/9/2014 DENYING plaintiffs' 43 Motion for Relief under FRCP 60(b)(1) from 8/25/2014 40 Order denying Motion for Issuance of New Summons. Court further ORDERS that Mr. Winter SHOW CAUSE why he should not be sanctioned. Mr. Winter shall file a Declaration in response to Order within 10 days of its filing. (Marciel, M)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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DIANA McMENEMY, an
individual, and MICHAEL
McMENEMY, an individual,

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Plaintiffs,

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No.

2:14-cv-001482 JAM AC

ORDER DENYING PLAINTIFF’S MOTION
FOR RELIEF UNDER FRCP 60(B)(1)

v.
COLONIAL FIRST LENDING GROUP,
INC., a Utah corporation,
COLONIAL FIRST BUSINESS
DEVELOPMENT, LLC, a Utah
limited liability company,
DEVIN JONES, an individual,
FLAGSHIP FINANCIAL GROUP,
LLC, and DOES 1 through 10,

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Defendants.
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This matter is before the Court on Plaintiffs Diana McMenemy

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and Michael McMenemy’s (“Plaintiffs”) Motion for Relief (Doc.

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#43) from the Court’s August 25, 2014 Order (Doc. #40) under Rule

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60(b)(1) of the Federal Rules of Civil Procedure (“FRCP”).

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Defendant Colonial First Lending Group, Inc. (“Defendant” or

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“CFLG”) opposes Plaintiffs’ motion (Doc. #45).
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Plaintiffs filed

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a reply (Doc. #47).

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motion is DENIED.

For the following reasons, Plaintiffs’

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I.

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OPINION

On August 20, 2014 the Court held a hearing on Plaintiffs’

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motion for the issuance of a new summons.

Plaintiffs’ counsel,

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Patrick Dwyer, failed to appear at that hearing.

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based on the evidence presented by Defendant, the Court denied

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Plaintiffs’ motion.

At the hearing,

On August 25, 2014, the Court issued a

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written order to that effect (Doc. #40).

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relief from that order, pursuant to Rule 60(b)(1) of the Federal

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Rules of Civil Procedure (“FRCP”).

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the Court “may relieve a party or its legal representative from a

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final judgment, order, or proceeding for . . . mistake,

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inadvertence, surprise, or excusable neglect.”

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60(b)(1).

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reply brief, with regard to Plaintiffs’ motion for the issuance

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of a new summons, was excusable neglect due to an email

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malfunction, which caused him to be unaware that Defendant had

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filed an opposition.

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appear at the hearing in his motion, but does discuss it briefly

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it in his attached declaration.

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Plaintiffs now request

Rule 60(b)(1) provides that

Fed. R. Civ. P.

Mr. Dwyer argues that his failure to file a timely

Mr. Dwyer does not address his failure to

The Ninth Circuit has held that, in determining “whether a

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party’s failure to meet a deadline constitutes ‘excusable

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neglect,’ courts must apply a four-factor equitable test,

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This motion was determined to be suitable for decision without
oral argument. E.D. Cal. L.R. 230(g). The hearing was
scheduled for October 1, 2014.
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examining: (1) the danger of prejudice to the opposing party;

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(2) the length of the delay and its potential impact on the

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proceedings; (3) the reason for the delay; and (4) whether the

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movant acted in good faith.”

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624 F.3d 1253, 1261 (9th Cir. 2010).

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Ahanchian v. Xenon Pictures, Inc.,

Here, the first and second Ahanchian factors weigh slightly

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in Plaintiffs’ favor.

The only prejudice complained of by

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Defendant CFLG is delay to the proceedings.

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the case is still in the early stages of discovery, and trial is

Opp. at 3.

However,

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not scheduled until January 2016.

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Plaintiffs’ failure to file a timely reply is minimal and will

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have no meaningful effect on the proceedings.

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The delay caused by

The third Ahanchian factor is dispositive.

The purported

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reason for the delay is the failure of Mr. Dwyer’s email service.

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The “CM/ECF Final Procedures” published on the Eastern District

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of California’s website indicate that technological failures do

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not constitute excusable neglect.

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provides that “[p]roblems on the filer’s end, such as phone line

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problems, problems with the filer’s Internet Service Provider

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(ISP), or hardware or software problems, will not . . . excuse an

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untimely filing.”

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E.D.C.A.(available at: http://www.caed.uscourts.gov/caed/

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DOCUMENTS/CMECF/ CMECFFinalProcedures.pdf). Plaintiffs’ counsel

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also had independent means of monitoring the docket for relevant

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filings, even in the absence of email notifications from CM/ECF.

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As the hearing date approached, he could simply have logged into

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CM/ECF and checked the docket for an opposition.

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Mr. Dwyer’s failure to appear at the August 20, 2014 hearing is

Specifically, Procedure 6.20

CM/ECF Final Procedures, U.S. District Court,

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Furthermore,

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unrelated to the email malfunction.

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against Plaintiffs.

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This factor weighs heavily

As for the fourth Ahanchian factor, Defendant’s argument

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that Plaintiffs acted in bad faith is not well taken.

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has included an affidavit from his email service provider

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explaining the lapse in service, and there is no indication that

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he has attempted to mislead the Court.

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in bad faith.

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Mr. Dwyer

Not all mistakes are made

Nevertheless, upon weighing the four factor Ahanchian test,

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the Court concludes that Plaintiff’s failure to file a timely

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reply does not constitute excusable neglect and, therefore,

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Plaintiff’s motion for relief under Rule 60(b)(1) from the

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Court’s August 25, 2014 order is DENIED.

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II.

ORDER TO SHOW CAUSE

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Defendant’s Opposition contains the following argument:

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“The Ninth Circuit has already heard a case alleging
email problems as a basis for excusable neglect.
Engleson v. Burlington N. R. Co., 972 F.2d 1038, 1043
(9th Cir. 1992). There, as here, the email problems
occurred approximately two weeks prior to the ruling on
the motion before the court. Ibid. The court held
that counsel’s gamble on whether the matter would
proceed was not excusable neglect. Ibid. Counsel had
every opportunity to follow up and see if the matter
would proceed.”

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Opp. at 4 (citing Engleson v. Burlington N. R. Co., 972 F.2d

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1038, 1043 (9th Cir. 1992)).

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Court is perplexed as to why Defendant cited this case as

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authority in support of its opposition given that it does

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not concern “email problems as a basis for excusable

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neglect.”

Opp. at 4.

Upon reviewing Engleson, the

Engleson stands for none of the
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propositions for which it is cited by Defendant.

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Defendant’s attorney, Jody L. Winter, is ordered to show

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good cause as to why sanctions should not be imposed for his

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apparent attempt to present to this Court a pleading

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containing legal contentions not warranted by existing law.

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See Federal Rule of Civil Procedure 11(b)(2).

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III.

ORDER

For the reasons set forth above, the Court DENIES
Plaintiffs’ Motion for Relief from Judgment. The Court further

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orders that Mr. Winter show cause as to why he should not be

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sanctioned.

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this order within ten (10) days of its filing.

Mr. Winter shall file a declaration in response to

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IT IS SO ORDERED.

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Dated: October 9, 2014

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