Securities and Exchange Commission v. Radius Capital Corp. et al
OPINION AND ORDER denying 405 Motion for Reconsideration. Signed by Judge John E. Steele on 8/11/2017. (RKR)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
Case No: 2:11-cv-116-FtM-29MRM
RADIUS CAPITAL CORP.
ROBERT A. DIGIORGIO,
OPINION AND ORDER
This matter comes before the Court on defendant Robert A.
Digiorgio’s Motion for Reconsideration of Opinion and Judgment of
Dkt 386 Based on New Opinion of 11th Circuit (Doc. #405) filed on
October 12, 2016.
The Securities and Exchange Commission (SEC)
Reconsideration of Judgment (Doc. #406), and defendant filed a
Reply (Doc. #407) without leave of Court 1.
On February 6, 2014, a jury found in favor of the SEC and
against defendant on all claims.
On April 20, 2015,
defendants 2, and finding defendants jointly and severally liable
See M.D. Fla. R. 3.01(c). Although leave of Court to reply
was not obtained prior to its filing, the Court will accept and
consider the Reply.
The Injunction (Doc. #387) was issued under separate cover
on the same day.
for disgorgement in excess of $1.4 million, plus pre-judgment
interest from November 1, 2006, and a civil penalty in excess of
Defendant appealed the final orders.
On June 27, 2016, defendant filed an Amended Counter Reply on
Appeal, and on June 29, 2016, the Eleventh Circuit affirmed all
A Petition for Rehearing and
Suggestion for Rehearing En Banc filed on August 10, 2016 was
(See COA Dkt. #15-12004-GG.)
Defendant did not raise the
statute of limitations issue on appeal in the first instance, nor
did he seek to add the issue on appeal based on Graham 3 while still
On September 1, 2016, after the Eleventh Circuit affirmed but
before a mandate had issued, the Court denied defendant’s Motion
for Reconsideration of Opinion and Judgment of Dkt 386 Based on
New Opinion of 11th Circuit (Doc. #399) because defendant sought
reconsideration more than a year after the decision, and more
specifically because he did so before the Eleventh Circuit had
issued a mandate on appeal.
The Eleventh Circuit issued the
Mandate on October 7, 2016, and defendant renewed the request for
SEC v. Graham, 823 F.3d 1357 (11th Cir. 2016).
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A non-final order may be revised at any time before the entry
of a final judgment.
Fed. R. Civ. P. 54(b).
“The courts have
delineated three major grounds justifying reconsideration: (1) an
intervening change in controlling law; (2) the availability of new
evidence; (3) the need to correct clear error or prevent manifest
Sussman v. Salem, Saxon & Nielsen, P.A., 153 F.R.D.
689, 694 (M.D. Fla. 1994) (citations omitted).
In this case, a
final decision had issued and there was no “intervening change” in
the law because Graham was issued more than one year after the
final Opinion and Order determining disgorgement.
As a result,
defendant cannot seek reconsideration on this basis.
“[T]he findings of fact and conclusions of law by an appellate
court are generally binding in all subsequent proceedings in the
same case in the trial court or on a later appeal.”
SEC v. Lauer,
610 F. App'x 813, 817 (11th Cir. 2015) (citation omitted) (emphasis
Although a district court may address issues not disposed
Underwriters, 430 F.3d 1326, 1331 (11th Cir. 2005), it is also
“clear that Rule 60(b) may not be used to challenge mistakes of
law which could have been raised on direct appeal,” Am. Bankers
Ins. Co. of Florida v. Nw. Nat. Ins. Co., 198 F.3d 1332, 1338 (11th
Cir. 1999) (citation omitted).
In this case, Graham was decided
while defendant was still before the Eleventh Circuit.
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the issue is precluded by defendant’s failure to raise the issue
Rule 60(b) Relief - Generally
For relief from a final judgment or order, the Court may
relieve a party for the reasons listed in Fed. R. Civ. P. 60(b) if
made within a reasonable time, and no more than a year after the
entry of judgment for the first three reasons, including mistake
or excusable neglect, newly discovered evidence, and fraud.
the motion was not filed within a year of the judgment, and this
deadline is jurisdictional 4, defendant’s arguments based on the
first three reasons under Rule 60(b) are rejected.
Defendant argues that the motion is otherwise filed within a
reasonable time of the mandate, and shortly after Graham was
decided, and therefore timely filed.
The other listed bases under
Rule 60(b) are not restricted by the one year limit.
argues that the judgment is void under Rule 60(b)(4), and under
the catchall “any other reason that justifies relief” of Rule
60(b)(6), the disgorgement amount is inconsistent with Graham.
Rule 60(b)(4) - Void Judgment
infirmity that the infirmity may be raised even after the judgment
United Student Aid Funds, Inc. v. Espinosa, 559
Tundell v. Merck & Co., No. 3:06CV375/MCR/MD, 2008 WL
2385508, at *1 n.4 (N.D. Fla. June 9, 2008).
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U.S. 260, 270 (2010).
A judgment is not “void” simply because it
was erroneous, and should be applied “in the rare instance where
a judgment is premised either on a certain type of jurisdictional
error or on a violation of due process that deprives a party of
notice or the opportunity to be heard.”
Espinosa, 559 U.S. at
because the Court did not have jurisdiction for actions prior to
March 7, 2006, as time barred.
(Doc. #407, p. 3.)
reliance on BellSouth 5 is misplaced.
In that case, a statute was
amended after the entry of judgment, but before the decision of
the Eleventh Circuit thus requiring the appellate court to review
the judgment below based on the new version of the law.
was decided while still on appeal, but defendant in this case did
not present the argument to the Eleventh Circuit while he was still
Rather, defendant sought reconsideration before the
The Court finds that defendant is unable to demonstrate that
the judgment is void because, as defendant recognizes, “it was
settled” at the time that the statute of limitations did not apply,
and jurisdiction 6 was therefore present.
“A judicial construction
BellSouth Telecomms., Inc. v. Town of Palm Beach, 252 F.3d
1169, 1178 (11th Cir. 2001).
There is some question as to whether a time bar would even
be jurisdictional, or only an affirmative defense that can be
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of a statute is an authoritative statement of what the statute
meant before as well as after the decision of the case giving rise
to that construction.”
298, 312–13 (1994).
Rivers v. Roadway Exp., Inc., 511 U.S.
The Court’s decision was not overruled, it
would simply be incorrect under the current interpretation of the
The motion will be denied on this basis.
Rule 60(b)(6) - Any Other Reason for Relief
By the use of “other reason”, Rule 60(b)(6) necessarily
precludes from consideration any of the grounds articulated in (1)
through (5) of Rule 60.
(11th Cir. 2013).
Lillo v. Bruhn, 522 F. App'x 508, 509
The purpose of Rule 60(b) is “to do substantial
justice”, but vacating a judgment should not be undertaken lightly,
and is in the “sound discretion of the district court.”
v. Swim-Tech Corp., 722 F.2d 677, 680 (11th Cir. 1984).
60(b)(6), in particular, is considered an “extraordinary remedy”
requiring a showing of “exceptional circumstances”, and extreme
defendant’s argument that the sale of MBS prior to March 2006 was
barred by the five-year statute of limitations under 28 U.S.C. §
2462, and concluded that the SEC was entitled to disgorgement in
waived. Sec. & Exch. Comm'n v. Graham, 823 F.3d 1357, 1360 n.1
(11th Cir. 2016) (citing John R. Sand & Gravel Co. v. United
States, 552 U.S. 130, 133 (2008)).
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the amount of $1,427,095.00.
(Doc. #386, pp. 15-16.)
argues that $399,175.40 7 of the total disgorgement occurred prior
to March 7, 2006, and is now time-barred under § 2462, and Graham’s
extension of the statute of limitations to disgorgement.
Title 28, United States Code, Section 2462,
Except as otherwise provided by Act of
Congress, an action, suit or proceeding for
the enforcement of any civil fine, penalty, or
forfeiture, pecuniary or otherwise, shall not
be entertained unless commenced within five
years from the date when the claim first
accrued if, within the same period, the
offender or the property is found within the
United States in order that proper service may
be made thereon.
28 U.S.C. § 2462.
“Any statute of limitations sought to be applied
against the United States must receive a strict construction in
favor of the Government.”
Sec. & Exch. Comm'n v. Graham, 823 F.3d
1357, 1360 (11th Cir. 2016) (citation omitted).
In Graham, the
Eleventh Circuit found that § 2462 did not apply to the SEC’s claim
for injunctive relief, which was nonpunitive in nature, but did
apply to the declaratory relief sought by the SEC because it was
backwards looking and punitive in nature.
Graham at 1361, 1363.
synonymous with forfeiture, or rather that “forfeiture includes
This amount is based on defendant’s calculations and not
the amounts determined at trial or the admitted exhibits, and
therefore the amount at issue is further disputed.
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disgorgement”, and therefore § 2462’s statute of limitations did
Id. at 1364. 8
On June 5, 2017, the Supreme Court agreed with the position
of the Eleventh Circuit in holding that any claim for disgorgement
is a penalty, and thus under § 2462, the action must be commenced
within five years of the date the claim accrued.
137 S. Ct. 1635, 1639 (2017).
Kokesh v. SEC,
On June 6, 2017, the Court directed
the SEC to file a supplemental memorandum addressing the impact of
Kokesh on this case, and directed that defendant could file a
The SEC filed a Supplemental Memorandum
(Doc. #409), defendant filed a Reply (Doc. #410), and the SEC filed
a Notice of Additional Authority (Doc. #411) relaying a postKokesh decision denying reconsideration, SEC v. Amerindo Inv.
(S.D.N.Y. July 14, 2017).
A change in the decisional law is not an “extraordinary
circumstance” sufficient to invoke Rule 60(b)(6).
Thomas, 739 F.3d 611, 631 (11th Cir. 2014) (citing Gonzalez v.
Crosby, 545 U.S. 524, 536-37 (2005)).
Eleventh Circuit precedent
is clear that a later ruling that is contrary to a ruling that was
correct when it was decided does not constitute an extraordinary
This view differed from the view taken by the District of
Columbia Circuit, First Circuit, and Tenth Circuits. See, e.g.,
Sec. & Exch. Comm'n v. Kokesh, 834 F.3d 1158, 1165 (10th Cir.
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circumstance justifying relief.
Pursuant to Gonzalez and Arthur,
reconsideration must be denied.
Accordingly, it is hereby
Defendant Robert A. Digiorgio's Motion for Reconsideration of
Opinion and Judgment of Dkt 386 Based on New Opinion of 11th
Circuit (Doc. #405) is DENIED.
DONE and ORDERED at Fort Myers, Florida, this
of August, 2017.
Counsel of Record
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