GILL et al v. HARTSHORN et al
Filing
331
ORDER denying 317 Motion to Vacate; finding as moot 318 Motion for Sanctions; granting 330 Motion for Leave to File Supplemental Authority. Ordered by US DISTRICT JUDGE CLAY D LAND on 11/10/2015. (CGC)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
COLUMBUS DIVISION
DANIEL VAN GASKEN,
*
Plaintiff,
*
vs.
*
LOREN GILL and ELM LEASING,
LLC,
*
CASE NO. 4:12-CV-77 (CDL)
*
Defendants.
*
O R D E R
Defendants Loren Gill and Elm Leasing, LLC seek to vacate
the judgment entered against them based on Plaintiff Dan Van
Gasken’s
failure
to
available
to
Gasken
Van
evidence
was
control,
would
disclose
cumulative
likely
prior
to
not
relevant
to
other
have
the
trial.
evidence
made
evidence
any
that
was
Because
that
within
Defendants’
difference
in
the
outcome of the trial, and because there is no evidence that Van
Gasken purposefully withheld the evidence in an attempt to gain
an advantage in the litigation, the Court denies Defendants’
motion to vacate the judgment (ECF No. 317) and for sanctions
(ECF No. 318).
BACKGROUND
A
jury
determined
that
Defendants
unlawfully
took
money
that belonged to Van Gasken in his capacity as the trustee for
multiple trusts that benefitted a trust known as the Gill Family
Cornerstone Trust.
Based on the jury verdict, the Clerk of
Court entered judgment in favor of Van Gasken and against Loren
Gill and Elm Leasing.
Gasken,
as
trustee
One of the central issues was whether Van
for
real
estate
holding
trusts
whose
beneficiary was the Cornerstone Trust, authorized payments of
trust
income
Leasing.
to
pay
for
properties
that
were
titled
to
Elm
It was undisputed that certain properties were titled
to Elm Leasing, that funds from real estate holding trusts were
used to pay for those properties, and that trustee Van Gasken
knew that trust money was used to pay for the properties.
the parties stipulated that Loren Gill owned Elm Leasing.1
And,
Van
Gasken asserted, however, that Loren Gill and his brother John
Gill fraudulently concealed the ownership of Elm Leasing and led
Van Gasken to believe that Elm Leasing was owned by a trust that
benefitted the Cornerstone Trust rather than owned by Loren Gill
personally.
See, e.g., Gill v. Gill, No. 4:12-cv-77 (CDL), 2015
WL 631991, at *6 (M.D. Ga. Feb. 13, 2015).
He also asserted
that he would not have authorized the transfers if he had known
that Loren Gill owned Elm Leasing.
The jury found in favor of
Van Gasken.
1
In a prior action, Loren Gill presented documentary evidence that he
is the sole member of Elm Leasing with all rights of ownership, and
Van Gasken did not present any evidence to rebut it.
E. Prop. Dev.
LLC v. Gill, No. 4:11-CV-62 (CDL), 2012 WL 1424664, at *3 (M.D. Ga.
Apr. 24, 2012).
The Court thus determined that Loren Gill is the
owner of Elm Leasing, LLC. Id. at *3-*4.
2
The
present
dispute
that
is
the
subject
of
Defendants’
motions relates to when Van Gasken knew that Loren Gill was
asserting ownership of Elm Leasing.
Van Gasken asserts that he
did not find out until the 2011 litigation that Loren Gill was
claiming sole ownership of Elm Leasing.2
Defendants contend,
however, that they have now discovered “smoking gun” evidence
proving that Van Gasken knew that Loren Gill was the owner of
Elm
Leasing
before
litigation
began
in
the
summer
of
2011.3
During discovery in a state court action, Van Gasken produced
several
emails
in
response
to
a
request
for
communications
between him and others on various topics:
a.
September 2, 2009 Email.
An attorney wrote that he was
“advised by Mr. VanGasken, that Loren Gill, Member of Elm
Leasing, LLC” would convey certain proceeds to an entity
called Surety Corporation of America. Kunkes Decl. Ex. 4,
Email from Mike Joyner to Jacob Beil (cc: Dan Van Gasken),
Sept. 2, 2009, ECF No. 317-3 at 60.
2
Van Gasken still does not believe that Loren Gill is the sole owner
of Elm Leasing. Rather, he contends that John Gill set up Elm Leasing
so that Loren Gill would be the member manager, with no rights of
ownership. Van Gasken acknowledges, however, that he did not present
any evidence to rebut Loren Gill’s documentary evidence when Loren
Gill moved for summary judgment on the ownership issue in a prior
action.
3
Defendants contend that based on this evidence, it is clear that Van
Gasken’s claims are time-barred and that he authorized the transfers
from the real estate holding trusts despite knowing that Loren Gill
owned Elm Leasing.
3
b.
September
3,
2009
Email.
Van
Gasken
September 2, 2009 Email to Russell.
forwarded
the
Kunkes Decl. Ex. 5,
Email from Dan Van Gasken to russell@bailbonds.com, Sept.
3, 2009, ECF No. 317-3 at 62.
c.
December 8, 2010 Email.
that
property
Van Gasken sent an email stating
titles
to
certain
properties
Corporations and should go to trusts.”
“are
in
Kunkes Decl. Ex. 6,
Email from Dan Van Gasken to Jay Nicol et al., Dec. 8,
2010,
ECF
“Several
No.
317-3
properties
at
are
(Loren Gill, member).”
64.
The
titled
email
under
further
Elm
states:
Leasing,
LLC
Id., ECF No. 317-3 at 65.
Van Gasken did not produce these emails during discovery in
this case.4
During discovery in this case, Defendants requested
all documents which pertain to or relate to Van Gasken’s claims
in this action.
Van Gasken testified that he did not produce
the emails in response to this request because by the time he
filed
his
conversion
claim
and
received
a
request
for
all
documents related to that claim, the Court had already decided
4
When counsel for Loren Gill and Elm Leasing asked Van Gasken during a
2011 deposition if he had located any documents that had to do with
the ownership of Elm Leasing, Van Gasken answered that he had not.
Defendants contend that this testimony was a deliberate lie.
But at
the hearing on Defendants’ motion to vacate, Van Gasken explained that
he looked for trust documents in his paper files to show ownership of
Elm Leasing. Neither his own counsel nor counsel for Defendants asked
him to do an electronic search of his email on the ownership of Elm
Leasing, so he did not do so prior to the deposition. Based on this
testimony, the Court cannot conclude that Van Gasken lied in response
to the specific question he was asked during the 2011 deposition.
4
as a matter of law that Loren Gill was the sole owner of Elm
Leasing.
Van
Gasken
business
model,
the
also
testified
word
that
“member”
does
under
not
John
mean
Gill’s
“owner.”
Rather, it simply means manager, so emails referring to Loren
Gill as member of Elm Leasing do not establish that Van Gasken
knew
that
Loren
Gill
was
the
sole
owner
of
Elm
Leasing.
Finally, Van Gasken testified that he did not know that Loren
Gill was claiming sole ownership of Elm Leasing until the prior
litigation began in the summer of 2011.
DISCUSSION
Loren Gill and Elm Leasing seek to vacate portions of the
judgment
under
60(b)(3).
I.
Federal
Rule
of
Civil
Procedure
60(b)(2)
and
The Court addresses each issue in turn.
Rule 60(b)(2) Analysis
Under Federal Rule of Civil Procedure 60(b)(2), the Court
may
relieve
a
party
from
a
final
judgment
based
on
“newly
discovered evidence that, with reasonable diligence, could not
have been discovered in time to move for a new trial under Rule
59(b).”
“For
the
court
to
grant
relief
based
upon
newly
discovered evidence under Rule 60(b)(2), a movant must meet a
five-part test: (1) the evidence must be newly discovered since
the
trial;
(2)
due
diligence
on
the
part
of
the
movant
to
discover the new evidence must be shown; (3) the evidence must
not be merely cumulative or impeaching; (4) the evidence must be
5
material; and (5) the evidence must be such that a new trial
would probably produce a new result.”
Waddell v. Hendry Cty.
Sheriff's Office, 329 F.3d 1300, 1309 (11th Cir. 2003).
Van Gasken does not dispute that the three emails were
newly discovered after the trial, and he does not dispute that
the evidence is material.
Van Gasken argues that Defendants had
within their control evidence similar to the type of evidence
that they now claim warrants the drastic remedy of vacating a
judgment after a jury verdict, and yet they did not use that
evidence during the trial.
That evidence included an email from
Van Gasken to Loren Gill requesting that Gill execute a document
regarding a lease that listed Elm Leasing, LLC as the lessor and
thus owner of the property.
That lease included a signature
line where Loren Gill signed the lease on behalf of Elm Leasing,
LLC as “Member.”
Van Gasken Decl. Ex. P, Email from Dan Van
Gasken to Loren Gill, Apr. 11, 2011, ECF No. 320-1 at 348, 355.
These documents were obviously available to Loren Gill and could
have been produced during the trial and used to impeach Van
Gasken regarding his contention that he did not believe Loren
Gill was the “owner” of Elm Leasing, LLC.
merely cumulative of this evidence.
The other emails were
Defendants maintain that
they were unaware that this email regarding the lease existed at
the time of trial.
But it is clear that it could have easily
been discovered through due diligence.
6
It was sent to Defendant
Loren Gill, and Defendants gave no reason why it could not have
been discovered in his electronic database.
Furthermore, the
lease that listed Loren Gill as the “Member” of Elm Leasing, LLC
related to the most valuable asset to which Elm Leasing held
title.
Certainly, Loren Gill had a copy of that lease.
The Court further finds that a new trial would probably not
produce a new result even if Defendants were able to present the
three emails that they contend Van Gaksen withheld.
contend that the
evidence would likely
Defendants
produce a new result
because (1) the emails foreclose Van Gasken’s argument that the
transactions
were
unauthorized,
and
(2)
the
emails
that Van Gasken’s conversion claim is time-barred.
disagrees on both points.
establish
The Court
First, the emails do not prove that
Van Gasken knew Loren Gill was the sole owner of Elm Leasing.
Rather, they simply establish that he knew Loren Gill was a
member of Elm Leasing, and Van Gasken explained that “member”
does not mean “owner” under John Gill’s business model.
Van
Gasken consistently took the position that he never believed Elm
Leasing, LLC was the owner of the properties that were titled in
the name of Elm Leasing, LLC because he knew that the trusts,
and not Elm Leasing, LLC, provided the funds to purchase those
properties.
He never disputed that Loren Gill was a “member” of
Elm Leasing, but he believed that to mean that Loren Gill simply
acted as a manager for Elm Leasing and that Elm Leasing never
7
had legal title to the properties purchased with trust funds.
Second, the emails do not establish that Van Gasken’s conversion
claim was time-barred.
November 12, 2012.
Van Gasken filed his conversion claim on
The statute of limitations for conversion
claims is four years.
O.C.G.A. § 9-3-32.
Thus, if the emails
established that Van Gasken knew that Loren Gill was the sole
owner of Elm Leasing before November 12, 2008, then they might
produce a new result.
But the emails only establish that Van
Gasken knew in 2009 that Loren Gill was a member of Elm Leasing.
For all of these reasons, the Court finds that Loren Gill and
Elm Leasing are not entitled to relief under Rule 60(b)(2).
II.
Rule 60(b)(3) Analysis
Federal Rule of Civil Procedure 60(b)(3) states that the
Court
may
relieve
a
party
from
a
final
judgment
based
on
“fraud[,] . . . misrepresentation, or misconduct by an opposing
party.”
“One who asserts that an adverse party has obtained a
verdict through fraud, misrepresentation or other misconduct has
the burden of proving the assertion by clear and convincing
evidence.”
Rozier v. Ford Motor Co., 573 F.2d 1332, 1339 (5th
Cir. 1978); accord Cox Nuclear Pharmacy, Inc. v. CTI, Inc., 478
F.3d 1303, 1314 (11th Cir. 2007).
“The conduct complained of
must be such as prevented the losing party from fully and fairly
presenting his case or defense.”
Rozier, 573 F.2d at 1339;
accord
The
Cox,
478
F.3d
at
1314.
8
conduct
must
also
be
intentional, not merely an oversight.
See, e.g., Suite 225,
Inc. v. Lantana Ins. Ltd., No. 14-14545, 2015 WL 5147718, at *5
(11th Cir. Sept. 2, 2015) (per curiam) (affirming grant of Rule
60(b)(3)
motion
where
the
plaintiff
made
intentional
misrepresentations to the defendant and the court).
“Although
Rule 60(b)(3) applies to misconduct in withholding information
called
for
by
discovery[,]
it
does
not
require
that
the
information withheld be of such nature as to alter the result in
the case.”
Rozier, 573 F.2d at 1339 (citation omitted).
Rule
60(b)(3) “is aimed at judgments which were unfairly obtained,
not at those which are factually incorrect.”
Id.
For example, relief under Rule 60(b)(3) was warranted in
Rozier, where the defendant intentionally withheld a trend cost
estimate that was responsive to the plaintiff’s interrogatories
and relevant to the plaintiff’s claims.
Id. at 1341.
And in
Suite 225, relief under Rule 60(b)(3) was warranted because the
plaintiff intentionally withheld documents that were unfavorable
to
his
claim.
however,
the
Suite
Court
225,
is
not
2015
WL
5147718,
convinced
that
at
*5.
Here,
Defendants
have
established by clear and convincing evidence that Van Gasken
engaged in intentional misconduct
the
three
remembered
emails.
sending
There
or
is
by deliberately withholding
no
receiving
purposefully failed to produce them.
9
evidence
the
that
three
Van
Gasken
emails
and
Furthermore, Van Gasken
testified that he did not search his electronic records related
to the ownership of Elm Leasing because the Court had already
decided the issue.
Indeed, by the time Van Gasken filed his
claims and received the discovery requests in this action, the
Court had concluded that Loren Gill was the sole owner of Elm
Leasing.
this
And by trial, the parties entered a stipulation on
point.
Gasken’s
search
For
these
reasons,
a
position
could
conclude
that
his
electronic
records
ownership of Elm Leasing.
for
reasonable
there
evidence
person
was
no
in
need
regarding
Van
to
the
Having heard Van Gasken’s explanation
at the hearing on these motions, the Court cannot conclude that
he
intentionally
withheld
these
emails
gaining an advantage in this litigation.
for
the
purpose
of
Defendants have simply
failed to meet their burden of proving by clear and convincing
evidence that Van Gasken engaged in intentional conduct that
warrants relief under Rule 60(b)(3).5
5
Defendants filed a motion for leave to file supplemental authority
regarding the correct standard under Rule 60(b)(3). That motion (ECF
No. 330) is granted, but it does not change the Court’s conclusion.
In their supplemental brief, Defendants pointed the Court to Simoneaux
v. E.I. du Pont de Nemours & Co., No. CIV.A. 12-219-SDD, 2015 WL
3905069 (M.D. La. June 25, 2015), which emphasized—as Rozier did—that
relief under Rule 60(b)(3) does not require a showing that the outcome
of the trial would have been different if newly discovered evidence
had been produced during discovery.
In Simoneaux, as in Rozier, the
newly
discovered
evidence
was
called
for
in
discovery
but
intentionally withheld by the defendant. Simoneaux, 2015 WL 3905069,
at *4.
In contrast, here, Defendants did not prove by clear and
convincing evidence that Van Gasken engaged in intentional conduct
that warrants relief under Rule 60(b)(3).
10
CONCLUSION
For
the
reasons
set
forth
above,
Defendants’ Motion to Vacate (ECF No. 317).
the
Court
denies
In light of the
Court’s denial of Defendants’ motion to vacate, the Court finds
Defendants’ Motion for Sanctions (ECF No. 318) moot.
IT IS SO ORDERED, this 10th day of November, 2015.
S/Clay D. Land
CLAY D. LAND
CHIEF U.S. DISTRICT COURT JUDGE
MIDDLE DISTRICT OF GEORGIA
11
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