Dengler v. Horace Mann Insurance Company

Filing 51

ORDER Denying Plaintiff's Motion To Vacate Judgment re 48 . Signed by JUDGE LESLIE E. KOBAYASHI on 7/10/2019. (cib)

UNITED STATES DISTRICT COURT
DISTRICT OF HAWAII

SHEILA DENGLER, AS NEXT FRIEND
OF B.P.D., A MINOR BORN IN 2000,

CIV. NO. 17-00068 LEK-RLP

Plaintiff,
vs.
HORACE MANN INSURANCE COMPANY,
Defendant.

ORDER DENYING PLAINTIFF’S MOTION TO VACATE JUDGMENT
On February 22, 2018, this Court issued an Order
Granting Defendant’s Motion for Summary Judgment and Denying
Plaintiff’s Counter-Motion for Summary Judgment (“2/22/18
Order”).

[Dkt. no. 39.]

The Judgment in a Civil Case

(“Judgment”) was entered on March 16, 2018.

[Dkt. no. 41.]

Before the Court is Plaintiff Sheila Dengler’s (“Plaintiff”)1
motion to vacate the 2/22/18 Order and the Judgment (“Motion”),
filed on April 5, 2019.

[Dkt. no. 48.]

Defendant Horace Mann

Insurance Company (“Defendant”) filed its statement of no
position on April 18, 2019.

[Dkt. no. 50.]

The Court has

considered the Motion as a non-hearing matter pursuant to Rule
LR7.2(e) of the Local Rules of Practice for the United States

1

Sheila Dengler is pursuing this action as Next Friend of
B.P.D., a minor born in 2000.

District Court for the District of Hawaii (“Local Rules”).
Plaintiff’s Motion is hereby denied for the reasons set forth
below.
BACKGROUND
The relevant factual background is set forth in the
2/22/18 Order and will not be repeated here.

In the 2/22/18

Order, this Court ruled that Defendant was entitled to summary
judgment because the underinsured motorist (“UIM”) benefits in
the four motor vehicle insurance policies that Defendant issued
to Plaintiff and her husband were not subject to stacking.
[2/22/18 Order at 8-9.]
On March 29, 2018, Plaintiff appealed.

[Dkt. no. 42.]

Thereafter, the parties participated in the Ninth Circuit’s
mediation program and ultimately agreed to resolve all claims.
[Mem. in Supp. of Motion at 2-3 (citing Motion, Decl. of
James T. Leavitt, Jr. (“Leavitt Decl.”) ¶¶ 4-5).]

One

settlement term allowed Plaintiff to file a motion to vacate the
2/22/18 Order and required Defendant to file a statement of no
position.

[Leavitt Decl. at ¶ 6.]

On April 3, 2019, the Ninth

Circuit dismissed Plaintiff’s appeal.

[Dkt. no. 47.]

STANDARD
Fed. R. Civ. P. 60 grants a district court the power
to vacate its judgment when appropriate.
pertinent part:
2

Rule 60(b) states in

Grounds for Relief from a Final Judgment, Order,
or Proceeding. On motion and just terms, the
court may relieve a party or its legal
representative from a final judgment, order, or
proceeding for the following reasons:
. . . .
(5) the judgment has been satisfied,
released, or discharged; it is based on an
earlier judgment that has been reversed or
vacated; or applying it prospectively is no
longer equitable; or
(6)

any other reason that justifies relief.

(Emphasis added.2)
In the Ninth Circuit, a district court uses an
“equitable balancing test” to evaluate whether to vacate a
judgment or order after the parties settle.

Am. Games, Inc. v.

Trade Prods., Inc., 142 F.3d 1164, 1168 (9th Cir. 1998).

This

equitable balancing test involves weighing various factors
including: “the consequences and attendant hardships of
dismissal or refusal to dismiss”; “the competing values of
finality of judgment and right to relitigation of unreviewed
disputes”; and “the motives of the party whose voluntary action
mooted the case.”

Id. (citation and internal quotation marks

2

Plaintiff also brings the Motion pursuant to Rule 60(d),
which states: “This rule does not limit a court’s power to:
(1) entertain an independent action to relieve a party from a
judgment, order, or proceeding[.]” However, Rule 60(d)(1) is
inapplicable because Plaintiff did not bring the instant Motion
in an independent action.
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omitted).

In addition, courts should weigh the relevant public

policy considerations.

Id. at 1170.
DISCUSSION

I.

Consequences and Attendant Hardships
No attendant hardships to the parties are alleged if

this Court preserved the 2/22/18 Order.

Instead, Plaintiff

argues the 2/22/18 Order should be vacated because this Court
should support the parties’ settlement.

[Mem. in Supp. of

Motion at 3-4 (citing Ahern v. Central Pacific Freight Lines,
846 F.2d 47, 48 (9th Cir. 1988)).]

“The Ninth Circuit is firmly

committed to the rule that the law favors and encourages
compromise settlements.”

Ahern, 846 F.2d at 48 (citation and

internal quotation marks omitted).

But, the Ninth Circuit has

also stated that “a district court is not required to vacate a
judgment pursuant to settlement because, otherwise, any litigant
dissatisfied with a trial court’s findings would be able to have
them wiped from the books.”

Bates v. Union Oil Co. of Cal., 944

F.2d 647, 650 (9th Cir. 1991) (citation and internal quotation
marks omitted).

Consequently, granting vacatur may deter

settlement before initial judgment because “[s]ome litigants, at
least, may think it worthwhile to roll the dice rather than
settle in the district court.”

U.S. Bancorp Mortg. Co. v.

4

Bonner Mall P’ship, 513 U.S. 18, 28 (1994) (emphasis omitted);3
see also Tumulty v. FedEx Ground Package Sys., Inc., No. C041425P, 2007 WL 896035, at *3 (W.D. Wash. Mar. 22, 2007) (denying
a motion to vacate judgment in part because the losing party
should not have the option to “‘buy an eraser’ for unfavorable
rulings”).

Thus, the parties had the opportunity but failed to

settle before the 2/22/18 Order or the Judgment.

Here,

preserving the incentives of early settlement weighs against
vacatur.
Plaintiff’s argument that Defendant’s acquiescence and
statement of no position should weigh in favor of vacatur is
also unpersuasive.

Unlike in Click Entertainment, Inc. v. JYP

Entertainment Co., Civ. No. 07-00342 ACK-KSC, 2009 WL 3030212,
at *3 (D. Hawai`i Sept. 22, 2009), in which the parties had
filed a joint motion for vacatur, here, Plaintiff is the sole
moving party.

Defendant’s lack of demonstrated support for the

instant Motion weighs against vacatur.

3

The exceptional circumstances test in Bonner Mall does not
apply here because it only applies to appellate courts
considering motions to vacate judgment. Cf. Am. Games, 142 F.3d
at 1168 (“Ninth Circuit decisions after Bonner Mall support the
reading . . . that a district court may vacate its own decision
in the absence of extraordinary circumstances.”). However,
Bonner Mall is still relevant because the case addresses many
policy concerns a district court will consider when evaluating a
motion to vacate judgment upon settlement by the parties.
5

There is also no indication that the parties
conditioned their settlement agreement on the success of the
Motion.

This Court therefore does not find any substantial

hardship to the parties if vacatur is denied.

See Seaboard Sur.

Co. v. Grupo Mexico, S.A. de C.V., No. CV 06-0134-PHX-SMM, 2010
WL 11519172, at *3 (D. Ariz. Nov. 12, 2010) (denying a motion to
vacate judgment in part because the parties did not condition
their settlement agreement upon the success of the motion and
the parties would have settled despite its failure).
II.

Finality of Judgment v. Relitigation of Unreviewed Disputes
Plaintiff argues that finality and relitigation of

unreviewed disputes, as part of the settlement, are not concerns
because she has given up the right to have the 2/22/18 Order and
the Judgment reviewed.

[Mem. in Supp. of Motion at 4 (citing

Click Entertainment, 2009 WL 3030212, at *3).]
argument is misplaced.

Plaintiff’s

In Click Entertainment, post-trial

motions were still pending and the parties had not progressed to
the appellate stage.

2009 WL 3030212, at *1.

In contrast,

here, Plaintiff settled after having filed a Notice of Appeal.
Click Entertainment is factually distinguishable, and its
analysis of the second factor of the equitable balancing test
does not apply to the instant Motion.
Plaintiff also argues Defendant’s voluntary action of
settling should weigh in favor of vacatur because, “‘[i]nsofar
6

as the prevailing party causes [a final judgment] to become
moot . . . , preservation of the district court judgment is
problematic.’”

See Click Entm’t, 2009 WL 3030212 at *3 (some

alterations in Click Entm’t) (quoting Harrison W. Corp. v.
United States, 792 F.2d 1391, 1394 n.2 (9th Cir. 1986)).
argument is outweighed by two policy concerns.

This

First, granting

vacatur would waste the judicial resources used to produce the
Judgment.

See Tumulty, 2007 WL 896035 at *2 (denying a motion

to vacate judgment in part because granting the motion would
“overlook the considerable resources” expended by the district
court); see also Bonner Mall, 513 U.S. at 27 (“To allow a party
who steps off the statutory path to employ the secondary remedy
of vacatur as a refined form of collateral attack on the
judgment would . . . disturb the orderly operation of the
federal judicial system”).

Second, judicial precedent is

valuable to the legal community and is not solely the property
of the litigants.

Bonner Mall, 513 U.S. at 26.

Vacating

judgment would deprive the public of caselaw to guide future
disputes.
III. Other Factors and Summary
There is no evidence that an adverse motive motivated
the settlement in this case.

This factor is therefore neutral.

Finally, there are no additional policy considerations to
consider.

Having weighed all of the relevant factors, no ground
7

exists which justifies granting Plaintiff relief from the
2/22/18 Order and the Judgment.
CONCLUSION
On the basis of the foregoing, Plaintiff’s Motion for
Vacatur of Order Granting Defendant’s Motion for Summary
Judgment and Denying Plaintiff’s Counter-Motion for Summary
Judgment [ECF 39] Filed February 22, 2018 and Final Judgment
[ECF 41] Filed March 16, 2018, filed April 5, 2019, is HEREBY
DENIED.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAI`I, July 10, 2019.

SHEILA DENGLER, AS NEXT OF FRIEND OF B.P.D., A MINOR BORN IN
2000 VS. HORACE MANN INSURANCE COMPANY; CV 17-00068 LEK-RLP;
ORDER DENYING PLAINTIFF'S MOTION TO VACATE JUDGMENT

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