Horowitz et al v Federal Insurance Company

Filing 32

MEMORANDUM OPINION. Signed by Judge Deborah K. Chasanow on 11/22/2017. (sat, Chambers)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
ROBERT HOROWITZ, et al.
:
v.

:

Civil Action No. DKC 15-1959

:
FEDERAL INSURANCE COMPANY
d/b/a Chubb & Son

:

MEMORANDUM OPINION
Presently

pending

and

ready

for

resolution

in

this

insurance case is a motion for relief from judgment filed by
Plaintiffs Robert and Cathy Horowitz (“Plaintiffs”).
26).

(ECF No.

The issues have been fully briefed, and the court now

rules, no hearing being deemed necessary.

Local Rule 105.6.

For the following reasons, the motion for relief from judgment
will be denied.
I.

Background
The factual and procedural background to this case may be

found in the memorandum opinion issued on January 4, 2016.
No. 14, at 1-2).

(ECF

That opinion and an accompanying order granted

a motion to dismiss filed by Defendant Federal Insurance Company
(“Defendant”).

Plaintiffs then filed a motion to alter or amend

the judgment pursuant to Fed.R.Civ.P. 59(e) which was denied on
May 27, 2016.

(ECF No. 19).

Plaintiffs appealed, and the

United States Court of Appeals for the Fourth Circuit affirmed

the dismissal.
a

motion

(ECF No. 24).

for

60(b)(2).

relief

(ECF No. 26).

Plaintiffs replied.
II.

from

judgment

pursuant

to

Fed.R.Civ.P.

Defendant responded, (ECF No. 28), and

(ECF No. 31).

Standard of Review
“The

consideration

of

proceeds in two stages:
the

On May 25, 2017, Plaintiffs filed

movant

has

met

a [Fed.R.Civ.P.]

60(b)

motion

first, the court must assess whether

each

of

three

threshold

conditions;

and

second, if the threshold requirements have been met, the court
must determine whether the movant has satisfied one of the six
enumerated grounds for relief under the rule.”

Holland v. Va.

Lee Co., Inc., 188 F.R.D. 241, 248 (W.D.Va. 1999) (citing Nat’l
Credit Union Admin. Bd. v. Gray, 1 F.3d 262, 264, 266 (4th Cir.
1996).
The threshold requirements are timeliness, a meritorious
claim or defense, and the absence of unfair prejudice to the
other side.

Rule 60(b) allows for a party to move for relief

from a judgment based on one of six grounds including “newly
discovered evidence.”

Fed.R.Civ.P. 60(b)(2).

In determining

whether to exercise the power under Rule 60(b), courts must
engage

in

a

delicate

balancing

of

the

“sanctity

of

final

judgments, expressed in the doctrine of res judicata, and the
incessant command of the court’s conscience that justice be done
in light of ALL the facts.”

Compton v. Alton S.S. Co., 608 F.2d
2

96, 102 (4th Cir. 1979) (emphasis in original) (quoting Banker’s
Mortg. Co. v. United States, 423 F.2d 73, 77 (5th Cir. 1970)).
III. Analysis
A.

Timeliness

Plaintiffs

argue

that

the

motion

for

relief

is

timely

because it was filed within a year of the court’s ruling on its
motion

to

alter

or

amend

the

judgment

and

shortly

after

a

decision in the case between these parties before the Maryland
Insurance

Administration

(“MIA”).

(ECF

No.

26,

at

2-5).

Defendant argues that the motion is late because judgment was
entered more than a year before the motion and, regardless,
Plaintiffs did not file within a reasonable time.

(ECF No. 28,

at 2).
In

this

judgment

case,

pursuant

Plaintiffs
to

filed

Fed.R.Civ.P.

59,

“affect the finality of the judgment.”
committee notes to 1995 amendment.
“suspend[]

the

finality

of

the

a

motion
and

to

Rule

amend
59

the

motions

Fed.R.Civ.P. 59 advisory
A Rule 59 motion acts to

judgment”

until

the

district

court has ruled.

Communist Party of Ind. v. Whitcomb, 414 U.S.

441, 445 (1974).

Thus, a Rule 59 motion tolls the date of final

judgment for the purposes of “the appeals-limitation period.”
Dove v. Codesco, 569 F.2d 807, 809 (4th Cir. 1978).

Other courts

have also held that a Rule 59 motion tolls the date of final
judgment

for

the

purposes

of

subsequent
3

motions

before

the

district court including motions pursuant to Rule 60.

Int’l

Ctr. for Tech. Assessment v. Leavitt, 468 F.Supp.2d 200, 206
(D.D.C. 2007) (“In other words, the suspension of finality on
the

basis

of

a

timely-filed

applicable to an appeal.

Rule

59(e)

motion

is

not

only

Accordingly, the court concludes that

a timely filed Rule 59(e) motion suspends the finality of a
judgment not just at the appellate level, but at the district
court level as well.”).
persuasive,

it

will

Although that ruling is logical and

not

be

necessary

to

rule

definitively

because, even if timely, the motion will be denied on other
grounds.
Rule

60(b)(2)

requires

not

only

that

a

motion

be

made

within a year of final judgment but also that it be filed within
“a reasonable time.”

Plaintiffs claim that their delay was

reasonable because the delay allowed them to incorporate an MIA
decision into their motion.

(ECF No. 26, at 5).

argues the delay was unreasonable.

Defendant

When a party waits for a few

of months to “strengthen the basis for [a] motion”, the delay is
reasonable.

Bouret-Echevarria v. Caribbean Aviation Maintenance

Corp., 784 F.3d 37, 44 (1st Cir. 2015) (finding reasonable a
three

month

delay

used

to

obtain

additional

support a motion pursuant to Rule 60(b)).

information

to

Here, Plaintiffs

delayed six months which allowed for further development in a
related administrative proceeding.
4

This delay is not an example

of a party sleeping on its rights but rather of using additional
time to attempt to improve their case.

Thus, Plaintiffs’ motion

filed shortly after a ruling in the administrative proceeding
was filed within a reasonable time.

See Wells Fargo Bank, N.A.

v. AMH Roman Two NC, LLC, 859 F.3d 295, 300 (4th Cir. 2017).
B.

Prejudice

Plaintiffs allege that setting aside the judgment will not
unfairly prejudice Defendant.
does not dispute this.

(ECF No. 26, at 6).

Defendant

(ECF No. 28).

There does not appear to

be any loss of evidence or witnesses.

See Westlake Legal Group

v. Yelp, Inc. 599 F.App’x 481, 484 (4th Cir. Mar 18, 2015).
Therefore,

Plaintiffs’

motion

does

not

unfairly

prejudice

whether

Plaintiffs

Defendant.
C.

Meritorious Claim or Defense

The

final

threshold

consideration

have a meritorious claim or defense.

is

To satisfy this element,

the movants must make “a proffer of evidence which would permit
a finding for the [moving] party[.]”

Holland v. Va. Lee Co.,

Inc., 188 F.R.D. 241, 249 (W.D.Va. 1999) (alteration in the
original and quoting Augusta Fiberglass Coatings, Inc. v. Fodoc
Contracting Corp., 843 F.2d 808, 812 (4th Cir. 1988)).

In a

motion pursuant to Rule 60(b)(2), the newly discovered evidence
must

call

directly

into

question

refuting

the

“the

validity

underpinning
5

of

of

the

the

judgment
theory

by

which

prevailed.”

11 Charles Alan Wright, Arthur R. Miller, Mary Kay

Kane, Federal Practice & Procedure § 2859 (3d ed. 2017).
Plaintiffs

allege

that

an

exhibit

obtained

in

November

during proceedings before the MIA shows that Defendant paid for
debt collection activities. (ECF No. 26, at 7).
an audit report prepared by Defendant.
identify
debts.
claims

any

affirmative

payments

This exhibit is

The report does not

Defendant

made

to

collect

Indeed, it only identifies the disallowance of certain
for

legal

expenses.

(ECF

No.

26-1,

at

114-17).

The

report is consistent with the reasoning in the original judgment
that Defendant did not engage in debt collection activities,
and,

therefore,

judgment.”

11

it

does

Wright,

not

undermine

supra

§

2859.

the

“validity
Plaintiffs’

of

the

motion

pursuant to Rule 60(b)(2) will be denied.
IV.

Conclusion
For

the

foregoing

reasons,

the

motion

for

relief

from

judgment filed by Plaintiffs Robert and Cathy Horowitz will be
denied.

A separate order will follow.

/s/
DEBORAH K. CHASANOW
United States District Judge

6