Sylver v. Mathis et al

Filing 44

ORDER denying Plaintiff's 39 Motion to Set Aside. Signed by Judge Roger L. Hunt on 5/30/12. (Copies have been distributed pursuant to the NEF - ECS)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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***

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MARSHALL SYLVER, individually,

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Plaintiff,
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vs.
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MARGARET MATHIS, individually and as a )
partner of the MATHIS FAMILY LIMITED
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PARTNERSHIP; HAROLD MATHIS, JR.,
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individually and as a partner of the MATHIS
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FAMILY LIMITED PARTNERSHIP; DOE
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DEFENDANTS I through X, inclusive; and
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ROE CORPORATIONS I through X, inclusive, )
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Defendants.
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_______________________________________)

Case No.: 2:09-cv-00855-RLH-LRL
ORDER
(Motion to Set Aside–#39)

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Before the Court is Plaintiff Marshall Sylver’s Motion to Set Aside Judgment

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(#39, filed Apr. 20, 2012) based on his prior attorney’s gross and inexcusable neglect. The Court

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has also considered Defendants Margaret and Harold Mathis’ Opposition (#40, filed May 7), and

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Sylver’s Reply (#43, filed May 17).

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AO 72
(Rev. 8/82)

BACKGROUND
This dispute arises from a loan that Sylver made to Defendants’ son Benjamin in
late June 2007. Sylver contends that he relied on certain financial statements that Defendants sent
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to Benjamin so that Benjamin could prove his financial ability to repay the loan. Benjamin,

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however, never repaid the loan and filed for bankruptcy in October.

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Subsequent to Benjamin filing for bankruptcy, Sylver filed suit against Defendants

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in the Eighth Judicial District Court of the State of Nevada alleging claims for (1) fraud; (2) fraud

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in the inducement; (3) racketeering under NRS § 207.470; (4) negligent misrepresentation; (5)

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damages; (6) punitive and exemplary damages; (7) attorney fees, litigation expenses, and court

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costs; and (8) pre-judgment and post-judgment interest. Defendants then timely removed the case

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to this Court based on diversity jurisdiction. On October 27, 2010, Defendants filed a motion for

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summary judgment. Sylver’s then counsel, Matthew Q. Callister, opposed the motion and attached

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a financial statement Margaret Mathis sent Benjamin after Sylver had made the loan at issue in this

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dispute. The Court ordered supplemental briefing on the issue of when the financial statement was

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sent and when the loan was made. Defendants filed a supplemental brief, however Callister did

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not. The Court, then, granted summary judgment in Defendants favor.

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Sylver has now filed a motion to set aside the court’s entry of judgment claiming

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that Callister was grossly negligent in opposing the motion for summary judgment and abandoning

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his client. Sylver claims that Callister never informed his client of the pending motion for

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summary judgment or discussed how to oppose it, never obtained a declaration from Sylver which

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may have demonstrated a material question of fact to defeat summary judgment, and never

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informed Sylver after the grant of summary judgment that summary judgment had been entered in

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this case. Sylver apparently had to seek out another attorney to review PACER records to discover

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that his case had been dismissed because Callister ceased responding to Sylver’s efforts to contact

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him. Sylver also contends that had Callister sought more discovery or presented evidence that was

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available to him, the Court would not have granted summary judgment, but rather would have

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proceeded to trial. Despite these arguments and for the reasons discussed below, the Court denies

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Sylver’s motion.

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/

AO 72
(Rev. 8/82)

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DISCUSSION
I.

Standard

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Although not mentioned in the Federal Rules of Civil Procedure, motions for

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reconsideration may be brought under Rules 59(e) and 60(b). Under Rule 60(b), a court may

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relieve a party from a final judgment, order or proceeding only in the following circumstances: (1)

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mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence; (3) fraud; (4)

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the judgment is void; (5) the judgment has been satisfied; or (6) any other reason justifying relief

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from the judgment. Stewart v. Dupnik, 243 F.3d 549, 549 (9th Cir. 2000). See also De Saracho

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v. Custom Food Mach., Inc., 206 F.3d 874, 880 (9th Cir. 2000) (noting that the district court’s

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denial of a Rule 60(b) motion is reviewed for an abuse of discretion). “[W]here the client has

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demonstrated gross negligence on the part of his counsel, a default judgment against the client may

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be set aside pursuant to Rule 60(b)(6).” Comty. Dental Servs. v. Tani, 282 F.3d 1164, 1169 (9th

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Cir. 2002).

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II.

Analysis

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Sylver argues that the summary judgment entered against him is more akin to a

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default judgment than an actual decision on the merits of his case because Callister effectively

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abandoned him. To support this argument Sylver claims that Callister should not have relied on

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the evidence he did in opposing the motion for summary judgment. Rather, Sylver argues Callister

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should have presented the Court with two financial statements Benjamin Mathis sent Sylver prior

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to Sylver extending the loan. To support the relevance of these financial statements, Sylver states

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in his declaration that he had requested these documents from Benjamin over the phone and that

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Benjamin obtained them from his mother, Margaret Mathis. (Dkt. #39, Ex. 1, Decl. of Marshall

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Sylver, ¶ 7.) Specifically, while on the phone with Benjamin, Sylver testified that he heard

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Benjamin say “Mom, I just need our current family partnership statements for a deal I’m doing,”

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and asking her to fax them to him. (Id.) Sylver later received two financial statements from

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Benjamin which Benjamin has since admitted to having forged. (Id., Ex. 7, Depo. of Benjamin

AO 72
(Rev. 8/82)

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Mathis 128:8-129:24.) Sylver also argues that Callister should have presented evidence that the

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Mathises had loaned over $5,000,000 to their son over the prior fourteen months which would

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have shown that the Mathises knew their son was gambling and in trouble with debts and

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complicit in defrauding his creditors. The Court disagrees with Sylver’s arguments.

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The summary judgment entered against Sylver was not akin to a default judgment

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and, thus, the Court need not set aside the judgment. First, even assuming that Callister had

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presented the Court with the evidence Sylver now presents, the Court would have granted

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summary judgment. Sylver’s testimony as to what Benjamin said on the phone is hearsay and is

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not actual evidence that Margaret Mathis was on the other line or that Margaret Mathis faxed her

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son the financial statements Sylver purportedly relied upon. This evidence does not create a

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genuine issue of material fact as to whether the Mathises defrauded Sylver, just as to what

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Benjamin did. Second, the Court fails to see how evidence of the Mathises giving or loaning their

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son millions of dollars prior to Sylver’s loan is evidence that the Mathises defrauded Sylver.

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Finally, even assuming one of these two issues may have created a genuine issue of

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material fact, Callister’s (theoretically) faulty opposition to the motion for summary judgment does

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not rise to the grossly negligent level required for Rule 60(b)(6) relief. The cases Sylver cites (that

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don’t deal with an actual default judgment) dealt with attorneys who entirely failed to oppose

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motions and failed to appear at mandatory court proceedings. See, e.g., Spates-More v.

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Henderson, 305 F. Appx. 449 (9th Cir. 2008). Here, Callister did oppose the motion, just in a way

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Sylver disagrees with and that may have been negligent. The Court then granted summary

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judgment on the merits, not because Callister failed to file an opposition. Thus, these

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circumstances are not the “extraordinary circumstances” required by Rule 60(b)(6).1 Accordingly,

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the Court denies the motion.

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AO 72
(Rev. 8/82)

The Court notes that Sylver may still file a complaint with the State Bar and file an action for
malpractice against Callister.

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CONCLUSION

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Accordingly, and for good cause appearing,

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IT IS HEREBY ORDERED that Sylver’s Motion to Set Aside (#39) is DENIED.

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Dated: May 30, 2012.

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____________________________________
ROGER L. HUNT
United States District Judge

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AO 72
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