Payne et al v. Tri-State Careflight, LLC et al
Filing
227
MEMORANDUM OPINION AND ORDER denying 200 MOTION to Alter Judgment by District Judge James O. Browning. (vv)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
WILLIAM D. PAYNE; NICOLE PAYNE;
LESLIE B. BENSON; KEITH BASTIAN;
JACQUELINE FERNANDEZ-QUEZADA;
CASON N. HEARD; GREGORY OLDHAM
AND SHERRY K. WELCH, on behalf of
themselves and all others similarly situated,
Plaintiffs,
vs.
No. CIV 14-1044 JB\KBM
TRI-STATE CAREFLIGHT, LLC and BLAKE
A. STAMPER,
Defendants.
Consolidated with:
KRISTY BELL; DEBORAH BEREST;
DANIEL BERGMAN; WILLIAM
DALLAS BUNDRANT, JR; ROCKY H.
BURROWS, II; CHASE CARTER;
BRENDA CASAREZ; KARA
CERVANTES; THOMAS CISLO; DAVID
DANIELS; ADAM DOYLE; DARREN
EEN; TOBY EICHER; LON ENOS;
WALTER FABIAN; HAROLD JOSEPH
FISHER; CHRISTINA FLEEMAN; LUKE
FORSLUND; SALUSTIANO FRAGOSO;
REHANNON GONZALES; KRISTEN
GRADO; COURTNEY GUERRA;
DARRIN HAMILTON; ALEXANDER
HOWELL; DANIELLE IRVIN; ALLEN
JACOBS; ALEX JONES; DONALD LUKE
KEENAN; DANIEL KUHLER; SIMON
LUCERO; RAPHAEL MAHAIM;
NATHAN MAPLESDEN; ORLANDO
MARQUEZ; CINDY D. MAXWELL;
JENNIFER MAZZANTI; BETHANY
MCCANDLESS; WILLIAM J.
MCCONNELL; DAN MEEHAN; KEVIN
NAPP; JAMES O’CONNOR; KATHY
ONSUREZ-WILSON; ERIC PARKER;
JASON PERRY; AMANDA PETERSEN;
BRENT PLACE; JIMMY RONALD
PRIMM, JR; PHILIP QUBAIN; PAUL
RATIGAN; JOSEPH ROOT; DARON
RUCKMAN; FREDERIC RUEBUSH;
JENNIFER SALAVERRY; LAUREN
SALAZAR; PAUL SERINO; CHRISTIAN
SPEAKMAN; DANIEL ST. PETERS; IAN
STEPHENS; USVALDO R. TRUJILLO;
PAUL VACULA; GRACIELA
VILLALOBOS; ERIC VOGT; GREG
WALSH; TYLER WILKINS; VIRGINIA
WILLIAMS; SARA YURKOVICH;
TERRY ZACHARIAS and MICHAEL
ZULASKI,
Plaintiffs,
vs.
No. CIV 17-0796 JB\CG
TRI-STATE CAREFLIGHT, LLC and BLAKE
A. STAMPER,
Defendants.
MEMORANDUM OPINION AND ORDER
THIS MATTER comes before the Court on Plaintiffs’ Motion to Address Issue of Fed.
R. Civ. P. 60 for Intervenors to Proceed with Third Amended Complaint or, Alternatively Fed. R.
Civ. P. 60(B) Motion to Obtain Relief from Final Judgment, filed August 3, 2018
(Doc. 200)(“Motion”). The Court held a hearing on September 26, 2018. See Clerk’s Minutes at
1, filed September 26, 2018 (Doc. 215).
The primary issues are: (i) whether the Basnet
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Intervenors,1 who intervened in this proposed class action after the Court entered the Final
Judgment, filed November 23, 2016 (Doc. 150), for the former named plaintiffs -- the Bastian
Plaintiffs2 -- and before the Court certified a class, can prosecute the Third Amended
Representative and Class Action Complaint for Damages for Violations of New Mexico Minimum
Wage Act and New Mexico Common Law, filed July 19, 2017 (Doc. 177)(“Third Amended
Complaint”), without seeking relief from the Final Judgment under rule 60 of the Federal Rules of
Civil Procedure; (ii) whether, if the Basnet Intervenors must seek relief under rule 60, they can
obtain relief under rule 60(b)(5), because the Defendants Tri-State Careflight, LLC and Blake
Stamper satisfied the Final Judgment for the Bastian Plaintiffs; and (iii) whether, if the Basnet
Intervenors must seek relief under rule 60, they can obtain relief under 60(b)(6), because the Final
Judgment for the Bastian Plaintiffs and the consequent possibility that the Basnet Intervenors may
not receive American Pipe and Construction Company v. Utah, 414 U.S. 538 (1974)(“American
1
The Basnet Intervenors include are Shailendra Basnet, Kristy Bell, Deborah Berest, Daniel
Bergman, William Dallas Bundrant, Jr., Rocky H. Burrows, II, Chase Carter, Brenda Casarez,
Michael Castro, Kara Cervantes, Thomas Cislo, David Daniels, Adam Doyle, Darren Een, Toby
Eicher, Walter Fabian, Harold Joseph Fisher, Christina Fleeman, Luke Forslund, Salustiano
Fragoso, Rehannon Gonzales, Kristen Grado, Courtney Guerra, Darrin Hamilton, Shane Herron,
Alexander Howell, Danielle Irvin, Allen Jacobs, Erin Johnson, Alex Jones, Donald Luke Keenan,
Daniel Kuhler, Simon Lucero, Raphael Mahaim, Nathan Maplesden, Cindy D. Maxwell, Jennifer
Mazzanti, Bethany McCandless, Ron McDearmid, Dan Meehan, Kevin Napp, James O’Connor,
Kathy Onsurez-Wilson, Eric Parker, Jason Perry, Amanda Petersen, Brent Place, Jimmy Ronald
Primm, Jr., Philip Qubain, Paul Ratigan, Joseph Root, Daron Ruckman, Frederic Ruebush, Jennifer
Salaverry, Paul Serino, Christian Speakman, Ian Stephens, Daniel St. Peters, Usvaldo R. Trujillo,
Paul Vacula, Jennifer Valdez, Graciela Villalobos, Eric Vogt, Greg Walsh, Tyler Wilkins, Virginia
Williams, Terry Zacharias, and Michael Zulaski.
2
The Bastian Plaintiffs include Keith Bastian, Cason N. Heard, Gregory Oldham, Sherry
K. Welch, and Jacqueline Fernandez-Quezada.
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Pipe”), tolling on all claims are extraordinary circumstances.3 The Court denies the Motion. The
Court concludes: (i) the Basnet Intervenors must seek relief from the Final Judgment under rule
60 before filing the Amended Complaint, because the Basnet Intervenors’ putative class interest is
not an exception to finality; (ii) the Basnet Intervenors cannot satisfy rule 60(b)(5), because rule
60(b)(5) does not provide relief against finality when a defendant has satisfied a judgment; and
(iii) the Basnet Intervenors cannot satisfy rule 60(b)(6), because the Basnet Intervenors could have
earlier intervened, and the Final Judgment and the possibility that American Pipe tolling will not
apply do not rise to extraordinary circumstances. Accordingly, the Basnet Intervenors cannot
prosecute the Third Amended Complaint.
FACTUAL BACKGROUND
The Court takes its facts from the Third Amended Complaint. The Court provides these
facts for background. It does not adopt them as the truth, and it recognizes that these facts are
largely the Basnet Intervenors’ version of events.
Tri-State Careflight operates an air ambulance service in New Mexico, Arizona, Colorado,
and Nevada. See Third Amended Complaint ¶ 11, at 4. Tri-State CareFlight employs flight
paramedics, flight nurses, and pilots at each of its New Mexico location. See Third Amended
Complaint ¶ 81, at 9. The Defendants are or were all the Basnet Intervenors’ employers within
the definition provided in the New Mexico Minimum Wage Act, N.M. Stat. Ann. §§ 50-4-1
through -33 (“NMMWA”). See Third Amended Complaint ¶ 6, at 3. Tri-State CareFlight employs
or employed the following people as pilots, nurses, or paramedics: Shailendra Basnet, Kristy Bell,
3
American Pipe tolls the statute of limitations for putative class members when the class
action is filed. See American Pipe, 414 U.S. at 546-52.
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Deborah Berest, Daniel Bergman, William Dallas Bundrant, Jr., Rocky H. Burrows, II, Chase
Carter, Brenda Casarez, Michael Castro, Kara Cervantes, Thomas Cislo, David Daniels, Adam
Doyle, Darren Een, Toby Eicher, Walter Fabian, Harold Joseph Fisher, Christina Fleeman, Luke
Forslund, Salustiano Fragoso, Rehannon Gonzales, Kristen Grado, Courtney Guerra, Darrin
Hamilton, Shane Herron, Alexander Howell, Danielle Irvin, Allen Jacobs, Erin Johnson, Alex
Jones, Donald Luke Keenan, Daniel Kuhler, Simon Lucero, Raphael Mahaim, Nathan Maplesden,
Cindy D. Maxwell, Jennifer Mazzanti, Bethany McCandless, Ron McDearmid, Dan Meehan,
Kevin Napp, James O’Connor, Kathy Onsurez-Wilson, Eric Parker, Jason Perry, Amanda
Petersen, Brent Place, Jimmy Ronald Primm, Jr., Philip Qubain, Paul Ratigan, Joseph Root, Daron
Ruckman, Frederic Ruebush, Jennifer Salaverry, Paul Serino, Christian Speakman, Ian Stephens,
Daniel St. Peters, Usvaldo R. Trujillo, Paul Vacula, Jennifer Valdez, Graciela Villalobos, Eric
Vogt, Greg Walsh, Tyler Wilkins, Virginia Williams, Terry Zacharias, and Michael Zulaski. See
Third Amended Complaint ¶¶ 12-80, at 4-9.
PROCEDURAL BACKGROUND
This case has a long and complicated procedural history. The Court recited this procedural
history in its Memorandum Opinion and Order, 327 F.R.D. 433, filed June 21, 2018
(Doc. 198)(“Consolidation MOO”).
The Court incorporates that recitation throughout the
procedural background that the Court provides below. The Court also includes footnotes from the
Consolidation MOO.
This case is a wage-and-hour dispute. See Third Amended Complaint ¶ 1, at 2. The
Plaintiffs seek to recover: (i) unpaid overtime compensation under the NMMWA; and (ii) other
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unpaid compensation on a theory of unjust enrichment. See Third Amended Complaint ¶¶ 95-128,
at 12-18.
In September, 2014, William D. Payne and Nicole Payne, “on behalf of
themselves and all others similarly situated,” filed their original complaint against
Tri-State CareFlight and Stamper. Representative Action Complaint for Damages
for Violation of New Mexico Minimum Wage Act and Unjust Enrichment at 1,
Payne v. Tri-State Careflight, LLC, D-101-CV-2014-02048 (First Judicial District,
County of Santa Fe, State of New Mexico)(Montes, J.), filed November 17, 2014
in federal court (Doc. 1-1)(“Original Complaint”). Tri-State CareFlight and
Stamper removed the case to federal court on November 17, 2014. See Notice of
Removal, filed November 17, 2014 (Doc. 1)(“Notice of Removal”). They based
removal on the Court’s diversity jurisdiction. See Notice of Removal ¶ 4, at 2.
On August 24, 2015, W. Payne and N. Payne moved to amend the Original
Complaint to: (i) eliminate a claim for certain uncompensated travel time from the
Original Complaint; and (ii) add an additional named Plaintiff -- Leslie B. Benson.
See Plaintiffs’ Amended Opposed Motion for Leave to File First Amended
Complaint, filed August 24, 2015 (Doc. 44)(“First Motion to Amend”). On
September 4, 2015, W. Payne and N. Payne filed Plaintiffs’ Motion for and Brief
in Support of Class Certification, filed September 4, 2015 (Doc. 48)(“First Motion
for Class Cert.”).4 The Court held a hearing on the First Motion to Amend on
October 28, 2015. See Clerk’s Minutes, filed October 28, 2015 (Doc. 67)(“Oct.
28th Clerk’s Minutes”); Notice of Motion Hearing, filed October 16, 2015
(Doc. 64). At an October 28, 2015, hearing, the Court granted the First Motion to
Amend. See Oct. 28th Clerk’s Minutes at 1; Order at 1, filed March 14, 2016
(Doc. 112). Later that day, W. Payne and N. Payne filed their First Amended
Representative Action Complaint for Damages for Violation of New Mexico
Minimum Wage Act, filed October 28, 2015 (Doc. 68)(“Amended Complaint”).5
By November, 2015, W. Payne, N. Payne, and Benson resolved their
individual claims against the Defendants. On November 19, 2015, the Paynes
4
W. Payne and N. Payne subsequently withdrew their First Motion for Class
Cert. on January 26, 2016. See Plaintiffs’ Notice of Withdrawal of Motion for
Class Certification, filed January 26, 2016 (Doc. 96).
5
The Amended Complaint did not include the Original Complaint’s unjust
enrichment claim, see Amended Complaint ¶¶ 25-30, at 4 (asserting an NMMWA
claim only), but the Plaintiffs remedied that oversight when they filed the Second
Amended Representative and Class Action Complaint for Damages for Violation
of New Mexico Minimum Wage Act and New Mexico Common Law . . . ¶¶ 3345, at 5-7, filed January 28, 2016 (Doc. 100).
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reached a settlement with the Defendants in which the Defendants agreed to provide
them with full relief under the NMMWA, i.e., all the relief they requested in the
Amended Complaint. See Memorandum Opinion and Order at 47, 2016 WL
9738302, at *25, filed August 12, 2016 (Doc. 138)(“Intervenor MOO”). Benson,
meanwhile, signed a global release of his claims against Tri-State CareFlight and
Stamper on October 22, 2015. See Settlement Agreement and General Release at
1-3 (dated October 22, 2015), filed December 9, 2015 (Doc. 71-1).
With W. Payne, N. Payne, and Benson’s claims resolved, a new set of
named Plaintiffs -- Keith Bastian, Cason N. Heard, Gregory Oldham, Sherry K.
Welch, and Jacqueline Fernandez-Quezada -- sought to keep the case alive by
intervening pursuant to rule 24 of the Federal Rules of Civil Procedure. See
Opposed Motion to Intervene as Parties Plaintiff and Class Representatives at 1,
filed December 15, 2015 (Doc. 73)(“First Intervention Motion”). In the First
Intervention Motion, the intervenors asserted:
[N]one of the currently named Plaintiffs will be able to pursue this
matter either individually or on behalf of the putative class members
who were deprived of overtime pay pursuant to Defendants’
uniform and unlawful overtime policies applicable to flight nurses,
flight paramedics and pilots. Intervenors seek to pick up the
prosecution of this lawsuit where the current Plaintiffs are soon to
depart.
First Intervention Motion at 2.
As the First Intervention Motion was pending, the Defendants moved the
Court, pursuant to rule 56 of the Federal Rules of Civil Procedure, to enter summary
judgment in their favor, and to dismiss all claims in the Second Amended
Complaint in their entirety and with prejudice. See Defendants Tri-State Careflight,
LLC, and Blake A. Samper’s Motion for Summary Judgment and Memorandum
Brief in Support at 1, filed March 1, 2016 (Doc. 110)(“MSJ”). The Defendants
argued that federal law preempts the Named Plaintiffs’ state-law claim for the
alleged NMMWA violation and the state-law claim for unjust enrichment. See
MSJ at 1. The Named Plaintiffs opposed the Defendants’ MSJ, and also filed their
Motion to Exclude Consideration of New Law or New Argument Raised in
Defendants’ Reply to the Motion for Summary Judgment or, in the Alternative, to
Permit Plaintiff to File a Surreply, filed on May 2, 2016 (Doc. 123)(“Motion to
Exclude”), as a result of the Defendants’ MSJ.
On August 12, 2016, the Court, pursuant to rule 24(b) of the Federal Rules
of Civil Procedure, granted the First Intervention Motion, permitting Bastian,
Heard, Oldham, Welch, and Fernandez-Quezada to intervene as Plaintiffs. See
Intervenor MOO at 1-2. The Court determined, among other things, that the
apparent resolution of W. Payne, N. Payne, and Benson’s claims “did not render
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this case moot under Article III because the personal stake of the indivisible class
may inhere prior to a definitive ruling on class certification.” Intervenor MOO at
41 (citing Lucero v. Bureau of Collection Recovery, Inc., 639 F.3d 1239, 1244-47
(10th Cir. 2011)).
In October, 2016, the Court denied the Defendants’ MSJ, concluding that
Congress “has not preempted the field of labor regulation for railroad and airline
workers, and the present dispute does not involve the interpretation of a collective
bargaining agreement.” Memorandum Opinion and Order at 2 . . . 2016 WL
6396214, at *1 . . . , filed October 25, 2016 (Doc. 147)(“MSJ MOO”). In the same
ruling, the Court also determines that “the Defendants raised a new issue of law in
their reply in support of their Motion for Summary Judgment, to which the Named
Plaintiffs may reply with a surreply should they deem it appropriate.” MSJ MOO
at 2.
On November 2, 2016, the Defendants offered, under rule 68 of the Federal
Rules of Civil Procedure, to pay the [Bastian Plaintiffs] a specific amount of money
plus their pre-offer “[a]ttorneys’ fees and costs actually and reasonably incurred.”
Offer of Judgement at 1 (dated November 2, 2016), filed November 17, 2016
(Doc. 149-1)(“Offer of Judgment”). The Offer of Judgment states: “By accepting
this Offer of Judgment, Plaintiffs agree to the entry of the attached form of final
judgment.” Offer of Judgment at 2. The Defendants informed the Court, on
November 17, 2016, that [the Bastian Plaintiffs] accepted the Defendants’ rule 68
offer. See Notice of Acceptance of Rule 68 Offer of Judgment at 1, filed November
17, 2016 (Doc. 149)(“Acceptance Notice”). See also Email from Chris Moody, to
Charles Vigil at 1 (dated November 16, 2016), filed November 17, 2016 (Doc. 1491)(“Plaintiffs accept your offer of judgment.”). The Acceptance Notice states:
Defendants hereby notify the Court that Plaintiffs have accepted
Defendants’ Rule 68 Offer of Judgment. A copy of the accepted
Offer of Judgment is attached as Exhibit A, a copy of the Form of
Judgment incorporated by reference into the Offer is attached as
Exhibit B, and Plaintiff’s [sic] acceptance of the offer is attached as
Exhibit C.
Acceptance Notice at 1. Six days later, the Court took the Defendants’ proposed
final judgment and entered it with no changes. See Final Judgment at 1, filed
November 23, 2016 (Doc. 150).
On November 29, 2016, seventeen people sought to intervene in the case as
named Plaintiffs.[6] See Opposed Fed. R. Civ. P. 24(b) Motion and Supporting
6
These seventeen people are Kristy Bell, William Dallas Bundrant, Jr., Rocky H. Burrows,
II, Brenda Casarez, Adam Doyle, Julie Etchegaray, Walter Fabian, Kristen Grado, Courtney
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Memorandum to Intervene as Parties Plaintiff and Class Representatives, filed
November 29, 2016 (Doc. 151)(“Motion to Intervene”). On June 27, 2017, fiftytwo more people sought to intervene as named Plaintiffs into the case.[7] See
Opposed Fed. R. Civ. P. 24(B) Supplemental Motion and Supporting Memorandum
to Intervene as Parties Plaintiffs and Class Representatives, filed June 27, 2017
(Doc. 166)(“Supp. Motion to Intervene”).
On August 3, 2017, while the Court considered the Motion to Intervene and
the Supp. Motion to Intervene, “a number of the proposed Plaintiffs/Intervenors
filed a separate, but essentially duplicative” complaint in the United States District
Court for the District of New Mexico, apparently to cover their bases vis-à-vis
tolling concerns. Motion to Consolidate at 1. See Bell v. Tri-State CareFlight,
LLC, No. CIV 17-0796 (“Bell”). Tri-State CareFlight and Stamper moved to
transfer that case, Bell v. Tri-State CareFlight, LLC, No. CIV 17-0796 (“Bell”),
from the Honorable Kenneth J. Gonzales, United States District Judge for the
District of New Mexico, to the Court. See Bell, Defendants’ Motion to Transfer
Related Case to Honorable James O. Browning, filed September 26, 2017
(Doc. 11)(“Motion to Transfer”). In the Motion to Transfer, the Defendants state:
“Pursuant to Rule 42(a)(3) of the Federal Rules of Civil Procedure, Defendants TriState CareFlight, LLC and Blake A. Stamper respectfully move the Court to
transfer the above-captioned case to the Honorable James O. Browning.” Motion
to Transfer at 1.
On September 30, 2017, the Court granted the Motion to Intervene and the
Supp. Motion to Intervene, which added sixty-[eight] current and former Tri-State
CareFlight employees as named Plaintiffs. See Memorandum Opinion and Order
Guerra, Donald Luke Keenan, Brent Place, Jimmy Ronald Primm, Jr., Cindy D. Maxwell, Frederic
Ruebush, Daniel St. Peters, Graciela Villalobos and Michael Zulaski.
7
These additional people are Shailendra Basnet, Deborah Berest, Daniel Bergman, Chase
Carter, Michael Castro, Kara Cervantes, Thomas Cislo, David Daniels, Darren Een, Toby Eicher,
Harold Joseph Fisher, Christina Fleeman, Luke Forslund, Salustiano Fragoso, Rehannon
Gonzales, Darrin Hamilton, Shane Herron, Alexander Howell, Danielle Irvin, Allen Jacobs, Erin
Johnson, Alex Jones, Daniel Kuhler, Simon Lucero, Raphael Mahaim, Nathan Maplesden, Jennifer
Mazzanti, Bethany McCandless, Ron McDearmid, Dan Meehan, Kevin Napp, James O’Connor,
Kathy Onsurez-Wilson, Eric Parker, Jason Perry, Amanda Petersen, Philip Qubain, Paul Ratigan,
Joseph Root, Daron Ruckman, Jennifer Salaverry, Paul Serino, Christian Speakman, Ian Stephens,
Usvaldo R. Trujillo, Paul Vacula, Jennifer Valdez, Eric Vogt, Greg Walsh, Tyler Wilkins, Virginia
Williams, and Terry Zacharias. Julie Etchegaray is not included in the Opposed Fed. R. Civ. P.
24(B) Supplemental Motion and Supporting Memorandum to Intervene as Parties Plaintiffs and
Class Representatives, filed June 27, 2017 (Doc. 166).
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at 60, 322 F.R.D. 647, 683, filed September 30, 2017 (Doc. 175)(“Intervention
MOO”). In the Intervention MOO, the Court states:
. . . . Second, the Named Plaintiffs’ settlement agreement did not
render the Proposed Intervenors claims moot, because their personal
stake in the class -- and, therefore, an Article III case or controversy
-- inhered at the action’s beginning. . . .
Intervention MOO at 2, 322 F.R.D. at 654.
Consolidation MOO at 2-7, 322 F.R.D. at 436-38. In reaching this conclusion, the Court relies on
Lucero v. Bureau of Collection Recovery, Inc., 639 F.3d at 1249. The Court explains: “Lucero
holds that, when a class certification is pending, ‘any Article III interest a class may or may not
have in a case is or is not present from its inception’ and that ‘the personal stake of the class inheres
prior to certification.’” Intervention MOO at 53, 322 F.R.D. at 679 (quoting Lucero v. Bureau of
Collection Recovery, Inc., 639 F.3d at 1249). The Court also concludes:
Third, relief from the Final Judgment is not necessary for the
Proposed Intervenors to intervene. . . .
Intervention MOO at 2, 322 F.R.D. at 654. The Court also determines, in the
Intervention MOO, that a nonparty may, in certain circumstances, intervene into a
case in which a final judgment has been entered. See Intervention MOO at 55-56,
322 F.R.D. at 680. The Court states:
[T]he Proposed Intervenors need not disturb the Named
Plaintiffs’ Final Judgment in order to intervene; rather, they must
first intervene before they can seek relief from the judgment.
Because intervention is a precondition for a nonparty to
make a rule 60(b) motion, not the other way around, the Court
concludes that the Named Plaintiffs’ Final Judgment presents no
insurmountable obstacle to the Proposed Intervenors’ Motion to
Intervene.
Intervention MOO at 55-56, 322 F.R.D. at 680.
Consolidation MOO at 7-8, 327 F.R.D. at 438-39. The Court rests its decision on United Airlines,
Inc. v. McDonald, 432 U.S. 385 (1977), wherein the Supreme Court of the United States of
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America “ruled that a nonparty could intervene after a final judgment to appeal the denial of class
certification when the intervenor acted promptly upon learning that the named plaintiffs . . . did
not intend to appeal.” Intervention MOO at 55, 322 F.R.D. at 680 (citing United Airlines, Inc. v.
McDonald, 432 U.S. at 934).
The Court did not make a determination regarding whether the intervening
Plaintiffs could proceed, notwithstanding the Court’s Final Judgment, without
obtaining relief from that Final Judgment via a motion under rule 60(b) of the
Federal Rules of Civil Procedure. The Court also expressed its misgivings:
The Court arrives at this conclusion with reservations. First,
the Court is skeptical that most motions to intervene after final
judgment are timely, particularly here given that the Proposed
Intervenors’ attorneys also represent the Named Plaintiffs and
therefore had a direct hand in reaching the settlement and entering
the Final Judgment. The Proposed Intervenors, therefore, could not
have been taken by surprise and presumably were capable of making
their motion before the Final Judgment was entered. Second, the
Court is not eager to deprive the Defendants of the benefit of that
bargain: unlike the first settlements with the Original Plaintiffs, the
Defendants took the rule 68 route with the Named Plaintiffs and
deliberately negotiated for the Final Judgment. See Offer of
Judgment at 2 (“By accepting this Offer of Judgment, Plaintiffs
agree to the entry of the attached form of final judgment.”). The
Defendants have not expressly stated why they bargained for the
Final Judgment, but it could be precisely for this moment. One
possibility is that, having unsuccessfully opposed the first motion to
intervene, they figured a Final Judgment might make it harder for
future intervenors. Another possibility is that the Defendants may
want to do some judge-shopping: they may prefer to shut the case
down before the Court and defend against the remaining claims that
are undoubtedly on the way before another judge in a separate case.
A third possibility is that they may want to force their opponents to
file another case and pay another filing fee. Finally, and most likely,
the Defendants may want to take advantage of any applicable statute
of limitations and cut down on damages. See Tr. at 15:8-10
(Lowry)(“[W]e believe there are some people in the proposed class,
assuming this proceeds as a class action, whose claims would be
barred.”). By treating the Final Judgment like any other judgment
-- i.e., not presuming that a post-final judgment intervention motion
is untimely, or not requiring intervenors undo the final judgment via
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rule 60(b) before seeking intervention -- the Defendants may be
deprived of the benefit of their bargain. That outcome looks a lot
like prejudice. Also, simply ignoring rule 60(b)’s plain language, as
the court does in United Airlines v. McDonald, seems misguided;
rules should be construed like statutes, and under the rules of
statutory construction, a statute’s plain language should not be
overlooked. See Lamie v. U.S. Trustee, 540 U.S. 526, 534
(2004)(“It is well established that when the statute’s language is
plain, the sole function of the courts -- at least where the disposition
required by the text is not absurd -- is to enforce it according to its
terms.”).
With respect to prejudice, the Court shares [the misgivings
that the Honorable Lewis F. Powell Jr., former Associate Justice of
the Supreme Court] expressed in his dissent in United Airlines v.
McDonald, 432 U.S. 385, 399-400 (Powell, J., dissenting). The
dissent asserted that allowing post-final judgment intervention in
that case unduly prejudices the defendant, arguing that, because only
named plaintiffs may appeal a certification denial, and the
settlement ended the named plaintiffs’ ability to appeal the denial,
then no one remained to make the appeal -- not even an unnamed
member of the putative class. See 432 U.S at 399-400 (Powell, J.,
dissenting). Thus, the dissent asserts, “[h]aving achieved a
settlement of the case, [the defendant] was prejudiced by [the
intervenor’s] attempt to reopen the case.” 432 U.S. at 399
(Powell, J., dissenting). The majority, meanwhile, stated that the
defendant “can hardly contend that its ability to litigate the issue was
unfairly prejudiced simply because an appeal on behalf of putative
class members was brought by one of their own, rather than by one
of the original named plaintiffs.” 432 U.S. at 394-95 (Powell, J.,
dissenting).
The Court also shares the dissent’s skepticism of the
majority’s “casual treatment of the prejudice” to a putative class
action defendant who settles with all named plaintiffs. 432 U.S. at
399 (Powell, J., dissenting). Not only does the majority’s approach
risk prejudice to a defendant, but it does so by disregarding the
judicial system’s interest in settlements and finality, see 432 U.S. at
401 (Powell, J., dissenting)(“The Court also ignores the important
‘principle that (s)ettlement agreements are highly favored in the law
and will be upheld whenever possible because they are a means of
amicably resolving doubts . . . and preventing lawsuits.’” (quoting
Pearson v. Ecological Sci. Corp., 522 F.2d 171, 176 (5th Cir.
1975))), and undermining public policy behind statute of limitations,
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see 432 U.S. 385, 400 (Powell, J., dissenting)(“Considerations of
policy militate strongly against the result reached by the Court. Our
cases reflect a long tradition of respect for statutes of limitations and
the values they serve.”).
Intervention MOO at 59-60 n.18, 322 F.R.D. at 682 n.18.
Following the Intervention MOO, the parties’ counsel began discussing a
stipulated order to be filed in Bell vis-à-vis the Transfer Motion. On October 3,
2017, the Defendants’ counsel wrote to the Plaintiffs’ counsel:
What are your thoughts, in light of your agreement to not oppose
consolidation, on the parties filing a joint motion with [the
Honorable Carmen E. Garza, United States District Judge for the
District of New Mexico] asking to vacate the JSR deadline and the
scheduling conference?
Email from Charles J. Vigil, to Christopher M. Moody and Repps D. Stanford at 3
(dated October 3, 2017), filed October 19, 2017 (Doc. 178-1). The Plaintiffs’
counsel responded:
On our call we said that we would not oppose consolidation so long
as there is no appeal of the intervention order. Thinking about it, I
don’t think you would have an appeal anyway so assuming that you
agree not to try an interlocutory appeal, we are not opposing
consolidation. If we are not opposing consolidation I think it makes
sense to ask Judge Garza to vacate the JSR/scheduling conference
and we submit an order of consolidation and then proceed with case
scheduling before Judge Browning. In our experience Judge Garza
is pretty available by phone so we might want to approach it that
way.
Email from Christopher M. Moody, to Charles J. Vigil and Repps D. Stanford at 3
(dated October 3, 2017), filed October 19, 2017 (Doc. 178-1). The Defendants
responded: “Ok. Makes sense. We are not appealing the intervention order.” Email
from Charles J. Vigil, to Christopher M. Moody and Repps D. Stanford at 3 (dated
October 3, 2017), filed October 19, 2017 (Doc. 178-1).
Consolidation MOO at 8-10, 327 F.R.D. 433 at 439-40.
On October 4, 2017, the Basnet Intervenors filed the Third Amended Complaint. See Third
Amended Complaint at 18. The same day,
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the Defendants’ counsel emailed the Plaintiffs’ counsel a draft of the Stipulated
Order, asking for the Plaintiffs’ counsel’s thoughts. See Email from Jeffrey L.
Lowry, to Christopher M. Moody and Repps D. Stanford at 6 (dated October 4,
2017), filed October 19, 2017 (Doc. 178-1). The Plaintiffs’ counsel responded:
“The order looks fine except that we think it should refer to Rule 42(a)(2) rather
than (a)(3). That’s the part of the rule implicated in all the class cases involving
consolidation that we have seen.” Email from Christopher M. Moody, to Jeffrey
L. Lowry and Repps D. Stanford at 6 (dated October 4, 2017), filed October 19,
2017 (Doc. 178-1). The Defendants’ counsel explained:
The motion cited Rule 42(a)(3) because it allows the most flexibility
given the unusual circumstances and status of the two cases.
Nevertheless, I don’t know that we need to get hung up on the
subparagraph. If we revise the order to cite Rule 42 without
reference to any particular part of that rule, would that be
acceptable?
Email from Jeffrey L. Lowry, to Christopher M. Moody at 6 (dated October 4,
2017), filed October 19, 2017 (Doc. 178-1). Later that day, Defendants’ counsel
emailed Plaintiffs’ counsel: “Here are the motion and order to vacate the Bell
deadlines and scheduling conference as well as the final version of the stipulated
order on the motion to transfer case. With your approval, I’ll file / submit these
today.” Email from Jeffrey L. Lowry, to Christopher M. Moody at 9 (dated October
4, 2017), filed October 19, 2017 (Doc. 178-1). The Plaintiffs’ counsel replied:
“Looks good.” Email from Repps D. Stanford, to Jeffrey L. Lowry and Christopher
M. Moody at 9-10 (dated October 4, 2017), filed October 19, 2017 (Doc. 178-1).
On the same day, the Plaintiffs filed the Complaint in this case, see Complaint at 1.
On October 6, 2017, [Judge Gonzales], approved Bell, Stipulated Order
Granting Defendants’ Motion to Transfer Related Case to Honorable James O.
Browning, filed October 6, 2017 (Doc. 15)(“Transfer Order”). The Transfer Order
states that the “Plaintiffs do not oppose” Tri-State FlightCare’s Motion to Transfer
and that Judge Gonzalez grants the Motion to Transfer. Transfer Order at 1. The
Transfer Order concludes with the following: “Accordingly, pursuant to Rule 42 of
the Federal Rules of Civil Procedure, IT IS HEREBY ORDERED that the above
captioned case be transferred to the Honorable James O. Browning, who shall
preside over all future proceedings.” Transfer Order at 1-2.
On October 16, 2017, the Plaintiffs’ counsel’s paralegal, Anne Chavez,
spoke with the Court’s Courtroom Deputy, Michelle Behning, to determine whether
Bell and this case had been consolidated. See Declaration of Anne Chavez ¶¶ 4-6,
at 1 (dated November 15, 2017), filed November 15, 2017 (Doc. 181-2)(“Chavez
Decl.”). Behning “confirmed that the cases had not formally been consolidated,
and suggested that a motion to consolidate be filed if that was the direction Counsel
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wished to take.” Chavez Decl. ¶ 6, at 1. That same day, the Plaintiffs’ counsel
emailed the Defendants’ counsel:
My paralegal spoke with Michelle at Judge Browning’s chambers
this morning regarding consolidation. We filed our reply brief on
Friday only in the Bell case because we have not received any order
consolidating the two cases from Judge Browning (just the notice
from the clerk reassigning the Bell case to Judge Browning).
Michelle told us that the two cases (Bell and Bastian or whatever we
are calling it now) are not consolidated and that if we want them
consolidated we need to file a motion. What do you think?
Email from Christopher M. Moody, to Charles J. Vigil and Jeffrey L. Lowry at 10
(dated October 16, 2017), filed October 19, 2017 (Doc. 178-1). The Defendants’
counsel responded:
Many thanks. Not being party to your paralegal’s ex parte
communications with Judge Browning’s chambers, it is difficult for
me to comment. We filed a motion to transfer the Bell case to
Judge Browning and that is what was approved by Judge Gonzales.
And, that is what has happened -- the Bell case is no[w] assigned to
Judge Browning. It was most certainly never a motion to
consolidate. . . . In any event, we believe consolidation is improper.
To the extent Plaintiffs are entertaining making of such a motion,
please be advised that the Defendants oppose and will oppose any
motion to consolidate the two cases.
Email from Charles J. Vigil, to Christopher M. Moody and Jeffrey L. Lowry at 10
(dated October 16, 2017), filed October 19, 2017 (Doc. 178-1)(emphasis in
original).
Consolidation MOO at 10-12, 327 F.R.D. at 440-41.
The Basnet Intervenors then filed the Basnet Intervenors’ Opposed Fed. R. Civ. P. 42
(A)(1) & (A)(2) Motion to Consolidate, filed October 19, 2017 (Doc. 178)(“Motion to
Consolidate”), asking to consolidate this case and Bell. See Motion to Consolidate at 1. Thirteen
days later, the Defendants filed the Defendants’ Motion to Strike or Dismiss Third Amended
Complaint, filed November 1, 2017 (Doc. 180)(“Motion to Strike”), arguing that, because this case
is closed, the Basnet Intervenors cannot prosecute the Third Amended Complaint. See MTD at 1.
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In the Consolidation MOO, the Court granted the Basnet Intervenors’ request to consolidate. See
Consolidation MOO at 436, 450, 452-54. The Court reasoned:
Given that the facts, parties, and legal claims are virtually identical, consolidating
the cases would be the most efficient way forward. The Court does not see how
consolidation could cause delay or prejudice; there appears to be no upside to
keeping these cases separate.
....
. . . . The Defendants’ position is that the Court’s Final Judgment means that there
is no action before the court with which Bell can be consolidated. See
Consolidation Response at 7-9. See also Fed. R. Civ. P. 42(a) (listing procedural
options available for “actions before the court”). The Defendants’ [sic] contend
that, once a court enters a final judgment, nothing else can happen in the case unless
and until the final judgment is set aside. See Consolidation Response at 8-9 (citing
Rekstad v. First Bank Sys. Inc., 238 F.3d 1259, 1261 (10th Cir. 2001); United States
v. Kentucky Utilities Co., 927 F.2d 252, 255 (6th Cir. 1991)); Pedroza v. Lomas
Auto Mall, Inc., 304 F.R.D. 307, 333 (D.N.M. 2014)(Browning, J.); Thompson v.
THI of New Mexico at Casa Arena, [No. CIV 05-1331 JB/LCS,] 2008 WL
5999653, at *28 [(D.N.M. Dec. 24, 2008)(Browning, J.)]).
Consolidating an active case with one in which Final Judgment has been
entered is permissible, but rarely appropriate. See, e.g., Shelton v. MRIGlobal, No.
11-CV-02891, 2014 WL 793464, at *2 (D. Colo. Feb. 26,
2014)(Brimmer, J.)(“Courts are reluctant to consolidate a pending case with a case
where a final judgment has been entered, unless the final judgment is first
vacated.”); Washington v. Brumbaugh & Quandahl, P.C., LLO., No. 8:15CV444,
2016 WL 1435665, at *3 (D. Neb. Apr. 11, 2016)(Strom, J.), on reconsideration,
No. 8:15CV444, 2016 WL 4734393 (D. Neb. Sept. 9, 2016); Tormasi v. Hayman,
No. CIV. 3:08-CV-4950, 2009 WL 3335059, at *3 (D.N.J. Oct. 15,
2009)(Thompson, J)(concluding that consolidating an active case with a closed
case would not “promote the administration of justice”). But see Abels v.
Skipworth, No. C10-5033BHS, 2010 WL 2376230, at *1 (W.D. Wash. June 9,
2010)[(Settle, J.)](concluding that the plaintiff’s request to consolidate a case with
a prior closed case is “misplaced,” because rule 42(a) applies to actions before the
court, and the plaintiff’s prior case “is no longer an action before the Court”). Here,
however, these cases’ unique circumstances satisfy the Court that consolidation
would help the parties resolve their disputes most efficiently. Although the Court
has entered Final Judgment in this case, the Court recently granted motions [sic] to
intervene, restocking this case’s docket with sixty-nine fresh named Plaintiffs.
Whether they can or must undo the Final Judgment via a rule 59 or 60 motion before
proceeding any further remains to be seen, but given that the Court has already
- 16 -
allowed intervention, there is enough life in the case for consolidation to be a useful
and efficient tool. That low bar is enough for the Court to file documents in a
docket in a consolidated case rather than keeping them separate. When the Court
has consolidated cases in the past, it has occasionally had to dismiss one of the
cases and enter final judgment; yet the cases remain consolidated in a consolidation
caption and the Court does not “unconsolidate” the cases. Here, the only difference
is that the Court entered a final judgment in this case before consolidating the cases
rather than entering final judgment after the consolidation order. In any event, the
Court concludes that consolidating the cases will help avoid unnecessary costs and
economize the Court’s resources, notwithstanding the final judgment.
Consolidation MOO at 34-36, 327 F.R.D. at 452-53. The Court chose to leave the Third Amended
Complaint on file until the Basnet Intervenors demonstrate that they do not need to satisfy rule 59
or rule 60 before they prosecute the Third Amended Complaint, or that rule 59 or rule 60 permits
this case to proceed. See Consolidation MOO at 37-38, 327 F.R.D. at 453. The Court permitted
the Defendants not to file an answer to the Third Amended Complaint until the Court and the
parties determined whether the Basnet Intervenors could proceed with this litigation.
See
Consolidation MOO at 37-38, 327 F.R.D. at 453. Because the arguments in the briefing and
hearing on the Motion to Strike overlap with the briefings on the Motion, the Court incorporates
in full its earlier summary of those briefings and that hearing.
3.
The Motion to Strike.
The Defendants filed their Motion to Strike in this case on November 1,
2017. See Motion to Strike at 1. In the Motion to Strike, the Defendants argue that
the Court should dismiss the [Third Amended] Complaint, because the case remains
closed. See Motion to Strike at 4. According to the Defendants, the Plaintiffs may
not file their [Third Amended] Complaint until they convince the Court to set aside
the Final Judgment. See Motion to Strike at 4-5. The Defendants contend that the
Court should “strike or dismiss” the [Third Amended] Complaint “on jurisdictional
grounds” pursuant to rule 12(b)(1) of the Federal Rules of Civil Procedure, or
pursuant to rule 12(b)(6) Federal Rules of Civil Procedure, because the Court
cannot provide relief so long as the Final Judgment remains in place. Motion to
Strike at 5.
....
- 17 -
5.
The Response to the Motion to Strike.
The Plaintiffs respond to the Motion to Strike. See Intervenors’/Plaintiffs’
Response to Defendants’ Motion to Strike or Dismiss Third Amended Complaint
[Doc. 180], filed November 15, 2017 (Doc. 182)(“Strike Motion Response”). The
Plaintiffs argue that filing the [Third Amended] Complaint was proper, because -the Plaintiffs contend -- the Court’s Intervention MOO establishes that the Plaintiffs
may proceed with their claims without moving to set aside the Final Judgment. See
Strike Motion Response at 3-4. The Plaintiffs contend that they do not seek to undo
the Final Judgment, which resolves five Plaintiffs’ individual claims “but did not
affect the nascent class interests.” Strike Motion Response at 4-5. The Plaintiffs
also contend that the Defendants, in bringing the Motion to Strike, aim to keep the
Plaintiffs’ claims active in the sister proceeding Bell, which could mean that some
Plaintiffs’ and proposed class members’ claims might be time barred. See Strike
Motion Response at 7 n2. The Plaintiffs argue that the Defendants’ “procedural
shenanigans” are “contrary to the spirit and intent of the Federal Rules of Civil
Procedure ‘to secure the just, speedy, and inexpensive determination of every action
and proceeding.’” Strike Motion Response at 7 n.2 (quoting Fed. R. Civ. P. 1)).
6.
The Reply to the Motion to Strike.
The Defendants reply to the Motion to Strike Response. See Reply in
Support of Defendants’ Motion to Strike or Dismiss Third Amended Complaint,
filed December 6, 2017 (Doc. 186)(“Strike Motion Reply”). The Defendants reply
that, if there is any party engaging in creative procedural stratagems, it is the
Plaintiffs, given that they
filed a separate complaint that they concede is nearly identical to the
Third Amended Complaint that is at issue in the instant motion, then
agreed to transfer that lawsuit to the judge presiding over this
lawsuit, and then filed a motion to consolidate the two complaints
that they had filed separately.
Strike Motion Reply at 1. The Defendants argue that the Intervention MOO’s
wording and the authorities it cites indicate that the Plaintiffs must move to set aside
the Final Judgment before proceeding in this case. See Strike Motion Reply at 1-2
(citing Intervention MOO at 54-55, 322 F.R.D. [at] 681; United States v. Kentucky
Utilities Co., 927 F.2d 252, 255 (6th Cir. 1991)). The Defendants contend that the
Plaintiffs provide no authority for their “remarkable proposition” that “final
judgments have no effect or relevance at all to potential class members who are
allowed to intervene after the final judgment is entered.” Strike Motion Reply at 2.
The Defendants contend that the Court rejected a similar theory in a different case.
See Strike Motion at 3 (citing Thompson v. THI of New Mexico at Casa Arena,
No. CIV 05-1331, 2008 WL 5999653, at *1 (D.N.M. Dec. 24,
2008)(Browning, J.)).
- 18 -
7.
The Hearing.
The Court held a hearing on June 5, 2018. See Draft Hearing Transcript
(taken June 5, 2018)(“Tr.”).8 The Court began by stating that, when it drafted the
Intervention MOO, it imagined that the intervenors would need to satisfy rule 60 to
set aside the Final Judgment before proceeding on their claims. See Tr. at 3:254:10 (Court). . . . [T]he Court stated that it did not see a problem with leaving the
Complaint alone for now until the Court determines whether the Plaintiffs may
proceed despite the Final Judgment. See Tr. at 4:24-5:12 (Court).
The Plaintiffs stated that, if the Court is comfortable consolidating the cases
and then “seeing how a rule 60 motion plays out, . . . we’re perfectly fine with that
approach.” Tr. at 5:25-6:5 (Stanford). The Defendants asked about the “practical
effect” of consolidating a case, and the Court stated that “we simply call these cases
together anytime we schedule anything[;] we indicate [they are] together until we
get it resolved.” Tr. at 6:11-18 (Lowry, Court). The Court added that, if it does not
open the closed case, “then I’m not sure that it has any important consequences at
all.” Tr. at 6:18-22 (Court).
The Defendants addressed the Motion to Strike and stated that allowing the
[Third Amended] Complaint to remain on the docket seems inconsistent with how
the Court handled a similar issue in Thompson v. THI of New Mexico at Casa
Arena, 2008 WL 5999653, at *1, and also raised questions regarding the
Defendants’ procedural responsibilities, such as whether it would have to answer
the [Third Amended] Complaint. See Tr. at 6:25-7:20 (Lowry). The Court
responded that, if it left the [Third Amended] Complaint on the docket, the Court
would not require the Defendants to answer it until the rule 60 issue is resolved.
See Tr. at 7:21-8:1 (Court). The Plaintiffs agreed with that approach. See Tr. at
8:2-6 (Stanford).
Consolidation MOO at 15-17, 327 F.R.D. at 442-44.
1.
The Motion.
The Basnet Intervenors now complain that the Defendants interpret the Intervention MOO
to only “permit the Intervenors to obtain standing to contest the final judgment . . . not that
intervenors could actually activate and prosecute the Third Amended Complaint without undoing
8
The Court’s citations to the hearing transcript refer to the court reporter’s
original, unedited version. Any final transcript may contain slightly different page
and/or line numbers.
- 19 -
the final judgment.” Motion at 4 (emphasis in original). The Basnet Intervenors want to resolve
whether they must “seek relief under Fed. R. Civ. P. 60 from the final judgment . . . in order to
prosecute their Third Amended Complaint” and, if they must seek such relief, under which
provision they can obtain it. Motion at 4.
The Basnet Intervenors first contend that the concerns “militating against giving district
courts free reign to reconsider their judgments” do not apply here. Motion at 4. The Intervenors
identify two concerns: (i) an interest in finality; and (ii) an interest in “a clean jurisdictional
handoff from the district court to the Court of Appeals.” Motion at 5. See Motion at 4-5 (citing
Anderson Living Tr. v. WPX Energy Prod., LLC, 308 F.R.D. 410, 431-32 (D.N.M.
2015)(Browning, J.)). According to the Basnet Intervenors, here, the interest in finality pertains
to the Bastian Plaintiffs and not to putative class members. See Motion at 5. The Basnet
Intervenors argue that “there remained a nascent interest in the class case and a pending class
motion.” Motion at 5. The Basnet Intervenors note that the Defendants knew when they submitted
the Final Judgment that putative class members would intervene. See Motion at 5. According to
the Basnet Intervenors, “cross-jurisdiction confusion” is not a concern, because the Bastian
Plaintiffs will not seek an appeal. Motion at 5.
The Basnet Intervenors aver that they “should not have to file a Rule 60(b) Motion for
several reasons.” Motion at 5. The Basnet Intervenors describe that the Intervention MOO granted
them “the permissive right to intervene in the lawsuit pursuant to Rule 24(b), to substitute in as
party plaintiffs for the prior class representatives and to file the Third Amended Complaint.”
Motion at 5-6. According to the Basnet Intervenors, the Court would not have assessed “the
doctrines of mootness, subject matter jurisdiction and intervention” if the Basnet Intervenors could
- 20 -
not pursue the Third Amended Complaint. Motion at 6. The Basnet Intervenors argue that,
“[h]aving intervened and been substituted in, the Intervenors became the new real parties in interest
and should be permitted to assert their claims and the claims of the class.” Motion at 6. See
Motion at 11.
The Basnet Intervenors argue that the Final Judgment applies to the Bastian Plaintiffs only,
see Motion at 6, 10, and that putative class members’ interests remain, see Motion at 7. The Basnet
Intervenors state that they
are unable to locate authority holding that the final judgment in a class action
lawsuit, entered only as to five individual plaintiffs’ claims, even impacts, let alone
serves to extinguish, the rights of the putative class members against whom no final
judgment was entered to intervene directly into the lawsuit pursuant to Rule 24(b).
Motion at 7. The Basnet Intervenors describe that “[t]he [United States Court of Appeals for the]
Tenth Circuit has correctly recognized that the ‘nascent interest’ of the putative class members
inhered at the inception of the class action lawsuit,” Motion at 7 (citing Lucero v. Bureau of
Collection Recovery Inc., 639 F.3d 1239), and that the Court recognized these nascent interests in
the Intervention MOO, see Motion at 7. The Basnet Intervenors emphasize that, in Lusardi v.
Xerox Corporation, 975 F.2d. 964, 975-76 (3rd Cir. 1992), the United States Court of Appeals for
the Third Circuit recognized that a named plaintiff’s settlement agreement did not render moot
putative class members’ rights, deprive the court of subject-matter jurisdiction, or prevent the
named plaintiff from arguing a pending class certification motion. See Motion at 8.
According to the Basnet Intervenors, when named plaintiffs leave a class, courts frequently
permit new representatives to intervene or appoint new representatives. See Motion at 8 (citing In
re Telectronics Pacing Sys., Inc., Accufix Atrial “J” Leads Prods. Liab. Litig., 172 F.R.D. 271,
283 (S.D. Ohio 1997)(Spiegel, J.); Shankroff v. Advest, Inc., 112 F.R.D. 190, 194 (S.D.N.Y.
- 21 -
1986)(Kram, J.); Manual for Complex Litigation (4th), § 21.26 at 277 (Fed. Judicial Ctr. 2004)).
The Basnet Intervenors argue that the same principle should apply where, as here, the named
plaintiffs settle their individual claims. See Motion at 9. According to the Basnet Intervenors,
moreover, the Court should not require them to file a rule 60 motion, because rule 1 of the Federal
Rules of Civil Procedure directs that the rules “should be construed, administered, and employed
by the court and the parties to secure the just, speedy, and inexpensive administration of every
action and proceeding.” Motion at 9 (quoting Fed. R. Civ. P. 1).
The Basnet Intervenors further contend that, if putative class members cannot intervene
after the named plaintiffs settle and the court enters a final judgment, putative class members will
suffer a detriment, because defendants will pick off named plaintiffs and require the putative class
members to file a new lawsuit. See Motion at 9. According to the Basnet Intervenors, the putative
class members will suffer, because they will have to find a new named plaintiff and an inevitable
delay will occur in filing the new lawsuit. See Motion at 9. The Basnet Intervenors note that, if
the Court permits the Third Amended Complaint to proceed, the Court will not need to decide any
tolling issues. See Motion at 10.
In the alternative, the Basnet Intervenors argue that the Court should permit them to seek
relief against the Final Judgment under rule 60(b)(5) or rule 60(b)(6). See Motion at 11. The
Basnet Intervenors concede that these circumstances differ from other situations wherein a court
would apply rule 60. See Motion at 11. According to the Basnet Intervenors, the Basnet
Intervenors do not seek relief from a judgment that affects them; they, the Basnet Intervenors
explain, seek relief from “any ‘finality’ effect” that the Final Judgment has on the Third Amended
Complaint. Motion at 11.
- 22 -
The Basnet Intervenors state that rule 60(b)(5) enables a court to relieve “a party from a
final judgment if . . . the judgment has been satisfied.” Motion at 11 (citing Fed. R. Civ. P.
60(b)(5); Gibbs v. Maxwell House, A Div. of Gen. Foods Corp., 738 F.2d 1153, 1155 (11th Cir.
1984)). The Basnet Intervenors aver: “While recognizing that the situation presented here is not
the typical situation contemplated by this subsection of the rule, the circumstances literally satisfy
this requirement.” Motion at 12. The Basnet Intervenors explain that the Defendants paid the
Bastian Plaintiffs pursuant to the Final Judgment and so rule 60(b)(5)’s conditions are met. See
Motion at 12.
Alternatively, the Basnet Intervenors request that the Court apply rule 60(b)(6). See
Motion at 12. The Basnet Intervenors acknowledge that rule 60(b)(6) “is extraordinary in nature,”
Motion at 12 (citing Smith v. United States, 561 F.3d 1090, 1096 n.8 (10th Cir. 2009)), and argue
that “the circumstances here are extraordinary and definitely justify relief,” Motion at 12. The
Basnet Intervenors describe that the class interest has existed from the lawsuit’s start “through the
class certification motion that was pending” when the Court filed the Final Judgment “and still
exists.” Motion at 12. The Basnet Intervenors argue:
There has been no deliberate delay on the part of the Intervenors (they filed their
intervention motion just a few days after final judgment), there is no prejudice to
defendants, and the failure to permit intervention in this lawsuit could jeopardize
the legal claims of one or more Intervenors and putative class members if they are
forced to proceed with the later filed, but recently consolidated, Bell lawsuit, which
was filed on August 3, 2017 [Doc. 1].
Motion at 12. According to the Basnet Intervenors, “the ends of justice require that Intervenors
be permitted to proceed” and, for the Basnet Intervenors, this interest in justice “justifies relief
from a final judgment.” Motion at 12-13.
- 23 -
The Basnet Intervenors conclude by indicating that they filed the Motion “within a
reasonable time after it could have been made,” pursuant to rule 60(c)(1). Motion at 13 (citing
Sprint Spectrum, L.P. v. Genesis PCS Corp., 236 F.R.D. 530, 532-33 (D. Kan.
2006)(Robinson, J.)). The Basnet Intervenors describe first that they had to intervene before they
could challenge the Final Judgment and that they believed that the Intervention MOO indicated
that they did not need to seek relief under rule 60. See Motion at 13. The Basnet Intervenors
explain that the question whether they need to seek relief arose only after the Court filed the
Consolidation MOO and that they filed this Motion soon thereafter. See Motion at 13. The Basnet
Intervenors argue that, because, in the Intervention MOO, the Court concluded that intervention
would not prejudice the Defendants, the Defendants cannot argue that granting a rule 60 motion
would prejudice them and that, because the plaintiffs have been continuing to prosecute this
lawsuit, such a decision does not implicate finality. See Motion at 13.
3.
The Response.
The Defendants respond in the Defendants’ Response in Opposition to Plaintiffs’ Motion
to Address Issue of Fed. R. Civ. P. 60 for Intervenors to Proceed with Third Amended Complaint,
or Alternatively Fed. R. Civ. P. 60(B) Motion to Obtain Relief from Final Judgment, filed August
27, 2018 (Doc. 205)(“Response”). The Defendants argue that the Basnet Intervenors must satisfy
rule 60(b). See Response at 3. According to the Defendants, the Court has indicated that the
Basnet Intervenors must satisfy rule 59 or rule 60 before they can proceed with the Third Amended
Complaint. See Response at 1-2. The Defendants contend that, when the Court permitted the
Defendants not to answer the Third Amended Complaint, the Court “implicitly reaffirm[ed] the
litigation could not proceed unless and until the Court set aside the Final Judgment.” Response at
- 24 -
2-3 (citing Consolidation MOO at 38, 327 F.R.D. at 453). The Defendants indicate that the Court
earlier observed “that ‘[o]nce a case is ‘unconditionally dismiss[ed],’ the court loses all jurisdiction
over the case other than the ability to hear motions under rule 60(b).’” Response at 3 (citing
Abraham v. WPX Energy Prod., LLC, 322 F.R.D. 627, 668 (D.N.M. 2017)(Browning, J.)). The
Defendants quote the Court’s observation that the Federal Rules of Civil Procedure establish “a
jurisdiction phased de-escalation process wherein the district court goes from pre-final judgment
plenary jurisdiction, to limited review for the first twenty-eight days post-final judgment, and,
finally, to solely rule 60 review after twenty-eight days.”
Response at 3 (emphasis in
Response)(internal quotation marks omitted)(quoting Abraham v. WPX Energy Prod., LLC, 322
F.R.D. at 607). The Defendants also cite Thompson v. THI of New Mexico at Casa Arena,
wherein, according to the Defendants, the Court clarified that a plaintiff could not raise a claim
against a new party after the Court entered final judgment in the case. See Response at 3-4. The
Defendants argue:
In Thompson, the claim against the new party had not been adjudicated, and there
is no question that the plaintiff had a “nascent interest” in pursuing such a claim if
the plaintiff wished to do so. Neither the fact that there was a new, different party
nor a new, different interest (“nascent” or otherwise), however, meant that the case
should be reopened.
Response at 3-4. The Defendants contend that final judgments pose a jurisdictional obstacle and
that, where, as here, the Court has entered a final judgment, the Court’s jurisdiction is limited to
rule 60’s exceptions. See Response at 4. According to the Defendants, the Court has made clear
that, after the first twenty-eight days following a final judgment, like here, the Court can reopen a
case only under rule 60. See Response at 4 (citing Abraham v. WPX Energy Prod., LLC, 322
F.R.D. at 607). In the Defendants’ view, for this reason, the Court clarified that “intervention was
- 25 -
a ‘precondition’ for a motion to reopen a lawsuit.” Response at 4. The Defendants also cite for
support United States v. Kentucky Utilities Company, 927 F.2d 252 (6th Cir. 1991), in which the
United States Court of Appeals for the Sixth Circuit clarified that an intervenor must satisfy rule
60(b)(6) before obtaining relief. See Response at 4 (citing United States v. Ky. Utils Co., 927 F.2d
at 255).
The Defendants argue that the Basnet Intervenors cite no authority, and disparage the
Basnet Intervenors’ “policy” arguments. Response at 5. First, the Defendants contend that the
“interest in finality” is implicated here. Response at 5. The Defendants describe that, after the
Final Judgment, they “reasonably expected that that litigation was concluded, regardless of
whether other employees would file other lawsuits against them.” Response at 5. According to
the Defendants, they should receive the benefits of the Final Judgment, including the end of the
statute of limitations’ tolling, even if other employees might file suit. See Motion at 5. The
Defendants note that the Basnet Intervenors will receive more benefits from reopening this case
than from adhering to the Final Judgment, but, according to the Defendants, “[t]hat the Defendants
are the primary beneficiaries of the ‘interest in finality’ . . . does not make the interest any less
real.” Response at 5. The Defendants dispute that the Court should overlook rule 60 simply
because the Basnet Intervenors “believe . . . that the rules should be different than they are.”
Response at 5.
The Defendants contest that the Basnet Intervenors cannot satisfy rule 60. See Response
at 6. According to the Defendants, rule 60(b)(5) permits a court to relieve parties from a final
judgment when “the judgment has been satisfied, released or discharged.” Fed. R. Civ. P. 60(b)(5).
Response at 6. The Defendants argue that a plaintiff cannot use this rule to obtain relief from the
- 26 -
Final Judgment when the defendant has paid the judgment that it owes. See Response at 7.
According to the Defendants, “one treatise observed that this provision ‘has been relied on very
rarely,’ and the very few cases it cites all involve relieving defendants from judgment liability.”
Response at 7 (emphasis in Response)(quoting 11 Charles Alan Wright & Arthur R. Miller,
Federal Practice and Procedure § 2863 (3d ed. 2012)). The Defendants contend that the Basnet
Intervenors’ argument for applying rule 60 is illogical, because, under the Basnet Intervenors’
reasoning, a defendant could ensure finality only by not paying the judgment. See Response at 7.
The Defendants argue that such a rule would result in bad policy and that rule 60(b)(5) does not
fulfill the Basnet Intervenors’ desire, which is to be excused from finality but not from the
judgment. See Response at 7.
The Defendants describe 60(b)(6) as “a ‘residual catch-all’ that allows district courts to
relieve parties from final judgments for ‘any other reason that justifies relief.’” Response at 8
(quoting Fed. R. Civ. P. 60(b)(6)). The Defendants cite the Court’s summary of the rule:
“If the reasons offered for relief from judgment could be considered under one of
the more specific clauses of Rule 60(b)(1)-(5), those reasons will not justify relief
under Rule 60(b)(6).” 12 J[ames] Moore et al., Moore’s Federal Practice, Civil
§ 60.48[2], at 60-182 (3d ed. 2013). Accord Liljeberg v. Health Servs. Acquisition
Corp., 486 U.S. [847,] 863 n.11 [(1988)](“This logic, of course, extends beyond
clause (1) and suggests that clause (6) and clauses (1) through (5) are mutually
exclusive.”).
Response at 8 (quoting Intervention MOO at 37, 322 F.R.D. at 671). The Defendants argue that
some putative class members intervened in this case before the Court entered the Final Judgment
and that the Basnet Intervenors do not explain why they did not previously intervene; according to
the Defendants, “they [(the Basnet Intervenors)] simply did not do so.” Response at 8. The
Defendants aver: “Whether Plaintiffs characterize their failure to intervene earlier as a ‘mistake’
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or ‘inadvertence’ or ‘excusable neglect,’ those set of circumstances [sic] fall squarely within the
ambit of Rule 60(b)(1) and cannot be used to justify relief now, more than a year after the Final
Judgment was entered, under Rule 60(b)(6).” Response at 8 (citing Liljeberg v. Health Servs.
Acquisition Corp., 486 U.S. at 863 n.11; Intervention MOO at 37, 322 F.R.D. at 671).
The Defendants further describe that “circumstances must be ‘extraordinary’” to warrant
relief under 60(b)(6). Motion at 8 (quoting Intervention MOO at 38, 322 F.R.D. at 671). The
Defendants describe that the Bastian Plaintiffs acted entirely ordinary when they accepted the Final
Judgment and the Court entered the Final Judgment. See Response at 9. The Defendants argue:
“There is certainly nothing in the record to suggest that a natural disaster or any other crisis or
‘extraordinary’ act played any role in the timing of the motion or any of the other relevant
procedural events of this lawsuit.” Response at 9. Moreover, for the Defendants, “[e]ven
Plaintiffs’ assertion that ‘failure to permit intervention [sic] in this lawsuit could jeopardize the
legal claims of one or more Intervenors,’ which Defendants contend are not the kind of
‘extraordinary’ circumstances contemplated by the rule, is unexplained and unsupported.”
Response at 9 (footnote omitted)(sic in Response)(quoting Motion at 12). The Defendants note
that the Basnet Intervenors do not specify which claims will be jeopardized and how those claims
will be jeopardized. See Response at 9. According to the Defendants, the “Plaintiff [sic] have a
heavy burden; of satisfying the Rule 60(b)(6) requirements,” Response at 9 (quoting Mayberry v.
Maroney, 558 F.2d 1159 1163 (3d Cir. 1977)), and, in the Defendants’ view, the Basnet
Intervenors do not meet this burden. See Response at 9.
The Defendants aver, moreover, that “the United States Supreme Court has made clear that
if a party is even partly at fault, Rule 60(b)(6) relief does not apply.” Response at 9 (emphasis in
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Response)(citing Pioneer Inv. Servs. Co. v. Brunswick Associates Ltd., 507 U.S. 380, 393 (1993)).
Response at 9. According to the Defendants, the Basnet Intervenors controlled when they filed
the Motion to Intervene and the Supp. Motion to Intervene, so the Basnet Intervenors bear
responsibility for their situation and cannot obtain relief under rule 60(b)(6). See Response at 9.
The Defendants argue that the Basnet Intervenors avoid this problem by putting responsibility on
the Bastian Plaintiffs, see Response at 10; according to the Defendants, “[e]ven if Plaintiffs could
convince the Court that others are partly responsible . . . that would not justify applying the rule.
Partial responsibility is enough to deny relief under Rule 60(b)(6),” Response at 10 (citing Motion
at 5; Schwartz v. United States, 976 F.2d 213 (4th Cir. 1992)). The Defendants continue, arguing
that the Basnet Intervenors cannot distance themselves from the Bastian Plaintiffs. See Response
at 10. The Defendants allege that the Bastian Plaintiffs knew and understood their roles as class
representatives. See Response at 10. According to the Defendants, for instance, the Bastian
Plaintiffs confirmed in the Plaintiffs’ Reply to Motion for Class Certification, filed June 27, 2016
(Doc. 134), that each named plaintiff understood his or her role as a class representative. See
Response at 10 (citing Plaintiffs’ Reply to Motion for Class Certification at 10-11).
The
Defendants advocate that the Court should read the Final Judgment with the assumption that the
class representatives understood their responsibilities to the class. See Response at 10. According
to the Defendants, the Bastian Plaintiffs did not control when the Basnet Intervenors chose to
intervene, and the Defendants note that the same attorneys represented the Bastian Plaintiffs as
represent the Basnet Intervenors and that those attorneys should have been able to easily coordinate
strategy. See Response at 11.
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4.
The Reply.
In reply, the Basnet Intervenors reiterate their arguments from the Motion. See Reply to
Response in Support of Motion to Address Issue of Fed. R. Civ. P. 60 for Intervenors to Proceed
with Third Amended Complaint or, Alternatively Fed. R. Civ. P. 60(B) Motion to Obtain Relief
from Judgment at 2, filed September 14, 2018 (Doc. 211)(“Reply”). The Basnet Intervenors argue
that they “are not inventing a differential fiction here”; according to the Basnet Intervenors, “case
law, treatises, manuals, pocket guides and law review articles . . . confirm” that class action
lawsuits differ from other lawsuits. Reply at 3. The Basnet Intervenors describe that “the Tenth
Circuit itself, as well its sister circuits, has expressly recognized the ‘nascent interest’ of the class
members that obtains with the filing of the class action lawsuit and, by relation and extension, a
filed but yet undecided motion for class certification.” Reply at 3 (citing Lucero v. Bureau of
Collection Recovery Inc., 639 F.3d 1239 (10th Cir. 2011)).
The Basnet Intervenors contend that the Defendants do not address how the Final Judgment
binds the putative class members. See Reply at 3. According to the Basnet Intervenors, the Final
Judgment could not “bring finality to the putative class members’ claims.” Reply at 3. The Basnet
Intervenors indicate neither party cites a case on point, “in which putative class members are
seeking to pick up a class action lawsuit that was left unresolved.” Response at 4. The Basnet
Intervenors summarize that, in Thompson v. THI of New Mexico at Casa Arena, the named party
sought to add an additional claim against a new defendant. See Response at 4. The Basnet
Intervenors differentiate United States v. Kentucky Utilities Company, arguing that the plaintiff in
United States v. Kentucky Utilities Company sought to modify the settlement agreement and that
the case “involved a final judgment on all of the issues presented in the underlying lawsuit, and a
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third party sought to attack a specific portion of it.” Reply at 4 (emphasis in original). According
to the Basnet Intervenors, here, “settlement and final judgment . . . specifically did not resolve the
putative class members’ claims or even seek to extinguish the putative class members’ rights.”
Reply at 4.
The Basnet Intervenors contend that they face potential harm, because the Defendants will
argue that American Pipe tolling, does not protect all the Basnet Intervenors’ claims. See Reply
at 5.
The Basnet Intervenors describe:
Defendants intend to argue either for no tolling of the three (3) year statute of
limitations on the NMMWA claims or for limited tolling in order to pick off certain
plaintiffs and/or class members if Plaintiffs are forced to seek relief for themselves
and the class only through the later-filed Bell lawsuit.
Reply at 5.
The Basnet Intervenors insist that they can satisfy rule 60. See Reply at 5. The Basnet
Intervenors contend that, even if defendants are more likely seek to seek relief under rule 60(b)(5),
the rule is not intended to benefit solely defendants. See Reply at 5. The Basnet Intervenors
indicate that Gibbs v. Maxwell House, A Division of General Foods Corp. “nowhere provides that
rule 60(b)(5) only serves as a procedural tool for a defendant.” Reply at 5. The Basnet Intervenors
contend that the their “principal point is that because the judgment has been satisfied, there will be
no disturbance whatsoever in that portion of the lawsuit that was resolved between the five Bastian
plaintiffs and the two Defendants.” Reply at 6. According to the Basnet Intervenors, the Final
Judgment will remain intact and the Court “will not have to alter, modify or amend the benefit to
which the parties bargained.” Reply at 6. To the Defendants’ concerns about applying rule
60(b)(5) here, the Basnet Intervenors reply that a party can file “for writs of garnishment and
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execution, along with post-judgment discovery,” to obtain rapid enforcement of the judgment.
Reply at 6. The Basnet Intervenors continue:
As a secondary concern, if enough time passes and the defendant refuses to
satisfy the Rule 68 offer, it invites a Rule 60(b)(3) motion on the grounds that the
Rule 68 offer constituted a fraud and/or misrepresentation. In either the first or the
second case, the defendant against whom judgment was taken is faced with
additional costs, attorney’s fees and the like for the failure to satisfy a Rule 68 offer
promptly.
Reply at 6. The Basnet Intervenors argue that a defendant will not likely delay in paying a
judgment anyway. See Reply at 6. The Basnet Intervenors summarize that class action defendants
often prefer to pay the judgment quickly and “hope that the clock continues to tick on any other
class claims.” Reply at 6-7.
Regarding rule 60(b)(6), the Basnet Intervenors contend that the rule “does not require a
‘natural disaster or any other crises,’” as the Defendants suggest. See Reply at 7 (quoting Response
at 9; and citing Smith v. United States, 561 F.3d at 1096 n.8). The Basnet Intervenors allege that
the Defendants know that the Court’s preclusion of the Third Amended Complaint will prejudice
the Basnet Intervenors. See Reply at 7. The Intervenors argue: “The fact remains that select
individuals who were intentionally paid improperly and in derogation of the NMMWA may lose
out on relief because of time, not merits. That, coupled with the arguments in the motion, support
Rule 60(b)(6) relief.” Reply at 7.
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5.
The Hearing.
The Basnet Intervenors admitted that they could not locate a case that is on point. See
Draft Hearing of Transcript at 3:1-13 (taken September 26, 2019)(Stanford)(“Sep. 26 Tr.”).9 The
Intervenors described that the closest case that they could locate was Lusardi v. Xerox Corp.,
wherein, after the plaintiffs stipulated to dismiss the case, the intervenors tried to file a class
certification motion. See Sep. 26 Tr. at 3:14-22 (Stanford). According to the Basnet Intervenors,
the Third Circuit held that the intervenors could not file the motion, but noted that, if a class
certification motion had been pending, the intervenors could have picked up and argued that
pending motion. See Sep. 26 Tr. at 3:23-4:3 (Stanford).
The Basnet Intervenors emphasized that this case differs from other circumstances in which
a court has entered a final judgment, because, according to the Basnet Intervenors, the Final
Judgment here reflects an agreement that only the Bastian Plaintiffs made with the Defendants and
that left the putative class members with their nascent interest in this case. See Sep. 26 Tr. at 4:95:9 (Stanford). The Basnet Intervenors stressed that the Bastian Plaintiffs had no authority to
extinguish the class action or to settle the putative class members’ claims. See Sep. 26 Tr. at 5:1018 (Stanford). The Basnet Intervenors reiterated that courts are sensitive to putative class
members’ interests, and frequently allow a putative class member to “pick up the case and not have
some kind of obstacle for their ability to do so.” Sep. 26 Tr.at 6:4-6 (Stanford). The Basnet
Intervenors argued that, initially, the Court and the parties had a sense that rule 60 would not
obstruct the Basnet Intervenors’ prosecution of the case, and, according to the Basnet Intervenors,
9
The Court’s citations to the transcript of the hearing refer to the court reporter’s original,
unedited version. Any final transcript may contain slightly different page and/or line numbers.
- 33 -
this sense is evidence that the Basnet Intervenors can proceed, because the Intervention MOO
permits the Basnet Intervenors to intervene and to file the Third Amended Complaint, and the
Defendants asked for additional time in which to answer the Third Amended Complaint. See Sep.
26 Tr. at 6:6-16 (Stanford).
Alternatively, the Basnet Intervenors contended that they can satisfy rules 60(b)(5) and (6).
See Sep. 26 Tr. at 7:1-2 (Stanford). The Basnet Intervenors summarized that they deserve relief,
because, if they cannot in this case, the Defendants will argue that American Pipe tolling bars some
of their claims. See Sep. 26 Tr. at 7:2-23 (Stanford). The Basnet Intervenors could not estimate
the number of claims that such arguments would affect, but the Basnet Intervenors expressed their
goal for all class members to receive the compensation that they deserve. See Sep. 26 Tr. at 8:79:4 (Stanford). Lastly, the Plaintiffs argued that they can satisfy 60(b)(5), because, according to
the Basnet Intervenors, “the rule says what it says.” Sep. 26 Tr. at 9:4-5 (Stanford). The Basnet
Intervenors averred:
It’s within the discretion of the Court to set aside a judgment if that’s
the . . . procedural mechanism that is necessary here for the intervenors to
intervene[.] . . . [T]he Court can do so when the judgment has been satisfied, and
there is no, as I put in the reply brief, there is no special provision in there that says
that’s only for defendant to use that particular [provision].
Sep. 26 Tr. at 9:5-13 (Stanford).
The Court asked what the Basnet Intervenors envisioned doing in this case if the Court
permits them to prosecute the Third Amended Complaint. See Sep. 26 Tr. at 10:16-18 (Court).
The Court continued, questioning whether, although it has entered the Final Judgment, the Basnet
Intervenors imagined having an initial scheduling conference and trial in this case. See Sep. 26
Tr. at 10:20-23 (Court). The Basnet Intervenors explained that this case would proceed in parallel
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with the Bell case, with some discovery and a class certification motion. See Sep. 26 Tr. at 10:2411:18 (Court). The Court wondered about proceeding through an entire case after the Final
Judgment’s entry:
Are we [running] real risk by having a final judgment sitting there. The Tenth
[Circuit] teaches courts that that’s a very important thing to them, a final judgment
there. Are they just going to say sorry guys, that was very interesting down there,
I don’t know what y’all were doing, but we don’t . . . have jurisdiction because it
ran a long time ago.
Sep. 26 Tr. at 11:19-12:6 (Court). The Basnet Intervenors stated that they could not imagine in
what scenario the Court’s prediction would occur. See Sep. 26 Tr. at 12:7-9 (Stanford). The Court
replied: “It may be a great situation for me; nobody can [appeal] me, you know, so it may be
judgment proof for whatever I do for that. But it seems to me it may put both of you guys at risk.”
Sep. 26 Tr. at 12:10-13 (Court). The Basnet Intervenors responded that they could not envision
what an appeal would look like, because: (i) the Court made one substantive decision in this case,
and the Basnet Intervenors could not imagine appealing that decision, and (ii) the Basnet
Intervenors saw no grounds for attacking the Paynes’ settlement or the Final Judgment, because
both were settlements to which the named plaintiffs and the Defendants had agreed. See Sep. 26
Tr. at 12:14-13:13 (Stanford).
The Defendants summarized that the Basnet Intervenors propose “a class action exception
to the final judgment rule” and that the Defendants contend that no such exception exists. Sep. 26
Tr. at 14:14-15 (Lowry). See id. at 14:14-18 (Lowry). The Defendants argued that the Court
recognized no class action exception to the final judgment in Abraham v. WPX Energy Production,
LLC, which the Court issued the same day as the Intervention Motion. See Sep. 26 Tr. at 14:2215:7 (Lowry). The Defendants contended that the Basnet Intervenors envision a case with multiple
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final judgments and indicate that, if the Tenth Circuit concludes that the Court lacks jurisdiction
after the first final judgment, “anything that happened after that [final judgment]” might be
inoperative. Sep. 26 Tr. at 16:1-5 (Lowry).
The Defendants argued that rule 60(b)(5) does not apply. See Sep. 26 Tr. at 16:12-13
(Lowry). The Defendants stated that they found no cases in which a plaintiff successfully set aside
a final judgment under rule 50(b)(5). See Sep. 26 Tr. at 16:14-17 (Lowry). The Defendants
reiterated their arguments from their Response that the Basnet Intervenors’ stance leads to absurd
results, and that the Basnet Intervenors want to set aside the finality rule and not the Final
Judgment. See Sep. 26 Tr. at 16:17-17:9 (Lowry). The Defendants also argued that the Basnet
Intervenors do not carry their burden under rule 60(b)(6) for three reasons: (i) that the Basnet
Intervenors did not intervene earlier “could be characterized as a mistake or as inadvertence or as
excus[able neglect],” Sep. 26 Tr. at 17:15-16 (Lowry), and the Basnet Intervenors are outside the
timeframe for rule 60(b)(1), which addresses those issues, and cannot seek relief under 60(b)(6),
see Sep. 26 Tr. at 17: 12-23; (ii) for rule 60(b)(6) to apply, the circumstances leading to the final
judgment must be extraordinary, and the Defendants dispute the Basnet Intervenors’ contention
that this case is extraordinary because a statute of limitations will apply if the Court does not set
aside the Final Judgment, Sep. 26 Tr. at 17:23-18:9 (Lowry); and (iii) “if a party is even partly at
fault for the circumstances leading to the final judgment then Rule 60(b)[(6)] cannot be used to
undue it,” Sep. 26 Tr. at 18:9-12 (Lowry), and the Basnet Intervenors are partly at fault because
they could have intervened earlier, see Sep. 26 Tr. at 18:12-18.
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The Court indicated that it had heavily relied on United Airlines v. McDonald10 in granting
the Intervention Motion and asked the Defendants if they remembered what had occurred after the
intervention in that case. See Sep. 26 Tr. at 18:22-19:8 (Court). The Defendants replied that they
did not know to which case the Court was referring. See Sep. 26 Tr. at 19:16-20 (Lowry).
The Basnet Intervenors summarized that they seek “relief as to finality.” Sep. 26 Tr. at
20:9-10 (Stanford). They admitted that their request differs from other rule 60 motions, because
they do not want to change the Final Judgment. See Sep. 26 Tr. at 20:17-24 (Stanford). The
Basnet Intervenors explained that the concern “really is the statute of limitations and its impact on
the timing,” Sep. 26 Tr. at 21:1-2 (Stanford), and that, if the Court and the Defendants worry that
the Final Judgment precludes the Court from acting unless it reobtains jurisdiction under rule 59
or rule 60, the Basnet Intervenors will seek relief under rule 60, see Sep. 26 Tr. at 21:3-16
(Stanford).
The Court concluded that it needed to “thin[k] . . . about this some more.” Sep. 26 Tr. at
21:18. The Court explained that United Airlines v. McDonald dictates that the Court allow the
Basnet Intervenors to intervene, but that the Court is not sure whether United Airlines v. McDonald
requires it to permit the Basnet Intervenors to proceed with this case. See Sep. 26 Tr. at 21:22-25
(Court). The Court indicated that, unless United Airlines v. McDonald requires such proceedings,
the Court tends to agree with the Defendants that a case cannot have two final judgments. See
Sep. 26 Tr. at 22:1-5 (Court). The Court noted that multiple final judgments are permitted if the
10
In the interest of portraying the hearing accurately, the Court notes that, at the hearing,
the Court and the parties could not remember the name of this case. See Sep. 26 Tr. at 18:22-23
(Court); id. at 19:16-18 (Lowry). The name of the case is United States v. McDonald, and the
Court will use the name in the text.
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Court certifies them under rule 54(b) of the Federal Rules of Civil Procedure but that, in this case,
the Court and the parties did not take the steps for such certification. See Sep. 26 Tr. at 22:5-11
(Court). The Court indicated that it was inclined to deny the Motion but that it would further
consider the issue. See Sep. 26 Tr. at 23:3-9 (Court). The Court also stated that 60(b)(5) likely
does not apply, see Sep. 26 Tr. at 23:9-11 (Court), and that the 60(b)(6) standard is “a pretty high
standard,” Sep. 26 Tr. at 23:12. The Court issues this Memorandum Opinion and Order after
further consideration of the issues.
LAW REGARDING FINAL JUDGMENTS
“A final decision is one that ‘ends the litigation on the merits and leaves nothing for the
court to do but execute the judgment.’” Rekstad v. First Bank Sys., 238 F.3d at 1261 (quoting
Catlin v. United States, 324 U.S. 229, 233 (1945)). “A final judgment terminates the Court’s
jurisdiction over the main case -- those claims over which the Court has original, pendent, or
pendent-party jurisdiction.” Pedroza v. Lomas Auto Mall, Inc., 304 F.R.D. at 333-34. With few
exceptions, “federal appellate courts have jurisdiction solely over appeals from ‘final decisions of
the district courts of the United States.’” Rekstad v. First Bank Sys., 238 F.3d at 1261 (internal
quotation marks omitted)(emphasis in original)(quoting 28 U.S.C. § 1291).
Where a suit involves multiple claims, the district court must, pursuant to rule 54(b),
“adjudicate every claim before the court’s decision can be considered final and appealable.”
Rekstad v. First Bank Sys., 238 F.3d at 1261 (citing Fed. R. Civ. P. 54(b)). In certain, limited
circumstances, however, the district court “may direct the entry of final judgment as to one or more
but fewer than all the claims” to secure immediate appellate review of certified final orders.
Rekstad v. First Bank Sys., 238 F.3d at 1261 (internal quotation marks omitted)(quoting Fed. R.
- 38 -
Civ. P. 54(b)). Otherwise, appellate review is foreclosed until all claims have been terminated on
the merits. See Rekstad v. First Bank Sys., 238 F.3d at 1261.
Under rule 58(a) of the Federal Rules of Civil Procedure, “[e]very judgment and amended
judgment must be set out in a separate document,” save for orders disposing of certain motions.
Fed. R. Civ. P. 58. A final judgment “must be a self-contained document, saying who has won
and what relief has been awarded, but omitting the reasons for this disposition, which should
appear in the court’s opinion.”
In re Taumoepeau, 523 F.3d 1213, 1217 n.5 (10th Cir.
2008)(internal quotation marks)(quoting Moore’s Federal Practice §58.05[4][a]). The Supreme
Court has stated that the separate-document rule must be “mechanically applied” in determining
whether an appeal is timely. Allison v. Bank One-Denver, 289 F.3d 1223, 1232-33 (10th Cir.
2002)(internal quotation marks omitted)(quoting Bankers Tr. Co. v. Mallis, 435 U.S. 381, 386
(1978)). “Strict application of Rule 58 eliminates any question as to when the clock for filing post
judgment motions . . . begins to tick. Orders disposing of certain enumerated motions, including
post judgment motions under Fed. R. Civ. P. 59 and 60, are excepted from Rule 58’s separate
judgment requirement.” Warren v. Am. Bankers Ins. of Fla., 507 F.3d 1239, 1242 (10th Cir. 2007).
Thus, the Tenth Circuit “strictly adhere[s] to the Supreme Court’s directive to apply Rule 58
‘mechanically.’” Warren v. Am. Bankers Ins. of Fla., 507 F.3d at 1243.
Final judgments implicate two important concerns militating against giving district courts
free reign to reconsider their judgments. First, when a case is not appealed, there is an interest in
finality. The parties and the lawyers expect to go home, quit obsessing over the dispute, and put
the case behind them, and the final judgment -- especially once the twenty-eight-day window of
robust district court review and the thirty-day window of appeal have both closed -- is the
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disposition upon which they are entitled to rely. Second, when a case is appealed, there is the need
for a clean jurisdictional handoff from the district court to the Court of Appeals. “[A] federal
district court and a federal court of appeals should not attempt to assert jurisdiction over a case
simultaneously,” as doing so produces a “danger [that] a district court and a court of appeals w[ill]
be simultaneously analyzing the same judgment.” Griggs v. Provident Consumer Disc. Co., 459
U.S. 56, 58-59 (1982).
The “touchstone document” for this jurisdictional handoff is the notice of appeal, not the
final judgment, Griggs v. Provident Consumer Disc. Co., 459 U.S. at 58 (“The filing of a notice
of appeal is an event of jurisdictional significance -- it confers jurisdiction on the court of appeals
and divests the district court of its control over those aspects of the case involved in the appeal.”
(citations omitted)); Garcia v. Burlington N. R.R., 818 F.2d 713, 721 (10th Cir. 1987)(“Filing a
timely notice of appeal . . . transfers the matter from the district court to the court of appeals. The
district court is thus divested of jurisdiction. Any subsequent action by it is null and void.”
(citations omitted)); Kirtland v. J. Ray McDermott & Co., 568 F.2d 1166, 1170 (5th Cir.
1978)(“[I]t is the filing of the appeal, not the entering of a final judgment, that divests the district
court of jurisdiction.” (citations omitted)), but, because the final judgment starts the parties’ thirtyday clock for filing a timely notice of appeal, the Federal Rules of Civil Procedure and the Tenth
Circuit have chosen to curtail the district court’s jurisdiction over the case in the roughly monthlong period of potentially overlapping trial- and appellate-court jurisdiction that immediately
follows the entry of final judgment, see Servants of the Paraclete v. Does, 204 F.3d 1005, 1009
(10th Cir. 2000)(noting that post-final judgment motions at the district court level are “not intended
to be a substitute for direct appeal”). Rather than suddenly divesting the district court of all
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jurisdiction over the case -- potentially resulting in the district court being unable to rectify easily
fixable problems with the final judgment before the case goes to the Tenth Circuit, or even
requiring appeal of a case that might otherwise not need to be appealed -- the Federal Rules set
forth a jurisdiction phased de-escalation process, wherein the district court goes from pre-final
judgment plenary jurisdiction, to limited review for the first twenty-eight days post-final judgment,
and, finally, to solely rule 60 review after twenty-eight days.
LAW REGARDING MOTION TO ALTER OR AMEND UNDER RULE 59(E)
Motions to reconsider in civil cases fall into three categories:
(i) a motion to reconsider filed within twenty-eight[11] days of the entry of judgment
is treated as a motion to alter or amend the judgment under rule 59(e); (ii) a motion
to reconsider filed more than [twenty-eight] days after judgment is considered a
motion for relief from judgment under rule 60(b); and (iii) a motion to reconsider
any order that is not final is a general motion directed at the Court’s inherent power
to reopen any interlocutory matter in its discretion.
Pedroza v. Lomas Auto Mall, Inc., 258 F.R.D. at 462 (citing Price v. Philpot, 420 F.3d 1158, 1167
& n.9 (10th Cir. 2005)). See Computerized Thermal Imaging, Inc. v. Bloomberg. L.P., 312 F.3d
1292, 1296 n.3 (10th Cir. 2002).
11
Former rule 59 provided for a ten-day period after entry of judgment to file motions to
reconsider. In 2009, the rule was amended, extending the filing period to twenty-eight days:
Experience has proved that in many cases it is not possible to prepare a satisfactory
post-judgment motion in 10 days, even under the former rule that excluded
intermediate Saturdays, Sundays, and legal holidays. These time periods are
particularly sensitive because Appellate Rule 4 integrates the time to appeal with a
timely motion under these rules. Rather than introduce the prospect of uncertainty
in appeal time by amending Rule 6(b) to permit additional time, the former 10-day
periods are expanded to 28 days.
Fed. R. Civ. P. 59 advisory committee’s notes.
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Whether a motion for reconsideration should be considered a motion under rule 59 or rule
60 is not only a question of timing, but also “depends upon the reasons expressed by the movant.”
Commonwealth Prop. Advocates, LLC v. Mortg. Elec. Registration Sys., Inc., 680 F.3d 1194,
1200 (10th Cir. 2011).
Where the motion “involves ‘reconsideration of matters properly
encompassed in a decision on the merits,’” a court considers the motion under rule 59(e). Phelps
v. Hamilton, 122 F.3d 1309, 1323-24 (10th Cir. 1997)(quoting Martinez v. Sullivan, 874 F.2d 751,
753 (10th Cir. 1989)). In other words, if the reconsideration motion seeks to alter the district
court’s substantive ruling, then it should be considered a rule 59 motion and be subject to rule 59’s
constraints. See Phelps v. Hamilton, 122 F.3d at 1324. “[A] motion for reconsideration is
appropriate where the court has misapprehended the facts, a party’s position, or the controlling
law.” Servants of Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir. 2000). A motion to alter or
amend under rule 59(e), however, is an “inappropriate vehicle[] to reargue an issue previously
addressed by the court when the motion merely advances new arguments, or supporting facts
which were available at the time of the original motion.” Servants of Paraclete v. Does, 204 F.3d
at 1012. A district court has considerable discretion in ruling on a motion to reconsider. See
Phelps v. Hamilton, 122 F.3d at 1324.
The Tenth Circuit reviews a district court’s ruling on a motion to alter or amend “under an
abuse of discretion standard.” Phelps v. Hamilton, 122 F.3d at 1324. Under that standard “a trial
court’s decision will not be disturbed unless the appellate court has a definite and firm conviction
that the lower court made a clear error of judgment or exceeded the bounds of permissible choice
in the circumstances.” 122 F.3d at 1324. “The purpose [of a rule 59(e)] motion is to correct
manifest errors of law or to present newly discovered evidence.” Monge v. RG Petro-Machinery
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(Group) Co. Ltd., 701 F.3d 598, 611 (10th Cir. 2012)(internal quotation marks omitted)(quoting
Webber v. Mefford, 43 F.3d 1340, 1345 (10th Cir. 1994)). “Where the motion requests a
substantive change in the district court’s judgment or otherwise questions its substantive
correctness, the motion is a Rule 59 motion, regardless of its label.” Yost v. Stout, 607 F.3d 1239,
1243 (10th Cir. 2010).
The Tenth Circuit has determined that the “law of the case doctrine has no bearing on the
revisiting of interlocutory orders, even when a case has been reassigned from one judge to
another.” Rimbert v. Eli Lilly & Co., 647 F.3d 1247, 1252 (10th Cir. 2011)(citing Been v. O.K.
Indus., Inc., 495 F.3d at 1225). In this context, “the doctrine is merely a ‘presumption, one whose
strength varies with the circumstances.’” Been v. O.K. Indus., Inc., 495 F.3d at 1225 (quoting
Avitia v. Metro. Club of Chi., Inc., 49 F.3d 1219, 1227 (7th Cir. 1995)). “[D]istrict courts
generally remain free to reconsider their earlier interlocutory orders.” Been v. O.K. Indus., 495
F.3d at 1225. In short, a district court can use whatever standard it wants to review an earlier
interlocutory order. It can review the earlier ruling de novo and essentially reanalyze the earlier
motion from scratch, it can review the ruling de novo but limit its review, it can require parties to
establish one of the law-of-the-case grounds, or it can refuse to entertain motions to reconsider
altogether.
The best approach, in the Court’s eyes, is to analyze motions to reconsider differently
depending on three factors. Cf. Been v. O.K. Indus., Inc., 495 F.3d at 1225 (“[T]he doctrine is
merely a ‘presumption, one whose strength varies with the circumstances.’” (quoting Avitia v.
Metro. Club of Chi., Inc., 49 F.3d 1219, 1227 (7th Cir. 1995)). First, the Court should restrict its
review of a motion to reconsider a prior ruling in proportion to how thoroughly the earlier ruling
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addressed the specific findings or conclusions that the motion to reconsider challenges. How
“thoroughly” a point was addressed depends both on the amount of time and energy the Court
spent on it, and on the amount of time and energy that the parties spent on it -- in briefing and
orally arguing the issue, but especially if they developed evidence on the issue. A movant for
reconsideration thus faces a steeper uphill challenge when the prior ruling was on a criminal
suppression motion, class certification motion, or preliminary injunction,12 than when the prior
ruling is, e.g., a short discovery ruling. The Court should also look, not to the prior ruling’s overall
thoroughness, but to the thoroughness with which the Court addressed the exact point or points
that the motion to reconsider challenges. A movant for reconsideration thus faces an easier task
when he or she files a targeted, narrow-in-scope motion asking the Court to reconsider a small,
discrete portion of its prior ruling than when he or she files a broad motion to reconsider that
rehashes the same arguments from the first motion, and essentially asks the Court to grant the
movant a mulligan on its earlier failure to present persuasive argument and evidence.
12
The Court typically makes findings of fact and conclusions of law in ruling on these
motions. At first glance, it appears that the Federal Rules of Civil Procedure set forth additional
standards -- beyond that which applies to other interlocutory orders -- for amending findings of
fact and conclusions of law: “Amended or Additional Findings. On a party’s motion filed no
later than 28 days after the entry of judgment, the court may amend its findings -- or make
additional findings -- and may amend the judgment accordingly. The motion may accompany a
motion for a new trial under Rule 59.” Fed. R. Civ. P. 52(b). This rule appears to limit motions
to reconsider orders with findings of fact and conclusions of law to twenty-eight days. The rule’s
use of the term “entry of judgment,” its reference to rule 59, and its adoption of the same time
period that applies to motions to alter or amend a judgment, all lead the Court to conclude,
however, that rule 52(b) -- and its twenty-eight-day time limit -- does not apply to interlocutory
orders. The time limit applies only to findings of fact and conclusions of law supporting a caseending judgment -- such as those entered after a bench trial -- and to those giving rise to an
interlocutory appeal that, if filed, divests the district court of its jurisdiction -- such as those entered
in support of a preliminary injunction.
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Second, the Court should consider the case’s overall progress and posture, the motion for
reconsideration’s timeliness relative to the ruling it challenges, and any direct evidence that the
parties may produce, and use those factors to assess the degree of reasonable reliance which the
opposing party has placed in the Court’s prior ruling. See 18B Charles Alan Wright, et al., Federal
Practice & Procedure § 4478.1 (2d ed. 2018)(“Stability becomes increasingly important as the
proceeding nears final disposition . . . . Reopening should be permitted, however, only on terms
that protect against reliance on the earlier ruling.”). For example, if a defendant (i) spends tens of
thousands of dollars removing legacy computer hardware from long-term storage; then (ii) obtains
a protective order in which the Court decides that the defendant need not produce the hardware in
discovery; then (iii) returns the hardware to long-term storage, sustaining thousands more in
expenses; and (iv) several months pass, then the plaintiffs should face a higher burden in moving
the Court to reconsider its prior ruling than they faced in fighting the motion for protective order
the first time.
Third, the Court should consider the factors from Servants of the Paraclete v. Does. The
Court should be more inclined to grant motions for reconsideration if the movant presents (i) new
controlling authority -- especially if the new authority overrules prior law or sets forth an entirely
new analytical framework; (ii) new evidence -- especially if the movant has a good reason why
the evidence was not presented the first time around; or (iii) a clear indication -- one that manifests
itself without the need for in-depth analysis or review of the facts -- that the Court erred.
These three factors should influence the degree to which the Court restricts its review of a
prior ruling, but they do not necessarily mean that the Court should always apply a deferential
standard of review. The Court should pause before applying a standard of review to its own
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interlocutory orders that is more deferential than the standard that the Court of Appeals will apply
to it, unless the Court concludes that the alleged error in the prior ruling was harmless, or the party
moving for reconsideration waived its right to appeal the alleged error by not raising the
appropriate argument. Even in circumstances where the Court concludes that it is insulated from
reversal on appeal, there are principled reasons for applying a de novo standard. After all, if the
Court was wrong in its earlier decision, then, generally speaking, it is unjust to maintain that result
-- although the Court should weigh this injustice against any injustice that would result from
upending the parties’ reliance on the earlier ruling, which is the balancing test that the three factors
above represent.
What the Court means by “restricting its review” is less about applying a deferential
standard of review -- although that may be appropriate in some circumstances -- and more about
reducing (i) the depth of the Court’s analysis the second time around -- thus conserving judicial
resources; and (ii) the impositions that relitigation of the prior ruling will impose on the party
opposing the motion for reconsideration. The Court should consider the time and expense that the
party opposing reconsideration spent in winning the earlier ruling, and should try to prevent that
party from having to bear the same impositions again. Basically, even if the Court ultimately
analyzes a motion to reconsider under the same standard which it analyzed the motion that
produces the earlier ruling, it should analyze the motion in a different way -- one focused on
reducing the litigation burdens of the party opposing reconsideration. For example, when a party
moves the Court for a preliminary injunction, standard practice is that the Court holds an
evidentiary hearing as a matter of course, regardless whether it looks as if the party has a good
chance of prevailing. If the party loses and the Court denies the injunction, however, and the party
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moves for reconsideration, the party should not be entitled to the presumption of an evidentiary
hearing merely because he or she received that presumption the first time the Court considered the
motion.
In light of these statements, it is perhaps better to characterize the increased burden that a
movant for reconsideration faces as one of production and not of persuasion. The Court analyzes
motions to reconsider by starting where it ended in the prior ruling -- not by starting anew. Parties
opposing reconsideration can do the same, and they may stand on whatever evidence and argument
they used to win the earlier ruling. Movants for reconsideration, on the other hand, carry the full
burden of production: they must persuade the Court, using only the evidence and argument they
put before it, that it should change its prior ruling; they must do all of the legwork, and not rely on
the Court to do any supplemental fact-finding or legal research; and they must convincingly refute
both the counterarguments and evidence that the opposing party used to win the prior ruling and
any new arguments and evidence that the opposing party produces while opposing the motion to
reconsider. Unlike the motion that produced the prior ruling, a motion to reconsider is not -- and
is not supposed to be -- a fair fight procedurally. The deck is stacked against a movant for
reconsideration, and if such a movant hopes to prevail, he or she must have not only a winning
legal position, but the work ethic and tenacity to single-handedly lead the Court to his or her way
of thinking.
The Court has recently commented on parties rearguing the same issues on a rule 59(e)
motion:
Under rule 59(e)’s framework, the Court is not restricted to rule 50(b)’s remedies
and may alter the judgment when there is: “(1) an intervening change in the
controlling law, (2) new evidence previously unavailable, [or] (3) the need to
correct clear error or prevent manifest injustice.” Servants of Paraclete v. Does,
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204 F.3d at 1012. The Tenth Circuit has noted that motions to alter, amend, or
reconsider should not rehash old arguments, or advance new arguments or facts that
could have been raised earlier. See United States v. Amado, 841 F.3d [867], 871
[(10th Cir. 2016)](“A proper motion to reconsider does not simply state facts
previously available or make arguments previously made.”); Servants of Paraclete
v. Does, 204 F.3d at 1012 (“Thus, a motion for reconsideration is appropriate where
the court has misapprehended the facts, a party’s position, or the controlling law.
It is not appropriate to revisit issues already addressed or advance arguments that
could have been raised in prior briefing.”). As the Court has already noted, the
Defendants’ Motion raises the same arguments that the Defendants previously
argued during their Motion to Alter. The Court, however, also concludes that
Servants of Paraclete v. Does does not force the Court to deny a motion to amend
or alter, simply because it raises identical issues; rather, it affords the Court the
option to deny that motion for reasons of judicial efficiency. A court need not
review a motion to alter or amend with the same rigor if the motion raises issues
already considered, because it would waste time by forcing a judge to rewrite an
opinion already rendered. If, on the other hand, a party raises an identical issue on
a motion to alter, and, upon the district judge’s reflection, perhaps after passions
have cooled, he or she concludes that he or she erred previously, Servants of
Paraclete v. Does does not chain that district judge to an erroneous legal conclusion.
There is no sound reason for a district judge to be unable to change a ruling he or
she has made if he or she has become concerned that he or she is wrong.
Nelson v. City of Albuquerque, 283 F. Supp. 3d 1048, 1099 (D.N.M. 2017)(Browning, J.)(altering
a judgment, because officers were entitled to qualified immunity).
LAW REGARDING RULE 60(b)
Rule 60(b) allows a court to relieve a party from a judgment or order. See Fed. R. Civ. P.
60(b). “Rule 60(b) is an extraordinary procedure permitting the court that entered judgment to
grant relief therefrom upon a showing of good cause within the rule.” Cessna Fin. Corp. v.
Bielenberg Masonry Contracting, Inc., 715 F.2d 1442, 1444 (10th Cir. 1983). Rule 60(b) “is not
a substitute for appeal and must be considered with the need for finality of judgment.” Cessna Fin.
Corp. v. Bielenberg Masonry Contracting, Inc., 715 F.2d at 1444 (citing Brown v. McCormick,
608 F.2d 410, 413 (10th Cir. 1979)). The rule was designed to strike a “delicate balance” between
respecting the finality of judgment and, at the same time, recognizing the court’s principal interest
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of executing justice. Cessna Fin. Corp. v. Bielenberg Masonry Contracting, Inc., 715 F.2d at 1444
(quoting Seven Elves, Inc. v. Eskenazi, 635 F.2d 396, 401 (5th Cir. 1981)). Once a case is
“unconditionally dismiss[ed],”13 the Court loses all jurisdiction over the case other than the ability
13
Rule 41(a)(2), which governs all dismissals undertaken by way of a court order, grants
courts discretion to condition dismissal “on terms that the court considers proper,” Fed. R. Civ. P.
41(a)(2), formerly, “on terms and conditions as the court deems proper,” Smith v. Phillips, 881
F.2d 902, 904-05 (10th Cir. 1989)(quoting Fed. R. Civ. P. 41(a)(2) (1988)). Such conditions
“could include retention of some jurisdiction by the court.” Smith v. Phillips, 881 F.2d at 905
(citing McCall-Bey v. Franzen, 777 F.2d 1178, 1188-90 (7th Cir. 1985)). The Tenth Circuit has
stated that, if the dismissal is pursuant to rule 40(a)(1)(A)(ii), undertaken without a court order,
then the court “is powerless to condition dismissal . . . upon a retention of jurisdiction.” Smith v.
Phillips, 881 F.2d at 905. This rule is likely no longer true; the district court can probably attach
a condition retaining jurisdiction, but only if the parties agree.
Even when . . . the dismissal is pursuant to Rule 41(a)(1)(ii) [(now rule
41(a)(1)(A)(ii))] (which does not by its terms empower a district court to attach
conditions to the parties’ stipulation of dismissal) we think the court is authorized
to embody the settlement contract in its dismissal order or, what has the same effect,
retain jurisdiction over the settlement contract) [sic] if the parties agree.
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 381-82 (1994).
The only factors counseling hesitation in endorsing the view that a court may retain
jurisdiction of a case dismissed pursuant to rule 41(a)(1)(A) are that: (i) the proclamation in
Kokkonen v. Guardian Life Insurance Co. of America was dicta, and “[i]t is to the holdings of [the
Supreme Court’s] cases, rather than their dicta, that we must attend,” 511 U.S. 375, 379; and
(ii) the Court refers to “embody[ing] the settlement contract in its dismissal order,” but rule
41(a)(1)(A) provides -- in its very title -- that it pertains to dismissals effectuated “Without a Court
Order,” Fed. R. Civ. P. 41(a)(1)(A) (emphasis in original). Smith v. Phillips must, however, be
interpreted in light of the Supreme Court’s subsequent decision in Kokkonen v. Guardian Life
Insurance Co. of America, 511 U.S. 375 (1994), in which the Supreme Court held that a district
court’s ancillary jurisdiction does not extend to the post-dismissal enforcement of federal case
settlement agreements, unless: (i) there is an independent basis of federal subject-matter
jurisdiction to hear the claims; (ii) the court incorporated the terms of the settlement agreement
into its order of dismissal; or (iii) the court includes a term “‘retaining jurisdiction’” in its order of
dismissal. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. at 381. That decision continues
to permit district courts to condition dismissals under rule 41(a)(2), see 511 U.S. at 381, and
appears to have no bearing on courts’ power to reopen cases pursuant to rule 60(b), see 511 U.S.
at 378 (noting, without opining on, the practice of “[s]ome Courts of Appeals” to
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to hear motions under rule 60(b). Smith v. Phillips, 881 F.2d 902, 904 (10th Cir. 1989)(“We agree
with the [United States Court of Appeals for the] Seventh Circuit that ‘[a]n unconditional dismissal
terminates federal jurisdiction except for the limited purpose of reopening and setting aside the
judgment of dismissal within the scope allowed by [Fed. R. Civ. P.] 60(b).” (alterations in
original)(quoting McCall-Bey v. Franzen, 777 F.2d 1178, 1190 (7th Cir. 1985))). See Thompson
v. THI of N.M. at Casa Arena, 2008 WL 5999653, at *28 (requiring, after dismissing a complaint,
that a plaintiff reopen the case before amending the complaint, because “[w]hen a complaint has
been dismissed, there is nothing to amend. . . . Allowing amendment of a dismissed complaint
would also evade the specific grounds, such as rule 60(b), that the Federal Rules of Civil Procedure
have established for court action on cases in which final judgment has been entered”).
Motions to obtain relief from a judgment or order based on “mistake, inadvertence,
surprise, or excusable neglect,” Fed. R. Civ. P. 60(b)(1), must be brought “within a reasonable
time . . . no more than a year after the entry of the judgment or order or the date of the proceeding,”
Fed. R. Civ. P. 60(c)(1). See Blanchard v. Cortes-Molina, 453 F.3d 40, 44 (1st Cir. 2006)(“[R]elief
from judgment for reasons of ‘mistake, inadvertence, surprise, or excusable neglect,’ must be
sought within one year of the judgment.” (quoting Fed. R. Civ. P. 60(b))). This deadline may not
be extended and is not subject to the court’s discretion. See Fed. R. Civ. P. 6(b)(2) (“A court must
not extend the time to act under Rules 50(b) and (d), 52(b), 59(b), (d), and (e), and 60(b).”). The
pendency of an appeal does not toll the time requirement for pursuing a motion under rule 60(b).
“reopen[ ] . . . dismissed suit[s] by reason of breach of the agreement that was the basis for
dismissal”).
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See Fed. R. Civ. P. 60(c)(1); Griffin v. Reid, 259 F. App’x 121, 123 (10th Cir.
2007)(unpublished);14 Tool Box, Inc. v. Ogden City Corp., 419 F.3d 1084, 1088 (10th Cir.
2005)(“[A]n appeal does not toll or extend the one-year time limit of Rule 60(b).”). No time limit
applies to rule 60(b)(6), other than that the motion be made within a reasonable time. See Fed. R.
Civ. P. 60(c)(1).
1.
Rule 60(b)(1).
The Tenth Circuit uses three factors in determining whether a judgment may be set aside
in accordance with rule 60(b)(1): (i) whether the moving party’s culpable conduct caused the
default; (ii) whether the moving party has a meritorious defense; and (iii) whether setting aside the
judgment will prejudice the nonmoving party. See United States v. Timers Preserve, 999 F.2d
452, 454 (10th Cir. 1993). Under some circumstances, for instance, a party can rely on rule
60(b)(1) for a mistake by their attorney or when their attorney acted without their authority. See
Yapp v. Excel Corp., 186 F.3d 1222, 1231 (10th Cir. 1999)(“Rule 60(b)(1) motions premised upon
14
Griffin v. Reid is an unpublished opinion, but the Court can rely on an unpublished
opinion to the extent its reasoned analysis is persuasive in the case before it. See 10th Cir. R.
32.1(A), 28 U.S.C. (“Unpublished decisions are not precedential, but may be cited for their
persuasive value.”). The Tenth Circuit has stated:
In this circuit, unpublished orders are not binding precedent, . . . and we have
generally determined that citation to unpublished opinions is not favored.
However, if an unpublished opinion or order and judgment has persuasive value
with respect to a material issue in a case and would assist the court in its disposition,
we allow a citation to that decision.
United States v. Austin, 426 F.3d 1266, 1274 (10th Cir. 2005). The Court concludes that Griffin
v. Reid, Pyeatt v. Does, 19 F. App’x 785 (10th Cir. 2001)(unpublished), and Chavez v. Primus
Auto. Fin. Servs., 125 F.3d 861, 1997 WL 634090 (10th Cir. 1997)(unpublished table decision),
have persuasive value with respect to material issues, and will assist the Court in its disposition of
this Memorandum Opinion and Order.
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mistake are intended to provide relief to a party . . . when the party has made an excusable litigation
mistake or an attorney has acted without authority . . . .”). Mistake in this context entails either
acting without the client’s consent or making a litigation mistake, such as failing to file or comply
with deadlines. See Yapp v. Excel Corp., 186 F.3d at 1231. If the alleged incident entails a
mistake, then it must be excusable, meaning that the party was not at fault. See Pioneer Inv. Servs.
v. Brunswick Assocs. Ltd. P’ship, 507 U.S. at 395 (“This leaves, of course, the Rule’s requirement
that the party’s neglect be ‘excusable.’”); Cashner v. Freedom Stores, Inc., 98 F.3d 572, 577 (10th
Cir. 1996)(“If the mistake alleged is a party’s litigation mistake, we have declined to grant relief
under Rule 60(b)(1) when the mistake was the result of a deliberate and counseled decision by the
party.”); Pelican Prod. Corp. v. Marino, 893 F.2d 1143, 1146 (10th Cir. 1990)(holding attorney
carelessness is not a basis for relief under Rule 60(b)(1)).
Courts will not grant relief when the mistake of which the movant complains is the result
of an attorney’s deliberate litigation tactics. See Cashner v. Freedom Stores, Inc., 98 F.3d at 577.
This rule exists because a party
voluntarily chose [the] attorney as his representative in the action, and he cannot
now avoid the consequences of the acts or omissions of this freely selected agent.
Any other notion would be wholly inconsistent with our system of representative
litigation, in which each party is deemed bound by the acts of his lawyer agent and
is considered to have notice of all facts, notice of which can be charged upon the
attorney.
Pioneer Inv. Servs. v. Brunswick Assocs. Ltd. P’ship, 507 U.S. at 397 (internal quotation marks
omitted)(quoting Link v. Wabash R.R., 370 U.S. 626, 633-34 (1962)). The Tenth Circuit has held
that there is nothing “novel” about “the harshness of penalizing [a client] for his attorney’s
conduct” and has noted that those “who act through agents are customarily bound,” even though,
when “an attorney is poorly prepared to cross-examine an expert witness, the client suffers the
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consequences.” Gripe v. City of Enid, 312 F.3d 1184, 1189 (10th Cir. 2002). The Court has
previously stated:
There is a tension between how the law treats attorney actions that are without
authority, thus permitting relief under rule 60(b), and how the law treats those
attorney actions which are inexcusable litigations decisions, thus failing to qualify
for relief; although the distinction between those actions may not always be logical,
it is well established.
Wilson v. Jara, No. CIV 10-0797 JB/WPL, 2012 WL 1684595, at *7 (D.N.M. May 10,
2012)(Browning, J.).15
The Supreme Court has recognized that individuals must be “held accountable for the
acts and omissions of their chosen counsel,” and that the “proper focus is upon whether the neglect
of respondents and their counsel was excusable.” Pioneer Inv. Servs. Co. v. Brunswick Assoc.
Ltd. P’ship, 507 U.S. at 397 (emphasis in original). At the same time, the Tenth Circuit has held
that, when counsel acts without authority, rule 60(b)(1) provides relief from judgment. See
Cashner v. Freedom Stores, Inc., 98 F.3d at 576 (“[A]s a general proposition, the ‘mistake’
provision in Rule 60(b)(1) provides for the reconsideration of judgment only where . . . an attorney
in the litigation has acted without authority from a party . . . .”)(quoting Fed. R. Civ P. 60(b)(1).
“There is a tension between these decisions, because, ordinarily, a client will not authorize his or
her attorney to act in a negligent manner or to make a mistake.” Wilson v. Jara, 2012 WL 1684595,
at *7 n.7. When the client acknowledges that he or she has hired the attorney, there is a difference
between decisions which terminate the litigation, such as settlement or a stipulation of dismissal,
and other litigation decisions, because decisions to terminate the litigation are ordinarily left to the
client. See Chavez v. Primus Auto. Fin. Servs., 125 F.3d 861, 1997 WL 634090, at *4-5 (10th Cir.
1997)(unpublished table decision)(citing Navajo Tribe of Indians v. Hanosh Chevrolet-Buick, Inc.,
1988-NMSC-010 ¶ 3, 749 P.2d 90, 92; Bolles v. Smith, 1979-NMSC-019 ¶ 11, 526, 591 P.2d 278,
280). “Otherwise the Court has difficulty explaining attorney decisions which are made without
authority and attorney decisions for which it is acceptable that the client suffer the consequences.”
Wilson v. Jara, 2012 WL 1684595, at *7 n.7.
In Chavez v. Primus Automotive Financial Services, the Tenth Circuit recognized that “the
mere employment of an attorney does not give him the actual, implied or apparent authority to
compromise his client’s case.” 1997 WL 634090, at *4. Few Tenth Circuit cases analyze whether
an attorney has acted without authority. The cases in which the Tenth Circuit has found a lack of
authority appear to fall into two categories: (i) cases in which the attorney entered an appearance
without the client’s knowledge, see FDIC v. Oaklawn Apartments, 959 F.2d 170, 175-76 (10th
Cir. 1992)(finding that there were factual issues which the district court needed to resolve where
“[t]here is nothing in the record indicating when Appellants became aware of the lawsuit and of
Newcombe’s purported representation”); and (ii) cases in which the attorney’s actions terminate
15
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2.
Rule 60(b)(6).
Rule 60(b)(6) provides that a court may relieve a party from final judgment, order, or
proceeding for “any other reason that justifies relief.” Fed. R. Civ. P. 60(b)(6). No time limit
the litigation, see Thomas v. Colo. Tr. Deed Funds, Inc., 366 F.2d 136, 139-40 (10th Cir.
1966)(finding that, as to one of the plaintiffs, “the record shows that he did not participate in the
transactions and negotiations with the S.E.C. and did not consent to the execution of the stipulation
of the judgment”); Cashner v. Freedom Stores, Inc., 98 F.3d at 577 (citing with approval Surety
Ins. Co. of Cal. v. Williams, 729 F.2d 581, 582-83 (8th Cir. 1984), which held that a “judgment
entered upon an agreement by the attorney may be set aside on affirmative proof that the attorney
had no right to consent to its entry”). Because decisions that terminate the litigation are ordinarily
the client’s prerogative, those decisions fit more squarely within rule 60(b)(1)’s “lack of consent”
prong.
Decisions where the purported client is unaware of the litigation, or of the attorney’s
attempt to act on his or her behalf, would also fit within rule 60(b)(1)’s “lack of consent” prong,
because an individual has the right to choose his or her own attorney, or to decide whether he or
she wishes to have any attorney. Other litigation decisions are made jointly or are within the
attorney’s control, see Model Code of Prof’l Conduct R. 1.2 cmt. 1 (2011)(“With respect to the
means by which the client’s objectives are to be pursued, the lawyer shall consult with the
client . . . and may take such action as is impliedly authorized to carry out the representation.”);
Pittman ex rel. Sykes v. Franklin, 282 F. App’x 418, 427 n.6 (6th Cir. 2008)(unpublished)(“[T]he
decision to allege comparative fault as an affirmative defense falls within a narrow band of
circumstances in which an attorney may act without consulting his or her client.”), and, thus, to
give final judgments meaning and allow cases to terminate, it is logical that those decisions must
fall within the “excusable litigation mistake” prong, or be based on a substantive mistake of law
or fact.
Although the Tenth Circuit does not appear to have expressed its views on where the line
is drawn between attorneys acting without consent and litigation mistakes, or acknowledged the
tension between these two categories, the Court concludes that the appropriate division is, when
the client is aware that the attorney is acting on his or her behalf, between decisions which dispose
of the case and ordinarily require client consent, and other routine attorney decisions which take
place over the course of the case. The Court also notes that rules of professional conduct require,
“[i]n a criminal case,” for a lawyer to “abide by the client’s decision, after consultation with the
lawyer, as to the plea to be entered, whether to waive a jury trial and whether the client will testify.”
Model Rules of Prof’l Conduct R. 1.2(a). While a decision on the plea to be entered in a criminal
case is comparable to whether to settle a civil case, the Court has not located any decisions
permitting rule 60(b) relief when a civil attorney waives his or her client’s right to jury trial. One
unpublished decision from the United States Court of Appeals for the Fourth Circuit discusses
briefly a scenario where, without resolving the issue’s merits, a criminal defendant raised through
a rule 60(b) motion in a habeas preceding that “his trial counsel had prevented him from testifying
in his defense.” United States v. McMahan, 8 F. App’x 272, 274 (4th Cir. 2001)(unpublished).
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applies to rule 60(b)(6), save that the motion be made within a reasonable time. See Fed. R. Civ.
P. 60(c)(1). “Thus, to the extent it is applicable, clause (6) appears to offer a means of escape from
the one-year limit that applies to motions under clauses (1), (2), and (3).” 11 Charles Alan Wright,
Arthur R. Miller & Mary Kane, Federal Practice & Procedure § 2864, at 490 (2d ed. 2012). In
Pioneer Investment Services Co. v. Brunswick Associates Ltd., the Supreme Court reasoned that,
to avoid abrogating the one-year time limit for rule 60(b)(1) to (3), rule 60(b)’s “provisions are
mutually exclusive, and thus a party who failed to take timely action due to ‘excusable neglect’
may not seek relief more than a year after the judgment by resorting to subsection (6).” 507 U.S.
at 393 (citing Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. 847, 863 & n.11 (1988)). “If
the reasons offered for relief from judgment could be considered under one of the more specific
clauses of Rule 60(b)(1)-(5), those reasons will not justify relief under Rule 60(b)(6).” 12 James
Wm. Moore et al., Moore’s Federal Practice, Civil § 60.48[2], at 60-182 (3d ed. 2013). Accord
Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. at 863 n.11 (“This logic, of course, extends
beyond clause (1) and suggests that clause (6) and clauses (1) through (5) are mutually
exclusive.”).
Rule 60(b)(6) is a “grand reservoir of equitable power to do justice in a particular case.”
Van Skiver v. United States, 952 F.2d 1241, 1244 (10th Cir. 1991)(internal quotation marks
omitted)(quoting Pierce v. Cook & Co., 518 F.2d 720, 722 (10th Cir. 1975). “The Rule does not
particularize the factors that justify relief, but we have previously noted that it provides courts with
authority ‘adequate to enable them to vacate judgments whenever such action is appropriate to
accomplish justice,’ while also cautioning that it should only be applied in ‘extraordinary
circumstances.’” Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. at 863 (quoting Klapprott
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v. United States, 335 U.S. 601, 614-15 (1949)). Generally, the situation must be one beyond the
control of the party requesting relief under rule 60(b)(6) to warrant relief. See Ackermann v.
United States, 340 U.S. 193, 202 (1950)(“The comparison [of prior precedent] strikingly points up
the difference between no choice and choice; imprisonment and freedom of action; no trial and
trial; no counsel and counsel; no chance for negligence and inexcusable negligence.”). Legal error
that provides a basis for relief under rule 60(b)(6) must be extraordinary, as the Tenth Circuit
discussed in Van Skiver v. United States:
The kind of legal error that provides the extraordinary circumstances justifying
relief under Rule 60(b)(6) is illustrated by Pierce [v. Cook & Co., 518 F.2d 720,
722 (10th Cir. 1975)(en banc)]. In that case, this court granted relief under 60(b)(6)
when there had been a post-judgment change in the law “arising out of the same
accident as that in which the plaintiffs . . . were injured.” Pierce, 518 F.2d at 723.
However, when the post-judgment change in the law did not arise in a related case,
we have held that “[a] change in the law or in the judicial view of an established
rule of law” does not justify relief under Rule 60(b)(6). Collins v. City of Wichita,
254 F.2d 837, 839 (10th Cir. 1958).
Van Skiver v. United States, 952 F.2d at 1244-45.
“Courts have found few narrowly-defined situations that clearly present ‘other reasons
justifying relief.’” Wright et al., supra, § 2864, at 483 (quoting Fed. R. Civ. P. 60(b)(6)). See
Marcotte, In re Ortega v. Burlington N. Santa Fe Rail Corp., No. CIV 04-0836 JB/RLP, 2007 WL
5685130, at *29 (D.N.M. Oct. 11, 2007)(Browning, J.)(“Rule 60(b)(6), given its more liberal time
restraints, is reserved for the most egregious cases.). The Supreme Court expounded:
To justify relief under subsection (6), a party must show “extraordinary
circumstances” suggesting that the party is faultless in the delay. If a party is partly
to blame for the delay, relief must be sought within one year under subsection (1)
and the party’s neglect must be excusable. In Klapprott [v. United States, 335 U.S.
601 (1949)], for example, the petitioner had been effectively prevented from taking
a timely appeal of a judgment by incarceration, ill health, and other factors beyond
his reasonable control. Four years after a default judgment had been entered against
him, he sought to reopen the matter under Rule 60(b) and was permitted to do so.
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Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd., 507 U.S. at 393 (citing Liljeberg v. Health
Servs. Acquisition Corp., 486 U.S. at 863 & n.11; Ackerman v. United States, 340 U.S. 193, 197200 (1950); Klapprott v. United States, 335 U.S. at 613-14). See Gonzalez v. Crosby, 545 U.S.
524, 535 (2005)(“[O]ur cases have required a movant seeking relief under Rule 60(b)(6) to show
‘extraordinary circumstances’ justifying the reopening of a final judgment.”(quoting Ackerman v.
United States, 340 U.S. at 199)). In Gonzalez v. Crosby, the Supreme Court found a change in the
law during the pendency of a habeas petition was not an extraordinary circumstance. See 545 U.S.
at 537.
When the Supreme Court first addressed rule 60(b)(6) a year after it was introduced to the
federal rules, while the Justices were sharply divided on other issues, no dispute arose from the
statement of the Honorable Hugo Black, former Associate Justice of the Supreme Court: “[O]f
course, the one year limitation would control if no more than ‘neglect’ was disclosed by the
petition. In that event the petitioner could not avail himself of the broad ‘any other reason’ clause
of 60(b).” Klapprott v. United States, 335 U.S. at 613 (quoting Fed. R. Civ. P. 60(b)). See Wright
et al., supra, § 2864, at 493.
Examples where courts apply rule 60(b)(6) include “settlement agreements when one party
fails to comply” and courts use the rule “to return the parties to the status quo,” or in cases where
fraud is used by a “party’s own counsel, by a codefendant, or by a third-party witness,” which does
not fit within rule 60(b)(3)’s provision for fraud by an adverse party. Wright et al., supra, § 2864,
at 485, 487. The most common application is to grant relief “when the losing party fails to receive
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notice of the entry of judgment in time to file an appeal.”16 Wright et al., supra, § 2864, at 488.
When moving for relief pursuant to rule 60(b)(6), it is not enough to argue the same issues that a
court has already addressed.
See Pyeatt v. Does, 19 F. App’x 785, 788 (10th Cir.
2001)(unpublished)(concluding that a motion to reconsider that “simply reasserts information
considered by the district court in its initial determination . . . does not meet the extraordinary
circumstances standard required for Rule 60(b)(6) relief”).
ANALYSIS
The Court denies the Basnet Intervenors’ Motion. The Court concludes, first, that the
Basnet Intervenors must satisfy rule 60(b) before they can prosecute their Third Amended
Complaint. Having reached this conclusion, the Court considers whether the Basnet Intervenors
meet the requirements for either rule 60(b)(5) or 60(b)(6) as the Basnet Intervenors contend that
they do. The Basnet Intervenors’ arguments for applying either rule do not convince the Court.
Accordingly, the Court will not permit the Basnet Intervenors to proceed with the Third Amended
Complaint.
16
According to commentators,
[m]ost of those cases, however, predate the 1991 amendment to Appellate Rule
4(a)(6), which now provides relief from the strict appellate filing rule if the party
did not learn of the entry of the judgment. In light of that change, most courts have
held that resort to Rule 60(b) as a means of extending the appeal time no longer is
appropriate, although the Rule 60(b) approach is still utilized in some courts,
primarily in the [United States Court of Appeals for the] Sixth Circuit.
Wright et al., supra, § 2864, at 489-90 (citations omitted). See Clark v. Lavallie, 204 F.3d 1038,
1041 (10th Cir. 2000)(“Rules 4(a)(6) and 77(d) ‘preclude[] the use of Fed. R. Civ. P. 60(b)(6) to
cure problems of lack of notice.’” (citations omitted)).
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I.
TO PROCEED WITH THE THIRD AMENDED COMPLAINT, THE BASNET
INTERVENORS MUST SHOW THAT THEY ARE ENTITLED TO RELIEF
FROM THE FINAL JUDGMENT.
Now that they have intervened, the Basnet Intervenors seek to litigate anew the putative
class action, beginning with the Third Amended Complaint. The Court agrees with the Defendants
that the Basnet Intervenors cannot simply begin this action again. The Basnet Intervenors must
obtain relief from the judgment before proceeding with this case.
Preliminarily, in the Intervention MOO, the Court did not decide whether the Basnet
Intervenors would need to satisfy rule 60 for the Third Amended Complaint to move forward. The
Court permitted the Basnet Intervenors to intervene, because it believed that United Airlines v.
McDonald counseled it to do so, but the Court did not go further and determine that the Basnet
Intervenors might need to satisfy rule 60. See Intervention MOO at 49-50, 322 F.R.D. at 678-82.
That, in the Intervention MOO, the Court discusses subject-matter jurisdiction and mootness does
not mean that the Court determined that the Basnet Intervenors can prosecute the Intervention
MOO. See Motion at 6. For the Basnet Intervenors to intervene, the Court needed jurisdiction
over them, and the Basnet Intervenors could expect the Court to address whether it had such
jurisdiction.
The Court will not do as the Basnet Intervenors request and reopen this case while the Final
Judgment remains undisturbed. After a party accepts an offer of judgment, a clerk “must . . . enter
judgment.” Fed. R. Civ. P. 68. Such “[a] final judgment terminates the Court’s jurisdiction over
the main case,” Pedroza v. Lomas Auto Mall, Inc., 304 F.R.D. at 333-34; once a case is
“unconditionally dismiss[ed],” the Court loses all jurisdiction over the case other than the ability
to hear motions under rule 60(b). Smith v. Phillips, 881 F.2d at 904. The Federal Rules of Civil
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Procedure clearly delineate the circumstances in which the Court may set aside a Final Judgment,
see Fed. R. Civ. P. 59-60, and “[t]he proper procedural device for relief from a Rule 68 judgment
is the same as for any other judgment: Rule 60,” Rule 68 -- Offer of Judgment, Steven S. Gensler,
2 Federal Rules of Civil Procedure, Rules and Commentary (Feb. 2019)(quoting Webb v. James,
147 F.3d 617, 622 (7th Cir. 1998)). The Bastian Plaintiffs and the Defendants entered a Final
Judgment in which they agreed that “[t]he amount of this judgment is in full settlement of all of
Plaintiffs’ claims against Defendants, including claims for attorneys’ fees,” Final Judgment at 2;
the Final Judgment reserves no claims or issues on which the case should continue, see Final
Judgment at 1-2. To reconsider the Final Judgment and reopen the case here the Basnet Intervenors
must proceed under rule 60. Cf. United States v. Ky. Utils. Co., 927 F.2d at 255 (requiring an
intervenor to file a rule 60(b)(6) motion when the court had already entered a final judgment)
Contrary to the Basnet Intervenors’ contentions, although the Court has recognized that the
Basnet Intervenors maintain an interest in this action,17 Intervention MOO at 53, 322 F.R.D. at
679, this interest does not provide a green light to restart the litigation. The Tenth Circuit drew
the conclusion that putative class members have a “nascent interest” in putative class actions, see
17
In the Intervention MOO, the Court states:
Lucero holds that, when a class certification is pending, “any Article III interest a
class may or may not have in a case is or is not present from its inception” and that
“the personal stake of the class inheres prior to certification.” 639 F.3d at 1249.
The Proposed Intervenors’ assertions, taken at face value, demonstrate that they
have wage claims for which the proposed classes were designed. Although the
Proposed Intervenors are new to this putative class action, their interest in it is not,
having effectively “attached” at this litigation’s beginning.
Intervention MOO at 53.
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Lucero v. Bureau of Collection Recovery Inc., 639 F.3d at 1249, upon which the Basnet
Intervenors rely, from a line of cases that recognize class members continuing interests after the
mooting of a class members’ claims, see Lucero v. Bureau of Collection Recovery Inc., 639 F.3d
at 1245-49 (discussing Deposit Guaranty Nat’l Bank v. Roper, 445 U.S. 326 (1980); U.S. Parole
Comm’n v. Geraghty, 445 U.S. 388 (1980); Gerstein v. Pugh, 420 U.S. 103 (1975); Sosna v. Iowa,
419 U.S. 393 (1975), Clark v. State Farm Mutual Auto Ins., 590 F.3d 1134 (10th Cir. 2009); Weiss
v. Regal Collections, 385 F.3d 337 (3rd Cir. 2004); Reed v. Heckler, 756 F.2d 779 (10th Cir.
1985); Zeidman v. J. Ray McDermott & Co., 651 F.2d 1031 (5th Cir. 1981)). In Lusardi v. Xerox
Corp., the Third Circuit comments that a settlement agreement did not render moot a putative class
action when it discusses two exceptions to traditional mootness doctrines:
[A] named plaintiff whose individual claim has expired may continue in his
representative capacity to litigate class certification issues only for two limited
purposes: (1) to argue a certification motion that was filed before his claims expired
and which the district court did not have a reasonable opportunity to decide; and
(2) to appeal a denial of a class certification motion presented when his claims were
live.
Lusardi v. Xerox Corp., 975 F.2d at 975. These cases and statements turn on class and putative
class members’ continuing interests for the purposes of Article III’s case or controversy
jurisdiction. See, e.g., U.S. Parole Comm’n v. Geraghty, 445 U.S. at 395-96; Sosna v. Iowa, 419
U.S. at 398; Lucero v. Bureau of Collection Recovery Inc., 639 F.3d at 1242; Clark v. State Farm
Mutual Auto Ins., 590 F.3d at 1138. The Supreme Court has recognized a certain flexibility in
such mootness doctrines in the context of class actions. See Clark v. State Farm Mut. Auto. Ins.,
590 F.3d at 1138 (“In light of the relative independence of the class entity from any one party, the
Court has recognized the more ‘flexible character of the Art. III mootness doctrine’ in the class
action context.” (quoting U.S. Parole Comm’n v. Geraghty, 445 U.S. at 400)). What the Basnet
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Intervenors ask, however, is for the Court to apply the same style of flexibility to a different
doctrine -- that doctrine supporting the finality of a final judgment.
The Court has found no caselaw that encourages it to reach a different decision here. In
United Airlines, Inc. v. McDonald, on which the Court relied in its Intervention MOO, the Supreme
Court permitted a putative class member to intervene to appeal the denial of a class certification.
See United Airlines, Inc. v. McDonald, 432 U.S. at 935-96. The case is inapposite here. An appeal
continues the lawsuit from its procedural posture after the judgment; it does not restart a lawsuit
from the complaint. Although the Basnet Intervenors argue that courts routinely substitute new
named plaintiffs when an earlier named plaintiff’s claim becomes moot, in the cases that the Basnet
Intervenors cite and all the cases that the Court found, the courts had not entered a final judgment
when it made such a substitution. See, e.g., In re Telectronics Pacing Sys., Inc., Accufix Atrial
“J” Leads Prods. Liab. Litig., 172 F.R.D. at 283 (citing the idea that a court should permit
substitution of class representatives to permit a class member without an individual claim to fill a
position as class representative); Shankroff v. Advest, Inc., 112 F.R.D. at 194 (certifying a class
subject to the requirement that the plaintiffs put forth a class representative within thirty days). In
Lusardi v. Xerox Corp., although the Third Circuit enumerated exceptions to the mootness
requirement, it did not address whether a class action overcomes the finality rules. 975 F.2d at
975. The Court suspects that this lack of authority reflects an assumption that a final judgment,
without reservations, is final. Cf. Hooks v. Landmark Indus., Inc., 797 F.3d 309, 315 (5th Cir.
2015)(“We agree that ‘[a] plaintiff seeking to represent a class should be permitted to accept an
offer of judgment on her individual claims under Rule 68, receive her requested individual relief,
and have the case dismissed, or reject the offer and proceed with the class action.’” (quoting
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Yaakov v. ACT, Inc., 987 F. Supp. 2d 124, 128 (D. Mass. 2014)(Hillman, J.)); Bais Yaakov of
Spring Valley v. Graduation Source, LLC, 167 F. Supp. 3d 582, 584 (S.D.N.Y.
2016)(Román, J.)(describing that a live claim remains when “this Court has not entered judgment
in favor of Plaintiff and has not, by ‘express, written order’ released the funds to Plaintiff”). But
cf. William B. Rubenstein, 1 Newberg on Class Actions § 2:15 (5th ed. 2018)(“However, if the
courts do fashion a mootness exception in accordance with the terms outlined at the end of
Campbell-Ewald[, 136 S. Ct. 663 (2016)], or if the representative’s claim is mooted because she
accepts the offer of judgment, a question then arises concerning the viability of the class suit.”).
The Basnet Intervenors’ concerns about offers of judgment permitting class-action
defendants to pick off named plaintiffs are not unique. Other courts have noted that rule 68 creates
concerns in the context of class actions. See, e.g., Smith v. NCO Fin. Sys., Inc., 257 F.R.D. 429,
434-35 (E.D. Pa. 2009)(Rufe, J.)(“Rule 68 was not meant to test the strength of a plaintiff’s motion
for class certification. . . . [I]f Plaintiff were to consider Defendants’ amended offer of judgment,
the determinative factor will be whether she believes the Court will certify a class action,
not . . . the merits of her claims.”). While permitting putative class members to appeal the denial
of a class certification, the Supreme Court noted:
Requiring multiple plaintiffs to bring separate actions, which effectively could be
“picked off” by a defendant’s tender of judgment before an affirmative ruling on
class certification could be obtained, obviously would frustrate the objectives of
class actions; moreover it would invite waste of judicial resources by stimulating
successive suits brought by others claiming aggrievement.
Deposit Guar. Nat. Bank, Jackson, Miss. v. Roper, 445 U.S. at 339. The Honorable Gerald E.
Rosen, United States District Court for the Eastern District of Michigan, has observed:
As a number of courts have recognized, service of a Rule 68 offer of judgment on
the named plaintiff in a putative class action poses a dilemma to this party, as it
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forces him to choose between (i) accepting an offer that, like Defendants’ offer
here, reflects “payment in full of his own individual claim for relief,” and thereby
“abandon[ing]” the interests of the putative class, or (ii) rejecting the offer and
“continuing to represent the interests of the [putative] class,” while running the risk
of “incur[ring] the cost-shifting liability imposed by Rule 68.” Johnson v. U.S.
Bank National Ass’n, 276 F.R.D. 330, 334-35 (D. Minn. 2011); see also Smith v.
NCO Financial Systems, Inc., 257 F.R.D. 429, 433-34 (E.D. Pa. 2009); Stewart v.
Cheek & Zeehandelar, LLP, 252 F.R.D. 384, 386 (S.D. Ohio 2008).
Combe v. Goodman Frost, PLLC, 217 F. Supp. 3d 986, 987-89 (E.D. Mich. 2016)(Rosen, J.).
See Charles A. Wright, Arthur R. Miller, Mary Kay Kane, Richard L. Marcus, A. Benjamin
Spencer, Adam N. Steinman, 12 Federal Practice and Procedure Civil § 3001.1 (3d ed.
2018)(“[T]he potential coercive impact of the rule on the class representative could create a
conflict of interest for [the named plaintiff] since possible personal responsibility for defendant’s
costs for a full class action may be far out of proportion to the class representative’s stake in a
possible individual recovery.” (footnotes omitted)). Other commentators have noted that rule 68
offers cut-off putative classes earlier and force earlier certification motions. Cf. O. Randolph
Bragg, Ohio Consumer Law § 5:31 (2018)(expressing concerns that rule 68 offers will force
premature class certification motions). But see Combe v. Goodman Frost, PLLC, 217 F. Supp. 3d
at 988 (“[W]hile a Rule 68 offer of judgment to the named plaintiff in a putative class action might
present this party with a ‘difficult choice’ . . . , ‘this merely reflects the strategic nature of our
adversary system and in no way indicates a defect in the Federal Rules of Civil Procedure.’”
(quoting Mey v. Monitronics International, Inc., No. 5:11-CV-90, 2012 WL 983766, at *5 (N.D.W.
Va. March 22, 2012)(Rosen, J.))).
The Court disagrees with these other courts’ concerns. This case shows that there is little
harm to this “picking off.” Some plaintiffs have been fully compensated. The plaintiffs’ attorney
has been fully paid. And there is still a pending class action certification. From a justice standpoint
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-- which is what law and especially class actions are all about -- the plaintiffs and their counsel can
hardly argue. Moreover, “[t]he notion that a defendant may short-circuit a class action by paying
off the class representatives either with their acquiescence or, as here, against their will, deserves
short shrift. Indeed, were it so easy to end class actions, few would survive.” Roper v. Consurve,
Inc., 578 F.2d 1106, 1110-11 (5th Cir. 1978). Where a corporate defendant pays some plaintiffs
so readily, it can expect more plaintiffs. It has to think once, twice, and three times before
employing such a strategy.
In any case, despite the Court’s views, that the Defendants cut short the development of
the putative class here is the reality of the rules as they now stand. These policy concerns do not
persuade the Court to overlook the Final Judgment’s effects. The Federal Rules of Civil Procedure
permit offers of judgment pursuant to rule 68 in putative class actions and then limit the
circumstances in which a court may reconsider judgments. “[E]ven if a Rule 68 offer of judgment
were viewed as potentially undermining the class action mechanism set forth in Rule 23,
‘[r]ecognizing the existence of a problem does not, without more, give [the court] the authority to
craft a solution.’” Combe v. Goodman Frost, PLLC, 217 F. Supp. 3d at 988 (quoting White v.
Ally Fin. Inc., Civil Action No. 2:12-cv-00384, 2012 WL 2994302, at *4 (S.D.W. Va. July 20,
2012)(Goodwin, J.)).
The Court cannot ignore that the Bastian Plaintiffs and the Basnet Intervenors could have
avoided this situation. The Bastian Plaintiffs did not have to accept the Offer of Judgment. A
putative class action can proceed after a rejected offer of judgment, and the frequency with which
such cases appear in the Court’s research and the Supreme Court’s decision to resolve such cases
suggest that such rejections occur with relative frequency. See Campbell-Ewald Co. v. Gomez,
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136 S. Ct. at 669-70. The Bastian Plaintiffs made a strategic choice; they acted for themselves
rather than for the class. Moreover, the Basnet Intervenors share the same counsel as the Bastian
Plaintiffs, and this counsel could have refused a final judgment. In any case, counsel knew that
the Bastian Plaintiffs would enter the Final Judgment. Although, as the Basnet Intervenors
contend, finding new class representatives and filing an intervention motion requires time, the
Basnet Intervenors could have anticipated the offer of judgment as a strategy of the litigation.
II.
THE BASNET INTERVENORS CANNOT OBTAIN RELIEF UNDER RULE 60(b).
As the Court has concluded that the Basnet Intervenors must satisfy rule 60(b) before they
proceed in this litigation, the Court moves to the Basnet Intervenors’ alternative contentions that
they deserve relief from the Final Judgment under rules 60(b)(5) and 60(b)(6). Fundamentally,
rule 60(b) cannot fulfill the Basnet Intervenors’ goal. The Basnet Intervenors admit that they do
not seek what rule 60(b) provides -- relief from a final judgment; they desire relief from the Final
Judgment’s finality. See Motion at 11; Sep. 26 Tr. at 20:17-24 (Stanford). On its terms, rule 60(b)
permits a court to “relieve a party . . . from a final judgment, order, or proceeding,” but not from
the final judgment’s finality. Fed. R. Civ. P. 60.18 The Basnet Intervenors might be able to gain
relief if they could satisfy a rule 60 provision, but they cannot squeeze their attempt to overturn
the Final Judgment’s effect into either of the subsections that they cite. See Motion at 11.
Accordingly, the Court will not set aside the Final Judgment to allow the Basnet Intervenors to
progress this litigation.
A.
THE BASNET INTERVENORS CANNOT OBTAIN RELIEF UNDER
RULE 60(b)(5).
18
In the Intervention MOO, the Court permits the Basnet Intervenors to intervene so that
they may gain standing as parties to raise a rule 60 motion.
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The Court cannot and will not say, as the Basnet Intervenors’ propose, that, because the
Defendants paid the Bastian Plaintiffs the relief required in the Final Judgment, the Basnet
Intervenors deserve relief from the Final Judgment. As the Basnet Intervenors contend, rule
60(b)(5) literally states that a “court may relieve a party . . . from a final judgment” when “the
judgment has been satisfied, released, or discharged.” Fed. R. Civ. P. 60. Contrary to the Basnet
Intervenors’ arguments, however, this subsection contemplates the situation in which changed
circumstances make full satisfaction of an existing judgment inequitable; the rule 60(b)(5)
“standard is based on the historic power of a court of equity to modify its decree in light of changed
circumstances.” Alpine Bank v. Hubbell, No. 05-CV-00026-CMA-KLM, 2010 WL 1258002, at
*8 (D. Colo. March 24, 2010)(Arguello, J.)(quoting Zimmerman v. Quinn, 744 F.2d 81, 82 (10th
Cir. 1984)). Courts grant rule 60(b)(5) motions to relieve an owing party of its obligations under
the judgment when the party has contributed to or fully satisfied the judgment. See, e.g., Charles
Alan Wright, Arthur R. Miller, Mary Kay Kane, Richard L. Marcus, A. Benjamin Spencer, and
Adam N. Steinman Federal Practice and Procedure Civil § 2863 (3d ed. 2018)(citing Frew v.
Janek, 780 F.3d 320 (5th Cir. 2015)(“dissolving provisions of the consent decree” when the state
complied with the requirements); BUC Intern. Corp. v. Int’lYacht Council Ltd., 517 F.3d 1271
(11th Cir. 2008)(noting that rule 60(b)(5) could provide credit for settlement amounts that
tortfeasors had paid to the injured party); Snowden v. D.C. Transit Sys., Inc., 454 F.2d 1047 (D.C.
Cir. 1971)(finding that a court should have considered under 60(b)(5) a codefendants’ motion to
reduce a judgment by the amount paid in settlement); Candiano v. Moore-McCormack Lines, Inc.,
407 F.2d 385 (2d Cir. 1969)(resolving under rule 60(b)(5) an argument to mark a judgment
satisfied before the defendant paid post-judgment interest); Sierra Club v. Mason, 365 F. Supp. 47
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(D. Conn. 1973)(Newman, J.)(concluding that an “[i]njunction restraining defendants from
dredging harbor until an environmental impact statement had been dissolved after the impact
statement is filed”); Caraway v. Sain, 23 F.R.D. 657 (N.D. Fla. 1959)(Carswell, J.)(approaching
under rule 60(b)(5) a reduction in a judgment by the amount paid in settlement)).
The Basnet Intervenors’ situation does not fit the circumstances in which courts have
applied rule 60(b)(5). No changed circumstances justify altering an owing party’s obligations.
The Basnet Intervenors do not even ask that the Court consider the obligations under the Final
Judgment that are paid or owing. The Basnet Intervenors want simply that the Court ignore the
Final Judgment, but rule 60(b)(5) does not offer such relief.
The Court also agrees with the Defendants that the Basnet Intervenors’ proposal to apply
rule 60(b)(5) here would lead to nonsensical results. See Response at 7. The Court will not read
the rule to mean that a party deserves relief every time a party against whom a court has imposed
a judgment satisfies in part or in whole that judgment. See Response at 7. Such a rule would
create perverse incentives by precluding a party from reopening an action only when the owing
party did not fulfill its obligation. See Response at 7. The Basnet Intervenors seek to overcome
this shortcoming by listing a series of alternate means to force defendants to pay judgments,
including such devices as writs of garnishment and post-judgment discovery. See Reply at 6.
Although such practical tools may help coerce parties to pay judgments, they do not substitute for
the basic assumption that an owing party should pay a judgment. The Basnet Intervenors’
contention reverses this assumption.
To such objections, the Basnet Intervenors respond that their “principal point is that
because the judgment has been satisfied, there will be no disturbance whatsoever in that portion of
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the lawsuit that was resolved between the five Bastian plaintiffs and the two Defendants.” Reply
at 6. The Court cannot imagine how this interpretation reflects rule 60(b)(5)’s basis in equity. See
Alpine Bank v. Hubbell, 2010 WL 1258002, at *8. The Basnet Intervenors’ facts are not the
changed circumstances for which equity would dictate relief from a judgment. No owing party
has partially fulfilled its obligations or should not be forced to continue its obligations. Under the
Basnet Intervenors’ view, any additional party with a potential interest in a case could reopen a
lawsuit the judgment for which a defendant had satisfied. Rule 60(b)(5) does not provide for this
“relief.”
B.
THE BASNET INTERVENORS ALSO CANNOT SATISFY RULE 60(b)(6).
The Court also will not apply rule 60(b)(6) to provide the Basnet Intervenors relief. “‘Rule
60(b)(6) relief is even more difficult to attain’ than relief under the other sections of rule 60(b).”
Thompson v. THI of N.M. at Casa Arena, 2008 WL 5999653, at *21 (quoting Yapp v. Excel Corp.,
186 F.3d at 1232). “To justify relief under subsection (6), a party must show ‘extraordinary
circumstances’ suggesting that the party is faultless in the delay. If a party is partly to blame for
the delay, relief must be sought within one year under subsection (1) and the party’s neglect must
be excusable.” Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd., 507 U.S. at 393. “Generally
speaking, the grant of relief under Rule 60(b) lies within the Court’s discretion, but is
‘extraordinary and may only be granted in exceptional circumstances.’” SOLIDFX, LLC v.
Jeppesen Sanderson, Inc., No. 11-CV-1468-WJM-BNB, 2018 WL 803663, at *3 (D. Colo. Feb. 9,
2018)(Martinez, J.)(quoting Servants of Paraclete v. Does, 204 F.3d at 1009). Generally, the
situation must be one beyond the control of the party requesting relief under rule 60(b)(6) to
warrant relief. See Ackermann v. United States, 340 U.S. at 202; Thompson v. THI of N.M. at
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Casa Arena, 2008 WL 5999653, at *21 (denying a rule 60(b)(6) motion partially because a party
was “trying to extricate himself” from a situation that was “largely his own fault”). Further,
“[w]hile the rule 60(b)(6) analysis that courts have employed focuses on fault, what the movant
stands to lose if his motion is denied is certainly part of the equation.” Thompson v. THI of N.M.
at Casa Arena, 2008 WL 5999653, at *23 (citing Thompson v. Kerr-McGee Refining Corp., 660
F.2d 1380, 1385 (10th Cir. 1981))). That a party has other avenues through which to pursue its
claims or that its claims may be futile has weighed against granting relief. See Thompson v. THI
of N.M. at Casa Arena, 2008 WL 5999653, at *23-27.
The Basnet Intervenors have not convinced the Court that it should grant them rule 60(b)(6)
relief. Preliminarily, the Basnet Intervenors submitted the Motion after the Court and the parties
began debating seriously whether the Basnet Intervenors had to satisfy rule 60(b), and in response
to the Court’s explicit request that they submit an argument on whether or how they satisfy rule
60(b), see Motion at 13, so the Court does not consider the Basnet Intervenors’ request untimely.
The Basnet Intervenors partially caused, however, their situation by not intervening before the
Court entered the Final Judgment. Although finding new class representatives and filing an
intervention requires time, the Basnet Intervenors’ counsel, who also represented the Bastian
Plaintiffs, might have anticipated that the Defendants would make a strategic offer of judgment
and, once the Defendants made the offer, would have known that the Final Judgment was pending.
The Basnet Intervenors only argument that they face extraordinary circumstances is that, if they
cannot proceed in this litigation, some of their claims might lose American Pipe tolling and be
subject to dismissal. See Reply at 7; Sep. 26 Tr. at 7:2-23 (Stanford). The Basnet Intervenors are,
however, all parties to Bell, with which this case is consolidated, and the Basnet Intervenors cannot
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identify how many individuals’ claims and/or potential damages this tolling will affect. See Sep.
26 Tr. at 8:7-9:4 (Stanford). The Basnet Intervenors unjust enrichment claim faces a four-year
statute of limitations, see N.M. Stat. Ann. § 37-1-3, and the NMMWA claim has a three-year
statute of limitations, see N.M. Stat. Ann. § 37-1-5. It is likely none of the Basnet Intervenors are
losing entire claims; at most, failure to be able to pursue the Third Amended Complaint means that
the Basnet Intervenors will lose some damages because of the statute of limitations. Again, that
the Basnet Intervenors tarried as the statute of limitations ran is not a convincing reason to disturb
the Final Judgment for which the Bastian Plaintiffs and the Defendants bargained. Any individuals
who will lose their claims or, more likely, some of their damages, admittedly face a difficult
situation; they and their counsel may have relied, or at least hoped to rely, on American Pipe tolling
in deciding not to intervene in this case earlier or to file their own suits. The existing rules,
however, allow the Defendants to use rule 68 offers of judgment to pick off named plaintiffs. That
a statute of limitations, a common procedural rule, now applies to the Basnet Intervenors’ claims,
because the Basnet Intervenors did not foresee the Defendants’ tactics, is not sufficient to warrant
the extraordinary rule 60(b)(6) relief. See, e.g., McCurry ex rel. Turner v. Adventist Health
Sys./Sunbelt, Inc., 298 F.3d 586, 596 (6th Cir. 2002)(finding that “strategic miscalculation” does
not rise to the “rigorous standard” for relief under rule 60(b)(6)); Aikens v. Ingram, No. 5:06-CV185-D, 2008 WL 4831420, at *5 (E.D.N.C. Nov. 5, 2008)(Dever III, J.)(noting that “‘extraordinary
circumstances’ do not arise due to time limitations that otherwise apply, and a plaintiff cannot use
Rule 60(b)(6) to evade such time limitations”), aff’d, Aikens v. Ingram, 652 F.3d 496, 503 (4th
Cir. 2011).
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The Basnet Intervenors do not want the Court to relieve them of the Final Judgment
anyway. They hope that the Court will take pity on their failure to satisfy the statute of limitations
for some potential damages, reopen a closed suit, and let them use this vehicle despite the Final
Judgment to which their counsel agreed. The Court does not believe that it can, consistent with
the Federal Rules of Civil Procedure and the caselaw interpreting it, allow the Basnet Intervenors
to use this old case. Accordingly, the Court will not set aside the Final Judgment and the Basnet
Intervenors will not be permitted to proceed with their Third Amended Complaint.
IT IS ORDERED that Plaintiffs’ Motion to Address Issue of Fed. R. Civ. P. 60 for
Intervenors to Proceed with Third Amended Complaint or, Alternatively Fed. R. Civ. P. 60(B)
Motion to Obtain Relief from Final Judgment, filed August 3, 2018 (Doc. 200), is denied.
_______________________________
UNITED STATES DISTRICT JUDGE
Counsel:
Christopher M. Moody
Alice Kilborn
Repps D. Stanford
Moody & Stanford, P.C.
Albuquerque, New Mexico
Attorneys for the Plaintiffs and Intervenors
Charles J. Vigil
Melanie B. Stambaugh
Jeffrey L. Lowry
Rodey, Dickason, Sloan, Akin & Robb, P.A.
Albuquerque, New Mexico
Attorneys for the Defendants
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