Anwar et al v. Fairfield Greenwich Limited et al

Filing 1554

DECISION AND ORDER: For the reasons stated above, it is hereby ORDERED that the request of the Representative Plaintiffs on their own behalf and on behalf of the Settlement Class (collectively, "Anwar Plaintiffs") to reject eight requests for exclusion from the Citco Final Judgment and Order of Dismissal (Dkt. No. 1457) that were received by the Claims Administrator after the deadline for requesting exclusion (Dkt. No. 1552) is GRANTED. (Signed by Judge Victor Marrero on 3/11/2016) (lmb)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

-----------------------------------x
PASHA ANWAR, et al.,
Plaintiffs,
DECISION AND ORDER

- against FAIRFIELD GREENWICH LIMITED,
et al.,
Defendants.

-----------------------------------x
VICTOR MARRERO, United States District Judge.

On

August

13,

2015,

this

Court

issued

an

order

preliminarily approving a partial settlement of this action
("August

13

(Dkt.

Order")

No.

1402),

resolving

claims

asserted by the Representative Plaintiffs on their own behalf
and on behalf of the Settlement Class (collectively,

"Anwar

Plaintiffs") against Citco Fund Services (Europe) B.V., Citco
(Canada) Inc., Citco Bank Nederland N.V. Dublin Branch, Citco
Global Custody N.V., Citco Fund Services (Bermuda Limited),
The Citco Group Limited,
(collectively,
Stipulation

"Citco
of

Brian Francoeur,

Defendants"),

Settlement

as

("Citco

and Ian Pilgrim
embodied

in

the

Stipulation

of

Settlement") . (Dkt. No. 1398.)
In the August
Hearing

for

13

November

Order,
20,

2015

the
to

Court

set

determine

a

Settlement

"whether

the

proposed partial Settlement of the Action on the terms and
conditions

provided

for

in

the

[Citco

Stipulation

of

is

Settlement]

fair,

reasonable,

and

adequate

to

the

Settlement Class and should be approved by the Court; whether
a Final Judgment and Order of Dismissal with Prejudice .
as

provided

Settlement]

in

Exhibit

B

to

the

[Citco

should be entered herein;

Stipulation

of

whether the proposed

Plan of Allocation should be approved; to determine the amount
of fees and expenses that should be awarded to Plaintiffs'
Counsel; and to rule upon such other matters as the Court may
deem appropriate."

(Dkt.

No.

1402 at 3-4.)

The Court also

indicated that "[a]ny request for exclusion [from the Citco
Stipulation of Settlement] must be in the form of a written,
signed

statement

and

received

by

the

Claims

Administrator at the address designated in the Notice on or
before 35 days prior to the Settlement Hearing[.]" (Id. at 67.)

Therefore,

all

requests

for

exclusion from

the

Citco

Stipulation of Settlement were due no later than October 16,
2015.
On November 20, 2015, the Court held a Settlement Hearing
(see Dkt.

Minute Entry for Nov.

2,

2015)

and subsequently

issued a Final Judgment and Order of Dismissal with Prejudice
("Final Judgment," Dkt. No. 1457) listing the members of the
Settlement Class who had requested exclusion from the Citco
Stipulation of Settlement on Exhibit 1.

(Dkt. No. 1457, Ex.

1, filed under seal.) All of the exclusions were affiliated
2

with Deminor Recovery Services

( "Deminor" ) .

(See Dkt.

No.

1552 at 2, Dkt No. 1445 at 2.)
By letter dated February 18,

2016

("Anwar Plaintiffs

Letter"), the Anwar Plaintiffs requested permission to file
a motion to reject eight requests for exclusion from the Final
Judgment that were received by the Claims Administrator on
December 28, 2015. 1 (Dkt. No. 1552.) These eight requests were
all affiliated with Deminor, and the Anwar Plaintiffs argue
that Deminor "provided no reason or explanation for the late
submissions."

(Id.

at 2.)

The Court instructed the Claims

Administrator to respond to the Anwar Plaintiffs Letter by
February 23, 2016.

(Id. at 3.)

On February 22,
Consul ting,
indicated

responded
that

it

2016,
to

the Claims Administrator,

the

Anwar

"customarily does

Plaintiffs
not

take

Rust

Letter and
a

position

whether a late request for exclusion should be accepted or
rejected."

(Dkt.

No.

1553 at 1.)

Rather,

it

"reports

the

submission of late requests to counsel and counsel addresses
the appropriate treatment with the Court."

(Id.)

Rule 60 (b) of the Federal Rules of Civil Procedure ("Rule
60(b)") enumerates the reasons for which a court may relieve

A total of nineteen late requests for exclusion were received. However,
eleven requests were identified as duplicates of requests that were
already identified as being excluded from the Citco Stipulation of
Settlement. Therefore, only eight new requests for exclusion were
remaining. (See Dkt. No. 1552 at 2, Dkt. No. 1553 at 2.)
1

3

a party from a final judgment.
Rule 60 (b)

See Fed.

R.

Civ.

provides an equitable remedy that

P.

60(b).

"preserves a

balance between serving the ends of justice and ensuring that
litigation reaches an end within a finite period of time."
Paddington Partners v. Bouchard, 34 F.3d 1132, 1144 (2d Cir.
1994)

(internal citation and quotation marks omitted). As an

equitable remedy, Rule 60(b) "confers broad discretion on the
trial court to grant relief when appropriate to accomplish
justice [and]

it constitutes a grand reservoir of equitable

power

justice

to

do

in

a

particular

LeFevre, 801 F.2d 98, 106 (2d Cir. 1986)

case."

Matarese

v.

(internal citations

and quotation marks omitted) .
Although

not

addressed

by

Deminor

in

identifying the late requests for exclusion
1552,

Ex.

2),

its

letter

(see Dkt.

the Court finds that subsection

(1)

No.

to Rule

60(b) is the likely basis for relief. Under Rule 60(b) (1), a
Court may relieve a party from final judgment due to "mistake,
inadvertence, surprise, or excusable neglect." Fed. R. Civ.
P.

60(b) (1).

requests

Given

that

Deminor

had

submitted

several

for exclusion prior to the deadline and did not

indicate that it failed to do so for these eight investors
due to its own mistake, inadvertence, or surprise, the Court
will

analyze

whether

Deminor's

constitute "excusable neglect."
4

delay

was

sufficient

to

Factors to be considered in evaluating excusable neglect
include "[l]
[2] the

the danger of prejudice to the

length of

the

judicial proceedings,

delay and

its

[non-movant] ,

potential

impact

on

[3] the reason for the delay, including

whether it was within the reasonable control of the movant,
and [4] whether the movant acted in good faith." Silivanch v.
Celebrity Cruises,

Inc.,

(citing Pioneer Inv.

333 F.3d 355,

Servs.

Co.

v.

366

(2d Cir.

2003)

Brunswick Assocs.

Ltd.

P'ship, 507 U.S. 380, 395 (1993)). Based on the above factors,
the

Court

investors

is

not

now

persuaded

requesting

that

Deminor

exclusion

and

have

the

eight

demonstrated

excusable neglect under Rule 60(b) (1).
First, "failure to follow the clear dictates of a court
rule will generally not constitute such excusable neglect."
Canfield v. Van Atta Buick/GMC Truck, Inc., 127 F.3d 248, 250
(2d

Cir.

Settlement

1997).
Class

Here,

the

to opt

deadline

out

of

the

for

members

of

the

Citco Stipulation of

Settlement was "clear and unambiguous." In re Glob. Crossing,
Ltd.

Sec.

Litig.,

No.

02 CIV.

910,

2004 WL 2584874,

at *2

(S.D.N.Y. Nov. 12, 2004). As in In re Global Crossing, Ltd.
Securities Litigation, the deadline was not set by a general
court rule but rather by a specific order in this case, the
August 13 Order,

which directed members of the Settlement

Class "to take action by a particular date,
5

and specifying

the consequences that would ensue from failing to do so." Id.
("Indeed, in this case the deadline was set not merely by a
general

court

overlook,

but

Nachom' s

rule,

case,

letter

from

by

a

which
Court

even
Order

diligent

counsel

specifically

entered

and the notice was provided not

an

adversary,

but

by

an

Order

might
in

simply by

specifically

addressed to Nachom by the Court, specially tailored to his
case,

advising

him of

the

Court's

requirements,

directly

ordering the plaintiff to take action by a particular date,
and specifying the consequences that would ensue from failing
to do so.").
Second, the length of the delay counsels against finding
excusable neglect.

In In re

u. s.

Paine Webber Short Term

Government Income Fund Securities Litigation, the court found
excusable neglect when a party's official notice of opt-out
was received one day late. No. 94 CIV. 3820, 1995 WL 512703,
at

*3

(S.D.N.Y.

Aug.

29,

1995).

In

doing

so,

the

court

distinguished other cases in which "a party's notice of intent
to be excluded from a class arrived a substantial amount of
time [such as one month] after the court-established deadline
or settlement

conference"

Id.;

see,

~'

In re Adelphia

Commc•ns Corp. Sec. & Derivatives Litig., 271 F. App'x 41, 44
(2d

Cir.

neglect

2008)

("Elkmont

because,

despite

did
the
6

not
fact

demonstrate
it

was

excusable

aware

of

the

settlement only one day after the opt out deadline, it still
waited a full month to file its motion for an extension of
time."); Supermarkets Gen. Corp. v. Grinnell Corp., 59 F.R.D.
512, 514 (S.D.N.Y. 1973) aff'd sub nom. Manhattan-Ward, Inc.
v. Grinnell Corp.,
request

for

490 F.2d 1183

extension

under

(2d Cir.

Rule

neglect when counsel was aware

1974)

6(b) (2)

(denying a

for

excusable

of the settlement hearing and

did not file the instant motion until two weeks after the
completion of the hearings) .
Third, Deminor provides no reason for the delay and does
not appear to have acted in good faith.

See In re Adelphia

Commc'ns Corp. Sec. & Derivatives Litig., 271 F. App'x at 44
("To establish excusable neglect, however, a movant must show
good

faith

and

a

reasonable

basis

for

noncompliance.")

(citing In re PaineWebber Ltd. P'ships Litig., 147 F.3d 132,
135 (2d Cir. 1998)). Deminor was affiliated with all of the
exclusions that were filed prior to the deadline of October
16,

2015.

Therefore,

(See Dkt.

No.

1552 at 2,

Dkt.

No.

1445 at 2.)

Deminor was aware of the relevant deadline and

failed to request exclusion for these eight investors in a
timely manner.

In

addition,

in

its

letter

to

the

Anwar

Plaintiffs, Deminor stated that it informed counsel for Citco
Bank Nederland N.V., Citco Fund Services (Europe) B.V., and
Citco Global Custody N.V. in the Dutch proceedings that "all
7

investors who are involved in the Dutch proceedings did not
(and still do not)

consider themselves to be bound by the

provisions of the class settlement in the US class action,
regardless of whether they would be part of the 'Settlement
Class'

and/or would

letter

requesting

Settlement."

(not)
their

(Dkt.

No.

have

(timely)

exclusion

1552,

Ex.

filed an exclusion

from

2.)

the

Citco

Furthermore,

Class

Deminor

stated that even though the eight relevant investors "would
not

(timely)

have

excluded

settlement in the US,
an acceptance,

an

from

the

class

[it] cannot be considered by Citco as

even implicit,

Settlement] .
where

themselves

of the

[Citco Stipulation of

. The only exception we could think of is

investor

would

have

voluntarily

and

formally

accepted to be bound by the [Citco Stipulation of Settlement]
in the US." (Id.) These statements are in direct contradiction
with

the

August

13

Order

which

indicated

that

"[a]ll

Settlement Class Members shall be bound by all determinations
and

judgments

Stipulation

of

in

this

Action

Settlement] ,

concerning

unless

such

the

[Citco

Persons

request

exclusion from the Settlement Class in a timely and proper
manner."

(Dkt.

No.

1402 at 6.)

Thus,

the Court finds that

there was no good-faith reason for the delay in requesting
exclusion.

8

Therefore, since Deminor has not demonstrated excusable
neglect

under

Rule

60 (b) (1),

the

Court

grants

the

Anwar

Plaintiffs request to reject the eight untimely requests to
be excluded from the Final Judgment.
ORDER

For the reasons stated above, it is hereby
ORDERED

that

the

request

of

the

Representative

Plaintiffs on their own behalf and on behalf of the Settlement
Class

(collectively,

"Anwar

Plaintiffs")

to

reject

eight

requests for exclusion from the Citco Final Judgment and Order
of Dismissal (Dkt. No. 1457) that were received by the Claims
Administrator after

the

deadline

for

requesting exclusion

(Dkt. No. 1552) is GRANTED.

SO ORDERED.

Dated:

New York, New York
11 March 2016

z
Victor Marrero
U.S.D.J.

9