Stiching Pensioenfonds ABP v. Bank of America Corporation et al
MEMORANDUM AND ORDER ON RULE 54(b) MOTION granting (962) Motion for Entry of Judgment under Rule 54(b) in case 1:09-md-02058-PKC. The Court concludes, for the reasons stated, that there is no just reason for delay. Plaintiffs motion for entry of jud gment under Rule 54(b) is GRANTED. The Clerk is directed to terminate the motion (09 MD 2058, Docket # 962) and shall enter judgment for the defendants solely as to the claims brought by plaintiff KERS & Co. (10 Civ. 2284; 09 MD 2058.) (Signed by Judge P. Kevin Castel on 11/4/2013) Filed In Associated Cases: 1:09-md-02058-PKC, 1:10-cv-02284-PKC (rsh)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
IN RE: BANK OF AMERICA CORP.
SECURITIES, DERIVATIVE, AND
EMPLOYEE RETIREMENT INCOME
SECURITY ACT (ERISA) LITIGATION
DOC #: _ _---;.,-_ __
1/- (5 -/3
Master File No. 09 MD 2058 (PKC)
THIS DOCUMENT RELATES TO:
KERS & Co., et al.,
10 Civ. 2284 (PKC)
-againstMEMORANDUM AND ORDER
ON RULE 54(b) MOTION
BANK OF AMERICA CORP., et al.,
P. KEVIN CASTEL, District Judge:
In order to pursue an e)[pedited appeal from an order of this Court, plaintiff KERS
& Co. ("KERS") moves to be severed from this action and for final judgment to be entered
against it pursuant to Rule 54(b), Fed. R. Civ. P. (09 MD 2058, Docket # 962.) Defendants take
no position on KERS's motion. (09 MD 2058, Docket #967.) Because KERS's proposed appeal
is limited only to whether it timely sought e)[clusion from the class, and, if not, whether its
failure to do so constituted e)[cusable neglect, the motion is granted.
KERS is one of several individual plaintiffs who brought claims in the abovecaptioned action, KERS & Co., et al. v. Bank of America COlP., et al., 10 Civ. 2284 (the
"Individual Action"). The Individual Action alleges that Bank of America Corp. ("BofA"), its
officers and directors violated the federal securities laws when they made alleged material
misstatements and omissions related to BofA's acquisition of Merrill Lynch & Co. in 2008. The
Individual Action, along with several related actions, has proceeded before the undersigned for
pretrial coordination pursuant to the multidistrict litigation statute, 28 U.S.C. § 1407.
This Court entered judgment in the parallel Consolidated Securities Class Action
on April 9, 2013. (09 MD 2058, Docket # 871.) In a Memorandum and Order dated June 5,
2013, this Court concluded that KERS failed to submit a timely request to opt out as a class
member in the Consolidated Securities Class Action, and that it had not come forward with
evidence that its inaction was the product of excusable neglect. See KERS & Co. v. Bank of
America Corp. (In re Bank of America Corp. Sec., Derivative & ERISA Litig.), 2013 WL
2443748 (S.D.N.Y. June 5, 2013) (the "June Order").
As described in KERS's submissions, KERS is presently in a procedural holding
pattern. Several other plaintiffs remain in the Individual Action, which continues to be actively
litigated. Motions for summary judgnlent are being briefed in the Individual Action, and, in the
event that those motions do not dispose of the case in its entirety, a jury trial will be scheduled
KERS has filed a "conditional" proof of claim in the Consolidated Securities
Class Action, which states in part, "In the event the Court rules that KERS & Co. is excluded
from the class, KERS & Co. disclaims any interest in any recovery from the class settlement and
rescinds this Proof of Claim, including without limitation the release contained herein."
(Eskridge Dec. Ex. C., Rider.) KERS notes that an appeal of the class action settlement is
currently pending, and that "[w Jith the class settlement already on appeal, finality there will
likely occur before final adjudication with respect to the entirety of the Individual Actions."
(KERS Mem. at 2.) It appears to be KERS's contention that ifit does not immediately appeal
the June Order, it will inevitably be bound to the class action settlement, whereas if it
successfully appeals the June Order, it will thereafter be free to proceed with its claims as an
individual, opt-out plaintiff. (KERS Mem. at 2-3.)
"In general, there is a historic federal policy against piecemeal appeals," and entry
of final judgment "is generally appropriate only after all claims have been adjudicated." Novick
v. AXA Network, LLC, 642 F.3d 304, 310 (2d Cir. 2011) (quotation marks omitted). "Not all
final judgments on individual claims should be immediately appealable, even ifthey are in some
sense separable from the remaining umesolved claims." Curtiss-Wright COl)). v. Gen. Electric
Co., 446 U.S. 1,8 (1980). Rule 54(b), which provides an exception to this general rule, must be
applied "sparingly." Novick, 642 F.3d at 310. Rule 54(b) states in relevant part:
When an action presents more than one claim for relief - whether
as a claim, counterclaim, crossclaim, or third-p31ty claim - or
when mUltiple parties are involved, the court may direct ently of a
final judgment as to one or more, but fewer than all, claims or
parties only if the COUlt expressly detennines that there is no just
reason for delay.
"The function of the district COUlt under the Rule is to act as a 'dispatcher,'" and whether to grant
a Rule 54(b) motion is within this Court's "sound judicial discretion." Curtiss-Wright, 446 U.S.
at 8. "The power which this Rule confers upon the trial judge should be used only in the
infiequent harsh case, i.e., certification should be granted only ifthere exists some danger of
hardship or injustice through delay which would be alleviated by immediate appeal." O'Belt ex
reI. Estate ofO'Bert v. Vargo, 331 F.3d 29,41 (2d Cir. 2003) (quotation marks and internal
"[I]t is incumbent upon a P31ty seeking immediate relief in the form of a Rule
54(b) judgment to show not only that the issues are sufficiently separable to avoid judicial
inefficiency but also that the equities favor entry of such ajudgment." Novick, 642 F.3d at 314.
The Second Circuit has instmcted district courts to closely scrutinize Rule 54(b) motions:
The requirement that the district cOUli make an express
determination "that there is no just reason for delay," Fed. R. Civ.
P. 54(b), means that the court must provide a reasoned, even if
brief, explanation of its considerations, for it is essential that a
reviewing court have some basis for distinguishing between wellreasoned conclusions, arrived at after a comprehensive
consideration of all relevant factors, and mere boiler-plate approval
phrased in appropriate language but unsupported by evaluation of
the facts or analysis of the law. A certification that is not
appropriate is insufficient to confer appellate jurisdiction.
rd. at 31 0 (quotation marks, alterations and internal citations omitted).
A district court reviewing a Rule 54(b) motion must consider both the equities in
favor ofthe motion and "'the interest of sound judicial administration.'" Cmtiss-Wright, 446
u.s. at 8 (quoting Sears, Roebuck &
Co. v. Mackey, 351 U.S. 427, 437 (1956)). "Among the
factors a COUlt must consider when weighing the equities of a motion to enter a Rule 54(b)
judgment are the relatedness of the pending and adjudicated claims, the factual bases for the
claims and the effect a decision on the pending claims would have on the questions raised on
appeal." Sluader v. Granninger, 870 F.2d 874, 878 (2d Cir. 1989).
As to the interests of sound judicial administration, the Second Circuit has
"repeatedly noted that the district cOUli generally should not grant a Rule 54(b) certification 'if
the same or closely related issues remain to be litigated. ", Novick, 642 F.3d at 311 (quoting
Harriscom Svenska AB v. Han'is Com., 947 F.2d 627, 629 (2d Cir. 1991)). It is a waste of
judicial resources to require multiple appellate panels to acquaint themselves with an action if
there are "successive appeals fi'om successive decisions on inten'elated issues." rd. A district
court also should "consider such factors as whether the claims under review [are] separable from
the others remaining to be adjudicated and whether the nature of the claims already detelmined
[is] such that no appellate court would have to decide the same issues more than once even if
there were subsequent appeals." Curtiss-Wright, 446 U.S. at 8. For instance, Novick concluded
that the district court abused its discretion when granting Rule 54(b) certification as to a party's
contract claim, when that claim implicated the interpretation of a second contract that continued
to be litigated in the district court. 642 F.3d at 311-13. Many ofthe same issues would therefore
be reviewed by two separate appellate panels. Id. at 313-14.
Here, KERS's contemplated appeal is limited to the issue of whether it submitted
a timely request to opt out of the consolidated securities class action, and, if not, whether its
failure to do so is a product of excusable neglect.
In re Am. Express Fin. Advisors Sec.
Litig., 672 F.3d 113,129 (2d Cir. 2011) (discussing excusable neglect standard). The proposed
appeal would not go to the merits of the pending summary judgment motions in the Individual
Action, and would not implicate the merits of either the Individual Action or the class action
settlement. It would be limited to a discrete record conceming KERS' s communications related
to the opt -out deadline and authority related to the excusable neglect standard. There appears to
be no risk that granting KERS's Rule 54(b) motion would subject multiple panels to a review of
the same issues. See generally Curtiss-Wright, 446 U.S. at 8. At the same time, ifKERS's
present motion is denied, it would foreclosed from meaningful appellate review of the June
Order, which could be appealed only after all other claims in the Individual Action are resolved
by this Court. There is no just reason for such a delay.
This is a rare instance where the grant of a Rule 54(b) motion is appropliate. The
equities favor entry of judgment. Given the narrow and KERS-specific issues, there is no risk of
piecemeal appeal, and certification is in the sound interest of judicial administration.
The Court concludes, for the reasons stated, that there is no just reason for delay.
Plaintiffs motion for entry of judgment under Rule 54(b) is GRANTED. The Clerk is directed
to telminate the motion (09 MD 2058, Docket # 962) and shall enter judgment for the defendants
solely as to the claims brought by plaintiffKERS & Co. (10 Civ. 2284; 09 MD 2058.)
United States District Judge
Dated: New York, New York
November 4, 2013
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