Newton et al v. Beneficial Financial I, Inc. et al
MEMORANDUM OPINION. Signed by Senior Judge Norman K. Moon on 4/16/18. (hnw)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF VIRGINIA
TONIA WOODSON NEWTON, ET AL.,
CASE NO. 3:16-CV-00058
BENEFICIAL FINANCIAL I, INC., ET AL.,
JUDGE NORMAN K. MOON
As will become important, this case started its journey in the Western District with Judge
Conrad. (Dkt. 1). It was transferred to me on December 15, 2017. (Dkt. 87). At that time,
motions to amend the complaint, to compel discovery, and for summary judgment were pending.
On February 16, 2018, the Court entered an order denying the motion to amend the complaint,
denying the motion to compel discovery, and granting the defendants’ motions for summary
judgment. (Dkt. 96). The plaintiffs filed motions for reconsideration of the orders denying the
motion to compel and granting summary judgment on March 19, 2018. (Dkts. 98 & 100). They
filed a notice of appeal later that same day. (Dkt. 102).
A threshold question concerns this Court’s jurisdiction to entertain the motions for
reconsideration. “Generally, a timely filed notice of appeal transfers jurisdiction of a case to the
court of appeals and strips a district court of jurisdiction to rule on any matters involved in the
appeal.” Doe v. Public Citizen, 749 F.3d 246, 258 (4th Cir.2014). However, in Fobian v.
Storage Technology Corp., 164 F.3d 887 (4th Cir.1999), the Fourth Circuit Court of Appeals set
out a limited exception for matters “in aid of the appeal.”
[W]hen a Rule 60(b) motion is filed while a judgment is on appeal, the district
court has jurisdiction to entertain the motion, and should do so promptly. If the
district court determines that the motion is meritless, as experience demonstrates
is often the case, the court should deny the motion forthwith; any appeal from the
denial can be consolidated with the appeal from the underlying order. If the
district court is inclined to grant the motion, it should issue a short memorandum
so stating. The movant can then request a limited remand from this court for that
Id. at 891. Accordingly, the Court has limited jurisdiction to entertain the plaintiffs’ motions
during the pendency of the appeal.
The Court held the motion to compel was denied by operation of Judge Conrad’s
scheduling order, which required the plaintiffs to schedule a hearing or advise the Court that the
motion was ripe for decision within 45 days of filing that motion. (Dkt. 52 at ECF 3; dkt. 62 at
ECF 3; see also Local Rule 11(b) (“[A] motion is deemed withdrawn if the movant does not set
it for hearing (or arrange to submit it without a hearing) within 60 days after the date on which
the motion is filed.”)). The motion had been filed during discovery, but had never been heard,
and the defendants filed motions for summary judgment. The defendants represented “Plaintiffs
never noticed [the motion] for a hearing.” (Dkt. 84). When the case was transferred, the
defendants also submitted a letter indicating they believed the dispute to be resolved and
providing citations to the documents that had been produced. (Dkt. 90). The plaintiffs never
responded to this letter. In light of this information, the Court decided the plaintiffs had failed to
ask for a hearing or submit it without a hearing in the time frame set by Judge Conrad, and
accordingly denied the motion as moot.
However, with its motion for reconsideration, the plaintiffs attached various emails
between themselves, the defendants, and Judge Conrad’s chambers. These emails indicate that
the plaintiffs had attempted to schedule a hearing with the defendants and Judge Conrad’s
chambers, but the parties had been unable to set the hearing before the case was transferred to
me. These communications began in October 2017, within the time frame the parties were
required to set a hearing or submit the motion without a hearing.
To prevail on a motion for reconsideration under Federal Rule of Civil Procedure 60(b),
“a party must demonstrate (1) timeliness, (2) a meritorious defense, (3) a lack of unfair prejudice
to the opposing party, and (4) exceptional circumstances.” Wells Fargo Bank, N.A. v. AMH
Roman Two NC, LLC, 859 F.3d 295, 299 (4th Cir. 2017). The party then must satisfy one of six
specific subsections of the rule. Id. As relevant here, Rule 60(b)(1) states that “the court may
relieve a party . . . from a final judgment, order, or proceeding for . . . mistake, inadvertence,
surprise, or excusable neglect.” See also Robinson v. Wix Filtration Corp. LLC, 599 F.3d 403,
413 (4th Cir. 2010). And Rule 60(b)(6) additionally provides a catch-all category for relief (“any
other reason that justifies relief.”).
The Court is inclined to grant the motion for reconsideration of the motion to compel.
See Fobian, 164 F.3d at 891. The motion for reconsideration was filed thirty days after the entry
of judgment. C.f. CVLR Performance Horses, Inc. v. Wynne, No. 6:11-CV-00035, 2012 WL
5465024, at *3 (W.D. Va. May 23, 2012). It provides undisputed evidence that the defendants
and Judge Conrad’s chambers were aware the plaintiffs had sought a hearing on the motion. C.f.
Augusta Fiberglass Coatings, Inc. v. Fodor Contracting Corp., 843 F.2d 808, 812 (4th Cir.
1988) (“A meritorious defense requires a proffer of evidence which would permit a finding for
the defaulting party or which would establish a valid counterclaim.”). Because the defendants
were aware, the Court finds that any prejudice is not unfair. And the communications with Judge
Conrad’s chambers and the subsequent transfer of the case provide the necessary exceptional
circumstance. The motion to compel was denied on the mistaken belief the plaintiffs had let the
motion languish without discussing it with the Court or the defendants. Accordingly, this is the
rare situation where the Court is inclined to grant the motion for reconsideration.
The Court is also inclined to grant the motion for reconsideration of its order granting the
motions for summary judgment. As the Court noted in its order granting those motions, the
plaintiffs’ opposition to the motions for summary judgment did not address many of the facts
established by the defendants and it contained only two pages of response to the defendants’
arguments in favor of summary judgment. (Dkt. 77 at ECF 7–9). This brevity was partially due
to the plaintiffs’ belief that some discovery materials had not been provided. The above issues
surrounding the motion to compel are intertwined with the motions for summary judgment.
Because the Court is inclined to reconsider its order denying the motion to compel, it is also
inclined to reconsider its order granting the motions for summary judgment.
Given the pendency of the appeal, the Court cannot issue an order addressing these
motions at this point, but “[p]ursuant to the procedure outlined in Fobian, the parties may request
a limited remand from the Fourth Circuit for this purpose.” Hudson v. Pittsylvania Cty., Va., No.
4:11CV043, 2014 WL 10402067, at *3 (W.D. Va. Aug. 4, 2014); Fobian, 164 F.3d at 891 (“If
the district court is inclined to grant the motion, it should issue a short memorandum so
stating.”). The Clerk of the Court is hereby directed to send a copy of this Memorandum
Opinion to Plaintiffs, Defendants, and all counsel of record.
Entered this _____ day of April, 2018.
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