United States District Court, S.D. New York
May 05, 2004.
SUSAN AUGIENELLO, RICHARD J. DORAN, PHILIP EINHORN, CRAIG NAZARRO, and EILEEN PAPP, Plaintiffs, -against- FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver for SUPERIOR BANK FSB, Defendant
The opinion of the court was delivered by: ROBERT SWEET, Senior District Judge
Pro se plaintiffs Susan Augienello ("Augienello"), Richard J. Doran
("Doran"), Philip Einhorn ("Einhorn"), Craig Nazzaro ("Nazzaro") and
Eileen Papp ("Papp") (collectively, the "Plaintiffs") have moved pursuant
to Local Civil Rule 6.3 and Fed.R.Civ.P. 60 for relief from the March
25, 2004 opinion dismissing the claims against defendant Federal Deposit
Insurance Corporation ("FDIC"), as Receiver of Superior Bank, FSB
("Superior") (the "FDIC-Receiver"). See Augienello v. FDIC. 02 Civ.
4317, 2004 WL 585829 (S.D.N.Y. March 25, 2004), or alternately for
transfer to the District Court of the District of Columbia. For the
following reasons, the motion is denied.
The proceedings in this case prior to the dismissal of the Plaintiffs'
case are recounted in the March 25 opinion, familiarity with which is
presumed. In the March 25 opinion, it was held that subject matter
jurisdiction was lacking because jurisdiction exists only in the district
in which Superior's principal place of business is located or the United
States District Court for the District of Columbia, and because
Superior's principal place of business is in the Northern District of
Illinois. Id., at *5-9. On April 2, 2004, Plaintiffs filed the instant motion. After submission
of briefs, the motion was deemed fully submitted on April 28, 2004.
Plaintiffs' Motion for Reconsideration is Denied
In addressing the present motion, the Court is mindful that Plaintiffs
are proceeding pro se and that their submissions should be held "`to less
stringent standards than formal pleadings drafted by lawyers. . . .'"
Hughes v. Rowe, 449 U.S. 5, 9 (1980) (per curiam) (quoting Haines v.
Keener, 404 U.S. 519, 520 (1972)); see also Ferran v. Town of Nassau,
11 F.3d 21, 22 (2d Cir. 1993). Indeed, district courts should "` read the
pleadings of a pro se plaintiff liberally and interpret them to raise the
strongest arguments they suggest.'" McPherson v. Coombe, 174 F.3d 276,
280 (2d Cir. 1999) (quoting Burgos v. Hopkins, 14 F.3d 787, 790 (2d Cir.
1994)). Nevertheless, the Court is also aware that pro se status "does
not exempt a party from compliance with relevant rules of procedural and
substantive law." Traguth v. Zuck, 710 F.2d 90, 95 (2d Cir. 1983)
A motion for reconsideration under Local Civil Rule 6.3" is appropriate
where a court overlooks `controlling decisions or factual matters that
were put before it on the underlying motion and which, had they been
considered, might have reasonably altered the result before the court.'"
Banco. de Sequros Del Estado v. Mut. Marine Offices, Inc., 230 F. Supp.2d 427, 428 (S.D.N.Y. 2002)
(quoting Range Rd. Music, Inc. v. Music Sales Corp., 90' F. Supp.2d 390,
392 (S.D.N.Y. 2000)). "The standard for granting . . . a motion [for
reconsideration] is strict, and reconsideration will generally be denied
unless the moving party can point to controlling decisions or data that
the court overlooked matters, in other words, that might reasonably be
expected to alter the conclusion reached by the court." Shrader v. CSX
Transp., Inc., 70 F.3d 255, 257 (2d Cir. 1995). "[A] motion for
reconsideration may be granted to `correct a clear error or prevent
manifest injustice.'" Banco, 230 F. Supp.2d at 428 (quoting Griffin
Indus., Inc, v. Petrojam, Ltd., 72 F. Supp.2d 365, 368 (S.D.N.Y. 1999)).
However, this must be "narrowly construed and strictly applied so as to
avoid repetitive arguments on issues that have been considered fully by
the Court." Dellefave v. Access Temps., Inc., 99 Civ. 6098, 2001 WL
286771, at *1 (S.D.N.Y. Mar. 21, 2001).
Plaintiffs' motion does not present any legal decisions that the Court
has overlooked. Plaintiffs have instead submitted twelve numbered
"facts," without evidentiary support, which Plaintiffs argue demonstrate
that Superior's principal place of business is in New York, and hence
that subject matter jurisdiction exists to hear their claim. Each of the
facts, however, were either not put before the Court on the underlying
motion or were taken into consideration in the March 25 opinion.
Accordingly, Plaintiffs have not met the strict standard for reconsideration,
and the motion pursuant to Local Civil Rule 6.3 is denied.
Plaintiffs' Motion for Relief under Rule 60 is Denied
Plaintiffs' motion states that it is made under Fed.R.Civ.P. 60, but it
does not state whether it is made under Rule 60(a) or Rule 60(b).
However, because " [a] motion under Rule 60(a) is available only to
correct a judgment `for the purpose of reflecting accurately a decision
that the court actually made,'" Hodge ex rel. Skiff v. Hodge, 269 F.3d 155,
158 (2d Cir. 2001) (quoting Truskoski v. ESPN, Inc., 60 F.3d 74, 77 (2d
Cir. 1995)), and because Plaintiffs have not alleged that the March 25
opinion does not accurately reflect the Court's decision, Plaintiffs'
motion will be construed as a motion under Rule 60(b). Rule 60(b)
provides, in relevant part:
On motion and upon such terms as are just, the court
may relieve a party or a party's legal representative
from a final judgment, order, or proceeding for the
following reasons: (1) mistake, inadvertence,
surprise, or excusable neglect; (2) newly discovered
evidence . . .; (3) fraud . . ., misrepresentation, or
other misconduct of an adverse party; (4) the judgment
is void; (5) the judgment has been satisfied, released
or discharged . . .; or (6) any other reason
justifying relief from the judgment.
As explained by the court in Williams v. New York City Dep't of
Corrections, 219 F.R.D. 78, 83-84 (S.D.N.Y. 2003), "A motion under Rule 60(b) is addressed to the sound
discretion of the trial court." Velez v. Vassallo,
203 F. Supp.2d 312, 333 (S.D.N.Y. 2002) (citing
Mendell In Behalf of Viacom, Inc. v. Gollust,
909 F.2d 724
, 731 (2d Cir. 1990)); . . . Rule 60(b)
provides an opportunity for courts to balance fairness
considerations present in a particular case against
the policy favoring the finality of judgments.
Kotlicky v. United States Fidelity Guar. Co., 817 F.2d 6
9 (2d Cir. 1987); Broadway v. City of New York, 2003
WL 21209635, at *3 (S.D.N.Y. May 21, 2003)
(Patterson, J.) ("While Rule 60(b) was designed to
strike a balance between the interests of fairness and
the finality of judgments, `final judgments should not
be lightly reopened.'") (citing Nemaizer v. Baker,
793 F.2d 58
, 61 (2d Cir. 1986)); Velez, 203 F. Supp.2d
at 333. However, Rule 60(b) motions "are generally
granted only upon a showing of exceptional
circumstances." Mendell In Behalf of Viacom, 909 F.2d
at 731; Nemaizer, 793 F.2d at 61 (holding that Rule
60(b) motions are "extraordinary judicial relief" that
can be granted "only upon a showing of exceptional
circumstances."); Salomon v. 1498 Third Realty Corp.,
148 F.R.D. 127, 128 (S.D.N.Y. 1993).
In order to prevail on a Rule 60(b) motion, the Second Circuit has held
the courts generally "require that the evidence in support of the motion
to vacate a final judgment be highly convincing, that a party must show
cause for failure to act sooner, and that no undue hardship be imposed on
the other parties." Kotlicky, 817 F.2d at 9 (internal quotations and
citations omitted). Pro se litigants "are not . . . excused from the
requirement that they produce highly convincing' evidence to support a
Rule 60(b) motion." Gil v. Vogilano, 131 F. Supp.2d 486, 494 (S.D.N.Y.
2001); see also Broadway v. City of New York, 96 Civ. 2798, 2003 WL
21209635, at *3 (S.D.N.Y. May 21, 2003) ("the heavy burden for securing
relief from final judgments applies to pro se litigants as well as to
those who are represented by counsel."). Defendant argues that Plaintiffs have not alleged any of the available
grounds for relief under Rule 60(b). In reply, Plaintiffs argue that
they have alleged neglect, misrepresentation and misconduct on the part
of Defendant, and that they have submitted newly discovered evidence. The
alleged misrepresentation consists in: 1) Defendant providing misleading
information about the management of Superior; 2) Defendant's "hiding
behind the corporate veneer constructed by Superior Bank FSB's owners";
and 3) the Defendant's providing only a partial picture of Superior's
situation. The newly discovered evidence is a deposition taken from a
director of Superior, and handwritten notes from that Director which
demonstrate that "the contractual obligations at issue in this case were
fully vested . . ."
Even if the newly discovered evidence proved what Plaintiffs allege, it
would make not affect the lack of subject matter jurisdiction. Further,
Plaintiffs have not submitted any "highly convincing evidence," Gil, 131
F. Supp.2d at 494, to prove that the Defendant has made any
misrepresentations. The heart of the underlying decision is that
Superior's principal place of business was in Illinois. See Augienello,
2004 WL 585829, at *7-9. Because Superior operated its business
nationwide with offices in Illinois, New York, and eleven other states,
the "nerve center" test was applied to determine the principal place of
business. Id., at *7 (citing R.G. Barry Corp. v. Mushroom Makers, Inc.,
612 F.2d 651, 655 (2d Cir. 1979)). It was further held that "the `nerve center' test places the principal place of business at the
location of the corporation's headquarters," id. (citing Compucon
Distrib. of New England, Inc. v. Cooper, 685 F. Supp. 424, 425 (S.D.N.Y.
1988), which for Superior is in Oakbrook Terrace, Illinois. Nothing
submitted by the Plaintiffs has shown that this conclusion was
incorrect. Plaintiffs have therefore not met their burden of showing that
any exceptional circumstances merit a grant of relief under Rule 60(b).
Plaintiffs' Request to Transfer is Denied
Plaintiffs' motion in the alternative to transfer this case to the
District Court of the District of Columbia under the motion for
reconsideration is denied because no such request was before the Court on
the underlying motion. "It is well established that a motion for
reconsideration is not the proper vehicle to advance new arguments or
theories under the facts alleged." Melnitzky v. Rose, 305 F. Supp.2d 349,
352 (S.D.N.Y. 2004).
Under Plaintiffs' Rule 60(b) motion, the request could only be
considered under exceptional circumstances. See Mendell In Behalf of
Viacom, 909 F.2d at 731. A district court may transfer an action
after a finding of want of jurisdiction "if it is in the interest of
justice." 28 U.S.C. § 1631. However, the Second Circuit has held that it is
not in the interest of justice to transfer a meritless claim under §
1631. See Adeleke v. United States, 355 F.3d 144, 152 (2d Cir. 2004) (citing Phillips v. Seiter, 173 F.3d 609,
610-11 (7th Cir. 1999)). In its brief on the underlying motion, the FDIC
demonstrated convincingly that Plaintiffs' contract claim had been
considered by this Court in the related action and that decision was
upheld by the Second Circuit. See Augienello v. Coast-to-Coast Financial
Corp., 01 Civ. 11608, 2003 WL 1822926, at *2-3 (S.D.N.Y. Aug. 7, 2002),
aff'd, 64 Fed. Appx. 820, 2003 WL 21069080 (2d Cir. May 9, 2003).
Further, the cause of action for breach of an implied covenant of good
faith and fair dealing would not be enforceable as the federal
regulations which terminated the Defendant's obligations under the
contract preempt state law in the area of savings and loan industry
regulation. See Rush v. FDIC, 747 F. Supp. 575 (N.D. Cal. 1990)
("Congress has developed a comprehensive scheme for regulating the
savings and loan industry; thus federal regulations governing the savings
and loan industry preempt attempts by states to regulate in that
field."). Therefore, no exceptional circumstances exist which would
justify transferring this action. Conclusion
For the foregoing reasons, Plaintiffs' motions to reconsider the March
25 opinion under Local Civil Rule 6.3 and for relief from the judgment
under Rule 60(b) are denied.
It is so ordered.
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