The opinion of the court was delivered by: SHIRLEY KRAM, Senior District Judge
In May 2004, the Association of Holocaust Victims for
Restitution of Artwork and Masterpieces ("AHVRAM") and several
individuals (collectively "Plaintiffs") filed a $6.8 billion
lawsuit against various corporations, governmental entities, and
financial institutions, including Bank Austria Creditanstalt AG
("Bank Austria"), alleging the theft, retention, and sale of
artwork looted during the Holocaust. On August 19, 2005, this
Court dismissed Plaintiffs' complaint ("August 19 Order"). Ass'n
of Holocaust Victims for Restitution of Artwork & Masterpieces v.
Bank Austria Creditanstalt AG, No. 04 Civ. 3600, 2005 U.S. Dist.
LEXIS 17411, at *7 (S.D.N.Y. Aug. 19, 2005). In addition, the
Court granted Bank Austria's request for sanctions against Plaintiffs' counsel, Edward D. Fagan, ordered Mr. Fagan to pay
Bank Austria's fees and costs, and fined him $5,000. Id.
Plaintiffs now move for reconsideration of the August 19 Order,
leave to amend their complaint, and a stay of the Court's
judgment.*fn1 For the reasons set forth below, the Court
denies or dismisses all motions. In addition, the Court
establishes the amount of fees and costs due to Bank Austria, and
orders Mr. Fagan to pay his fine to the Court immediately.
I. Plaintiffs' Moving Papers
On September 16, 2005, Plaintiffs filed a "Notice of Motion
Pursuant to FRCP Rule 60," requesting reconsideration of the
August 19 Order, leave to amend their complaint, and a stay of
the Court's judgment ("Notice of Motion for Reconsideration").
(Pls.' Notice of Mot. Pursuant to FRCP Rule 60, Sept. 16, 2005.)
Additionally, Plaintiffs submitted an affidavit signed by Edward
D. Fagan ("Fagan Affidavit"). (Fagan Aff. September 16, 2005.)
However, Plaintiffs failed to submit a memorandum of law in
support of their motion. The Court recognized the omission and,
on September 28, 2005, granted Plaintiffs until October 7, 2005
to supplement the motion. As of this Opinion, Plaintiffs have
neither submitted supplemental materials nor requested a further extension. Consequently, the Court decides Plaintiffs' motion on
the basis of the papers currently before it.
A. Plaintiffs' Motion for Reconsideration is Denied*fn2
Plaintiffs move for reconsideration of the August 19 Order
"based upon newly discovered evidence and for other equitable
reasons" pursuant to Federal Rule of Civil Procedure 60. (Pls.'
Notice of Mot. Pursuant to FRCP Rule 60, at 2.) Although
Plaintiffs do not specify the subsections of Rule 60 that they
believe are applicable, their moving papers only appear relevant
to part (b), subsections (2) and (6).
Under Rule 60(b) (2), a party may move the court to reconsider
an order when the party presents "newly discovered evidence which
by due diligence could not have been discovered" prior to the
order. Fed.R.Civ.P. 60 (b) (2). "In order to succeed on a
motion pursuant to Rule 60 (b) (2), the movant must present
evidence that is `truly newly discovered or . . . could not have
been found by due diligence.'" See United States v. Potamkin
Cadillac Corp., 697 F.2d 491, 493 (2d Cir. 1983) (quoting
Westerly Elecs. Corp. v. Walter Kiddie & Co., 367 F.2d 269, 270
(2d Cir. 1966)), cert denied, 462 U.S. 1144 (1983). New evidence offered in support of the motion must be "highly
convincing." Kotlicky v. United States Fid. & Guar. Co.,
817 F.2d 6, 9 (2d Cir. 1987) (citation omitted).
In support of their motion, Plaintiffs rely on the Fagan
Affidavit, which is largely a personal narrative recounting the
formation of AHVRAM, clarifying the organization's goals, and
restating the merits of the complaint. (Fagan Aff. ¶¶ 3-23,
29-39, 76-82.) These portions of the affidavit present no newly
discovered evidence, and are more naturally read as a long
overdue response to Bank Austria's motion for sanctions, which
challenged the existence of AHVRAM and the validity of the
complaint. (Mot. to Impose Sanctions, Mar. 7, 2005.) Because this
"evidence" is in no sense newly discovered, it clearly does not
comprise proper grounds for reconsideration.
The Fagan Affidavit also alleges that evidence relating to the
substance of their complaint has been discovered "since late
2003/2004" (Fagan Aff. ¶ 40) and "in the last few weeks, months,
and years" (Fagan Aff. ¶ 69). However, the Affidavit fails to
distinguish evidence that was "truly newly discovered" after the
Court's August 19 Order from evidence that Plaintiffs discovered
in the "months" and "years" before that Order. Even assuming that
the Fagan Affidavit alleges any evidence not in Plaintiffs'
possession prior to the Court's Order, the Fagan Affidavit fails
to explain why any of the allegedly new evidence "could not have been found by due diligence" other than to suggest, without
documentation, the existence of "a conspiracy at the highest
levels of government." (Fagan Aff. ¶¶ 50, 71-75.) Plaintiffs'
vague explanations for why evidence was not offered earlier are
unconvincing and unsubstantiated, leading this Court to "reject
the explanations and to consider the `evidence' not newly
discovered." Potamkin Cadillac Corp., 697 F.2d at 493.
Moreover, the Fagan Affidavit's "unsubstantiated conclusory
allegations" of new evidence are not "highly convincing," and
warrant no change from the Court's prior ruling.*fn3 Long
v. Carberry, 151 F.R.D. 240, 244 (S.D.N.Y. 1993). Plaintiffs'
new evidence fails to cure the complaint's "`fundamentally
preliminary' defect[:] lack of subject matter jurisdiction."
Fidenas AG v. Compagnie Internationale Pour L'Informatique CII
Honeywell Bull S.A., 606 F.2d 5, 6 (2d Cir. 1979). To warrant
reconsideration of their complaint, Plaintiffs must present new
evidence providing some indication of the action's jurisdictional
basis. Not a single paragraph of the Fagan Affidavit bears upon the complaint's jurisdictional deficiency.
In short, even if newly discovered, "the evidence presented in
the [Fagan Affidavit] itself would not justify overturning the
prior decision." In re Joint E. & S. Dist. Asbestos Litig.,
774 F. Supp. 116, 120 (S.D.N.Y. 1991).
Under Rule 60 (b) (6), a court also has discretion to grant
reconsideration of an order for "any other reason justifying
relief." Fed.R.Civ.P. 60 (b) (6). Relief under Rule 60 (b) (6)
"is properly invoked where there are extraordinary circumstances,
or where the judgment may work an extreme and undue hardship."
Matarese v. LeFevre, 801 F.2d 98, 106 (2d Cir. 1986) (citations
omitted), cert. denied, 480 U.S. 908 (1987). Plaintiffs'
submissions provide no support for reconsideration under either
of these exceptional grounds. Accordingly, reconsideration under
this subsection is inappropriate.
In light of Plaintiffs' failure to present "highly convincing,"
newly discovered evidence within the meaning of Rule 60 (b) (2),
and because the Court finds no other reasons justifying
reconsideration of its previous Order, Plaintiffs' motion for
reconsideration is denied.
B. Plaintiffs' Request for Permission to File a Second Amended
Complaint Is Dismissed ...