The opinion of the court was delivered by: Dora L. Irizarry, U.S. District Judge
By order dated July 11, 2006 and modified August 29, 2006, this court appointed James F. Castro-Blanco, Esq. as special master to "perform an accounting of all the retirement trust accounts and profit sharing plans relating to the instant litigation to determine whether earnings, forfeiture, and losses were properly allocated to the accounts of all participants." Order Appointing Special Master (ECF docket no. 121), ¶2. By letter dated September 15, 2006, Andrew B. Schultz ("Schultz") and Scott M. Zucker ("Zucker"), on behalf of themselves as defendants and all other defendants in this matter (collectively referred to as "defendants") requested that the court use "its inherent power" under Fed. R. Civ. P. 60(b) to "withdraw the appointment of a special master" and "stay the order for the appointment and payment of a special master," " in the interest of justice." (ECF docket no. 138).*fn1 The request was opposed by all plaintiffs in a letter dated September 18, 2006 (ECF docket no. 139) and the opposition was responded to by Zucker, on behalf of all the defendants, on September 19, 2006 (ECF docket no. 140). McDonough again joined the request by letter dated September 25, 2006 and asked the court to reconsider the apportionment of responsibility for the special master's fees during the pendency of the action (ECF docket no. 153) and Danziger & Markhoff joined McDonough's application by letter on October 10, 2006. (ECF docket no. 155). For the reasons set forth below, defendants' request is denied in its entirety.
As an initial matter, Rule 60(b) does not govern the defendants' request. Rather, defendants are referring to the "plenary power of the court to review its interlocutory orders to afford such relief from them as justice requires." Wanamaker v. Columbian Rope Co., 907 F.Supp. 522, 527 (W.D.N.Y. 1995). This power is separate and apart from the court's Rule 60(b) powers, which only apply to a "final judgment." Krome v. Merrill Lynch & Co., Inc., 110 F.R.D. 693, 694 (S.D.N.Y. 1986); Fed.R.Civ.P. 60 advisory committee's note, 1946 amendment ("interlocutory judgments are not brought within the restrictions of the rule, but rather they are left subject to the complete power of the court rendering them to afford such relief from them as justice requires."). Likewise, although not invoked by defendants, Rule 54(b) provides, in relevant part, that an interlocutory "order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties." Fed.R.Civ.P. 54(b). Accordingly, defendants request will be analyzed under these two provisions.
Pursuant to Rule 54(b), the court may revise a prior order if there is "an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent a manifest injustice." Virgin Atl. Airways, Ltd. v. Nat'l Mediation Bd., 956 F.2d 1245, 1255 (2d Cir.1992). Similarly, the court's plenary power to review its own interlocutory orders may be applied in circumstances "when it is consonant with justice to do so." U.S. v. LoRusso, 695 F.2d 45, 53 (2d Cir. 1983). Rule 54(b) permits an order to be revised "anytime before the entry of judgment adjudicating all the claims." Fed. R. Civ. P. 54(b). Similarly, the court may exercise its plenary power to review its own orders "any time" the court has jurisdiction over the case. See First City, Texas-Houston, N.A. v. Rafidain Bank, 131 F.Supp.2d 540, 543 (S.D.N.Y. 2001). The defendants made this request for the withdrawal of the order appointing the special master more than sixty days after the special master's appointment and seventeen days after the court established the basis and terms of the special master's compensation -- but immediately after defendants received the special master's first invoice. Even though the request was made while the court still has jurisdiction over the case and before the claims have been fully adjudicated, the timing of this request is questionable, and the entire request may simply be an acute case of sticker shock.*fn2 Moreover, under most circumstances (and unless the court specifically directs otherwise) motions for reconsideration of a court order must be made within ten days after the entry of the order. See Local Civil Rule 6.3. Thus, defendants' request is denied as untimely. However, to place the defendants at ease with regard to the appointment of the special master, and to correct some misstatements and distortions put forward by defendants, the court will, nevertheless, address the merits of the request.
Defendants request that the court withdraw or stay the order appointing the special master because they allege that (1) none of the parties requested a special master; (2) the appointment of the special master was made before the defendants' time to answer had expired; (3) the court did not identify "any specific need" for a special master and did not set guidelines for a special master; (4) the terms and the basis of the special master's compensation are too generous and the allocation of responsibility for payment of the special master's compensation is unjust; and (5) the special master's relationship with the court makes his appointment improper. The court will address each of these claims in turn.
(1) Appointment of a Special Master
Defendants assert that none of the parties requested a Special Master. They are correct. In fact, at a conference before the court on June 19, 2006, plaintiffs requested the much more drastic remedy of the appointment of an independent trustee to oversee the fund for the duration of this litigation due to Spitz's alleged mismanagement. (Tr. 10:5-16). Defendants vigorously opposed the appointment of an independent trustee. The court found that, because there was no finding of wrongdoing on the part of defendants, it would be premature to appoint an independent trustee. (Tr. 16:4-9). Rather, the court suggested the appointment of a Special Master. The transcript of the June 19, 2006 conference reads as follows:
COURT: It seems to me, unless I can hear some valid objection as to why the court should not appoint a Special Master at this juncture, that would be an appropriate way to go.
COURT: So, it does also seem appropriate, if counsel wishes, to file an amendment to the amended complaint; that the court will grant permission to do so. This way, the defense can respond to the complaint. In the interim, the court can go about the business of appointing a Special Master and letting counsel know who that will be. Of course, the order will be made available to counsel. I'll hear the parties with respect to that proposal by the court. Mr. Zucker?
ZUCKER: No objection, your Honor.
MULTER: No objection. (Tr. 17:10-13; 18:1-11).
In their September 19, 2006 letter (ECF docket no. 140), defendants reinterpret this exchange and claim that they were actually only consenting to the procedure by which the appointment would be made, not the actual appointment. However, the plain language of the transcript (as well as the court's contemporaneous notes of the hearing) unequivocally show that the parties consented to the court "appointing a Special Master and letting the parties know who that will be." (Tr. 18:7). Moreover, the appointment of the special master was clearly not contingent upon the parties first filing and answering an amended complaint. The court rejects the notion that a lawyer, seeing an ambiguity, would answer "no objection" and let the ambiguity lie unresolved. Moreover, any ambiguity was resolved by the July 11, 2006 order appointing Mr. Castro-Blanco as Special Master. The defendants were notably silent upon receiving this order. The court believes that if the defendants had really agreed only to the procedure of appointing the Special Master, rather than the actual appointment of one, they would have reacted very differently to the July 11, 2006 order. It is abundantly clear that the parties consented to the appointment of the Special Master on June 19, 2006, and further consented to allow the court to select the master.*fn3
(2) Timing of the appointment of the Special Master The June 19, 2006 conference was attended by defendants Schultz, and Zucker, as well as Irwin N. Rubin of Danziger & Markhoff.*fn4 At the conference, plaintiffs' counsel made a presentation regarding what he alleged to be impermissible payments of ERISA protected funds to counsel for defendant Sheldon Spitz, namely Zucker, Shultz, McDonough and Danziger & Markhoff. (Tr. 8:10 -10:7). Plaintiffs were given permission to file an amended complaint by July 7, 2006 to assert whatever new claims they may have and to add defendants, as necessary. (Tr. 18:2-3). The amended complaint was initially served on July 7, 2006, and a corrected amended complaint was served on July 14, 2006. (ECF docket no. 122). The parties (now including Zucker, Shultz, McDonough and Danziger & Markhoff) consented to extend the defendants' time to answer or otherwise move to September 12, 2006. Later, Zucker, Shultz, McDonough and Danziger & Markhoff requested another extension, which the court granted. (ECF docket nos. 124, 135, 137). Defendants claim that it was inappropriate to appoint a Special Master on July 11, 2006 because "plaintiffs. . . had not served any amended complaint, and had not stated any intention of naming attorneys as defendants." See September 15, 2006 letter (ECF docket no. 138). As the amended complaint was initially served July 7, 2006, four days before the appointment of the Special Master, this claim is without merit. Further, with the exception of McDonough, who was not present at the June 19th conference, any assertion that the defendants were blind sided by the allegations in the amended complaint is disingenuous. From the record, as well as the court's contemporaneous notes, its clear that defendants were placed on notice that they would be added to the complaint. It is also clear that both the parties and the court understood that the case would proceed normally (the complaint would be amended to include the new defendants) notwithstanding the appointment of the Special Master. In any event, all the defendants (McDonough and Danziger & Markhoff included) are protected ...