Old Carco LLC and RJM I, LLC, as Liquidation Trustee for Old Carco L

UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
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In re: 	: 	Chapter 11
:
OLD CARCO LLC, et al., 	: 	Case No. 09-50002 (SMB)
:
Debtors. 	: 	Jointly Administered
:
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MEMORANDUM DECISION DENYING FRANKIE
OVERTON’S MOTION FOR RELIEF FROM
THE COURT’S ENFORCEMENT ORDER
A P P E A R A N C E S:
SULLIVAN & CROMWELL LLP
125 Broad Street
New York, New York 10004
Brian D. Glueckstein, Esq.
Of Counsel
Attorneys for FCA US LLC
COLE SCHOTZ P.C.
1325 Avenue of the Americas
19th Floor
New York, New York 10019
Mark Tsukerman, Esq.
Of Counsel
BEASLEY, ALLEN, CROW, METHVIN,
PORTIS & MILES, P.C.
P.O. Box 4160
Montgomery, Alabama 36103
J. Parker Miller, Esq. (pro hac vice)
Stephanie Monplaisir, Esq. (pro hac vice)
Of Counsel
Attorneys for Frankie Overton, as Executor
of the Estate of Sue Ann Graham
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STUART M. BERNSTEIN
United States Bankruptcy Judge:
After exhausting the appellate process, Plaintiff Frankie Overton (“Overton”), as
executor of the estate of Sue Ann Graham, filed Frankie Overton’s Motion for Relief
from the Court’s “Enforcement Order” to Permit Her to Pursue an Independent Claim
Against FCA US LLC (“Motion”), dated July 23, 2020 (ECF Doc. # 8549-1). The
Motion asks this Court to correct what Overton characterizes as a clerical error in the
Order Granting in Part and Denying in Part FCA US LLC’s Motion to Enforce the Sale
Order (“Enforcement Order”), dated Nov. 14, 2018 (ECF Doc. # 8535). The
Enforcement Order enjoins Overton from prosecuting claims against FCA US LLC
(“FCA” or “New Chrysler”) under the Alabama Wrongful Death Act (“AWDA”). The
Motion asks the Court to modify the Enforcement Order to allow Overton to amend the
complaint (“Complaint”) filed in the Circuit Court of Jefferson County, Alabama
(“Alabama State Court”) in a case styled Overton v. Chrysler Group LLC, No. 01-CV-
2017-904376-EAF, to assert new claims against New Chrysler. 1 	For the reasons that
follow, Overton’s motion is denied.
BACKGROUND
The facts are set out in this Court’s prior decision, In re Old Carco LLC, 593 B.R.
182 (Bankr. S.D.N.Y. 2018) (“Overton I”), the District Court’s decision affirming
Overton I, see Overton v. FCA US LLC (In re Old Carco LLC), 603 B.R. 877 (S.D.N.Y.
2019) (“Overton II”), and the Second Circuit’s decision affirming Overton II, see
Graham v. FCA US LLC (In re Old Carco LLC), 809 F. App’x. 36 (2d Cir. 2020)
1 	A copy of the proposed Amended Complaint is attached as Exhibit B to the Motion.
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(“Overton III”) (summary order). I assume familiarity with those decisions and limit
the background discussion to the facts relevant to the disposition of the Motion.
On April 30, 2009, Old Carco LLC (“Old Chrysler”) filed these chapter 11 cases.
On June 1, 2009, the Court approved a sale order (the “Sale Order”) and master
transaction agreement (the “MTA”) by which Old Chrysler sold substantially all of its
assets to New Chrysler free and clear of any claims against Old Chrysler except for
certain Assumed Liabilities. The MTA was eventually amended (Amendment No. 4) to
extend New Chrysler’s Assumed Liabilities to include product liability claims for
personal injuries or wrongful death arising from post-Closing accidents involving
vehicles manufactured and sold by Old Chrysler (“Old Chrysler Vehicles”) before June
10, 2009, the Closing Date of the sale transaction. However, Amendment No. 4
expressly excluded liability for punitive damages. The Sale Order did not limit New
Chrysler’s liability for its own post-Closing wrongful conduct involving an Old Chrysler
Vehicle, such as the breach of an independent duty, if any, imposed on New Chrysler to
warn about a defect in an Old Chrysler Vehicle or recall it. Overton I, 593 B.R. at 199.
A. 	Alabama Litigation
On June 10, 2016, Sue Ann Graham and her child, J.G., a minor, were riding as
passengers in a 2002 Jeep Liberty, an Old Chrysler Vehicle, when it was struck by
another vehicle. Sue Ann Graham was killed as a result of the accident; J.G. was
seriously injured but survived. On October 17, 2017, Frankie Overton, as administrator
of the estate of Sue Ann Graham (“Decedent”), and Scott Graham, as legal guardian of
J.G., filed the Complaint in Alabama State Court against, among others, New Chrysler.
As to the Decedent, Overton sought punitive damages under the AWDA, the only
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available remedy for wrongful death under Alabama law. While the Complaint mainly
asserted that the Jeep was defectively manufactured, the plaintiffs also alleged that the
“Product Liability Defendants,” a term that included New Chrysler, had failed to warn
about or recall the allegedly defective Jeep. (Complaint ¶¶ 32, 44, 47, 51, 54, 56.)
Overton did not, however, separately request punitive damages in connection with
claims based on New Chrysler’s post-Closing failure to warn or recall. In contrast,
Graham sought compensatory damages against all defendants and also sought “punitive
damages for FCA’s post-bankruptcy sale conduct, transactions, actions, or failures to act
which caused the chain of events and injuries giving rise to this action.” (Complaint pp.
8, 11-12, 15.)
B. 	Prior Bankruptcy Litigation
New Chrysler eventually returned to this Court seeking to enjoin Overton and
Graham from pursuing punitive damages with regard to all of their claims, including the
failure to warn/recall claims. (See FCA US LLC’s Motion to Enforce the Court’s Order
(I) Authorizing the Sale of Substantially All of the Debtors’ Assets Free and Clear of All
Liens, Claims, Interests and Encumbrances, (II) Authorizing the Assumption and
Assignment of Certain Executory Contracts and Unexpired Leases in Connection
Therewith and Related Procedures and (III) Granting Related Relief, dated Mar. 12,
2018 (“Motion to Enforce Sale Order”) (ECF Doc. # 8510).)2 On November 1, 2018, the
Court issued Overton I, concluding that Amendment No. 4 barred Overton’s claims for
2 	New Chrysler moved to reopen the Chapter 11 case on the same day, (see ECF Doc. # 8508), and
the Court granted that motion for the limited purpose of adjudicating New Chrysler’s motion to enforce
the Sale Order. (See Order, Pursuant to Section 350 of the Bankruptcy Code, Bankruptcy Rule 5010 and
Local Bankruptcy Rule 5010-1, Reopening the Chapter 11 Case of Old Carco LLC for the Limited Purpose
of Considering FCA US LLC’s Motion to Enforce the Sale Order, dated June 25, 2018 (ECF Doc. # 8531).)
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punitive damages, her only remedy under Alabama law. See 593 B.R. at 199. As to the
Graham claims, the Court held that the Sale Order “may not bar a claim that arises from
wrongful conduct occurring after the sale.” Id. 	Therefore, the Graham claims were not
barred by the Sale Order “to the extent they seek compensatory damages or punitive
damages based on the post-Closing breach of duty to warn or recall . . . .” Id. The Court
did not make a similar determination with regard to the Overton claims.
The Court directed the parties to settle an order. Id. Counsel for Overton
reviewed and consented to the draft order proposed by counsel for New Chrysler,
subject to one change regarding the Court’s jurisdiction that New Chrysler accepted.
(See email, dated Nov. 8, 2018, attached as Exhibit B to the Declaration of Brian D.
Glueckstein in Support of Opposition of FCA US LLC to Frankie Overton’s Motion for
Relief from the Court’s “Enforcement Order” to Permit Her to Pursue an Independent
Claim Against FCA US LLC, dated Aug. 4, 2020 (“Glueckstein Decl.”) (ECF Doc. #
8552).) Counsel for New Chrysler then submitted the draft order to the Court with a
representation that the form of order was “acceptable to the parties” and copied counsel
for Overton on the communication. (See email, dated Nov. 13, 2018, Glueckstein Decl.,
Exhibit C.)
On November 14, 2018, the Court entered the Enforcement Order, the order
negotiated and approved by the parties, implementing its decision. The Enforcement
Order stated in relevant part:
2. 	Plaintiff Overton is enjoined from prosecuting claims against FCA
US under the Alabama Wrongful Death Act in Alabama State Court, either
in the action captioned Overton v. Chrysler Group LLC, Case No. CV 17-
904376-EAF, pending in the Circuit Court of Jefferson County, Alabama,
or otherwise.
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3. 	Plaintiff Graham’s claims for compensatory damages are not barred
by the Sale Order. To the extent he has alleged a legally sufficient claim for
breach of duty to warn or recall under Alabama law, Plaintiff Graham may
also seek punitive damages for any injuries that were proximately caused
by FCA US’s post-Closing conduct.
(Enforcement Order ¶¶ 2-3.) Because Overton’s sole remedy was to seek punitive
damages under the AWDA, the Enforcement Order barred her post-Closing failure to
warn/recall claims against New Chrysler.
Overton appealed from the Enforcement Order to the United States District
Court for the Southern District of New York. Her brief to the District Court included a
footnote stating the “[Enforcement Order] currently improperly bars Overton from
pursuing claims against [New Chrysler] for its own post-Closing Date conduct.”
(S.D.N.Y. Case No. 18-11290, ECF Doc. # 13 at 6 n.4.) On May 31, 2019, the District
Court affirmed, holding that the Overton claims sought punitive damages which are
barred by the unambiguous terms of the Sale Order. Overton II, 603 B.R. at 888. The
District Court did not address Overton’s footnote regarding claims based on New
Chrysler’s post-Closing conduct.
Overton then appealed to the Second Circuit, which affirmed the judgment of the
District Court. 	Overton III, 809 F. App’x at 40. Her brief again raised the argument
that the Enforcement Order improperly barred her from bringing claims based on post-
Closing conduct. (See 2d. Cir. Case No. 19-1901, Overton Brief, ECF Doc. # 44 at 31
(“The lower courts’ rulings barring Overton’s post-sale conduct claims constitute clear
error and should be reversed.”); 2d. Cir. Case No. 19-1901, Overton Reply, ECF Doc. #
89 at 21 (“Overton has asserted claims against [New Chrysler] for its post-sale failure to
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warn since the filing of her complaint in 2017.”).) The Second Circuit concluded that
Overton had forfeited this argument by failing to raise it properly:
Finally, Overton argues that it was clear error for the lower courts to bar
her claim to the extent it was based on New Chrysler’s post-sale conduct.
Although in her complaint Overton specifically requested “punitive
damages for [New Chrysler’s] post-bankruptcy sale conduct” only with
respect to Jordan Graham’s injuries, App’x 274, 278, 281, she did allege
that “[a]s a proximate result” of New Chrysler’s post-sale failure “to warn,
recall or otherwise eliminate the defective condition” of the 2002 Jeep
Liberty, “Sue Ann Graham suffered catastrophic injuries that resulted in
her death,” App’x at 277. Because Overton raised this argument only in a
footnote to the district court, it is “forfeited.” United States v. Greenfield,
831 F.3d 106, 118 n.9 (2d Cir. 2016); D. Ct. Dkt. No. 13 at 6 n.4.
Overton III, 809 F. App’x at 40 n. 1 (alterations in original). The Second Circuit issued
its mandate on June 10, 2020. (See Glueckstein Decl., Exhibit D.)
C. 	The Motion
Her appeals exhausted, Overton returned to this Court seeking relief from the
Enforcement Order to amend the Complaint “to permit Overton to assert and prosecute
a claim against FCA under the Alabama Wrongful Death Act based solely on FCA’s post-
Closing conduct.” (Proposed Order at ¶ 2, dated July 23, 2020 (ECF Doc. # 8549-2).)
She argues in the main that the language in the Enforcement Order enjoining her from
prosecuting such claims was a clerical error under Rule 60(a) of the Federal Rules of
Civil Procedure because it does not accurately reflect the Court’s decision in Overton I
and it bars her from asserting the same type of claims the Court allowed Graham to
prosecute. 	(Motion at 7-9; see Frankie Overton’s Reply to FCA US LLC’s Opposition to
Her Motion for Relief from the Court’s “Enforcement Order” to Permit Her to Pursue
an Independent Claim Against FCA US LLC (“Reply”) at 8-10, dated Aug. 7, 2020 (ECF
Doc. # 8553).) Alternatively, she asks the Court to grant the same relief under the
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catch-all provision of Rule 60(b)(6), which permits the Court to provide substantive
relief from a final judgment under “extraordinary circumstances” or to prevent “undue
hardship.” (Motion at 9-11; Reply at 10-12.)
New Chrysler opposes the Motion. (See Opposition of FCA US LLC to Frankie
Overton’s Motion for Relief from the Court’s “Enforcement Order” to Permit Her to
Pursue an Independent Claim Against FCA US LLC (“Opposition”) (ECF Doc. # 8551).)
First, New Chrysler argues that the “mandate rule” forecloses relitigation of issues
previously forfeited by a defendant, and the Second Circuit held that Overton had
“forfeited” the argument that the Enforcement Order improperly enjoined her from
asserting post-Closing claims against New Chrysler. (Opposition at 5-7.) Second, Rule
60(a) does not apply because the challenged portion of the Enforcement Order
accurately reflects Overton I, and the language was agreed to by the parties. (Id. at 7-8.)
Third, Rule 60(b) is similarly unavailable to Overton because (i) her claim is one of
judicial mistake under Rule 60(b)(1), not clerical error under Rule 60(a), and her Rule
60(b)(1) claim is time-barred, (id. at 9-10); and (ii) she failed to establish the
“extraordinary circumstances” required for relief under Rule 60(b)(6). (Id. at 11.)
During oral argument, counsel for Overton conceded that if the Court determines that
the Motion should have been brought under Rule 60(b)(1), “then under the statute [sic],
it is time barred because it’s been more than a year.” (Transcript of 8/11/20 Hr’g (“Tr.”)
at 23:8-9 (ECF Doc. # 8554).)
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DISCUSSION
A. 	The Mandate Rule
The Mandate Rule “requires a trial court to follow an appellate court’s previous
ruling on an issue in the same case.” United States v. Quintieri, 306 F.3d 1217, 1225 (2d
Cir. 2002). A subset of the law of the case doctrine, the terms are sometimes used
interchangeably. See id. Importantly, “the law of the case does not extend to issues an
appellate court did not address.” New England Ins. Co. v. Healthcare Underwriters
Mut. Ins. Co., 352 F.3d 599, 606 (2d Cir. 2003) (quoting Moore v. Anderson, 222 F.3d
280, 284 (7th Cir. 2000)) (internal quotation marks omitted); see also Schwabenbauer
v. Bd. of Educ. of City Sch. Dist. of City of Olean, 777 F.2d 837, 841-42 (2d Cir. 1985)
(law of the case did not apply to dictum contained in a prior opinion’s footnote). “As
long as the appellate court has not expressly or implicitly ruled on the issue, the district
court has not transgressed any jurisdictional boundaries by amending after an appeal
has been taken.” Panama Processes, S.A. v. Cities Serv. Co., 789 F.2d 991, 994 (2d Cir.
1986).
The Second Circuit did not address Overton’s claim that the Enforcement Order
improperly cut off post-Closing claims. The issues presented to and decided by the
Second Circuit were threefold: “(1) [whether] the punitive damages exclusion in the
bankruptcy sale documents is ambiguous because it does not define ‘punitive damages’;
(2) [whether] damages under the AWDA are not punitive damages and therefore do not
fall within the punitive damages exclusion; and (3) [whether] enforcing the punitive
damages exclusion would violate Alabama public policy.” Overton III, 809 F. App’x at
37; (see also 2d. Cir. Case No. 19-1901, Overton Brief, ECF Doc. # 44 at 3 (listing
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statement of issues on appeal); FCA US LLC Brief, ECF Doc. # 68 at 6 (listing
counterstatement of issues on appeal).) The question of Overton’s post-Closing claims
was not raised in this Court and was only mentioned in a footnote in Overton’s District
Court brief. Although she argued the issue more extensively before the Second Circuit,
the Second Circuit concluded that it had been forfeited because she raised it only in a
footnote before the District Court. Overton III, 809 F. App’x. at 40 n.1; see City of New
York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir. 2011) (“We ordinarily deem
an argument to be forfeited where it has not been sufficiently argued in the briefs, . . .
such as when it is only addressed in a footnote[.]”) (internal quotation marks and
citation omitted); accord United States v. Restrepo, 986 F.2d 1462, 1463 (2d Cir. 1993).
Thus, the Second Circuit never decided the issue now presented to this Court.
Rather, the Second Circuit declined to review the issue because of a procedural
deficiency, and law of the case does not apply to an argument a court refused to hear
based on a procedural deficiency. See DeWeerth v. Baldinger, 38 F.3d 1266, 1271 (2d
Cir. 1994) (because appellate court’s denial of motion to recall the mandate without
opinion could have been on procedural grounds rather than on the merits, district court
could subsequently rule on same issues in a Rule 60(b) motion); O’Connor v. Pierson,
482 F. Supp. 2d 228, 233 (D. Conn. 2007) (where appellate court declined to address
res judicata argument because issue was not properly preserved for appeal, law of the
case did not bar district court from subsequently deciding the issue), aff’d, 568 F.3d 64
(2d Cir. 2009); see also United States v. Ackerman, 804 F. App’x 900, 903 (10th Cir.
2020) (where appellate court “declined to consider the government’s good-faith-
exception argument because it was insufficiently briefed,” “the district court still had the
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authority to consider the good-faith exception on remand” because appellate court “did
not render a decision on the merits”); Burley v. Gagacki, 834 F.3d 606, 618 (6th Cir.
2016) (law of case doctrine inapplicable where appellate court in prior appeal “found the
issue moot given the evidence precluded was not presented” and “did not ‘squarely
decide’ the merits of the district court’s rulings”).
New Chrysler cites United States v. Quintieri for the proposition that the
Mandate Rule “ordinarily forecloses relitigation of all issues previously waived by the
defendant.” 306 F.3d at 1225. While the quotation is accurate, the holding is narrower
than New Chrysler suggests. In Quintieri, the Second Circuit had remanded during an
earlier appeal for the limited purpose of deciding whether the District Court had
improperly enhanced the Defendant’s sentence by double-counting certain offenses. Id.
at 1223. On remand, the defendant made several additional arguments regarding his
original sentencing that he had failed to raise during the first appeal. Id. at 1225. The
Second Circuit concluded that the defendant was foreclosed from raising these other
issues because the remand was limited to the double counting issue and the defendant
was not entitled to de novo review of his sentencing. Id.
In this case, there is no similar mandate directing the Court to consider any
specific issue and only that issue. Furthermore, unlike the defendant in Quintieri,
Overton raised the issue of the Enforcement Order’s overbreadth, but the Second Court
declined to consider it because it was only raised below in a footnote and never decided
by the District Court. Finally, the Mandate Rule does not prohibit a court from
correcting a clerical mistake under Rule 60(a), see Panama Processes, 789 F.2d at 994;
see also 12 MOORE’S F EDERAL PRACTICE - CIVIL § 60.12 (2020) (“A district court may
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correct a clerical mistake even after an appellate court has decided the case.”), or
granting relief under Rule 60(b) where the appellate court has not implicitly or explicitly
decided the issue raised in the Rule 60(b) motion. See DeWeerth, 38 F.3d at 1271.
Accordingly, the Mandate Rule does not bar the Court from considering the relief
sought in Motion.
B. 	Rule 60(a)
According to Overton, the Enforcement Order contains a clerical mistake to the
extent it bars her post-Closing claims, and that clerical mistake can be rectified under
Rule 60(a) of the Federal Rules of Civil Procedure 60(a). 3 	Rule 60(a) permits a court to
conform an order to the “contemporaneous intent of the court,” but “not to reflect a new
and subsequent intent of the court.” In re Marc Rich & Co. A.G., 739 F.2d 834, 837 (2d
Cir. 1984). “The relevant distinction is ‘between what is erroneous because the thing
spoken, written or recorded is not what the person intended to speak, write or record,
and what is erroneous because the person later discovers that the thing said, written or
recorded was wrong. The former comes within Rule 60(a); the latter does not.” Id.
(quoting Allied Materials Corp. v. Superior Prod. Co., 620 F.2d 224, 226 (10th Cir.
1980)). In determining whether Rule 60(a) is appropriate, “reviewing courts primarily
look to the contemporaneous intent of the district court as evidenced by the record.”
Panama Processes, 789 F.2d at 995.
3 	Rule 60 is made applicable to this contested matter by Bankruptcy Rule 9024. Rule 60(a)
provides: “The court may correct a clerical mistake or a mistake arising from oversight or omission
whenever one is found in a judgment, order, or other part of the record.” F ED . R. CIV . P. 60(a).
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The Enforcement Order accurately reflects the contemporaneous intent of this
Court. The Overton Complaint sought damages under the AWDA as a result of the
death of Sue Ann Graham. (See Complaint at pp. 8, 11, 14-15.) The issue she presented
to this Court with respect to Overton’s claims was all or nothing ─ could she could
continue to prosecute her claims for the Decedent’s wrongful death given the punitive
nature of AWDA damages and the exclusion of punitive damages under Amendment No.
4? She did not distinguish, as Graham did, (see Plaintiffs’ Opposition to FCA US LLC’s
Motion to Enforce the Court’s Order (I) Authorizing the Sale of Substantially All of the
Debtors’ Assets Free and Clear of All Liens, Claims, Interests and Encumbrances, (II)
Authorizing the Assumption and Assignment of Certain Executory Contracts and
Unexpired Leases in Connection Therewith and Related Procedures and (III) Granting
Related Relief, dated May 4, 2018, at 25-28 (ECF Doc. # 8523)), between liability for
punitive damages based on the defective manufacture of the vehicle by Old Chrysler and
the post-Closing breach by New Chrysler of an independent duty to warn or recall. 	The
Court answered the question Overton raised in the negative, and the Enforcement Order
accurately reflects that disposition.
Furthermore, the Motion concedes that the survival of Overton’s post-Closing
claims was never presented to or decided by the Court. (See Motion at 9 (“FCA did not
make any ‘independent claim’ type argument in its Motion to Enforce as against
Overton, Overton did not assert an independent claim defense in its opposition papers,
and the Court never considered whether Overton could assert or plead an independent
claim in its decision.”); Reply at 9 n.5 (“[T]he Court, understandably, was not focused
on and did not consider any argument that Overton could assert an independent claim.
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No such argument was ever made in the parties’ briefing.”); id. at 10 (“Overton did not
plead her failure to warn claim against FCA in the Complaint as an independent claim
the way Graham did”).) Similarly, Overton’s counsel admitted at oral argument that the
Court never considered whether Overton could assert an independent, post-Closing
claim because she failed to raise it. (See Tr. at 5:7-8 (“that argument was never had
because that was never before the Court at all”); id. at 4:22-23 (“this [issue] wasn’t in
the papers, so we’re not surprised that the Court didn’t consider it”).) Finally, the
Enforcement Order was the product of negotiation between counsel, and Overton’s
counsel did not object to it.
Overton nevertheless argues that the Court has already decided that “[t]he
Graham Claims are not barred by the Sale Documents to the extent they seek
compensatory damages or punitive damages based on the post-Closing breach of a duty
to warn or recall,” Overton I, 593 B.R. at 199, and argues that the Court would have
made the same holding with respect to the Overton claims. Assuming that to be correct,
Overton did not make that argument on her own behalf, the Court never considered or
decided it, and the Enforcement Order does not fail to express the Court’s
contemporaneous intent regarding an issue that was neither raised nor decided. In
short, even if the Court made a mistake in not deciding it, it is not the type of clerical
mistake that can now be decided through a motion under Rule 60(a).
C. 	Rule 60(b)
Overton alternatively seeks the same relief based on the same mistake under Rule
60(b)(6). The alternative request overlooks the limitations on relief under Rule 60(b).
Rule 60(b)(1), on which Overton does not rely, provides that a party may be relieved
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from a final judgment or order for “mistake, inadvertence, surprise, or excusable
neglect,” FED. R. CIV. P. 60(b)(1), but such a motion must be made “no more than a year
after the entry of the judgment or order,” F ED. R. CIV. P. 60(c)(1). The Enforcement
Order was entered on November 14, 2018, and the Motion was made on July 23, 2020,
more than 20 months later. Thus, the Motion, if made under Rule 60(b)(1), would be
time-barred, as Overton’s counsel conceded at oral argument.
Realizing that the Rule 60(b)(1) would be time-barred, Overton instead moved in
the alternative under Rule 60(b)(6). Rule 60(b)(6) allows relief from judgment based
on “any other reason that justifies relief,” F ED. R. CIV. P. 60(b)(6), and the motion must
be made “within a reasonable time,” F ED. R. CIV. P. 60(c)(1). Assuming that the Motion
was made within a reasonable time, the alternative Motion nevertheless fails.
Rule 60(b)(6) has been described as “a grand reservoir of equitable power to do
justice in a particular case[,] . . . [b]ut that reservoir is not bottomless.” Stevens v.
Miller, 676 F.3d 62, 67 (2d Cir. 2012) (internal quotation marks and citations omitted).
“Of particular concern is that parties may attempt to use Rule 60(b)(6) to circumvent
the one-year time limitation in other subsections of Rule 60(b).” Id. “Recognizing this
concern, [the Second Circuit] ha[s] found that Rule 60(b)(1) and Rule 60(b)(6) are
‘mutually exclusive,’ such ‘that any conduct which generally falls under the former
cannot stand as a ground for relief under the latter.’” Id. (quoting United States v.
Cirami, 535 F.2d 736, 740 (2d Cir. 1976)); accord United Airlines, Inc. v. Brien, 588
F.3d 158, 175 (2d Cir. 2009) (“The two provisions are exclusive and ‘an appellant cannot
circumvent the one-year limitation [of Rule 60(b)(1)] by invoking the residual clause (6)
of Rule 60(b).”) (quoting Serzysko v. Chase Manhattan Bank, 461 F.2d 699, 702 (2d
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Cir. 1972) (per curiam)) (alteration in original); Maduakolam v. Columbia Univ., 866
F.2d 53, 55-56 (2d Cir. 1989) (Rule “60(b)(6) cannot provide relief, because the grounds
stated are covered under 60(b)(1).”). Thus, “[w]here a party’s Rule 60(b) motion is
premised on grounds fairly classified as mistake, inadvertence, or neglect, relief under
Rule 60(b)(6) is foreclosed.” Stevens, 676 F.3d at 67. As Overton’s Motion is based on
the mistaken overbreadth of the Enforcement Order, she is limited to Rule 60(b)(1), she
cannot rely on Rule 60(b)(6), and relief under Rule 60(b)(1) is time-barred.
Finally, Overton argues that the Court has a general equitable power to amend
the Enforcement Order outside of Rule 60. (See Tr. at 14:2-9, 24:3-6; Reply at 11-12.)
She fails to cite any authority supporting this proposition, and while equitable
considerations may well favor her position, the Court lacks the power to grant relief that
Rule 60 forecloses.
Accordingly, the Motion is denied. The Court has considered Overton’s
remaining arguments and concludes that they lack merit. Submit Order.
Dated: 	New York, New York
October 22, 2020
/s/Stuart M. Bernstein
STUART M. BERNSTEIN
United States Bankruptcy Court
09-50002-mg Doc 8556 Filed 10/22/20 Entered 10/22/20 15:39:07 Main Document
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