Del Prado v. BN DEVELOPMENT CO., INC., 09-10581.
| Decision Date | 05 April 2010 |
| Docket Number | No. 09-10581.,09-10581. |
| Citation | 602 F.3d 660 |
| Parties | Romulo DEL PRADO, on behalf of Himself and a Class of Judgment Creditors of the Estate of Ferdinand E. Marcos, Plaintiff-Appellant, v. B. N. DEVELOPMENT COMPANY, INC.; Ellesmere Investment Corporation, Inc.; Jason Development Company, Inc.; Langley Investment Corporation, Inc.; Pender Investment Corporation, Inc.; Revelstoke Investment Corporation, Inc.; Vernon Investment Corporation, Inc., Defendants-Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Robert A. Swift (argued), Kohn, Swift & Graf, Philadelphia, PA, S. Patrick Woodson, IV, Woodson Law Firm, Fort Worth, TX, Sherry P. Broder, Honolulu, HI, for Plaintiff-Appellant.
Eugene D. Gulland, Joshua D. Greenburg, Neil K. Roman (argued), Covington & Burling, L.L.P., Washington, DC, Elizabeth Ellen Mack, Locke, Lord, Bissell & Liddell, L.L.P., Dallas, TX, Janet Ellen Militello, Neale Andersen Shields, Locke, Lord, Bissell & Liddell, L.L.P., Houston, TX, for Defendants-Appellees.
Before REAVLEY, DAVIS and STEWART, Circuit Judges.
This case presents the question of whether a judgment entered in one federal court and then registered in a second federal court pursuant to 28 U.S.C. § 1963, may be re-registered and enforced in a third federal court, a process termed "successive registration." Under § 1963, a judgment from one federal court that is registered in another federal court "shall have the same effect as a judgment of the district court of the district where registered and may be enforced in like manner." This statutory language, together with the authorities cited below, persuade us that registered judgments are to be given the same effect as rendered judgments so that § 1963 permits registration and enforcement of registered judgments in the third district court. We therefore reverse the district court and remand the case.
This case arises out of the class action brought against Ferdinand Marcos, the former President of the Philippines. After President Marcos arrived in the United States in 1986, he was served with numerous complaints claiming damages for human rights violations. These cases were consolidated into the federal district court in Hawaii. In 1991, the Hawaiian federal district court certified the case as a class action. Between 1992 and 1995, three separate jury trials were held concerning the issues of liability and damages. Ultimately, President Marcos was cast in judgment for nearly $2,000,000,000 in damages to the plaintiff-appellant class. Final judgment on the class action was entered in the Hawaiian federal district court on February 3, 1995 (hereinafter "the Hawaiian judgment"), and was thereafter affirmed by the Ninth Circuit. See Hilao v. Estate of Marcos, 103 F.3d 767 (9th Cir.1996) ("Hilao I"). In 1997, the Ninth Circuit issued its mandate for the Hawaiian judgment.
In 1997, the plaintiff registered the Hawaiian judgment in the Northern District of Illinois pursuant to 28 U.S.C. § 1963 (hereinafter "the Illinois registered judgment"), as well as in other jurisdictions located outside of the United States.
On April 8, 2005, the plaintiff registered the Hawaiian judgment in the Northern District of Texas pursuant to 28 U.S.C. § 1963. The plaintiff also filed a complaint against the defendants-appellees alleging they held legal title to Texas property for which the Marcos estate held equitable title. The plaintiff sought to enforce the registered Hawaiian judgment in Texas by foreclosing on that property.
In 2006, the defendants notified the plaintiff that the 1995 Hawaiian judgment expired pursuant to Hawaiian Revised Statute § 657-51 before the plaintiff had registered the Hawaiian judgment in the Northern District of Texas. Recognizing this flaw in the registration, on June 5, 2006, the plaintiff filed a motion in the Hawaiian federal district court for an extension of the Hawaiian judgment. On June 27, 2006, the Hawaiian district court entered an order extending the Hawaiian judgment. The Hawaiian district court reasoned that the Hawaiian judgment was not final until the issuance of the mandate by the Ninth Circuit in 1997. Based on that reasoning, the district court found that the motion for extension was timely filed in the Hawaiian federal district court.
In 2008, the Ninth Circuit reversed and vacated the extension granted by the Hawaiian district court. See Hilao v. Estate of Marcos, 536 F.3d 980 (9th Cir.2008) ("Hilao II"). The Ninth Circuit held that the date of final judgment was February 3, 1995, the date that the judgment was entered by the Hawaiian district court, not the date of the issuance of the mandate by the Ninth Circuit in 1997. Because HRS § 657-5 states that "no extension of a judgment or decree shall be granted unless the extension is sought within ten years of the date the original judgment or decree was rendered," the Ninth Circuit found that relief on the plaintiff's June 5, 2006 motion to extend the judgment was time-barred.
On September 4, 2008, the plaintiff timely revived the Illinois registered judgment in the Northern District of Illinois.2 On October 10, 2008, the plaintiff registered the revived Illinois registered judgment in the Northern District of Texas pursuant to § 1963. On October 14, 2008, the plaintiff filed a motion to amend the original complaint filed on April 8, 2005, to reflect its intent to enforce the revived Illinois registered judgment. Arguing that the court should not recognize the Illinois registered judgment, the defendants filed a 12(b)(6) motion to dismiss.
The Texas federal district court denied the plaintiff's motion to amend the complaint and granted the defendants motion to dismiss the plaintiff's suit. The plaintiff timely filed this appeal.
Under Federal Rule of Civil Procedure 15(a), a "court should freely give leave to file amended pleadings when justice so requires." We review the district court's denial of the plaintiff's motion to amend for an abuse of discretion. Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962). We review de novo an order granting a 12(b)(6) motion to dismiss. In re: Katrina Canal Breaches Litigation, 495 F.3d 191, 205 (5th Cir. 2007).
On appeal, the plaintiff argues that two judgments were properly registered and may be enforced in the Northern District of Texas: (1) the Hawaiian judgment, as registered in Texas on April 8, 2005, and (2) the Illinois registered judgment, as successively registered in Texas on October 10, 2008. The enforceability of these judgments is discussed separately.
The plaintiff argues that the Hawaiian judgment did not become final until December 6, 1995 because on that date the Hawaiian federal district court entered a final judgment as to all of the consolidated actions in this matter. Therefore, the plaintiff asserts that the Hawaiian judgment was properly registered in Texas federal district court within ten years of its entry and may be enforced in Texas.
The defendants counter that res judicata and collateral estoppel preclude the plaintiff from re-litigating the date on which the Hawaiian judgment became final for the purposes of triggering the ten year statute of limitations. According to the defendants, the Ninth Circuit in Hilao II necessarily decided that the final judgment was rendered by the Hawaiian federal district court for this purpose on February 3, 1995. Because the plaintiff has already litigated the issue of when the final judgment was entered and the Ninth Circuit has already reached a conclusion on that issue, the defendants assert that the plaintiff is barred from re-litigating the issue.
We agree with the defendants that the Ninth Circuit actually decided the effective date of the Hawaiian judgment and that the plaintiffs are precluded from relitigating this issue. See United States v. Davenport, 484 F.3d 321, 325-26 (5th Cir.), cert. denied, 552 U.S. 1076, 128 S.Ct. 805, 169 L.Ed.2d 606 (2007) (citations omitted) (discussing res judicata); Pace v. Bogalusa City Sch. Bd., 403 F.3d 272, 290 (5th Cir.2005) (citations omitted) (discussing collateral estoppel). Moreover, the plaintiff waived its argument on this issue by failing to raise it to the district court until the reply brief to a Motion for Reconsideration. See Browning v. Navarro, 894 F.2d 99, 100 (5th Cir.1990) (citations omitted) ("Generally speaking a party may not raise an argument for the first time in a petition for rehearing.").
Because more than ten years passed between the entry of the Hawaiian judgment and its registration in Texas, the Hawaiian judgment expired before it was registered in Texas. A judgment may only be registered and enforced at a time when the judgment is still enforceable in the state from which it is being registered. See Home Port Rentals, Inc. v. Int'l Yachting Group, Inc., 252 F.3d 399, 405 (5th Cir.2001). As such, the Hawaiian judgment may not be registered and enforced by the Texas federal district court.
The plaintiff argues next that § 1963 permits the Illinois registered judgment, which is valid and enforceable in the Northern District of Illinois,3 to be successively registered and enforced in the Northern District of Texas. Sec.1963 states in pertinent part:
A judgment in an action for the recovery of money ... entered in any ... district court ... may be registered by filing a certified copy of the judgment in any other district ... when the judgment has become final by appeal or expiration of the time for appeal or when ordered by the court that entered the judgment for good cause shown .... A judgment so registered shall have the same effect as a judgment of the district court of the district where registered and may be enforced in like manner.
The defendants counter that successive registration is not allowed under § 1963 because a registered judgment is only...
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