Raymone K. Bain & Davis, Bain & Assocs., Inc. v. MJJ Prods., Inc.

• Decision Date: 13 May 2014
• Docket Number: No. 12–7061.,12–7061.
• Citation: 751 F.3d 642
• Court: U.S. Court of Appeals — District of Columbia Circuit
• Parties: Raymone K. BAIN and Davis, Bain & Associates, Inc., Appellants v. MJJ PRODUCTIONS, INC. and Estate of Michael Joseph Jackson, Appellees.

751 F.3d 642

Raymone K. BAIN and Davis, Bain & Associates, Inc., Appellants

v.MJJ PRODUCTIONS, INC. and Estate of Michael Joseph Jackson, Appellees.

No. 12–7061.

United States Court of Appeals,District of Columbia Circuit.

Argued Dec. 6, 2013.

Decided May 13, 2014.

Appeal from the United States District Court for the District of Columbia, (No. 1:09–cv–00826).

Joseph M. Creed argued the cause for appellants. With him on the briefs were Steven M. Pavsner and Levi S. Zaslow.

Henry W. Asbill argued the cause for appellees. With him on the briefs were Jennifer Bradley Lichter, Howard L. Weitzman, and Jeremiah T. Reynolds. Ryan J. Watson entered an appearance.

Before: BROWN and SRINIVASAN, Circuit Judges, and WILLIAMS, Senior Circuit Judge.

SRINIVASAN, Circuit Judge:

In December 2003, the late entertainer Michael Jackson retained Davis, Bain & Associates, Inc., to act as his public relations firm. One of the firm's founders, Raymone Bain, began serving as a spokesperson and publicist for Jackson, later becoming his general manager. In May 2009, Ms. Bain and her firm (collectively, Bain) sued Jackson and his production company, MJJ Productions, Inc., claiming to be owed substantial sums for various services rendered. Those services included arranging the release of a 25th anniversary edition of Jackson's album, Thriller, generally recognized to be the best-selling album in history. The defendants (collectively, MJJ) moved to dismiss, relying principally on a December 2007 release agreement signed by Jackson and Bain. In the release agreement, Bain broadly relinquished any claims against Jackson and his business entities. The district court granted summary judgment in favor of MJJ, holding that the release agreement precluded Bain's claims.

Five months later, Bain moved for relief from judgment under Federal Rule of Civil Procedure 60(b)(2). Rule 60(b)(2) allows for relief based on “newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial.” The “newly discovered evidence” cited by Bain was an April 2008 letter from Jackson to Bain, in which Jackson stated that he had no awareness of, and had never signed, the release agreement on which the district court had grounded its grant of summary judgment. The district court denied the Rule 60(b)(2) motion. Because we find no abuse of discretion in the district court's ruling that Bain failed to exercise reasonable diligence in seeking out the April 2008 letter, we affirm.

I.

According to the complaint, in May 2006, Bain and Jackson entered into a Personal Services Agreement. The agreement authorized Bain to incorporate a new company (the Michael Jackson Company) on Jackson's behalf, and appointed her the new company's president and chief operating officer. As compensation, she would receive a “10% Finder's fee of any Agreement(s) entered into by Michael Jackson, or the Michael Jackson Company, generated by, or due to the direct efforts of Bain and/or Bain's contacts.” J.A. 31. Bain alleged that she initiated a number of such projects, for which she claims to be owed compensation amounting to at least $44 million. Bain brought suit against MJJ in federal district court, invoking the court's diversity jurisdiction.

MJJ moved to dismiss the complaint based on a “Payment and Release Agreement” (the Release) signed by Bain in December 2007, which MJJ claimed absolved it of liability under the Personal Services Agreement. The Release provided that Jackson would render a payment to Bain in the amount of $488,820.05, as “full and final satisfaction of any [and] all monies, known or unknown, to be owed to you by the Jackson Parties with respect to any and all agreements whether verbal or written that you may have entered into with the Jackson Parties from the beginning of time until December 27, 2007.” J.A. 104. One week after MJJ filed its motion to dismiss, Jackson unexpectedly died.

In opposing dismissal, Bain argued that the Release was defective due to fraud in the inducement, misrepresentation, and mistake. Bain also contended that the Release was facially ambiguous, permitting consideration of parol evidence to interpret the contract. Bain asserted that she intended to discharge claims for past debts and liabilities, not claims concerning future work or deals yet to be finalized. In addition, Bain expressed doubt about the authenticity of Jackson's signature on the Release. Finally, she requested the opportunity to conduct discovery to support her challenges.

Because the defendants' motion to dismiss relied on matters outside the pleadings—namely, the Release—the district court converted the motion into one for summary judgment. The court granted both sides additional time to supplement the record with “all the material that is pertinent to the motion.” J.A. 274–75. Bain's attorney filed an affidavit under Federal Rule of Civil Procedure 56(d), stating that, if permitted by the court, Bain would conduct discovery concerning Jackson's intent in the Release and the authenticity of his signature.

On May 7, 2010, the district court granted summary judgment in favor of the defendants, holding that the unambiguous language of the Release barred Bain's claims. See Bain v. Jackson, 783 F.Supp.2d 13, 17 (D.D.C.2010). The court rejected Bain's contentions that the Release was voidable due to fraud in the inducement or mistake. Id. at 17–18. The court also denied Bain's requests for discovery. Id. at 18 n. 4. Bain did not appeal the district court's grant of summary judgment against her.

On October 4, 2010, Bain moved for relief from judgment based on “newly discovered evidence,” pursuant to Rule 60(b)(2). The “newly discovered” evidence cited in support of the motion was an April 24, 2008, letter faxed from Jackson to Bain. The letter stated:

I have never terminated your services nor did I null and void any of your Agreements. I know nothing about a release form. I neither authorized or signed the same. Therefore, I am authorizing you to continue to communicate with Mr. Yakoob regarding the Sultan's property in Las Vegas, and to continue your role as my General Manager and President/COO of The Michael Jackson Company.

J.A. 414.

In an accompanying affidavit, Bain explained that she had received the letter “in connection with the work Mr. Jackson expected me to continue to perform on his behalf.” Bain Aff. ¶ 4. Bain now says that the letter referenced “the Sultan's property” because, at the time, Jackson had been searching for a permanent residence and had expressed interest in a property owned by the Sultan of Brunei. When Jackson inquired about the property in early 2008, Bain raised the issue of the Release. Jackson responded with the April 2008 letter.

According to Bain's affidavit, an unnamed consultant who worked for the Michael Jackson Company had taken a collection of files from Bain's office, and those files included the April 24, 2008, letter. The consultant had been handling real estate matters for Jackson. When the consultant completed his responsibilities in 2008, he “boxed up the information regarding properties and took that information home with him, including the file on the Sultan of Brunei's property,” which contained the April letter. Bain Aff. ¶ 4. The consultant returned the box of files to Bain in “late June, or early July, 2010,” after Jackson's death, and after the district court's entry of summary judgment. Id.

Bain stated that she “did not know the April 24, 2008, letter was in this box, or that it was in the Sultan of Brunei's file,” and she did not examine the contents of the box until late August 2010. Id. ¶ 5. When she opened the Sultan's file, she discovered the letter, which “had been misfiled... in a file labeled, ‘The Sultan of Brunei Finance.’ ” Id. She further stated:

Not in my wildest imagination did I suspect that a box containing documents relating to real properties would contain any material relating to my relationship or employment with Mr. Jackson before this Court. I knew I had correspondence from Mr. Jackson, but I could not find it. I made a diligent search of all the records and files in my office. I did not know, nor was I able to look in the Sultan of Brunei's file, which was in the possession of the consultant. I looked for this file for months, spending many, many hours looking into all of the files which were in my office, but it was no where [sic] to be found.

Id.

On June 7, 2012, the district court denied Bain's Rule 60(b)(2) motion. Bain v. Jackson, No. 09–826, Mem. Op. & Order (D.D.C. June 7, 2012). The court based its denial on two independent grounds. First, the court held that, because Bain knew about Jackson's April 2008 letter at the time of trial, the letter could not be considered “newly discovered” evidence within the meaning of Rule 60(b)(2). Id. at 4. Second, the court held that Bain failed to exercise “due diligence” in attempting to discover the letter. Id. at 4–5. The court explained that Bain made no reference to the letter in any filings, and thus “cannot be said to have conducted due diligence in attempting to procure it.” Id. at 5.

II.

Federal Rule of Civil Procedure 60(b) sets forth various grounds upon which a party may obtain relief from a judgment. Rule 60(b)(2) allows for relief based on “newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial.” Fed.R.Civ.P. 60(b)(2). A district court considering a motion for relief from judgment under Rule 60(b) must “strike a ‘delicate balance between the sanctity of final judgments ... and the incessant command of a court's conscience that justice be done in light of all the facts.’ ” Twelve John Does v. District of Columbia, 841 F.2d 1133, 1138 (D.C.Cir.1988) (alteration in original) (quoting Good Luck Nursing Home, Inc. v. Harris, 636 F.2d 572, 577 (D.C.Cir.1980)) (some internal quotation marks omitted). The trial judge, “who is...