Starkey Laboratories, Inc. v. U.S.
| Decision Date | 29 June 2001 |
| Docket Number | SLIP OP. 01-80.,Court No. 93-07-00426. |
| Citation | 155 F.Supp.2d 790 |
| Parties | STARKEY LABORATORIES, INC., Plaintiff, v. UNITED STATES, Defendant. |
| Court | U.S. Court of International Trade |
Dorsey & Whitney LLP, Washington, DC (Munford Page Hall, II and Linda B. Popejoy, Esqs.) for plaintiff.
Stuart E. Schiffer, Acting Assistant Attorney General; Joseph I. Liebman, Attorney in Charge, International Trade Field Office, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC (Aimee Lee, Esq.), for defendant.
Plaintiff moves pursuant to CIT Rule 60(b)(6), or alternatively, CIT Rule 60(b)(1),1 to vacate the judgment of dismissal in this action on May 10, 1995 for lack of prosecution entered by the clerk of the court pursuant to CIT Rule 83(c)2 and to reinstate this case to the Reserve Calendar of the court for six months. Defendant opposes plaintiff's motion.
There is no dispute concerning the facts relevant to the current matter before the court.
This tariff classification action was initiated by the filing of a summons on July 30, 1993. At that point in time, plaintiff was represented by Ronald J. Rasley, Esq. ("Rasley"), an experienced lawyer, a member of the Minnesota bar since 1987, and a member of the law firm of Coleman, Hull and van Vliet, located in Edina, Minnesota. According to plaintiff, Court No. 91-02-00132, was another civil action brought by Starkey in which plaintiff was represented by Rasley. Plaintiff posits that Court No. 91-02-00132 involved the same merchandise and classification issue presented by the current matter, and the court's records reflect that Court No. 91-02-00132 had been designated as a test case by order of Judge Thomas Aquilino, Jr. dated June 7, 1993 pursuant to Rule 84(b). Additionally, the order of June 7, 1993 suspended seven other cases under the designated test case, and those cases were thereupon transferred to the suspension file pursuant to Rule 84(d).
According to plaintiff's current legal counsel, Dorsey & Whitney LLP, Washington, D.C., who was retained by Starkey in November 2000, this case was suspendible pursuant to Rule 84 under the designated test case, Court No. 91-02-00132, in which Starkey ultimately prevailed. See Starkey Laboratories, Inc. v. United States, 6 F.Supp.2d 910 (CIT April 10, 1998), motion to vacate judgment denied, 110 F.Supp.2d 945 (CIT June 19, 2000). Mr. Rasley represented Starkey in the test case, obtained a judgment in favor of plaintiff on April 10, 1998, and subsequently, on June 19, 2000, successfully opposed defendant's motion for vacatur of the judgment and for rehearing. See id.
The court is advised by plaintiff that its current counsel is now in the process of negotiating stipulated judgments for refund of duties in the suspended cases. Defendant, however, has taken no position here with respect to entering into a stipulated judgment in any of the suspended cases, or with respect to whether the merits of this case are covered by the decision in the test case. Plaintiff now complains that through its current counsel, it recently discovered Rasley never filed a motion to suspend the current action under the designated test case, and this case was ultimately dismissed on May 10, 1995 for lack of prosecution under Rule 83(c).
Plaintiff's motion under CIT Rule 60(b), therefore, is before the court as a result of the dismissal of this case pursuant to Rule 83(c) for failure to prosecute on May 10, 1995. The dismissal is attributed by plaintiff to the failure of its prior counsel, Rasley, to timely suspend this case under the designated test case, Court No. 91-02-00132, or otherwise timely remove this case from the Reserve Calendar prior to the expiration of the eighteen month time period prescribed by Rule 83(c).
CIT Rule 83(b) specifies several different procedures a party may follow to remove a case from the Reserve Calendar, including suspension under a designated test case pursuant to Rule 84 within the permitted eighteen month time period prescribed by Rule 83(c), and thereby avoid dismissal by the clerk for lack of prosecution. The current case, however, was never suspended under the test case, or otherwise removed from the Reserve Calendar, remained on the court's Reserve Calendar for nearly two years, and as noted above, on May 10, 1995 was dismissed for lack of prosecution. There is no dispute that this action was properly so dismissed pursuant to CIT Rule 83(c).
Plaintiff has submitted in support of its application under Rule 60(b) a recently executed affidavit dated April 12, 2001 by Mr. Rasley relating certain events that occurred as far back as 1993 with respect to this case and the test case. The affidavit apparently is based on the affiant's best recollection, since the affidavit recites that his office has no records for this case. See Rasley Affidavit, par. 6. Rasley's affidavit avers that "[d]uring the course of filing [the test case], the understanding negotiated with the Department of Justice was that any subsequent related cases that were filed with the Court would be suspended until a final decision was reached on the test case." Rasley Affidavit, par. 4. Although it would appear from the foregoing "understanding" that Rasley had at least intended that the current case be suspended under the designated test case (and hence removed from the Reserve Calendar), inexplicably no motion was ever filed by Rasley with the court to suspend the current case. Nonetheless, the affidavit itself contains no explanation or justification whatever as to why Rasley failed to file a motion with the court for suspension, or otherwise take timely action to remove this case from the Reserve Calendar prior to dismissal pursuant to Rule 83(c). In that regard, plaintiff's current counsel simply speculates that prior counsel "most likely" became confused by not having received a notice from the clerk to remove the case from the Reserve Calendar prior to dismissal, which had been the practice of the court prior to the amendment of Rule 83(c), effective January 1, 1993.
Following the entry of the judgment of dismissal on May 10, 1995, Mr. Rasley's firm, Coleman, Hull & van Vliet, relocated its office in June 1995. Rasley avers in his affidavit that at no time did he receive any notices or other communications from the court concerning this case. Sometime after November 2000, through its current counsel plaintiff discovered— more than five years after dismissal— that this case, as well as one other case filed by Rasley (Court No. 94-01-00060),4 had been dismissed by the clerk for failure to prosecute.5 Plaintiff filed this motion to reinstate this case on May 14, 2001, which is of course slightly more than six years from the date of the dismissal for failure to prosecute on May 10, 1995.
Citing Klapprott v. United States, 335 U.S. 601, 69 S.Ct. 384, 93 L.Ed. 1099 (1949) ("Klapprott") and Ackermann v. United States, 340 U.S. 193, 71 S.Ct. 209, 95 L.Ed. 207 (1950) ("Ackermann"), plaintiff relies on the "extraordinary circumstances" test for relief under Rule 60(b)(6), or alternatively, on the inadvertence and excusable neglect of its prior counsel for relief under Rule 60(b)(1). As grounds for relief under Rule 60(b)(6), plaintiff points particularly to its blamelessness for the inaction of its prior counsel, and the lack of notice to remove by the court to its prior counsel before dismissal by the clerk. Citing Carisbrook Industries, Inc. v. United States, 13 CIT 736 (1989), plaintiff further posits the possibility that the circumstances of this case may justify the court in ignoring the one year time limit for a Rule 60(b)(1) motion. Finally, plaintiff urges that reinstatement of the case would not be prejudicial to defendant, but denial of relief will result in a significant financial loss to plaintiff since it prevailed in the test case, and this case could have been suspended under the test case.
Defendant disputes that the facts of this case meet the extraordinary circumstances test required for relief under Rule 60(b)(6), citing Moore's Federal Practice § 60.48[2], § 60.48[3][a] (3d ed.1997), and Marquip, Inc. v. Fosber America, Inc., 198 F.3d 1363, 1370 (Fed.Cir.1999). Defendant further asserts that with respect to plaintiff's claim for relief under Rule 60(b)(6), this case is distinguishable from the myriad of contributing factors warranting relief in G. Heileman Brewing Co., Inc. v. United States, 792 F.Supp. 823 (CIT 1992) ("Heileman"). Defendant further posits that relief under Rule 60(b)(1) is time-barred by the one year time limit under that section; and in any event, neither ignorance nor carelessness on the part of a litigant or his attorney provides grounds for relief under Rule 60(b)(1), citing Avon Products, Inc., supra, Wang Laboratories, Inc. v. United States, 793 F.Supp. 1086 (CIT 1992), and Washington Intern. Ins. Co. v. United States, 793 F.Supp. 1091 (1992). Defendant further maintains that whether or not personally blameless, fundamentally a client bears the consequences of its lawyer's conduct, acts, or omissions, citing Pioneer Investment Services Co. v. Brunswick Associates, 507 U.S. 380, 396, 113 S.Ct. 1489, 123 L.Ed.2d 74 (1993) ("Pioneer"). Finally, defendant claims that it would be prejudiced by reinstatement of a case six years after dismissal.
While under the circumstances of this case the court sympathizes with Starkey's present predicament caused by prior counsel, and appreciates the diligence and efforts of its current counsel in attempting to obtain reinstatement of the case under overwhelmingly adverse circumstances, nonetheless, for the reasons that follow, the court concludes that neither Rule 60(b)(6) nor Rule 60(b)(1) permit vacatur of the judgment and reinstatement of this case.
Relief under Rule 60(b...
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