Summary
acknowledging that "[d]istrict courts have considered the factors and circumstances outlined in [ Bonner Mall] . . . in deciding motions to vacate their decisions," but engaging in a balancing analysis and concluding that "the balance tips in favor of the public interest" and thus against vacatur
Summary of this case from Philip Services Corporation v. City of SeattleOpinion
96-CV-2004 (ILG).
October 31, 2000.
MEMORANDUM AND ORDER
SUMMARY
The United States has filed a motion to vacate this court's memorandum and garnishment order of January 21, 2000 pursuant to Federal Rule of Civil Procedure 60(b)(6). Plaintiff urges the court to vacate the order on the ground that the parties have executed a payment agreement subsequent to the order, or in the alternative, that the court improperly based its order on Green v. Kentucky Higher Educ. Auth., 78 F. Supp.2d 1259 (S.D. Ala. 1999) and 20 U.S.C. § 1095a. For the reasons that follow, plaintiff's motion is denied.
BACKGROUND
Plaintiff commenced this action to collect a student loan debt from defendant. Defendant has proceeded pro se throughout this litigation and has not submitted papers in opposition to plaintiff's motion to vacate. On February 2, 1997, the Clerk of the Court entered a default judgment in favor of plaintiff. Thereafter, plaintiff applied for a writ of garnishment. The defendant was employed by Kingsbrook Jewish Medical Center, the garnishee, which reported the defendant's net bi-weekly salary to be $763.16. The plaintiff requested 25% of that sum, $190.79, to be remitted by the garnishee. The defendant never requested a hearing nor otherwise objected to the writ of garnishment. This court issued an order directing the garnishee to pay a reduced sum equal to 5% of defendant's net disposable weekly income to plaintiff. Familiarity with the underlying facts and order is assumed. See United States v. Reid, No. 96-CV-2004, 2000 WL 264334 (E.D.N.Y. Jan. 21, 2000).
On March 23, 2000, plaintiff filed a timely notice of appeal from the garnishment order. Shortly thereafter, at defendant's request, the parties entered into an agreement obligating defendant to pay plaintiff $100 per month. To date, defendant is in compliance with the agreement. The parties then stipulated to withdraw plaintiff's appeal without prejudice. On June 12, 2000 the Second Circuit "so ordered" the stipulation. Plaintiff now requests the court to vacate its garnishment order because: (1) under the law of U.S. Bancorp Mortgage Co. v. Bonner Mall Partnership, 513 U.S. 18 (1994) and Major League Baseball Properties, Inc. v. Pacific Trading Cards, Inc., 150 F.3d 149 (2d Cir. 1998), exceptional circumstances exist which justify vacatur; or in the alternative (2) the court erroneously applied Green and 20 U.S.C. § 1095a in issuing its garnishment order.
I. Motion to Vacate Standard
Federal Rule of Civil Procedure 60(b)(6), in pertinent part, permits a district court "[to] relieve a party . . . from a final . . . order . . . for the following reasons: . . . (6) any other reason justifying relief from the operation of the judgment." The decision to vacate an order is discretionary and involves a balancing of interests. See Nemaizer v. Baker, 793 F.2d 58, 61-62 (2d Cir. 1986). Thus, a court must weigh "the interests of honoring settlements reached by the parties against the public interest in the finality of judgments and the development of decisional law." Jewelers Vigilance Comm., Inc. v. Vitale Inc., 177 F.R.D. 184, 186 (S.D.N.Y. 1998).
Plaintiff urges this court to follow the teaching of U.S. Bancorp Mortgage Co. v. Bonner Mall Partnership, 513 U.S. 18 (1994), and vacate its garnishment order. In U.S. Bancorp, the Supreme Court examined the federal appellate court power to vacate district court decisions. Id. at 29. In that case, the Supreme Court held that "mootness by reason of settlement does not justify vacatur of a judgment under review." Id. The Supreme Court was careful to note that vacatur may be appropriate under "exceptional circumstances" and that such a determination is an equitable one. Id.
The Second Circuit found "exceptional circumstances" warranting vacatur of the district court order in Major League Baseball Properties, Inc. v. Pacific Trading Cards, Inc. ("MLBP"), 150 F.3d 149 (2d Cir. 1998). There, the plaintiff moved for an injunction pending appeal of an order denying plaintiff's request for a preliminary injunction. Id. at 150. After oral argument, the parties requested the Circuit Court to vacate the district court order so that they could settle their dispute. Id. In fact, the parties agreed that vacatur was a necessary condition of settlement. The following circumstances in MLBP made vacatur of the district court's order appropriate: the defendant-appellee strongly preferred settlement to the spectre of two potentially financially ruinous alternatives that would be raised by an injunction; plaintiff-appellant would subject itself to the trademark law defense of acquiescence without the vacatur; and the only ephemeral public interest damaged by vacatur would be that the validity of plaintiff's marks would be litigated at a future time. Id.
District courts have considered the factors and circumstances outlined in U.S. Bancorp and MLBP in deciding motions to vacate their decisions.See Carter v. Rosenberg Estis, P.C., No. 95 CIV 10439 (DLC), 1999 WL 13036, at *2 (S.D.N.Y. Jan. 13, 1999); Agee v. Paramount Communications, Inc., 932 F. Supp. 85, 87 (S.D.N.Y. 1996). Plaintiff here relies exclusively on U.S. Bancorp and its progeny to support its request for vacatur, a reliance the court finds unpersuasive. Balancing the relevant competing interests, the court is driven to conclude that the balance tips in favor of the public interest.
II. Balancing of Private and Public Interests
A. Private Interests
Courts have recognized litigants' interests in settlement as private interests advanced by vacatur. Looking to the private interests of the litigants, courts have, in certain circumstances, granted a motion to vacate where vacatur was a condition of settlement. See e.g., IBM Credit Corp. v. United Home for Aged Hebrews, 848 F. Supp. 495, 497 (S.D.N Y 1994). Here, it is not contended that vacatur was a condition of settlement.
Plaintiff maintains that it is a "repeat player" in the area of post-judgment garnishment proceedings and that its interest in litigating whether exemptions or defenses apply in a garnishment proceeding might be compromised by this court's order. (Pl. Memo. at 7-8) Disagreement with a published opinion is hardly a justification for eradicating it. The validity of that opinion is best tested, instead, in the "marketplace" of vigorous advocacy. Furthermore, there is no apparent interest of the defendant that would be served by vacatur.
B. Public Interests
In deciding a motion to vacate, a court also must consider the public interest implications of granting it. See Jewelers Vigilance Comm., Inc. v. Vitale Inc., 177 F.R.D. 184, 188 (S.D.N.Y. 1998). The plaintiff fails to advance any reasons why vacating the court's order would serve the public interest. Rather, public interest is furthered by the finality of judgments, the development of decisional law, and by a recognition of the importance of published opinions to other courts and future litigants.See Austin v. Ford, 181 F.R.D. 283, 286 (S.D.N.Y. 1998). The development of decisional law is clearly served by permitting the court's modification of the garnishment order to stand.
III. Vacatur Based on Error of Law
Plaintiff also argues that this court should vacate its garnishment order because the order was improperly based on Green v. Kentucky Higher Educ. Auth., 78 F. Supp.2d 1259 (S.D. Ala. 1999) and 20 U.S.C. § 1095a instead of the Federal Debt Collection Procedures Act of 1990, 20 U.S.C. § 3001-3308. Essentially, plaintiff argues that the court's erroneous application of the law warrants vacatur. That view is best resolved by an appellate court rather than by an order of vacatur. See Schildhaus v. Moe, 335 F.2d 529, 531 (2d Cir. 1964) (permitting Rule 60(b) relief for errors of law by the court on "very special facts" and noting that "`Rule 60(b) was not intended as a substitute for a direct appeal from an erroneous judgment.'") (citation omitted). See also McKnight v. United States Steel Corp., 726 F.2d 333, 337 (7th Cir. 1984) (explaining that a party may not use Rule 60(b) "to correct alleged errors of law by the district court which may have been raised by filing a timely appeal . . .").
CONCLUSION
For the reasons stated above, plaintiff's motion to vacate is denied.
SO ORDERED.