927 F.3d 912
5th Cir.2019Background
- John and Bettie Priester sued to avoid a Texas home-equity lien; their suit was dismissed and this court affirmed in 2013, relying on a four-year statute of limitations (Priester v. JP Morgan Chase Bank, N.A.).
- In 2016 the Texas Supreme Court held that no statute of limitations applies to actions to quiet title on invalid home-equity liens (Wood v. HSBC Bank USA, N.A.), which contradicted this court’s earlier Erie prediction.
- The Priesters moved under Federal Rule of Civil Procedure 60(b)(6) to vacate the final judgment based on Wood, arguing the change in Texas law justified relief from the prior federal judgment.
- The district court denied the Rule 60(b)(6) motion; the Priesters appealed and this court reviews for abuse of discretion.
- The panel affirmed: it found the Priesters’ motion untimely (15 months after Wood) and held that a change in decisional law, standing alone, does not ordinarily constitute the extraordinary circumstances required for relief under Rule 60(b)(6).
- The court emphasized finality and noted res judicata (the bank’s foreclosure order) is the normal consequence of a final judgment, not an extraordinary circumstance to reopen it.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a post-judgment change in state decisional law (Wood) justifies relief from a final federal judgment under Rule 60(b)(6) | Wood shows prior Erie prediction was wrong; that change justifies vacatur under Rule 60(b)(6) | A change in decisional law does not, by itself, constitute the "extraordinary circumstances" required for Rule 60(b)(6); finality weighs against reopening | Held: No—change in law alone is insufficient; Rule 60(b)(6) relief denied |
| Whether the Priesters’ motion was timely under Rule 60(c) | Motion was reasonable despite filing 15 months after Wood | Motion was untimely; 15-month delay was unreasonable | Held: District court did not abuse discretion in finding the motion untimely |
| Whether res judicata or subsequent foreclosure created an extraordinary circumstance warranting relief | The foreclosure and potential preclusive effect of the federal judgment make relief necessary to avoid injustice | Res judicata is the ordinary effect of a final judgment and does not constitute extraordinary circumstances | Held: Res judicata/foreclosure does not transform change in law into extraordinary circumstances |
| Whether prior panel grants of Rule 59(e) relief after intervening law affect Rule 60(b)(6) analysis | Alexander’s Rule 59(e) grant shows openness to postjudgment relief when law changes | Rule 59(e) is different: timelier and subject to different standards than Rule 60(b)(6) | Held: Rule 59(e) decisions are not precedent for Rule 60(b)(6); distinction upheld |
Key Cases Cited
- Priester v. JP Morgan Chase Bank, N.A., 708 F.3d 667 (5th Cir. 2013) (original panel decision applying a four-year limitations rule)
- Wood v. HSBC Bank USA, N.A., 505 S.W.3d 542 (Tex. 2016) (Texas Supreme Court holding no statute of limitations applies to quiet-title actions on invalid home-equity liens)
- Alexander v. Wells Fargo Bank, N.A., 867 F.3d 593 (5th Cir. 2017) (panel granted Rule 59(e) relief based on Wood)
- U.S. ex rel. Garibaldi v. Orleans Parish Sch. Bd., 397 F.3d 334 (5th Cir. 2005) (Rule 60(b) ‘‘extraordinary circumstances’’ standard)
- Batts v. Tow-Motor Forklift Co., 66 F.3d 743 (5th Cir. 1995) (change in decisional law ordinarily not extraordinary under Rule 60(b))
- Seven Elves, Inc. v. Eskenazi, 635 F.2d 396 (5th Cir. 1981) (emphasis on finality of judgments)
- Lavespere v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167 (5th Cir. 1990) (distinguishing Rule 59(e) and Rule 60(b) standards)
- Demahy v. Schwarz Pharma, Inc., 702 F.3d 177 (5th Cir. 2012) (amending judgment under Rule 59(e) for intervening change in controlling law)