88 F.4th 353
2d Cir.2023Background
- Plaintiffs Mandala and Barnett received job offers from NTT that were revoked after background checks revealed prior felony convictions; they sued on behalf of a class under Title VII (disparate impact) alleging NTT’s blanket felony-disqualification policy disproportionately harms Black applicants and cited national statistics.
- The district court dismissed the complaint for failure to state a disparate-impact claim, finding the national statistics insufficient to show disparity within NTT’s qualified applicant pool.
- A divided Second Circuit panel affirmed dismissal; a vigorous dissent and contested en banc filings followed, but rehearing en banc was denied.
- After the en banc denial, plaintiffs moved under Fed. R. Civ. P. 60 to vacate the dismissal and for leave to file a first amended complaint; the district court treated the motion as Rule 60(b)(1), denied it as untimely, and alternatively rejected relief under Rule 60(b)(6).
- The Second Circuit majority reversed: it held Rule 60(b)(1) inapplicable, treated the motion under Rule 60(b)(6), found extraordinary circumstances warranting vacatur to permit a first amended complaint, and remanded; Judge Sullivan dissented, arguing the district court acted within its discretion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper Rule for vacatur: 60(b)(1) vs 60(b)(6) | Motion is not a mere mistake/inadvertence; it seeks equitable vacatur to cure pleading defects, so 60(b)(6) applies | Plaintiffs’ motion stems from legal mistake about pleading standards, so 60(b)(1) (one-year limit) governs | 60(b)(1) inapplicable; motion analyzed under 60(b)(6) |
| Whether extraordinary circumstances warrant vacatur to allow first amended complaint | Closed record, contested appellate guidance, and untested pleading burden justify equitable relief to permit repleading | Plaintiffs delayed and had access to relevant public data; they chose litigation strategy (appeal/en banc) instead of amending earlier | Extraordinary circumstances exist here; vacatur warranted to permit first amended complaint |
| Effect of plaintiffs’ litigation choices (appeal and en banc petition) on relief | Choice to appeal/en banc was reasonable given contested law; those actions do not forfeit right to seek post-judgment repleading | Strategic choices and public availability of data show lack of undue hardship and counsel against extraordinary relief | Plaintiffs’ strategy and timing were reasonable given circumstances; not a basis to deny relief |
| Futility / prejudice / other Rule 15 considerations on remand | Plaintiffs seek leave to file first amended complaint addressing the only identified pleading defect; no indication of futility or undue prejudice | Defendant argues amendment is unnecessary or prejudicial; district court worried about finality | Remand to district court to consider leave to amend under Rule 15; no showing of futility or prejudice that justifies denying a first opportunity to replead |
Key Cases Cited
- Stevens v. Miller, 676 F.3d 62 (2d Cir. 2012) (Rule 60(b)(1) and 60(b)(6) are mutually exclusive)
- Klapprott v. United States, 335 U.S. 601 (U.S. 1949) (mistake/inadvertence analyzed under 60(b)(1))
- Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. 847 (U.S. 1988) (Rule 60(b)(6) reserved for extraordinary circumstances)
- Foman v. Davis, 371 U.S. 178 (U.S. 1962) (liberal Rule 15 amendment policy; leave to amend should be freely given absent justifying reasons)
- Williams v. Citigroup Inc., 659 F.3d 208 (2d Cir. 2011) (post-judgment leave to amend requires balancing Rule 15 liberality with finality; denial solely for failure to seek pre-judgment amendment is improper)
- Metzler Inv. GmbH v. Chipotle Mexican Grill, Inc., 970 F.3d 133 (2d Cir. 2020) (abuse-of-discretion standard for post-judgment motions for leave to replead)
- Ruotolo v. City of New York, 514 F.3d 184 (2d Cir. 2008) (vacatur under Rule 60 to allow repleading where justice so requires)
- Mandala v. NTT Data, Inc., 975 F.3d 202 (2d Cir. 2020) (panel decision affirming dismissal; dissent concluded national statistics sufficed at pleading stage)