United States v. Estate of Stonehill
2011 U.S. App. LEXIS 19709
| 9th Cir. | 2011Background
- Stonehill and Brooks challenge a 1967 federal tax judgment by filing a Rule 60(b) motion to vacate, alleging government fraud on the court uncovered via FOIA.
- FOIA-discovered evidence suggests some government misconduct in the suppression hearing, but not enough to show fraud on the court.
- Taxpayers contend the government’s use of Saunders as an informant violated Throckmorton grounds for vacatur.
- District court denied the motion; on remand, the Ninth Circuit affirmed that the district court acted within its discretion.
- The key issues concern whether fraud on the court occurred and whether Saunders informs the Throckmorton basis for vacatur.
- The court holds that the government did not commit fraud on the court and rejects the Throckmorton claim, affirming denial of vacatur.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the government committed fraud on the court | Stonehill argues government hid Picture Folder evidence | United States maintains no scheme to defraud | No fraud on the court established |
| Impact of the Picture Folder and Powers Memorandum | Full Picture Book and notes were concealed to mislead | Record did not show material impact on suppression ruling | Concealment did not alter outcome; no basis for vacatur |
| Throckmorton claim regarding Saunders | Saunders acted as informant while allegedly attorney | No clear attorney-client relation at relevant times | Throckmorton claim rejected |
| Standard of review for abuse of discretion vs de novo review | Review should be de novo due to fraud | Abuse of discretion governs; standard met | Either standard yields denial of vacatur. |
Key Cases Cited
- Chambers v. NASCO, Inc., 501 U.S. 32 (1991) (equity power to vacate judgments for fraud on the court; clear and convincing standard)
- Hazel-Atlas Glass Co. v. Hartford-Empire Co., 322 U.S. 238 (1944) (fraud on the court involves serious misconduct affecting judicial integrity)
- United States v. Throckmorton, 98 U.S. 61 (1878) (threat of renewed action where attorney acted without authority)
- In re Levander, 180 F.3d 1114 (1999) (fraud on the court requires misuse of judicial process; not all misrepresentations qualify)
- Pumphrey v. K.W. Thompson Tool Co., 62 F.3d 1128 (1995) (vacatur for fraud on the court where critical evidence was misrepresented)
- Alexander v. Robertson, 882 F.2d 421 (1989) (fraud-on-the-court standard guiding Ninth Circuit inquiry)