Zachary Lester v. Wow Car Co.
675 F. App'x 588
| 6th Cir. | 2017Background
- In March 2011 Zachary and Brandi Lester bought a used 2001 Toyota from Wow Car Company; the engine failed six days later.
- The Lesters sued Wow, related entities, and the finance company; in a 2013 amended complaint they added a TILA disclosure claim and later sought to add four "New Defendants."
- The district court held TILA claims against the New Defendants time-barred (TILA has a one-year limitations period) and granted summary judgment to defendants; this court affirmed on direct appeal.
- During the appeal some witnesses (Hartzler and Johnson) later recanted portions of earlier testimony; the Lesters moved under Fed. R. Civ. P. 60(b) seeking relief based on equitable tolling, fraud (Rule 60(b)(3)), and relation back (Rule 15(c)).
- The district court denied the Rule 60(b) motion, finding equitable tolling inapplicable, no proven prejudicial fraud/misconduct, and that relation back did not apply to the TILA claims against Hartzler or the New Defendants.
- The Sixth Circuit affirmed, concluding the district court did not abuse its discretion on any ground.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether equitable tolling permits TILA claims against New Defendants | Lesters: new deposition testimony shows defendants misled them, so limitations should be equitably tolled | Defendants: no basis to toll; Lesters had notice and did not meet tolling factors | Court: No abuse of discretion; Andrews factors not met, tolling denied |
| Whether Rule 60(b)(3) relief is warranted for alleged fraud/misconduct | Lesters: defendants engaged in misinformation/coaching that hid proper parties and affected litigation outcome | Defendants: no clear-and-convincing proof of fraud that prejudiced the Lesters | Court: No abuse of discretion; district court found no relevant fraud under Rule 60(b)(3) |
| Whether TILA claim against Hartzler relates back under Rule 15(c) | Lesters: Hartzler knew of the lawsuit and should have been joined; relation back saves claim from limitations | Defendants: Hartzler lacked the requisite notice and knowledge during Rule 4(m) period that she would have been sued but for a mistake | Court: Relation back inapplicable; insufficient evidence Hartzler knew she would be sued; district court applied correct standard |
| Whether TILA claims against New Defendants relate back | Lesters: relation back could allow TILA claims against New Defendants | Defendants: adding new parties does not satisfy Rule 15(c) substitution requirements | Court: Relation back does not apply to newly added parties; claims barred |
Key Cases Cited
- Jones v. TransOhio Sav. Ass'n, 747 F.2d 1037 (6th Cir. 1984) (recognizing TILA is subject to equitable tolling)
- Graham-Humphreys v. Memphis Brooks Museum of Art, Inc., 209 F.3d 552 (6th Cir. 2000) (equitable tolling is sparingly applied)
- Andrews v. Orr, 851 F.2d 146 (6th Cir. 1988) (five-factor equitable tolling framework)
- Truitt v. Cnty. of Wayne, 148 F.3d 644 (6th Cir. 1998) (equitable tolling decided case-by-case)
- McGuire v. Warden, Chillicothe Corr. Inst., 738 F.3d 741 (6th Cir. 2013) (standard: Rule 60(b) denial reviewed for abuse of discretion)
- Jordan v. Paccar, 97 F.3d 1452 (6th Cir. 1996) (Rule 60(b)(3) requires clear-and-convincing proof of misconduct; burden-shifting framework)
- Krupski v. Costa Crociere S.p.A., 560 U.S. 538 (2010) (Rule 15(c)(1)(C)(ii) focuses on prospective defendant's knowledge during Rule 4(m) period)
- In re Kent Holland Die Casting & Plating, Inc., 928 F.2d 1448 (6th Cir. 1991) (adding a new party does not relate back to original filing)