Timothy C. PIGFORD et al., Appellants v. Mike JOHANNS, Secretary, The United States Department of Agriculture, Appellee Cecil Brewington et al., Appellants v. Mike Johanns, Secretary, The United States Department of Agriculture, Appellee.
Nos. 04-5171, 04-5172.
United States Court of Appeals, District of Columbia Circuit.
Argued March 14, 2005. Decided July 15, 2005.
Taxes and employment seem no better a fit. Consider another form of net maximization of a resource, oil-and-gas unitization. Unitization aims at preventing overexploitation of the oil or gas field, i.e., exploitation that reduces the field‘s net value. Among the methods employed is limiting the number of wells; at some point the reductions in output at other wells exceed the costs of an extra well, just as the congestion costs of an extra boat (or cow!) at some point exceed its benefits. Suppose the Commission were in charge of managing oil and gas pooling and unitization, and it found that optimal exploitation of a field called for 20 wells. But then it approved the addition of another 10 because their construction and operation would generate local taxes and employment. Could the employment and taxes drawn to the locality (and presumably away from another locality, as the money spent on the extra wells would have had multiplier effects in its alternative uses) qualify as “development” under the guiding statutes? Again, the answer is not obviously affirmative.
Petitioners, however, failed to question whether the Commission had authority to invoke tourism, employment and tax revenues as offsetting values, or even to argue that reliance on supposed increases in the three was arbitrary or capricious in this context. I therefore join in the opinion of the court.
Alexander J. Pires, Jr. argued the cause for the appellants.
Howard S. Scher, Attorney, United States Department of Justice, argued the cause for the appellee. Peter D. Keisler, Assistant Attorney General, United States Department of Justice, Kenneth L. Wainstein, United States Attorney, and Robert M. Loeb, Attorney, United States Department of Justice, were on brief.
Opinion for the court filed by Circuit Judge KAREN LECRAFT HENDERSON.
Separate opinion concurring in part and dissenting in part filed by Circuit Judge ROGERS.
KAREN LECRAFT HENDERSON, Circuit Judge.
This appeal arises from a longstanding discrimination action by black farmers against the United States Department of Agriculture (Department) alleging racial discrimination in the administration of federally-funded credit and benefit programs. The appellants are farmers whose discrimination claims were denied in adjudications conducted pursuant to a Consent Decree and whose petitions for review of the adverse adjudications were rejected as untimely because they were filed after the stipulated deadlines that the parties negotiated and the court approved in a Stipulation and Order (S & O). The appellants challenge the district court‘s denial of their motions for relief from the stipulated deadlines under
I.
In 1997 a class of black farmers filed this action in the district court alleging racial discrimination in violation of the Equal Credit Opportunity Act,
which established a two-track system for resolving the individual class members’ claims. Pigford v. Glickman, 185 F.R.D. 82 (D.D.C.1999), affirmed, 206 F.3d 1212 (D.C.Cir.2000). Under Track A, a class member with little or no documentary evidence could submit his claim to an adjudicator and obtain payment of $50,000 and forgiveness of debt owed the Department if he proved discrimination by substantial evidence. Such a claimant “has a fairly low burden of proof but his recovery is limited.” Id. at 96. Track B, by contrast, set no dollar cap on a claimant‘s recovery but the claimant must prove discrimination by a preponderance of the evidence, “a higher burden of proof.” Id. A claimant in either track could file a petition for review of an adverse decision by the adjudicator with an independent monitor who “shall direct the adjudicator to reexamine the claim if he determines that ‘a clear and manifest error has occurred’ that is ‘likely to result in a fundamental miscarriage of justice.‘” Id. at 97 (quoting Consent Decree ¶ 12(b)(iii), at 21).
Because the Consent Decree provided no timetable for seeking review by the monitor, the parties negotiated filing deadlines which are set out in the S & O entered by the district court on July 14, 2000. Under the S & O any claimant who had received an adverse adjudicator decision as of the date of the S & O had 120 days from that date (i.e., by November 13, 2000) to file a petition with the monitor. Any claimant who received an adverse decision after the S & O‘s date had 120 days from the date of the adjudication to file a petition. The S & O expressly recites:
“No extensions of these deadlines will be granted for any reason.” Id.
On October 31, 2000 the claimants’ class counsel filed a motion seeking to “redesign” the “unworkable” petition filing process, noting that as of that date counsel had filed petitions on behalf of only 297 of the 3,873 claimants requesting filing assistance. Pls.’ Mot. for Expedited Hearing at 7, 3-4 (filed Oct. 31, 2000). Following a conference with the parties the district court issued an order on November 8, 2000 directing that, in lieu of a completed petition for each of the claimants, counsel could satisfy the November 13, 2000 deadline by submitting a “Register of Petitions” (Register) which simply listed the name and claim number of each claimant who had sought counsel‘s assistance in filing a petition for review of an adverse decision issued as of the S & O date. Pigford v. Glickman, C.A. Nos. 97-1978, 98-1693, 2000 WL 34292618 (D.D.C. filed Nov. 8, 2000). The court explained that, while “counsel should be held to the commitments to which they agreed,” nonetheless “counsel‘s failings should not be visited on their clients.” Id. at 3, 4, 2000 WL 34292618, at *1. The court further directed that class counsel file 400 of the Register‘s petitions by December 15, 2000 and another 400 by the 15th of each month thereafter up to a final filing date of May 15, 2001. The order recited: “Under no circumstances shall the Monitor accept supporting materials or withdrawals after May 15, 2001.” Id. at 5, 2000 WL 34292618, at *3. In effect, the court doubled the stipulated time to file a petition for review of an adjudication decided as of the date of the S & O.
On March 15, 2001 the appellants filed a motion for an order suspending the May 15, 2001 deadline. The district court held a status conference and on April 27, 2001 issued an order directing “that all deadlines set forth in the Court‘s Order of November 8, 2000, are suspended until further order of the Court” pending a scheduled meeting on May 1, 2001 between class counsel and outside lawyers “who might be able to assemble a team of pro bono lawyers to assist class counsel on an emergency basis.” Pigford v. Veneman, 144 F.Supp.2d 16, 20 (D.D.C.2001). In addition, the court ordered that if, after the May 1 meeting, class counsel decided additional time was necessary they should file a motion for extension no later than May 4, 2001 setting out a “realistic” filing schedule.
After the pro bono meeting the appellants proposed extending the filing deadline to September 15, 2001 and the district court so ordered on May 15, 2001, finding the new deadline “both realistic and reasonable” in light of the “impressive commitment made by pro bono counsel to assist Class Counsel.” Pigford v. Veneman, 143 F.Supp.2d 28, 30 (D.D.C.2001). The May 15, 2001 order warned that “[u]nder no circumstances ... shall the Monitor accept supporting materials or withdrawals that are filed after September 15, 2001.” Id. at 31. Class counsel, with pro bono assistance, succeeded in filling all of the remaining petitions by the new deadline.
On July 19, 2002 class counsel filed a motion seeking relief under
The appellants comprise two groups of late-filing claimants: (1) those represented by class counsel, now numbering 92, and some 208 others who either proceeded pro se or were represented by lawyers unaffiliated with class counsel. Class counsel argues on behalf of each group that the district court erred in denying relief from the filing deadlines under either Rule 60(b)(5) or its inherent equitable power. We review the district court‘s decision whether to modify a consent order, either under
A. Class Counsel Petitions
The district court denied the appellants’ motion for relief as to the 92 petitions filed late by class counsel because the appellants failed to demonstrate “changed circumstances” to warrant modifying the S & O schedule under Rule 60(b)(5), which provides in relevant part: “On motion and upon such terms as are just, the court may relieve a party or a party‘s legal representative from a final judgment, order, or proceeding for the following reasons: ... (5) ... it is no longer equitable that the judgment should have prospective application ....” The appellants challenge the district court‘s Rule 60(b)(5) decision on two grounds. We address each in turn.
First, the appellants assert the district court incorrectly invoked Rule 60(b)(5) because the rule governs only orders that are final.2 The appellants contend that the S & O was not a final order and that therefore the court should have decided whether to grant relief solely under its inherent equitable authority. See Envtl. Defense Fund, Inc. v. Costle, 636 F.2d 1229, 1240 (D.C.Cir.1980) (“The power of a District Court sitting as a court of equity to modify the terms of a settlement agreement it previously adopted cannot be drawn into question.“). As a practical matter, it makes little difference whether the district court resolved the motion under Rule 60 or under its equitable authority as the standard for each is substantially the same. Compare Rufo v. Inmates of Suffolk County Jail, 502 U.S. 367, 393, 112 S.Ct. 748, 116 L.Ed.2d 867 (1992) (under Rule 60(b)(5), “a party seeking modification of a consent decree must establish that a significant change in facts or law warrants revision of the decree and that the proposed modification is suitably tailored to the changed circumstance“), with Envtl. Defense Fund, Inc., 636 F.2d at 1240 (“[S]ound exercise of judicial discretion may require that terms of a consent decree be modified when there has been a significant change in the circumstances obtaining at the time the consent decree was entered.“). Nonetheless, we conclude that the court correctly invoked Rule 60(b)(5).
Next, the appellants contend that even if the S & O is a final order subject to Rule 60(b), the district court abused its discretion in failing to modify the S & O for changed circumstances. Again we disagree.
In the June 2, 2003 order denying the appellants’ motion for relief, the district court rejected their contention that “the large volume of claimants requesting assistance with petitions during a short period of time” constituted a changed circumstance because it “occurred before, not after, the relevant deadlines were agreed to by the parties and endorsed by the Court.” 265 F.Supp.2d at 46 (emphasis by court). The court explained: “The exponential increase in claimants was fully apparent when plaintiffs and defendant negotiated and agreed to the July 14, 2000 Stipulation and Order, including its clear provision that ‘no extensions of these deadlines will be granted for any reason.‘” Id. at 46 (quoting S & O ¶ 5, at 4). The appellants do not quibble with the court‘s analysis, see Appellants’ Br. at 22, but contend the court abused its discretion by failing to grant relief based on four other changed
To the extent the four new circumstances adversely affected the petition filing process, the court had already taken them into account and provided the appellants with relief. In response to class counsel‘s October 31, 2000 plea of an unexpectedly high volume of meritorious review petitions, the court modified the S & O on November 8 to permit class counsel to satisfy the November 13, 2000 filing deadline through the simple Register listing, a remedy the appellants accepted without complaint.4 When class counsel sought relief in spring 2001 because of their depleted resources, both financial and human,5 the court granted a four-month extension until September 15, 2001, by which deadline all of the remaining petitions were filed. Given the district court‘s repeated accommodation of class counsel‘s continuing delinquency, we cannot say the court abused its discretion in denying the appellants’ motion for further relief.6
Second, the dissent asserts the district court erred as a matter of law by failing to consider whether class counsel‘s failures to meet the deadlines amounted to an “unforeseen obstacle warranting relief.” Dissent at 27. The dissent relies on the court‘s decision in Pigford v. Veneman, 292 F.3d 918 (D.C.Cir.2002) (Pigford I), for the proposition that “where class members lack competent counsel, counsel‘s failure to meet deadlines itself may amount to an ‘unforeseen obstacle’ that makes the decree ‘unworkable.‘” Dissent at 25 (quoting Pigford I, 292 F.3d at 925). Pigford I, however, presented a different situation in two respects. First, contrary to the dissent‘s characterization, Pigford I did not present “the same issue of modification of deadlines” as here, Dissent at 26 (emphasis by dissent), so as to implicate law of the case. In Pigford I the court modified the consent order to permit arbitrators to extend the deadlines for filing evidentiary materials in Track B litigation, set out in paragraph 10 of the Consent Decree, based on class counsel‘s “malpractice” in the Track B litigation, namely, “its inability to represent all Track B claimants
B. Pro Se and Unaffiliated Counsel Petitions
Next, the appellants contend the district court abused its discretion in denying relief under its inherent equitable authority to the late filing claimants who were not represented by class counsel and did not, class counsel contends, receive actual notice of the S & O deadlines.9 In their motion for relief the appellants cited lack of notice as a “changed circumstance” supporting modification of the S & O under either Rule 60(b)(5) or the court‘s inherent authority because “Track A decision letters issued after July 14, 2000 mistakenly omitted language informing claimants that they had 120 days from the date of the decision to petition the Monitor for review.” Pls.’ Mem. in Supp. of Mot. for Relief at 13-14. The district court rejected this argument because the S & O did not require the letters to include such notice and therefore its absence was not a changed circumstance.10
On reconsideration, the appellants took a different tack, arguing that when class members “do not receive actual notice of a deadline by which they must take some action to preserve their claims, and therefore miss the deadline, the District Court may ‘exercise its equitable authority to excuse the late filings.‘” Pls.’ Reply to Def.‘s Resp. to Mot. for Recons. at 11-12 (quoting In re Orthopedic Bone Screw Prods. Liability Litig., 246 F.3d 315, 320 (3d Cir.2001) (alteration original)). The appellants further urged the court to apply the “excusable neglect” standard in exercising its inherent authority as well as the four factors the Third Circuit adopted under the standard in Orthopedic, namely: 1) the danger of prejudice to the non-movant; 2) the length of the delay and its potential effect on judicial proceedings; 3) the reason for the delay, including whether it was within the reasonable control of the movant; and 4) whether the movant acted in good faith. 246 F.3d at 322-23 (citing Pioneer Inv. Servs. v. Brunswick Assocs. Ltd. P‘ship, 507 U.S. 380, 395, 113 S.Ct. 1489, 123 L.Ed.2d 74 (1993)). The district court applied the Third Circuit‘s formulation and under the first and third factors found no excusable neglect warranting equitable relief because of the potential prejudice to the Department and the appellants’ role in drafting the S & O. The court concluded (1) that the government “‘will “be prejudiced to the tune of almost one million dollars” if the Court permits consideration of the late petitions and if even five percent of them are successful,‘” 307 F.Supp.2d at 50 (quoting Pigford v. Veneman, 265 F.Supp.2d at 50), and (2) “because the deadlines were negotiated and agreed to by plaintiffs, it logically follows that the resulting failure to meet those deadlines had been within the reasonable control of plaintiffs,” id. at 50-51. In so concluding the court did not abuse its discretion. As the district court pointed out in the May 27, 2001 order suspending the deadlines: “As part of the bargain struck between the parties and approved by the Court in the Order of July 14, 2000, class counsel agreed to meet the 120 day deadline in return for the government‘s agreement to admit more than 1,100 Track A claimants into the class who otherwise would have been excluded.” 144 F.Supp.2d at 19 n. 2. If the district court had granted the requested relief from the deadlines, the government would have lost the benefit of its bargain—certainty and finality as to its maximum liability as of the agreed upon date—while the claimant class would have recovered the bargained-away right to compensation for claimants filing review petitions beyond the stipulated deadlines (as extended by the court).11 The prejudice to the government
For the foregoing reasons, the district court‘s orders denying the appellants’ motions are affirmed.
So ordered.
ROGERS, Circuit Judge, concurring in part and dissenting in part.
The history of this litigation bears witness to the many obstacles to relief for the class of African American farmers covered by a consent decree based on their allegations of unlawful racial discrimination by the United States Department of Agriculture in administering its farm loan programs. The task has not been easy for a number of reasons, including the complications necessarily associated with ensuring relief to eligible class members and the deficiencies of class counsel, as determined by the district court. While the district court‘s efforts so far have ensured that only a small portion of the class will not have their claims for Monitor review considered, as a result of the court‘s decision today, the claims of 305 class members are unduly extinguished: 97 farmers will lose the opportunity to have independent administrative review of their claims by a Monitor in accordance with the claims procedure in the consent decree, and 208 farmers (170 without counsel), who may not have received notice of the filing deadlines, will lose their opportunity to pursue their claims at all.
In denying appellants’ motion of July 19, 2002 for relief for these 305 class members, and the motions for reconsideration of June 13 & 16, 2003, the district court clearly erred in relying on a finding of fact regarding the increased claims workload, and erred, alternatively, as a matter of law by failing to consider, in accordance with Pigford v. Veneman, 292 F.3d 918 (D.C.Cir.2002) (”Pigford I“), whether class counsel‘s untimely filings was a changed circumstance within the meaning of Federal Rule of Civil Procedure 60(b)(5). It also erred by failing to inquire whether 208 claimants’ late filings were due to the inadequacy of the notice procedures before determining whether to deny any relief under Federal Rule of Civil Procedure 6(b). Accordingly, while I concur in the holding that the July 14, 2000 Order establishing the original filing deadlines was a final appealable order, see Op. at 17, I would reverse and remand the case to the district court to determine whether the filing deadlines were “unworkable,” and thus warranting relief for 97 class members pursuant to Rule 60(b)(5), and to determine whether 208 class members failed to receive notice of the filing deadlines as a result of inadequate notice procedures and were entitled to relief under Rule 6(b).
I.
The question on appeal is whether the district court abused its discretion in deny-
Rule 60(b)(5) provides, in relevant part, that “the court may relieve a party ... from a final judgment, order or proceeding [if] ... it is no longer equitable that the judgment should have prospective application.”
Ordinarily ... modification should not be granted where a party relies upon events that actually were anticipated at the time it entered into a decree. [citations omitted] If it is clear that a party anticipated changing conditions that would make performance of the decree more onerous but nevertheless agreed to the decree, that party would have to satisfy a heavy burden to convince a court that it agreed to the decree in good faith, made a reasonable effort to comply with the decree, and should be relieved of the undertaking under Rule 60(b).
Id. In Pigford I, the court held that changed circumstances may include “unforeseen obstacles” that make an order “unworkable.” Pigford I, 292 F.3d at 925; see Rufo, 502 U.S. at 384, 112 S.Ct. 748.
The district court found that the large increase in the number of claimants occurred before the deadlines in the July 14th Order were agreed to, and therefore did not amount to unanticipated “changed circumstances” rendering the deadlines “unworkable” within the meaning of Rule 60(b)(5). See Pigford v. Veneman, 265 F.Supp.2d 41, 47 (D.D.C.2003), reconsideration denied, Pigford v. Veneman, 307 F.Supp.2d 43 (D.D.C.2004). In so finding the district court, as does the court today, Op. at 19-20, ignored the key distinction argued by appellants in their motion for reconsideration and supported by evidence in the record. Appellants pointed out that the critical “changed circumstance” was not the vastly greater number of total claimants, but the unanticipated large number of claimants seeking Monitor review because their claims likely had been denied erroneously in the first instance by the adjudicator, and had potentially meritorious grounds for seeking Monitor review. Appellants explained that class counsel originally had anticipated that the vast majority of would-be seekers of Monitor review would not meet the high standards for such review set forth in the consent decree—“clear and manifest error” that is “likely to result in a fundamental miscarriage of justice,” Consent Decree ¶ 12(b)(iii)—and therefore, at the time they agreed to the July 14th Order deadlines, had estimated that only approximately 2,500 petitions would require processing for Monitor review. However, class counsel subsequently discovered that a much higher number of the claims rejected by the adjudicator were potentially meritorious claims even under the high standard for Monitor review. In fact, the total vol-
In support of this distinction, appellants pointed to the high success rates of claims upon Monitor review: The facilitator‘s report cited by appellants indicated that approximately 48% of the claimants who had filed for review with the assistance of counsel had been approved by the Monitor for reexamination by the adjudicator, and 100% of reexamined petitions prevailed on the merits. This statistical evidence substantiated class counsel‘s argument that many meritorious claims had been erroneously denied by the adjudicator, necessitating the filing of petitions for Monitor review and creating more work for class counsel than was anticipated when the July 14th Order deadlines were agreed to.
The record further indicates that the number of class members seeking Monitor review was unanticipated by either party or by the district court when the parties agreed to those deadlines. As noted, when the district court established the Register of Petitions process in the November 11, 2000 Order, class counsel was estimating a total of 2,500 petitions for Monitor review. The district court relied on this estimate to set the filing schedule for fully supported petitions. The November 11th Order further indicated that the higher volume of petitions for Monitor review was not anticipated, for the district court acknowledged that neither the Department nor the Monitor were prepared to handle and process the higher volume of petitions. The court stated:
It is obvious that if Class Counsel, Of Counsel and all unaffiliated counsel were forced to file thousands of fully supported Petitions by November 13, the government would be unable to respond to them in a meaningful way within the 60 days that it has to file a response. [citation omitted] Furthermore, the Monitor informed the Court at the hearing that even if the government had the resources to complete such a task, the Monitor initially will be unable to decide the Petitions at a pace greater than 200 to 300 each month.
Indeed, the district court later acknowledged at the April 19, 2001 status conference that “some of the failings of the lawyers, if we want to call them that, are simply because people were overworked. There was much more to be done than people thought.” (emphasis added).
In light of the record evidence that the high number of class members seeking Monitor review was unanticipated at the time the July 14th Order deadlines were agreed to, the district court clearly erred in relying on its finding in its opinion of June 2, 2003 that the “critical ‘changed circumstance‘” had “occurred before, not after, the relevant deadlines were agreed to,” in denying appellants’ motion for reconsideration in its opinion of March 19, 2004, Pigford, 307 F.Supp.2d at 48, without distinguishing between the overall number of claimants and the number of petitions for Monitor review. Instead, the district court denied reconsideration stating that, notwithstanding appellants’ “further elaboration,” “the [c]ourt declines to revisit its determination that the asserted ‘changed circumstances’ presented by [appellants] do not justify modification of the [c]ourt‘s prior orders under Rule 60(b)(5).” Id. While the court states that the district court established the Register procedure to provide relief from the increased volume of meritorious petitions, Op. at 19, that relief created filing problems of its own and, in any event, the district court underestimated the volume of Monitor-review petitions even then.
Moreover, in denying appellants’ motions, the district court failed to consider the instruction of Pigford I that where class members lack competent counsel, counsel‘s failure to meet deadlines itself may amount to an “unforeseen obstacle” that makes the decree “unworkable” under Rule 60(b)(5). Pigford I, 292 F.3d at 925. In Pigford I, this court embraced the concept that the district court has a duty to protect class members where such members did not choose their counsel and where retention of other lawyers is unlikely, 292 F.3d at 926-27, a concept embraced by other circuits as well.1 Noting that the consent “decree‘s express purpose is to ‘ensur[e] that in their dealings with [the Department], all class members receive full and fair treatment,’ Consent Decree at 2, and its ‘main accomplishment was the establishment of a process to adjudicate individual claims,‘” this court distinguished between the failings of class counsel and the opportunity of class members to avail themselves of the remedial scheme under the consent decree: The court opined that there was “no basis for holding [the class members] responsible for [counsel‘s] failure” to meet deadlines which had been bargained for by the parties, Pigford I, 292 F.3d at 927, and held that relief was appropriate under Rule 60(b)(5) because “class counsel‘s failure to meet critical Track B deadlines amounts to an ‘unforeseen obstacle’ that makes the decree ‘unworkable,‘” id. at 927 (quoting Rufo, 502 U.S. at 384, 112 S.Ct. 748).
This conclusion in Pigford I is no less applicable now than it was then, for “[t]o hold otherwise would sanction the farmers’ double betrayal: first by the Department ... and then by their own lawyers.” Id. In granting an extension of Track B deadlines missed due to attorney error, the district court had previously acknowledged that the general rule that attorney error is not excusable should not apply here, where “[t]he history of this case is unique ... and requires more than hasty application of general practice.” Pigford v. Veneman, 182 F.Supp.2d 50, 52 (D.D.C.2002). This court observed in Pigford I that,
[T]he decree itself assumes competent representation for the farmers. The decree‘s express purpose is to “ensur[e] that in their dealings with [the Department], all class members receive full and fair treatment,” ... and its “main accomplishment was the establishment of a process to adjudicate individual claims.” ... Unless the farmers have competent counsel, we cannot imagine how they could ever obtain “full and fair treatment” in a claims process where ... missing a single deadline could be fatal.
292 F.3d at 927 (quoting Consent Decree, at 2; Pigford v. Glickman, No. 97cv01978 (D.D.C. Mar. 8, 2001)). Not only has the district court found class counsel‘s performance sanctionable and imposed severe monetary fines on them, Pigford v. Veneman, 307 F.Supp.2d 51 (D.D.C.2004), but at a time when there was, as the district court stated, “much more to be done than people thought,” and the critical filing deadlines were drawing near, class counsel
had an impact on the number of lawyers and the amount of time that those lawyers are spending on the Monitor petition process.... if you have to succeed or prevail to get paid, then getting new lawyers in the act would be hard, and I understand that it is also having an impact on the existing lawyers. [Class counsel] has cut back on [its] staff.
(emphasis added).
Today, by affirming the denial of appellants’ motions, the court ignores our analysis in Pigford I and the duty of the trial judge to protect class members who do not chose their own counsel when unanticipated circumstances have created “a situation where there were too many cases and too few lawyers.” Br. for Appellants at 22. By declining to account for Pigford I‘s contrary holding as an infringement of the district court‘s discretion, Op. at 20, the court ignores that Pigford I involved the same unique history, the same consent decree, the same class counsel, and the same issue of modification of deadlines missed by class counsel under Federal Rule of Civil Procedure 60(b)(5) considered in the same court, and as such its holding is nearly akin to the law of the case, in addition to being law of the circuit. See LaShawn A. v. Barry, 87 F.3d 1389, 1393, 1395 (D.C.Cir.1996) (en banc). That Pigford I involved claims under Track B rather than Track A does not change the fact that the legal issue before the court is the same: whether appellants are entitled to relief under Rule 60(b)(5) for counsel‘s fail-
Finally, while the Secretary would distinguish Pigford I as concerned with extinguishing a class member‘s claim, see Pigford I, 292 F.3d at 922, from the denial of an opportunity to seek Monitor review, from the perspective of the class member whose claim has been wrongfully denied, the effect is the same: Neither class member will have the opportunity to utilize the remedial process established in the consent decree. Taken together, the circumstances identified in appellants’ motions suggest that the 97 class members should not bear the burden of counsel‘s failures to meet filing deadlines. In order to avoid a “double betrayal” of the class members, the district court was required to separate the failures of counsel from the claims of the class members in order to ensure that the opportunity to pursue the claims process established in the consent decree not be foreclosed. Id. at 927. It did not do so, and the court today fails to explain how the district court fulfilled its responsibilities in accordance with the analysis in Pigford I.
Because the district court, in denying the motion for reconsideration, erroneously relied on its finding in its opinion of June 2, 2003 that the “critical changed circumstance” occurred before the July 14th Order deadlines were agreed to without taking into account record evidence demonstrating that the volume of petitions for Monitor review—the relevant change in circumstance—was not anticipated at the time the deadlines were agreed to, and in the alternative erred as a matter of law by failing to consider whether class counsel‘s failures to meet the deadlines amounted to an “unforeseen obstacle” warranting relief, I would reverse and remand the case to the district court to address whether the deadlines were “unworkable” under Rule 60(b)(5).
II.
Additionally, the district court failed to inquire whether adequate notice was provided to 208 class members, for whom appellants proffered evidence that these class members had not received notice of the filing deadlines for Monitor review, in determining whether relief was warranted under the “excusable neglect” standard of Federal Rule of Civil Procedure 6(b).
The July 14 Order modified the consent decree to limit the period within which class members could seek Monitor review of denied claims and, as the district court noted, it did not provide for individual notice to unsuccessful Track A class mem-
Nonetheless, the district court denied relief under the “excusable neglect” standard of Rule 6(b). Applying the four-factor test of Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P‘ship, 507 U.S. 380, 398-99, 113 S.Ct. 1489, 123 L.Ed.2d 74 (1993), the district court found first, that the government would be “prejudiced to the tune of almost one million dollars” by allowing consideration of late petitions if five percent were successful, and second, that “because the [July 14th Order] deadlines were negotiated and agreed to by the [appellants], it logically follows that the resulting failure to meet those deadlines had been within the reasonable control of [appellants].” Each finding is problematic given the district court‘s duty to ensure that adequate notice procedures were, in fact, established to provide class members with notice of filing deadlines. The district court made no finding that appellants were not proceeding in good faith or that there would be undue delay of the proceedings by granting relief.
The district court‘s finding of “prejudice” to the government is ironic. See Pigford v. Glickman, 185 F.R.D. 82, 95 (D.D.C.1999); see also Pigford I, 292 F.3d at 927. In approving the consent decree, the district court observed that “the settlement is a fair resolution of the claims brought in this case and a good first step towards assuring that the kind of discrimination that has been visited on African American farmers since Reconstruction will not continue into the next century.” Pigford, 185 F.R.D. at 86 (emphasis added). The July 14th Order deadlines were not imposed in order to limit the government‘s liability as such, but rather, according to the district court, to bring closure to the process through fair procedures that would identify the number of class members seeking Monitor review. Moreover, the dollar amount of prejudice claimed by the Secretary represents 0.04% of the estimated settlement, see Pigford, 206 F.3d at 1244, and 0.125% of the amount actual paid out by the government at that time. This court, in turn, mistakenly relies on the Secretary‘s argument that class counsel‘s agreement that the July 14th Order deadlines would not be extended was the quid pro quo for its agreement to admit other Track A claimants into the class who would otherwise have been excluded. See Op. at 21-22; Br. for the Appellee at 24. This is not the analysis adopted by the district court in denying appellants’ motions; instead, the district court addressed that quid pro quo in imposing monetary sanctions on class counsel in a separate order, see Pigford v. Veneman, 144 F.Supp.2d 16, 19 n. 2 (D.D.C.2001), which is not on appeal.
The district court‘s second finding, that the failure to meet the deadlines was within the farmers’ control because they
Whether the prejudice to the government outweighed other considerations could not be determined by the district court until it first determined—in light of the proffered evidence that the agreed-to notice procedures were inadequate for 208 class members—the adequacy of the agreed-to notice procedures, and whether the late filings were the result of inadequate notice. Only then could the district court determine whether the 208 class members were entitled to relief under Rule 6(b). Therefore, I would reverse and remand the case for the district court to determine the adequacy of the notice procedures and whether the 208 class members were entitled to relief. See Pigford I, 292 F.3d at 925-27; In re Orthopedic Bone Screw Prods. Liab. Litig., 246 F.3d at 321-29; Zients, 459 F.2d at 630.
Accordingly, I respectfully dissent from Part II of the court‘s opinion.
POLYGRAM HOLDING, INC., et al., Petitioners v. FEDERAL TRADE COMMISSION, Respondent.
No. 03-1293.
United States Court of Appeals, District of Columbia Circuit.
Argued Sept. 16, 2004. Decided July 22, 2005.
Notes
It is now nearly three years since this case began. During this time the firms incurred crushing expense. For example, [class counsel] Conlon, Frantz incurred substantial obligations—borrowing $1,000,000 simply to remain solvent. Mr. Pires was not paid for over 15 months. He obtained multiple mortgages to pay his personal expenses.... [The Of-counsel law firm of] Chestnut, Sanders was forced by the scope of the litigation to borrow $1 million, hire new employees and cut partner salaries by 60%.On August 4, 2000, the district court, acknowledging “the dire financial straits in which several firms affiliated with class counsel currently find themselves,” ordered an immediate preliminary award to counsel of $7 million, which covered only previously incurred costs and amounted to less than one-half the cumulative loadstar amount of $14,582,703. Although, in response to class counsel‘s motion for an extension of the July 14th Order deadlines, the district court set up the Register of Petitions process in November 2000, counsel still missed filing deadlines. When the parties’ attempt, at the district court‘s suggestion, to resolve their differences regarding counsel‘s May 8th request fees and costs proved unsuccessful, on January 12, 2001 class counsel, of-counsel, and one counsel moved for additional interim fees alleging “significant hardship” as a result of continued financing of implementation of the Consent Decree, without the regular payment of fees, through bank loans to cover staff salaries and expenses. A further payment of interim fees and costs was ordered on March 8, 2001, well after the filing deadlines, and still, because of the government‘s resistence, class counsel did not receive any payment until July 2001, of $14.9 million, see Pigford v. Veneman, 369 F.3d 545 (D.C.Cir.2004); a further payment of $500,000 was ordered on December 2, 2002, Pigford v. Veneman, 239 F.Supp.2d 68, 71 (D.D.C.2003). The delay in approving payment and the delay in actual receipt of interim fees by class counsel are ignored by the court in discussing the district court‘s “repeated accommodation of class counsel‘s continuing delinquency.” Op. at 19.