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Devon IT, Inc. v. IBM Corp.

United States District Court, Third Circuit

December 20, 2013

DEVON IT, INC., et al., Plaintiffs,
v.
IBM CORP., et al., Defendants.

OPINION

JOEL H. SLOMSKY, District Judge.

I. INTRODUCTION

On November 21, 2013, this Court issued an Opinion and Order denying the Mitts Law Firm's claim to an attorney charging lien for additional fees from its former clients in the above-captioned case.[1] Devon had previously entered into a settlement agreement with Defendants in this case, which provided that a portion of the settlement proceeds be paid to Devon. After the Mitts Firm asserted the charging lien against the settlement proceeds, the Court Ordered that $4.1 million of the proceeds be placed in an escrow account with the Clerk of Court, pending the resolution of the attorney charging lien asserted not only by the Mitts Firm but also by several vendors that the Mitts Firm retained to assist in the litigation. The third-party vendors with an interest in the escrowed funds are: (1) EconLit, LLC; (2) ParenteBeard, LLC; and (3) FranklyLegal, LLC (collectively referred to as "Intervenors"). In the seventy-three page Opinion issued after hearings held over six days, the Court held that neither the Mitts Firm nor the Intervenors were entitled to the imposition of a charging lien on the settlement funds. The Court did find, however, that in applying the law of equitable estoppel, the Intervenors were entitled to be paid for services rendered in the litigation from December 27, 2011 to March 2012. The Court held that Devon will receive the balance of the $4.1 million settlement proceeds after payment to the Intervenors.

On December 8, 2013, the Mitts Firm filed a Motion for a Stay of this Court's November 21, 2013 Opinion and Order and for Relief Pursuant to Federal Rules of Civil Procedure 52, 59 and 60. (Doc. No. 314.) Devon filed a Response in Opposition (Doc. No. 316), and the Mitts Firm filed a Reply. (Doc. No. 318.) For reasons that follow, the Court will deny the Motion filed by the Mitts Firm. (Doc. No. 314.)

II. BACKGROUND

As noted above, after the Mitts Firm had a dispute over legal fees with its client, Devon, the Court Ordered that $4.1 million of the settlement proceeds be placed in an escrow account with the Clerk of Court. The Mitts Firm, and the Intervenors employed by the Mitts Firm to assist in the litigation, asserted a charging lien against the funds. Hearings on the charging liens were held on November 14, 15, and 29, 2012 and January 22 to 24, 2013. On November 21, 2013, the Court issued the Opinion holding that a charging lien would not be applied to the settlement proceeds, and that the Intervenors were entitled to be paid under the law of equitable estoppel for work performed within the specified dates.

Pursuant to the Court's Order, each of the Intervenors entered into a stipulation with Devon regarding the fees and costs owed to them. EconLit and Devon stipulated that the amount owed to EconLit is $340, 083.31. (Doc. No. 308.) FranklyLegal and Devon stipulated that the amount owed to FranklyLegal is $277, 453.69. (Doc. No. 309.) Finally, ParenteBeard and Devon stipulated that the amount owed to ParenteBeard is $450, 042.06. (Doc. No. 307.) The Mitts Firm then filed the instant Motion, essentially seeking reconsideration and a stay. None of the parties have objected to paying the Intervenors the stipulated amounts upon resolution of the Motion of the Mitts Firm.

III. STANDARD OF REVIEW

The Motion of the Mitts Firm seeks a stay of this Court's November 21, 2013 Opinion and Order and relief pursuant to Federal Rules of Civil Procedure 52, 59, and 60.

A. Federal Rules of Civil Procedure 52(b) and 59(a)-(d)

Federal Rule of Civil Procedure 52(b) provides:

Amended or Additional Findings. On a party's motion filed no later than 28 days after the entry of judgment[2], the court may amend its findings - or make additional findings - and may amend the judgment accordingly. The motion may accompany a motion for a new trial under Rule 59.

The Mitts Firm contends that it can seek relief under Rule 52(b) with an accompanying motion for a new trial under Rule 59. Federal Rule of Civil Procedure 59 provides grounds for a new trial and for amending or altering a judgment. Both Rules 52(b) and 59(a)-(d) provide for amendment or additional findings and conclusions by the Court after a non-jury trial is conducted. In accordance with these Rules, the Court made findings and conclusions in the Opinion dated November 21, 2013, and will consider the arguments of the Mitts Firm regarding the November 21, 2013 Opinion and Order to the extent authorized by the rules.

B. Federal Rule of Civil Procedure 59(e)

Rule 59(e) provides that a motion to alter or amend a judgment must be filed within twenty-eight days of the judgment. The purpose of Rule 59(e) is to allow a district court to rectify its mistakes in the period immediately following entry of a judgment. White v. New Hampshire Dept. of Employment Sec. , 455 U.S. 445 (1982). Courts have considerable discretion in determining whether to grant or deny a motion to alter or amend a judgment, and may grant the motion in any of the following circumstances:

(1) to take account of an intervening change in controlling law;
(2) to take account of newly discovered evidence;
(3) to correct clear legal error; or
(4) to prevent manifest injustice.

Fed. R. Civ. P. 59(e); North River Ins. Co. v. CIGNA Reinsurance Co. , 52 F.3d 1194, 1218 (3d Cir. 1995). A Rule 59(e) motion may not be used to relitigate the same matters already determined by the court, and may not be used to raise arguments or present evidence that could reasonably have been raised before the entry of judgment. Analytical Surveys, Inc. v. Tonga Partners, L.P. , 684 F.3d 36, 52-53 (2d Cir. 2012). The Court of Appeals will review motions to alter or amend a judgment filed pursuant to Rule 59(e) review for abuse of discretion, "except over matters of law, which are subject to plenary review." Cureton v. National Collegiate Althetic Ass'n , 252 F.3d 267, 272 (3d Cir. 2001).

C. Federal Rule of Civil Procedure 60

Federal Rule of Civil Procedure 60(b) provides that a party may obtain relief from a judgment or order of the court for ...


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