John Middleton v. J.E. McDonald ( 2004 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
________________
No. 03-3179
________________
John Charles Middleton, *
*
Appellant, *
* Appeal from the United States
v. * District Court for the
* Western District of Missouri.
J. E. McDonald; Clinton County *
Sheriff’s Department, * [PUBLISHED]
*
Appellees. *
________________
Submitted: September 17, 2004
Filed: November 8, 2004
________________
Before COLLOTON, HEANEY, and HANSEN, Circuit Judges.
________________
HANSEN, Circuit Judge.
This appeal results from John Charles Middleton’s attempt in 2003 to set aside
a settlement and voluntary dismissal that he entered into in 1999 with defendant J. E.
McDonald, representing the Missouri Highway Patrol. See Fed. R. Civ. P. 60(b).
The district court1 denied the motion to set aside the judgment of dismissal as
untimely, and we affirm.
1
The Honorable Ortrie D. Smith, United States District Judge for the Western
District of Missouri.
Middleton, a state prisoner incarcerated in Missouri after conviction for three
first-degree murders (which are unrelated to the basis of this lawsuit), originally filed
this 42 U.S.C. § 1983 action in 1998. Middleton alleged that McDonald and the
Clinton County Sheriff’s Department had improperly seized and retained $5,877.42
in cash that had been in his vehicle when he was arrested on drug charges in May of
1995. The state neither instituted forfeiture proceedings nor tried Middleton on the
drug charges. Middleton sought the return of this money. In August 1999, the
district court granted summary judgment in favor of the Clinton County Sheriff’s
Department, and it is not a party to this appeal. Middleton then settled his lawsuit
with McDonald who, on behalf of the State of Missouri, agreed to return the money
seized but denied § 1983 liability. The parties agreed that upon signing the
agreement, Middleton would voluntarily dismiss with prejudice the pending § 1983
suit. Middleton and McDonald then filed a joint stipulation to dismiss the case with
prejudice, and the district court terminated the case pursuant to their stipulation on
September 30, 1999. The state paid the funds into Middleton’s prison account on
December 2, 1999.
Eight days after depositing the funds into Middleton’s prison account, the state
invoked the provisions of the Missouri Incarceration Reimbursement Act (MIRA),
Mo. Rev. Stat. §§ 217.825 - 217.841, by filing suit in state court to collect 90% of the
funds then in Middleton’s prison account to reimburse the state for the cost of his
incarceration on the murder convictions. Middleton responded that federal law
precluded the state’s recovery of these funds, citing Hankins v. Finnel, 964 F.2d 853,
861 (8th Cir.) (holding, in a fact-specific circumstance, that the Supremacy Clause
prohibited the state from using MIRA to recover funds it had paid to an inmate as
compensation for a state actor’s civil rights violation), cert. denied, 506 U.S. 1013(1992). The Circuit Court of Cole County, Missouri, rejected Middleton’s argument
and entered judgment in favor of the state. Middleton appealed to the Missouri Court
of Appeals, which affirmed, concluding that the Hankins case was distinguishable.
Middleton sought no further review of that decision.
-2-
On February 4, 2003, Middleton filed a motion in federal district court to set
aside the 1999 judgment of dismissal, citing Federal Rule of Civil Procedure 60(b)(6).
In the motion, Middleton alleged that the state wrongfully withheld his money in the
first instance and that the circumstances “strongly suggest bad faith on the part of the
State of Missouri in entering into a settlement” with a pro se petitioner without
indicating that it intended to reclaim the money through a MIRA action. (Appellant’s
App. at A19-A20.) The district court denied the Rule 60(b) motion as untimely, and
Middleton appeals.
We will reverse the denial of a Rule 60(b) motion only upon a showing of a
clear abuse of discretion. Sellers v. Mineta, 350 F.3d 706, 716 (8th Cir. 2003). “Rule
60(b) provides extraordinary relief in exceptional circumstances.” Id. Additionally,
we have noted that “[w]hen a party voluntarily accepted [an] earlier decision, its
burden is perhaps even more formidable than if it had litigated the claim and lost.”
Schultz v. Commerce First Fin., 24 F.3d 1023, 1024 (8th Cir. 1994) (internal marks
omitted).
The district court denied Middleton’s Rule 60(b) motion as untimely, because
the motion is premised upon fraud or misconduct on the part of the state, and
Middleton did not file it within the one-year limitation for motions based upon fraud
or misconduct. See Rule 60(b)(3) (permitting the setting aside of a judgment that is
based upon “fraud . . ., misrepresentation or other misconduct of an adverse party” but
stating that such motion must be made not more than one year after the judgment was
entered). Although Middleton recites Rule 60(b)(6), which is not subject to the one-
year limitation, as the basis for setting aside the earlier judgment of dismissal, the
substance of his motion clearly implicates subsection (3) by stating that “the
circumstances here strongly suggest bad faith on the part of the State” in entering into
the settlement. (Appellant’s App. at A19.)
-3-
We conclude that the district court did not clearly abuse its broad discretion in
determining that the premise of Middleton’s argument is in fact fraud under
subsection (3). Because the substance of Middleton’s Rule 60(b) motion is in reality
grounded in subsection (3), we agree with the district court that the claim is subject
to the one-year limitation period, and Middleton cannot avoid that limitation by
labeling the motion as brought pursuant to subsection (6). Cf. Schultz, 24 F.3d at
1025 (analyzing a claim under subsection (6) where the parties did not raise the
timeliness issue, but noting that where the essence of the argument is in reality based
upon one of the first three enumerated grounds for relief, it is subject to the one-year
limitation). Subsection (6) is not a permissible means by which to avoid the time
limitation otherwise applicable to a claim of fraud, misrepresentation or misconduct
by the adverse party. See Kalamazoo River Study Group v. Rockwell Int’l Corp., 355
F.3d 574, 588 (6th Cir. 2004) (noting that parties will not be permitted to disguise a
Rule 60(b)(1), (2) or (3) motion as a subsection (5) or (6) motion in order to gain the
benefits of a more generous time limitation); Lyon v. Agusta S.P.A., 252 F.3d 1078,
1088-89 (9th Cir. 2001) (holding that “clause (6) and the preceding clauses are
mutually exclusive” and that subsection (6) cannot be a substitute for, but must be
brought for some reason other than, the reasons stated in the five preceding
subsections (internal marks omitted)), cert. denied, 534 U.S. 1079 (2002). Middleton
filed his motion over three years after the case had been dismissed with prejudice
pursuant to the agreement of the parties. This was well outside the one-year
limitation of Rule 60(b)(3). The district court did not clearly abuse its broad
discretion in dismissing the motion as untimely.
Middleton argues that his motion was properly asserted under subsection (6)
because, separate from the bad faith issue, he also alleged that the state’s action of
seizing his settlement funds was unjust. A motion based upon subsection (6),
permitting relief from a judgment for “any other reason” need only be filed “within
a reasonable time.” Fed. R. Civ. P. 60(b). “What constitutes a reasonable time is
dependent on the particular facts of the case in question and is reviewed for abuse of
-4-
discretion.” Watkins v. Lundell, 169 F.3d 540, 544 (8th Cir.), cert. denied, 528 U.S.
928 (1999). Middleton asserts that he brought this motion within a reasonable time
because he first defended the state MIRA litigation.
Even assuming that the asserted subsection (6) basis for the motion is separate
from Middleton’s claim of fraud and misconduct, we would nevertheless conclude
that the district court correctly denied the motion as untimely. See United States v.
Wells, 347 F.3d 280, 287 (8th Cir. 2003) (“It is a well-settled principle that we may
affirm a district court’s judgment on any basis supported by the record.” (internal
marks omitted)), cert. denied, 124 S. Ct. 2435 (2004). Middleton’s three-year delay
was not reasonable. See Kellogg v. Strack, 269 F.3d 100, 104 (2d Cir. 2001) (holding
that a 26-month delay was “a period of time which constitutes a patently unreasonable
delay absent mitigating circumstances”), cert. denied, 535 U.S. 932 (2002); Watkins,
169 F.3d at 544 (expressing “considerable trepidation” about whether a 17-month
delay was reasonable, but ultimately finding that the issue was not properly before the
court); Nucor Corp. v. Neb. Pub. Power Dist., 999 F.2d 372, 374-75 (8th Cir. 1993)
(holding a three and one-half year delay was unreasonable).
No mitigating circumstances exist to render this three-year delay reasonable.
Middleton knew of the state’s decision to seek reimbursement from the settlement
funds within three months of the settlement agreement. His attempt to set aside the
settlement judgment in federal court could have been filed shortly after this revelation
as all the facts were known when the state initiated the MIRA action eight days after
depositing the funds in his account. Instead, he chose to defend the MIRA action in
state court, to submit the federal constitutional issue to the state court, and then to
return to federal court only after receiving an adverse determination in the state court.
The delay caused by Middleton’s decision to pursue the federal claim in state court
is not a reasonable delay for purposes of his Rule 60(b) motion but rather a legitimate
choice of forum. State courts are equally competent to determine issues of federal
constitutional law. Simes v. Huckabee, 354 F.3d 823, 829 (8th Cir. 2004). We will
-5-
not disturb the state court’s judgment in the MIRA action by permitting Middleton
to set aside his federal court settlement at this late date. See Prince v. Ark. Bd. of
Exam’s in Psychology, 380 F.3d 337, 340 (8th Cir. 2004) (stating that “[t]he Rooker-
Feldman doctrine bars both straightforward and indirect attempts by a plaintiff to
undermine state court decisions” (internal marks omitted)). No extraordinary
circumstances prevented him from returning to federal court in a more timely manner.
See United States v. Alpine Land & Reservoir Co., 984 F.2d 1047, 1049 (9th Cir.)
(stating that Supreme Court admonitions regarding Rule 60(b) indicate that
subsection (6) “relief is available only where extraordinary circumstances prevented
a litigant from seeking earlier, more timely relief”), cert. denied, 510 U.S. 813 (1993).
Finally, Middleton seeks to avoid the timeliness issues of Rule 60(b) by asking
this court to construe his motion as an independent action, because this court has held
that Rule 60(b) “has a savings clause that permits a court to entertain an independent
action if a motion is time-barred.” Griffin v. Fed. Deposit Ins. Corp., 831 F.2d 799,
803 (8th Cir. 1987). However, “a movant seeking leave from a court of appeals to
allow a district court to entertain an independent action must show that it would be
manifestly unconscionable to enforce the judgment.” Id. (internal marks omitted).
Middleton has failed to meet this heavy burden. While he may not have understood
when he entered into the settlement agreement that the state could bring a MIRA
action to recover up to 90% of those funds to reimburse it for the costs of his
incarceration, once aware that the state was pursuing this remedy, he had his day in
court.2 Middleton fully litigated the matter in the state court system where he raised
his federal constitutional argument. The state courts ruled in favor of the state, and
Middleton sought no review in the Supreme Court of the United States. As already
2
Middleton at one point unsuccessfully attempted to remove the state MIRA
action to federal court, but he did not seek Rule 60(b) relief in this § 1983 case until
three years later, after the claim was adjudicated in state court.
-6-
noted, state courts are fully competent to determine issues of federal constitutional
law. Because Middleton’s constitutional claim was heard and fully litigated,
enforcing the judgment of dismissal in this case is not manifestly unconscionable, and
we will not construe his Rule 60(b) motion as an independent action.
Finding no abuse of discretion, we affirm the judgment of the district court
denying as untimely Middleton’s Rule 60(b) motion to set aside the judgment of
dismissal.
______________________________
-7-