Free Relief from Judgment - Rule 60 - District Court of Federal Claims - federal

Case 1:05-cv-01252-CFL

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS THE TRAVELERS INDEMNITY COMPANY, Successor in Interest by Merger to Gulf Insurance Company, Plaintiff, v. THE UNITED STATES, Defendant. ) ) ) ) ) ) ) ) ) ) )

No. 05-1252C (Judge Lettow)

DEFENDANT'S UNOPPOSED MOTION FOR RELIEF FROM JUDGMENT Pursuant to Rule 60(b)(5) of the Rules of the United States Court of Federal Claims ("RCFC"), defendant, the United States, respectfully moves this Court for relief from the judgment entered against the United States on July 27, 2006. As we explain below, the parties are in agreement that the judgment has been satisfied through the payment of plaintiff's claim through the bankruptcy proceeding, In re M.J.H. Leasing, Inc., M.A.T. Marine, Inc., Case nos. 04-18802, 04-19106 (Bankr. E.D. Mass.). Because the amount awarded in this Court's judgment has been paid to plaintiff, "it is no longer equitable that the judgment have prospective application." RCFC 60(b)(5). Plaintiff, the Travelers Indemnity Company, successor in interest by merger to Gulf Insurance Company ("Travelers"), consents to the grant of relief requested in this motion. This case involves a claim by Travelers for recovery of sums paid to subcontractors to a Government contract pursuant to a Miller Act payment bond after those subcontractors did not receive payment from the Government's prime contractor, M.A.T. Marine, Inc. Judgment was entered in favor of Travelers on July 27, 2006. Concurrent with proceedings before this Court, Travelers sought recovery from the contractor, M.A.T. Marine which in 2004 filed for

Case 1:05-cv-01252-CFL

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bankruptcy. In re M.J. H. Leasing, Inc., M.A.T, Marine, Inc., Case nos. 04-18802, 04-19106, (Bankr. E.D. Mass.) (jointly administered). Following this Court's entry of judgment on July 27, 2006, the United States filed an appeal before the United States Court of Appeals for the Federal Circuit. On April 24, 2007, the Court of Appeals granted our motion and stayed proceedings pending the disposition of Travelers's claim against M.A.T. Marine. On October 18, 2007, M.A.T. Marine's Trustee in bankruptcy issued a check to Travelers that paid the claim in full. Attachment 1.1 After Travelers received payment, the parties advised the Court of Appeals that Travelers receipt of payment from M.A.T. Marine had fully satisfied the judgment that Travelers obtained against the United States in this case. The United States, supported by Travelers, requested that the Court remand this case to this Court. On January 9, 2008, the Court of Appeals granted our motion to remand. In so doing, the Court explained that "to the extent that the parties seek vacatur of the trial court's judgment, they should seek that relief from the trial court." Attachment 2. RCFC 60(b) provides that "[o]n motion and upon such terms as are just, the court may relieve a party of a party's legal representative from a final judgment . . . ." RCFC 60(b)(5), in turn, provides that the reasons for granting relief include that "the judgment has been satisfied, released, or discharged . . . or it is no longer equitable that the judgment should have prospective application." Because Travelers has received payment from M.A.T. Marine for the same losses that were the basis for the judgment entered against the United States in this case, payment of the outstanding judgment would constitute a double recovery, which should not be allowed. See

Travelers received a check in the amount of $370,845.13, reflecting payment in full of Travelers's unsecured claim against M.A.T. Marine ($347,423.28), plus interest. That amount included the $32,718.99 sought and awarded from the United States in this case. 2

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Case 1:05-cv-01252-CFL

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FDIC v. United Pacific Insurance Co., 152 F.3d 1266, 1275 (10th Cir. 1998); Sunderland v. City of Phila., 575 F.2d 1089, 1090 (3d Cir. 1978). For the reasons explained above, the United States, with Travelers's consent, respectfully requests that the Court relieve the United States from the judgment entered on July 27, 2006. Respectfully submitted, JEFFREY S. BUCHOLTZ Acting Assistant Attorney General

s/ Jeanne E. Davidson JEANNE E. DAVIDSON Director

s/ Kirk T. Manhardt KIRK T. MANHARDT Assistant Director Commercial Litigation Branch Department of Justice 1100 L Street, N.W. Attn: Classification Unit 8th Floor Washington, D.C. 20530 Tele: (202) 353-0541 Fax: (202) 514-8640 Attorneys for Defendant January 30, 2008

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Case 1:05-cv-01252-CFL

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CERTIFICATE OF FILING I hereby certify that on January 30, 2008, a copy of foregoing "DEFENDANT'S UNOPPOSED MOTION FOR RELIEF FROM JUDGMENT" was filed electronically. I understand that notice of this filing will be sent to all parties by operation of the Court's electronic filing system. Parties may access this filing through the Court's system.

s/Kirk T. Manhardt Kirk T. Manhardt