Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_06-cv-01728/USCOURTS-caed-1_06-cv-01728-4/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:1332 Diversity-Fraud

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IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

AMIT MAHAJAN, )

)

Plaintiff, )

)

v. )

)

SANGEETA KUMAR (aka SANGEETA )

KUMARI), RAJNESH KUMAR, VISMA )

KUMAR, and iFREEDOM DIRECT )

CORPORATION (formerly NEW )

FREEDOM MORTGAGE COMPANY), )

)

Defendants. )

____________________________________)

CV F 06-1728 AWI SMS

MEMORANDUM OPINION

AND ORDER ON

PLAINTIFF’S MOTION FOR

RELIEF PURSUANT TO

F.R.C.P. 60(b)

[Document #38]

In this action in diversity for damages by plaintiff Amit Mahajan (“Plaintiff”) against

defendants Sangeeta Kumar (aka Sangeeta Kumari) (hereinafter “Sangeeta”), Rajnesh

Kumar, Visma Kumar and iFreedom Direct Corp. (formerly New Freedom Mortgage)

(hereinafter “iFreedom”) (collectively “Defendants”), Plaintiff has moved for relief pursuant

to Rule 60(b) of the Federal Rules of Civil Procedure from the April 30, 2007 order of this

court dismissing defendant iFreedom. For the reasons that follow, the court will allow

Plaintiff to file an amended complaint. Relief pursuant to Rule 60(b) will be otherwise

denied. 

PROCEDURAL HISTORY

This case was removed from the Superior Court of Mercer County, New Jersey, to the

District Court for the District of New Jersey on May 19, 2006. Defendant iFreedom moved

Case 1:06-cv-01728-AWI-SMS Document 46 Filed 01/18/08 Page 1 of 10
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All citations to “Rules” hereinafter are to the Federal Rules of Civil Procedure

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unless otherwise specified.

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to dismiss on grounds of improper venue on June 12, 2006, and the individual defendants

moved to dismiss for lack of personal jurisdiction on June 27, 2006. On November 22, 2006,

the District Court of New Jersey ordered the case transferred to this district and denied as

moot all pending motions to dismiss or quash based on improper venue or lack of personal

jurisdiction. 

Defendant iFreedom filed a motion to dismiss pursuant to Rule 12(b)(6) of the

Federal Rules of Civil Procedure on January 5, 2007. Plaintiff filed no opposition or 1

statement of non-opposition to iFreedom’s motion. On April 30, 2007, the court issued an

order (the “April 30 Order”) dismissing the complaint as to iFreedom and granting a period

of 30 days to amend the complaint. No amended complaint was filed within the 30-day

period. The instant motion for relief pursuant to Rule 60 was filed by Plaintiff on November

5, 2007. Defendant iFreedom’s opposition was filed on November 19, 2007. Plaintiff’s 

reply was filed on November 26, 2007. The matter was taken under submission as of

December 3, 2007.

PLAINTIFF’S ALLEGED FACTS

The factual background giving rise to the instant action was set forth in the court’s

April 30 Order and need not be repeated here. Plaintiff’s motion for relief pursuant to Rule

60 is based on facts pertaining to the continuity of representation provided by Plaintiff’s

attorneys following the transfer of the case from the District Court of New Jersey to this

court. 

Plaintiff is a New Jersey resident who engaged the services of a New York law firm,

the Blanch Law Firm, P.C., to represent Plaintiff in the instant action. The associate handling

the case on behalf of the Blanch Law Firm is Michael Kushner. The Blanch Law Firm

determined the proper forum for filing the complaint was the District Court of New Jersey.

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Because Kushner is not licensed to practice in New Jersey, the Blanch Law Firm engaged the

services of Diane Acciavatti, a New Jersey attorney, to act as local counsel. According to a

certification filed by Acciavatti in support of her motion to withdraw as counsel for Plaintiff,

there was never any direct communication between Plaintiff and Acciavatti. Acciavatti states

her service on behalf of the Blanch Law Firm consisted only of reviewing pleadings prepared

by Kushner for conformity with local rules and ensuring that pleadings were properly filed

and served. According to Acciavatti’s declaration, it was never her understanding that she

would represent Plaintiff in any proceedings outside of New Jersey. 

Kushner’s declaration in support of the instant motion for relief pursuant to Rule

60(b) alleges a number of facts surrounding the relocation of his law firm to another office in

the Empire State Building in New York. Of the facts alleged, only two are relevant to the

court’s resolution of the instant motion for relief. Kushner alleges that he moved to a

different office on a different floor of the Empire State building in February of 2007, and that

he notified Acciavatti of the relocation on February 20, 2007. Defendants do not challenge

the factuality of the foregoing allegations.

LEGAL STANDARD

Rule 60(b) permits a district court to relieve a party from a final order or judgment on

grounds of: “(1) mistake, inadvertence, surprise, or excusable neglect; (3) fraud . . . of an

adverse party, . . . or (6) any other reason justifying relief from the operation of the

judgment.” The motion for reconsideration must be made within a reasonable time, in any

event “not more than one year after the judgment, order, or proceeding was entered or taken.” 

Id.

Motions to reconsider are committed to the discretion of the trial court. Combs v.

Nick Garin Trucking, 825 F.2d 437, 441 (D.C.Cir. 1987); Rodgers v. Watt, 722 F.2d 456,

460 (9th Cir. 1983) (en banc). To succeed, a party must set forth facts or law of a strongly

convincing nature to induce the court to reverse its prior decision. See, e.g., Kern-Tulare

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Water Dist. v. City of Bakersfield, 634 F.Supp. 656, 665 (E.D.Cal. 1986), aff’d in part and

rev’d in part on other grounds, 828 F.2d 514 (9th Cir. 1987), cert. denied, 486 U.S. 1015, 108

S.Ct. 1752, 100 L.Ed.2d 214 (1988). The Ninth Circuit has stated that “[c]lause 60(b)(6) is

residual and ‘must be read as being exclusive of the preceding clauses.’” LaFarge Conseils et

Etudes, S.A. v. Kaiser Cement, 791 F.2d 1334, 1338 (9th Cir. 1986), quoting Corex Corp. v.

United States, 638 F.2d 119 (9th Cir. 1981). Accordingly, “the clause is reserved for

‘extraordinary circumstances.’” Id. See Catholic Soc. Servs. V. Ashcroft, (No. CIV S-86-

1343 LKK), 2002 U.S. Dist. LEXIS 19194, *57, n. 18 (E.D. Cal. July 25, 2002) (“Generally

speaking, before reconsideration may be granted, there must be a change in the controlling

law, the need to correct a clear error, or the need to prevent manifest injustice.”).

DISCUSSION

Plaintiff requests the court grant relief from the court’s April 30 Order dismissing

iFreedom by vacating the decision and allowing Plaintiff to file an opposition to the motion

to dismiss. In the alternative Plaintiff requests relief from the 30-day time limit imposed by

the April 30 Order for the filing of an amended complaint. Thus, Plaintiff’s request

implicates two missed deadlines; the deadline for the filing of an opposition to the motion to

dismiss and the deadline for the filing of an amended complaint. Because the two deadlines

are established by different triggering events, Plaintiff’s motion for relief requires separate

analyses of each specific relief requested. 

In both cases, the basis for Plaintiff’s motion for relief is that the missed deadline was

the result of excusable neglect. In Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’ship.,

507 U.S. 380 (1993), the Supreme Court held, in the context of a bankruptcy case, that the

term “neglect” contained in the term “excusable neglect” incorporates inadvertence, mistake

or carelessness. Id. at 392. The court may therefore not deny relief simply because the

neglect is not due to factors beyond the control of the moving party but must engage in an

equitable weighing of factors to determine if the neglect is excusable. Id. at 395. The factors

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enumerated by the Supreme Court are “(1) danger of prejudice to the non-movant; (2) length

of delay and its potential impact 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.” In re Rebel Rents, Inc., 326 B.R. 791, 799 (C.D. Cal. 2005)

(enumerating factors from Pioneer, 507 U.S. at 395). In Briones v. Riviera Hotel & Casino,

116 F.3d 379 (9th Cir 1997), the Ninth Circuit applied the Pioneer four-part test for

excusable neglect to the determination of excusable neglect in the context of a motion for

relief pursuant to Rule 60(b). Id. at 382. “These four enumerated factors, while not an

exclusive list, provide a framework with which to determine whether missing a filing

deadline constitutes ‘excusable’ neglect.” Id. at 381.

I. Relief From Deadline to File Opposition

The motion to dismiss iFreedom was filed on January 5, 2007. Pursuant to Local

Rule 78-230, Plaintiff’s obligation to file an opposition or statement of non-opposition to the

motion to dismiss within 14 days was triggered by the filing of the motion. According to the

court’s order vacating oral argument and taking the matter under submission, the last day for

filing an opposition to iFreedom’s motion was not later than February 20, 2007. The motion

for relief was filed approximately eight and one-half months after the missed deadline. The

motion to dismiss was granted by the April 30 order following consideration of the motion on

its merits. 

A. Prejudice to the Non-Moving Party

Defendant iFreedom’s claim that it would be prejudiced by a grant of relief under

Rule 60(b) bases its claim on the fact it would be required to re-litigate its defense. 

Generally, a party is held to suffer little prejudice where it is denied the opportunity to an

early conclusion of the case against it. See Bateman v. United States Postal Service, 231

F.3d 1220, 1224-1225 (9th Cir. 2000) (prejudice arising from delay of final adjudication is

insufficient to deny Rule 60(b) relief). Other than having to file a reply to Plaintiff’s

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opposition, iFreedom would be in essentially the same position it would have been had

Plaintiff timely filed its opposition, only eight months later. The court concludes the delay in

the final adjudication of Plaintiff’s claim against iFreedom is not enough, without more to

require denial of Rule 60 relief.

With respect to prejudice, it is worth noting that Plaintiff suffers little prejudice if the

court denies the request to vacate the April 30 Order and denies Plaintiff’s request to be

allowed to file an opposition to iFreedom’s motion to dismiss. The court dismissed

iFreedom after considering the sufficiency of the pleading contained in the complaint and

concluding the pleading was not sufficient to state a claim for relief. Specifically, the court

determined that, with respect to the first five claims for relief, that Plaintiff’s allegations

failed to state a claim against iFreedom because the complaint failed to allege a “causal

nexus” between iFreedom and the bad acts alleged against the individual defendants. See

Lisa M. v. Henry Mayo Newhall Mem’l Hosp., 12 Cal.4th 291, 297 (1995) (employee’s

intentional tort will be imputed to the employer if there is a “causal nexus” between the

intentional tort and the employee’s work). The “causal nexus” requirement is met only if the

intentional tort was “‘engendered by the employment’ or arose therefrom.” Ins. Co. of N.

America, 189 F.3d at 922 (quoting Lisa M., 12 Cal.4th at 297). 

Plaintiff contends that his first five claims against iFreedom are meritorious because

individual defendant Sangeeta Kumari’s representations to Plaintiff were made in the context

of her employment with iFreedom. Whatever “context” might mean, the allegation of mere

context, without more, is not sufficient to state a causal nexus. The court has reviewed the

complaint again and finds, as before, that it is devoid of any allegation that Sangeeta’s

alleged tortuous acts occurred in the course of her work for iFreedom or in her professional

capacity as a broker for iFreedom.

Similarly, the court disagrees with Plaintiff’s contention that the complaint, as

originally pled, alleged facts sufficient to state a claim for negligent hiring and supervision. 

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As the court noted in the April 30 Order,

The tort [of negligent supervision and training] has developed in California in

factual settings where the plaintiff’s injury occurred in the workplace, or the

contact between the plaintiff and the employee was generated by the

employment relationship.” Mendoza v. City of Los Angeles, 66 Cal.App.4th

1333, 1339-1340 (2nd Dist. 1998). The plaintiff must be injured as a result of

his connection with the employment lest the employer become “the insurer of

the safety of a person with whom its employees come into contact, regardless

of their relationship to the employer.” Id. at 1341.

Doc. # 17 at 6:20-26.

The court continues to be of the opinion that, notwithstanding Plaintiff’s emphasis on

the context of Sangeeta’s actions or representations to Plaintiff, the complaint is devoid of

any factual allegation that Sangeeta was acting in connection with her employment when she

defrauded Plaintiff or obtained a credit report on him by false pretenses. The court has taken

the arguments put forward by Plaintiff with respect to the sufficiency of the original

complaint against iFreedom into account and continues to be of the opinion that the

complaint does not state a claim against iFreedom upon which relief could be granted.

In sum, the prejudice component of the four-part Pioneer analysis fails to show there

is any significant prejudice to either party if the motion for relief pursuant to Rule 60(b) is or

is not granted.

B. Length of Delay and its Potential Impact on Judicial Proceedings

As previously stated, the delay represented by the span of time between when the

opposition to the motion to dismiss should have been filed and the time of the instant motion

for relief is about eight and one-half months. Although the length of delay is longer than is

encountered in most of the cases that excuse miss deadlines, there is no specific allegation of

impact on the proceedings apart from the delay itself. The court concludes the length of

delay weighs somewhat against Plaintiff’s request to be permitted to file an opposition to the

motion to dismiss, but is not sufficient without more to warrant denial of relief.

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C. Reason for the Delay

Interestingly, although Kushner alleges a number of facts surrounding the failure the

Blanch Law Firm to file an opposition to the motion to dismiss, he does not tie any of these

facts to the actual failure to file an opposition. Defendant’s motion to dismiss was filed

January 5, 2007, and the Blanch Law Firm did not move from their office suite until an

unspecified time in February. Thus, the Blanch Law Firm, and Kushner in particular,

occupied their customary office space for a least three weeks and possibly considerably

longer from the time the motion was filed. 

The court has no basis to conclude that the event triggering Plaintiff’s obligation to

oppose the motion to dismiss – the filing of the motion – was unknown to Kushner. Kushner

does not contend that the Blanch Law Firm’s relationship with Acciavatti was anything other

than what Acciavatti claimed it to be in her declaration. That is; it was Acciavatti’s job to

edit, file and serve the papers prepared by Kushner and the Blanch Law Firm, and

presumably to pass along filings that required pleadings in response to Kushner so that the

latter could prepare the pleadings. With that relationship acknowledged, the only inference

the court can logically make is that the relationship between Acciavatti and Kushner was such

that it should be expected that Acciavatti would pass iFreedom’s motion to dismiss along to

Kushner or to the designated recipient at the Blanch Law Firm when the motion was served

on Acciavatti. 

Kushner offers no explanation why the Kushner or the Blanch Law Firm was not

informed of the motion to dismiss or, that Kushner or the Blanch Law Firm was, in fact, not

informed. A close reading of Kushner’s declaration and of the motion for relief indicates that

Kushner alleges actual ignorance of only two filings at the time they were filed; Acciavatti’s

motion to be relieved as counsel, and the Magistrate Judge’s order to show cause. Kushner

never specifically states that he was ignorant of iFreedom’s motion to dismiss.

Even if the court were free to make inferences on Kushner’s behalf, a proposition that

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is not contended or supported, there are no facts the court can identify that would tend to

bolster Kushner’s claim that the failure to file an opposition was “excusable” neglect. The

court cannot assume, for instance, that Kushner was not informed of the motion to dismiss by

Acciavatti, or that he reasonably or unreasonably expected Acciavatti to prepare an

opposition, or that he was informed of the motion but simply forgot about it in anticipation of

the move, or that he expected that Acciavatti would find an attorney in California to oppose

the motion to dismiss. Kushner’s failure to tie any of the facts he has alleged to the failure to

file an opposition to iFreedom’s motion to dismiss weighs very strongly against a conclusion

that the reason for the delay was “excusable.”

D. Bad Faith

There is no allegation or evidence of bad faith.

The court concludes that the balance of equities weighs against granting Plaintiff’s

request to file an opposition to iFreedom’s motion to dismiss. Although iFreedom would

suffer relatively little prejudice, Plaintiff would realize relatively little benefit and there is

little that would be gained by re-argument of a motion that was already decided on its merits. 

Weighing this lack of prejudice against the long and unexplained delay between the due date

for the opposition and the instant motion for relief, the court must conclude that the neglect

of Plaintiff’s counsel is not “excusable.”

II. Relief from the Deadline to File an Amended Complaint

The court’s April 30 Order granted thirty days from the date of service of the order to

file any amended complaint. The serving of the April 30 Order therefore is the event that

triggers Plaintiff’s obligation to file an amended complaint within 30 days. A careful review

of the court’s docket in this case raises a doubt that the April 30 Order was ever actually

served. The court’s docket indicates that the order of March 2, 2007, vacating the hearing

date for arguments on iFreedom’s motion to dismiss was served on Acciavatti by mail. 

Similarly, the clerk’s notice to Acciavatti that she had not submitted an application for pro

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hac vice status was served by mail, as was the court’s order of June 22, 2007, granting

Acciavatti’s motion to withdraw. So far as the court can discern from its docket report, the

court made the determination that the April 30 Order was to be served on Acciavatti by mail,

but there is no indication that service was ever effectuated. 

While the court finds much to criticize in the evident lack of communication between

Kushner and Acciavatti, and in Kushner’s lack of attention to the requirements of this court

to comply with local registration and electronic filing rules, the fact remains that the court’s

own possible oversight may have resulted in a situation where the obligation to file any

amended complaint within an identified time period was never technically triggered. In light

of that possible oversight, service of this order will commence the 30-day period for filing of

an amended complaint. The court presumes that Plaintiff’s current California Counsel has

completed the requirements for using the court’s electronic filing system and has availed

himself of the Court’s April 30 Order and any other needed documents. The April 30 Order

will therefore not be vacated and refiled.

THEREFORE, in consideration of the foregoing discussion, it is hereby ORDERED

that:

1. Plaintiffs motion for relief pursuant to Rule 60(b) requesting the court to vacate its

April 30 Order and permit opposition to iFreedom’s motion to dismiss is DENIED.

2. The court hereby DECLARES that the April 30 Order, docket number 17, is deemed

to be served as of the date of service of this order.

3. Plaintiff shall file and serve any amended complaint not later than thirty (30) days

from the date of service of this order.

4. Plaintiff’s motion for relief pursuant to Rule 60(b) to allow late filing of an amended

complaint is hereby DENIED as moot.

IT IS SO ORDERED.

Dated: January 17, 2008 /s/ Anthony W. Ishii 

0m8i78 UNITED STATES DISTRICT JUDGE

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