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Parties Involved:
Vitamins Antitrust Litigation

Document Text:

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 21, 2003 Decided May 6, 2003

No. 02-7025

IN RE: VITAMINS ANTITRUST CLASS ACTIONS

Appeal from the United States District Court

for the District of Columbia

(No. 99ms00197)

–————

Jeffrey S. Cashdan argued the cause for appellant UCB

Chemicals Corporation. With him on the briefs was Kevin R.

Sullivan. Jeffrey S. Bucholtz entered an appearance.

Gerald G. Saltarelli argued the cause and filed the brief for

appellee Hill’s Pet Nutrition, Inc.

Before: GINSBURG, Chief Judge, and SENTELLE and

RANDOLPH, Circuit Judges.

Opinion for the Court filed by Circuit Judge SENTELLE.

SENTELLE, Circuit Judge: UCB Chemicals Corporation appeals from a February 22, 2002 order of the district court

granting Hill’s Pet Nutrition Inc.’s (‘‘Hill’s Pet’’) Motion to

Modify the Final Order Approving Class Settlement and

Final Judgment entered by the district court on November

 Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.

USCA Case #02-7025 Document #747823 Filed: 05/06/2003 Page 1 of 4
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30, 2001. We affirm the order because the district judge did

not abuse his discretion when he found that Hill’s Pet’s

neglect in failing to timely opt out of the settlement was

excusable.

Background

The class settlement at issue in this case is one of the many

federal antitrust actions alleging price-fixing by suppliers of

vitamins. The claims against UCB and other providers of

choline chloride were consolidated before a single judge of the

United States District Court for the District of Columbia

under the title In re Vitamins Antitrust Litigation for pretrial proceedings. On July 25, 2001, the district court entered

an order certifying the UCB Settlement Class and preliminarily approving the proposed settlement, in which UCB

agreed to pay $9 million for a complete release of claims

against it. The order contained a plan for notifying class

members of the settlement. The plan provided for mailing

notices to class members as well as publishing notices in

widely read industry periodicals and the Wall Street Journal.

The notices expressly stated that members would be bound

by the settlement and could opt out by sending a written

request postmarked before or on September 28, 2001. The

Claims Administrator mailed a notice to Hill’s Pet’s corporate

parent, at the same address to which prior notices, which had

elicited responses, had been sent. The notice was also posted

online. On November 30, 2001, the district judge entered a

final judgment approving the settlement. When Hill’s Pet’s

counsel reviewed an exhibit attached to the final order, on

December 10, 2001, he discovered that Hill’s Pet was not

listed among the class members who had timely opted out.

Two days later, he filed a Motion to Modify the Final Order

Approving the Class Settlement and Final Judgment to allow

Hill’s Pet to opt out of the settlement. The court granted

this motion pursuant to Fed. R. Civ. P. 6(b) and 60(b) after

finding that Hill’s Pet’s failure to file a timely opt-out notice

was the result of excusable neglect, not bad-faith, and that

UCB would not be substantially prejudiced.

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Analysis

This court reviews the district court’s decision for abuse of

discretion, which allows for reversal only if the district court

applied the wrong legal standard or relied on clearly erroneous findings of fact. See Peters v. Nat’l R.R. Passenger

Corp., 966 F.2d 1483, 1485 (D.C. Cir. 1992); Linder v. Dept.

of Defense, 133 F.3d 17, 24 (D.C. Cir. 1998). The district

court had discretion, pursuant to Fed. R. Civ. P. 6(b) and

Fed. R. Civ. P. 60(b), to modify its order so that Hill’s Pet

would be able to opt-out of the settlement beyond the agreed

opt-out date. Rule 6(b) states that ‘‘the court for cause

shown may at any time in its discretion TTT permit the act to

be done where the failure to act was the result of excusable

neglect.’’ Fed. R. Civ. P. 6(b). Additionally, Rule 60(b)

provides that ‘‘[o]n 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: (1) mistake, inadvertence, surprise, or excusable

neglect, TTT or (6) any other reason justifying relief from the

operation of the judgment.’’ Fed. R. Civ. P. 60(b).

The Supreme Court addressed the meaning of ‘‘excusable

neglect’’ in Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd.

P’ship, 507 U.S. 380 (1993). The Court set forth factors to

consider when determining what kind of neglect will be

considered ‘‘excusable.’’ These include: (1) the danger of

prejudice to the party opposing the modification, (2) the

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. Id. at 395. The district

judge in the current case evaluated the factors articulated,

and found that UCB would not be substantially prejudiced by

Hill’s Pet’s untimely opt-out; the length of the delay was

short and would not impact judicial proceedings; and that

there was no indication that Hill’s Pet had acted in bad faith.

The court also found that the reason for the delay was within

Hill’s Pet’s reasonable control but that the other factors

outweighed the impact of this finding, and consequently

granted Hill’s Pet’s motion to modify the final order.

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On appeal, UCB urges this court to adopt a per se rule that

garden variety attorney inattention can never constitute excusable neglect. We decline and uphold the district court.

The Pioneer standard precludes the adoption of any such per

se rule. The Court in Pioneer purposely fashioned a flexible

rule which, by its nature, counsels against the imposition of a

per se rule on attorney neglect. ‘‘Although inadvertence,

ignorance of the rules, or mistakes construing the rules do

not usually constitute ‘excusable’ neglect, it is clear that

‘excusable neglect’ TTT is a somewhat ‘elastic concept’ and is

not limited strictly to omissions caused by circumstances

beyond the control of the movant.’’ Id. at 392. See Yesudian

ex rel. U.S. v. Howard Univ., 270 F.3d 969, 971 (D.C. Cir.

2001) (applying the excusable neglect standard without emphasis on any particular Pioneer factor.)

UCB argues that some of our sister circuits have suggested

that certain types of attorney neglect can never constitute

excusable neglect. The Eighth Circuit has stated in a recent

case, ‘‘Notwithstanding the ‘flexible’ Pioneer standard, experienced counsel’s misapplication of clear and unambiguous procedural rules cannot excuse his failure to file a timely notice

of appeal.’’ Lowry v. McDonnell Douglas Corp., 211 F.3d

457, 464 (8th Cir. 2000). Likewise, the Eleventh Circuit has

held, ‘‘an attorney’s misunderstanding of the plain language

of a rule cannot constitute excusable neglect such that a party

is relieved of the consequences of failing to comply with a

statutory deadline.’’ Advanced Estimating Sys., Inc. v. Riney, 130 F.3d 996, 998 (11th Cir. 1997). We note that we

doubt the applicability of such precedents to the present case

because each involves an attorney’s failure to file a timely

notice of appeal, an issue of special interest to the courts of

appeal. Lowry, 211 F.3d at 458; Advanced Estimating Sys.,

130 F.3d at 997. By contrast, the current case involves a

case-management decision in a complex class action, in which

district court discretion is at its greatest. In any case,

because we find the question of whether attorney error may

constitute ‘‘excusable neglect’’ is within the discretion of the

district court and the court did not abuse its discretion, we

will affirm the modification of the final judgment.

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