19-4197-cv

SEC v. Romeril

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

August Term 2020

(Argued: February 19, 2021 Decided: September 27, 2021)

Docket No. 19-4197-cv

SECURITIES AND EXCHANGE COMMISSION,

Plaintiff-Appellee,

v.

BARRY D. ROMERIL,

Defendant-Appellant,

PAUL A. ALLAIRE, G. RICHARD THOMAN, PHILIP D. FISHBACH, DANIEL S.

MARCHIBRODA, GREGORY B. TAYLER,

Defendants.

ON APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF NEW YORK

Before: LIVINGSTON, Chief Judge, AND CHIN AND BIANCO, Circuit Judges.
2

Appeal from an order of the United States District Court for the 

Southern District of New York (Cote, J.), entered November 18, 2019, denying 

defendant-appellant's motion pursuant to Federal Rule of Civil Procedure 

60(b)(4) for relief from judgment. In 2003, the Securities and Exchange 

Commission brought a civil enforcement action against defendant-appellant (and 

others) alleging securities fraud. To resolve the matter, defendant-appellant 

consented to the entry of a final judgment against him and agreed, inter alia, not 

to deny any of the factual allegations of the complaint. Almost sixteen years 

later, he sought to invalidate the judgment on the basis that it incorporated a 

"gag order" that violated the First Amendment and his right to due process. The 

district court denied the motion, and defendant-appellant appeals. 

AFFIRMED.

JEFFREY A. BERGER, Senior Litigation Counsel, for Robert 

B. Stebbins, General Counsel, and Michael A. 

Conley, Solicitor, Securities and Exchange 

Commission, Washington, D.C., for PlaintiffAppellee.

MARGARET A. LITTLE, Senior Litigation Counsel (Kara 

Rollins, Litigation Counsel, on the brief), New 

Civil Liberties Alliance, Washington, D.C., for 

Defendant-Appellant.
3

Paul R. Niehaus, Kirsch & Niehaus PLLC, New York, 

New York, and Rodney A. Smolla, Wilmington, 

Delaware, for Amici Curiae Alan Garfield, Burt 

Neuborne, Clay Calvert, Rodney Smolla, Reason 

Foundation, The Goldwater Institute, The Institute for 

Justice, and The Pelican Institute for Public Policy, in 

support of Defendant-Appellant.

Helgi C. Walker (Brian A. Richman, on the brief), Gibson, 

Dunn & Crutcher LLP, Washington, D.C., for 

Amicus Curiae The Competitive Enterprise Institute, 

in support of Defendant-Appellant.

Brian Rosner, Carlton Fields, P.A., New York, New 

York, for Amicus Curiae Americans for Prosperity 

Foundation, in support of Defendant-Appellant.

CHIN, Circuit Judge:

Almost sixteen years after entering into a consent agreement with 

the Securities and Exchange Commission (the "SEC") to resolve a civil 

enforcement action against him, defendant-appellant Barry Romeril moved to set 

aside the judgment incorporating the agreement, alleging that it contained a "gag 

order" that violated his First Amendment and due process rights. The district 

court denied Romeril's motion both on the grounds that it was untimely and on 

the merits, concluding that he had failed to allege a jurisdictional defect or 
4

violation of due process that would permit relief under Rule 60(b)(4) of the 

Federal Rules of Civil Procedure.

We do not reach the issue of the timeliness of the motion, for we 

agree with the district court that Romeril's motion fails on the merits because it 

does not allege a defect that would permit relief under Rule 60(b)(4). 

Accordingly, the district court's order denying the motion is AFFIRMED.

BACKGROUND

A. The SEC's "No-Deny" Policy

For many years the SEC has incorporated into its procedures 

governing the settlement of civil actions a rule barring defendants who enter into 

consent decrees from publicly denying the allegations against them. In 1972, the 

SEC announced that it would not approve agreements that allowed defendants 

to "consent to a judgment or order that imposes a sanction while denying the 

allegations in the complaint." 37 Fed. Reg. 25,224 (Nov. 29, 1972). This policy is 

codified at 17 § C.F.R. 202.5(e), which states as follows:

The Commission has adopted the policy that in any civil lawsuit 

brought by it or in any administrative proceeding of an accusatory 

nature pending before it, it is important to avoid creating, or 

permitting to be created, an impression that a decree is being 

entered or a sanction imposed, when the conduct alleged did not, in 

fact, occur. Accordingly, it hereby announces its policy not to 
5

permit a defendant or respondent to consent to a judgment or order 

that imposes a sanction while denying the allegations in the 

complaint or order for proceedings. In this regard, the Commission 

believes that a refusal to admit the allegations is equivalent to a 

denial, unless the defendant or respondent states that he neither 

admits nor denies the allegations.

Id. 

B. The Facts and Proceedings Below

In 2002, Xerox Corporation ("Xerox") entered into a consent decree 

with the SEC settling claims that it had violated securities laws. While it neither 

admitted nor denied the SEC's allegations, it agreed to pay a civil penalty of $10 

million and consented to an order enjoining it from future violations of securities 

laws. 

On June 5, 2003, the SEC filed a civil enforcement action in the 

Southern District of New York pursuant to Section 21(d) of the Securities 

Exchange Act of 1934, 15 U.S.C. § 78u(d), alleging that Romeril, the former Chief 

Financial Officer of Xerox, and other senior executives at Xerox violated

securities laws from 1997 to 2000 by manipulating Xerox's reporting of earnings 

to the SEC and investors. Specifically, the SEC alleged that Romeril "allowed 

Xerox to file public financial reports with the [SEC] that contained information 

that was not in conformity with [Generally Accepted Accounting Principles] . . . 
6

[and] failed to identify failures in Xerox's internal controls," and that he "engaged 

in other actions which caused the financial statements to be materially false and 

misleading." J. App'x at 16-17. 

Romeril settled with the SEC. While represented by counsel, he 

entered into a consent agreement (the "Consent") in which he conceded the

district court's jurisdiction over him and "the subject matter of th[e] action," and

agreed, "[w]ithout admitting or denying the allegations of the complaint," J. 

App'x at 67, to pay more than $5 million in disgorgement, prejudgment interest, 

and civil penalties.1 He also agreed to certain injunctive relief. The Consent 

contained the following provision:

Defendant understands and agrees to comply with the [SEC]'s 

policy 'not to permit a defendant . . . to consent to a judgment or 

order that imposes a sanction while denying the allegation in the 

complaint . . . .' 17 C.F.R. § 202.5. In compliance with this policy, 

Defendant agrees not to take any action or to make or permit to be 

made any public statement denying, directly or indirectly, any 

allegation in the complaint or creating the impression that the 

complaint is without factual basis. If Defendant breaches this 

agreement, the [SEC] may petition the Court to vacate the Final 

Judgment and restore this action to its active docket. Nothing in this 

paragraph affects Defendant's: (i) testimonial obligations; or (ii) 

right to take legal or factual positions in litigation in which the [SEC] 

is not a party.

1 Romeril was one of six Xerox executives who entered into consent agreements 

with the SEC and agreed to pay a total of $22 million. 
7

J. App'x at 70.

The parties presented the Consent to the district court, which then 

issued a Final Judgment (the "Judgment") on June 13, 2003. The Judgment 

incorporated the Consent "with the same force and effect as if fully set forth 

herein," and ordered Romeril to "comply with all of the undertakings and 

agreements set forth" in the Consent. J. App'x at 65. 

On May 6, 2019, nearly sixteen years after the Judgment was 

entered, Romeril moved in the district court for relief from the Judgment 

pursuant to Federal Rule of Civil Procedure 60(b)(4). He argued that the

Judgment was void because the provision barring public denials of the 

allegations against him -- in his words a "gag order" -- constituted a prior 

restraint that infringes his First Amendment rights and violated his right to due 

process. Specifically, Romeril argued that the provision deprived him of the 

right to "speak, write, or publish [his] account of the events leading to" his 

prosecution, to defend himself in the media, and to petition Congress and the 

SEC for securities law reform. J. App'x at 83. He contended further that he is 

unable "to exercise these rights of free expression" because the "gag order is 
8

worded so vaguely and reaches so broadly . . . that [he is] unable to speak 

without fear of a reopened prosecution." J. App'x at 82-83.

Together with the Rule 60(b)(4) motion, Romeril submitted a 

proposed amended Consent. The proposed amended Consent differed from the 

original Consent in only one material respect -- it omitted the no-deny provision. 

On November 18, 2019, the district court denied Romeril's motion on 

the grounds that the motion was untimely and that, on the merits, Romeril failed

to allege a jurisdictional defect or violation of due process that would render the 

Judgment void for purposes of Rule 60(b)(4). In particular, the district court 

concluded that (1) Romeril had acknowledged the court's jurisdiction over him 

and the subject matter of the action, (2) he failed to state a violation of his due 

process rights because he had notice and an opportunity to be heard and 

executed the Consent and waived his right to trial while represented by counsel, 

and (3) his constitutional claims did not "implicate" the court's jurisdiction to 

enter the Judgment. 

This appeal followed.
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DISCUSSION

"[W]e review de novo a district court's denial of a Rule 60(b)(4) 

motion." City of N.Y. v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 138 (2d Cir. 2011). 

A. Applicable Law

Rule 60(b)(4) authorizes courts to "relieve a party . . . from a final 

judgment" when "the judgment is void." Fed. R. Civ. P. 60(b)(4). "[A] void 

judgment is one so affected by a fundamental infirmity that the infirmity may be 

raised even after the judgment becomes final." United Student Aid Funds, Inc. v. 

Espinosa, 559 U.S. 260, 270 (2010). "The list of such infirmities is exceedingly 

short; otherwise, Rule 60(b)(4)'s exception to finality would swallow the rule." 

Id.; see 12 Moore's Federal Practice § 60.44[1][a] (2020) ("The concept of void 

judgments is narrowly construed."). 

Rule 60(b)(4) applies only in two situations: "where a judgment is 

premised either on a certain type of jurisdictional error or on a violation of due 

process that deprives a party of notice or the opportunity to be heard." Espinosa, 

559 U.S. at 271; see also Mickalis Pawn Shop, 645 F.3d at 138 ("A judgment is void 

under Rule 60(b)(4) . . . if the court that rendered it lacked jurisdiction of the 

subject matter, or of the parties, or if it acted in a manner inconsistent with due 
10

process of law." (internal quotation marks and citation omitted)).2 "A judgment 

is not void . . . simply because it is or may have been erroneous," and "a motion 

under Rule 60(b)(4) is not a substitute for a timely appeal." Espinosa, 559 U.S. at

270 (internal quotation marks and citations omitted). As for jurisdictional error, 

a judgment may be declared void for jurisdictional defect only "when there is a 

total want of jurisdiction and no arguable basis on which [the court] could have 

rested a finding that it had jurisdiction." Cent. Vt. Pub. Serv. Corp. v. Herbert, 341 

F.3d 186, 190 (2d Cir. 2003) (internal quotation marks and citation omitted). 

B. Application

We conclude that the district court's order denying Romeril's Rule 

60(b)(4) motion must be affirmed because he failed to show either a jurisdictional 

error or a due process violation within the meaning of the rule.3 We consider 

2 Romeril contends that Rule 60(b)(4) is not limited to these two situations, but he 

cites no authority for the proposition, and the settled law is to the contrary. See 

Espinosa, 559 U.S. at 271; Mickalis Pawn Shop, 645 F.3d at 138; Herbert, 341 F.3d at 190. He 

cites only Crosby v. Bradstreet Co., 312 F.2d 483 (2d Cir.), cert. denied, 373 U.S. 911 (1963), 

which, as we discuss below, pre-dates Espinosa, Mickalis Pawn Shop, and Herbert by 

many years and in any event does not require a different result. 

3 A Rule 60(b) motion must also be made "within a reasonable time." Fed. R. Civ. P. 

60(c)(1). Because Romeril's motion fails on the merits, we need not decide whether a sixteenyear gap between a judgment and Rule 60(b) motion is a reasonable time. We note that "this 

Court has been exceedingly lenient in defining the term 'reasonable time,' with respect to 

voidness challenges. In fact, it has been oft-stated that, for all intents and purposes, a motion to 

vacate a default judgment as void 'may be made at any time.'" "R" Best Produce, Inc. v. DiSapio, 

540 F.3d 115, 123-24 (2d Cir. 2008) (internal quotation marks and citation omitted).
11

first Romeril's claim of jurisdictional error and second his claim of due process 

violations.

1. Jurisdiction

Romeril has not established "a total want of jurisdiction." To the 

contrary, the district court clearly had jurisdiction over both the subject matter, 

see 15 U.S.C. §§ 78u, 78aa; 28 U.S.C. § 1331, and his person. Indeed, in the 

Consent, Romeril "acknowledge[d] having been served with the complaint in this 

action, enter[ed] a general appearance, and admit[ted] the Court's jurisdiction 

over [him] and over the subject matter of this action." J. App'x at 67. Rather, 

relying principally on one case, Crosby v. Bradstreet Co., Romeril argues that he is 

entitled to relief under Rule 60(b)(4) because the "gag order" was an 

unconstitutional prior restraint that violated the First Amendment and the 

district court therefore was "without power" to issue it. Appellant's Br. at 5-7.

As an initial matter, even assuming that Romeril is correct that the 

no-deny provision violates his First Amendment rights, his reliance on Rule 

60(b)(4) is misplaced. Even if the district court somehow erred in incorporating 

the no-deny provision into the Judgment, the Judgment was not void "simply 

because it is or may have been erroneous." Espinosa, 559 U.S. at 270; accord 
12

Nemaizer v. Baker, 793 F.2d 58, 65-66 (2d Cir. 1986) (judgment entered as result of 

"perhaps an erroneous exercise of federal jurisdiction" was not subject to 

collateral attack under Rule 60(b)(4)); In re Texlon Corp., 596 F.2d 1092, 1100 (2d 

Cir. 1979) ("The financing order was within the parameters of the bankruptcy 

court's authority, '[a]nd even gross error in the decree would not render it void.'" 

(citation omitted)). Any legal error here was not jurisdictional, for the district 

court had both subject matter and personal jurisdiction; hence, relief under Rule 

60(b)(4) was not available.

Moreover, we reject the claim that there was legal error, for the 

district court did not err in accepting a decree to which Romeril consented. The 

Judgment does not violate the First Amendment because Romeril waived his 

right to publicly deny the allegations of the complaint. A defendant in a civil 

enforcement action is not obliged to enter into a consent decree; consent decrees 

are "normally compromises in which the parties give up something they might 

have won in litigation and waive their rights to litigation." SEC v. Citigroup Glob.

Mkts., Inc., 752 F.3d 285, 295 (2d Cir. 2014) (quoting United States v. ITT Cont'l 

Baking Co., 420 U.S. 223, 235 (1975)). A defendant who is insistent on retaining 
13

the right to publicly deny the allegations against him has the right to litigate and 

defend against the charges. Romeril elected not to litigate.

In the course of resolving legal proceedings, parties can, of course,

waive their rights, including such basic rights as the right to trial and the right to 

confront witnesses. See Town of Newton v. Rumery, 480 U.S. 386, 393 (1987) ("[I]t is 

well settled that plea bargaining does not violate the Constitution even though a 

guilty plea waives important constitutional rights."); INS v. St. Cyr, 533 U.S. 289, 

321-22 (2001) ("Plea agreements involve a quid pro quo between a criminal 

defendant and the government. In exchange for some perceived benefit, 

defendants waive several of their constitutional rights (including the right to a 

trial) and grant the government numerous 'tangible benefits, such as promptly 

imposed punishment without the expenditure of prosecutorial resources.'"

(citations omitted)). The First Amendment is no exception, and parties can waive 

their First Amendment rights in consent decrees and other settlements of judicial 

proceedings. See United States v. Int'l Brotherhood of Teamsters, 931 F.2d 177, 188 

(2d Cir. 1991) (holding that union waived claim that restrictions in consent 

decree on publication of materials for union elections violated First Amendment 
14

because it consented to provision in consent decree).4 To the extent Romeril had 

the right to publicly deny the SEC's allegations against him, he waived that right 

by agreeing to the no-deny provision as part of a consent decree. 

Romeril relies on our decision in Crosby. There, we held that the 

district court erred in denying a Rule 60(b) motion to vacate an order entered 

years earlier as part of the settlement of a libel action, on the ground that the 

district court was "without power" "to enjoin publication of information about a 

person, without regard to truth, falsity, or defamatory character of that 

information." 312 F.2d at 485. We explained:

Such an injunction, enforceable through the contempt power, 

constitutes a prior restraint by the United States against the 

publication of facts which the community has a right to know and 

which [the defendant] had and has the right to publish. The court 

was without power to make such an order; that the parties may have 

agreed to it is immaterial.

4 See also, e.g., Leonard v. Clark, 12 F.3d 885, 889 (9th Cir. 1994) ("First Amendment 

rights may be waived" as part of settlement as long as that "waiver is knowing, 

voluntary and intelligent."); In re George F. Nord Bldg. Corp., 129 F.2d 173, 176 (7th Cir. 

1942) ("Certainly, one who has been a party to a proceeding wherein a consent decree 

has been entered and who has been a party to that consent, is in no position to claim 

that such decree restricts his freedom of speech. He has waived his right and given his 

consent to its limitations within the scope of that decree."); accord Snepp v. United States, 

444 U.S. 507, 509 n.3 (1980) (per curiam) (rejecting claim that provision in employment 

agreement obligating employee to submit any proposed publication for prior review 

constituted unconstitutional "prior restraint on protected speech," where employee 

voluntarily entered into agreement); Ronnie Van Zant, Inc. v. Cleopatra Recs., Inc., 906 

F.3d 253, 257 (2d Cir. 2018) (per curiam) ("parties are free to limit by contract 

publication rights otherwise available").
15

Id.

While Romeril's reliance on the decision, in light of this broad 

language, is understandable, Crosby does not control this case. First, it was 

decided more than fifty years ago, long before Espinosa and the other cases 

discussed above limited the grounds for relief under Rule 60(b)(4).5 Second, 

Crosby is distinguishable, as the rights of non-parties were implicated by the 

prohibition on public comment at issue in the case. 

Stanford Crosby ("Stanford") brought a libel action against Dun & 

Bradstreet ("D&B"), "the well-known . . . credit information company." Id. at 484. 

Stanford and D&B settled. Their settlement stipulation, which was so ordered by 

the district court, prohibited D&B from reporting not only about Stanford but 

also about his brother Lloyd Crosby ("Lloyd") as well as certain specified other

individuals with whom Stanford and Lloyd had been in business. Id. The 

provision barred D&B "from issuing or publishing any report, comment or 

5 We note that the movant in Crosby did not seek relief under Rule 60(b)(4). 

Rather, he moved under Rules 60(b)(5) and (6). As they existed then, subdivision (5) 

permitted a court to relieve a party from final judgment if "it is no longer equitable that 

the judgment should have prospective application," and subdivision (6) permitted a 

court to do so for "any other reason justifying relief from the operation of the 

judgment." Crosby, 312 F.2d at 484 n.2 (quoting Fed. R. Civ. P. 60(b)(5), (6)). The Court, 

however, apparently on its own initiative, relied on Rule 60(b)(4). Id. at 485.
16

statement either in writing or otherwise concerning" Stanford, Lloyd, and the 

other individuals, "or concerning the business activities of any of the foregoing 

persons[,] . . . whether present, past or future." Id. (internal quotation marks 

omitted). 

Some thirty years after the case was settled, Stanford moved to 

terminate the order, apparently because the absence of a credit listing by D&B 

was making it difficult for him to get credit. The brothers had severed their 

business relations, however, and were competing against each other; Lloyd 

contended that Stanford's purpose in seeking to terminate the order was to 

"destroy his business," and thus he opposed the motion. D&B did not oppose 

termination as long as it could refer to Lloyd in its reports about Stanford. Id. 

The Court reversed the order. Although the Court did not explicitly 

frame its reasoning in these terms, the disputed provision barred D&B from 

making statements not only about Stanford (the only plaintiff in the case), but 

also about Lloyd and other individuals who were not parties to the litigation that 

led to the order. In that sense, the district court lacked jurisdiction over these 

other persons, who were not before the court and likely had not had notice of the 

proceedings or an opportunity to be heard. See Texlon Corp., 596 F.2d at 1099 
17

("[A] judgment . . . is void . . . if the court that rendered it lacked jurisdiction . . . 

of the parties." (citation omitted)). Here, the Judgment affected only Romeril, 

who was before the court and had an opportunity to be heard.6 Hence, Crosby

does not control, and we agree with the district court that Romeril did not 

establish "a total want of jurisdiction" rendering the Judgment void. 

2. Due Process

Romeril contends that his right to due process was violated in 

several respects: the "gag order" is unconstitutionally vague; the SEC lacked 

statutory authority to issue the "gag order"; the "gag order" silences him in 

perpetuity; and the "gag order . . . implicates the judiciary in violating the 

constitution." Appellant's Br. at 52. We are not persuaded.

6 The SEC also argues that Crosby is distinguishable because the Court there relied 

on the rule that "a court in 'equity ha[s] no jurisdiction to enjoin a libel,'" and noting that 

the present case does not involve an injunction against a libel. Appellee's Br. at 13 

(quoting Am. Malting Co. v. Keitel, 209 F. 351, 354 (2d Cir. 1913)); see Northridge Church v. 

Charter Twp. of Plymouth, 647 F.3d 606, 612 (6th Cir. 2011) (holding that "Crosby rested on 

a unique jurisdictional issue that rendered the court entering the order without power to 

do so," citing general rule that court of equity will not enjoin publication of libel). We 

need not reach this argument, but we note that the Court in Crosby set aside the 

judgment even assuming that "it is proper for a federal court to enjoin a libel," and 

observed that the order in question was not directed solely at defamatory statements. 

312 F.2d at 485.
18

First, the due process right implicated by Rule 60(b)(4) is the right to 

"notice 'reasonably calculated, under all the circumstances, to apprise interested 

parties of the pendency of the action and afford them an opportunity to present 

their objections.'" Espinosa, 559 U.S. at 272 (quoting Mullane v. Cent. Hanover Bank 

& Trust, 339 U.S. 306, 314 (1950)). As a general matter, there is no "denial of due 

process for purposes of Rule 60(b)(4) if the party seeking relief received actual 

notice of the proceedings and had a full and fair opportunity to litigate the 

merits." 12 Moore's Federal Practice Civil § 60.44[4]; see Espinosa, 559 U.S. at 276. 

The due process right implicated by Rule 60(b)(4) does not extend to the claims 

of due process asserted by Romeril here. Romeril had actual notice of the 

proceedings as well as a full and fair opportunity to litigate on the merits. He 

participated in the proceedings while represented by capable and experienced 

counsel. 

Second, there is no merit in any event to Romeril's claims of a 

violation of due process, for he willingly agreed to the no-deny provision as part 

of a consent decree. While he waived certain rights, including the right to trial 

and the right to publicly deny the allegations against him, he eliminated the 

expense of further litigation and the risk of an adverse judgment, including 
19

higher monetary penalties and judicial findings that he had violated securities 

laws. We see no basis for not enforcing the Consent and Judgment as written. 

See Citigroup Glob. Mkts., 752 F.3d at 293 ("Our Court recognizes a 'strong federal 

policy favoring the approval and enforcement of consent decrees.'" (quoting SEC 

v. Wang, 944 F.2d 80, 85 (2d Cir. 1991))). Romeril cannot complain now, on postjudgment, collateral review, that the provision violates his right to due process.

CONCLUSION

For the reasons set forth above, the district court's order is 

AFFIRMED.