FOR PUBLICATION



### UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

M E L I S S I A H E

N S ON ; KE I T H T UR

NE R , Plaintiffs-Appellants
,

v

.

F I D EL I TY N AT I ON

AL F I N A N C IAL , I N C ., Defendant-Appellee. No. 18-56071

D.C. No. CV 14-1240 ODW

OPINION

Appeal from

the United States District Court for the Central District of California Otis D. Wright II, District Judge, Presiding

Argued and Subm itted June 10, 2019 Anchorage, Alaska

Filed Novem

ber 15, 2019

Before: A. W allace Tashim a, W illiamA. Fletcher, and Marsha S. Berzon, Circuit Judges.

Opinion by Judge Tashim aH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 2

SUMMARY *

Motion for Relief from J udgment

The panel reversed the district court’s order d e ny ing plaintiffs’ Fed. R. Civ. P. 60(b)(6) m otion fo r re lief from judgm ent i n an action under the R eal Estate Settlem ent Procedures Act.

Plaintiffs sought relief from judgm ent based on an intervening change in the law in Microsoft Corp. v

. Ba k er , 137 S. Ct. 1702 (2 0 17) (holding that plaintiffs in putative class actions cannot transform a tentative interlocutory order into a final appealable judgm ent sim ply by dism issing their claim s with p rejudice). The panel addressed the analysis that
courts s h o u ld em

ploy to guide their d iscretion when evaluating the m erits of a Rule 60(b)(6) m otion on the ground of an intervening change in the law i n a non-habeas corpus

case. The panel held that m any of th e fa c tors set o ut in Phelps v. Alameida
, 569 F.3d 1 120 (9th Cir. 2009), a habeas
case, are relevant, but courts m ust consider all of the relevant circum stances surrounding a specific m otion.

The panel exam ined the district court’s analysis o f the six Phelps f actors, including the nature of the change in the law, plaintiffs’ diligence in pursuing relief, the parties’ reliance interest in the finality of the case, the de l ay between the judgm ent an d th e R

u le 6 0 (b ) m otion, the relationship between the original judgm ent and the change in the law, and com ity

concerns. The p an el also ex amin ed ad d itio n al considerations,

* This summ ary constitutes no part of the opinion of the court. It h as been prepared by court staff for the convenience of the reader.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 3

such as the im

portance of heeding the intent of the rulings o f
the federal appellate courts, how best to stay true to th e Suprem e Court’s reasoning in Microsoft
, and the negotiated
nature of the voluntary dism issal in this case. Th e pan el concl u d e d that the district court’s denial of plaintiffs’ Rule 60(b)(6) m otion was an abuse of discretion because it rested
upon an erroneous view of the law as t o s everal significant factors, an d g r anting relief was appropriate. The panel reversed and rem anded with directions t o grant the Rule 60(b)(6) m otion and for further proceedings.

C OUNSEL

C yril V

. S m ith (argu ed), Z uckerm an Spaeder L L P
, B altimo re, Maryland; Taras Kick and Robert J. Dart, The Kick Law Firm APC, Los Angeles, California; for Plaintiffs-Appellants.

Michael J. Gleason (argued), Hahn Loeser & Parks LLP, San San Diego, California, for Defendant-Appellee.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 4

OPINION

TASHIMA, Circuit Judge:

Federal Rule of Civil P rocedure 60(b)( 6 ) is a grand reservoir of equitable power that allows courts to grant relief from a final judgm ent for “any” reason that “justifies relief.” Fed. R

. Civ. P. 60(b)(6). In Phelps v. Ala me ida
, 569 F.3d 1120, 1135–40 (9th Cir. 2009), we set out the analysis that
courts should emp l oy to guide their d iscretion when evaluating the m erits of a Rule 60( b) ( 6 ) m otion that seeks relief from the dism issal of a habeas corpu s p e ti t ion on the ground of an intervening change in the law. However, we explicitly left open the ques t i o n of whether the sam e Rule 60(b)(6) fact o r s we identified in Phelps are also applicable beyond the h ab eas corpus context. See id. at 1135 n.19. Confronted w ith the appeal of a district court’s denial of a Rule 60(b)(6) m o tio n th at w as also predicated on an intervening change in the law, b ut in a n on-habeas case that entails entirely differ e nt circum stances than did Phelps
, we

now begin to an s wer that question. While we conclude that

m any o f th e Phelps factors are relevant to the Rule 60(b)(6)

an a l y sis in the present context, we reem phasize that courts

m ust consider all of the relevant circum stances surro unding the specific m otion before the co urt i n o rder to ensure that justice be done in light of all the facts. S ee id. at 1133.

I

On September 9
, 2013, Plaintiffs-Appellants Melissia Henson and Keith Turner (collectively “Plaintiffs”), two individuals who participated in separate real e s t ate transactions, filed this p utative class action lawsuit against Defendant-Appellee Fidelity N ational Fi nancial, Inc.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 5

(“Fidelity”). Plaintiffs claim ed that Fidelity’s practice o f receiving paym ents f

rom three overnight delivery vendors, in exchange f

or referring docum ent delivery business t o those vendors in connection with the settlem ent of federally related

m ortgage loans, violated § § 8(a) and 8 (b) of the Real Estate Settlem ent Procedures Act (“RESPA”), Pub. L. No. 9 3-533, 88 Stat. 1724, 12 U.S.C. § 2607.

Fidelity m o ved to d ism iss the com plaint, and the district
court granted the m otion as to all claim s except for T urner’s claim under RESPA § 8(a). T h e district court dism issed all of Henson’s claim s on statute of lim itations grounds, and also dism issed with prejudice b oth H enson’s and Turner’s claim s under RESPA § 8 (b) for f ailure to state a claim

. After filing

an answer, Fidelity m oved for judgm ent on the pleadings with respect to Turner’s rem aining claim under RESPA § 8 (a), but the district court denied that m otion.

Turn e r subsequently m oved for class certification. A week later, Turner mo ved in the alternative to continue the hearing on class c e rt ification in order to allow discovery on class certificatio n issues. The district court denied both the discovery and class certification m otions, finding th at class

m em ber-specific q

uestions would predom inate over any class-wide inquiries.

Pl aintiffs then entered into a detailed, negotiat e d stipulation of dism issal with Fideli ty. Relying o n Ninth Circuit precedent that perm itted a p laintiff to obtain appellate

r e v iew of certain interlocutory orders, including an or d e r denying class certification, by d ism issing any active claim s with p rejudice, Plainti ffs agreed to voluntarily dism iss the

case with prejudice so that they could appeal both the district court’s denial o f class certification and the partial grant o f theH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 6

m otion to dism iss. S

ee Omstead v. Dell, Inc.
, 594 F.3d 1081, 1085 (9th Cir

. 2010) (“[A] plaintiff that deem s an interlocutory ruling to be so pre judicial as to deserve imme d i at e review

. . . has the alternative of dism issing the

com plaint voluntarily w ith prejudice.” ) (citation omitted);

see also Be r

ger v. Home Depot USA, Inc.
, 741 F.3d 1061, 1065 (9th Cir. 2014) (“[A] dism is s a l o f an action with prejudice, even when such di s mi s s a l is the product of a

s t i p u l a t i o n , i s a s u f f i c i e n t l y a d v e r s e

— a n d t h u s appealable—final decision.”)

. The stipulation provided:

Plaintiffs Keith Turner and Mel i s sia Henson and Defend ant Fidelity National Financial, Inc., through their undersigned counsel, hereby stipulate to request dism issal of the above-cap t ioned case with prejudice pursuant to Federal Rule of Civil Procedure 41(a)(2), and further stipulate that:

Th e parties understand that plaintiffs Turner and Henson wil l fi l e an appeal to the dism issal in order to appeal certain o f the Court’s o r ders, including its order denying

c lass certification and its order granting ( i n part) defendant’s m o tion to dism iss. See Omste a d v

. Dell, Inc.
, 594 F.3d 1081, 1085 (9th Cir. 2010). If the orders appea l ed are affirm ed, plaintiffs w ill take nothing by way of their com

p l a i nt. By stipulating to this dism issal, [Fidelity] does not agree that such

a d ism issal establishes appellate jurisdict i o n and does not wa i ve its ability to challenge appellate jurisdiction.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 7

The p arties stipulate that b y Pla i n t iffs voluntarily dism issing th eir claim s with prejudice, the Court’s April 2 9, 2014 order on Defendant’s Motion for Judgm ent on th e Pleadings is not a final judgm ent and shall not provide a basis f

or collateral estoppel against Defendant in subsequent litigation.

Plaintiffs agree to reim burse [Fidelity] $837.96 for certain costs that it h as incurred in this action through the date of the filing o f this stipulation . . . .

It is further agreed that if Plaintiffs o r Plaintiffs’ counsel should re-file the claim s at issue in this lawsuit or file a different lawsuit based on the sam e claim s and conduct on behalf of a different Plaintiff(s), any such

c la im s will be filed in the District Court fo r the Central District of California.

The district court entered the parties’ proposed order and dism issed the com

plaint with prejudice on the term s provided in the stipulation. Hen s on and Turner then tim ely filed separat e n o tices of appeal from the final dism issal order. Both n o t i ces of appeal specifically identified the order granting in part Fidelity’s m otion to d ism iss (as to Henson’s claim s and the RESPA § 8(b) claim s), and the order denying class certification, as o rders included in the final judgm ent to be reviewed on appeal.

After Henson’s and Turner’s appeals were fully b riefed, but b efore they were calendared for oral argum ent, the cases

were s t ayed pending the United S tates Suprem e Court’sH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 8

decision in M

i c r osoft Corp. v. Baker
, because that case appeared poised to address som e of the appellate jurisdiction questions raised by Fidelity in Henson’s and T urner’s appeals. In Microsoft
, the d istrict court had sim ilarly granted

a stipulated m otion to dism iss with prejudice. The parties h ad entered into the stipulation so that the p laintiffs could seek imm ediate appeal o f the district court’s earlier order striking

consum ers’ class allegations. See Microsoft Corp. v. Baker
, 137 S. Ct

. 1 7 0 2
, 1706–07, 1711–12 (2017). Under the stipulation, the plaintiffs had “reserved the righ t t o revive their claim s should the Court of Appeals reverse the District Court’s certification denial.” Id. at 1707. On appeal, howeve r, Microsoft had challenged appellate jurisdiction, arguing that the volunt ary dism issal could not support appellate review of the district court’s interlocutory order
str iking class allegations. Id. at 1 711. The Ninth Circuit rejected Micro soft’s argum ent, holding that it had jurisdiction
t o entertain the appeal under 28 U.S.C. § 1291. Id

. at 1711–12.

On June 1 2, 2017, near l y three years after Plaintiffs h ad filed their stipulated voluntary dism issal, the Suprem e Court issued its decision in Microsoft

. The C o urt h e ld that “[p]laint i ffs in putative class actions cannot transform a tentative interlocutory order into a f inal judgm ent within the

m eaning o f § 1291 sim

ply by dism issing their claim s with
pre j u d ice—subject, no less, to the right to ‘revive’ those

c laim s if the denial of class certification is reversed on appeal.” Id. at 1715 (citations om itted). The Court explained that the tactic of using a stipulated voluntary dism issal to seek imm ediate review of an order denying class certification “underm ine[s] § 1291’s firm finality principle” and subverts Federal Rule of Civil Procedure 2 3(f), which gives appellate
courts discre t i o n to choose whether to perm it imm ediateH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 9

appeals o f interlocutory class certification orders. S e e id.
at 1707, 1712–15. In so h olding, the Suprem e Court reversed the Ninth Circuit’s rule—on which He n s on and Turner h ad relied—that a stipulated voluntary dism issal of a class action

was a s ufficiently adverse final order, as long as the individual plaintiffs’ cases had n ot settled, t o g ive rise to appellate jurisdiction to revie w a d istrict court’s denial o f class certification. S

e e Baker v. Microsoft C

orp. , 797 F.3d 607, 612 (9th Cir. 2015); see also B erger , 741 F.3d at 1065.

In light of Micr o soft
, F idelity m oved to dism iss both Henson’s and Turner’s appeals. Fid e lity argued that the Suprem e Court’s rule in Microsoft applied directly and deprived the Ninth Circuit of jurisdiction over T urner’s appeal from the denial of class certification. And F idelity
sug g e s t e d that the Ninth Circuit also lacked jurisdiction to hear Henson’s appeal from the district court’s dism issal order because the Suprem e Court’s rule in M icrosoft applied beyond the class certificati o n context and m eant that a voluntary dism issal could never constitute a f inal o rder under § 1291.

In response, Plaintiffs argued that their case was factually distinguishable from Microsoft b ecause, before the stipulated voluntary dism issal of the single rem aining claim
, the district
court had already involuntarily dism issed all of Henson’s claim s and o ne of Turner’s claim s. Plaintiffs m aintained that the Ninth Circuit had jurisdiction over their appeals because Microsoft d id not o v errule cases f rom “[e]very circuit
perm it[ting] a plaintiff, in at least so me c i rcum stances, voluntarily to dism iss rem aining claim s or rem aining parties from an action to conclude the whole case in the district court and ready it for appeal.”H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 10

A Ninth Circuit m otions panel sub s e qu ently entered identical o rders in Henson’s and Turner’s appeals, de nying Fidelity’s m otions to dism iss and rem anding to the district court. The orders stated:

Ap pellee’s m o tion to dism iss this appeal

. . . is denied. I n light of the Suprem e C ourt o f the United S tates’ decision in Microsoft Corp.

v. Baker
, the court sua sponte rem ands this

case to allow the parties to seek appropriate relief in the district court in the first instance. See Microsoft Corp. v. Baker
, 137 S. Ct. 1702, 1715 (2017). 1

On rem and, Fidelity refused to stipul at e that the case should proceed before the district court on Turner’s RESPA § 8(a) claim
, which had survived Fidelity’s m otion to dism iss and m otion for jud g ment on the p leadings, but which h ad been voluntarily dism issed pursuant to the stipulation. As a result, Plaintiffs m oved to vacate the p rior dism issal p ursuant to Federal Rule of Civil Procedure 60(b)(6).

In their Rule 60(b) m otion, Plaintiffs argued th at their circum stan c es, including Microsoft ’s intervening change in
the law, entitled them to relief from judgm ent under the factors set out in Ph e l

p s , 5 69 F.3d at 1135

–40, which addressed Rule 60(b)(6) relief in l i g h t of an intervening change in the law. In addition, Henson argued that even if the

1 The Suprem e Court in Micr o s o f t had also rem anded the case “for further proceedi n g s consistent with this opinion.” Microsoft
, 137 S. Ct.
at 1715; see also Baker v. Microsoft Corp.
, 884 F.3d 811
, 8 1 2 ( 9 th Cir. 2018) (rem anding to the d istrict court “ for further proceedings consistent with the opinion of the Suprem e Court”).H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 11

district court declined to vacate the dism issal order and revive the entire case, it should nonetheless grant h er m ore lim ited relief by entering a new final judgm ent from which she could appeal the court’s earlier involuntary dism issal of her claim s, because the Ninth Circuit h ad not addressed the m erits of her
p ri o r appeal and it w ould be m anifestly unjust under th e circum stances to nullify her right to appeal altogether.

Th e district court d enied the Rule 60(b) m otion. Applying the Phelps fram ework to the intervening change o f law argum ent, the district court ruled that the six f actors set out in Phelps did not warrant relief. T h e district court did not address H enson’s separate argum ent that denying her relief from judgm ent would have the e ffect of unfairly nullifying her right to appeal the district court’s earlier involuntary dism issal of her claim s. Plaintiffs tim ely appealed.

II

W e have jurisdiction under 28 U.S.C. § 1291, and we review the denial of a m otion for relief from judgm ent under Rule 6 0 ( b ) fo r an abuse of discretion. Phelps
, 569 F .3d at 1131. “[T]he district court necessarily abused its d i s c retion if its denial ‘rested upon an erroneous v iew of the law,’” id. (quoting Faile v. Upjohn Co.
, 988 F.2d 9 85, 986–87 (9th Cir. 1993)), o r on a “clearly erroneous finding of m aterial f act,” Casey v. Albertson’s, Inc.
, 362 F.3d 1254, 1257 (9th Cir. 2004). Otherwise, we m ay not reverse “absent a definite and firm conviction that the district court comm itted a clear error of judgm ent in the conclusion it reached upon a weighing o f relevant factors.” Valdivia v. S chwarzenegger
, 599 F.3d 984, 988 (9th Cir. 2010).H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 12

III

Rule 60(b)(6) provides that, “[o]n m otion and just term s, the court m ay relieve a party or its legal representative from

a final judgm ent, o rder, or proceeding for

. . . any

. . . reason that justifies reli e f. ” 2 Fed. R. Civ. P. 60(b)(6). T his clause “gives the district court power to v acate ju d g m ents ‘whenever such action is appropriate to ac com plish justice.’” United States v. Sparks
, 685 F.2d 1128, 1 1 3 0 ( 9 th Cir. 1 982) (quoting Klapprott v. United States
, 335 U.S. 601, 615 (1949)); see also F

leming v. Gulf Oi l Corp.
, 547 F.2d 908, 912 (1 0 th Cir. 1977) (explaining that K lapprott
, 335 U.S.
at 614, shows that, “[l]ike R ule 60(b) ge n er a l l y, clause (6) should be liberally applied to situations not covered by the preceding five clauses so that, giving due regard to the sound interest underlying the f inality of judgm ents, the district court, nevertheless, has power to grant relief from a judgm ent whenever, under al l th e surrounding circum stances, such action is appropriate in the furtherance of ju s t ice” (quoting 7 Moore’s Federal Practice at 3 42–43 (2d ed. 1975))). However, “[a] m ovant seeking relief under Rule 60 ( b )(6)

m us t show ‘“extraordinary circum stances” justifying the reopening of a final judgme n t

. ’ ” Jones v. Ryan
, 733 F.3d 825, 833 (9th Cir. 2013) (quoting G onz a l e z v

. Crosby
, 545 U.S. 524, 535 (2005)).

Plaintiffs argue that the effect o n their case of Microsoft ’s intervening c h ange in the law presents extraordinary circum stances warranting rel i e f. They p oint to the fact that

2 As relevant here, a voluntary dism issal qualifies as a “ judgm ent, order, or proceeding from which Rule 60(b) relief can be granted.” Kalt

v. Hunter (

In re Hunter)
, 66 F .3d 1 00 2
, 1004 (9th Cir. 1995) (citations

om itted).H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 13

Microsoft ’s intervening change in the law caused the Ni n th Circuit to rem and rather than address the merits of their appeals, and that d enying relief from judgm ent would therefore convert the stipulation—entered into th r ee years before Microsoft and “intended to be a conditional dism issal (to allow appellate review)”—into an “irrevocable” dism issal without any opportunity f o r appellate review on the m erits. 3 I n other words, denying Rule 60(b) relief would treat th e voluntary dism issal, which was intended to facilitate appellate review, as a f

inal adjudication of the e ntire case,

even though there had been and was to be no appellate review

3 Plaintiffs argued i n the district court that these circum stances are all the m ore extraordinary because of their tim ing. They explained:

The appeal ha d b ee n fully briefed before the Ninth Circuit m onths before the Suprem e C ourt granted certiorar i i n Microsoft

. The timing of the Suprem e Court’s ruling in M

icrosoft deprived the Ninth Circuit of jurisdict i o n over Plaintiffs’ appeal at the absolute
worst tim e. Had it been issued earlier, Plaintiffs would have never agreed to dism i ss their claim s

. La ter, and Plaintiffs’ appeal of the District Court’s denial of class certification w ould have been resol v e d on the m erits. Instead, Plaint i ffs were caught in a sm all window o f tim e, w ith their appeal pending, where the abrogation of Omstead
, Berger
, and Baker t hreatens to deny them their right to appeal the Court’s rulings altogether. I n other words, the in te rv e ning change in law, and the timing of that change
, have worked together to threaten truly catas trophic dam age to Plaintiffs’

c laim s—leaving Plaintiffs deprived of their right t o appeal the class certification ruling altogether, as well

as depriving Plaintiff Henson o f her right to appeal the District Court’s order d ism issing all of her claim s based upon the statute of limi tations. This is exactly the sort of “extraordin ar

y ci r cu m s t a n ce” w ar r ant i n g relief under Rule 60(b)(6).H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 14

of the issues the district court h a d decided, then or later. Doing so woul d en d th e case in a m anner that deprives Plaintiffs of any opportunity to obtain appellate review of the district court’s earlier dism issal and class certification orders, because Plaintiffs’ tim e to appeal the original judgm ent has
run, and an appeal from the denial of a Rule 6 0(b ) m otion brings up for review only the den i a l o f that m otion, b ut not the underlying judgm ent

. 4 See Fed. R. App. P

. 4(a)(1)(A); Harman v. Ha r

p e r , 7 F.3d 1455, 1458 (9th Cir. 1993). Plaintiffs therefore contend t h at Microso

ft ’s change in the law provides a basis under Rule 60(b)(6) for vacating the voluntary dism issal order.

W e h ave previously reco g n ized that a change in the

con tr ol ling law can— but does n o t always—provide a sufficient basis for granting relief under Rule 60(b)(6 )

. See Phelps
, 569 F.3d at 1132–33. To assess a Rule 60(b)(6)

m otion “predicated on an intervening change in the law,” a district court m

ust “eva l uate the circum stances surrounding the specific m otion before the court.” Id. at 1133. This “case-by-case inquiry

. . . requires the trial c o urt to intensively balance numerous factors, including the

com peting pol icies of the finality o f judgm ents and the incessant comm and of the court’s conscience that just i ce be done in light of all the facts.” Id. (quoting Stokes v. Williams
, 475 F.3d 732, 736 (6th Cir. 2007)).

In Ph e lps
, in the context of a Rule 60(b) m o tion that

s o ught relief from the d ism issal of a habeas petition o n th e

4 The Federal Rules p rovide an exception to this rule by extending the tim e to appeal from the judgm ent if the Rule 60 m otio n is filed within 28 days of entry of judgm ent, but that exception d oes not apply here. See Fed. R. App. P. 4(a)(4)(A)(vi).H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 15

basis of a change in the law, we identified six factors as being “well-reasoned principles that should guide courts in exercising their discretion under Rule 60(b)(6).” Id. at 1140. W e cautioned, however, that our discussion o f those fac t o rs

was not m eant to “im

pose a rigid or exhaustive c h ecklist,” because “‘Rule 60(b)(6) is a grand reservoir of e qu i t ab le power,’ and it affords courts the discretio n and power ‘to
vacate judgm ents whenever su ch action is appropriate to

accom p lish ju st i c e

. ’” Id. at 1135 (first quoting Harrell v. DCS E quip. L easing Corp.
, 951 F.2d 1453, 1458 (5 th Ci r. 1992); then quoting Gonzalez
, 545 U.S. at 542). Moreover,

we noted that “while som e o f the factors we em phasize here

m ay be useful in contexts other th an th e one before us, we express no opinion on their applicability vel non beyond the
scope of h abeas corpus.” Id. at 1135 n.1 9 ( i t a lics om itted);

see also Jones
, 733 F.3d at 839 (“[The Phelps ] factors are particularly useful when, as here, we are asked to apply Rule 60(b)(6) to a rejected petition for habeas corpus.”).

The district court h e r e nevertheless analyzed the six Phelps facto rs, and only those factors, in the instant nonhabeas co ntext to determ ine whether the circum stances of this
case, including the change in the controlling law effected by Microsoft
, w ere sufficiently extraordinary t o warrant relief under R ule 60(b)(6). W eighing all those “relev ant” factors
t o g e th e r , th e d i s tr i c t c o urt “ c o n c l u d e [ d ] th a t th e circum stances d [ id] not w arrant relief pursuant to Rule 60(b)(6).”

Plaintiffs argue o n app eal that the district court’s denial of Rule 60( b)(6) relief constituted an abuse of d iscretion. They contend that the district court erred in its analysis of the Phelps change-in-the-law factors b y assum ing that Plaintiffs

were at fault for their predicam ent, and therefore by “[giving]H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 16

no w eight to, or even count[ing] against them
, [Plaintiffs’] legitim ate reliance on the settled law of this Circuit and [the Ninth Circuit’s] decision to rem and rather than to dism iss the appeals.” According to Plaintiffs, the district court’s flawed

assum ption—contrary to the term s of the p art i es’ stipulation—that Fidelity was entitled to rely on th e finality of the judgm ent, based on the expectation that Ninth Circuit precedent w ould be overruled, tainted the d i s trict court’s analysis of three of the six Phelps factors. 5

To determ ine whether the district c o urt abused its discretion and to d em onstrate the case-by-case inquiry required by Rule 6 0(b)(6), we e x am i n e the district court’s analysis of each of the Ph elps factors sereatim

. In doing so,

we address the q

uestion left open by Phelps : th e extent to which, and in what m anner, those f actors m ay be relevant to assessing a Ru l e 60(b)(6) m otion in a n on-habeas context. Relatedly, we also highlight additional con siderations, such

as the im

port of Microsoft ’s reasoning and the parties’ stipulation, that are not addressed by the Ph e lps factors, but that nonetheless are relevant to the Rule 60(b)(6) determ ination in this ca s e

. S e e Phelps
, 569 F.3d at 1133 (directing that courts evaluate all the circum stances

5 Henson also arg ue s th at, as to her specifically, the district court abused its discretion by denying her relief from judgm ent without addressing her argum ent that denying relief would have the effect o f stripping her of the right to appeal t he court’s earlier involuntary d ism i ssal of her claim s, notwithstanding the fact that she had tim ely appealed t o the Ninth Circuit and found herself in this unusual procedural posture through

no fault o f her o w n s i m p ly because her appeal of the dism issal order becam e entangled with Turner’s appeal of t he class certification denial. This argum ent m ay well h ave m erit, b ut because the chan g e -in-law
argum ent i s dispositive as to both Henson and Turner, we need n ot address it.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 17

surrounding the specific R ule 6 0 (b)(6) m otion b efore the court). W e note that particularly where
, a s here, a district
court is faced with applying our previously-discuss e d Rule 60(b)(6) f actors in an entirely new context, the court should

assess how that different context m ight alter the calculus o f the f actors’ application, and whether those factors adequately capture all of the relevant circum stances. As we em phasized in Phelps
, the factors identified in that case were not intended
t o b e a rigid or exhaustive list; a court’s ultim ate char g e i n

e valuating a Rule 60(b)(6) m otion rem ains to “intensively balance” all the relevant factors, “including the com peting policies of th e fi n ality of judgm ents and the incessant

comm an d o f the court’s conscience that justice b e done in light of all the facts.” See id. at 1133, 1135.

1. The Change in the Law

The first Phelps f

a c t o r considers the nature of the intervening change in the law. See id. at 1135–36; see also Jones
, 733 F.3d at 8 3 9

. Fo r exam ple, in Phelps we had to decide whether to gran t r e l ief f rom dism issal of a habeas
pe ti t ion where, fifteen m onths after the p etitioner’s unsuccessful appeal o f the d ism issal becam e final, the Ninth Circuit favorably changed th e l aw on which the petition’s dism iss al h ad been predicated. 569 F.3d at 1126–27, 1131. W e determ ined that the p ost-judgm ent “change in the law

. . . did not u pset o r overturn a settled legal principle” because “the law in o ur circuit was d e cidedly un settled at the tim e Phelps’ habeas petition was before the district court.” Id. at 1136 (italics om itted). W e concluded that this circum stance favored granting relief, because it m eant that the dism issal o f Phelps’ petition h ad not been based on a “prevailing interpretation” of the relevant statute, and in fact the change in the law adopted the legal position that Phelps h adH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 18

unsuccessfully advocated all along in his habeas proceedings. See id.

W e see no reason why su c h equitable considerations related to the nature of the change in the law would not also b e r e levant to assessing whether R ule 60(b)(6) relief i s warranted in a non-habeas context. W e note , h o wever, that the circum stances of the instant case are nearly the opposite of those considered in Phelps

. Rather than seeking the b enefit of a favorable change in the law as Phel p s d i d
, Plaintiffs here seek relief f rom an un favorable change in the law that Plain t iffs claim has “the disastrous and fundam entally unjust consequence” o f leaving them with the burdens of the parties’ negotiated stipulation, but none of the benefits. B ecause of these c o n trasting circum stances, the
nature of a c hange in the law that m ay equitably weigh in favor of g ranting R

ule 60(b)(6) reli e f here is likely to be d ifferent than it was in Phelps

. For exam ple, while the fac t that the relevant Ninth C ircuit law w as “decidedly u n settled”
cut in favor of relief in Phelps
, here the fact that the relevant Ninth Circuit l aw was relatively settled m ay cut in favor o f reli e f b e cause it m akes Plaintiffs’ reliance on that law m ore reasonable.

Thus, while we conclude that the change in the law f actor is also applicable in non-habeas cases, we n o t e that courts considering this factor should not in rote fashion rely on the conclusion from a different context that any particular type o f change in the law favors or disfavors relief. Instead, a district
court should weigh whether the specific nature of the change in the law in the case before it m akes granting relief m ore o r less justified under all of the circum stance s , an d should support its conclusion with a reasoned explanation grounded in the equitable considerations raised by the case at bench.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 19

Here, the district court concluded that the natur e o f Microso f t ’ s c h a n g e i n th e l aw

— n am e ly
, o v errulin g p recedent,

on which Plaintiffs had re l i e d
, that was settled in the Ninth Circuit but not nationwide—weighed “slightly against” granting Rule 60(b) relief, because F idelity had warn ed that it would c h allenge appellate jurisdiction, m eaning that Plaintiffs were apprised of the risk of an adverse decision, but still chose to voluntarily dism iss their case. The district court further pointed out that the circum stances of the change in the law were “hardly extrao rdinary” because the change involved

a resolution of a circuit split by the Suprem e Court. Plaintiffs challenge the district court’s weighing of this factor, arguing that they were entitled t o r ely on then-settled circuit precedent, and that the district court therefore abuse d its discretion by treating the voluntary dism issal as a reckless
gam ble for which Plaintiffs should suffer the consequences despite their reasonable reliance on settled circuit law.

W e hold that the district court’s conclusion was an abuse of discretion, as th i s f

actor was m o re properly viewed as neutral or sl i ghtly favoring Plaintiffs. It was not

unre asonable for the district court to consider the extent to which Plaintiffs took a knowing and calcu l at ed risk by relying on Circuit p recedent to v oluntarily dism iss their case with p rejudice, but the district court overlook ed im p ortant

com peting considerations in reaching its evaluation.

On the one hand, unlike cases such as Phelps in which the
court m ust d ecide wh e ther to reopen a case to grant the benefit o f a favorable change in the law, h ere the court had to

assess whether to grant relief in the context of an unfavorable change in the law that seem ingly prejudiced Plaintiffs by

a l t e ring the intended effect of their previously-negotiate dH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 20

stipulation. 6 Because granting r e lief from judgm ent under Rule 60(b)(6) is largely an equitable decision, it m akes sense to consider whether Plaintiffs were blindsided by the change in l aw and could not have done anything to avoid its prejudicial effect, or whether the predicam ent they face is the result of their knowingly taking a calculat e d r i s k for which they should be held responsible.

To illustrate, analyzing whether Plain tiffs, equitably, should suffer the consequences o f the unfavorable change in the law m ight reasonably involve considering:

(1) the extent to which the precedent upon which Henson and Turner relied was settled in the Circuit, which woul d

m ake the reliance m ore re a sonable (favors Plaintiffs because there was clear Circuit precedent);

(2) the extent to which He n s on and Turner should have known that the law m ight change in an unfavorable way (neutral or slightly f

avors Plaintiffs because the Suprem e Court had not yet even granted certiorari in Microsoft
, and Plaintiffs reasonably relied o n well-established Ninth Circuit law. Comp a re Omstead
, 594 F.3d at 1085; Berger
, 741 F .3d at 1065, with Microsoft C orp. v. Baker
, 135 S. Ct. 890 (2016) (granting petition for a wr i t o f certiorari));

6 In t heir b riefing, Plaintiffs assert t hat t his case presents “a question of correcting the m anifest in ju s tice in enforcing the dism issal term of a stipulation when t

he application of a change in the law to a pending appeal has invalidated the essence of the agre e m en t o n which the j u dgm ent o f dism issal is based.”H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 21

(3) the nature of the risk Henson and Turner knowingly took (slightly favors Plaintiffs b ecause even if Hen s o n and Turner k new that they risked an adverse decision regarding their early appeal if Fidelity succeeded in challenging appellate jurisdiction, th at does n ot m ean they knowingly risked perm anent finality. Fidelity did
not state th at i ts position would be that the case was entirely ov e r i f there was no appellate jurisdiction; the only understanding incorporated in th e s t ipulation was that finality d epended on losing the appeal on the m erits;

(4) the ex tent to which Plaintiffs w ere forced to rely on the precedent and put them selves in a precarious situation for lack of o ther reasonable options that would have avoided the risk (favors Fidelity b e c au se Plaintiffs had a choice about which p r o cedure to u se: entering a voluntary dism issal, petitioning the di s tr ict court to certify the interlocutory order for appeal pursuant to 28 U.S.C. § 1 292(b), requesting perm ission to file an interlocutory appeal under Federal Rule of Civil Procedure 23(f), o r proceeding on Turner’s individua l claim and again requesting class certificati o n at a later stage, 7 see Microsoft , 137 S. Ct. at 1711); and

7This array of available choices distinguishes this case from United States v. Foster
, 783 F.2d 1082 (D.C. Cir. 1986), on which Plaintiffs rely for their argum ent that a litigant is justified i n relying on existing circuit precedent “even when it is subjected to criticism an d (in retrospect) destined to b e overturned.” In F oster , the court decided to apply a change in a crim inal pro c e dure rule only prospectively, b ecause t he crim i nal defendan t ’s reliance o n the previously settled circuit law was not only “reasonable,” but “the only responsible course ,” such that it would be unfair to “change the ground rules after the trial.” Id. at 1086 (em phasis added).H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 22

(5) the extent to which the circum stances surroundin g the

c hange in law were extraordinary (perhaps neutral o r slightly favors Plaintiffs, because although the tim ing of Microsoft was som ewhat extraordinary in its effect on this case, cf. Phelps
, 560 F.3d at 1127 (noting that if the intervening change in the law had b e e n m ade “a few

m onths earlier,” the h abeas petition at issue “would have been rem and e d t o the district court for a d ecision on the

m erits”), Microsoft w as an otherwise routine Supr em e Court decision resolving an open circuit split).

In light of these rele v ant considerations, the district court proper l y d eterm ined that the nature o f the change in the law—the abrogation of settled Ninth C ircuit precedent by the Suprem e Court’s resolution of a circuit split—m eant th at Plaintiffs k

nowingly accepted som e risk of an unfavorable change in the law.

On the other hand, the district court f ailed to factor in the consideration tha t l i tigants are entitled to rely on wellestablished circui t l aw a s to which, at the tim e of reliance, there was no c ase pending in the Suprem e Court either on a petition for writ of certiorari or on the m erits. Although there is always the possibility that a we ll-established rule of this
court w ill be abrogated b y the Suprem e Court, it is not in this Court’s institutional interest, or that of the litigants b efore it,
to fault lawyers who proceed on the basis that an established procedural rule wil l rem ain intact, absent som e tangible indication (such as a pending Suprem e Court case) that it m ay not. Addition a l l y, the district court should have considered
th e specific risk that Plaintiffs knowingly undertook. There is a difference between risking an adverse decision o n th e issue o f appellate jurisdiction and the opportunity for an early appeal, and knowingly risking perm anent finality. W eighingH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 23

the relevant co n sid eratio n s o utlin ed a b o v e, the change-in-thelaw factor is neutral o r slightly favors granting Rule 60(b) relief. It wa s an abuse of discretion f or the district court to conclude otherwise.

2. Plaintiffs’ Diligence In Pursuing Relief

The second Phelps factor is the petitioner’s exercise o f diligence in purs u i ng his claim for relief. See Phelps
, 5 69 F.3d at 1135–36; see also Jones
, 733 F.3d at 839. In Phelps
, we concluded that the petitioner was diligent because he had pursued “all possible avenues” in advocating for his l e g a l po s it i on, including securing a certi fi c ate of appealab ility, filing petitions for rehearing en banc and certiorari, and filing m otions for reconsideration. See Phelps
, 569 F.3d at 1136–37. Here, the district court concluded that, although Plaintiffs were d iligent in requesting relief from judgm ent on rem and, the diligence f actor was neutral because Plaintiffs did not initially seek reconsideration of the class certification denial, or request that the district court certify an interlocutory ap p eal, before they proceeded to voluntarily dism iss th eir case. In reaching this conclusion, the district
court adopt e d Fidelity’s interpretation that the diligence factor pertained to “Plaintiffs’ diligence (or lack thereof) in pursuing relief over the entire course of this l it ig ation.” Plaintiffs challenge this interpretation, m aintaining that their earlier strategic decision to voluntarily dism iss “has nothing
to do with the diligence factor,” and that th e district court therefore again inappropriately penalized them for relying on settled circuit p recedent when th e y opted to voluntarily dism iss their case.

Once again, the different circum stances in this case as

com pared to Phelps affect the application and r elevance o fH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 24

the instant factor. In Phelps
, because the petitioner sought the benefit o f a fav o rable change in the law, the fact that the petitioner ha d been diligent in advancing the legal position that was u ltim ately adopted by that change in the law was relevant to the equitable considerations im plicated by a Rule 60(b)(6) m otion. See id. ; see also G onzalez
, 545 U.S.
at 537–38 (considering diligence in term s of petiti oner’s efforts to pursue review of the legal issue on which he later requested rel i e f)

. Here, however, Plaintiffs of course were not advocating for Microsoft ’s unfavorable change in the law, and thus the factor d oes not quite have the sam e p ert i n ence. Perhaps the corollary consideration in this conte x t is Plaintiffs’ diligence in attem pting to avoid or m itigate the risk of the unfavorable change in the law from which they n ow seek relief. From that perspective, it was not entir e ly unreasonable under the circum stances for the district court to consider not only Plaintiffs’ d iligence in m oving for r e l ie f from judgm ent, but also their failure to seek reconsideration

o f th e class certification denial or request that the district
court certify an interlocut o ry appeal before choosing to voluntarily dism iss their case. 8 On the other hand, unlike in Phelps
, a m otion for reconsideration o r for certification of an interlocuto ry appeal w ould not h ave directly addressed the

area o f law that was later changed by Micro soft

. Furtherm o re, it m ay be the case that Plaintiffs did not pursue those other avenues because they did not b el i e v e they had a

8 W e disagree, however, with the district court’s broad phrasing t hat Plaintiffs’ general diligence over the e n ti re c ourse of the litigation is necessarily relevant to t

he Rule 60(b)(6 ) d eterm ination. A lthough the Phelps court discussed a lengthy tim eline of events in considering Phelps’ diligence, all of those event s related t o the legal basis on which Phelps later sought relief f

rom judgm ent. See Phelps
, 569 F.3d at 1 136–37. Thus, the diligence to be considered should bear a relationship t o the relief requested in the Rule 60(b)(6) m otion.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 25

sufficient basis to file such m otions; courts should be cautious
to count against a p arty seeking Rule 60( b ) (6) relief the failure to file certain m otions, unless the court can determ ine that filing such a m otion w ould not have been an utter exercise in futility.

Thus, while the district court d id not abuse its discretion in assessing the dilige n c e fa c tor and concluding that it was neutral, we note th at under the circum stances the f actor appears to be less salient to the overall Rule 6 0 ( b ) ( 6 ) equitable balancing than it was in Phelps

.

3. Reliance Interest in the Finality of the Case

The third factor we considered in Phelps is whether
g rant ing the Rule 60(b) m otion for relief from judgm e n t would u pset “the p arties’ reliance interest in the finality of the case.” Phelps
, 569 F.3d at 1137; see also Jones
, 733 F.3d at 839–40. In this case, the distri c t court concluded that the parties’ interest in f

inality we i g hed against granting relief because there could be “n o qu e stion

. . . of the parties’ intention regarding finality in entering into the stipulation to dism iss thi s case.” Plaintiffs challenge this conclusion, arguing that Fidelity had no reliance interest in the finality o f the stipulation

- b a sed judgm ent because the stipulation

exp licitly co ntem

p lated th e p o tential f

o r su b seq u ent li t i g atio n , and stated that Plaintiffs would take nothing only if bo th o f the appealed district court orders were affirm ed, which never happened.

W e agree w ith P laintiffs and hold that the d i s tr i ct court

m isco n s trued this factor and overvalued Fidelity’s reliance interest in the finality of the judgm ent. First, the district court only considered Fidelity’s abstract interest in finality, but not,H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 26

as Phelps ins tructed, whether Fidelity had any reliance interest in the finality of the j u d g me nt. In Phelps
, we explained that courts should consider wh e ther “the final judgm ent b eing challenged has caused one or m o re of the
p arties to change his legal position in reliance on th at j u d gm ent” such that granting the m o tion for relief woul d “undo the past, executed effects of th e j u d g m ent.” Phelps
, 569 F.3d at 1137–38 (citation om itted). For exam ple, a party

m ight have a reliance interest in the f inality of a judgm ent “when a judgm ent conveys land f rom one party to another and the prevailing party ‘enter[s] upon the land and install[s] pipes and appurtenances,’” or “when a judgm ent affords a federa l h abeas petitioner a new trial that results in the eventual dism issal of th e ch arges and his release from custody.” Id. (alterations in o riginal) (italics om itted) (qu o ti n g Ritter v. Smith
, 8 11 F.2d 1398, 1401 (11th Cir. 1987)). H ere, however, there is no evidence that F idelity “has relied in such a fashion on the finality o f the distric t court’s dism issal.” Id. at 1 138. As in Phelps
, “[t]here are no ‘past effects’ of the judgm ent that would be disturbed if the

case w ere reope n e d for consideration of the m erits

. . . . Instead, the p arties would sim ply pick up where they left o ff.” Id. Thus, as in Phelps
, this factor should “weigh[] heavily in [Plaintiffs’] favor.” Id.

Furtherm o re, the finality interest in this c a s e is even weaker than that in Phelps because, here, Plaintiffs’ appeal had not been f

inally decided before Microsoft changed the law. See id. at 1126 (explaining that Ph elps’ appeal h ad becom e final fifteen m onths b efore the change in the law that
prom pted his Rule 60(b)(6) m otion). Be cause the present

case w as still p ending o n appeal when Microsoft was decided, and was then rem anded to the district court for further proceedings, F idelity could not reasonably have believed thatH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 27

the dism issal was imm

utably final. Moreover, the dism issal itself belies any reliance interest in f inality, because the dism issal was explicitly l inked to an attem pt to expedite the appeal. The parties’ stipulation contem plated that Plaintiffs’ claim s would be revived and that litigation would continue in the district court if the Ninth Circuit reversed either o r b oth of the appealed orders. 9 And, although Fidelity reserved the right to argue that the imm ediate appeal was im proper, it could not have relied on prevailing on that challenge, as Ninth Circuit law at th e tim e was squarely against its position.

It w as th i s v e ry o pportunity for revival of claim s and subsequent litigation that led the C ourt in Mic r o s o f t to conclude that this type of conditional vo l untary dism issal is not, in fact, “final.” See Microsoft
, 137 S

. Ct. at 1715. Plaintiffs p e r suasively argue that, “[i]f class certification orders are not app e a l able because a voluntary dism issal intended to be subject to revival is not really a final judgm ent, then there is little finality interest in the dism issal and there is every reason to allow vacatur of su ch preMicrosoft dism issals

. . . .” Thus, even after Microsoft
, there

9 Not only did the stipulation contem p l a t e continued litigation if Plaint i ffs s u c ceeded in their appeals, but Plaintiffs argue that, even if Fidelity prevailed on its jurisdictional challenge and succeeded i n having the appeals dism issed, Fidelity could not have expected that the stipulated dism issal order would becom e final, b ecause the stipulation provided only that P laintiffs w ould take nothing if b oth o f the d istrict court’s o rders were affirmed on appeal. The text of th e s tipulation further belies a finality interest because it e xp l i citly states that, “by Plaintiffs voluntarily dism issing their c l a i m s with prejudice, the Court’s April 29, 2014 order

on Defendant’s Mo t i o n fo r Judgm ent o n the Pleadings is not a final judgm ent and shall not provide a b a s i s fo r collateral estoppel against Defendant in subsequent litigation.”H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 28

was no reason to anticipate that the voluntary dism issal would be treated as final, wi thout either an opportunity to revive Turner’s voluntarily dism issed claim in the d istrict court, o r appellate review of the involuntary dism issal o f Henson’s claim s and the class certificatio n order.

The district court’s contrary a n aly sis o f F id elity ’s reliance interest in the finality of the dism issal therefore ignored key consideration s , failed to follow our guidance in Phelps
, and

was unsupported by the facts. The d istrict court’s conclusion that this factor “weighs against granting Rule 60(b) r e l i e f”

was an abuse o f d i s c r etion. Fidelity has n ot shown any reliance interest in the finality of the judgm ent, and the appeal of the judgm ent wa s still p ending when Microsoft was decided; this was not a case in which a party re l ied on the finality of a judgm ent after an appeal had b ec o m e final and litigation had ended m onths or even years before a change in the law prom

p ted a Rule 60(b) m otion. As a result, whether relief from the judgm ent would upset “the parties’ reliance interest in the finality of the case” weighs heavily in favor o f granting relief. See Phelps , 569 F.3d at 1137.

4. Delay Between the Judgme nt a nd the Rule 60(b) Motion

The fourth Phelps fac t or “exam ines the ‘delay between the finality of the judgm ent and the m otion for Rule 60(b)(6) relief.’” Phelps
, 569 F.3d at 1138 (quoti n g Ritter
, 811 F.2d
at 1402). “This factor stands f or the ‘principle that a change in the law should n ot indefinitely rende r p re existing judgm ents subject to potential challenge.’” Jones , 733 F.3d
at 840 (quoting Phelps
, 569 F.3d at 1138). The district court found that the delay f

actor was neutral because, although the Rule 60(b) m otion was f iled 3.5 years after the vo l un t aryH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 29

dism issal, “the parties were actively involved in the appellate proceedings and were seeking re s o lution before the Ninth Ci rc uit in [ the] tim e imm ediately after the Court dism issed the case.” Plaintiffs do not challenge this determ ination, but

we m ake one b rief correction. The district court’s use of the d at e on which the voluntary dism issal was entered in th e district court, rather than whe n any appeal of that dism issal becam e final, does not follow the guidanc e we s et forth in Phelps

. See Phelps
, 5 69 F.3d at 1138 n

. 2 1 (“[W ]e consider the length of tim e b etwe e n when the original judgm ent

. . . becam e final after a

ppeal
, and the t i m e at which [a party] filed [its] first m otion [for Rule 6 0(b)(6) relie f]. ” (em phasis added) (citing Fed. R. Ap p

. P. 41)). In this case, the judgm ent n ever truly becam e f inal on appeal, and in any case, Plaintiffs m oved for relief shortly after the Ni n th Circuit

rem anded the case to the district court. As a result, when properly applied, the delay factor weighs in favor of granting Rule 60(b)(6) relief. See id. at 1138.

5. Relationship B etween the Original Judgment and the Change in the Law

The fifth Phelps factor “looks to the clo s e ness o f the relationship between the decision resulting in the o riginal judgm ent and th e subsequent decision that represents a change in the law.” Jones
, 733 F.3d at 8 4 0 (citing Phelps
, 569 F.3d at 1138–39). As we explained in Phelps
, this f actor recognizes the ever-changing nature of the law and seeks to

m easu re wh ether any p articular change is extraordinary un d er the circum stan c e s a s a result of a direct relationship to the original judgm ent:

[T]his f actor is designed to recognize that the law is regularly evolving. The foundation o fH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 30

the Am erican judicial system that sets it apart from m any regim es across th e world is its

comm on l aw h eritage, which is imm anent in judicial i n terpretations of legal texts ranging from statutes to judicial o p inions to the Constitution itself. Given this tradition, legal rules and principles inevi tably shift and evolve o ve r tim e, but the m ere fact that they do so cannot ups et all final judgm ents that have predated any specific change in the law. Rather, the nature of that change is im portant. Accordingly, [this] fa ctor directs courts to

exam ine closely the original and intervening decisions at issue in a particular m ot i o n for [Rule 60(b)] relief predi c at e d o n an i nt e rvening change in the law: if there is “ a close connection between the two cases, the
court [will b e m ore likely to] f[i]nd the circum stances sufficiently extraordinary to justify disturbing the finality of the [original] judgm ent.”

Phelps
, 569 F .3d at 1139 (footnote o m itted) (alterations in
quote in o riginal) (quoting Ritter
, 811 F.2d at 1402)

. Th e district court found that the “cl o se connection between Plaintiffs’ underlying case and [ Microsoft ]” weighed in favor of granting r el i ef, and Plaintiffs do not challenge this d et e rmi nation. W e agree with the district court both that there is a close connection between the original judgm ent and Microsoft
, because the voluntary dism iss a l was explicitly predicated o n the law that Microsoft changed, and that this factor therefore weighs in favor of Rule 60(b)(6) relief.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 31

6. Concerns of Comity

The sixth Phelps factor conside rs concerns o f com ity. Jones
, 733 F.3d at 8 40 (citing Phelps
, 569 F.3d at 1139). In Phelps
, we ruled that this factor cut in favor of relief because the dism issal of Phelps’ habeas petition had be e n on procedural grounds, which m eant that granting relief f rom the dism issal would not upend the com ity principle. See Phelps
, 569 F.3d at 1139 (“[I]n the context of Rule 60(b)(6), we need
not be concerned about upsetting the com ity principle when

a petitioner se eks reconsideration not of a judgm ent on the meri t s of his habeas p etition, but rather o f an erroneous judgm ent that prevented the court from ever reaching the

m erits of that petition.”). 1 0

The district court found that the com ity factor weigh e d against granting Rule 60(b) relief because the predicam ent in which Plaintiffs found them selves was the result of their free, calculated, and deliberate trial strategy. Plaintiffs challenge this analysis, claim ing that the district court again faulted them for relying on Circuit law.

W e agree that the district court erred in its analysis of the

com ity factor; the district court’s d e c ision that this f actor weighed against relief rested upon an erroneous v iew of what considerations are relevant to the princi p l e o f com ity. In particular, it is unclear that there is any relationship between the fact that Plaintiffs m ay have m ade a calculated decision

10 Furtherm o re , we noted that the habeas statute was aim ed at ensuring that federal courts could p rotect con stitutional rights, and t hat “[t]he delicate principles of com ity governing the interaction between coordinate sovereign judicial syst em s d o not require federal courts to abdicate their role as vigilant protectors of federal rights.” Id. at 1139.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 32

to voluntaril y d i sm iss their case despite the potential

c o nsequences and principles of com ity. The district c o urt ci t ed n o Ninth Circuit precedent suggesting that this is an appropriate consideration under the com ity factor, nor do we

see why it is r e l e vant. 1 1 In f act, considerations of com ity “between the independently sovereign state and federal judiciaries” that we d iscussed in Phelps do not apply here at all, becaus e this case does not involve a federal habeas
p et i tion that challenges a state conviction. See Phelp s , 569 F .3d at 1139 (“[I]n applying Rule 60(b)(6) to cases involving petitions for habeas corp u s , j u dges m ust bear in

m ind that [a] fe deral court’s grant o f a writ of habeas
corpus

. . . is always a serious m atter imp l i c ating considerations of com ity.” (internal quotation marks and italics o m itted)). A s a result, the district court’s finding that the c o m ity factor weighed against relief was an abuse o f discretion. The district court instead should have skipped the Phelps com ity factor as inapplicable.

7. Additional Considerations

Instead of com ity between the federal and state courts, the district court could have considered a som ewhat analogous issue that is m ore relevant here, nam ely, the im portan c e of heeding the inten t o f the rulings of federal appellate courts. Cf. id. at 1133, 1135 ( explaining that the Phelps factors do
not “im p ose a rigid or exhaustive checklist”—a district court

m ust “evaluate the circum stances surr ounding the specific

m otion before the court” to e nsure that “justice [is] done in

11 As discussed above, however, the extent to which Plaintiffs are at fault for their own predicam ent as a result of taking a calculated risk m ay be an appropriate consideration in this case under the factor that considers the nature of the change in the law.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 33

l i gh t o f a ll the facts”). For exam p le, the district court could have tak e n account of the f act that, when the Ninth Circuit denied the m otions to dism iss P laintiffs’ appeals and instead

rem anded to the district court for appropriate relief in the first instance, it is unlikely that the Ninth Circuit intended for the district court to deny all relief and also refuse to re-enter final judgm e nt, thereby denying Henson and Turner any opportunity to have their previously rem anded appeals heard on the m erits.

Simi l arl y , it would have b een relevant for the district
court to consider how best to stay true to the Suprem e Court’s reasoning in Microsoft

. Nothing in Microsoft suggests that a litigant who agreed to a conditional dism issal t o obtain appellate review of a class certification ruling should h ave her claim s unconditionally dism issed, rather than being restored
to the status quo prior to entering the stipulation. 1 2 In fact, it is so m ewhat paradoxical that, although the Court in Microsoft ruled that a conditional voluntary d i s missal like the one in this case is not a final judgm ent under § 1291, see Microsoft
, 137 S

. C t. at 1715, the dis tr ict court effectively treated the volunt ary d i sm issal as a final, irrevocable judgm ent. This leaves Plaintiffs in a catch twenty-two be c au se, under Microsoft
, the dism issal w as not a f inal judgm ent f

rom which

12 The Suprem e Court in Microsoft d id not give any explicit i ndication of how t he case should p ro c e ed, if at all, following the Court’s decision that t here was no appe ll a t e j urisdiction to review the class certification order. See Microsoft
, 137 S. Ct. at 1715. That is, the Suprem e Court did
not com m ent about whether the stipul a t e d d ism issal would rem ain in force, and thus paradoxically b ecom e “final,” or whether t he district court should pick up where the case left off before t he stipulated d ism issal was entered. However, the S uprem e Court did rem and the ca s e “for further proceedings consistent with t his opinion,” suggesting that it did not view the voluntary conditional dism i ssal as being f inal and i rrevocable. See id.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 34

Turner could appeal the denial of class certification, but in the district court, the voluntary dism issal wa s treated as having finally ended the case. The interest i n avoiding such a contradiction with the Court’s reasoning in Microsoft weighs in favor of granting relief under Rule 60(b)(6).

Finally, the negotiated nature of the voluntary dis mi s s al presents a circum stance unique to this case that is relevant to the determ ination of whether Rule 60(b) ( 6 ) relief from the judgm ent that was predicated on that stipulation is warranted. The d istrict court did not address directly the explicit text o f the stipulation to determ ine wheth e r th e term s of the
agreeme n t negotiated by the p arties contem plated that the dism issal would becom e final even if the appell at e c ourt found that it lacked jurisdiction and the r e fore did not reach the me r its of Plaintiffs’ appeals. In particular, while the stipulation does not set forth any specific agreem ent about how the dism issal would be treated in the event of a successful challenge to appellate jurisdiction, the stipulation does provide that “plaintiffs will take n othing by way of their

com plaint” if “the orders appealed are affirmed .” (Em phasis added.) B ecause Plaintiffs appeals were rem anded without a decision on the m erits, the district court’s orders were never affirm ed. Thus, it would h ave b een relevant to the equities to consider whether, under the strict text of the s tipulation, Plaintiffs agreed to dism iss their case with prejudice in the
current scenario, or whether g iving effect to the term s of the negotiated agreem ent supported granting relief. 1 3

13 W e do not wade into the fact-fin d i n g re qu ired to answer t h is question, as it i s not necessary to decide this case. W e only point out the relevance of this consideration to guide f uture courts faced w ith Rule 60(b)(6) m otions.H E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 35

8. Weighing All Relevant Considerations

“W eighing all the relevant factors together and evalu ating the circum stances of th i s c ase,” the district court ultim ately concluded that the circum stances did not warrant relief under Rule 60(b)(6). As d etailed above, of the six Ph elps factors, the district court found that th e r e l i ance interest and com ity factors weighed against g ranting relief, th e n ature of the change in the law weighed slightly against granting relief, the diligence and delay factors were neutral, and the relative closeness between the judgm ent and the change in the law weighed in favor of relief.

However, as discussed above, the district court’s analysis of the change-in-the-law, reliance interest
, an d com ity factors—those which it found weighed against relief—rested
upon an incorr e c t v iew o f the law. The change-in-the-law factor is neutral o r s l i ghtly f avors relief because Plaintiffs relied on w ell-established circuit law and did not knowingly risk perm anent finality, even though th e y knew F idelity would challenge appellate jurisdiction and they could have take n a di fferent course o f action. Properly interpreted and applied, the f

actor considering the parties’ reliance interest in the finality of the judgm ent w eighs heavily in favor o f Rule 60(b)(6) relief, because the change in the law occurred while the app e al was pending, before the judgm ent becam e final and b e fore Fidelity d eveloped any reliance interest in the finality of the judgm ent. In addition, b ecause the instant case does not im

plicate principles of com ity b etween state and federal courts, the com ity factor is inapplicable and does not, as the district court found, weigh against granting relief.

W eighing all the Phelps factors, correctly analyzed, it is clear that all the relevant circum stances i n th is case h eavilyH E N S ON V

. F I D EL I TY N AT ’ L F I N A N C IAL 36

tip the scale in favor of g ranting Rule 60(b)(6) relief. Although by the d istrict co urt’s reasonable calculus the nature in the change of the law factor weighed “slightly against” granting relief, all th e other factors are neutral or weigh in favor o f granting relief. Together, the circum stances of this

case are therefore sufficiently “extraordinary” that granting relief f rom judgm ent here “is appropriate to accom p lish justice.” Phelps
, 569 F.3d at 1 135 (quoting Go nz a l e z , 545 U.S. at 542).

IV

Because the district co urt’s d enial of Plaintiffs’ Rule 60(b)(6) m otion rested upon an erroneous view of the law as to several significant factors, the district court’s ruling was an abuse of discretion. See Phelps
, 569 F.3d at 1131. Moreover, in light of all the circum stances of this case, we are left with “a definite and firm conviction that the district court

comm itted a clear err or o f judgm ent in the conclusion it reached upon a weighing of relevant factors.” See Valdivia
, 599 F.3d at 988.

W e therefore reverse the district court’s denia l o f Plaintiffs’ R

ule 6 0 (b)(6) m otion for relief from judgm ent, and

rem and with directions to g rant the Rule 60(b)(6) m o tion and for further proceedings.

REVERSED and REMANDED w ith directions.