* Pursuant to 5TH CIR. R. 47.5, the court has determined that

this opinion should not be published and is not precedent except

under the limited circumstances set forth in 5TH CIR. R. 47.5.4.

United States Court of Appeals

Fifth Circuit

FILED

May 27, 2004

Charles R. Fulbruge III

Clerk

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

 

No. 03-11038

Summary Calendar

 

ABC UTILITIES SERVICES INC; ABC ASPHALT INC; UTILITIES EQUIPMENT

LEASING COMPANY INC,

Plaintiffs-Appellants,

versus

ORIX FINANCIAL SERVICES INC, formerly known as Orix Credit

Alliance Inc,

Defendant-Appellee.

--------------------

Appeal from the United States District Court

for the Northern District of Texas

USDC No. 3:02-CV-1538-N

--------------------

Before HIGGINBOTHAM, DAVIS, and PRADO, Circuit Judges.

PER CURIAM:*

ABC Utilities brought an independent action under FED. R. CIV.

P. 60(b) to set aside the judgments issued by a bankruptcy court

and two district courts. The district court, after setting aside

a default judgment against Orix, dismissed ABC’s independent action

pursuant to FED. R. CIV. P. 12(b)(6), finding that the action was

outside the one-year limitations period for a Fed. R. Civ. P.
No. 03-11038

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1 FED. R. CIV. P. 55(c), 60(b).

2 Dolphin Plumbing Co. of Florida, Inc. v. Financial Corp. of

North America, 508 F.2d 1326, 1327 (5th Cir. 1975).

3 Kansa Reinsurance Co., Ltd. v. Congressional Mortg. Corp. of

Texas, 20 F.3d 1362, 1366 (5th Cir. 1994).

60(b)(2) or (b)(3) motion, and given that ABC was “well aware of

the essence of their claims while the very judgment they now try to

set aside was being litigated,” ABC could not satisfy the equitable

requirements for a proper independent action. On appeal, ABC

asserts that the court erred by setting aside the default judgment

initially entered against Orix and by dismissing its independent

action. We affirm.

Initially, ABC obtained a default judgment against Orix

because Orix failed to file a timely answer. However, the district

court set aside the default judgment, finding that Orix’s failure

to answer was the result of excusable, inadvertent miscalendaring.

A court may set aside a default judgment for “mistake,

inadvertence, surprise, or excusable neglect.”1 We review the

court’s decision to set aside the default judgment for an abuse of

discretion.2 Here, the district court found that Orix’s failure to

answer was the result of an excusable mistake, and ABC provides no

authority showing the court’s actions to be an abuse of discretion.

We review the district court’s dismissal de novo, “accept[ing]

all factual allegations made in the pleading as true and ask

whether, under the circumstances asserted, the allegations state a

claim sufficient to avoid dismissal.”3 Although the factual
No. 03-11038

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4 Id.

5 FED. R. CIV. P. 60(b)(2)-(3).

6 FED. R. CIV. P. 60(b).

7 11 CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND

PROCEDURE § 2868 (2d ed. 1995).

8 524 U.S. 38, 46-47 (1998).

allegations must be taken as true, the district court “need not

resolve unclear questions of law in favor of the plaintiff,” and

“when a successful affirmative defense appears on the face of the

pleadings, dismissal under Rule 12(b)(6) may be appropriate.”4

Fed. R. Civ. P. 60(b) provides that within one year of a

judgment “the court may relieve a party or a party’s legal

representative from a final judgment, order, or proceeding for

. . . (2) newly discovered evidence which by due diligence could

not have been discovered in time to move for a new trial under Rule

59(b) . . . [or] (3) fraud (whether heretofore denominated

intrinsic or extrinsic), misrepresentation, or other misconduct of

an adverse party.”5 The Rule explains, however, that it “does not

limit the power of a court to entertain an independent action to

relieve a party from a judgment.”6 An independent action is

brought in equity to set aside judgments that would result in a

manifest miscarriage of justice, and requires, among other things,

“the absence of fault or negligence on the part of the defendant.”7

In United States v. Beggerly,

8 the Supreme Court explained

that independent actions must not be allowed to subvert the oneyear statute of limitations for Rule 60 actions: 
No. 03-11038

-4-

9 Id. at 46 (internal quotations omitted).

10 See Beggerly, 524 U.S. at 47.

If relief may be obtained through an

independent action in a case such as this,

where the most that may be charged against the

Government is a failure to furnish relevant

information that would at best form the basis

for a Rule 60(b)(3) motion, the strict 1- year

time limit on such motions would be set at

naught. Independent actions must, if Rule

60(b) is to be interpreted as a coherent

whole, be reserved for those cases of

injustices which, in certain instances, are

deemed sufficiently gross to demand a

departure from rigid adherence to the doctrine

of res judicata.9

Accordingly, if a plaintiff’s allegations could form the basis for

a Rule 60(b)(2) or (b)(3) motion, but the action is outside the

one-year limitations period and does not rise to the level of a

miscarriage of justice, an independent action must fail.

ABC is not within the one-year limitations period because it

has known the basis of its fraud allegations at least since 1993.

The complaint in this case itself notes that ABC has held the “new”

documents necessary to investigate and allege Orix’s fraudulent

actions since 1998. Therefore, ABC must demonstrate that allowing

the judgments at issue to stand would work a grave miscarriage of

justice.10 

Based on the face of the complaint and on previous judgments

of which the district court took judicial notice, the district

court properly dismissed ABC’s complaint because it is clear that

“no relief could be granted under any set of facts that could be
No. 03-11038

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11 American Waste & Pollution Control Co. v. Browning-Ferris,

Inc., 949 F.2d 1384, 1386 (5th Cir. 1991) (quoting Baton Rouge

Bldg. & Constr. Trades Council v. Jacobs Constructors, Inc., 804

F.2d 879, 881 (5th Cir. 1986)). 

12 ABC Asphalt Inc. v. Credit Alliance Corp., No. 94-10118 (5th

Cir. May 15, 1995) (“By lying behind the log until after it

received an adverse judgment to play its alternative ‘conflict

card,’ ABC failed to protect its own interests in a timely fashion.

ABC cannot now seek a second bite at the apple under Rule 60(b)(6).

No manifest injustice is present here.”).

13 Beggerly, 524 U.S. at 46-47; Humanetics Inc. v. Kerwit

Medical Products, Inc., 709 F.2d 942, 943-44 (5th Cir. 1983).

proved consistent with the allegations.”11 ABC and Orix have been

in some form of litigation over the past fifteen years. It has

claimed that Orix fraudulently overcharged it in numerous courts,

and it could have raised the allegations during the bankruptcy

proceeding. A previous panel noted ABC’s intentional delay in

raising Orix’s alleged fraud in order to manipulate the litigation

process.12 ABC could have brought timely Rule 60(b)(2) or (b)(3)

motions within one year after these judgments, but for whatever

reason, it did not do so. Given that the allegations at most form

the basis of a Rule 60(b)(2) or (b)(3) motion and that ABC’s choice

to reserve these allegations until a later day precludes a finding

of a manifest miscarriage of justice, an independent action cannot

be maintained.13 

AFFIRMED.