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15‐2940‐cv

Cohen v. DHB Industries, Inc.

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT.  CITATION TO A SUMMARY ORDER FILED ON OR AFTER

JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S

LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER

THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”).    A PARTY CITING A

SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second

Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley

Square, in the City of New York, on the  29th day of July, two thousand sixteen.

      

PRESENT: RICHARD C. WESLEY,

DEBRA ANN LIVINGSTON,

    DENNY CHIN,

     Circuit Judges.

______________________

D. DAVID COHEN,  

     Intervenor‐Appellant,

THOMAS HUSTON, derivatively on behalf

of DHB Industries, Inc., BRIAN ABRAMS,

ALVIN VIRAY, Class Action Plaintiffs,

     Plaintiffs,

     ‐v.‐            No. 15‐2940
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DHB INDUSTRIES, INC., nominal

defendant, a Delaware Corporation,

     Defendant‐Appellee,

DAVID H. BROOKS, SANDRA L.

HATFIELD, DAWN M. SCHLEGEL,

JEROME KRANTZ, GARY NADELMAN,

CARY CHASIN, BARRY BERKMAN,

LARRY ELLIS, DAVID BROOKS

INTERNATIONAL, INC., TERRY

BROOKS, ELIZABETH BROOKS

INDUSTRIES, INC., ANDREW BROOKS

INDUSTRIES, INC., JEFFREY BROOKS,

TACTICAL ARMOR PRODUCTS, LEAD

PLAINTIFFS IN THE CLASS ACTION

LITIGATION, WEISER, LLP,

     Defendants.   

______________________  

FOR APPELLANT:   GARY D. SESSER (William F. Sondericker, Leonardo

Trivigno, on the brief), Carter Ledyard & Milburn LLP,

New York, NY.

  FOR APPELLEE:    ALAN J. KORNFELD, Pachulski Stang Ziehl & Jones

LLP, Los Angeles, CA (David P. Kasakove, Bryan Cave

LLP, New York, NY, on the brief).   

Appeal from the United States District Court for the Eastern District of

New York (Seybert, J.).
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UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED AND DECREED that the order of the District Court is

AFFIRMED.  

Intervenor‐Appellant D. David Cohen appeals from an order of the United

States District Court for the Eastern District of New York (Seybert, J.), dismissing

the action pursuant to Federal Rule of Civil Procedure 41(a)(2).  We assume the

parties’ familiarity with the underlying facts and the procedural history, which

we reference only as necessary to explain our conclusions.

Cohen first argues that the District Court’s dismissal of the action without

consideration of his entitlement to fees contravened this Court’s mandate in

Cohen v. Viray (Cohen I), 622 F.3d 188, 196 (2d Cir. 2010).  This argument is

untenable.  “The mandate rule compels compliance on remand with the dictates

of the superior court and forecloses relitigation of issues expressly or impliedly

decided by the appellate court.”  United States v. Ben Zvi, 242 F.3d 89, 95 (2d Cir.

2001) (emphasis omitted) (internal quotation marks omitted).  “But the mandate

is controlling only as to matters within its compass.  When the mandate leaves

issues open, the lower court may dispose of the case on grounds not dealt with

by the remanding appellate court.”  In re Coudert Bros. LLP, 809 F.3d 94, 98 (2d
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Cir. 2015) (internal quotation marks omitted).  The mandate in Cohen I expressly

declined to address the merits of the fee issue and left open the issue for the

District Court’s consideration.  In such cases, our mandate does not preclude the

District Court from considering or deciding the case on alternate grounds.  See

Sompo Japan Ins. Co. of Am. v. Norfolk S. Ry. Co., 762 F.3d 165, 175–76 (2d Cir.

2014).

Second, Cohen argues that the District Court’s dismissal is contrary to law.  

We review dismissals under Rule 41(a)(2) for abuse of discretion.  See Zagano v.

Fordham Univ., 900 F.2d 12, 14 (2d Cir. 1990).  In addition to his mandate

argument, Cohen presents two bases for error: (1) the District Court

misconstrued the settlement agreement, and (2) the dismissal prejudiced Cohen.  

Neither argument is availing.  Cohen has no standing to claim that the agreement

was improperly read by the District Court.  “A settlement agreement is a contract

that is interpreted according to general principles of contract law.”  In re Am.

Express Fin. Advisors Sec. Litig., 672 F.3d 113, 129 (2d Cir. 2011) (internal quotation

marks omitted).  As a nonparty to the contract, Cohen cannot assert rights on the

basis of the contract unless he is a third‐party beneficiary, see Rajamin v. Deutsche

Bank Nat’l Tr. Co., 757 F.3d 79, 86 (2d Cir. 2014), which he is clearly not, see
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Mendel v. Henry Phipps Plaza W., Inc., 6 N.Y.3d 783, 786 (2006).  Similarly, in the

context of a Rule 41(a)(2) dismissal of a claim, prejudice is generally evaluated as

to the party against whom the claim is asserted.1  See Kwan v. Schlein, 634 F.3d

224, 230 (2d Cir. 2011); Catanzano v. Wing, 277 F.3d 99, 109–10 (2d Cir. 2001).  The

claims dismissed here were not against Cohen.  Even assuming Rule 41(a)(2)

required us to consider prejudice to Cohen, the District Court did not abuse its

discretion in concluding that Cohen’s opportunity for a fee hearing under Second

Circuit precedent in the bankruptcy court—a hearing he ultimately received and

in which he prevailed—sufficiently obviated any prejudice resulting from

dismissal.

  We have considered all of Cohen’s arguments and find them to be

without merit.  Accordingly, the order of the District Court is AFFIRMED.

     

       FOR THE COURT:

       Catherine O’Hagan Wolfe, Clerk

       

 

1 Cohen has not argued that Rule 41(a)(2) was not the proper standard to apply to the

dismissal of the action generally, including his fee claim, nor has he argued that his

entitlement to attorneys’ fees invokes Rule 41(a)(2)’s additional requirement when a

defendant has pleaded a counterclaim, see Fed. R. Civ. P. 41(a)(2) (permitting such

dismissals “only if the counterclaim can remain pending for independent

adjudication”).