2005 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

12-19-2005

Greenwich Ins Co v. Goff Grp Inc

Precedential or Non-Precedential: Non-Precedential

Docket No. 04-3096

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Recommended Citation

"Greenwich Ins Co v. Goff Grp Inc" (2005). 2005 Decisions. Paper 94.

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NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

 

No. 04-3096

 

GREENWICH INSURANCE COMPANY;

XL SPECIALITY INSURANCE COMPANY

 v.

GOFF GROUP, INC.,

 Appellant

 _______________

Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. No. 03-cv-02441)

District Judge: Honorable Edmund V. Ludwig

 

Submitted Under Third Circuit LAR 34.1(a)

on September 23, 2005

Before: ROTH, MCKEE and FISHER, Circuit Judges

(Opinion filed: December 19, 2005)

 

O P I N I O N

 

ROTH, Circuit Judge

This is an appeal from the District Court’s order denying relief pursuant to Fed. R.
 1

The Panel sat in New York at the request of the arbitrators but was deemed to be in

Philadelphia as required by the Program Manager’s Agreement.

2

Civ. P. 60(b). For the reasons stated below, we will affirm the decision of the District

Court. 

I. Factual Background and Procedural History

As the situation is well known to the parties, we give only an abbreviated

description of the facts and procedural posture of the case. 

Appellant, Goff Group, Inc., (Goff) agreed to manage the underwriting of workers’

compensation and employers’ liability insurance for appellees, Greenwich Insurance

Company and XL Specialty Insurance Company (together XL). In this capacity, Goff

was responsible for collecting and holding premiums in a segregated trust pending

remittance. A dispute arose regarding Goff’s treatment of these funds.

On August 7, 2002, XL commenced arbitration proceedings against Goff under the

terms of their Program Manager’s Agreement. The next day, Goff successfully brought

suit in Alabama state court for a temporary restraining order after XL suspended Goff’s

underwriting authority. The suit was removed to the United States District Court for the

Middle District of Alabama which granted XL’s subsequent motion to compel arbitration

and dissolve the state court’s injunction. An arbitration panel was convened in the spring

of 2003.

While arbitration was pending in Philadelphia1

 under the terms of the Program

Manager’s Agreement, XL commenced a proceeding before the United States District
3

Court for the Eastern District of Pennsylvania seeking ancillary relief regarding Goff’s

handling of the funds pending arbitration. On April 28, 2003, the District Court granted

the relief sought by XL and retained jurisdiction over the matter. In an order dated

October 3, 2003, the District Court placed the proceedings in suspense pending

arbitration.

Goff sought a stay of arbitration before the arbitration panel, before an Alabama

state court, and before the District Court in the Middle District of Alabama, all of which

were denied. On March 10, 2004, the arbitration panel directed Goff to pay XL

$4,332,382.00 in damages. XL filed a motion before the District Court in the Eastern

District of Pennsylvania to confirm the arbitration award pursuant to the Program

Manager’s Agreement which specifically provided for confirmation in the Eastern

District of Pennsylvania. The motion was served by overnight delivery to Goff’s counsel

of record, John Fabiani. Goff declined to submit any opposition to the motion. Rather,

Goff filed a motion to vacate the award in the District Court in the Middle District of

Alabama.

On April 23, 2004, the District Court in the Eastern District of Pennsylvania issued

a confirmation order and judgment. On May 3, 2004, Goff moved to vacate the

confirmation award pursuant to Fed. R. Civ. P. 60(b)(6). On July 9, 2004, the District

Court denied Goff’s motion and this appeal followed. 

II. Jurisdiction and Standard of Review

The District Court had jurisdiction pursuant to 28 U.S.C. § 1332. We have
4

appellate jurisdiction under 28 U.S.C. § 1291.

We review motions for relief pursuant to Fed. R. Civ. P. 60(b) for an abuse of

discretion. Coltec Indus. Inc. v. Hobgood, 280 F.3d 262, 269 (3d Cir. 2002). An abuse of

discretion my be found when the lower court’s decision “rests upon a clearly erroneous

finding of fact, an errant conclusion of law or an improper application of law to fact.” 

Reform Party of Allegheny County v. Allegheny County Dept. of Elections., 174 F.3d

305, 311 (3d Cir. 1999) (quoting International Union, UAW v. Mack Trucks, Inc., 820

F.2d 91, 95 (3d Cir. 1987)).

III. Discussion

Relief from a judgement, such as a confirmation order, may be granted pursuant to

Rule 60(b)(6) for “any ... reason justifying relief from the operation of the judgment.” 

Fed. R. Civ. P. 60(b)(6). Such relief can only be granted under extraordinary

circumstances, where an extreme and unexpected hardship would otherwise occur. 

Sawka v. Healtheast, Inc., 989 F.2d 138, 140 (3d Cir. 1993). Also, Rule 60(b)(6) does

not provide relief for “calculated and deliberate” litigation choices which, in hindsight,

were erroneous. Ackermann v. United States, 340 U.S. 193, 198 (1950).

Goff offers two purported extraordinary circumstances justifying relief under Rule

60(b)(6). First, Goff contends that it was not properly served the motion to confirm under

the Federal Arbitration Act (FAA). Specifically, Goff argues that as a non-resident of the

state where the arbitration occurred, service was invalid because it was not executed by a

United States Marshal. See 9 U.S.C. § 9 (“If the adverse party shall be a nonresident,
5

then the notice of the application shall be served by the marshal of any district within

which the adverse party may be found in like manner as other process of the court.”). In

this case, Goff was served by delivery of the motion to its counsel of record, John

Fabiani, via Federal Express. See generally Fed. R. Civ. P. 5(b)(1) (“[s]ervice ... on a

party represented by an attorney is made on the attorney unless the court orders service on

the party.”).

Service by mail on Goff’s attorney was proper. Service of a motion to confirm the

arbitration award by a U.S. Marshal is unnecessary where a party is already before the

court. Smiga v. Dean Witter Reynolds, Inc., 766 F.2d 698, 707 (2d Cir. 1985); see also

Fed R. Civ. P. 5(a) (distinguishing between the complaint and subsequent pleadings). 

Since Goff was before the District Court in the Eastern District of Pennsylvania and that

court had explicitly maintained jurisdiction in the matter after granting XL ancillary relief

and staying its proceedings, service by mail on Goff’s attorney of record was permissible

under Fed. R. Civ. P. 5(b)(1) & (b)(2)(B).

Second, Goff argues that it was “fundamentally unfair” for the District Court in

Pennsylvania to grant the motion to confirm without considering the later-filed motion to

vacate the award pending before the District Court in the Middle District of Alabama. 

Goff fails to cite any authority for the proposition that a later-filed motion to vacate in one

court divests another district court of jurisdiction to hear a motion to confirm. Thus, the

District Court was correct when it noted that the “pendency of a later-filed motion to

vacate the arbitration award in the Alabama District Court did not divest this court of
6

jurisdiction over the motion to confirm.” District Court Order (July 9, 2004). 

Moreover, the FAA authorizes district courts to confirm arbitration awards when

the parties agreed to have the arbitration award entered as a judgment by the court. Isidor

Paiewonsky Assoc., Inc. v. Sharp Prop. Inc., 998 F.2d 145, 154 n. 11 (3d Cir. 1993); 9

U.S.C. § 9. Here, the parties agreed to confirmation in the Eastern District of

Pennsylvania. Therefore, the District Court’s exercise of jurisdiction was proper.

Finally, none of the alleged prejudices suffered by Goff rise to the level of

“extraordinary circumstances.” For example, Goff does not dispute that it received notice

of the motion to confirm, only that service was improper. Goff’s decision not to

challenge the motion to confirm in the Eastern District of Pennsylvania was a calculated

litigation maneuver which is not entitled to reversal via the mechanism of Rule 60(b)(6). 

Ackermann, 340 U.S. at 198. 

IV. Conclusion

For the reasons explained above, the District Court’s order denying relief pursuant

to Fed. R. Civ. P. 60(b) is affirmed.