* Pursuant to 5th Cir. R. 47.5, the court has determined that this opinion should not be published and is not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 16, 2006 Charles R. Fulbruge III Clerk IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

05-30718 IN THE MATTER OF: ABBY LINES INC., Debtor, LUCY G. SIKES, TRUSTEE ON BEHALF OF ABBY LINES INC., Appellant,
versus PROGRESSIVE BANK: PROGRESSIVE BANCORP INC.; GEORGE CUMMINGS, III; JOE DOUGHTY, Appellees. Appeal from the United States District Court fo r the Western District of Louisiana
Before KING, STEWART and DENNIS, Circuit Judges. PER CURIAM: * Bankruptcy trustee Lucy Si kes (“the Trustee”), on behalf of Abby Lines, appeals the district
court ’s judgment dated June 24, 2005, affirming the bankruptcy court’s November 2, 2004, judgment, denying the Trustee’s Rule 60(b) mo tion and dismissing the adversary proceeding in favor of Progressive Bank, Progressive Bancorp, Inc., George Cum mings, III and Joe Doughty2

(“Progressive Bank Parti es”). Because we find that the district court did not abuse its discretion, we affirm. I. FACTUAL AND PROCEDURAL BACKGROUND This appeal relates to an underlying dispute between Abby Lines and the Progressive Bank Parti es stem

ming from Abby Lines’s bankruptcy proceedings; the Trustee was subsequently added. Before the Trustee was added, however, the parti es drafted an agreement detailing certai n negotiated terms regarding Abby Lines’s reorganization, including an automatic release of all claims by Abby Lines against the Progressive Bank Parti es. The bankruptcy judge narrowly tailored this agreement to only include a release of lender liabilit y claims (as originally negotiated); however, aft er Abby Lines converted it s Chapter 11 bankruptcy to a liquidation under Chapter 7, the judge determined the agreement moot. Several mo nt hs aft er this conversion, the Trustee filed suit in Loui siana state court against the Progressive Bank Parti es alleging, amo ng oth er claims, breach of fiduciary duty and frau d. The Progressive Bank Parti es removed the mat ter to the federal d ist ri ct court contendi ng that the
com plaint filed against it by the Trustee was barred by the previous agreement between the parti es. The Trustee maint ained that no such agreement existed, as the bankruptcy court had determ ined the agreement and it s content effectively mo ot. Accordingly, the Progressive Bank Parties filed a motion to di smiss t he adversary proceeding on the basis that the bank had obtai ned an automatic release of all claims in the aforementioned agreement and the bankruptcy court eventually granted that mo tion. In response, the Trustee filed a mo tion to reconsider and an objection to the court’s j udgment. Accordingly, the distr ict court denied the Trustee’s motion for reconsideration, but directed the bankruptcy court to conduct an evidentiary heari ng related to the agreement. As directed, the1 Federal Rule of Civil Procedure 60(b) is made applicable to bankruptcy proceedings th rough Rule 9024 of the Federal Rules of Bankruptcy Procedure. 3 bankrupt cy court held the hearing and affirmed its previous determination and dismissal of the Trustee’s action. Unsatisfied wit h this decision, the Trustee again appealed to the district court and raised what the district court determined to be a Rule 60(b) motion under the Federal Rules of Civil Procedure fo r rel ief from the bankruptcy court’s ruling. The district court affirmed the judgment of the bankruptcy court, explaining t hat it had no authority to allow discovery or enlarge the record o n appeal. Furthermore, the district court reasoned that the bankruptcy court had rej ected “almost identical arguments” when it effectively dealt wit h the Trustee’s Rule 60(b) mo tion. The Trustee now appeals the ruling of the district court regarding the Rule 60(b) motion. II. DISCUSSION A bankruptcy court’s denial of a mo tion to reconsider or denial of relief under Rule 60(b) is reviewed fo r an abuse of discretion. In re Stangel , 68 F.3d 857, 859 (5th Cir. 1995) (per curiam). Further, we will review the district court’s determ inat io n “by applying the same standards of review it applied to the bankruptcy court’s ruling.” I n re Pettle , 410 F.3d 189, 191 (5th Cir. 2005) (citing In re Pro-Snax Distrib., Inc. , 157 F.3d 414, 4 19-20 (5th Ci r.1998)). Thi s is a stringent standard. “It is not enough that the granting of relief might have been permissible, or even warranted[;] denial must have been so unwarranted as to consti tute an abuse of discretion.” S even Elves, Inc. v. Eskenazi , 635 F.2d 396, 402 (5th Cir. 1981). A party can challenge the validity of a court order based on fraud or mistake under Rule 60(b) of the Federal Rules of Civil Procedure. 1 Rule 60(b) provides that:4 On motion and upon such terms as are just, the court may relieve a party or a party ’s legal representative from a final judgment, order, or proceeding fo r the fo llo wing reasons: (1) mist ake, inadvertence, surp ri se, or excusable neglect;
. . . (3) fraud (whether heretofore denominated int ri nsic or extrinsic), misrepresentation, or other misconduct of an adverse party.
Fed. R. Civ. P. 60(b) (2006). A party mo ving fo r relief under the fraud provision of Rule 60(b) must “establish by clear and convincing evidence (1) th at the adverse party engaged in fraud or other misco nduct and (2) that this misco nduct prevented the mo ving party from fully and fairly presenting his case.” G ov’t Fin. Serv. One Ltd. P’ship v. Peyton Place, Inc. , 62 F.3d 767, 772 (5th Cir. 1995) (citation om

it ted). Accordingly, Rule 60(b) is primarily an instrument of equitable relief; it is not to be “made a vehicle for the relitigation of issues.” I n re Tucker , 211 F.3d 125, *1 (5th C ir . 2000) (unpublished) (citing Banker’s Mort. Co. v. United States , 423 F.2d 73, 79 (5th Cir. 1970)). In it s order, relying on Warner v. City ofBay St. Louis , 526 F.2d 1211, 1213 (5th Cir. 1976), the district court explained that a “[R]ule 60(b) mo tion must fir st be made in the court which entered the judgment or order

– here, the bankruptcy court.” Therefore, the district court reviewed the record in this case and determ ined that the Trustee had effectively raised a Rule 60(b) mo tion before the bankruptcy court via a motion to reconsider. It al so determ ined that the bankruptcy court correctl y denied the mo tion aft er conducting two days of evidentiary hearings, allo wing fo r additional discovery, and accepting additional briefing from the parti es. Accordingly, the district court held that the bankruptcy court did not abuse it s discretion in denying the Trustee’s mo tion to reconsider based
on fraud or mist ake, as the evidence did not support this basis of relief. Likewise, we hold that the district court did not abuse it s discretion when it denied the Trustee’s appeal on the issue of fraud or mist ake. III. CONCLUSION5

The judgment of the district court is AFFIRMED.