Court Opinion

ID: 9368545
Source: CourtListenerOpinion
Date Created: 2023-02-04 21:00:24.429341+00
Date Added: 2024-06-11T17:16:09.061407
License: Public Domain

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                                             UNPUBLISHED

                                UNITED STATES COURT OF APPEALS
                                    FOR THE FOURTH CIRCUIT

                                               No. 22-1209

        KIRIL ZAHARIEV

                             Plaintiff - Appellant,

                      v.

        HARTFORD LIFE & ACCIDENT INSURANCE COMPANY,

                             Defendant - Appellee.

        Appeal from the United States District Court for the District of South Carolina, at Beaufort.
        Richard Mark Gergel, District Judge. (9:20-cv-01072-RMG)

        Submitted: November 29, 2022                                      Decided: February 3, 2023

        Before WYNN and RUSHING, Circuit Judges, and KEENAN, Senior Circuit Judge.

        Affirmed by unpublished per curiam opinion.

        Kiril Zahariev, Appellant Pro Se. Nikole M. Crow, Atlanta, Georgia, Lewis Gregory Cook
        Horton, WOMBLE BOND DICKINSON (US) LLP, Charleston, South Carolina, for
        Appellee.

        Unpublished opinions are not binding precedent in this circuit.
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        PER CURIAM:

               Kiril Zahariev appeals from the district court’s order overruling his objections to the

        magistrate judge’s report and recommendation and denying his Fed. R. Civ. P. 60(b)

        motion to reopen his settled case, and the district court’s order denying Zahariev’s motion

        to disqualify the district court judge. Because Zahariev’s claims of error were known to

        him at the time he settled his case, we find that the district court did not abuse its discretion

        in denying Zahariev’s motion to reopen. In addition, the record in this case does not show

        the alleged judicial bias. Accordingly, we affirm.

               Zahariev filed an action in district court seeking to recover unpaid long-term

        disability benefits under a group policy issued by Hartford Life and Accident Insurance

        Company (“Hartford”) pursuant to the Employee Retirement Income Security Act of 1974,

        29 U.S.C. §§ 1001-1461. Several months after the complaint was filed, the magistrate

        judge appointed a mediator who successfully assisted the parties in reaching a settlement

        in October 2020. “[H]aving been advised by counsel for the parties that the . . . action

        ha[d] been settled,” the district court entered an order dismissing the action without

        prejudice. The parties were informed that, if the settlement was not consummated, either

        party could move, within 60 days, to “reopen this action and restore it to the calendar”

        under Fed. R. Civ. P. 60(b). The court explicitly retained the jurisdiction to enforce the

        settlement. (E.R. 678). On October 24, 2020, Zahariev cashed his settlement check; on

        October 28, the parties filed a joint stipulation of dismissal with prejudice pursuant to Fed.

        R. Civ. P. 41.

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               In February 2021, Zahariev moved to reopen the case and set aside the judgment

        pursuant to Fed. R. Civ. P. 60(b)(1), (3), (6), arguing that the case should be reopened based

        on the mediator’s misconduct that led Zahariev to accept an unfavorable settlement. In his

        reply to Hartford’s response to his motion, Zahariev argued, for the first time, that he was

        entitled to relief under Rule 60(b)(3) because Hartford submitted fraudulent responses

        during discovery that materially affected the mediation process. Specifically, he asserted

        that Hartford’s supplemental discovery responses included items “inadvertently” left out

        of its initial responses and falsely stated that “[t]here are no written performance

        evaluations of the vendors.” (E.R. 733).

               The magistrate judge recommended denying Zahariev’s Rule 60(b) motion as

        untimely or, alternatively, on the merits. Zahariev timely filed specific objections to

        several findings from the report and recommendation, including the magistrate judge’s

        analysis of Zahariev’s discovery fraud claim. The district court adopted the magistrate

        judge’s report and recommendation and denied Zahariev’s motion to reopen, without

        specifically addressing the discovery fraud issue.

               Zahariev timely appealed. On appeal, we ruled that the district court erroneously

        failed to consider the discovery fraud issue. Accordingly, we vacated and remanded so

        that the district court could consider Zahariev’s objections regarding this issue. Zahariev v.

        Hartford Life & Accident Ins. Co., 2022 WL 260057 (4th Cir. Jan. 27, 2022) (No. 21-1426).

        On remand, the district court entered a supplemental order addressing and overruling

        Zahariev’s discovery fraud objections. Zahariev again appealed.

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               Rule 60(b) permits a district court to relieve a party from an order on the grounds of

        mistake, inadvertence, excusable neglect, newly discovered evidence, fraud or “any other

        reason that justifies relief.” Fed. R. Civ. P. 60(b). A remedy under Rule 60(b) “is

        extraordinary and is only to be invoked upon a showing of exceptional circumstances.”

        United States v. Welsh, 879 F.3d 530, 536 (4th Cir. 2018) (internal quotation marks

        omitted). Moreover, a decision not to reinstate a settled case under Rule 60(b) has been

        described as “discretion piled on discretion.” See McCormick v. Chicago, 230 F.3d 319,

        327 (7th Cir. 2000) (internal quotation marks omitted). Therefore, a district court’s

        decision not to reinstate should stand absent “substantial danger that dismissal of plaintiff’s

        claims was fundamentally unjust.” Id.

               To prevail on a Rule 60(b)(3) motion (fraud on the court by a party), the movant

        must (1) show that he has a meritorious claim or defense, (2) establish the alleged

        misconduct by clear and convincing evidence, and (3) demonstrate that the misconduct

        prevented him from fully presenting his case. Schultz v. Butcher, 24 F.3d 626, 630 (4th

        Cir. 1994). “After proof of these elements, the court must balance the competing policies

        favoring the finality of judgments and justice being done in view of all the facts, to

        determine within its discretion, whether relief is appropriate in each case.” Id. (internal

        quotation marks omitted).

               Here, the district court offered Zahariev 60 days to move to reopen his case if he

        chose not to consummate the settlement agreement. Rather than moving to reopen the case,

        Zahariev, with knowledge of both the mediator’s alleged improper behavior and Hartford’s

        alleged discovery fraud, chose to cash his settlement check and sign a joint order of

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        dismissal with prejudice. He then waited over three months after the stipulated dismissal

        of his suit and over a month after the expiration of the 60-day period before filing the

        instant Rule 60(b) motion.

               We note that Zahariev argues that he proceeded with the settlement and dismissal

        “based in large part on incomplete and false responses provided by Hartford during the

        discovery stage.” (E.R. 870.) The discovery disputes involved Zahariev’s attempt to

        obtain information regarding the compensation of Hartford’s medical consultants and

        vendors involved in Zahariev’s case.          Zahariev alleges that he was served with

        supplemental responses on October 14, 2020, the night before mediation began. Zahariev

        asserts that he was unable to review the responses in time to be prepared for mediation.

        However, Zahariev provides no reason why he could not have reviewed the documents

        within the 60-day period provided by the district court, and why, instead, he settled the

        case and cashed his settlement check.

               Similarly, Zahariev was well aware of the alleged improper actions of the mediator

        at the time of the settlement. Zahariev specifically asserts that he was forced to settle given

        the mediator’s threat that, if he did not, Hartford would continue to investigate his disability

        and conduct further intrusive surveillance. Presumably, Zahariev is contending that the

        mediator was influencing Hartford to conduct more surveillance. Even if true, Zahariev

        does not explain why the threat of further surveillance caused him to settle prematurely but

        did not deter him from filing to reopen his case. Moreover, Zahariev does not assert that

        the mediator’s statement was untrue; instead, he appears to argue the opposite—that is, that

        Hartford had improperly surveilled him in the past and would likely do it again. In short,

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        Zahariev’s arguments regarding the mediator’s threats or statements about possible

        surveillance are conflicting and unconvincing, and in any event, Zahariev does not explain

        why he could not have raised this claim (and his other mediator-related claims) during the

        60-day window proffered by the district court.

               Given that Zahariev was, or should have been, aware of the alleged discovery and

        mediator abuse at the time he settled his case, he has failed to show extraordinary or

        exceptional circumstances meriting Rule 60(b) relief. Moreover, even if we believed that

        extraordinary or exceptional circumstances exist, the district court did not abuse its

        discretion in finding to the contrary. See Welsh, 879 F.3d at 536 (showing an abuse of

        discretion is a “heavy” burden); see Pagan v. American Airlines, Inc, 534 F.2d 990, 993

        (1st Cir. 1976) (finding no abuse of discretion where district court denied Rule 60(b)

        motion to set aside settlement because Appellant did not move to reinstate within the 60-

        day period provided by the court). Given the great deference due to the district court and

        the high bar to reopen a settled case, we affirm the district court’s order denying Zahariev’s

        Rule 60(b) motion.

               Turning to Zahariev’s judicial bias claim, it is well settled that, “[u]nder 28 U.S.C.

        § 455(a), all ‘judge[s] of the United States’ have a general duty to ‘disqualify [themselves]

        in any proceeding in which [their] impartiality might reasonably be questioned.’” Belue v.

        Leventhal, 640 F.3d 567, 572 (4th Cir. 2011) (quoting 28 U.S.C. § 455(a)). The relevant

        code provision further provides specific “situations requiring recusal, one of which is

        where a judge ‘has a personal bias or prejudice concerning a party, or personal knowledge

        of disputed evidentiary facts concerning the proceeding.’”          Id. (quoting 28 U.S.C.

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        § 455(b)(1)). But the Supreme Court has explained that “both § 455(a) and § 455(b)(1)

        carry an ‘extrajudicial source’ limitation, under which bias or prejudice must, as a general

        matter, stem from ‘a source outside the judicial proceeding at hand’ in order to disqualify

        a judge.” Id. (quoting Liteky v. United States, 510 U.S. 540, 545, 554 (1994)) (other

        citations omitted).

               Zahariev’s claim of judicial bias does not have such an “extrajudicial source” from

        which it stems. Instead, Zahariev bases his argument in this court on the district court’s

        rejection of his claims, failure to consider all of his assertions, and error in failing to

        conduct de novo review. It is well established that “judicial rulings alone almost never

        constitute a valid basis for a bias or partiality motion,” Liteky, 510 U.S. at 555, and the

        record in this case does not reveal any support for the claimed judicial bias. Accordingly,

        Zahariev’s judicial bias claim lacks merit.

               Accordingly, we affirm the district court’s orders denying Rule 60(b) relief and

        denying Zahariev’s motion to disqualify. We grant Hartford’s motion to seal and deny

        Zahariev’s motions to supplement and to file a sur-reply. We dispense with oral argument

        because the facts and legal contentions are adequately presented in the materials before the

        district court and argument would not aid the decisional process.

                                                                                       AFFIRMED

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