Court Opinion

ID: 2648323
Source: CourtListenerOpinion
Date Created: 2014-01-07 15:19:17.076285+00
Date Added: 2024-06-11T09:08:38.142315
License: Public Domain

13-0289-bk
Hoti Enterprises v. GECMC

                              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
7th day of January, two thousand fourteen.

Present:    ROSEMARY S. POOLER,
            BARRINGTON D. PARKER,
            DENNY CHIN,
                        Circuit Judges.
_____________________________________________________

HOTI ENTERPRISES, L.P.,

                        Debtor,
_____________________________________________________

HOTI ENTERPRISES, L.P., HOTI REALTY MANAGEMENT CO., INC.,

                                  Appellants,

                            -v-                                               13-0289-bk

GECMC 2007 C-1 BURNETT STREET, LLC,

                        Appellee.
_____________________________________________________

Appearing for Appellants:         Mark A. Frankel, Backenroth Frankel & Krinsky, LLP, New York,
                                  NY.

Appearing for Appellee:           George B. South, III (Daniel G. Egan, on the brief), DLA Piper
                                  LLP (US), New York, NY.
        Appeal from the United States District Court for the Southern District of New York
(Seibel, J.).

     ON CONSIDERATION WHEREOF, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the order of said District Court be and it hereby is AFFIRMED.

        Hoti Enterprises, L.P. and Hoti Realty Management Co., Inc. (collectively, “Hoti”),
appeal from the December 27, 2012 order of the United States District Court for the Southern
District of New York (Seibel, J.), upholding the bankruptcy’s court’s Order Denying Motion for
Relief from Cash Collateral Order. On appeal, Hoti argues that it is entitled to reconsideration of
that order on various grounds provided by Federal Rule of Civil Procedure 60. We assume the
parties’ familiarity with the underlying facts, procedural history, and specification of issues for
review.

        The district court determined that two of the arguments advanced here by Hoti were not
raised before the bankruptcy court, and thus had been waived. Those arguments are: (1) Hoti’s
theory that an October 31, 2011 pro se filing in the bankruptcy court should have been construed
as a timely motion for reconsideration, thus opening up the possibility of reconsideration under
Rule 60(b)(1)-(3); and (2) Hoti’s contention that its counsel did not have permission to execute
the Cash Collateral Order. We agree, and do not consider these arguments on appeal. See Bogle-
Assegai v. Connecticut, 470 F.3d 498, 504 (2d Cir. 2006) (“[I]t is a well-established general rule
that an appellate court will not consider an issue raised for the first time on appeal.” (internal
quotation marks omitted and alteration in original)).

        Further, on appeal, Hoti argues that reconsideration is appropriate under Rule 60(d),
which states a court may “entertain an independent action to relieve a party from judgment,”
Fed. R. Civ. P. 60(d)(1), or “set aside a judgment for fraud on the court,” Fed. R. Civ. P.
60(d)(3). To obtain relief pursuant to Rule 60(d), a claimant must “(1) show that [it has] no other
available or adequate remedy; (2) demonstrate that [its] own fault, neglect, or carelessness did
not create the situation for which [it] seek[s] equitable relief; and (3) establish a recognized
ground—such as fraud, accident, or mistake—for equitable relief.” Campaniello Imports, Ltd. v.
Saporiti Italia S.p.A., 117 F.3d 655, 662 (2d Cir. 1997). The type “‘of fraud necessary to sustain
an independent action attacking the finality of a judgment is narrower in scope than that which is
sufficient for relief by a timely motion [under Rule 60(b)].’” Hadges v. Yonkers Racking Corp.,
48 F.3d 1320, 1325 (2d Cir. 1995) (quoting Gleason v. Jandrucko, 860 F.2d 556, 558 (2d Cir.
1988)).

        The district court correctly held that reconsideration is inappropriate under Rule 60(d)(1)
because Hoti could have brought a claim pursuant to Rule 60(b) within one year of the Cash
Collateral Order but failed to do so. The bankruptcy court did not abuse its discretion in finding
that Hoti was or should have been aware of the fraud it alleges in its reconsideration motion
within the time it had to seek relief pursuant to 60(b). As we have established, failure to raise a
fraud claim within one year under Rule 60(b)(3) precludes a litigant from alleging that the same
fraud entitles it to equitable relief absent extraordinary circumstances. See Campaniello, 117
F.3d at 662-63. Here, the extraordinary circumstances that Hoti alleges on appeal—that its
former counsel was not permitted to enter into the Cash Collateral Order—was not before the
bankruptcy court, as discussed above.

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        Nor do Hoti's allegations constitute fraud upon the court. “Fraud upon the court as
distinguished from fraud on an adverse party is limited to fraud which seriously affects the
integrity of the normal process of adjudication.” Hadges, 48 F.3d at 1325 (internal quotation and
alteration omitted). Indeed, “fraud involving injury to a single litigant” will not, by itself, suffice
to meet the standards of Rule 60(d)(3). See Gleason v. Jandrucko, 860 F.2d 556, 560 (2d Cir.
1988). Accordingly, we affirm the district court's holding with respect to this theory as well.

      We have examined the remainder of Hoti’s arguments, and find them to be without merit.
Accordingly, the order of the district court hereby is AFFIRMED.

                                                       FOR THE COURT:
                                                       Catherine O’Hagan Wolfe, Clerk

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