Court Opinion

ID: 36762
Source: CourtListenerOpinion
Date Created: 2010-04-25 19:44:29+00
Date Added: 2024-06-11T14:56:49.247470
License: Public Domain

United States Court of Appeals
                                                                                    Fifth Circuit
                                                                                 F I L E D
                     IN THE UNITED STATES COURT OF APPEALS
                                                                                 October 19, 2004
                              FOR THE FIFTH CIRCUIT
                                                                              Charles R. Fulbruge III
                               __________________________                             Clerk

                                      No. 04-40508
                                   Summary Calendar
                               __________________________

In The Matter Of: LEO ROGERS DUGAS,

                                                                                     Debtor.
                 ___________________________________________________

LEO ROGERS DUGAS; VALERIE DARLENE DUGAS,
                                                                                 Appellants,

versus

CLARON CORP.,

                                                                                   Appellee.

                 ___________________________________________________

     Appeal from the United States District Court for the Eastern District of Texas
                              (No. 1:02-cv-00679-RC)
              ___________________________________________________

Before GARZA, DeMOSS, and CLEMENT, Circuit Judges.
                 *
PER CURIAM:

         Before the Court is an appeal from the district court’s order denying a motion to

reopen the case and a request for relief pursuant to Fed. R. Civ. P. 60(b)(4). For the reasons

         *
        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not be published and is not precedent except under the limited circumstances set forth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.
that follow, we affirm the judgment order of the district court.

                             I. FACTS AND PROCEEDINGS

       On August 24, 2001, the United States Bankruptcy Court for the Eastern District of
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Texas [“bankruptcy court”] entered a sanctions order from which Claron Corporation

[“Claron”] appealed. Claron moved for relief from judgment of the sanctions order

pursuant to Bankruptcy Rule 9024 [the “Rule 60(b) motion”]. On October 24, 2001, the

bankruptcy court conducted a hearing on this motion.

       The bankruptcy court conducted the hearing pursuant to Winchester v. United

States Attorney for the Southern District of Texas, 68 F.3d 947 (5th Cir. 1995), which

acknowledges the jurisdiction of a trial court (in this case, a bankruptcy court),

notwithstanding the prior filing of a notice of appeal, to “take action in aid of [an] appeal

[before] the case is remanded to it by the appellate court.” Id. at 949 (internal citations and

quotations omitted). Following the hearing, on October 25, 2001, the bankruptcy court

entered a notice of intent to grant, upon remand from the district court, Claron’s Rule 60(b)

motion.

       On July 8, 2002, the district court transmitted to the bankruptcy court an order

entered on May 28, 2002, dismissing Claron’s appeal from the bankruptcy court. The

bankruptcy court considered the order dismissing the appeal as authorization to proceed

to grant the Rule 60(b) motion, and vacate the sanctions order, which it did on August 22,

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             The sanctions order was styled: “Final Order Granting in Part and
Denying in Part Debtor’s Motion to Disgorge and Transfer of Funds Into the Registry of
the Court and Awarding Damages for Willful Violations of the Automatic Stay.”

                                              2
2002. Appellants Leo and Valerie Dugas [the “Dugases”] appealed this order to the district

court, asserting that the bankruptcy court had lacked jurisdiction to grant Claron’s Rule

60(b) motion.

       On July 24, 2003, the district court affirmed the bankruptcy court’s order granting

the Rule 60(b) motion. The matter was then remanded to the bankruptcy court for further

proceedings. The Dugases filed in this Court a petition for a writ of mandamus, seeking

immediate review of the district court’s order, which was denied on December 3, 2003.

The Dugases then moved the district court to reopen the case and requested relief pursuant

to Rule 60(b) [the “second Rule 60(b) motion”] on March 8, 2004. The Dugases argued that

the district court’s July 24 order affirming the bankruptcy court’s order was void, because

the district court’s May 28, 2002 order had divested the bankruptcy court of jurisdiction.

       On April 13, 2004, the district court denied the second Rule 60(b) motion. The

Dugases timely appeal from the April 13 order.

                               II. STANDARD OF REVIEW

       We review a district court’s decision to grant or deny relief under Rule 60(b) for

an abuse of discretion. See Anglin v. Local Union 1351, Int'l Longshoremen's Ass'n, 102

Fed. Appx. 367, 370 (5th Cir. 2004) (citing New Hampshire Ins. Co. v. Martech USA,

Inc., 993 F.2d 1195, 1200 (5th Cir. 1993)).

                                     III. DISCUSSION

       Appellants Leo and Valerie Dugas [the “Dugases”] argue that the district court’s

judgment affirming the decision of the bankruptcy court is void because it is contrary to

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this Court’s decision in Winchester v. United States Attorney for the Southern District of

Texas, 68 F.3d 947 (5th Cir. 1995). Winchester affirmed the proposition that once a party

notices appeal, the district court is divested of jurisdiction except to “take action in aid of

the appeal” or to correct clerical errors under Fed. R. Civ. P. 60(a). Id. at 949. In

Winchester, this Court examined the situation where a district court considers a Rule 60(b)

motion filed after a notice of appeal, and distinguished between a district court’s denying

such a motion, or granting it. Id. While denying a Rule 60(b) motion is permissible as

action in furtherance of the appeal, “‘[w]hen the district court is inclined to grant the 60(b)

motion, . . . then it is necessary to obtain the leave of the court of appeals. Without

obtaining leave, the district court is without jurisdiction, and cannot grant the motion.’”

Id. (quoting Travelers Ins. Co. v. Liljeberg Enters., 38 F.3d 1404, 1407 n.3 (5th Cir. 1994)).

       In this case, the Dugases argue that under Winchester, the bankruptcy court was

without jurisdiction to grant Claron’s Rule 60(b) motion because the bankruptcy court did

not “obtain leave” to grant the motion. They contend that therefore, the district court’s

July 24, 2003 affirming the bankruptcy court’s order is void. The question whether the

bankruptcy court obtained leave from the district court, however, is a red herring.

Winchester explains that: “a notice of appeal divests the district court of jurisdiction

‘except to take action in aid of the appeal until the case is remanded to it by the appellate

court . . . .” Id. (emphasis added). Here, the case was remanded to the bankruptcy court

when the district court dismissed the appeal on May 28, 2002.             Consequently, the

bankruptcy court incontrovertibly had jurisdiction to grant the Rule 60(b) motion.

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      As the district court correctly found, the Dugases’ appeal is wholly without merit

and, therefore, is DISMISSED as frivolous. See 5TH CIR. R. 42.2; Howard v. King, 707 F.2d

215, 219-20 (5th Cir. 1983). The Dugases are cautioned that filing additional frivolous

motions, suits, or appeals may result in the imposition of sanctions.

                                  IV. CONCLUSION

      For the foregoing reasons, the decision of the district court is AFFIRMED.

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