NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with
Fed. R. App. P. 32.1
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Submitted May 30, 2012*
Decided May 31, 2012
Before
RICHARD D. CUDAHY, Circuit Judge
JOEL M. FLAUM, Circuit Judge
JOHN DANIEL TINDER, Circuit Judge
No. 11‐2879
JOHN VENTRE, et al., Appeal from the United States District
Plaintiffs‐Appellees, Court for the Northern District of Illinois,
Eastern Division.
v.
No. 92 C 3289
DATRONIC RENTAL
CORPORATION, et al., William J. Hibbler,
Defendants Judge.
APPEAL OF: EDMUND J. LOPINSKI, JR.,
Defendant‐Appellant.
O R D E R
Seventeen years ago Edmund J. Lopinski, Jr., intentionally defaulted a civil suit
claiming that he and other defendants had looted millions from investment pools they
controlled; Lopinski and his lawyers decided that a forthcoming indictment in a parallel
*
The appellees have not submitted briefs and are not participating in this appeal,
and counsel for the appellant has advised that oral argument would not benefit the court.
See FED. R. APP. P. 34(a)(1); CIR. R. 34(f). After examining the appellant’s brief and the record,
we have concluded that oral argument is unnecessary. Thus, the appeal is submitted on the
appellant’s brief and the record. See FED. R. APP. P. 34(a)(2)(C).
No. 11‐2879 Page 2
criminal investigation made defending the civil suit risky. A default judgment later was
entered, and Lopinski also was convicted of wire fraud, 18 U.S.C. § 1343, and sentenced to
prison. See United States v. Lopinski, 240 F.3d 574 (7th Cir. 2001). In 2005 a final judgment
was entered in the civil suit after the remaining defendants had settled with the plaintiffs.
Lopinski, who is now out of prison, has commenced a new round of litigation asserting that
he was the one defrauded. He demands compensation from various persons including the
lawyers who represented the plaintiffs in the civil case.
The facts are these: John Ventre and two others filed a class action in 1992 on behalf
of investors in limited partnerships formed with general partner Datronic Rental
Corporation. Datronic, an Illinois corporation based in Schaumburg, was to use the
investors’ money to acquire capital assets for leasing and eventual liquidation, but the
plaintiffs alleged that Datronic insiders, with the company’s outside lawyers and
accountants turning a blind eye, had diverted to their personal use more than $20 million in
investor funds. The investors accused the defendants of engaging in racketeering and
fraud, and they specifically linked Lopinski, the president and controlling stockholder of
Datronic, to expenditures for personal stakes in a Chicago condominium project and
Schaumburg office building, a lakefront condominium and improvements to his suburban
home, two yachts, and an interest in a business jet. Lopinski resigned from Datronic shortly
before the civil suit was filed and transferred title to his holdings to other officers. The
default was entered against him in 1995.
Meanwhile in 1997, with the civil suit still ongoing, Lopinski was indicted. He
pleaded guilty to two counts of wire fraud in April 1998 but afterward moved to withdraw
his guilty pleas. The district court denied that motion in June 1999. A few months later,
shortly before a hearing to determine the plaintiffs’ damages on his 1995 default, see FED. R.
CIV. P. 55(b)(2), Lopinski fired his lawyers in the civil case and filed a pro se motion to
vacate that default, see id. Rule 55(c). The judge presiding over the civil case denied that
motion and in September 2000 found Lopinski still liable to the plaintiffs for $9.1 million.
By then the remaining defendants had settled, and the plaintiffs had partially offset their
losses by liquidating $10.9 million in seized assets. The plaintiffs had not yet sold the
defendants’ interests in the Schaumburg office building, however, so the district court
directed that the building’s appraised value be offset against the $9.1 million owed by
Lopinski. That building sold for more than $10 million in June 2001, and in September the
district court entered an order declaring Lopinski’s liability to the plaintiffs discharged.
In the criminal case Lopinski initially was sentenced to 48 months in prison. On the
government’s cross‐appeal, however, we overturned the downward adjustment he
received for acceptance of responsibility, see U.S.S.G. § 3E1.1, and remanded for
No. 11‐2879 Page 3
resentencing. Lopinski, 240 F.3d at 577. The second time the district court imposed a sentence
of 63 months, which Lopinski did not appeal.
The civil case had been resolved against all of the defendants by November 2000,
and in early 2005 the district court entered a final judgment after the winding down of the
affairs of the Datronic limited partnerships. In all of this time, Lopinski never filed a notice
of appeal from any of the district court’s orders. Then in 2011, through his current lawyer,
Lopinski went back to the district court and filed, under the docket number of the 1992 civil
case, a 98‐page document captioned as a “Verified Petition to Vacate Judgments Obtained
by Fraud on the Court.” This submission, which cites as its jurisdictional basis a case
concerning Federal Rule of Civil Procedure 60(b), levels more than a dozen “charges” of
“fraud on the court” against an array of “conspirators” including the plaintiffs’ lawyers,
Datronic’s outside law firm and the lawyers who defended the firm in the civil action, the
lawyers for other defendants in the civil case, and several Datronic employees who had
worked under Lopinski. According to Lopinski, the company’s outside counsel had blessed
his use of investor funds but reversed themselves later, his own employees had fabricated a
Datronic business report that made him believe he committed fraud, the plaintiffs’ lawyers
had falsely accused him of racketeering and other conspirators had secretly engineered his
federal indictment, some of these conspirators themselves had stolen or squandered
Datronic assets, and the lawyers had lied to the district court about the value of Datronic
assets and other matters in order to gain approval for settlement terms that the lawyers
afterward breached. These are just a sampling of Lopinski’s accusations. As relief he asked
the court to vacate the default judgment, conduct a rerun of the damages hearing, and order
the conspirators to pay him more than $100 million.
Lopinski’s “petition to vacate” confounded the few lawyers who appeared for a
status hearing in June 2011. Counsel for the plaintiffs noted that Lopinski’s filing lists in its
caption very few of the parties to the civil suit and directs many of its accusations against
persons who are not parties. “It’s almost as if it’s a hybrid between a complaint and a
motion,” observed one of the lawyers, without contradiction from Lopinski or his attorney.
The newly assigned district judge—the original judge had retired—also questioned how
new persons could be brought into a lawsuit by way of a postjudgment motion. Again
Lopinski and his lawyer remained silent. The judge invited written responses and set a
deadline, but later the same day the court vacated its directive after noticing a judicial
conflict. Ten days later Lopinski filed a second document, this time asking the district court
to immediately “freeze” funds allegedly still held by one of the Datronic limited
partnerships. The next judge assigned to the case, who interpreted Lopinski’s “petition to
vacate” as being in “the nature of” a motion under Rule 60(b), questioned how it could be
filed in a lawsuit almost 20 years old. When Lopinski replied that “there is no statute of
limitations on these type of actions,” the court answered that Lopinski’s motion to freeze
No. 11‐2879 Page 4
Datronic funds was unreasonable and “not well taken.” To this the court added: “I am not
even sure that the Court should not go further and dismiss this petition, based upon the
fact that the Court feels it is improperly brought and untimely. And that is what the Court
is going to do.”
Lopinski, who does not dispute the district court’s characterization of his “petition
to vacate” as one under Rule 60(b), challenges its dismissal primarily on the ground that the
court did not explain its conclusion that the submission was “improperly brought.” The
unexplained dismissal, says Lopinski, violated our Circuit Rule 50, which provides that a
judge shall give reasons when the court “resolves any claim or counterclaim on the merits,
terminates the litigation . . . or enters an interlocutory order that may be appealed” to this
court. But we have never held that Circuit Rule 50 applies to decisions on Rule 60(b), if that
is what Lopinski filed. As we noted in Stoller v. Pure Fishing Inc., 528 F.3d 478, 480 (7th Cir.
2008), “the matters described in Rule 50 all refer to events leading up to the final judgment
in the case,” while Rule 60(b) provides a means to correct a previously entered decision.
More to the point, though, we conclude that the district court said quite enough. To
begin, Lopinski’s “petition to vacate” is not really a Rule 60(b) motion, at least not in the
main. As plaintiffs’ counsel recognized, what Lopinski filed is a hybrid that, except for a
sliver perhaps falling within Rule 60(b), is really a new lawsuit claiming that mostly new
defendants defrauded him. And it is a new lawsuit that belongs in state court: Lopinski and
most of the persons named in his petition are not diverse, the allegations he makes sound
in common‐law fraud, and Lopinski’s involvement with some of the putative defendants in
past litigation does not create federal subject‐matter jurisdiction even if the prior suit
included federal claims. See Peacock v. Thomas, 516 U.S. 349, 355–56 (1996); Greater Chi.
Combine & Ctr., Inc. v. City of Chi., 431 F.3d 1065, 1069 (7th Cir. 2005); U.S.I. Props. Corp. v.
M.D. Constr. Co., 230 F.3d 489, 498 (1st Cir. 2000); Sandlin v. Corporate Interiors Inc., 972 F.2d
1212, 1214–17 (10th Cir. 1992). Nor does it matter that Lopinski accuses plaintiffs’ counsel of
breaching the settlement terms they reached with the other defendants in the civil case.
Lopinski wasn’t a party to those agreements and has no apparent standing to complain
about their breach. See Jamie S. v. Milwaukee Pub. Sch., 668 F.3d 481, 501 (7th Cir. 2012);
Agretti v. ANR Freight Sys., Inc., 982 F.2d 242, 246 (7th Cir. 1992). Morever, settlements are
contracts, and a claim of breach—even a breach of a settlement agreement that resolved
federal claims in federal court—is a state claim belonging in state court. See Kokkonen v.
Guardian Life Ins. Co. of Am., 511 U.S. 375, 381–82 (1994); Arrow Gear Co. v. Downers Grove
Sanitary Dist., 629 F.3d 633, 637 (7th Cir. 2010); Kay v. Bd. of Ed. of City of Chi., 547 F.3d 736,
737 (7th Cir. 2008).
Additionally, even if we accept that some thread of Lopinski’s filing actually rests on
Rule 60, we still would not require further explanation for the district court’s ruling.
No. 11‐2879 Page 5
Lopinski insists that the district court was wrong in calling his submission untimely, and
while he is correct that a district court has the inherent power to vacate a judgment at any
time because of “fraud on the court,” FED. R. CIV. P. 60(d)(3); Wickens v. Shell Oil Co., 620
F.3d 747, 759 (7th Cir. 2010); Ty Inc. v. Softbelly’s, Inc., 353 F.3d 528, 536 (7th Cir. 2003),
Lopinski’s petition does not allege the type of wrongdoing necessary to gain relief under
subsection (d)(3) from a final judgment in a civil case. Precisely because there is no deadline
for asserting “fraud on the court,” such a motion must allege “the kind of fraud that
ordinarily couldn’t be discovered, despite diligent inquiry, within a year,” such as in cases
where “there are no grounds for suspicion and the fraud comes to light serendipitously.” In
re Golf 255, Inc., 652 F.3d 806, 809 (7th Cir. 2011). The small portion of Lopinski’s petition
that actually challenges his civil judgment—as opposed to raising claims against new
defendants—does not meet this definition. The allegations he raises now—that the
evidence of his misappropriation of investor funds was false and that conflicting evidence
was destroyed—would have been known from the beginning, and Lopinski should have
raised those allegations during the almost three years between the commencement of the
suit and his default. Yet Lopinski raised no defense in his civil case and pleaded guilty in
his criminal case. Lopinski cannot challenge his liability now, six years after he completed
his prison sentence, by recasting his objections to the evidence against him as a claim of
“fraud on the court.”
Accordingly, we AFFIRM the judgment of the district court.
