Raymone Bain v. MJJ Productions, Inc. , 751 F.3d 642 ( 2014 )


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  •  United States Court of Appeals
    FOR THE DISTRICT OF COLUMBIA CIRCUIT
    Argued December 6, 2013                Decided May 13, 2014
    No. 12-7061
    RAYMONE K. BAIN AND DAVIS, BAIN & ASSOCIATES, INC.,
    APPELLANTS
    v.
    MJJ PRODUCTIONS, INC. AND ESTATE OF MICHAEL JOSEPH
    JACKSON,
    APPELLEES
    Appeal from the United States District Court
    for the District of Columbia
    (No. 1:09-cv-00826)
    Joseph M. Creed argued the cause for appellants. With him
    on the briefs were Steven M. Pavsner and Levi S. Zaslow.
    Henry W. Asbill argued the cause for appellees. With him
    on the briefs were Jennifer Bradley Lichter, Howard L.
    Weitzman, and Jeremiah T. Reynolds. Ryan J. Watson entered
    an appearance.
    Before: BROWN and SRINIVASAN, Circuit Judges, and
    WILLIAMS, Senior Circuit Judge.
    2
    SRINIVASAN, Circuit Judge: In December 2003, the late
    entertainer Michael Jackson retained Davis, Bain & Associates,
    Inc., to act as his public relations firm. One of the firm’s
    founders, Raymone Bain, began serving as a spokesperson and
    publicist for Jackson, later becoming his general manager. In
    May 2009, Ms. Bain and her firm (collectively, Bain) sued
    Jackson and his production company, MJJ Productions, Inc.,
    claiming to be owed substantial sums for various services
    rendered. Those services included arranging the release of a
    25th anniversary edition of Jackson’s album, Thriller, generally
    recognized to be the best-selling album in history. The
    defendants (collectively, MJJ) moved to dismiss, relying
    principally on a December 2007 release agreement signed by
    Jackson and Bain. In the release agreement, Bain broadly
    relinquished any claims against Jackson and his business
    entities. The district court granted summary judgment in favor
    of MJJ, holding that the release agreement precluded Bain’s
    claims.
    Five months later, Bain moved for relief from judgment
    under Federal Rule of Civil Procedure 60(b)(2). Rule 60(b)(2)
    allows for relief based on “newly discovered evidence that, with
    reasonable diligence, could not have been discovered in time to
    move for a new trial.” The “newly discovered evidence” cited
    by Bain was an April 2008 letter from Jackson to Bain, in which
    Jackson stated that he had no awareness of, and had never
    signed, the release agreement on which the district court had
    grounded its grant of summary judgment. The district court
    denied the Rule 60(b)(2) motion. Because we find no abuse of
    discretion in the district court’s ruling that Bain failed to
    exercise reasonable diligence in seeking out the April 2008
    letter, we affirm.
    3
    I.
    According to the complaint, in May 2006, Bain and Jackson
    entered into a Personal Services Agreement. The agreement
    authorized Bain to incorporate a new company (the Michael
    Jackson Company) on Jackson’s behalf, and appointed her the
    new company’s president and chief operating officer. As
    compensation, she would receive a “10% Finder’s fee of any
    Agreement(s) entered into by Michael Jackson, or the Michael
    Jackson Company, generated by, or due to the direct efforts of
    Bain and/or Bain’s contacts.” J.A. 31. Bain alleged that she
    initiated a number of such projects, for which she claims to be
    owed compensation amounting to at least $44 million. Bain
    brought suit against MJJ in federal district court, invoking the
    court’s diversity jurisdiction.
    MJJ moved to dismiss the complaint based on a “Payment
    and Release Agreement” (the Release) signed by Bain in
    December 2007, which MJJ claimed absolved it of liability
    under the Personal Services Agreement. The Release provided
    that Jackson would render a payment to Bain in the amount of
    $488,820.05, as “full and final satisfaction of any [and] all
    monies, known or unknown, to be owed to you by the Jackson
    Parties with respect to any and all agreements whether verbal or
    written that you may have entered into with the Jackson Parties
    from the beginning of time until December 27, 2007.” J.A. 104.
    One week after MJJ filed its motion to dismiss, Jackson
    unexpectedly died.
    In opposing dismissal, Bain argued that the Release was
    defective due to fraud in the inducement, misrepresentation, and
    mistake. Bain also contended that the Release was facially
    ambiguous, permitting consideration of parol evidence to
    interpret the contract. Bain asserted that she intended to
    discharge claims for past debts and liabilities, not claims
    concerning future work or deals yet to be finalized. In addition,
    4
    Bain expressed doubt about the authenticity of Jackson’s
    signature on the Release. Finally, she requested the opportunity
    to conduct discovery to support her challenges.
    Because the defendants’ motion to dismiss relied on matters
    outside the pleadings—namely, the Release—the district court
    converted the motion into one for summary judgment. The
    court granted both sides additional time to supplement the
    record with “all the material that is pertinent to the motion.”
    J.A. 274-75. Bain’s attorney filed an affidavit under Federal
    Rule of Civil Procedure 56(d), stating that, if permitted by the
    court, Bain would conduct discovery concerning Jackson’s
    intent in the Release and the authenticity of his signature.
    On May 7, 2010, the district court granted summary
    judgment in favor of the defendants, holding that the
    unambiguous language of the Release barred Bain’s claims. See
    Bain v. Jackson, 
    783 F. Supp. 2d 13
    , 17 (D.D.C. 2010). The
    court rejected Bain’s contentions that the Release was voidable
    due to fraud in the inducement or mistake. 
    Id. at 17-18.
    The
    court also denied Bain’s requests for discovery. 
    Id. at 18
    n.4.
    Bain did not appeal the district court’s grant of summary
    judgment against her.
    On October 4, 2010, Bain moved for relief from judgment
    based on “newly discovered evidence,” pursuant to Rule
    60(b)(2). The “newly discovered” evidence cited in support of
    the motion was an April 24, 2008, letter faxed from Jackson to
    Bain. The letter stated:
    I have never terminated your services nor did I null and
    void any of your Agreements. I know nothing about a
    release form. I neither authorized or signed the same.
    Therefore, I am authorizing you to continue to
    communicate with Mr. Yakoob regarding the Sultan’s
    property in Las Vegas, and to continue your role as my
    5
    General Manager and President/COO of The Michael
    Jackson Company.
    J.A. 414.
    In an accompanying affidavit, Bain explained that she had
    received the letter “in connection with the work Mr. Jackson
    expected me to continue to perform on his behalf.” Bain Aff. ¶
    4. Bain now says that the letter referenced “the Sultan’s
    property” because, at the time, Jackson had been searching for
    a permanent residence and had expressed interest in a property
    owned by the Sultan of Brunei. When Jackson inquired about
    the property in early 2008, Bain raised the issue of the Release.
    Jackson responded with the April 2008 letter.
    According to Bain’s affidavit, an unnamed consultant who
    worked for the Michael Jackson Company had taken a collection
    of files from Bain’s office, and those files included the April 24,
    2008, letter. The consultant had been handling real estate
    matters for Jackson. When the consultant completed his
    responsibilities in 2008, he “boxed up the information regarding
    properties and took that information home with him, including
    the file on the Sultan of Brunei’s property,” which contained the
    April letter. Bain Aff. ¶ 4. The consultant returned the box of
    files to Bain in “late June, or early July, 2010,” after Jackson’s
    death, and after the district court’s entry of summary judgment.
    
    Id. Bain stated
    that she “did not know the April 24, 2008, letter
    was in this box, or that it was in the Sultan of Brunei’s file,” and
    she did not examine the contents of the box until late August
    2010. 
    Id. ¶ 5.
    When she opened the Sultan’s file, she
    discovered the letter, which “had been misfiled . . . in a file
    labeled, ‘The Sultan of Brunei Finance.’” 
    Id. She further
    stated:
    6
    Not in my wildest imagination did I suspect that a box
    containing documents relating to real properties would
    contain any material relating to my relationship or
    employment with Mr. Jackson before this Court. I
    knew I had correspondence from Mr. Jackson, but I
    could not find it. I made a diligent search of all the
    records and files in my office. I did not know, nor was
    I able to look in the Sultan of Brunei’s file, which was
    in the possession of the consultant. I looked for this
    file for months, spending many, many hours looking
    into all of the files which were in my office, but it was
    no where [sic] to be found.
    
    Id. On June
    7, 2012, the district court denied Bain’s Rule
    60(b)(2) motion. Bain v. Jackson, No. 09-826, Mem. Op. &
    Order (D.D.C. June 7, 2012). The court based its denial on two
    independent grounds. First, the court held that, because Bain
    knew about Jackson’s April 2008 letter at the time of trial, the
    letter could not be considered “newly discovered” evidence
    within the meaning of Rule 60(b)(2). 
    Id. at 4.
    Second, the court
    held that Bain failed to exercise “due diligence” in attempting to
    discover the letter. 
    Id. at 4-5.
    The court explained that Bain
    made no reference to the letter in any filings, and thus “cannot
    be said to have conducted due diligence in attempting to procure
    it.” 
    Id. at 5.
    II.
    Federal Rule of Civil Procedure 60(b) sets forth various
    grounds upon which a party may obtain relief from a judgment.
    Rule 60(b)(2) allows for relief based on “newly discovered
    evidence that, with reasonable diligence, could not have been
    discovered in time to move for a new trial.” Fed. R. Civ. P.
    60(b)(2). A district court considering a motion for relief from
    7
    judgment under Rule 60(b) must “strike a ‘delicate balance
    between the sanctity of final judgments . . . and the incessant
    command of a court’s conscience that justice be done in light of
    all the facts.’” Twelve John Does v. District of Columbia, 
    841 F.2d 1133
    , 1138 (D.C. Cir. 1988) (alteration in original)
    (quoting Good Luck Nursing Home, Inc. v. Harris, 
    636 F.2d 572
    , 577 (D.C. Cir. 1980)) (some internal quotation marks
    omitted). The trial judge, “who is in the best position to discern
    and assess all the facts, is vested with a large measure of
    discretion in deciding whether to grant a Rule 60(b) motion.”
    
    Id. We thus
    review the denial of a Rule 60(b)(2) motion for
    abuse of discretion, but we consider underlying legal issues de
    novo. Marino v. Drug Enforcement Admin., 
    685 F.3d 1076
    ,
    1080 (D.C. Cir. 2012). Here, we disagree with the district
    court’s first ground for denying Bain’s Rule 60(b)(2) motion,
    but we affirm on the basis of the district court’s second ground.
    A.
    The district court first held that Bain’s knowledge of
    Jackson’s April 2008 letter at the time of trial precluded the
    grant of Rule 60(b)(2) relief. In the court’s view, “‘evidence
    cannot be newly discovered’” for purposes of Rule 60(b)(2) “‘if
    it was known to the party at the time of trial.’” Mem. Op. at 4
    (quoting Lightfoot v. District of Columbia, 
    555 F. Supp. 2d 61
    ,
    68 (D.D.C. 2008)). We disagree.
    It is true that Bain “knew” of the letter at the time of trial in
    the sense that she then knew of its existence. In the view of MJJ
    and the district court, awareness of evidence during trial
    necessarily compels denying relief under Rule 60(b)(2),
    regardless of the evidence’s availability at that time. Evidence
    known to a party at trial, MJJ argues, cannot qualify as “newly
    discovered” in a post-judgment motion. MJJ emphasizes one
    definition of “discover”: “to obtain for the first time sight or
    knowledge of.” Webster’s Third New International Dictionary
    8
    647 (3d ed. 1986). “Discover,” however, can also mean “to
    detect the presence of,” i.e., to “find,” id.; or “to make known or
    visible,” i.e., to “expose,” Merriam-Webster’s Collegiate
    Dictionary 357 (11th ed. 2011); see also Webster’s New
    International Dictionary 647 (2d ed. 1947) (similar definitions).
    Under those definitions, evidence that was lost, hidden, or
    unavailable during trial could qualify as “newly discovered
    evidence” when later found, even if the evidence was known to
    the movant at the time of trial.
    We think that understanding better squares with the purpose
    and operation of Rule 60(b)(2) than one in which mere
    awareness of evidence would forever preclude its consideration
    as “newly discovered.” If awareness of evidence alone were
    automatically to foreclose its treatment as “newly discovered,”
    evidence known to a party could never form the basis of Rule
    60(b)(2) relief even if it had been unavailable during trial or
    summary judgment proceedings due to circumstances entirely
    beyond the party’s control. For instance, if critical documentary
    evidence were known to have existed at one time but had been
    presumed by all to have been destroyed in a natural disaster, a
    party would have no ability to seek relief from judgment even if
    the pivotal document were later discovered unexpectedly to have
    been moved before the disaster and to have survived in an
    unanticipated place. See Serio v. Badger Mut. Ins. Co., 
    266 F.2d 418
    (5th Cir. 1959). We perceive no basis for concluding that
    Rule 60(b)(2) categorically precludes the grant of relief in such
    situations, with no consideration given to the particular
    circumstances. Rather, Rule 60(b), while respecting “the
    sanctity of final judgments,” allows that “justice be done in light
    of all the facts.” Twelve John 
    Does, 841 F.2d at 1138
    (internal
    quotation marks omitted).
    No decision of this Court suggests that mere awareness of
    evidence during trial, standing alone, categorically precludes
    later treating the evidence as “newly discovered” under Rule
    9
    60(b)(2). Nor, to our knowledge, has any other court of appeals
    so held. MJJ cites the observation of the First Circuit in one
    decision that, “[i]n order for evidence to be newly discovered,
    the party seeking a new trial must be unaware of the existence
    of the evidence before or during the trial.” Parrilla-Lopez v.
    United States, 
    841 F.2d 16
    , 19 (1st Cir. 1988). In that case,
    however, the court did not rely on the movant’s mere awareness
    of the evidence. The court instead explained that the movant
    knew of the evidence but chose not to “present[] [it] to the
    district court because of [his] conscious decision on trial
    strategy.” 
    Id. Evidence intentionally
    withheld, the court
    reasoned, “is not grounds for a new trial.” 
    Id. Whereas the
    First
    Circuit based its decision on a movant’s tactical decision to
    withhold evidence accessible to him, here the district court held
    that a movant’s awareness of evidence automatically precludes
    relief under Rule 60(b)(2), regardless of the evidence’s
    availability. We find that to be an unduly constricted
    understanding of “newly discovered evidence” for purposes of
    Rule 60(b)(2).
    B.
    While awareness of evidence, standing alone, does not
    categorically preclude considering the evidence to be “newly
    discovered” under Rule 60(b)(2), a party’s unannounced
    awareness of evidence can affect the assessment of whether it
    exercised the “reasonable diligence” contemplated by the Rule.
    Fed. R. Civ. P. 60(b)(2). The district court held that Bain “failed
    to exercise due diligence in seeking out the 2008 letter” because
    Bain knew of the letter’s existence but made no mention of the
    letter in any submission to the court. Mem. Op. at 4-5. The
    district court did not abuse its discretion in so ruling.
    According to Bain’s recital of the relevant events, the “newly
    discovered” evidence at issue—the April 2008 letter—had been
    faxed by Jackson to Bain in April of that year. The copy of the
    10
    letter submitted by Bain thus bears facsimile time-stamps. The
    necessary implication is that at least one copy other than the one
    in Bain’s possession had been in existence: the original letter.
    As Bain herself points out, that “original was presumably within
    the possession, custody or control of Mr. Jackson’s Estate.” And
    as Bain further observes, “[c]ounsel for [the Jackson Parties]
    should have had . . . a copy of this document in their possession
    since April, 2008.” Bain Aff. ¶ 3. In such circumstances, even
    if the faxed copy was believed lost, missing, or destroyed, a party
    exercising reasonable diligence should have sought to obtain the
    original from the defendants, either by requesting the court’s
    assistance or directly contacting the defendants. See Yachts Am.,
    Inc. v. United States, 
    779 F.2d 656
    , 662 (Fed. Cir. 1985)
    (affirming denial of Rule 60(b)(2) motion based in part on
    movant’s failure to seek an alternate copy of a document from
    the government, the adverse party).
    Bain emphasizes her search of her own files to locate the
    letter. But while Bain’s examination of her own files may bear
    on the assessment of reasonable diligence, it does not end the
    inquiry. Bain’s efforts to find her own copy of the letter did not
    relieve her of all responsibility to undertake reasonable efforts to
    obtain the original letter (or a separate copy) from Jackson, his
    estate, or his counsel. And by failing to apprise the district court
    of the letter, Bain denied the court any opportunity to assist with
    locating it. See Zurich N. Am. v. Matrix Serv., Inc., 
    426 F.3d 1281
    , 1290 (10th Cir. 2005) (finding lack of due diligence
    because movant knew certain documentation was missing but
    “made no attempt to explicitly include it in the discovery
    process”); Lans v. Gateway 2000, Inc., 
    110 F. Supp. 2d 1
    , 6
    (D.D.C. 2000) (denying Rule 60(b)(2) relief because movant
    “should have notified the Court and the defendants as to [the
    evidence’s] potential existence and requested time to locate it”).
    Bain contends that she adequately sought the district court’s
    assistance by requesting the court to permit discovery about the
    11
    circumstances surrounding the Release, including the
    authenticity of Jackson’s signature on the Release. But even if
    she framed the scope of her intended discovery with sufficient
    breadth to encompass Jackson’s April 2008 letter, there is a
    material distinction between generally seeking discovery, on one
    hand, and specifically mentioning the letter, on the other. Under
    Rule 56(d), “a court may deny a motion for summary judgment
    or order a continuance to permit discovery if the party opposing
    the motion adequately explains why, at that timepoint, it cannot
    present by affidavit facts needed to defeat the motion.” Strang
    v. U.S. Arms Control & Disarmament Agency, 
    864 F.2d 859
    , 861
    (D.C. Cir. 1989) (second emphasis added). In making that
    determination, courts consider whether the movant offers
    “specific reasons demonstrating the necessity and utility of
    discovery to enable her to fend off summary judgment.” 
    Id. In our
    view, a reasonably diligent party seeking to oppose summary
    judgment and convince a court to permit additional discovery
    would ordinarily mention specific evidence it seeks that would
    support its position. That is especially the case concerning
    evidence a party considers to be as pivotal as Bain contends is
    the case with Jackson’s April 2008 letter. Had she alerted the
    court to the existence of the letter, she would have materially
    strengthened her case in opposition to the grant of summary
    judgment and in favor of an opportunity to conduct discovery.
    Bain, however, ultimately offers no justification for her
    failure to mention the 2008 letter to the district court, to seek the
    court’s assistance in locating a copy, or to ask the defendants for
    any copy in their possession. Nor does she suggest that any such
    efforts to locate the letter could not have borne fruit. See In re
    Hope 7 Monroe St. Ltd. P’ship, 
    743 F.3d 867
    , 873-74 (D.C. Cir.
    2014). In those circumstances, the district court did not abuse its
    discretion in finding that Bain failed to exercise reasonable
    diligence.
    12
    The circumstances of this case are far afield from those in
    Serio v. Badger Mutual Insurance Company, on which Bain
    heavily relies. The Rule 60(b) motion in Serio concerned
    inventory records that had been inadvertently left outside a
    factory’s fire-proof safe on the night the factory was destroyed
    by a 
    fire. 266 F.2d at 419
    . Some months later, the factory owner
    discovered that an employee had moved the inventory records
    into a storage room outside of the factory a few days before the
    fire, where they had survived unscathed. 
    Id. at 420.
    The Fifth
    Circuit rejected the argument that the owner’s failure to search
    for the records amounted to a lack of due diligence. 
    Id. at 420-
    21. In Serio, the inventory records were presumed to be
    destroyed, and there was no reason to suppose that there existed
    any additional copies. Here, by contrast, Bain’s own copy of the
    letter was presumed to be missing rather than destroyed, and
    there was every reason to suppose that there existed at least one
    additional copy. The fact that Bain attempted to search her own
    files—whereas the owner in Serio evidently undertook no
    search—thus is of little assistance to her. The district court
    committed no abuse of discretion by looking beyond Bain’s
    efforts in searching her own files and considering whether she
    mentioned the letter to the court or sought its assistance in
    locating the evidence.
    * * * * *
    We affirm the district court’s judgment denying relief under
    Rule 60(b)(2). Bain now, for the first time, also attempts to
    invoke alternative Rule 60(b) grounds for relief, alleging
    misconduct by the defense pursuant to Rule 60(b)(3) and error on
    the part of her prior counsel pursuant to Rule 60(b)(6). Because
    those arguments were not presented to the district court in the
    first instance, we decline to entertain them. See Potter v. District
    of Columbia, 
    558 F.3d 542
    , 550 (D.C. Cir. 2009) (“‘It is well
    settled that issues and legal theories not asserted at the District
    Court level ordinarily will not be heard on appeal.’”) (quoting
    13
    District of Columbia v. Air Fla., Inc., 
    750 F.2d 1077
    , 1084 (D.C.
    Cir. 1984)).
    So ordered.