Fed Trade Commission v. Natl Bus Consultants, et a

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
October 12, 2007
No. 06-30528 Charles R. Fulbruge III
Clerk
FEDERAL TRADE COMMISSION
Plaintiff - Appellee
CLAUDE C LIGHTFOOT, JR, for the corporation, various
entities and property in which America First Communications,
Inc, Voice of America, Inc and Namer, Inc, own or control
an interest
Receiver - Appellee
v.
ROBERT NAMER; NAMER INC; AMERICA FIRST COMMUNICATIONS
INC; VOICE OF AMERICA INC;
Defendants - Appellants
Appeals from the United States District Court
for the Eastern District of Louisiana
USDC No. 2:89-CV-1740
Before JONES, Chief Judge, and STEWART and CLEMENT, Circuit Judges.
PER CURIAM:*
*
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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.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.
No. 06-30528
Robert Namer (“Namer”), along with Namer, Inc., America First
Communications, Inc., Voice of America, Inc., and other corporate entities
(collectively, the “Corporations”) appeal the district court’s orders of April 5,
2006, April 26, 2006, and May 26, 2006, affirming ten orders of the magistrate
judge and denying Namer’s motion for recusal of the district court judge. We
AFFIRM.
I. FACTS AND PROCEEDINGS
In 1989, the Federal Trade Commission (“FTC”) filed a lawsuit against
Robert Namer and National Business Consultants, Inc. (“NBC”), alleging
violations of the Federal Trade Commission Act (“the Act”), 15 U.S.C. § 45(a)(1)-
(2), and the “Franchise Rule,” 16 C.F.R. Part 436. The Franchise Rule proscribes
a variety of unfair or deceptive acts and practices by franchisors or franchise
brokers in connection with the offering and sale of franchises and business
opportunity ventures. See 16 C.F.R. Part 436. After a bench trial, the court
found that “Namer was conducting a franchise operation in NBC and that
Namer had violated the FTC’s Franchise Rule by misrepresentations and
omissions” to potential franchisees. FTC v. Nat’l Bus. Consultants, Inc., No. 89-
1740, 1990 WL 32967, at *1 (E.D. La. Mar. 20, 1990). The court granted a
permanent injunction, restraining Namer and NBC from further violations of
the Act and the Franchise Rule. Id. at *9. In November 1991, the district court
entered judgment against Namer and NBC in the amount of $3,019,377.00.
Despite efforts by the FTC to enforce the judgment, Namer and NBC never
paid the debt. In July 2002, the FTC moved to conduct a judgment debtor
examination, in accordance with the Federal Debt Collection Procedures Act
(“FDCPA”), 28 U.S.C §§ 3001–3308, and Rule 69(a) of the Federal Rules of Civil
Procedure to discover whether Namer had any further assets that could be
acquired to satisfy the judgment. After examination, the district court found
that Namer had “violated the [FDCPA] by purposefully transferring income and
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assets to Namer, Inc., America First Communications, Inc., Voice of America,
Inc., and by incurring debt and making loans to Friends of Robert Namer
calculated to hinder, delay and avoid collection of the judgment against him.”
FTC v. Namer, No. 89-1740, 2003 WL 193503, at *3 (E.D. La. Jan. 27, 2003). On
April 8, 2003, the district court amended its judgment, adding the Corporations
as defendants and judgment debtors.1
By May 2005, over thirteen years after the entry of judgment, Namer and
the Corporations had paid only $140,149.79 toward the judgment. After the FTC
became convinced by Namer’s statements and actions that he would continue his
attempts to evade payment of the debt,2 it moved to appoint a receiver to account
for Namer’s income and to manage and liquidate his assets and those of the
Corporations. Pursuant to 28 U.S.C. § 3203(e), the district court appointed
Claude Lightfoot (“Receiver”) on May 31, 2005 to assume complete control over
Namer’s assets and the Corporations themselves.
Together, the FTC and the Receiver continued efforts to enforce the
judgment.3 Three recent orders of the district court ruling on numerous issues
1
Namer and NBC appealed the decision, but this Court affirmed the district court’s
order. FTC v. Nat’l Bus. Consultants, Inc., 376 F.3d 317, 318 (5th Cir. 2004), cert. denied, 544
U.S. 904 (2005).
2
The record reveals at least three occasions where the district court revoked fraudulent
transfers of assets that Namer had made to his children and other insiders. To further delay
payment of the judgment, Namer filed a separate lawsuit against the Receiver in May 2006,
alleging defamation and theft. The district court dismissed the case for failure to state a claim
and barred Namer and his colleagues from filing further complaints or proceedings, citing his
“calculated abuse of the administration of justice” and stating that “this nonsensical abuse
must come to an end.” Namer v. Lightfoot, No. 06-2511, slip op. at 1 (E.D. La. July 25, 2006),
appeal docketed, No. 06-30906 (5th Cir. Aug. 31, 2006). In June 2006, prior to the district
court’s order prohibiting further frivolous filings, the Corporations and a host of Namer’s
colleagues also filed suit against the Receiver, alleging negligence and breach of fiduciary duty.
The district court dismissed the lawsuit for failure to state a claim. Nat’l Bus. Consultants, Inc.
v. Lightfoot, No. 06-3191, slip op. at 1 (E.D. La. Aug. 2, 2006), appeal docketed, No. 06-30896
(5th Cir. Aug. 30, 2006).
3
In addition to pursuing satisfaction of the judgment through these proceedings, the
Receiver filed a separate lawsuit in October 2006, seeking the revocation of a fraudulent
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are the focus of this appeal.4 We find that Namer’s arguments lack merit,
making this appeal indicative of his repeated and consistent attempts to delay
the enforcement of the judgment against him.
II. STANDARD OF REVIEW
This Court reviews de novo a district court’s conclusions of law, and its
findings of fact are reviewed for clear error. Rimade Ltd. v. Hubbard Enters.,
Inc., 388 F.3d 138, 142 (5th Cir. 2004). We also review the denial of a motion to
recuse for abuse of discretion. Andrade v. Chojnacki, 338 F.3d 448, 454 (5th Cir.
2003) (citing Trevino v. Johnson, 168 F.3d 173, 178 (5th Cir. 1999)); United
States v. Merkt, 794 F.2d 950, 960 (5th Cir. 1986).
III. DISCUSSION
A. Scope of Jurisdiction
The parties do not dispute the jurisdiction of this Court pursuant to 28
U.S.C. § 1291 to review all appeals from final judgments of district courts. We
transfer of real property from America First Communications to a third-party company. The
district court adopted the magistrate judge’s report and recommendations, finding that Namer
intended to defraud the FTC to avoid the judgment against him and granting summary
judgment to the Receiver. Lightfoot v. Miss Lou Props., L.L.C., No. 05-3776, slip op. at 1 (E.D.
La. Oct. 11, 2006), appeal docketed, No. 06-31210 (5th Cir. Nov. 27, 2006).
4
The district court’s order of April 5, 2006 adopted two of the magistrate judge’s reports
and recommendations, granting the Receiver’s motion to approve auction and bidding
procedures for the sale of radio station assets and the form of an asset purchase agreement,
and denying the Receiver’s motion to exclude Namer from participating in depositions. The
district court’s April 5, 2006 order also denied Namer’s motion for Judge Beer’s recusal. The
district court’s April 26, 2006 order affirmed the following six orders of the magistrate judge:
(1) denial of Namer’s motions to vacate the order to appoint a receiver and to declare personal
property exempt from seizure, (2) denial of Namer’s motion to dismiss on the basis of accord
and satisfaction and the Corporations’ motion for an accounting, (3) denial of Namer’s motion
to remove the attorney for the Receiver, (4) denial of Namer’s motion for stay of seizure and
for access to all files and tapes, (5) grant of the Receiver’s motion to appoint a certified public
accountant to assist the Receiver, and (6) denial of Namer’s motion for relief from judgment
pursuant to Rule 60(b). The district court’s May 26, 2007 order affirmed the magistrate judge’s
order denying enrollment of Cary J. Deaton as counsel to Namer, Inc., America First
Communications, Inc., and Voice of America, Inc. Namer timely appealed the district court’s
orders.
4
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must, however, consider the scope of our jurisdiction in this case sua sponte. See
Okpalobi v. Foster, 190 F.3d 337, 343 (5th Cir. 1999).
“Rule 3(c) of the Federal Rules of Appellate Procedure requires that the
notice of appeal specify the order from which the appeal is taken.” Hinsley v.
Boudloche (In re Hinsley), 201 F.3d 638, 642 (5th Cir. 2000). “Nevertheless, a
policy of liberal construction of notices of appeal prevails . . . [when] the intent
to appeal an unmentioned or mislabeled ruling is apparent and there is no
prejudice to the adverse party.” Id. (internal quotation omitted). In his original
and amended notices of appeal, Namer stated his intent to appeal the district
court’s postjudgment orders of April 5, 2006, April 26, 2006, and May 26, 2006.
But he raises two issues for appeal in his brief and reply brief that are outside
the scope of this proceeding and are not enumerated in his notices of appeal,
claiming that the district court’s bar on future filings in parallel lawsuits filed
by Namer and the Corporations, see supra note 2, prohibits him from filing
effective, timely appeals on rulings in those cases.
The reality is that the three cases involving Namer, although obviously
related, were never consolidated by the district court. Further, this Court has
docketed appeals in both of the parallel cases filed by Namer and the
Corporations. Therefore, because some of the issues Namer raises for appeal do
not arise from the case now before this Court, and the FTC and the Receiver
would be significantly prejudiced if Namer is allowed to advance those issues at
this time, this Court will entertain only those appellate arguments arising from
this case and arising from the district court’s orders of April 5, 2006, April 26,
2006, and May 26, 2006 listed in the notices of appeal. Specifically, this Court
will not consider Namer’s argument that the district court abused its discretion
and violated Namer’s due process rights when it prohibited all future frivolous
filings in Namer v. Lightfoot, No. 06-2511, slip op. at 1 (E.D. La. July 25, 2006),
appeal docketed, No. 06-30906 (5th Cir. Aug. 31, 2006). Nor will this Court
5
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consider Namer’s argument that the district court abused its discretion in
allowing the Receiver to seize property that Namer argues is leveraged beyond
its value. This argument appears to be a summary of the Corporations’ claims
in National Business Consultants, Inc. v. Lightfoot, No. 06-3191, slip op. at 7–14
(E.D. La. June 19, 2006), appeal docketed, No. 06-30896 (5th Cir. Aug. 30, 2006).
B. District Court’s Order of April 5, 2006
1. Motion to grant auction and bidding procedures
The district court adopted the magistrate judge’s report and
recommendation granting the Receiver’s motion to approve auction and bidding
procedures for Namer’s radio station assets. Although Namer expressly stated
his intent to appeal this decision in his notice of appeal, neither party briefed the
issue. Because “[i]nadequately briefed issues are deemed abandoned,” this Court
will not consider this issue. United States v. Charles, 469 F.3d 402, 408 (5th Cir.
2006).
2. Judicial recusal
The district court also denied Namer’s motion of March 31, 2006,
requesting Judge Peter Beer to recuse himself pursuant to 28 U.S.C. § 455.
Before evaluating Namer’s individual complaints regarding Judge Beer’s
conduct, it is important to provide context by examining the backdrop of events
in the record that have occurred over the course of the last eighteen years.
This litigation started in 1989 and was assigned to Judge Veronica Wicker.
During Judge Wicker’s oversight of the case, Namer filed two motions to recuse
the judge, resulting in the case’s reassignment to Judge Charles Schwartz, Jr.
in July 1991.5 Judge Schwartz presided over the case until September 1992,
5
In her order recusing herself from this case, Judge Wicker wrote:
It has been recently brought to the undersigned’s attention that Robert Namer
. . . has used on a continuing basis a local radio station’s “talk” show to unjustly
and maliciously attack the integrity and impartiality of the Court. . . . While the
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when the case was reassigned to Judge Beer, who commented on the
circumstances surrounding both of these recusals:
This case has a long and acrimonious history starting with
Namer’s attacks on the Honorable Veronica Wicker and in like
manner, upon the Honorable Charles Schwartz, Jr. The Court will
spare the record of the details of those attacks, except to say that in
each instance, they resulted in the judge taking himself or herself
out of the case and sending it to the clerk’s office for re-allotment.
FTC v. Nat’l Bus. Consultants, No. 89-1740, 2003 WL 1797891, at *2 (E.D. La.
Apr. 3, 2003). From January 1993 to March 2006, Namer moved to recuse Judge
Beer from the case four times, alleging that the judge had verbally abused him
and threatened him and his family legally. In response to Namer’s third request
for recusal, Judge Beer wrote:
It is the resolve of this Court to see this matter through, fairly and
evenhandedly, all other considerations to the contrary
notwithstanding. I have not and will not waver from this
commitment nor will I let the impartial and evenhanded
administration of justice be hamstrung by calculated personal
attacks against my family and myself. Part of the overall
responsibility of serving as United States District Judge is to do
one’s job fairly and impartially. This is what I have done and will
continue to do.
FTC v. Nat’l Bus. Consultants, Inc., No. 89-1740, 2003 WL 1797891, at *2 (E.D.
La. Apr. 3, 2003). Judge Beer denied Namer’s fourth motion to recuse on April
5, 2006 without a hearing. It is that motion that is at issue before us now.
undersigned has no personal prejudice towards any litigant in this or any other
matter before her, it is conceivable that defendant Namer’s personal and highly
publicized vendetta, no matter how unjust or malicious, could cause needless
concern for some reviewing authority.
FTC v. Nat’l Bus. Consultants, Inc., No. 89-1740, slip op. at 1–2 (E.D. La. July 23, 1991).
Indeed, although Namer did not hide the fact that he broadcasted his concerns about Judge
Wicker, he painted his actions in a different light: “[D]efendants sought relief by exposing
Judge Wicker’s prejudicial and unconstitutional actions to the public in a two hour radio
broadcast on May 27, 1991.”
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A federal judge must “disqualify himself in any proceeding in which his
impartiality might reasonably be questioned.” 28 U.S.C. § 455(a). A judge must
also disqualify himself under various circumstances enumerated in § 455(b),
including situations “[w]here he has a personal bias or prejudice concerning a
party, or personal knowledge of disputed evidentiary facts concerning the
proceeding.” Id. § 455(b)(1).
We have established three guidelines for interpreting § 455. See Andrade
v. Chojnacki, 338 F.3d 448, 454–55 (5th Cir. 2003). First, we must use an
objective standard for evaluating bias. Id. (citing Vieux Carre Prop. Owners,
Residents & Assocs. v. Brown, 948 F.2d 1436, 1448 (5th Cir. 1991)). Next, our
“review should entail a careful consideration of context, that is, the entire course
of judicial proceedings, rather than isolated incidents.” Id. at 455 (citing Sao
Paulo State of Federative Rep. of Brazil v. Am. Tobacco Co., 535 U.S. 229, 232–33
(2002)). Lastly, we must consider the origin of a judge’s alleged bias, otherwise
known as the application of the “extrajudicial source rule.” Id. (citing Liteky v.
United States, 510 U.S. 540, 555 (1994)). “As articulated by the Supreme Court,
this rule more or less divides events occurring or opinions expressed in the
course of judicial proceedings from those that take place outside of the litigation
context and holds that the former rarely require recusal[.]” Id. To summarize,
in order to demonstrate that the district court’s refusal to recuse constituted an
abuse of discretion, Namer must “(1) demonstrate that the alleged comment,
action, or circumstance was of ‘extrajudicial’ origin, (2) place the offending event
into the context of the entire trial, and (3) do so by an ‘objective’ observer’s
standard.” Id. We find that he fails to satisfy these standards.
Namer makes numerous claims that he contends establish Judge Beer’s
partiality and bias. He claims that Judge Beer made derogatory and biased
remarks about Namer in courtroom proceedings; accused Namer of participating
in criminal activity and making inflammatory statements on the radio; granted
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No. 06-30528
ex parte motions filed by the FTC; reversed the magistrate judge’s order to
return Namer’s vehicle; made insulting comments about Namer’s religion in a
written order; refused to have an ex parte conversation with Namer in chambers;
and used his position in this case to gain vengeance against Namer and a
business colleague, Keith Rush.6
Most of these claims arise from “intrajudicial” sources which do not
ordinarily furnish the basis for recusal. Liteky, 510 U.S. at n.3. In fact,
“opinions formed by the judge on the basis of facts introduced or events occurring
in the course of the current proceedings, or of prior proceedings, do not constitute
a basis for a bias or partiality motion unless they display a deep-seated
favoritism or antagonism that would make fair judgment impossible.” Id. at
550–51. Therefore, Namer’s claims regarding biased and derogatory remarks
made by Judge Beer in courtroom proceedings, even if credible, require a more
deferential review and do not fall within the range of behavior that would make
fair judgment impossible.7 Indeed, “expressions of impatience, dissatisfaction,
annoyance, and even anger” do not establish bias or partiality. Id. at 555–56.
6
Since the case was assigned to Judge Beer in September 1992, Namer has moved four
times to recuse the judge: January 1993, January 2003, April 2003, and March 2006. Judge
Beer took the first three motions under submission and later denied each one. In his latest
motion to recuse, Namer not only alleged behavior of the judge occurring since April 2003, the
date of the third motion to recuse, but also actions dating back to September 1992. This
Circuit recognizes that § 455 motions must be made timely; indeed, “it is well-settled that—for
obvious reasons—one seeking disqualification must do so at the earliest moment after
knowledge of the facts demonstrating the basis for such disqualification.” Travelers Ins. Co.
v. Liljeberg Enters., Inc., 38 F.3d 1404, 1410 (5th Cir. 1994). Arguably, the district court and
this Court should not consider Namer’s arguments regarding the judge’s alleged behavior
occurring before April 2003 because those bases for recusal have been denied in prior motions
and are now untimely. The alleged behavior that may warrant consideration at this time is
that which has transpired from April 2003 to March 2006 and includes signing various orders
adverse to Namer, refusing to have an ex parte meeting with Namer in chambers, and refusing
to grant Namer an evidentiary hearing on his latest motion to recuse the judge.
7
Most of Namer’s assertions regarding Judge Beer’s behavior reference and rely upon
an unsworn, self-serving affidavit in the record from January 2003, instead of specific entries
in courtroom transcripts or court orders.
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Many of Namer’s complaints can be classified as adverse rulings that also
do not establish personal bias. The Supreme Court has explained:
[J]udicial rulings alone almost never constitute a valid basis for a
bias or partiality motion. In and of themselves (i.e., apart from
surrounding comments or accompanying opinion), they cannot
possibly show reliance upon an extrajudicial source; and can only in
the rarest circumstances evidence the degree of favoritism or
antagonism required . . . when no extrajudicial source is involved.
Almost invariably, they are proper grounds for appeal, not for
recusal.
Id. at 555 (internal citation omitted). Therefore, Namer’s claims that orders
ruling in favor of the FTC or the Receiver reveal Judge Beer’s bias against him
are without merit.
Namer claims that he went to Judge Beer’s chambers without notice on
June 22, 2005 “to clarify his perceptions of the Judge’s actions and to clear any
misperceptions the Judge may have about him.” He argues that Judge Beer was
rude to him and that the judge’s pointed and adamant refusal to meet with him
provides evidence of the judge’s partiality. The rules governing judicial ethics
prohibit judges from engaging in substantive ex parte communications
concerning pending matters. MODEL CODE OF JUDICIAL CONDUCT R. 2.9 (2007).
Accordingly, we find this complaint is without merit.
Namer’s final allegations of Judge Beer’s bias are also insufficient. Namer
claims that “he has been advised that Judge Beer will reverse any relief he gets
from the Magistrate,” and that “he has been advised that Judge Beer has stated
that he wants to make sure Namer will never be able to broadcast or earn a
living in New Orleans.” Further, Namer contends that Judge Beer had ulterior
motives for closing Namer’s radio station that were “compounded by a decades’
old vendetta against a long time broadcaster who worked at [Namer’s radio
station], Keith Rush, who . . . contradicted a statement [that Judge Beer] made
during a political race.” Namer, however, has not substantiated these claims nor
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No. 06-30528
demonstrated that Judge Beer’s alleged actions were of extrajudicial origins by
an objective observer’s standard.
In addition to Namer’s claims for recusal, he also argues that he should
have been afforded a hearing to present evidence of Judge Beer’s bias. We note
that a party filing a motion for recusal does not have an automatic right to
establish a record in open court or participate in an evidentiary hearing, nor
does a need even exist for an evidentiary hearing if the facts presented by a
party seeking recusal are insufficient on the face of the motion. See United
States v. Barnes, 909 F.2d 1059, 1072 (7th Cir. 1990). “[S]ection 455 must not
be so broadly construed that it becomes, in effect, presumptive, so that recusal
is mandated upon the merest unsubstantiated suggestion of personal bias or
prejudice.” United States v. Cooley, 1 F.3d 985, 993 (10th Cir. 1993) (internal
quotation omitted). A review of the record indicates that Namer’s claims for
recusal are either grossly unsubstantiated or, being of intrajudicial origin, do not
qualify as a foundation for a finding of bias. We find that all of Namer’s
arguments for recusal are misplaced; therefore, we find that the district court
did not abuse its discretion when it denied Namer an evidentiary hearing on the
motion to recuse.
Lastly, we highlight the fact that § 455 “is not intended to give litigants
a veto power over sitting judges, or a vehicle for obtaining a judge of their
choice.” Id. (citing United States v. Greenough, 782 F.2d 1556, 1558 (11th Cir.
1986); In re United States, 666 F.2d 690, 694 (1st Cir. 1981)). We find it quite
clear from the record that Namer has used the recusal statute to forum-shop and
delay the enforcement of the judgment against him. But as Judge Beer, paying
homage to François Rabelais, succinctly instructed: “Let down the curtain; the
farce is over.” Namer v. Lightfoot, No. 06-2511, slip op. at 2 (E.D. La. July 25,
2006), appeal docketed, No. 06-30906 (5th Cir. Aug. 31, 2006).
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C. District Court’s Order of April 26, 2006
1. Motions to vacate the order appointing a receiver and to declare personal
property exempt from seizure
In December 2004, as part of the FTC’s ongoing effort to satisfy the
judgment against Namer, the district court granted the FTC’s request for a writ
of continuing garnishment to be served upon a Mississippi corporation, CopyTek-
Tronics, Inc. (“CopyTek”), for any funds due or to become due to either Namer
or the Corporations. CopyTek answered the garnishment interrogatories in
January 2005, indicating no funds were due, but reporting a business
relationship with Voice of America, Inc., one of the Corporations. After notice
of service of the writ of garnishment upon CopyTek, Namer and the Corporations
filed requests for hearing, raising numerous issues concerning the FTC’s
attempts to obtain satisfaction of the judgment. Namer and the Corporations
did not challenge the FTC’s compliance with any statutory requirement for the
issuance of the postjudgment remedy granted under the FDCPA, 28 U.S.C.
§ 3202(d). Rather, their claims concerned the validity of various claims of
exemption by the judgment debtors. After an evidentiary hearing, the
magistrate judge ruled on June 8, 2005 that the only property at issue was any
amount that CopyTek owed to Voice of America, Inc. This resulted in two
findings. First, the exemptions that Voice of America, Inc. sought to claim were
not applicable to corporations; therefore, it could not cite any failure by the FTC
to comply with the statutory requirements of the FDCPA. Second, Namer’s
contentions concerning himself and his personal property were irrelevant to the
proceedings.8
8
Although unnecessary, the magistrate judge considered a few of Namer’s issues raised
at the hearing and advised him that as long as he chose to perform services through the
Corporations, the exemption statutes will not prevent the FTC’s seizure of anything owed to
the Corporations because the exemptions only apply to natural persons, not corporations.
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No. 06-30528
Meanwhile, on May 31, 2005, the FTC applied for writs of execution
concerning assets of Namer and the Corporations. At the same time, the FTC
sought the appointment of a Receiver to avoid any dissipation of assets. See
supra notes 2-3. The district court granted this request on the same day. These
applications had no bearing or relationship to the hearing regarding the
garnishment proceeding involving CopyTek. On June 22, 2005, Namer moved
to amend the order appointing a receiver, and on June 28, 2005, he moved to
vacate the order. He argued that the FTC’s position regarding the pursuit of a
garnishment against CopyTek judicially estopps it from pursuing the
appointment of a receiver. Namer challenged the actions of the FTC in seeking
an ex parte order for the appointment of a receiver and in failing to disclose its
intentions to him during the evidentiary hearing on the CopyTek garnishment.
The magistrate judge denied both motions on the basis that she lacked the
authority to modify or vacate a district court’s order, and Namer did not choose
to file the motions for hearing before the district court.9
Namer now claims that the district court erred in allowing the FTC to
seize and sell his assets and those of the Corporations without requiring it to
follow the mandates of the FDCPA. He claims that his rights under the FDCPA
were violated in four ways: (1) the FTC failed to make a demand for payment
upon the Corporations before filing an application for a writ of garnishment to
be served upon CopyTek, as required by 28 U.S.C. § 3205(b)(1)(B); (2) the district
court failed to schedule a hearing on the writ of garnishment against CopyTek
within ten days or as soon thereafter as practicable; (3) the FTC violated the
stay imposed by 28 U.S.C. § 3014 by obtaining an ex parte order appointing the
9
Although the magistrate judge denied the motions for lack of authority to review the
district court’s order, she did comment on the merits of Namer’s claim, finding that the pursuit
of a garnishment from a third party and the request for a receiver were not inconsistent legal
positions.
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No. 06-30528
Receiver; and (4) the FTC failed to give notice of its motion to appoint the
Reciever. We find these claims to be without merit.
The general requirements for obtaining a writ of garnishment under the
FDCPA state that the FTC must list on the application “the nature and amount
of the debt owed and the facts that not less than 30 days has elapsed since
demand on the debtor for payment of the debt was made and the judgment
debtor has not paid the amount due.” 28 U.S.C. § 3205(b)(1)(B). The record,
however, indicates that Namer and the Corporations did not raise this issue
initially before the magistrate judge. Although they requested an evidentiary
hearing to address claims of exempt property, they did not challenge the FTC’s
compliance with the FDCPA’s statutory requirements. This Circuit has held
that a party who objects to a magistrate judge’s report waives any legal
arguments that were not made first before the magistrate judge. See Cupit v.
Whitley, 28 F.3d 532, 535 & n.5 (5th Cir. 1994). Therefore, this argument is
waived.
Section 3205(c)(5) mandates that “[t]he court shall hold a hearing within
10 days after the date the request is received by the court, or as soon thereafter
as is practicable,” should either party object to the answers to the garnishment
interrogatories submitted by the garnishee, i.e., CopyTek. The requests by
Namer and the Corporations for a hearing regarding CopyTek’s garnishment
interrogatory answers were filed on February 11, 2005. Because “[t]he party
objecting shall state the grounds for the objection and bear the burden of proving
such grounds,” id., a series of answers and replies between Namer and the FTC
followed. On April 7, 2005, the magistrate judge granted the request for the
hearing and scheduled it for April 28, 2005. Both parties moved simultaneously
for a continuance, and so the hearing was continued and held on June 1, 2005.
This Court finds that no prejudice resulted from the continuance; indeed, both
parties requested that the date be moved. We find that, although the hearing
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did not take place within ten days, it occurred “as soon thereafter as [was]
practicable.” Therefore, Namer’s alleged violation of the FDCPA is without
merit.
Namer’s next claim pertains to the stay imposed by 28 U.S.C. § 3014(b)(3),
which requires the FTC to refrain from selling or disposing of seized property for
which an exemption is claimed until the district court determines whether the
debtor has an exempt substantial interest in the property. As noted by the
magistrate judge in her report and recommendations of June 8, 2005, Namer
had no interest himself in the property CopyTek may have owed to Voice of
America, Inc. Arguably, the property at issue did not exist, based on CopyTek’s
answer to garnishment interrogatories that indicated it owed nothing. Even if
property belonging to Voice of America, Inc. could have been seized from the
third party, the exemption statutes do not apply to corporate holdings.
Therefore, § 3014(b)(3) is inapplicable. The FTC was not required to refrain
from selling or disposing of property it could either never seize or which would
never qualify as an exemption.
The FDCPA requires that notice for a complaint, writ, or other process be
given to a debtor “[a]t such time as counsel for the [FTC] considers appropriate,
but not later than the time a . . . postjudgment remedy is put into effect.” 28
U.S.C. § 3004(c). Thus, the FTC did not have an obligation to advise Namer or
the Corporations of the appointment of a receiver at the time the motion was
filed on May 31, 2005.
For these reasons, we find that the district court did not err in affirming
the magistrate judge’s denial of the motions by Namer and the Corporations to
vacate the order appointing the Receiver and to declare personal property
exempt from seizure.
15
No. 06-30528
2. Motion to dismiss on the basis of accord and satisfaction
The district court affirmed the magistrate judge’s denial of Namer’s motion
of July 6, 2005, requesting dismissal of the case on the basis of accord and
satisfaction. We find the district court did not err in affirming the denial of the
motion.10
Accord and satisfaction is a common-law doctrine that “embraces the
discharge of an obligation by a debtor rendering, and a creditor accepting,
performance different from that the creditor claims due.” Fischbach & Moore,
Inc. v. Cajun Elec. Power Coop., Inc., 799 F.2d 194, 197 (5th Cir. 1986). “In its
most common form, an accord and satisfaction exists as a mutual agreement
between the parties in which one pays or performs and the other accepts
payment or performance in satisfaction of a claim or demand which is a bona
fide dispute.” O’Connor v. United States, 308 F.3d 1233, 1240 (Fed. Cir. 2002)
(internal quotation omitted). An “accord” is the parties’ bilateral agreement to
settle the claim once certain conditions are met, such as the payment of an
agreed-upon dollar amount. See Tri-O, Inc. v. United States, 28 Fed. Cl. 463, 470
(1993) (citing Chesapeake & Potomac Tel. Co. v. United States, 654 F.2d 711, 716
(Ct. Cl. 1981)). The “satisfaction” is the performance of that agreement which
occurs when the stated conditions are met. Id. “The three elements essential
to the confection of a valid accord and satisfaction are: (1) a disputed claim, (2)
the debtor’s tendering of a sum less than that claimed by the creditor, and (3) the
creditor’s acceptance of the payment.” United States v. Bloom, 112 F.3d 200, 206
(5th Cir. 1997) (footnotes omitted). This Circuit has observed that “mutual
consent is an absolute requisite to the formation of a contract of accord and
satisfaction.” Fischbach & Moore, 799 F.2d at 198.
10
On July 13, 2005, the Corporations also filed a motion for an accounting of the debt.
On July 6, 2005, however, the FTC provided an accounting of the debt, including costs,
attorneys’ fees, prejudgment interest, and the amounts received in payment toward the debt.
Therefore, the motion is moot.
16
No. 06-30528
Namer has not demonstrated mutual consent between the parties to settle
the debt, nor has he shown acceptance by the FTC of the meager amount paid
by Namer as satisfaction of the judgment. Indeed, for what little monies have
been received by the FTC, the means of collection have always been through
continued litigation and the seizure and sale of Namer’s assets through the U.S.
Marshal’s Office. As such, the magistrate judge’s denial of Namer’s motion to
dismiss on the basis of accord and satisfaction and the district court’s affirmance
of this ruling was proper.
3. Motion to remove attorney for Receiver
On May 31, 2005, the district court appointed the Receiver to assume
control over, manage, and investigate the financial affairs of the Corporations
as Namer’s cojudgment debtors.11 On June 21, 2005, the district court granted
the Receiver’s motion to appoint Emile Turner, Jr. (“Turner”) as his counsel to
assist him in his duties regarding the assets of both Namer and the
Corporations. Namer moved the magistrate judge to vacate the order of the
district court appointing Turner as counsel to the Receiver, arguing that Turner
owed a fiduciary duty to the Corporations and that he violated his fiduciary duty
to protect their assets by not determining that they were mistakenly added as
cojudgment debtors. Aside from the fact that the magistrate judge lacked
authority to vacate an order of the district court, Namer’s motion attempted to
revisit the district court’s decision naming the Corporations as cojudgment
debtors, which was affirmed by this Court. FTC v. Nat’l Bus. Consultants, Inc.,
376 F.3d 317 (5th Cir. 2004), cert. denied, 544 U.S. 904 (2005). Namer did not
move the district court to reconsider or vacate its order appointing counsel to the
Receiver. Therefore, this motion is without merit.
11
On June 17, the district court amended this order to include Namer, Inc. as one of the
entities for which the Receiver had been appointed and to change the value for which the
Receiver would be bonded in accordance with the value of the assets.
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No. 06-30528
4. Motion to stay seizure and sale of assets
The district court affirmed the magistrate judge’s denial of Namer’s motion
to stay the seizure and sale of the Corporations. Although Namer expressly
stated his intent to appeal this decision in his notice of appeal, he did not brief
the issue. Because “[i]nadequately briefed issues are deemed abandoned,” this
Court will not consider this claim. United States v. Charles, 469 F.3d 402, 408
(5th Cir. 2006).
5. Employment of a certified public accountant
The district court affirmed the magistrate judge’s granting of the
Receiver’s request for authority to employ J. Edward Perron, Jr., a certified
public accountant, to assist him in reviewing the books and records of the
Corporations and preparing fiduciary returns on his behalf. Although Namer
objected on behalf of the Corporations, he did not have authority to represent the
Corporations legally. Nevertheless, the magistrate judge found his objections to
be without merit.
Namer expressly stated his intent to appeal this decision in his notice of
appeal, but he did not brief the issues. Because “[i]nadequately briefed issues
are deemed abandoned,” this Court will not consider this claim. Id.
6. Motion for relief from judgment or order12
Namer filed a motion for relief from judgment on August 24, 2005. In the
motion, he requested that the district court vacate its order of May 31, 2005,
appointing the Receiver and the entire judgment against him and the
12
Namer crafted this motion as a motion to dismiss, but cited the provisions of Rule
60(b), which provide for relief from an order or judgment. Although motions to dismiss are
governed by Rule 12, because Namer requested the court to vacate its order appointing a
receiver and relief from the judgment against him, the district court treated the motion as a
Rule 60 motion for relief from judgment.
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No. 06-30528
Corporations.13 Because Namer’s prior motions to vacate the order appointing
the Receiver were properly denied, and because he raised no new grounds
justifying the modification or termination of the Receiver’s appointment, the
district court affirmed the magistrate judge’s denial of this motion. We agree
and turn to Namer’s motion for relief from the entire judgment against him.
Rule 60 provides that, on motion, the district court may relieve a party
from final judgment or order for the following reasons:
(1) mistake, inadvertence, surprise, or excusable neglect; (2) newly
discovered evidence which by due diligence could not have been
discovered in time to move for a new trial under Rule 59(b); (3)
fraud (whether heretofore denominated intrinsic or extrinsic),
misrepresentation, or other misconduct of an adverse party; (4) the
judgment is void; (5) the judgment has been satisfied, released, or
discharged, or a prior judgment upon which it is based has been
reversed or otherwise vacated, or it is no longer equitable that the
judgment should have prospective application; or (6) any other
reason justifying relief from the operation of the judgment.
FED. R. CIV. P. 60(b). “The motion shall be made within a reasonable time, and
for reasons (1), (2), and (3) not more than one year after the judgment, order, or
proceeding was entered or taken.” Id.; see also Wilson v. Johns-Manville Sales
Corp., 873 F.2d 869, 871–72 (5th Cir. 1989) (holding claim under Rule 60(b)(3)
brought two years after entry of judgment was time-barred); Gulf Coast Bldg.
& Supply Co., 460 F.2d 105, 108 (5th Cir. 1972) (holding claim under Rule
60(b)(1) brought one year after entry of judgment was time-barred). The
expiration of the one-year time limit “is an absolute bar to relief from judgment.”
United States v. Marin, 720 F.2d 229, 231 (1st Cir. 1983).
13
The record indicates that Namer has been repeatedly instructed that he cannot
legally represent the interests of the Corporations; he may only appear for himself. The
Corporations are represented by counsel designated by the Receiver, who has the only
authority to exercise full control and management of the Corporations, including hiring legal
counsel to represent their interests. Therefore, to the extent that Namer’s motion seeks any
relief on behalf of the Corporations as cojudgment debtors, it must be denied.
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No. 06-30528
Namer argues that the judgment against him should be removed pursuant
to Rule 60(b)(2), (3), (5), and (6). The district court entered judgment against
Namer in November 1991 and added the Corporations as cojudgment debtors in
April 2003. Although the magistrate judge and district court denied Namer’s
motion for relief from judgment on the merits of these claims, we affirm the
denial for different reasons. Because Namer brought his motion for relief from
judgment over fourteen years after entry of judgment, his claims under Rule
60(b)(2) and (3) are time-barred. Similarly, his claims under Rule 60(b)(5) and
(6) must have been made within a “reasonable time”; fourteen years after entry
of judgment does not qualify as a reasonable time for application of Rule 60.
D. District Court’s Order of March 26, 2006
The district court affirmed the magistrate judge’s order denying in part
and granting in part the Corporations’ motion to enroll Cary J. Deaton
(“Deaton”) as counsel. Namer retained Deaton to represent the Corporations,
pursuant to the court’s August 26, 2005 order, allowing representation of
shareholders, but not of corporate entities under receivership. The Receiver
opposed the motion, arguing that he alone was granted full power by the district
court to control, manage, and liquidate the Corporations’ assets and that this
included the power to retain counsel. The magistrate judge denied Deaton’s
enrollment as counsel for all of the Corporations except for National Business
Consultants, Inc., the only entity not placed under receivership.
Namer appeals this decision and argues that the Corporations are entitled
to independent legal representation and that neither the Receiver nor his
attorney can provide legal counsel for the Corporations without a violation of the
entities’ due process rights. Receivers are bound by fiduciary obligations to the
court appointing them and to the estates they serve. Namer ignores the fact
that the judgment against him and the Corporations as cojudgment debtors is
final. The litigation on the merits has long been concluded and all that is left is
20
No. 06-30528
the liquidation of assets to satisfy the judgment. Therefore, no due process
rights are implicated and, further, Namer has not demonstrated any prejudice
to the Corporations by the Receiver’s actions. We find that the district court did
not err in its findings of March 26, 2006.
IV. Conclusion
We AFFIRM the judgments of the district court in all respects. We also
note that this appeal contained numerous frivolous arguments, “lack[ing] any
support in law or the record,” that are not proper requests for judicial relief.
Chalfy v. Turoff, 804 F.2d 20, 23 (2d Cir. 1986). This Court may impose
sanctions if it determines that an appeal is frivolous. FED. R. APP. P. 38.
“Although we are particularly cautious in the imposition of sanctions against pro
se plaintiffs, such litigants ‘are not granted unrestrained license to pursue
totally frivolous appeals.’” Simmons v. Poppell, 837 F.2d 1243, 1244 (5th Cir.
1988) (quoting Clark v. Green, 814 F.2d 221, 223 (5th Cir. 1987)). Therefore, we
warn Namer that future frivolous filings will not be tolerated. Should he persist
in exploring frivolous appeals, he risks the imposition of sanctions under Rule
38.
21