NONPRECEDENTIAL DISPOSITION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 November 26, 2014*
Decided December 1, 2014
Before
ANN CLAIRE WILLIAMS, Circuit Judge
DIANE S. SYKES, Circuit Judge
DAVID F. HAMILTON, Circuit Judge
No. 14‐2471
WILLIAM JACKSON, Appeal from the United States District
Plaintiff‐Appellant, Court for the Northern District of Illinois,
Eastern Division.
v.
No. 13 C 2533
OWENS CORNING/FIBREBOARD
ASBESTOS PERSONAL INJURY Elaine E. Bucklo,
SETTLEMENT TRUST, Judge.
Defendant‐Appellee.
O R D E R
Owens Corning Corporation, a manufacturer of fiberglass insulation, filed for
Chapter 11 bankruptcy in 2000 amid a slew of asbestos‐related litigation. The company’s
reorganization plan—approved by the bankruptcy court in 2006—created the Owens
Corning/Fibreboard Asbestos Personal Injury Settlement Trust, which assumed all of the
* After examining the briefs and the record, we have concluded that oral
argument is unnecessary. Thus the appeal is submitted on the briefs and the record.
See FED. R. APP. P. 34(a)(2)(C).
No. 14‐2471 Page 2
company’s liabilities for asbestos‐related personal‐injury claims. See 11 U.S.C. § 524(g).
The plan also established procedures for processing such claims. William Jackson
submitted a claim to the Trust. The claim was rejected, first by the Trust and later by an
arbitrator. Jackson sued the Trust in Illinois state court, lost, and then sued the Trust
again in federal court. The district court concluded that claim preclusion barred the suit
and entered judgment for the Trust. Nine months later, Jackson filed a motion for
reconsideration, which the district court denied. Jackson challenges that ruling. Because
we conclude that the district court acted well within its discretion when it denied
Jackson’s motion, we affirm.
Section 524(g) of the Bankruptcy Code, 11 U.S.C. § 524(g), allows a bankrupt
company facing claims for damages “caused by . . . asbestos” to create a trust that will
assume the company’s asbestos liabilities. The provision also empowers bankruptcy
courts to enter an injunction that channels such claims to the trust. See In re W.R. Grace &
Co., 729 F.3d 311, 315, 319–20 (3d Cir. 2013); In re Quigley Co., 676 F.3d 45, 48 (2d Cir.
2012). To protect future claimants’ right to due process, the statute imposes
requirements, not at issue here, that must be satisfied before the bankruptcy court may
issue a channeling injunction. See In re Federal‐Mogul Global Inc., 684 F.3d 355, 359 & n.9
(3d Cir. 2012) (describing the statutory requirements); In re Combustion Eng’g, Inc., 391
F.3d 190, 234 & n.45 (3d Cir. 2004) (same). For our purposes, it is important only to note
that trusts established under § 524(g) designate distribution procedures that govern the
processing and payment of claims. See Federal‐Mogul, 684 F.3d at 360 & n.12 (describing
the typical distribution procedures).
When the Trust rejected Jackson’s claim, he requested that the claim be submitted
to nonbinding arbitration, as provided by the governing distribution procedures. The
arbitrator determined that Jackson was not entitled to any compensation, entered an
award of $0 on July 8, 2010, and sent a notice of the decision to the parties on July 13.
Under the Trust’s procedures, a claimant may reject the arbitrator’s decision and
commence litigation only if he notifies the Trust of the rejection within 30 days after the
decision is issued. Otherwise, the arbitrator’s decision is “deemed accepted by both
parties.”
Jackson waited until August 20, 2010, to notify the Trust of his wish to reject the
arbitrator’s decision, thus missing the 30‐day deadline. He then sued the Trust in the
Circuit Court of Cook County. The court dismissed the suit, concluding that it was
barred because Jackson had not timely rejected the arbitration award. The Appellate
No. 14‐2471 Page 3
Court of Illinois affirmed, and the Supreme Court of Illinois denied Jackson’s petition for
leave to challenge the appellate court’s ruling.
Jackson then repeatedly sued the Trust in federal court. His first two federal suits
were dismissed because he did not allege any basis for subject‐matter jurisdiction.
Jackson sued a third time, asserting diversity jurisdiction: he is a citizen of Illinois and he
alleged in his complaint that the trustees are citizens of South Carolina, Texas, and
Wisconsin. The Trust moved to dismiss the suit as barred by claim preclusion, and the
district court granted the motion on that ground. Nine months later Jackson moved for
reconsideration under Rule 60(b). He maintained that the Trust had fraudulently
obtained its state‐court victory by submitting false medical evidence. Thus, he argued,
the state‐court judgment should not have foreclosed his federal suit. The district court
denied the motion, and Jackson appeals that decision.
Before addressing the merits of Jackson’s appeal, we briefly comment on two
jurisdictional issues that the Trust has raised. The Trust contends that Jackson’s motion
for reconsideration challenges the state court’s judgment and thus is barred by the
Rooker‐Feldman doctrine. This contention is incorrect. The Rooker‐Feldman doctrine “deals
with situations in which the state court’s decision is the source of the harm that the
federal suit is designed to redress.” Simmons v. Gillespie, 712 F.3d 1041, 1043 (7th Cir.
2013) (emphasis added); GASH Assocs. v. Vill. of Rosemont, Ill., 995 F.2d 726, 728 (7th
Cir. 1993). Although Jackson’s motion for reconsideration suggests that he is unhappy
with the state‐court judgment, the harms that he seeks to redress through his federal suit
arise from the asbestos‐related injuries he says he suffered and the Trust’s refusal to
compensate him for those alleged injuries. None of these harms stems from the state
court’s decision.
The Trust alludes to another jurisdictional issue by stating in its brief that, “as one
of the Trustees . . . is a citizen of Illinois, the parties lacked complete diversity of
citizenship.” Although we generally will examine a district court’s subject‐matter
jurisdiction, the Trust’s suggestion comes too late. This is not a direct appeal; Jackson is
appealing from an attempted collateral attack on a final judgment, and subject‐matter
jurisdiction generally “may not be attacked collaterally” by a party. Travelers Indem. Co.
v. Bailey, 557 U.S. 137, 152 (2009) (internal quotation mark omitted); see In re Lodholtz, 769
F.3d 531, 534 (7th Cir. 2014).
As to the merits, we conclude that Jackson’s appeal is baseless. We review the
denial of a motion under Rule 60(b) for abuse of discretion, see Nash v. Hepp, 740 F.3d
No. 14‐2471 Page 4
1075, 1078 (7th Cir. 2014), and there is no question that the district court’s decision to
deny Jackson’s motion was reasonable. Jackson argued in the motion that claim
preclusion should not bar his federal suit because the Trust had obtained its state‐court
victory by submitting false medical evidence. But for two reasons this argument cannot
justify relief under Rule 60(b). First, Jackson could have raised the argument before
judgment was entered by the district court, and “Rule 60(b) may not be used to
propound new legal theories that could have been raised prior to entry of judgment.”
Parvati Corp. v. City of Oak Forest, Ill., 630 F.3d 512, 516 (7th Cir. 2010); see Provident Sav.
Bank v. Popovich, 71 F.3d 696, 698 (7th Cir. 1995). Second, even on its own terms Jackson’s
argument is fallacious. Medical evidence did not influence the state courts; the state trial
and appellate courts both explained that Jackson could not sue the Trust because he had
not provided timely notice that he was rejecting the arbitrator’s award. Thus, the state
courts reasoned, he was bound by the arbitrator’s decision. The district court therefore
reasonably left its own judgment intact.
AFFIRMED.