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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 17-12231
Non-Argument Calendar
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D.C. Docket Nos. 1:12-cv-22275-PAS; 10-bkc-03812-AJC
In re: MAURY ROSENBERG,
Debtor.
__________________________________________________________________
MAURY ROSENBERG,
Plaintiff-Appellee,
versus
DVI RECEIVABLES XIV, LLC,
DVI RECEIVABLES XVI, LLC,
DVI RECEIVABLES XVII, LLC,
DVI RECEIVABLES XVIII, LLC,
DVI RECEIVABLES XIX, LLC,
DVI FUNDING, LLC,
LYON FINANCIAL SERVICES, INC.,
U.S. BANK NATIONAL ASSOCIATION,
Defendants-Appellants,
ASHLAND FUNDING, LLC, et al.,
Defendants.
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________________________
Appeal from the United States District Court
for the Southern District of Florida
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(March 1, 2018)
Before MARCUS, MARTIN and JILL PRYOR, Circuit Judges.
PER CURIAM:
Lyon Financial Services, Inc., U.S. Bank National Association, and the DVI
Entities (collectively, “the Appellants”) appeal the district court’s denial of their
motion for enlargement of time to file a Fed. R. Civ. P. 50(b) motion and their
motion to treat a prior Rule 50(a) motion as a timely Rule 50(b) motion. The
district court ruled that it could not excuse the Appellants’ untimely filing of their
Rule 50(b) motion because, in light of our holding in Advanced Estimating Sys.,
Inc. v. Riney, 130 F.3d 996, 998–99 (11th Cir. 1997), an attorney’s
misunderstanding of a rule’s plain language is not excusable neglect. The court
also held that treating the Appellants’ Rule 50(a) motion as a Rule 50(b) motion
would deviate from our mandate in the prior appeal in this case. On appeal, the
Appellants challenge these determinations. After careful review, we affirm.
I.
The relevant procedural history is this. In 2008, an involuntary Chapter 7
bankruptcy petition was filed against appellee Maury Rosenberg on behalf of the
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DVI Entities. The following year, the bankruptcy court dismissed the petition.
The court retained jurisdiction to award costs, attorney’s fees, and damages under
11 U.S.C. § 303(i). Rosenberg then filed an adversary complaint against the
Appellants under § 303(i), seeking attorney’s fees and costs, plus compensatory
and punitive damages caused by the bad-faith filing of the petition. He later
demanded a jury trial on all triable issues. The Appellants moved the district court
to withdraw the reference of the adversary proceeding so that the case could be
tried in district court. The district court granted the motion, withdrew the reference
of claims for damages, and tried the case to a jury.
The trial was bifurcated into liability and damages phases. Before the jury
returned a verdict on liability, the Appellants orally moved under Rule 50(a) for
judgment as a matter of law, arguing that Rosenberg failed to offer evidence of
malice or ill will that would support a bad faith claim. The district court denied the
motion, and the jury returned a verdict in favor of Rosenberg. Before the jury
completed deliberations on damages, the Appellants filed two Rule 50(a) motions
challenging Rosenberg’s claims for compensatory and punitive damages. The
district court denied the motions, and the jury then returned a verdict on damages,
awarding Rosenberg over $1 million in compensatory damages (for emotional
distress, loss of reputation, and loss of wages) and $5 million in punitive damages.
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The Appellants renewed their motion for judgment as a matter of law, under
Rule 50(b), 28 days after the district court entered judgment. Rosenberg moved to
strike the motion as untimely because it fell outside the time limit provided under
Fed. R. Bankr. P. 9015(c). The district court concluded that the Federal Rules of
Civil Procedure applied, the motion was timely filed, and the motion succeeded on
the merits. Accordingly, the court entered an amended final judgment holding the
Appellants liable for only $360,000 in compensatory damages for emotional
distress. Rosenberg appealed, arguing that the Appellants’ Rule 50(b) motion
should have been denied as untimely. The Appellants cross-appealed, claiming, in
relevant part, that the damages award for emotional distress was improper.
On appeal, we held that the Rule 50(b) motion was untimely because the
Bankruptcy Rules applied to bankruptcy proceedings tried in the district court
under “the plain language of the rules and the weight of authority.” Rosenberg v.
DVI Receivables XIV, LLC, 818 F.3d 1283, 1292 (11th Cir. 2016). We also
rejected the Appellants’ challenge to the emotional distress award because they
challenged the sufficiency of the evidence to support the award in their Rule 50(a)
motion on compensatory damages, but they did not renew the claim in their
post-verdict Rule 50(b) motion. Id. Accordingly, we remanded to the district
court “to reinstate the jury’s award.” Id. at 1293.
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After remand, the Appellants moved for enlargement of time to file the Rule
50(b) motion under Bankruptcy Rule 9006(b)(1), based on excusable neglect.
They also moved the district court to treat their Rule 50(a) motion on punitive
damages as a Rule 50(b) motion. The district court denied the motions based on
our holding in Riney and the mandate rule. This appeal followed.
II.
We review “the district court’s determination of excusable neglect for abuse
of discretion.” Riney, 130 F.3d at 997 (11th Cir. 1997). We review de novo the
application of the law-of-the-case doctrine, Alphamed, Inc. v. B. Braun Med., Inc.,
367 F.3d 1280, 1285 (11th Cir. 2004), which includes the mandate rule, Piambino
v. Bailey, 757 F.2d 1112, 1120 (11th Cir. 1985).
III.
First, the district court did not abuse its discretion in concluding that the
Appellants had not shown excusable neglect to allow for enlargement of time
under Bankruptcy Rule 9006(b)(1). Excusable neglect “is at bottom an equitable”
concept that considers all relevant circumstances surrounding the omission.
Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’ship, 507 U.S. 380, 395
(1993). Courts employ a four-factor test to determine the existence of excusable
neglect: (1) the risk of prejudice to the debtor; (2) the length of the delay and its
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potential impact on judicial proceedings; (3) the reason for the delay, including
whether it was within the reasonable control of the movant; and (4) whether the
movant acted in good faith. Id.; see also Riney, 130 F.3d at 997–98. “[A]ttorney
error based on a misunderstanding of the law [is] an insufficient basis for excusing
a failure to comply with a deadline.” Riney, 130 F.3d at 998.
Here, the Appellants made a legal error when they determined that the filing
deadline for their Rule 50(b) motion was governed by the Federal Rules of Civil
Procedure and not the Bankruptcy Rules. Under Riney, that error is insufficient to
demonstrate excusable neglect. We disagree with the Appellants’ argument that
the district court erred when it failed to explicitly examine each of the Pioneer
factors. In Riney, we held that “as a matter of law . . . an attorney’s
misunderstanding of the plain language of a rule cannot constitute excusable
neglect,” and we explicitly noted that Pioneer did not counsel against that rule. Id.
We are also unpersuaded by the Appellants’ argument that the error in this case is
not a Riney error because the legal mistake in this case was not obvious and
involved an obscure rule. In the prior appeal in this case, we held that the
Bankruptcy Rules applied under “the plain language of the rules.” Rosenberg, 818
F.3d at 1292. Accordingly, the instant error was a “misunderstanding of the plain
language of a rule.” Riney, 130 F.3d at 998.
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We also reject the claim that the district court abused its discretion by failing
to consider that the Federal Rules of Civil Procedure had been used during the
proceedings, and that the district court and Rosenberg appeared to agree that the
deadlines in the Federal Rules applied. The Appellants do not dispute that they did
not review the Bankruptcy Rules before filing the Rule 50(b) motion 28 days after
entry of judgment, and their failure to read the rules weakens the reasonableness of
their reliance on the conduct of the district court and the opposing party. See
Pinion v. Dow Chem., U.S.A., 928 F.2d 1522, 1534 (11th Cir. 1991) (“The
reasonableness of [the appellant’s] reliance on the action of the district court is
severely undercut by the ease with which it could have read [the rule].”).
Finally, we disagree that the Appellants’ mistake is similar to a mistake of
fact. “[W]e have recognized a material distinction between an attorney’s mistake
of law and a mistake of fact,” but those cases involved miscommunications,
ambiguous notices, or clerical errors. United States v. Davenport, 668 F.3d 1316,
1324 (11th Cir. 2012). Here, the Appellants’ failure to read all of the rules and
discern from their plain language that the Bankruptcy Rules applied was a mistake
of law. Thus, the district court’s conclusion that the Appellants’ legal error did not
constitute excusable neglect was not an abuse of discretion.
Nor did the district court err when it ruled that treating the Appellants’ Rule
50(a) motion on punitive damages as a Rule 50(b) motion would violate the
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mandate rule. “The mandate rule is a specific application of the ‘law of the case’
doctrine which provides that subsequent courts are bound by any findings of fact or
conclusions of law made by the court of appeals in a prior appeal of the same
case.” Winn-Dixie Stores, Inc. v. Dolgencorp, LLC, __ F.3d __, 2018 WL
626799, at *5 (11th Cir. Jan. 31, 2018) (quotation marks omitted). “The law of the
case doctrine and the mandate rule ban courts from revisiting matters decided
expressly or by necessary implication . . . .” Id. (quotation marks omitted). It has
its greatest force when a case is on remand to the district court. Id. When a district
court acts under the mandate of an appellate court, the district court “cannot vary
it, or examine it for any other purpose than execution; or give any other or further
relief; or review it, even for apparent error, upon a matter decided on appeal; or
intermeddle with it, further than to settle so much as has been remanded.” Id.
(quotation marks omitted).
In the prior appeal, we ordered “remand for the district court to reinstate the
jury’s award” because the post-verdict motion for judgment as a matter of law was
not timely filed. Rosenberg, 818 F.3d at 1293. The district court could not
recharacterize a prior motion to find that a timely Rule 50(b) motion had been filed
and to invalidate the jury’s award without running afoul of our mandate. See
Winn-Dixie, 2018 WL 626799, at *5.
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The Appellants argue that the mandate rule did not apply because we only
decided the timeliness of their final Rule 50 motion in the prior appeal and did not
determine whether its Rule 50(a) motion challenging punitive damages was a
timely filed Rule 50(b) motion. We are unpersuaded. It is true that the mandate
rule does not apply “when the issue in question was outside the scope of the prior
appeal,” Transamerica Leasing, Inc. v. Inst. of London Underwriters, 430 F.3d
1326, 1332 (11th Cir. 2005), but the mandate rule does apply to matters decided by
necessary implication, Winn-Dixie, 2018 WL 626799, at *5. In the previous
appeal, we rejected the Appellants’ challenge to the compensatory damages award
for emotional distress because they failed to renew their sufficiency argument in
the Rule 50(b) motion. Rosenberg, 818 F.3d at 1292. We recognized that the
Appellants raised their argument in their Rule 50(a) motion on compensatory
damages, and we held that their failure to reiterate the argument in their Rule 50(b)
motion was fatal to their challenge on appeal. Id. Because we decided in the
previous appeal that the pre-verdict motion on compensatory damages was a Rule
50(a) motion, we implicitly decided that the procedurally similar pre-verdict
motion on punitive damages (filed on the same day) was a Rule 50(a) motion, and,
consequently, was not a timely Rule 50(b) motion.
Even if the mandate rule did not apply, reversal would not be warranted.
We may affirm for any reason supported by the record, even if not relied upon by
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the district court. United States v. Chitwood, 676 F.3d 971, 975 (11th Cir. 2012).
The Appellants’ Rule 50(a) motion on punitive damages was filed, and denied,
before the verdict on damages. Rule 50(b) contemplates a motion after a verdict.
Fed. R. Civ. P. 50(b) (“Renewing the Motion After Trial”). The Appellants have
provided no precedent of this Circuit holding that a pre-verdict Rule 50 motion can
be construed as a Rule 50(b) motion. The Appellants argue that the motion on
punitive damages was filed in accordance with Rule 50(b) because it was filed
after the liability verdict. But the motion on punitive damages sought “dismiss[al]
[of] Plaintiff’s punitive damages claim,” and the jury had not yet reached a verdict
on that claim when the motion was filed. Thus, the motion cannot now be
recharacterized as a motion filed after the award of punitive damages.
Accordingly, we affirm the district court’s order denying extension of time
to file a Rule 50(b) motion and recharacterization of the Appellants’ Rule 50(a)
motion on punitive damages.
AFFIRMED.
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