Raven v. Oppenheimer & Co., Inc.

PUBLISH

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

________________________

No. 94-9157
________________________
D.C. Docket No. 1:89-CV-2046-RCF

JONATHAN RAVEN, ELI SHAPIRO,

Plaintiffs-Appellees,

versus

OPPENHEIMER & CO., INC., WENDY'S INTERNATIONAL, INC.,
J. MICHAEL BODNAR, R. WAYNE LEWIS, HOWARD E. SACHS,
PROFESSIONAL RESTAURANT SERVICES, INC.,

Defendants-Appellants.

________________________

Appeal from the United States District Court
for the Northern District of Georgia
________________________
(January 22, 1996)

Before EDMONDSON and BIRCH, Circuit Judges, and HENDERSON, Senior
Circuit Judge.

PER CURIAM:

The present appeal arises from an order of the United States

District Court for the Northern District of Georgia reinstating

this securities fraud action pursuant to § 27A(b) of the

Securities Exchange Act of 1934, 15 U.S.C. § 78aa-1, and
Fed.R.Civ.P. 60(b)(6), after the action was dismissed as time-

barred in accordance with Lampf, Pleva, Lipkind, Prupis &
Petigrow v. Gilbertson, 501 U.S. 350, 111 S.Ct. 2773, 115 L.Ed.2d

321 (1991) ("Lampf"), and James B. Beam Distilling Co. v.

Georgia, 501 U.S. 529, 111 S.Ct. 2439, 115 L.Ed.2d 481 (1991)

("Beam"). We reverse.

I. BACKGROUND

The plaintiffs, holders of securities offered by the Wendco

Northwest Limited Partnership, filed this lawsuit on May 26, 1989

in the United States District Court for the Northern District of

Illinois. The complaint alleged violations of Section 10(b) of

the Securities Exchange Act of 1934, 15 U.S.C. §78j(b), Rule 10b-

5 of the Securities and Exchange Commission, 17 C.F.R. § 240.10b-

5, the Racketeer Influenced and Corrupt Organizations Act, 18

U.S.C. § 1961 et seq. ("RICO"), and state common law. On August

18, 1989, the case was transferred to the United States District

Court for the Northern District of Georgia as authorized by 28

U.S.C. § 1404(a). Thereafter, on June 20, 1991, the United

States Supreme Court rendered its decisions in Lampf and Beam.

In Lampf, the Court rejected the practice of utilizing state
statutes of limitation for private causes of action arising under

§ 10(b) and Rule 10b-5 and announced a uniform federal time frame

requiring the commencement of such actions within one year after

the discovery of the violation and no later than three years from

the date of the alleged violation. Lampf, 501 U.S. at 361-62,

111 S.Ct. at 2781-82, 115 L.Ed.2d at 335-36. In Beam, the Court

2
held that when a new rule of federal law is implemented in the

case announcing the rule, it must be extended retroactively to

all pending cases. Beam, 501 U.S. at 541-44, 111 S.Ct. at 2446-
48, 115 L.Ed.2d at 492-93. Because the limitation period

required by Lampf was applied to the litigants in that case, this

court recognized, in Lufkin v. McCallum, 956 F.2d 1104, 1108

(11th Cir.), U.S. , 113 S.Ct. 326, 121 L.Ed.2d 246 (1992),

that it must be enforced with respect to similarly situated

parties. See Henderson v. Scientific-Atlanta, Inc., 971 F.2d

1567, 1569 (11th Cir. 1992), cert. denied, U.S. , 114

S.Ct. 95, 126 L.Ed.2d 62 (1993).

After Lampf and Beam were decided, the district court held

that the plaintiffs' § 10(b) and Rule 10b-5 claims were time-

barred and that the complaint failed to state a claim on the RICO

cause of action. Because no federal claims remained, the court

declined to exercise pendent or supplemental jurisdiction over

the state law counts. See 28 U.S.C. § 1367(c)(3). A judgment

dismissing the federal causes with prejudice and the state law

claims without prejudice was entered on October 16, 1991. The

plaintiffs did not appeal and, therefore, the judgment became

final thirty days later. See 28 U.S.C. § 2107(a).
On December 19, 1991, Congress amended the Securities

Exchange Act of 1934 by enacting § 27A. It provides:

Sec. 27A. (a) Effect on Pending Causes
of Action.--The limitation period for any
private civil action implied under section
10(b) of this Act that was commenced on or
before June 19, 1991, shall be the limitation
period provided by the laws applicable in the

3
 jurisdiction, including principles of
retroactivity, as such laws existed on June
19, 1991.

(b) Effect on Dismissed Causes of
Action.--Any private civil action implied
under section 10(b) of this Act that was
commenced on or before June 19, 1991--
(1) which was dismissed as time
barred subsequent to June 19, 1991, and
(2) which would have been timely
filed under the limitation period provided
by the laws applicable in the
jurisdiction, including principles of
retroactivity, as such laws existed on June
19, 1991,
shall be reinstated on motion by the
plaintiff not later than 60 days after the
date of enactment of this section.

Pub.L. No. 102-242, § 476, 105 Stat. 2236, 2387 (1991) (codified

at 15 U.S.C. § 78aa-1).

On February 14, 1992, the plaintiffs filed a motion to

reinstate their claims under § 10(b) and Rule 10b-5 in accordance

with § 27A(b). The defendants opposed the revival of the lawsuit

on the ground that the statute was unconstitutional. The

district court certified the constitutional question to the

United States Attorney General in accordance with 28 U.S.C.

§ 2403(a),1 and directed the parties to submit additional

argument on point. In subsequent briefing, the plaintiffs

asserted that, even if § 27A(b) was unconstitutional, the prior

judgment dismissing the § 10(b) and Rule 10b-5 claims could be

1
Section 2403(a) directs that, in actions attacking the
constitutionality of an Act of Congress affecting the public
interest, "the court shall certify such fact to the Attorney
General, and shall permit the United States to intervene for
presentation of evidence, if evidence is otherwise admissible in
the case, and for argument on the question of constitutionality."

4
set aside under the authority of § 27A(a) and Fed.R.Civ.P.

60(b)(6).2 After considering the contentions of the parties and

the views of the United States, on September 24, 1992, the

district court held that § 27A was constitutional in its entirety

and granted the plaintiffs' motion to reinstate their claims

pursuant to that statute. The court also stated in a footnote

that it found "merit in plaintiff's [sic] request to reinstate

the action under Fed.R.Civ.P. 60(b)" and therefore "grant[ed]

that motion independently." (R6-100 at 25 n.9).

On September 1, 1994, the district court amended its order

dated September 24, 1992 to declare that it warranted

interlocutory appellate review and stayed the proceedings until

further order. This court subsequently granted permission to

appeal. See 28 U.S.C. § 1292(b) (allowing appeals to be taken in

civil cases from decisions not otherwise appealable when the

district court states in writing that the "order involves a

controlling question of law as to which there is substantial

ground for difference of opinion and that an immediate appeal

from the order may materially advance the ultimate termination of

the litigation").

II. DISCUSSION

In the first round of briefs filed on appeal the parties

reiterated the arguments they had asserted in the district court.

2
Rule 60(b) permits a court to relieve a party from a final
judgment for certain specified reasons such as mistake, newly
discovered evidence or fraud. Subsection (b)(6) is a catch-all
provision which empowers a court to do so for "any . . . reason
justifying relief" not otherwise enumerated.

5
The defendants urged us to reverse the district court's order on

the grounds that § 27A(b) contravenes the separation of powers

doctrine and the due process clause. The plaintiffs defended the

constitutionality of the statute and responded that, in any

event, the district court could revive the action relying on

Fed.R.Civ.P. 60(b)(6) as its authority. Shortly thereafter,

however, the Supreme Court decided Plaut v. Spendthrift Farm,

Inc., 514 U.S. , 115 S.Ct. 1447, 131 L.Ed.2d 328 (1995). In

Plaut, a majority of the Court held that § 27A(b) runs afoul of

the separation of powers doctrine and "is unconstitutional to the

extent that it requires federal courts to reopen final judgments

entered before its enactment."3 Id. at , 115 S.Ct. at 1463,

131 L.Ed.2d at 356. In a supplemental brief filed with this

court the plaintiffs now concede, as they must, that the district

court was without authority to give new life to the § 10(b) and

Rule 10b-5 claims under § 27A(b) because that subsection of the

statute is unconstitutional. They continue to maintain, however,

that reinstatement was permissible under Fed.R.Civ.P. 60(b)(6).4

3
The Court in Plaut declined to decide whether § 27A(b) also
offends the due process clause because the case could be decided
on the narrower separation of powers issue. Plaut, 514 U.S. at
, 115 S.Ct. at 1452, 131 L.Ed.2d at 341-42.
4
We note that although the district court's order declaring
the propriety of interlocutory appeal did not specifically
mention the need for an appellate decision on the Rule 60(b)(6)
question, the scope of interlocutory appellate review under 28
U.S.C. § 1292(b) "is not limited to the precise question
certified by the district court because the district court's
order, not the certified question, is brought before the court."
Aldridge v. Lily-Tulip, Inc. Salary Retirement Plan Benefits
Comm., 40 F.3d 1202, 1207 (11th Cir. 1994), cert. denied, 64
U.S.L.W. 3395 (U.S. Dec. 4, 1995) (No. 95-526). We find that the

6
 Rule 60(b)(6) provides an "extraordinary remedy" by which a

district court may, in its discretion, relieve a party from a

final judgment in order to do justice. Ritter v. Smith, 811 F.2d
1398, 1400 (11th Cir.), cert. denied, 483 U.S. 1010, 107 S.Ct.

3242, 97 L.Ed.2d 747 (1987). The district court did not explain

the basis upon which it found merit in the plaintiffs' Rule

60(b)(6) motion. The plaintiffs' brief filed in support of the

motion, as well as their briefs submitted on appeal, make it

clear, however, that the request was premised on an argument that

§ 27A(a), which was held constitutional by this court in

Henderson, 971 F.2d at 1575,5 established a new statute of

limitations for all § 10(b) actions filed on or before June 19,

1991,6 and that Rule 60(b)(6) relief may be founded upon such a

change in the law. We presume, therefore, that the district

court employed this reasoning in granting the motion. The

defendants contend this was error because § 27A(a) has no

application to the facts of this case.

resolution of this issue will "materially advance the ultimate
termination of the litigation" and, thus, exercise our discretion
in favor of reaching this question as well. 28 U.S.C. § 1292(b).

5
In Henderson, the court found that Congress possessed the
constitutional authority to dictate the method for determining
the statute of limitations in a pending § 10(b) lawsuit. The
Supreme Court's decision in Plaut construing § 27A(b), which
addressed the revival of cases finally adjudicated, does not
affect the validity of the holding in Henderson.
6
A better characterization of the effect of § 27A(a) is that
it restored, in § 10(b) cases filed on or before June 19, 1991,
the old method of calculating the statute of limitations
overruled by Lampf.

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 We agree that the revival of this action does not fall

within the purview of § 27A(a). We begin our analysis by

observing that, in construing the effect of a statute, we must

look to its language and design as a whole. United States v.

Chandler, 996 F.2d 1073, 1084 (11th Cir. 1993), cert. denied,

U.S. , 114 S.Ct. 2724, 129 L.Ed.2d 848 (1994). The text of

§27A(a) states that it applies to "any" § 10(b) action commenced

on or before June 19, 1991. The word "any" is capable of more

than one meaning, depending on the context in which it is used.7

When viewed in the context of § 27A as a whole, it becomes

evident that the term "any" in subsection (a) does not include

lawsuits that were dismissed as time-barred after June 19, 1991,

which are governed by subsection (b).

The heading of subsection (a), which refers to "Pending

Causes of Action," is further evidence that Congress did not

intend for it to apply to all § 10(b) actions filed on or before

June 19, 1991, as urged by the plaintiffs. Although section

headings may not be used to limit the plain meaning of the text

of a statute, they may be employed as tools of interpretation

when the text is ambiguous. United States v. Castro, 837 F.2d

441, 442 n.1 (11th Cir. 1988).8 As we have stated, the word

7
"Any" may refer to "one, a, an, or some," or "one or more
without specification or identification." The Random House
College Dictionary 61 (1st ed. 1980).
8
This is so only when the heading is part of the act as
written and passed by Congress and not added by those responsible
for codification. Castro, 837 F.2d at 442 n.1. The heading of
subsection (a) was included in Congress's enactment of § 27A.
See 105 Stat. at 2387.

8
"any" is unclear unless put into context. We find that the

phrase "any private civil action" in subsection (a), when

considered in conjunction with the subsection's heading and with

subsection (b), was designed to encompass only those § 10(b)

complaints which were pending on December 19, 1991. Without

belaboring the meaning of the term "pending," see Georgia Ass'n

of Retarded Citizens v. McDaniel, 855 F.2d 805, 809 (11th Cir.

1988) (recognizing that the word "pending" is open to varying

interpretations depending on the circumstances), cert. denied,

490 U.S. 1090, 109 S.Ct. 2431, 104 L.Ed.2d 988 (1989), it cannot

be said that the present action was pending on December 19, 1991.

We accordingly hold that the district court abused its discretion

by granting Rule 60(b)(6) relief founded upon an application of

§ 27A(a).9

III. CONCLUSION

In keeping with the foregoing analysis, the district court's

order reinstating the plaintiffs' § 10(b) and Rule 10b-5 claims

is VACATED.

9
The defendants also argue that a congressional, as opposed
to a judicial, change in the law may never be used to set aside a
final judgment under Rule 60(b)(6). Cf. Ritter, 811 F.2d at 1401
(a judicial reconstruction of what the law is may provide the
"truly extraordinary circumstances necessary" to support Rule
60(b)(6) relief). That Congress may not mandate the reopening of
a final judgment is obvious in light of Plaut. Whether the
separation of powers problem may somehow be avoided by seeking
Rule 60(b)(6) discretionary relief premised upon a new
congressional pronouncement seems doubtful. We need not decide
this thorny issue, however, given our conclusion that § 27A(a),
upon which the plaintiffs sought Rule 60(b)(6) relief, governs
only those cases still pending on December 19, 1991.

9