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Holland v. MGA, Inc.

United States District Court, M.D. Alabama, Southern Division

January 3, 2018

BARBARA HOLLAND, d/b/a CHOICE VIDEO, Plaintiff,
v.
MGA, INC., and all holding companies and affiliated entities doing business as MOVIE GALLERY, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          W. KEITH WATKINS CHIEF UNITED STATES DISTRICT JUDGE

         Before the court is Barbara Holland's motion for relief from judgment. (Doc. # 117). No Defendant opposes Barbara Holland's request for relief from judgment. On December 13, 2017, the court held oral argument on the motion. Present at oral argument were counsel for Defendant LFP, counsel for Barbara Holland, and Barbara Holland. Malcolm Rance Newman[1] was not present.

         On March 14, 2005, Malcolm Rance Newman filed this action on behalf of Barbara Holland d/b/a Choice Video. (Doc. # 1.) At the time he filed the lawsuit, there was no business entity known as “Barbara Holland d/b/a Choice Video.”[2]Malcolm Rance Newman never met or spoke with Barbara Holland. Barbara Holland had no or limited dealings with the Defendants, and she had no motive or desire to sue any of them. Until Barbara Holland received Defendant LFP, Inc.'s motion to revive the judgment in May 2017, she was unaware of the existence of this case, the filing of the frivolous appeal, the judgment awarding attorney's fees and costs for the pursuit of the frivolous appeal, and the liens Defendants had filed against her personal and business property in an attempt to execute on that judgment.[3] Therefore, based on the clear, uncontradicted evidence and an independent review of the record, the court finds that Malcolm Rance Newman was never authorized to file the complaint or to represent Barbara Holland or any entity known as Choice Video.

         Based on the clear, undisputed evidence, the court finds that Malcolm Rance Newman acted in bad faith and perpetrated a fraud on the court when he filed this case in the name of a person who was not his client.[4] Barbara Holland bore no personal responsibility for the frivolous appeal and, but for Malcolm Rance Newman's fraudulent representation that Barbara Holland d/b/a Choice video was his client, Barbara Holland would never have been held liable for attorney's fees for that appeal. Solely because of Malcolm Rance Newman's fraud on the court, judgment was erroneously entered against Barbara Holland for attorney's fees Defendants incurred in contesting the frivolous appeal that Malcolm Rance Newman filed without Barbara Holland's knowledge or participation. Thus, the judgment against Barbara Holland is the product of Malcom Rance Newman's fraud on this court (and on the Eleventh Circuit Court of Appeals).[5] Moreover, because Barbara Holland was never a party to this case and did not appear in the case prior to entry of the judgment, the judgment is void as to her.

         Therefore, the court finds (1) that Barbara Holland is entitled to relief from the judgment awarding attorneys' fees and costs for that appeal; (2) that the judgment is void as to Barbara Holland because she was never a party to this lawsuit; and (3) in any event, as to Barbara Holland the judgment is due to be vacated on grounds that it is solely the product of Malcolm Rance Newman's fraud on this court and that this lawsuit was a fraud. See Fed. R. Civ. P. 60(b)(4), (6) (“On motion and just terms, the court may relieve a party or its legal representative from a final judgment, order, or proceeding” on grounds that “the judgment is void” or for “any other reason that justifies relief” not listed in Rule 60(b)(1)-(5)); Fed.R.Civ.P. 60(d)(3) (providing that a court may “set aside a judgment for fraud on the court”); Chambers v. NASCO, Inc., 501 U.S. 32, 44 (1991) (noting the court's “inherent power . . . to vacate its own judgment upon proof that a fraud has been perpetrated upon the court”).[6] Cf. Ala. Code § 34-3-22 (“If it is alleged by a party for whom an attorney appears that he or she does so without authority, the court may at any stage of the proceedings, upon proof of the allegation, relieve the party for whom the attorney has assumed to appear from the consequences of his or her acts.”).

         Accordingly, and for the reasons stated at oral argument, it is ORDERED as follows:

         1. Barbara Holland's motion for relief from judgment (Doc. # 117) is GRANTED.

         2. The June 5, 2007 Order (Doc. # 109) is VACATED IN PART on grounds that it is VOID IN PART. Specifically, the June 5, 2007 Order (Doc. # 109) is vacated as void to the extent that the Order enters judgment against Barbara Holland and/or “Barbara Holland d/b/a Choice Video” and in favor of LFP, Inc., in the amount of $1, 917.03, in favor of Movie Gallery US, LLC, in the amount of $5, 614.00, and in favor of Mile High Media, Inc., in the amount of $2, 337.00. This Order relieves Barbara Holland and “Barbara Holland d/b/a Choice Video” from any and all liability to any Defendant for the judgment in this case.

         3. The June 5, 2007 judgment (Doc. # 109) remains valid and shall continue in force solely against Malcolm Rance Newman (“Malcolm R. Newman, Esq.”). Malcolm Rance Newman (“Malcom R. Newman, Esq.”) shall continue to remain liable for the June 5, 2007 judgment (Doc. # 109) against him and in favor of LFP, Inc., in the amount of $1, 917.03, in favor of Movie Gallery US, LLC, in the amount of $5, 614.00, and in favor of Mile High Media, Inc., in the amount of $2, 337.00.

         4. As to Barbara Holland and/or “Barbara Holland d/b/a Choice Video, ” Defendants shall make no further attempts to execute on the judgment.[7] Defendants shall provide any reasonable cooperation necessary to relieve Barbara Holland and/or “Barbara Holland d/b/a Choice Video” of any and all liens Defendants previously filed in attempt to execute on the judgment in this case.

         If Barbara Holland or any Defendant reasonably incurs attorney's fees or costs in conjunction with state court proceedings to remove liens or otherwise relieve Barbara Holland and/or “Barbara Holland d/b/a Choice Video” of liability for the judgment, they may, if they wish, move this court for an order requiring Malcolm Rance Newman to reimburse the attorney's fees and costs incurred in those state court proceedings.[8] Reasonable attempts shall be made to serve any such motion on Malcolm Rance Newman, along with a copy of this Order. The movants shall file written notice with the court if they are unable, with reasonable effort, to serve Malcolm Rance Newman. If Defendants or Barbara Holland are unable, with reasonable diligence, to serve Malcolm Rance Newman with their motions for attorney's fees and costs and a copy of this Order, or if Malcolm Rance Newman does not file a response on or before 14 days after being served with such a motion and a copy of this Order, then he will be deemed to have waived his right to contest the imposition and amount of the award for attorney's fees and costs incurred in state court.

         5. Barbara Holland may request the Clerk of the Court to issue an Amended Certificate of Judgment reflecting that the June 5, 2007 judgment (Doc. # 109) (1) has been vacated in part and is void as to Barbara Holland and/or “Barbara Holland d/b/a Choice Video;” (2) that neither Barbara Holland nor “Barbara Holland d/b/a Choice Video” is liable to any Defendant, including Defendants LFP, Inc., Movie Gallery US, LLC, Mile High Media, Inc., for any amount with respect to the judgment in this case; and (3) that the June 5, 2007 judgment continues and remains valid solely against Malcolm Rance Newman (“Malcolm R. Newman, Esq.”) and in favor of LFP, Inc., in the amount of $1, 917.03, in favor of Movie Gallery US, LLC, in the amount of $5, 614.00, and in favor of Mile High Media, Inc., in the amount of $2, 337.00.

         6. The Clerk of the Court is DIRECTED to serve a copy of this order on the following persons at the following addresses by ...


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