# U. S. Securities & E v. Thornton

> District Court, S.D. Florida · April 20, 2020

URL: https://www.frixlaw.com/law-library/cases/10117583

## Case

- **Court:** District Court, S.D. Florida
- **Decided:** April 20, 2020
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

United Statfeosr tDhies trict Court
Southern District of Florida

Securities and Exchange )
Commission, Plaintiff, )
)
v. ) Civil Action No. 86-06832-Civ-Scola
)
Grant Thornton and others, )
Defendants. )
Order Granting the Defendant’s Unopposed Motion for Relief from Consent
Undertakings and Partial Relief from Judgment
This matter is before the Court upon Defendant Grant Thornton LLP’s
unopposed motion for relief from consent undertakings and partial relief from
judgment pursuant to Rule 60(b)(5) of the Federal Rules of Civil Procedure. (ECF
No. 14.) Upon review of the motion, the record, and the relevant legal authorities,
the Court grants the motion. (ECF No. 14.)
Rule 60(b)(5) authorizes courts to “relieve a party or its legal representative
from a final judgment, order or proceeding” where its application “prospectively is
no longer equitable.” Fed. R. Civ. P. 60(b)(5). Undertakings, or promises to
perform certain acts in the future, are “prospective” in their application, and thus
properly within the limits of the equitable subsection of Rule 60(b)(5). Cf. Flexiteek
Americas, Inc. v. PlasTEAK, Inc., 08-60996-CIV, 2012 WL 5364263, at *6 (S.D.
Fla. Sept. 10, 2012) (Seltzer, Mag. C.J.), report and recommendation adopted as
modified, 08-60996-CIV, 2012 WL 5364247 (S.D. Fla. Oct. 31, 2012) (Cohn, J.).
The Rule “encompasses the traditional power of a court of equity to modify its
decree in light of changed circumstances.” Frew ex rel. Frew v. Hawkins, 540 U.S.
431, 441 (2004); see also Hodge v. Dep’t of Housing and Urban Dev., 862 F.2d
859, 861-62 (11th Cir. 1989) (Congress has codified in Rule 60(b)(5) the judicial
formulation of a court’s inherent power to modify an injunction in adaptation to
changed conditions). Consent decrees in particular have “long been recognized as
subject to potential modification by the court in the future.” Griffin v. Sec’y,
Florida Dept. of Corr., 787 F.3d 1086, 1090-91 (11th Cir. 2015).
At issue are the Consent Undertakings dated October 15, 1986 and the
Final Judgment dated October 16, 1986, which, the Defendant contends, “impose
superfluous and unduly burdensome undertakings” on the Defendant following
its nearly 35 years of compliance. (ECF No. 14 at 1.) As the motion explains, these
undertakings have generally been rendered outdated by changes in both law and
facts. As to legal changes, the Sarbanes-Oxley Act of 2002 created the Public
Company Accounting Oversight Board, which has replaced the SEC’s partner
rotation policies that existed in 1986. (Id. at 4.) Other portions of the Consent
Undertaking also apply to employment positions that “no longer exist[] at Grant
Thornton” and, as the motion avers, were replaced by more comprehensive
technical review positions. (ECF No. 14 at n.9-10.) Additionally, new professional
standards that apply to the Defendant address portions of the Consent
Undertaking that have governed Grant Thornton. (/d. at 6.) Finally, the Court
takes into account that the Securities and Exchange Commission has chosen not
to oppose the motion. (See Exhibit 5, ECF No. 14-5 (April 20, 2020 e-mail from
SEC Special Trial Counsel Timothy N. McGarey (“After due consideration, the
Commission will not oppose a Rule 60(b)(5) motion filed by Grant Thornton
seeking to vacate the Undertakings contained in the ESM Consent Order.”).)
Accordingly, the Court grants the motion (ECF No. 14) and the Consent
and Undertakings of Grant Thornton LLP, dated October 15, 1986 are hereby
terminated. Parts II, IV and V of the Final Judgment of Permanent Injunction
and Other Equitable Relief as to Grant Thornton, dated October 16, 1986, are
hereby terminated to the extent they relate to and/or incorporate the Consent
Undertakings.
Done and ordered at Miami, Florida, on April 20, 2020.
N. Scola, Jr.
United States District Judge

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10117583. Public record. Not legal advice.