Opposition Brief — United States ex rel. Paul v. Parsons, Brinkerhoff, Quade & Douglas, Inc.

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SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1996

UNITED STATES ex rel. PAUL,

Petitioner,

Vv.

PARSONS, BRINKERHOFTF,

QUADE & DOUGLAS, INC. et al.,

Respondents.

ON PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

BRIEF IN OPPOSITION FOR RESPONDENT

BATTELLE MEMORIAL INSTITUTE,

PROJECT MANAGEMENT DIVISION

Frederick Robinson*

FULBRIGHT & JAWORKSI, L.L.P.

801 P. vania Avenue, N.W.

QUESTION PRESENTED

I. Whether the district court abused its

discretion in denying the Petitioner’s motion, pursuant

to Rule 60(b) of the Federal Rules of Civil Procedure,

for relief from that court’s earlier order dismissing

Petitioner’s False Claims Act ("FCA") complaint,

brought pursuant to 31 U.S.C. § 3730(b) (1994), on the

basis that Petitioner’s action was barred by res

judicata, where Petitioner failed to satisfy the

requirements of Rule 60(b), warranting relief from the

dismissal of this action.

a ae a

TABLE OF CONTENTS

REESE Pr au a 1

PIAA HISTORY ................, 2

BATION FACTS ... 0.66... eae 6

A. ipmereet History .............. 6

B. Litigation History ............. 7

SUMMARY OF ARGUMENT .............. 9

I A kk cca ce. 10

I. The District Court Correctly

Denied Paul’s Motion to Dismiss

Under Rule 60(b) of the Federal

Rules of Civil Procedure ........ 10

A. Standard of Review ....... 10

B. Jurisdiction Of The State

Pe 4 & oan 11

1. The Alleged Absence

Of Indispensable

Parties In The State

Court Case Does Not

Impact The Validity

Of The Texas

ea 12

2. Paul Has Abandoned

His Contention That

i

The State Court

Lacked Jurisdiction

Over Contracts

Negotiated In Other

States By Failing To

Brief It On Appeal

To The Fifth Circuit . 15

3. Paul’s Argument

That The State Court

Did Not Have

Jurisdiction Over

Claims That Arose In

Other Jurisdictions

Does Not Impact The

Validity Of That

Judgment ......... 16

C. Paul Improperly Raises The

District Court’s Underlying

Decision Which Is Not

Reviewable In The Instant

RO ee RRR 17

D. The District Court Did Not

Abuse Its Discretion In

Denying Paul’s Rule

60(b)(3) Motion, Because,

Even Assuming That Paul

Could Establish That The

Defense Of His State Case

Was Predicated Upon

Factually False Evidence,

Paul Has Failed To

Demonstrate that He Was

Prevented From Fully And

Fairly Presenting His State

et Beiter ae 18

CONCLUSION

TABLE OF AUTHORITIES

CASES

Al-Ra’Id v. Ingle, 69 F.3d 28 (5th Cir. 1995) .... 16

Brinkman v. Dallas Co eputy Sheriff Abner,

813 F.2d 744 (5th Cir. 1987))........... 15

_ Browder v. Director Ill. Dept. of ections,

434 U2. Bor Chee a os kc e Gen eed: 11

Fidelity Standard Life Ins. Co. v. First Nat’] Bank &

Trust Co., 382 F. Supp. 956 (S.D. Ga. 1974)

aff'd, 510 F.2d 272 (5th Cir.), cert. denied,

423 423 US. Oe Cie kas Vi es 0 eon 19, 20

Gilbert v. Franklin County Wa .

520 S.W.2d 527, 533 (Tex. Civ. App.

-- Texarkana 1975, no writ) ........ 19, 20

Gulf Coast Bldg. Co. v. tio

Brotherhood ectrical Workers,

460 F.2d 105 (5th Cir. 1972) ........ 17-18

Midessa_ Television Co. v. Motion Pictures for

Television, Inc., 290 F.2d 203 (5th Cir.),

cert. denied, 368 U.S. 827 (1961) ........ 19

Paul v. P.B.-K.B.B., Inc.,

3 Mies See Clee) 6 bs FAA ee ee 8

Paul v. Federal e § d_ He iew

Comm’n, 812 F.2d 717 (D.C. Cir.), earl, denied,

483 U.S. 1088 (iG6T): os wee

iv

Paul v. P.B.-K.B. =

801 S.W.2d 229 (Tex. App. -- Houston [14th

Dist.] 1990, writ denied) ....... 8, 9, 13, 20

ey v c

504 S.W.2d 527 (Tex. Civ. App. -- Texarkana

SR agg er a ge a a 19

Schutten v. She

421 F.2d 869 (5th Cir. | Ee ae 14

Slangal v. Getzin,

148 F.R.D. 691 (D. Neb. 1993) .......... 19

38 F.3d 1404 (5th Cir. 1994) ........... 11

Quade & Douglas, Inc., Civil Salta enthan H-

92-2429 (S.D. Tex. August 9, 1995), aff’d

without op., 85 F.3d 624 (5th Cir. April 26,

Rog AEs OE OR A ea 1, 4, 5, 9

860 F Supp. 310 (SD.

Tex. 1994), affd without oD, 58 F.3d

1282 (5th Cir. 1995), cert. denied,

LUG SD. OAl LOO. hones a co xoes 3, 5, 9, 17

United e . v. ty)

. 0d F.3d 1282 (5th Cir.

1995) (unpublished opinion) ...... 3, 5, 9, 17

85 F.3d ete Cir.

1996) (unpublished opinion) Re eee eae 5

United States, ex rel. Paul v. Parsons, Brinkerhoff,

Quade & Douglas, Inc.,

LID BAgk Bar See 6s a Peas 5

United Vv i

Quade & Douglas, Inc., No. 95-20733, slip op.

(5th Cir. April 26, 1996) ..... 5-6, 15, 17, 21

Vandervoort, Sams, Anderson, Alper & Post, P.A. v.

Vandervoort, 529 F.2d 424, 426 (5th Cir.

MEP is. SS CERES REESE OR RR 19

Washi _

916 F.2d 1036, 1038 (5th Cir. 1990) ...... 12

Wilson v

638 F. 2d 801, 803 (5th Cir. Unit B Mar.

BOGE? 6c ees Mote 1 Ok Coy pees 10

URES OM. . 5 ee ss 1

30 U.S.C. § 801 et seq, (1994) ...........0005. 8

20 RED OMAN 5 5 x Ee ages ee ek ass .

31 U.S.C. § 3730(b)(4) (1982), amended by

31 U.S.C. § 2720(e)(4) (1994) ............ 1

$1 USO. CUE. 2

SL UBC. § SIMRO Te bc ke ccc ccc ines 2

BE Wn PD CED boc o cbse cectasins 1

Tex. Gov’t Code Ann. § 24.007

Bo ES eo ee eee ee 13

RULES

Fed. K. Civ. P. GOD) .......... 3, 4, 5, 9, 10, 11

cewek PRT TE 60 wee ale Oe os 12, 13, 15, 16, 17

PCL Es BEE fb wns Kirk bee wee coe eee 14

EE eS raw Nes ween sae kee oo 6

ey i re tan are ea ee 1

SIRS 0065 FOE 6 PNG oh Sele ee 2

OE ee ain bo ik ae we HE OE BHM 1A es PO 14

TEXTBOOKS & OTHER

21 Federal Procedure, L. Ed. § 51:188 (1984) .... 19

Restatement (Second) of Judgments § 12 (1982) . 13

Restatement (Second) of Judgments § 70,

CI Tie sok £8 NES es 20

DICTIO

A final decision was issued by the United States

District Court for the Southern District of Texas on

August 9, 1995 and that decision was affirmed by the

United States Court of Appeals for the Fifth Circuit on

April 26, 1996. United States ex rel. Paul v. Parsons,

i Oo c., Civil Action

Number H-92-2429 (S.D. Tex. August 9, 1995), aff'd

without op., 85 F.3d 624 (5th Cir. 1996). Petitioner

filed the instant Petition for Writ of Certiorari ("Pet.")

within ninety days of that denial. Accordingly, the

Petition was timely filed under Rule 13.1 of the

Supreme Court Rules. See 28 U.S.C. § 1254.

Although this Court has jurisdiction to review

this case under Rule 13.1 and 28 U.S.C. § 1254,

Respondent Battelle Memorial Institute ("BMI")

continues to assert -- as it did before the district court

and the Fifth Circuit -- that the federal courts lack

subject matter jurisdiction over this case. Briefly,

under the FCA, the federal courts lack jurisdiction over

any cause of action arising prior to 1986 if the "action

is based on evidence or information the Government

had when the action was brought." 31 U.S.C.

§ 3730(b)(4) (1982), amended by 31 U.S.C, § 3730(e)(4)

(1994). For claims arising after 1986, the courts have

no jurisdiction over actions based upon publicly

disclosed allegations or transactions unless the relator

is the "original source" of that information. 31 U.S.C.

§ 3730(e)(4) (1994). As BMI asserted before the lower

courts, Petitioner’s FCA suit contains no information

that the Government did not have when the action was

brought, all of Petitioner’s allegations had been

publicly disclosed when the action was brought and

Petitioner is not an "original source." Consequently,

there is no federal court subject matter jurisdiction

over this action.

PROCEDURAL HISTORY

BMI is a non-profit charitable trust organized as

a non-profit corporation under the laws of the State of

Ohio.” Its primary activity is the performance of

research, development, management, and technical

services on a contract basis for industrial, federal,

state, and local governmental clients. Petitioner Paul

is an engineer who, in 1982, worked for Respondent

PB-KBB, one of two companies constituting a joint

venture that was a subcontractor to BMI. The joint

venturers were Respondents PBQD, a New York

corporation, and PB-KBB, a Delaware corporation.

On August 10, 1992, Paul filed a complaint in

the United States District Court for the Southern

District of Texas under the qui tam provisions of the

FCA, 31 U.S.C. § 3730(b) (1994), against PB-KBB and

PBQD. On September 11, 1992, Paul filed a qui tam

complaint against BMI containing virtually identical

allegations. On April 1, 1993, pursuant to 31 U.S.C.

§ 3730(b)(4)(B), the United States filed a Notice of

Election Not to Intervene in this action. On July 14,

1993, the district court ordered the consolidation of

od In addition to BMI, a listing of the parties in the lower

court proceedings, as required by Rule 14.1(b) of the Supreme

Court Rules, includes: (Di Petitioner Dilip Kumar Paul ("Paul"); (2)

Respondent P.B.-K.B.B., Inc. ("PB-KBB"); and (3) Respondent

Parsons, Brinkerhoff, Quade & Douglas, Inc. (“PBQD"). Pursuant

to Rule 29.1 of the Supreme Court Rules, BMI states that it has

no parent companies, however, it has two non-wholly owned

subsidiaries: (1) Geosafe Corporation; and (2) Research Insurance

Company Limited. Both of these subsidiaries are approximately

99% owned by BMI.

2

Paul’s complaint against PBQD and PB-KBB with the

action against BMI. The district court am a

granted BMI’s motion to dismiss. United States ex rel.

Paul v. Parsons, Brinkerhoff, Quade & Douglas, Inc.,

860 F. Supp. 310, 372 (S.D. Tex. 1994).

On August 30, 1994, Paul filed a notice of appeal

to the United States Court of Appeals for the Fifth

Circuit. On April 28, 1995, the Fifth Circuit affirmed

1282 (6th Cir. 1995) ienoebtiied sls Loe

Thereafter, Paul filed a motion under Rule 60(b)

of the Federal Rules of Civil Procedure, in the district

court, on July 17, 1995, seeking relief from the Court’s

earlier order dismissing Paul’s qui tam suit on me

basis that Paul’s action was barred by res judicata

Primarily, Paul argued that, based upon purported

newly discovered evidence, the prior state-court

judgment was void, and, thus, could not be the basis

for the district court’s finding of res judicata. Among

numerous contentions, Paul asserted that the prior

state-court judgment was not a "final judgment on the

merits" because: (1) the Texas state court lacked

subject matter jurisdiction and in personam jurisdiction

over certain purportedly "indispensable parties" (even

though Paul was the party that filed that action in

Texas and failed to join those "indispensable parties);

and (2) according to Paul, PB-KBB fraudulently

obtained the prior state-court judgment. In addition,

Paul attempted to re-argue that: (1) there is no privity

between PBQD and PB-KBB, permitting the

application of res judicata; (2) there could be no res

judicata because his FCA claim could not have been

brought in the Texas state court; and (3) the state-

court action and the instant case did not arise "from

the same nucleus of operative facts." Without

3

elaboration, the district court on August 9, 1995

summarily denied Paul’s Rule 60(b) motion. Paul,

Civil Action Number H-92-2429 (S.D. Tex. August 9,

1995).

On September 6, 1995, Paul filed a Notice of

Appeal, in the United States Court of Appeals for the

Fifth Circuit, attempting to reargue many of the

matters previously addressed by the Fifth Circuit.

Specifically, he argued that: (1) jurisdiction over the

FCA suit lies solely in the federal court and, therefore,

he could not have included his FCA claims in his prior

state-court action; (2) the prior state-court judgment

was not a "final judgment on the merits" because: (a)

the Texas state court lacked subject matter jurisdiction

and in personam jurisdiction over purportedly

"indispensable parties," and (b) according to Paul, PB-

KBB fraudulently obtained the prior-state-court

judgment; (3) it was inappropriate for the district court

to rely upon Texas state law when assessing the res

judicata impact of the prior state-court ruling; (4) the

FCA claims and the prior state-court action did not

constitute the same cause of action; and 5) the res

judicata bar is inappropriate because PBQD, BMI and

the United States were not parties to the state-court

action. Paul further argued that a United States

Magistrate Judge was without authority to rule,

without Paul’s consent, on his motion to compel

production of documents, and the case should not have

been dismissed without permitting him to engage in

discovery.

While the appeal of the district court’s denial of

this motion under Rule 60(b) of the Federal Rules of

Civil Procedure was pending, Paul filed, on December

12, 1995, a Petition for Writ of Certiorari in the United

States Supreme Court. In that Petition, Paul sought

review of the district court’s decision dismissing his

4

case, Paul, 860 F. Supp. 370, aff'd without op., 53 F.3d __

1282 (5th Cir. 1995). On January 22, 1996, the Court

denied Paul’s Petition. United States, ex rel. Paul v.

Parsons, Brinkerhoff, Quade & Douglas, Inc., 116 S.Ct.

817 (1996).

Subsequently, on April 26, 1996, the Fifth

Circuit issued its opinion affirming the district court’s

denial of the motion under Rule 60(b) of the Federal

Rules of Civil Procedure. United States, ex rel. Paul v.

Parsons, Brinkerhoff, Quade & Douglas, Inc., 85 F.3d

624 (5th Cir. 1996). The Fifth Circuit, in an

unpublished opinion, found: (1) that Paul had failed to

show that the district court abused its discretion in

denying his motion to dismiss under Rule 60(b)(3)

because of fraud, misrepresentation, or other

misconduct of an adverse party; (2) the absence of

purportedly "indispensable parties" in the Texas state

court trial does not create a jurisdictional defect and

does not provide a basis for collaterally challenging the

state court’s judgment; (3) that Paul’s argument that

the Texas state courts were without jurisdiction to

resolve legal issues involving claims that arose in other

jurisdictions was without merit, because the fact that

a claim arose in another jurisdiction, and may have

impacted that jurisdiction more directly, is not

determinative of the court’s authority to render a

judgment; (4) that Paul had abandoned the issue of the

state court’s personal jurisdiction over contracts

negotiated and executed in Ohio by failing to brief this

issue on appeal; and

(5) that Paul’s argument, that claims against

individuals who were not named in the state court suit

may not be barred by the doctrine of res judicata, is

without merit as the court had previously found that

there was privity among all of the defendants and that

the claims against them were barred.

Paul v. Parsons,

Brinkerhoff, Quade, & Douglas, No. 95-20733, slip op.

5

(5th Cir. April 26, 1996). The Fifth Circuit further

admonished Paul that: .

any additional frivolous appeals filed by

him will invite imposition of sanctions,

Paul is further cautioned to review any

pending appeals to ensure that they are

not frivolous because they have been

previously decided by this court.

Id. Paul’s second appeal was accordingly dismissed

and a sanctions warning issued.

Despite the Fifth Circuit’s clear warning that

"his appeal is frivolous and is dismissed" Paul has

again filed the instant Petition for Writ of Certiorari in

this Court, raising substantially the same issues raised

in his prior Petition for Writ of Certiorari, that was

decided on January 22, 1996. The only difference

between the two petitions is that the standard of

review, if the second petition were granted, would be

whether the district court abused its discretion in

refusing to reconsider the rulings left standing by this

Court’s denial of the first Petition. Such an issue can

hardly merit the Court’s intervention. As there are no

conflicting court decisions with the instant case and

there are no important questions of federal law to be

decided, settled, or that are in conflict with relevant

decisions of this Court, Paul’s Petition should be

denied. See Rule 10 of the Supreme Court Rules.

BACKGROUND FACTS

A. Contract History

From 1965 to the present, BMI has provided

research and development services to the USS.

Department of Energy ("DOE") as the contractor

6

operating the Pacific Northwest Laboratories located in

Richland, Washington. On April 28, 1978, BMI was

assigned responsibility for the management of DOE’s

National Waste Terminal Storage Program. In

particular, BMI was directed to and did establish a new

Project Management Division responsible for

(1) identification of potential sites with salt formations

and/or other geological formations within the United

States suitable for development for potential nuclear

waste repositories, and (2) the coordination and

direction of the development of criteria and specific

technologies required for exploration, design, licensing,

construction, operations, and monitoring of these

repositories.

Effective June 14, 1982, BMI and a joint venture

(comprised of PBQD and PB-KBB) known as Parsons

Brinkerhoff/P.B.-K.B.B. ("PB/PB-KBB") entered into a

subcontract, pursuant to which PB/PB-KBB was to

provide architectural and engineering design services

relating to the construction of exploratory shafts that

would be used to investigate the geological features of

potential nuclear waste disposal sites in salt formations

(the “Subcontract"), On October 7, 1982, DOE

approved the Subcontract.

B. _ Litigation Hist

Paul was hired by PB-KBB in May 1981. In

June 1982, he was assigned to work on the Exploratory

Shaft Facility design, the project encompassed by the

Subcontract. Paul alleges that he soon concluded the

preliminary design specifications were inconsistent

with requirements under federal mine safety standards.

Paul claims that he informed his supervisors, orally

and in writing, of his concerns. According to Paul,

these acts resulted in his transfer to another division

at PB-KBB and, ultimately -- twelve days after drafting

7

a memorandum summarizing his concerns -- to his

discharge.

In 1983, Paul brought a Title VII action in the

United States District Court for the Southern District

of Texas against PB-KBB, Civil Action No. H-83-3409,

alleging that he was discharged on the basis of his

national origin. That action was dismissed without

prejudice by stipulation of the parties on June 7, 1984.

Paul then filed an action under the Federal Mine

Safety and Health Act of 1977 ("Mine Act"), 30 U.S.C.

§ 801 et seg. (1994), with the Secretary of Labor,

wherein he argued that, in violation of § 815(c)(1) of

the Mine Act, he was fired because of his safety

complaints. Paul v. P.B.-K.B.B., Inc., 3 MSHC 2006,

2007 (1985). The Secretary of Labor rejected Paul’s

claim. Id. Paul appealed the Secretary’s decision to

the Federal Mine Safety and Health Review

Commission ("the Commission"). Id. at 2008. The

Commission, however, upheld the Secretary’s decision.

Id. Paul then appealed the Commission’s ruling to the

United States Court of Appeals for the District of

Columbia Circuit, which upheld the Secretary. Paul v.

Federal Mine Safety and Health Review Comm’n, 812

F.2d 717, 718 & 720 (D.C. Cir.), cert. denied, 483 U.S.

1023 (1987).

Undeterred, Paul then brought an action in

Texas state court, alleging that he was wrongfully

discharged for his unwillingness to commit « criminal

act. Paul v. P.B.-K.B.B., Inc., 801 S.W.2d 229 (Tex.

App. -- Houston [14th Dist.] 1990, writ denied). In

that action, Paul contended that "the preliminary study

[prepared by PB-KBB] called for one shaft rather than

two and that this design 'could’ve killed people.” Id.

at 229. Paul argued that, as the engineer, he would be

called upon to certify the plans and specifications, and

doing so would be a violation of § 22.05 of the Texas

8

Penal Code which proscribes "reckless conduct." Id.

According to Paul, it was these objections to the

project, that resulted in his termination. Id. at 230.

After trial, the jury found that Paul was not fired

solely because he refused to commit an illegal act. On

appeal, the verdict was affirmed. Id. at 230.

Paul attempted to dress up his losing state-court

action in new federal clothing by filing a complaint in

the United States District Court for the Southern

District of Texas. However, as the same operative facts

underlay both actions, the district court dismissed his

federal action based on res judicata. This ruling was

affirmed by the Fifth Circuit and Paul’s Petition for

Writ of Certiorari denied by this Court. Paul, 860 F.

Supp. 370 (S.D. Tex. 1994), aff'd without op., 53 F.3d

1282, cert. denied, 116 U.S. 817 (1996).

Paul thereafter filed, in the district court, his

motion for reconsideration of the order dismissing his

federal complaint, pursuant to Federal Rule of Civil

Procedure 60(b). This motion was denied by the

district court and affirmed by the Fifth Circuit. Paul,

H-92-2429 (S.D. Tex. August 9, 1995),

85 F.3d 624 (5th Cir. 1996). Paul then filed the

instant Petition for Certiorari seeking review of the

district court’s denial of his motion for reconsideration

and the Fifth Circuit’s review of that decision.

SUMMARY OF ARGUMENT

Paul’s petition, although presented in five

separate questions, may only raise one issue in this

Court: whether the district court abused its discretion

in denying Paul’s motion, pursuant to Rule 60(b) of the

Federal Rules of Civil Procedure, for relief from that

court’s earlier order dismissing Paul’s qui tam suit on

the basis that Paul’s action was barred by res judicata,

9

where Paul failed to satisfy any of the elements under

Rule 60(b) warranting such relief, but instead offered

only conclusory allegations of purported fraud and of

jurisdictional defects in the prior state-court action.

A. Standard of Review

Rule 60(b) of the Federal Rules of Civil

Procedure provides, in part:

On motion and upon such terms as are

just, the court may relieve a party or a

party’s legal representative from a final

judgment, order, or proceeding for the

following reasons: (1) mistake,

inadvertence, surprise, or excusable

neglect; (2) newly discovered evidence

which by due diligence could not have

been discovered in time to move for a

new trial under Rule 59(b); (8) fraud

(whether heretofore denominated

intrinsic or extrinsic), misrepresentation,

or other misconduct of an adverse party;

(4) the judgment is void; (5) the judgment

has been satisfied, released, or

discharged, or a prior judgment upon

which it is based has been reversed or

otherwise vacated, or it is no longer

equitable that the judgment should have

prospective application; or (6) any other

10

reason justifying relief from the operation

of the judgment....

The review of a district court’s denial of a Rule 60(b)

motion is extremely limited. See Vv

638 F. 2d 801, 803 (5th Cir. Unit B Mar. 1981) ("the

determination of the district court is subject to review

only for an abuse of discretion"); see also Travelers Ins.

Co. v. Lilieberg Enters., Inc., 38 F.3d 1404, 1408 (5th

Cir. 1994) ("[i]t is not enough that the granting of

relief might have been permissible, or even warranted -

- denial must have been so unwarranted as to

constitute an abuse of discretion.") (citation omitted).

Appellate review of the denial of a Rule 60(b) motion,

is further limited to whether the district court abused

its discretion in denying the motion for

reconsideration, but not the underlying judgment. See

Browder v. Director Ill. Dept. of Corrections, 434 U.S.

257, 263 n.7 (1988) ("The Court of Appeals may review

the ruling only for abuse of discretion, however, and an

appeal from denial of Rule 60(b) relief does not bring

up the underlying judgment for review.")

B. Jurisdiction Of The State

Court

Paul sets forth five questions in his Petition. In

questions two, three, and four, Paul attacks the validity

of the state court judgment by arguing that the state

court did not have jurisdiction over the action.

Specifically, in question two of the Petition, Paul

argues that the absence of "indispensable" parties in

the Texas state court case creates a jurisdictional defect

thereby rendering that judgment void. In question

three, Paul contends that the Fifth Circuit erred in

finding that Paul had abandoned his contention that

the state court lacked in personam jurisdiction because

the contracts at issue in the case were negotiated and

11

executed in Ohio, for work performed in Utah,

Louisiana, Texas, and Mississippi. In question four,

Paul challenges the Fifth Circuit’s finding that the

state court had jurisdiction over legal issues involving

claims that arose in other jurisdictions.

1. The Alleged Absence Of

Court Case Does Not Impact The

Paul contends that the state court judgment was

void because "indispensable" parties were not joined.

Although his allegations are unclear, Paul appears to

argue that PB-KBB, in the prior state-court action,

concealed the fact that Paul was replaced on the

project by two Canadians. Because these "Canadians"

were "indispensable" parties in the state-court action,

their absence renders the state-court action void for

lack of subject matter jurisdiction and lack of in

personam jurisdiction over the Canadians. He also

claims that PB-KBB committed fraud in the prior

state-court action because PB-KBB stated that Paul’s

employment was terminated due to a "lack of work,"

after assigning his job functions to the Canadians. See

Pet. at 17. According to Paul, PB-KBB could not

have committed this "fraud and p-rjuries [sic]" in the

state court if the Canadians were joined as parties. Id.

Even if Paul had, in fact, presented newly

discovered evidence to the district court that: (1) he

was replaced by "two Canadians” and (2) PB-KBB’s

explanation for Paul’s termination in the state-court

action was false, and he demonstrated that he

exercised due diligence in discovering the evidence,

such "facts" are not material and do nothing to change

the outcome in this case. Washington v.

Patlis, 916 F.2d 1036, 1038 (5th Cir. 1990) (noting that

12

Rule 60(b) movant must show that the new evidence

would likely produce a different trial result). That is,

even if Paul had been replaced by ‘two Canadians,"

that fact would do nothing to remove the jurisdiction

of the state court in the prior action. Further, even if

PB-KBB had presented a false explanation in the prior

state-court action as to why Paul was terminated, the

state-court judgment would still be valid for purposes

of res judicata. —

Paul’s argument that the absence of

indispensable parties defeated the state court’s

jurisdiction over his case is also without merit. The

state-court action was brought by Paul in a court of

general jurisdiction in Harris County, Texas. See Tex.

Gov't Code Ann. § 24.007 ("Jurisdiction") (Vernon

1988). That action concerned whether, under Texas

state law, Paul had been wrongfully terminated from

his employment in PB-KBB’s Houston, Texas office.

Paul, 801 S.W.2d at 229. Paul, as the plaintiff in that

case, chose the forum and elected to bring the action in

Texas state court. Clearly, there would have been no

basis upon which Paul could have attacked the state

court’s subject matter jurisdiction over his state law

claim before the district court in the instant action.

See generally Restatement (Second) of Judgments § 12

(1982) (noting that parties are precluded from

litigating a "court’s subject matter jurisdiction in

subsequent litigation [unless] [t]he subject matter

jurisdiction of the action is so plainly beyond the

court’s jurisdiction that its entertaining the action was

a manifest abuse of authority"). The district court,

therefore, did not abuse its discretion in rejecting this

meritless argument.

Still, in his Rule 60(b) mution, Paul presented an

assertion that somehow the Texas state court lacked in

personam jurisdiction over "an essential party, the

13

Canadians," who "conspir[ed] to have [] Paul fired,"

and, thus, the state-court judgment was invalid. Paul

makes the same assertion in his Petition. See Pet. at

16. Although the true nature of Paul’s contention is

difficult to ascertain, apparently Paul believes that

after he was terminated, his job functions were

transferred to two Canadians "illegally working" in the

United States, and the "Texas state court{] lack[ed] in

personam jurisdictions [sic] over these foreign citizens,

who are indispensable parties." Paul believes that

these Canadian employees were “indispensable

part[ies]," and the Texas state court’s judgment was

void "due to the... lack of in personam jurisdiction

over [the] Canadian domiciles." Yet, Paul never named

these purported "indispensable parties" as defendants

in the state-court action, and Paul participated fully in

that action, without raising the issue of joinder of

additional parties.

Moreover, even accepting Paul’s groundless

claims that his job functions were transferred to two

Canadians and that he was "unaware" of this "fact,"

Paul has presented no facts to suggest that

indispensable parties were lacking in the prior Texas

state-court action. Rule 39 of the Texas Rules of Civil

Procedure, which parallels Rule 19 of the Federal Rules

of Civil Procedure, addresses the joinder of

indispensable parties. Tex. R. Civ. P. 39 (West 1995);

see also Fed. R. Civ. P. 19. Essentially, the purpose of

the federal and state joinder rules is to ensure that the

interests of all parties to litigation are protected. See

generally Schutten v. Shell Oil Co., 421 F.2d 869, 873

(5th Cir. 1970); Vondy v. Commissioners Court of

Uvalde County, 620 S.W.2d 104, 106-07 (Tex. 1981).

For example, the right of a defendant not to be

subjected to multiple litigation and _ potential

inconsistent obligations are central concerns under

these rules. Id.; Schutten, 421 F.2d at 873. Paul has

14

presented no facts that "the Canadians" had any

interest in the state-court action such that they should

have been joined as parties, and he has not explained

how "the Canadians" could have been liable to Paul

under the applicable state law in that case. Further,

Paul fails to explain how his rights could not be fully

litigated in the prior state-court action or how there

was any possibility of inconsistent judgments. Paul’s

purported newly discovered evidence, therefore, would

do nothing to alter the outcome from the district

court’s dismissal of the action. Consequently, the

district court did not abuse its discretion in denying

Paul’s Rule 60(b) motion. See Paul, 95-20733, slip op.

(5th Cir. April 26, 1996) (noting that in his Appellate

Brief, Paul failed to explain: why the interests of these

absent parties were negatively affected because they

were not joined as defendants in the state court action;

how the absent parties would have been liable to him

under the state law; and why the absence of these

parties created a jurisdictional defect).

2. Paul Has Effectively Abandoned

t The State

icti r

i)

:

—r © Bri

Appeal To The Fifth Circuit

In Question Three, Paul appears to be arguing

that the state court lacked jurisdiction over the original

action because the contracts at issue were negotiated in

other states. The Fifth Circuit found that Paul had

abandoned this issue by failing to brief it on appeal.

Paul, 95-207383, slip op. (5th Cir. April 26, 1996) (citing

to Bri Vv. as Coun u eri ner,

813 F.2d 744, 748 (5th Cir. 1987)). In his Petition,

Paul strenuously objects to this finding, pointing out

the various places that he supposedly raised the issue.

15

See Pet. at 20-24. However, Paul points to various

pleadings in the district court where he purportedly

raised the lack of the state court’s jurisdiction over

contracts negotiated and executed in other states.

Apparently, Paul misunderstands the principle that an

issue not raised on appeal is "effectively abandoned."

See Al-Ra’Id v. Ingle, 69 F.3d 28, 33 (5th Cir. 1995).

Accordingly, Paul’s detailed descriptions of where he

argued this issue in the district court are irrelevant.

Paul also argues that he did brief this issue in

his appeal to the Fifth Circuit of the district court’s

denial of this motion under Rule 60(b), and cites to

various places in his Fifth Circuit Appellate Brief in

which he allegedly raised this issue: (1) in the

Statement of the Case; (2) in Issue Number Three of

his Appellate Brief; and (3) in Issue Number Five of

his Appellate Brief. Contrary to Paul’s contention that

he briefed the issue of the state court’s jurisdiction

over contracts negotiated and executed in other states,

the citations to which he directs this Court relate to

other, miscellaneous issues but do not address his

jurisdictional argument. Accordingly, Paul may not

seek redress in this Court of this particular issue.

3. Paul’s ent That The State

Court Did Not Have Jurisdictio

i t er

Jurisdictions Does Not Impact The

Validity Of That Judgment

In Question Four, Paul appears to argue that

the state court did not have jurisdiction over claims

that arose in other jurisdictions. As the Fifth Circuit

noted:

Paul’s argument goes to the subject-

matter jurisdiction of the state court to

16

eee

adjudicate claims arising in other

jurisdictions. While the place where the

alleged tort occurred may be pertinent to

personal jurisdiction, venue, or the

question of which forum’s law should be

applied, the fact that a claim arose in

another jurisdiction and may have

impacted that jurisdiction more directly is

not determinative of the court’s authority

to render a judgment.

Paul, 95-20733, slip op. (5th Cir. April 26, 1996).

Paul’s argument that the state court did not have

subject matter jurisdiction over certain of his claims is

without merit. Accordingly, the district court did not

err in refusing to grant his motion to reconsider on the

basis that the state court judgment is void for lack of

subject matter jurisdiction.

C. Paul Improperly Raises The District

Court’s Underlying Decision Which Is

Not Reviewable In The Instant Appeal

In question five of the Petition, Paul appears to

be arguing that the district court erred in finding that

his federal action was barred by res judicata. The

district court’s ruling based on res judicata has been

affirmed by the Fifth Circuit and Paul’s previous

Petition for Writ of Certiorari in this Court denied.

See Paul, 860 F. Supp. 370 (S.D. Tex. 1994), aff'd 53

F.3d 1282 (5th Cir. 1995), cert. denied, 116 S.Ct. 817

(1996). Therefore, he cannot raise this issue yet again

in the these proceedings. Rather, the scope of review

in these proceedings is limited to determining whether

the district court erred in denying Paul’s motion to

dismiss under Rule 60(b) of the Federal Rules of Civil

Procedure. It is not to reargue whether the underlying

district court decision, dismissing the case based on res

17

judicata was correct. See Gulf Coast Bldg. and Supply

Co. v. Internation the of ical Workers,

460 F.2d 105, 1107 (5th Cir. 1972) (where a matter has

been affirmed on appeal, "whatever was before the

appellate court and disposed of by the decree is

considered as finally settled and becomes the law of the

case.").

In question one of the Petition, Paul contends

that the district court erred in denying the motion for

reconsideration based on fraud committed during the

Texas state proceedings, which he only discovered

when he filed the instant lawsuit. See Pet. at 14.

Specifically, Paul argues that during the state court

trial, attorneys’ representing PB-KBB, presented

evidence by "perjuring, denying, contradicting and

disputing their prior testimonies to the Federal Mine

Safety Review Commission’s proceedings... ." Id.

According to Paul, as the trial proceeded on an

unscheduled date, Paul was unable to attend the trial

to "challenge" the "fraudulent and perjurious

testimonies [sic] presented by PB-KBB in front of the

Jury." Id. Further, according to the Petition,

testimony presented by PB-KBB was inadmissible

under Texas Rules of Evidence and Texas Rules of

Civil Procedure, rendering the state court judgment

void.

18

Even assuming arguendo that a judgment was

obtained by fraud, that judgment is still res judicata in

a subsequent action, provided the prior court had

jurisdiction to render the judgment. See Vandervoort,

S erso er & Post, P.A. v. Vandervoort

529 F.2d 424, 426 (5th Cir. 1976) (noting that a

‘collateral attack on a judgment" based upon fraud is

‘irrelevant" once "it [has been] determined that the

court’ had jurisdiction"); Midessa Television Co. _v.

Motion Pictures for Television, Inc., 290 F.2d 203, 205

(Sth Cir.), cert. denied, 368 U.S. 827 (1961); see also

Slangal v. Getzin, 148 F.R.D. 691, 694 (D. Neb. 1993)

("Generally, a judgment of a court may not be

collaterally attacked . . . unless the court was without

jurisdiction to reach that decision."); see generally 21

Federal Procedure, L. Ed. § 51:188 (1984) ("As a

general rule, even if a judgment that was obtained by

fraud it is res judicata so long as the court rendering it

had jurisdiction to do so.")

The only exception to the above stated general

rule is that a collateral attack may be permitted on a

prior judgment if the attack is based upon "extrinsic,"

rather than "intrinsic," fraud. Fidelity Standard Life

Ins. Co. v. First Nat’] Bank & Trust Co., 382 F. Supp.

956, 963 (S.D. Ga. 1974) ("[TJhe impeachment of a

foreign judgment is limited to existence of fraud that is

extrinsic in nature... ."), aff'd, 510 F.2d 272 (5th

Cir.), cert. denied, 423 U.S. 864 (1975); Gilbert v.

Franklin County Water Dist., 520 S.W.2d 527, 533

(Tex. Civ. App. -- Texarkana 1975, no writ) ("Neither

a collateral nor direct attack upon a prior judgment can

be based upon intrinsic fraud.") see also Slangal, 148

F.R.D. at 694. "[I]ntrinsic fraud’ [includes] false

testimony, fraudulent instruments, and any fraudulent

matter that was presented and considered in rendering

a judgment." Raney v. Mack, 504 S.W.2d 527, 533

(Tex. Civ. App. -- Texarkana 1973, no writ). By

19

comparison, "fraud that is extrinsic in its nature,

[prevents] one from having a real contest of the suit

based on conduct or activities outside of the court

proceedings themselves." Fideli

Co., 382 F. Supp. at 963. Such "extrinsic" fraud "must

be collateral to the matter tried, and not something

which was actually or potentially in issue in the trial."

Raney, 504 S.W.2d at 533; see generally Restatement

(Second) of Judgments § 70, Comment b. (1982).

In the instant case, the fraud that Paul claims

occurred in the state-court action consists solely of

allegations of "intrinsic" fraud. Paul’s argument is that

in the state-court proceeding, PB-KBB put forth ©

"fraudulent [and] perjurious" explanations as to why

Paul had been dismissed. See Pet. at 13-14. Yet, the

reason for Paul’s termination was the exact issue that

was before the state court. Paul, 801 S.W.2d at 229.

Where the purported fraud "relates to the material

issues in the [] case," then the attack on the prior

judgment solely involves "intrinsic" fraud and cannot be

the basis for a collateral attack. Gilbert, 520 S.W.2d at

505-06. Because the alleged fraud relates solely to the

issue pending before the state court, accepting Paul’s

allegations as true, the outcome of the district court’s

order would have been no different. As the Fifth

Circuit noted:

[e]ven if it its assumed that Paul can

establish by clear and _ convincing

evidence that the defense was predicated

upon factually false testimony, Paul has

failed to demonstrate that he was

prevented from fully and fairly presenting

his state court case. Therefore, Paul has

failed to show that the district court

abused its discretion in denying his

motion under Rule 60(b)(3) because of

20

‘fraud, misrepresentation, or other

misconduct of an adverse party.

Paul, No. 95-20733, slip. op. (5th Cir. April 26, 1996).

CONCLUSION

The petition for a writ of certiorari should be

denied.

Respectfully Submitted,

Frederick Robinson

FULBRIGHT & JAWORSKI, L.L.P.

801 Pennsylvania Avenue, N.W.

Washington, D.C. 20004

202-662-0200

Counsel for Respondent

Battelle Memorial Institute

Project Management Division

21