Overview of the Case

The recent Supreme Court arguments in BLOM Bank SAL v. Honickman harkened back to foundational principles of Civil Procedure. Central to this case is the interpretation of Rule 60 of the Federal Rules of Civil Procedure, which deals with the criteria for reopening a court judgment.

Rule 60 and Its Implications

Rule 60(b) enumerates specific grounds for relief from a judgment, such as clerical mistakes, fraud, or newly discovered evidence. Moreover, it includes Rule 60(b)(6), which serves as a catch-all provision allowing for relief under “any other reason that justifies relief.” Historically, courts have interpreted this exception as necessitating “extraordinary circumstances,” suggesting that standard situations covered in the first five provisions alone suffice to justify reopening a case.

A Complicated Argument: Reopening Judgments

This case involves a civil suit by individuals affected by a series of Hamas attacks against a Lebanese bank accused of providing services to customers with alleged ties to Hamas. Under the Justice Against Sponsors of Terrorism Act, the plaintiffs must demonstrate that the bank “knowingly provid[ed] substantial assistance” to a terrorist organization. The original claim was dismissed due to a lack of evidence showing the bank’s knowledge of its clients’ connections to Hamas.

Initially, the district court invited the survivors to amend their complaint, which they opted not to do. After an appellate court affirmed the dismissal, they sought to reopen the judgment to include previously known but unsubmitted evidence regarding the bank’s knowledge of its customers’ affiliations.

The district court denied this request, citing insufficient extraordinary circumstances, but this was overturned by the Second Circuit, which posited that the standard for extraordinary circumstances should not apply since the plaintiffs had not amended their complaint even once.

Supreme Court’s Reception of the Arguments

During the proceedings, several justices expressed skepticism about the Second Circuit’s conclusion. Justice Elena Kagan challenged the representation of the standard for reopening judgments, suggesting that the lower court’s reasoning was an inconsistent combination of standards from Rules 60 and 15.

Justice Neil Gorsuch supported Kagan’s view, recommending a straightforward ruling clarifying that the stringent Rule 60(b) standard should be maintained without conflating it with Rule 15’s more permissive amendment approach.

Conclusions and Predictions

Justice Amy Coney Barrett remarked on the longstanding interpretation of “extraordinary circumstances,” emphasizing that legal precedent maintains a preference for the finality of judgments. However, the dialogue indicated a willingness among some justices to consider how Rule 15 could interact with Rule 60(b) in judicial discretion.

As the case unfolds, a brief opinion from the Supreme Court is anticipated, potentially clarifying the standards for reopening judgments before the month’s end, with either Gorsuch or Kagan likely authoring the opinion.