Background
Appellants Lauryn Galindo and Daniel C. Susott appealed orders from the District Court for the District of Hawaii. The district court had denied their third motion to disqualify the judge for bias, denied a motion to void judgment under Federal Rule of Civil Procedure sixty subsection B four, and granted prejudgment interest and attorneys’ fees to the Appellees.
The court’s reasoning
The panel unanimously concluded the case was suitable for decision without oral argument. The court held that the law-of-the-case doctrine barred reconsideration of the judge’s alleged actual bias. Regarding the motion to void judgment, the court found no jurisdictional error or due process violation because the constructive trust was imposed against the transferee, not the owner. The court affirmed the award of prejudgment interest due to substantial delay caused by fraudulent transfers and affirmed the award of attorneys’ fees because the appellants’ defenses were frivolous.
What it means going forward
The decision reinforces the finality of prior rulings on judicial bias and confirms that courts may award fees and interest against parties who engage in fraudulent transfers and assert frivolous defenses.