Basic Services Inc. v. Govt of the VI

• Court: Supreme Court of The Virgin Islands
• Decided: June 9, 2026
• Docket: SCT-CIV-2020-0117
• Status: Published

Opinion

For Publication

IN THE SUPREME COURT OF THE VIRGIN ISLANDS

BASIC SERVICES, INC ) S.Ct. Civ. No. 2020-0117 Appellant/Plaintiff. ) Re: Super. Ct. Civ. No. 231/2012 (STT) ) V ) ) GOVERNMENT OF THE VIRGIN ) ISLANDS ) Appelilee/Defendant ) ) On Appeal from the Superior Court of the Virgin Islands Division of St. Thomas Superior Court Judge: Hon. Denise M. Francois

Argued: June 14, 2022 Filed: June 9, 2026 Cite as: 2026 VI 13

BEFORE MARIA M. CABRET, Associate Justice; IVE ARLINGTON SWAN Associate Justice; and DOUGLAS A. BRADY, Designated Justice.!

APPEARANCES

Robert L. King, Esq King & King Law, PC St. Thomas, U.S.V.I Attorney for Appellant

Kenneth R. Case, Esq Michael R. Francisco, Esq Assistant Attorney General St. Thomas, U.S.V.I Attorney for Appellee

OPINION OF THE COURT

CABRET, Associate Justice.

' Chief Justice Rhys. S. Hodge was recused from this matter. The Honorable Douglas A. Brady sat in his place by designation pursuant to title 4, section 24(a) of the Virgin Islands Code Basic Services, Inc. v. Gov't of the V.1. 2026 VI 13 S. Ct. Civ. No, 2020-0117 Opinion of the Court Page 2 of 15

q1 Basic Services, Inc. (“Basic”) appeals from an order of the Superior Court denying its

motion for relief from the judgment’ under Virgin Islands Rules of Civil Procedure 60(b)(2) and

(b)(6). For the reasons that follow, we affirm the Superior Court’s judgment

I FACTUAL AND PROCEDURAL BACKGROUND

{2 This case arises from a complaint for breach of contract filed by Basic against the

Government of the Virgin Islands. The factual and procedural history of this case was concisely

stated in Basic Servs., Inc. v. Gov't of the Virgin Islands, 7\ V.I. 652 (V.1. 2019) (“Basic P’)

The Virgin Islands Department of Education (“VIDOE”), through the Department of Property and Procurement (collectively, the “Government”), publicized a request for proposal to solicit technological services for schools in the St. Thomas-—St. John District. The request for proposal made clear that a program called the E-Rate Program would partially fund these services. The E-Rate Program is administered by the Schools and Libraries Division (the “SLD”) of the Universal Service Administrative Company (“USAC”) and affords eligible schools and libraries assistance with payment for internet and other technological services

After submitting its proposal, Basic Services won the bidding process and, on April 5, 2005, the Government awarded the company a two-year contract which included a payment schedule under which the Government would pay for 10% of the fees for services rendered by Basic Services, and the E-Rate Program, through USAC, would pay for 90% of those costs. The contract also included a two-tier billing process that required the Department of Education to approve the invoices for the services performed by Basic Services before the company could submit them for payment to USAC. The agreement required the Government to pay its portion

? Designated Justice Brady retired after the Court heard this case, but he fully participated in oral arguments and the case consideration. Under 4 V.1.C. § 31(a), this Court sits in panels of three justices to hear cases, and “[a] decision is determined by a majority vote of a panel.” 4 V.LC. § 31(a); V.I.S.CT. 1.O.P. Introduction § D.1. (“Pursuant to section 4 V.I.C. § 31(a), appeals to the Supreme Court shall be heard by a panel of three justices. The concurrence of any two justices is required for a decision.”). Construing 28 U.S.C. § 46(c), which—like our statute—provides that a panel of three judges hears and determines a case, the Supreme Court noted the following

Under § 46(c), a court of appeals case may be decided by a panel of three judges, and therefore on such a panel two judges constitute a quorum and are able to decide an appeal—provided, of course, that they agree. Invoking this rule, innumerable court of appeals decisions hold that when one of the Judges on a three-judge panel dies, retires, or resigns after an appeal is argued or is submitted for decision without argument, the other two judges on the panel may issue a decision if they agree

Yovino v. Rizo, 586 U.S. 181, 185-86 (2019) (per curiam) (collecting cases) Basic Services, Inc. v. Gov't of the V1 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 3 of 15

of the invoices within 30 days of receipt. The contract also provided that the Government would

(i) encumber sufficient funds to pay its portion of the compensation payable to contractor under this Contract; (ii) remit payment to Contractor within thirty (30) working days of receipt of contractor's invoice for services performed under this contract; and (iii) assist Contractor in securing payment from the SLD for services performed under this Contract, as such assistance may be requested from time to time by contractor

In 2006, the parties amended the contract to extend the arrangement beyond the two years outlined in the original contract; all of the other terms of the original contract remained the same under the extension

In accordance with the contract, the Government paid Basic Services.... USAC, however, did not honor its 90% obligation

As aresult of USAC's nonpayment, Basic Services sued the Government for breach of contract in a complaint filed May 8, 2012

On August I, 2017, the Government moved for summary judgment, maintaining that it did not breach the contract because it paid its 10% portion of the service fees, that it approved the invoices necessary for Basic Services to receive payment from USAC, and that there was no triable issue as to those facts. Basic Services... cross moved for summary judgment

On October 17, 2017, the Superior Court granted the Government's motion for summary judgment and denied Basic Services' cross-motion for summary judgment

Id. at 655-57

q3 Basic timely appealed the Superior Court’s summary judgment order on November 7,

2017. During the pendency of the first appeal, on December 27 and 28, 2017, Basic received two

funding decision letters from USAC (“Decision Letters”). In the Decision Letters, USAC disclosed

that, upon investigation, it determined that “a member of the vendor evaluation committee that

selected Basic” was both a Department of Education employee and a part-time employee of Mr Basic Services, Inc, v. Gov't of the V.1. 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 4 of 15

Sherwin Ray, the owner of Basic. This “conflict of interest [] compromised the competitive

bidding process. Therefore, the FRN [was] denied.”

44 In Basic J, this Court affirmed the Superior Court’s grant of summary judgment in favor of

the Government. Basic, 71 V.I. at 668. On May 3, 2018, June 17, 2019, and August 23, 2019

Basic filed motions for relief from the summary judgment order in the Superior Court under Rule

60(b)(2) and (b)(6) of the Virgin Islands Rules of Civil Procedure. Basic based these motions upon

newly discovered evidence, alleging that the Decision Letters showed that the Government

breached the contract terms and the covenant of good faith when it created the conflict of interest

that compromised the competitive bidding process and caused USAC’s nonpayment on 90% of

the contract. In the alternative, Basic argued that—if the Decision Letters did not constitute newly

discovered evidence—telief still was justified because of the Government’s conduct. On

December 10, 2020, the Superior Court denied Basic’s Rule 60(b) motions for relief, and Basic

timely appealed the denial on January 4, 2021

II JURISDICTION AND STANDARD OF REVIEW

{5 “The Supreme Court [has] jurisdiction over all appeals arising from final judgments, final

decrees or final orders of the Superior Court, or as otherwise provided by law.” Ledesma v. Gov't

of the V.I., 72 V.1. 797, 803 (V.I. 2019) (quoting V.I. CODE ANN. tit. 4, § 32(a)). The Superior

Court’s December 10, 2020, denial of Basic’s motions for relief from summary judgment under

Rule 60(b) was a final order within the meaning of section 32(a) and resolved all claims in the

action. Simon v. Herbert, 69 V.1. 963, 966 (V.I. 2018). This Court has jurisdiction

{6 Inconsidering a motion for relief from judgment under Rule 60(b), a court must “‘strike a

proper balance between the conflicting principles that litigation must be brought to an end and that

justice must be done.’” Kazi v. Colonial Pac. Leasing Corp., 69 V.1. 903, 909 (V.I. 2018) (citation Basic Services, Inc. v. Gov't of the V.1. 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 5 of 15

omitted); see also Bain vy. MJJ Prods., Inc., 751 F.3d 642, 646 (D.C. Cir. 2014) (“A district court

considering a motion for relief from judgment under Rule 60(b) must ‘strike a “delicate balance

between the sanctity of final judgments . . . and the incessant command of a court's conscience that

justice be done in light of all the facts.” *” (citations omitted)).> Because the trial judge “‘is in the

best position to discern and assess all the facts, [she] is vested with a large measure of discretion

in deciding whether to grant a Rule 60(b) motion.’” Bain, 751 F.3d at 646 (citation omitted)

Consequently, we review the denial of a Rule 60(b) motion for abuse of discretion. Suid v. Law

Office of Karin A, Bentz, P.C., 75 V.1. 272, 276 (V.I. 2021). See, also, e.g., Johnson v. Spencer,

950 F.3d 680, 701 (10th Cir. 2020); Bain, 751 F.3d at 646. “An abuse of discretion involves a

finding of clearly erroneous fact, an errant conclusion of law, or an improper application of law to

fact.” Suid, 75 V.I. at 276-77 (quoting Shoy v. People, 55 V.1. 919, 925 (V.I. 2011)). This Court

also exercises plenary review of the Superior Court's underlying application of the law. Simon, 69

V.I. at 966

Il DISCUSSION

{7 Onappeal, Basic argues that the Superior Court erred by denying its motion for relief from

the judgment under Virgin Islands Rule of Civil Procedure 60(b)(2) and/or (b)(6). We address each

argument in turn

A Rule 60(b)(2)

* As this Court has articulated

In this jurisdiction, motions for relief from a judgment or order are governed by Virgin Islands Rule of Civil Procedure 60. V.I. R. Civ. P. 60 is derived from Federal Rule of Civil Procedure 60, and we may look to decisions interpreting analogous federal rules as persuasive authority when applying our own rules

Smith v, Gov't of the Virgin Islands, 67 V.1. 797, 802 n.3 (V.I. 2017) Basic Services, Inc. v. Gov’t of the VI. 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 6 of 15

{8 Under Rule 60(b)(2), a court may relieve a party from a final judgment or order due to

“newly discovered evidence that, with reasonable diligence, could not have been discovered in

time to move for a new trial under Rule 59(b).” V.I. R. Civ. P. 60(b)(2)

q9 “[T]he phrase newly discovered evidence refers to evidence of facts in existence at the

time of trial of which the aggrieved party was excusably ignorant.’” Walters v. Parrott, 58 V.1

391, 415 (V.I. 2013) (quoting United States y. 27.93 Acres of Land, 924 F.2d 506, 516 (3d Cir

1991) (citation and internal punctuation marks omitted)). There are two ways evidence may be

considered “newly discovered” under 60(b)(2) and Walrers. First, the aggrieved party may show

that the evidence itself was in existence at the time of the judgment. Dessout v. Brin, 66 V.1. 308,

313 (V.I. 2017). For example, a crucial document to a case, such as an affidavit or subsequent will,

that pre-dates the judgment and was missing or lost and has now been discovered post-judgment

Second, the aggrieved party may show that the evidence “pertain[s] to facts in existence at the time

of the judgment.” LAJIM, LLC vy. Gen. Elec. Co., 917 F.3d 933, 950 (7th Cir. 2019) (citation

omitted). Thus, the “focus of the court’s inquiry is not necessarily when the evidence itself was

created, but rather whether the newly discovered evidence ‘pertain[s] to facts in existence at the

time of [judgment], and not to facts that have occurred subsequently.’” Lans v. Gateway 2000

Inc., 110 F. Supp. 2d 1, 4 (D.D.C. 2000) (quoting Nat’! Anti-Hunger Coal. v. Exec. Comm. of the

President’s Private Sector Survey on Cost Control, 711 F.2d 1071, 1075 n.3 (D.C. Cir

1983)), aff'd sub nom. Lansv. Digital Equip. Corp., 252 F.3d 1320 (Fed. Cir. 2001). See also, e.g.

In re Hertz Glob. Holdings, Inc. Sec. Litig., 830 Fed. Appx. 393, 396 (3d Cir. 2020); Nat'l Union

Fire Ins. Co. of Pittsburgh v. Alticor, Inc., 2007 WL 2733336, at *8 (6th Cir. 2007); Chilson v

Metro. Transit Auth., 796 F.2d 69, 72 (5th Cir. 1986) (the facts revealed in an audit were “in

existence at the time of the trial,” even though audit itself was not); Kettenbach v. Demoulas, 901 Basic Services, Inc. v. Gov’t of the V.L 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 7 of 15 F. Supp. 486, 494 (D. Mass. 1995) (“[C]ourts of appeals faced squarely with this issue have held

that so long as the ‘evidence pertain[s] to facts in existence at the time of trial, and not to facts that

have occurred subsequently,’ whether the evidence itself came into existence after trial is

immaterial.” (internal citation omitted)); Rosebud Sioux Tribe v. A & P Steel, 733 F.2d 509, 515

16 (8th Cir.), cert. denied, 469 U.S. 1072 (1984) (an individual admitted to perjuring themselves

during deposition testimony, and their post-trial admission of perjury was

“newly discovered evidence” because the perjury existed at the time of trial); Peacock v. Bd. of

Sch. Comm'rs of City of Indianapolis, 72\ F.2d 210, 214 (7th Cir. 1983) (per curiam) (“Material

not in existence until after trial falls within 60(b)(2) only if it pertains to facts in existence at the

time of trial.” (citing Nat’! Anti-Hunger Coal., 711 F.2d at 1075 n.3)).4

410 In addition to demonstrating that evidence is newly discovered, under Rule 60(b)(2), the

aggrieved party also “must show that for some excusable reason the evidence was not

discovered by or otherwise made known to [them].” Dessout, 66 V.I. at 313 (citing Walters, 58

V.I. at 414-15). Further, the new evidence must not be merely cumulative or impeaching, and a

trial court’s consideration of the new evidence must be likely to produce a different result. See

e.g., Metzler Inv. GmbH y. Chipotle Mexican Grill, Inc., 970 F.3d 133, 146-47 (2d Cir. 2020)

Minnesota Supply Co. v. Raymond Corp., 472 F.3d 524, 534 (8th Cir. 2006); Zurich N. Am. v

Matrix Serv., Inc., 426 F.3d 1281, 1290 (10th Cir. 2005); Stridiron v. Stridiron, 698 F.2d 204, 207

(3d Cir. 1983). Cf Phillips v. People, 51 V.1. 258, 281 (V.L. 2009)

1 Newly Discovered Evidence

* Interpretations of analogous rules by other courts may be considered persuasive authority when applying and construing our own rules. Smith, 67 V.1. at 802 n.3, cited in Parris v. Nurse, 76 V.1. 492, 500 (V.I. 2022) Basic Services, Ine. v. Gov't of the VL. 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 8 of 15

€11 In this case, the Superior Court found that “Basic’s Rule 60(b)(2) claim for relief fails

because the Decision Letters were not in existence before judgment and Basic did not exercise due

diligence.” Basic asserts that, although the Decision Letters were not in existence before the

Superior Court’s summary judgment ruling, the facts within the Decision Letters existed before

the judgment, and that therefore the Decision Letters qualify as newly discovered evidence under

the rule. On this issue, we agree with Basic

£12 USAC’s investigation, as reported in the Decision Letters, dated December 27 and 28,

2017, concluded that

Joseph Philbert, a V.I. DOE employee, was a member of a vendor evaluation committee that selected Basic Services, Inc as the service provider for the FRN and also had an association with the service provider. Specifically, it was determined that payments were made to Mr. Philbert by Sherwin Ray, the owner of Basic Services, Inc., during calendar years 2004-2006 when Philbert was employed on a part-time basis by Mr. Ray while also employed by V.I. DOE. FCC rules require applicants ensure an open and fair competitive bidding process The applicant must take an affirmative role in evaluating bids received and should not delegate the evaluation role to anyone associated with a service provider. In order to conduct an open and fair bidding process, the applicant should not have a relationship with a service provider prior to or during the competitive bidding process that could serve to unfairly influence the outcome of a competition. An employee of V.I. DOE engaged in a relationship with a selected service provider and also served on a vendor evaluation committee that selected the service provider, which represents a conflict of interest that compromised the competitive bidding process

{13 But before USAC wrote the Decision Letters, it had already decided to deny Basic’s

requests for payment. A close review of the record shows that on August 18, 2017, approximately

two months before the Superior Court granted summary judgment on October 17, 2017, the

VIDOE received notice from USAC of its intent to deny the funding sought by Basic for 2004 Basic Services, Inc. v. Gov't of the V.1 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 9 of 15

2006.° However, the VIDOE did not advise Basic or its own counsel at the Department of Justice

of USAC’s decision to deny the funding, and Basic did not learn of the denial decision until it

received the December 27 and 28, 2017 Decision Letters. Thus, although the evidence

communicating the reason for the denials, namely, the Decision Letters, did not come into

existence until after the Superior Court granted summary judgment, USAC had made the decision

to deny the funding and sent notification of its intent to deny the funding to the VIDOE before the

Superior Court granted summary judgment. Therefore, USAC’s decision to deny Basic’s funding

was “in existence at the time of trial.” See Dessout, 66 V.I. at 313 (quoting Walters, 58 V.I. at 414

15) (“[T]he aggrieved party must show that the evidence was ‘in existence at the time of trial.’”)

£14 For reasons that are unclear on this record, after learning of USAC’s intent to deny Basic’s

funding in August 2017, the VIDOE did not relay this information to Basic, its contractual partner,

or to the DOJ but, nevertheless, “[e]vidence that was lost, hidden, or unavailable during trial c[an]

qualify as ‘newly discovered evidence.’” Bain, 751 F.3d at 647. Likewise, in Chilson, the Fifth

Circuit ruled that an internal audit report was newly discovered evidence because even though the

audit report was issued after trial, the facts revealed in the audit existed at the time of trial. Chilson,

796 F.2d at 72. Accordingly, we conclude that the Decision Letters qualify as newly discovered

evidence under Rule 60(b)(2) as USAC’s decision to deny funding existed on August 18, 2017

> In the Government’s opposition to Basic’s motion for relief pursuant to Rule 60(b), filed on June 18, 2018, the Government stated that

Upon receipt of Basic’s instant motion, undersigned counsel contacted the VIDOE. On May 14, 2018, VIDOE advised DOJ that it received a “Funding Year 2004-2006 Intent to Rescind/Deny Funds Notification” from USAC dated August 18, 2017. On August 24, 2017, the VIDOE requested a 90-day extension of time from USAC to conduct its own internal investigation to address findings raised in the notice. To date, the VIDOE has not received a response from USAC to its internal audit review dated December 29, 2017 Basic Services, Inc. v. Gov't of the V.1 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 10 of 15

before the entry of summary judgment. See Dessout, 66 V.I. at 312. Thus, we disagree with the

Superior Court that Basic failed to assert “newly discovered evidence.”

2 Reasonable Diligence

415 Under Rule 60(b)(2), Basic must also demonstrate that it exercised reasonable diligence

The Superior Court ruled that Basic failed to exercise reasonable diligence because it did not

subpoena or depose any officials from USAC and Basic failed to request a stay pending the results

of USAC’s investigation. The Superior Court also reasoned that Basic had the ability to uncover

the problematic presence of its employee on the vendor evaluation committee through reasonable

diligence. We agree that Basic failed to exercise reasonable diligence

4.16 “Generally speaking, due diligence is ‘such a measure of prudence, activity, or assiduity,

as is properly to be expected from, and ordinarily exercised by, a reasonable and prudent person

under the particular circumstances; not measured by any absolute standard, but depending on the

relative facts of the special case.’” Est. of Skepple v. Bank of Nova Scotia, 69 V.1. 700, 741 (V.1

2018) (internal citation omitted). Reasonable diligence “derives its form from both context and by

comparison to other standards, such as excusable neglect.” Jd. “To demonstrate reasonable

diligence, a [party] must establish[] that [it] pursued the [issue] with those qualities of attention,

knowledge, intelligence and judgment.” Jd. (quoting Santiago v. V1. Hous. Auth., 57 V.1. 256, 273

(V.I. 2012)). In the context of Rule 60(b)(2), this inquiry “looks not to what the litigant actually

discovered, but what he or she could have discovered.” Int'l Ctr. for Tech. Assessment y. Leavitt,

468 F. Supp. 2d 200, 207 (D.D.C. 2007) (quoting 12 JAMES W. MooRE ET AL., Moore's FEDERAL

PRACTICE § 60.42[5] (Matthew Bender 3d ed. 2018) (emphasis in original))

{17 Thus, under the governing standard Basic had to demonstrate “that the failure to produce

the newly discovered evidence did not result from a lack of diligence in [its] part, and that the Basic Services, Inc. v. Gov't of the V.L 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 11 of 15

evidence could not by the exercise of due diligence have been discovered in time to present it in

the original proceeding.’” /d. (quoting Lans, 110 F. Supp. 2d at 5-6). Looking at the facts of this

case, the question is what Basic could have done to discover USAC’s reason for the investigation

and ultimate denial of payment and whether Basic’s inability to discover this information is due to

some excusable reason. See Int’l Ctr. for Tech. Assessment, 468 F. Supp. 2d at 207 (citations

omitted). After not receiving payment from USAC, Basic sent USAC a letter inquiring about the

nonpayment of the outstanding invoices and enlisted the Government’s aid in an attempt to secure

USAC’s promised payment.® In response, USAC stated that there was “no firm date [for

resolution] but the matter is being actively worked on.” Basic Servs., Inc, 71 V.I. at 665.’

£18 Basic claims that it believed that the reason USAC had not transmitted the payment was

VIDOE’s untimely acceptance and submission of invoices to USAC. After Basic was unable to

obtain an explanation or a deadline for USAC’s decision on the payment, Basic could have

endeavored to obtain information about USAC’s ongoing investigation through discovery. Basic

did not do so. When the Superior Court granted the Government’s motion for summary judgment

in 2017, Basic had served just one set of interrogatories on the VIDOE, filed two motions to extend

the discovery deadline, and one motion to amend. But Basic failed to subpoena or depose a single

* On November 21, 2008, Basic mailed a letter to USAC inquiring into the status of the outstanding invoices. On December 17, 2008, USAC responded by letter and stated that it was “in the process of reviewing the documentation that was provided and will follow up should any additional documentation be necessary.” On August 29, 2011, Basic sent a letter to Dr. Clinton Stapleton, the IT Director at the VIDOE Office of Instructional Technology documenting the total amount due to Basic under the contract for its services. The VIDOE was obligated by the contract to “assist Contractor in securing payment from the SLD for services performed under this Contract, as such assistance may be requested from time to time by contractor.” Basic /, 71 V.I. at 655. In compliance, VIDOE contacted USAC via email in an attempt to learn the status of USAC’s funding decision on December 28, 2011, May 8, 2012, and May 17, 2012 ’ The Government acted as an intermediary between Basic and USAC throughout the duration of the contract, and the Government separately inquired of USAC regarding USAC’s reason for non-payment. Basic Servs., Inc., 71 V.I. at 655. The “[e]mail exchanges between the Government and USAC show that the Government requested that USAC state its reasons for the delay in payment, receiving assurances that USAC was ‘working with the FCC to get final resolution . . . in the near future.’” /d. at 665 Basic Services, Inc. v. Gov’t of the V.1. 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 12 of 15

witness, including any representatives from USAC. Basic took no action to learn the reasons for

USAC’s investigation or try to uncover any additional issues and offers no justification for its

failure to depose any officials from USAC or the VIDOE Office of Instructional Technology. Had

Basic deposed any officials from USAC or the Office of Instructional Technology and questioned

them about the ongoing investigation, Basic may have discovered that USAC’s reason for denying

payment was the placement of “a former part-time employee of Basic on the bid review committee

creating a conflict of interest.” Additionally, Basic neglected entirely to inform the Superior

Court of USAC’s ongoing investigation or move for a stay of the case pending the results of

USAC’s investigation

419 At the core of reasonable diligence are the concepts of attention and assiduity, but Basic

failed to litigate its claim with these principles. See Est. of Skepple, 69 VI. at 741 (quoting Santiago

v. VIL. Hous. Auth., 57 V.1. 256, 273 (V.1. 2012)). Had Basic used reasonable diligence, it might

easily have discovered that the reason for USAC’s ongoing investigation and ultimate denial of

payment was the conflict of interest. Basic’s failure to diligently litigate its claim resembles the

circumstances presented in Befterbox Commce’ns, Ltd. v. BB Techs., Inc., 300 F.3d 325, 332 (Gd

Cir. 2002), where the defendant “did not attempt to depose or subpoena anyone [and] also did not

ask for a trial continuance for the purpose of obtaining evidence.” The Third Circuit concluded

that these failures did not demonstrate due diligence under Rule 60(b) of the Federal Rules of Civil

Procedure. /d. Similarly, in the present case Basic did not utilize available discovery tools to

determine the reason for USAC’s investigation or move for a stay. Therefore, Basic failed to

exercise reasonable diligence. See also Bain, 751 F.3d at 649 (affirming the district court’s

determination that a party failed to exercise reasonable diligence when it did not request

intervention from the court) Basic Services, Inc. v. Gov't of the V.1. 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 13 of 15

{20 Because Basic failed to exercise reasonable diligence, our analysis ends here. Basic has

failed to establish a claim for relief under Rule 60(b)(2) and we do not need to proceed to consider

whether “the evidence [is] admissible and of such importance that it probably would have changed

the outcome, [or] the evidence [is] merely cumulative or impeaching.” Metzler Inv. Gmbh v

Chipotle Mexican Grill, Inc., 970 F.3d 133, 146-47 (2d Cir. 2020) (quoting United States v. Int’l

Bhd. of Teamsters, 247 F.3d 370, 392 (2d Cir. 2001)). See Minnesota Supply Co. v. Raymond

Corp., 472 F.3d 524, 534 (8th Cir. 2006) (concluding a party’s claim under Rule 60(b)(2) failed

because it did not exercise due diligence and not reaching the issue of materiality); Zurich N. Am.,

426 F.3d at 1290 (holding that a party failed to show newly discovered evidence or demonstrate

reasonable diligence); cf Phillips v. People, 51 V.I. 258, 281 (V.I. 2009) (stating that newly

discovered evidence was merely cumulative and impeaching without further discussion).°

Accordingly, we affirm the order of the Superior Court denying Basic’s request for relief because

Basic failed to exercise reasonable diligence under Rule 60(b)(2)

B Rule 60(b)(6)

{21 In addition to petitioning for relief under Rule 60(b)(2), Basic requested relief pursuant to

subparagraph 6 of Rule 60(b). Rule 60(b)(6) permits the Superior Court to relieve a party from a

final judgment or order for “any other reason that justifies relief.” V.I. R. Civ. P. 60(b)(6). A

movant must demonstrate extraordinary and special circumstances to justify relief under the

catch-all” provision of Rule 60(b)(6). Hodge v. McGowan, 50 V.I. 296, 309 n.8 (V.I. 2008). See

8 The Superior Court concluded that the Decision Letters could not be newly discovered evidence because even though they reported the conflict of interest in the vendor evaluation committee that occurred years earlier, the conclusion of USAC’s investigation and resulting denial of payment based upon that conflict only occurred after its summary judgment ruling and that Basic failed to exercise diligence in discovering the evidence; consequently, it did not reach the third and fourth elements of the standard for relief, that is, the evidence is not cumulative and it likely would produce a different result Basic Services, Inc. v. Gov't of the V.1 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 14 of 15

Gonzalezv. Crosby, 545 U.S, 524, 535 (2005); see also Ruiz v. Jung, 8. Ct. Civ. 2008-035, 2009

WL 3568182, at *5 (V.I. Oct. 19, 2009) (unpublished); Lucan Corp. v. Robert L. Merwin & Co

S. Ct. Civ. No. 2007-15, 2008 WL 901492, at *2 (V.I. Jan. 7, 2008) (unpublished). The “[rJule

does not particularize the factors that justify relief];] it “provides courts with authority

‘adequate to vacate judgments whenever such action is appropriate to accomplish justice[.]’”

Liljeberg v. Health Services Acquisition Corp., 486 U.S. 847, 863-64 (1988) (quoting Klapprott

v. United States, 335 U.S. 601, 615 (1949)). Indeed, Rule 60(b)(6) has been eloquently described

as a “grand reservoir of equitable power to do justice in a particular case.’” Johnson, 950 F.3d at

700-01 (quoting Kile v. United States, 915 F.3d 682, 687 (10th Cir. 2019) (quoting Cashner v

Freedom Stores, Inc., 98 F.3d 572, 579 (10th Cir. 1996))); Martinez-McBean v. Gov't of the V.L,

562 F.2d 908, 911 (3d Cir. 1977) (quoting 7 MOORE’S FEDERAL PRACTICE § 60.27[2] at 375 (2d

ed. 1975))

4/22 However, this “reservoir of equitable power” conferred by the subsection is not unlimited

“As a leading treatise on federal civil practice puts it, ‘much authority’ establishes that ‘clause (6)

and the first five clauses [of Rule 60(b)] are mutually exclusive’ and that ‘relief cannot be had

under clause (6) if it would have been available under the earlier clauses." Mills v. Comm'r, 102

F.4th 1235, 1241 (11th Cir. 2024) (quoting 11 CHARLES A. WRIGHT, ARTHUR R. MILLER & MARY

KAY KANE, FEDERAL PRACTICE & PROCEDURE § 2864 (3d ed. Apr. 2023)). As the Supreme Court

of the United States recently stated, “Rule 60(b)(6) provides only grounds for relief not already

covered by the preceding five paragraphs.” BLOM Bank SAL v. Honickman, 605 U.S , 145

S.Ct. 1612, 1619 (2025). If Rule 60(b)(6) did otherwise, “the catchall provision could swallow the

preceding paragraphs and ‘b[e] used to circumvent’ their time bars.” /d. (quoting Liljeberg, 486

U.S. at 863 n. 11). Because Basic’s motion for relief is based upon grounds specified in Rule Basie Services, Inc. v. Gov't of the V.1L 2026 VI 13 S. Ct. Civ. No. 2020-0117 Opinion of the Court Page 15 of 15

60(b)(2), there are no extraordinary circumstances upon which relief is available under Rule

60(b)(6). Therefore, the Superior Court did not err in denying Basic’s motion for relief under Rule

60(b)(6) IV CONCLUSION

423 Under Rule 60(b)(2), the Decision Letters are newly discovered evidence, as they contain

facts in existence at the time of the judgment. However, Basic failed to exercise reasonable

diligence to determine USAC’s reason for non-payment, and its claims under Rule 60(b)(2)

therefore fail. Basic’s argument under Rule 60(b)(6) also fails because it reiterates the same

arguments that it advanced under Rule 60(b)(2), and Rule 60(b)(6) provides only grounds for relief

that are not already covered by Rule 60(b)(1)-(5). Therefore, the Superior Court was correct in

denying Basic’s motion for relief pursuant to Rule 60(b)(2) and (6), and we affirm the judgment

of the Superior Court

Dated this 9 day of June, 2026

BY THE COURT

A AB , is

Associate Justice

ATTEST

DALILA E. PATTON, ESQ Clerk of the Court i | By Ky ako fo Deputy Clerk |!

lo- = KORG f