Elk Run, a coal mining company, did something most of us would find reprehensible. When an employee filed for Black Lung benefits, it had three experts analyze his pathology slides. Two provided unfavorable opinions. They went with the third, and handed that evidence to other experts, who found, based on that single report, that the employee, Gary N. Fox, did not have pneumoconiosis. Elk Run presented this at an administrative hearing in 1999.
Fox represented himself, and lost. He did not obtain the two favorable reports in discovery, did not obtain his own reports, and did not cross-examine the unfavorable report's preparer on his qualifications. A few years later, after obtaining counsel, he tried again. This time, he won.
Unfortunately, due to the previous holding, Elk Run is off the hook for all damages prior to the first trip to the Administrative Law Judge. Unless, of course, Fox's surviving spouse can prove that there was a "fraud on the court" to set aside the judgment under Federal Rule of Civil Procedure 60(b)(3), which otherwise places a one-year limit on collateral attacks.
Near Impossible Burden
The ALJ ruled that Elk Run's actions, "taken as a whole, constitute a scheme to defraud." Elk Run argued "zealous advocacy." The Benefits Review Board, in a split decision, found in Elk Run's favor.
At the Fourth Circuit, however, the decision was far more clear.
Fraud on the court is a far higher standard than ordinary fraud. In fact, it takes very reprehensible conduct, which casts aspersion on the court itself, to meet the standard, such as bribing the judge or jury, or otherwise exerting improper influence.
Get a Lawyer
The court spends a number of pages telling, exactly, how Fox botched his own case. It notes that attorneys' fees are covered in winning cases. It also noted that Fox failed to take advantage of the adversarial system to detect the fraud, by cross-examining, presenting his own experts, or conducting discovery.
If there was any fraud, it falls under the "routine evidentiary conflict" or "fraud between the parties" precedent, and certainly doesn't meet the "fraud upon the court" standard.
You may think that Elk Run Coal Company's tactics are shady. They'd argue that the reports are "work product" and that no party is bound by the every conclusion of the experts that it hires.
The Fourth Circuit's response? After opening the opinion by calling the company's conduct "hardly admirable," the court ends the opinion by stating:
"We bestow no blessing and place no imprimatur on the company's conduct, other than to hold that it did not, under a clear chain of precedent, amount to a fraud upon the court."
That's the nicest way we've ever heard of allowing a coal company to defraud a widow.