PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

SOUTH ATLANTIC LIMITED 

PARTNERSHIP OF TENNESSEE, LP;

SOUTH ATLANTIC INCOME PROPERTIES,

LLC; SOUTH ATLANTIC MANAGEMENT

COMPANY,

Plaintiffs-Appellees,

v.

DAVID R. RIESE; GARY PLICHTA,

Defendants-Appellants,

and  No. 02-2274

GIBRALTAR COMPANIES OF TENNESSEE,

INCORPORATED; GIBRALTAR

COMPANIES, INCORPORATED,

Defendants,

v.

E. STEPHEN STROUD; GRACE D.

RAMSEY; STEVE SIMPSON,

Third Party DefendantsAppellees. 

Appeal from the United States District Court

for the Eastern District of North Carolina, at Raleigh.

Malcolm J. Howard, District Judge.

(CA-96-901-5-H-1)

Argued: October 28, 2003

Decided: January 30, 2004

Before MOTZ, TRAXLER, and KING, Circuit Judges.
Vacated and remanded by published opinion. Judge King wrote the

opinion, in which Judge Motz and Judge Traxler joined. 

COUNSEL

ARGUED: Sean Eric Andrussier, WOMBLE, CARLYLE, SANDRIDGE & RICE, P.L.L.C., Raleigh, North Carolina, for Appellants.

Kenneth Ray Wooten, WARD & SMITH, P.A., New Bern, North

Carolina, for Appellees. ON BRIEF: Pressly M. Millen, WOMBLE,

CARLYLE, SANDRIDGE & RICE, P.L.L.C., Raleigh, North Carolina, for Appellants. E. D. Gaskins, Jr., EVERETT, GASKINS, HANCOCK & STEVENS, Raleigh, North Carolina, for Appellees. 

OPINION

KING, Circuit Judge:

David Riese and Gary Plichta have initiated this appeal from an

October 1, 2002, judgment entered by the district court. South Atl.

Ltd. P’ship of Tenn. v. Riese, 5:96CV901H1 (E.D.N.C. Oct. 1, 2002).

Riese and Plichta maintain that the 2002 judgment improperly modified the court’s earlier May 6, 1999, judgment, which had been

affirmed on appeal. South Atl. Ltd. P’ship of Tenn. v. Riese,

5:96CV901H1 (E.D.N.C. May 6, 1999); aff’d by South Atl. Ltd.

P’ship of Tenn. v. Riese, 284 F.3d 518 (4th Cir. 2002) (hereinafter

"SALT I"). As explained below, the 2002 judgment contravened the

mandate rule, and we therefore vacate and remand. 

I.

In order to determine whether entry of the 2002 judgment contravened our mandate in SALT I, we must understand the procedural

history of this litigation. This procedural history can be, for organizational purposes, divided into three periods — the period prior to May

6, 1999 (the "Pre-Judgment" period); the period between May 6,

1999, and the issuance of the SALT I mandate on May 14, 2002 (the

"Post-Judgment" period); and the period following issuance of the

2 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
SALT I mandate (the "Post-Mandate" period). Prior to reviewing this

procedural history, we will briefly relate the relevant facts underlying

this dispute.

A.

In the 1980s, David Riese and Gary Plichta (the "Riese Group")

joined efforts to develop a multi-family residential community,

known as Lexington Apartments (the "Lexington"), near Nashville,

Tennessee. In 1993, in order to secure the capital necessary to

develop the Lexington, the Riese Group joined forces with E. Stephen

Stroud, Stroud’s wife Grace Ramsey, and Steven Simpson (the

"Stroud Group"). The Stroud Group and the Riese Group then formed

a limited partnership, called South Atlantic Limited Partnership of

Tennessee ("SALT" or the "Partnership"), to develop real estate in the

Nashville area. The Partnership was structured so that SALT owned

the Lexington. The Riese Group owned twenty-five percent of SALT,

and the other seventy-five percent was controlled by the Stroud

Group. 

Rather than retain a third-party to oversee development of the Lexington, the Partnership authorized the Riese Group to form Gibraltar

Companies of Tennessee, Incorporated ("Gibraltar")1 to serve as its

general construction contractor. SALT and Gibraltar entered into a

general contractor agreement in August 1994, pursuant to which

Gibraltar was required, inter alia, to achieve substantial completion

of the Lexington within eighteen months of commencing construction. 

The beginning of the Lexington’s construction was delayed almost

six weeks, and several additional delays occurred after construction

commenced. In January 1996, citing concerns stemming from con1As in SALT I, two Gibraltar Companies — Gibraltar Companies of

Tennessee, Incorporated and Gibraltar Companies, Incorporated — are

defendants, but the general construction contractor was Gibraltar Companies of Tennessee, Incorporated. The distinction between the Gibraltar

companies is immaterial to this appeal, and we refer to them both collectively and individually as "Gibraltar." SALT I at 523 n. 1. 

SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 3
struction quality and delays, SALT replaced Gibraltar with a new

general contractor, and the Lexington was completed in August 1996.

Meanwhile, in January 1996, Prudential Insurance Company executed a letter of intent to purchase the Lexington. In May 1996,

Stroud’s attorney notified the Riese Group that an audit reflected that

the Riese Group and Gibraltar had engaged in financial improprieties

during construction of the Lexington. Stroud’s attorney also informed

the Riese Group that, as a result of these improprieties, it would be

expelled from SALT on May 31, 1996. According to the Stroud

Group, SALT’s book value was less than zero at the end of May

1996. Pursuant to the partnership agreement, therefore, the Riese

Group received nothing for its twenty-five percent ownership interest

in SALT. On June 11, 1996, eleven days after the Riese Group was

expelled from the Partnership, Prudential purchased the Lexington

from SALT for $17,640,000, netting SALT a profit of approximately

$1,200,000. 

B.

1. THE PRE-JUDGMENT PERIOD

In October 1996, SALT, along with its general partner (South

Atlantic Income Properties, L.L.C.) and its majority limited partner

(South Atlantic Management Company) (collectively, the "SALT

Group"), filed suit against the Riese Group and Gibraltar in the Eastern District of North Carolina. The Riese Group and Gibraltar

responded with counterclaims against the SALT Group and with

third-party claims against the Stroud Group. The various claims in the

lawsuit included breaches of contract, breaches of fiduciary duties,

and violations of North Carolina’s Unfair Trade Practices Act (the

"UTPA"). SALT I at 524. 

A jury trial was conducted in the Eastern District of North Carolina

in November 1998. Upon its conclusion, the jury rendered its Verdict,

finding: (1) that the Riese Group had breached its fiduciary duties to

SALT; (2) that Gibraltar had breached its contractual obligations to

SALT; and (3) that the SALT Group, the Stroud Group, the Riese

Group, and Gibraltar had each engaged in unfair and deceptive trade

practices. On November 19, 1998, the court entered judgment on the

4 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
Verdict.2

 On December 4, 1998, the Riese Group and Gibraltar moved

the court, pursuant to Rules 59 and 60(a) of the Federal Rules of Civil

Procedure, to correct certain clerical errors in the judgment. Specifically, they sought to amend the judgment to reflect that the breach of

contract aspect of the Verdict related only to Gibraltar, rather than to

all defendants, and that the Riese Group and Gibraltar’s UTPA award

was against the Stroud Group as well as the SALT Group. On March

10, 1999, in conformity with those requests, the court entered an

Amended Judgment. 

On March 24, 1999, the SALT and Stroud Groups sought, pursuant

to Rule 60(a), to amend the judgment a second time. They sought to

remove Gibraltar Companies, Incorporated, as a counter-claimant and

third-party plaintiff in the Amended Judgment of March 10, 1999.

They also sought to have the judgment reflect that they (the SALT

and Stroud Groups) were jointly and severally liable for their UTPA

violations, and that the Riese Group and Gibraltar were jointly and

severally liable for their UTPA violations. Finally, the SALT and

Stroud Groups requested the court to aggregate the SALT Group’s

total recovery in the judgment (i.e., aggregate its recovery of costs

with its recovery for Gibraltar’s breach of contract and the Riese

Group’s and Gibraltar’s UTPA violations). 

On March 29, 1999, the Riese Group and Gibraltar filed a crossmotion, pursuant to Rule 60(a), also seeking to amend the judgment

for a second time. Although they agreed with certain of the amendments proposed by the SALT and Stroud Groups, they opposed the

aggregation of the SALT Group’s total recovery. The Riese Group

and Gibraltar noted that the SALT Group’s various awards were not

rendered against the same parties. See infra note 5. They contended,

therefore, that aggregating the claims "could be potentially confusing

2Because of the complexity of this litigation, the Verdict included ten

pages of special interrogatories. Indeed, the trial judge observed that it

"was one of the most complex cases I’ve run into now in more than a

decade on the bench." The judgment entered on November 19, 1998, was

the first of four judgments entered by the district court. An Amended

Judgment was entered on March 10, 1999, and a Second Amended Judgment was entered on May 6, 1999. The most recent judgment (at issue

in this appeal) was entered on October 1, 2002. 

SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 5
for court personnel (including state court personnel) attempting to

deal with [the] judgment . . . ." 

While the Rule 60(a) motions were pending, the parties proceeded

to appeal various aspects of the Amended Judgment. The SALT and

Stroud Groups filed their notice of appeal on April 9, 1999, and the

Riese Group and Gibraltar filed a notice of appeal on April 22, 1999.

On May 1, 1999, we consolidated these two appeals (Nos. 99-1497(L)

and 99-1552, respectively).

2. THE POST-JUDGMENT PERIOD

On May 6, 1999, while the two consolidated appeals were pending

in this Court, the district court amended the judgment for a second

time, entering its Second Amended Judgment. Despite the Riese

Group and Gibraltar’s objection to aggregation of the SALT Group’s

total recovery, the Second Amended Judgment provided that the

SALT Group "collectively shall have . . . a total recovery, exclusive

of interest, of $1,578,765.94."3

3The Second Amended Judgment, which we affirmed in SALT I, provided as follows: 

[P]laintiffs collectively [(i.e., SALT Group)] shall have and

recover: (1) of defendant Gibraltar Companies of Tennessee,

Inc., $1,100,000.00 for breach of contract, with interest at the

State of North Carolina legal rate from January 17, 1996, until

March 9, 1999, and interest at the federal legal rate from March

10, 1999 until paid; (2) plaintiffs collectively shall have and

recover of defendants Gary Plichta and David Riese, jointly and

severally, $1.00 for breach of fiduciary duty; with interest at the

State of North Carolina legal rate from October 25, 1996 until

March 9, 1999, and interest at the federal rate from March 10,

1999, until paid; (3) from all of the defendants [(i.e., the Riese

Group and Gibraltar)], jointly and severally, $450,000.00 for

unfair and deceptive trade practices plus interest on $150,000.00

at the State of North Carolina legal rate from October 25, 1996

until March 9, 1999, and interest on $450,000.00 at the federal

legal rate from March 10, 1999, until paid; and (4) costs in the

amount of $28,764.94; for a total recovery, exclusive of interest,

of $1,578,765.94. 

6 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
On May 14, 1999, eight days after entry of the Second Amended

Judgment (the "Judgment"), the SALT and Stroud Groups moved the

district court, pursuant to Rule 62(d), to stay the Judgment without

requiring bond (the "Bond Motion"). On June 2, 1999, the Riese

Group and Gibraltar filed a motion to stay execution of the Judgment

pending appeal. In support of the Bond Motion, the SALT and Stroud

Groups asserted that the two motions raised the issue of "how properly to treat [the Riese Group and Gibraltar’s] recovery on their counterclaim to offset [the SALT Group’s] recovery on [its] claims, for

purposes of execution." They contended that the court should amend

the Judgment again to adopt a net recovery approach to the various

awards, that is, by: (1) aggregating the SALT Group’s recovery with

the Stroud Group’s recovery; (2) aggregating the Riese Group’s

recovery with Gibraltar’s recovery; and (3) setting off the Riese

Group and Gibraltar’s total recovery against the SALT and Stroud

Groups’ total recovery (the "Net Recovery Approach"). 

The SALT and Stroud Groups sponsored the Net Recovery

Approach because, pursuant thereto, the recoveries of all parties other

than the SALT Group would be eliminated by the awards rendered

against them, and the SALT Group would receive a net recovery,

exclusive of interest, of $678,765.94.4 The Riese Group and Gibraltar

IT IS FURTHER ORDERED third-party plaintiffs collectively

[(i.e., the Riese Group and Gibraltar)] shall have and recover of

plaintiffs and third-party defendants [(i.e., the SALT Group and

Stroud Group)], jointly and severally, $900,000.00 for unfair and

deceptive trade practices, plus interest on $300,000.00 with

interest at the State of North Carolina legal rate from February

28, 1997, until March 9, 1999, and interest on $900,000.00 at the

federal legal rate from March 10, 1999, until paid; for a total

recovery, exclusive of interest, of $900,000. 

4The SALT and Stroud Groups’ interest in the Net Recovery Approach

apparently arose from two concerns. First, they recognized that, unless

Gibraltar recovered some portion of the $900,000 awarded collectively

to Riese, Plichta, and Gibraltar for the SALT and Stroud Groups’ UTPA

violations, Gibraltar, as a minimally capitalized corporation, may be

unable to pay any of its $1.1 million breach of contract liability to SALT.

The SALT and Stroud Groups wanted to ensure, therefore, that Riese and

SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 7
responded to the Bond Motion by asserting that the court, in resolving

the SALT Group’s earlier Rule 60(a) motion, had already declined to

adopt the aggregation proposal of the Net Recovery Approach. They

contended that the SALT and Stroud Groups’ inclusion of the allocation and setoff issue in the Bond Motion was simply an effort to relitigate an issue the court had already resolved. Concerned that the

SALT and Stroud Groups would continue to pursue a net recovery

theory, the Riese Group and Gibraltar requested the court to "issue an

order that makes clear once and for all that Plaintiffs are not entitled

to a ‘net recovery’ against Riese and Plichta." 

On July 2, 1999, while the two consolidated appeals were pending

in SALT I, the district court entered an order rejecting the Net Recovery Approach. South Atl. Ltd. P’ship of Tenn. v. Riese, 5:96CV901H1

(E.D.N.C. July 2, 1999) (hereinafter, the "Rejection Order"). In the

Rejection Order, the court observed that it had "awarded a $900,000

judgment for Riese, Plichta and Gibraltar Companies of Tennessee

against Stroud, Ramsey, Simpson and [SALT]."5 The court also noted

Plichta, as the shareholders, directors, and principal officers of Gibraltar,

were required to record the $900,000 judgment on Gibraltar’s behalf.

Second, the Stroud Group was concerned that, because it, along with the

SALT Group, had been found jointly and severally liable for violating

the UTPA, Riese and Plichta would choose to record the Judgment

against the Stroud Group alone. And the Stroud Group understood that,

without some form of aggregation, it would be unable to offset its UTPA

liability against any recovery it received in the Judgment. 

5The recoveries authorized under the Judgment (exclusive of costs and

interest) are summarized in the following table: 

Recovering Party Liable Party Amount Claim

SALT Group Gibraltar $1,100,000 breach of

contract

SALT Group Riese Group $1 breach of

fiduciary duty

SALT Group Riese Group and $450,000 three UTPA

Gibraltar violations

Riese Group and SALT and Stroud $900,000 two UTPA

Gibraltar Groups violations

("collectively")

8 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
that "[t]here can be no ‘net’ recovery because separate defendants

must pay the judgments of $1,100,000, $450,000 and $1.00." The

Rejection Order provided that "[t]he only true ‘net’ recovery would

be on the unfair and deceptive trade practices cross-claims between

defendants’ [sic] Riese, Plichta and [Gibraltar] and third-party defendants Stroud, Ramsey, Simpson and [SALT]." The court noted, however, that such a net recovery would favor the Riese Group and

Gibraltar rather than the SALT and Stroud Groups.

On July 14, 1999, the SALT and Stroud Groups filed a notice of

appeal from the Rejection Order. On July 22, 1999, they filed their

docketing statement in SALT I, listing the issues they would raise on

appeal. These issues included: 

1. Whether the offset for purposes of execution, as proposed by Appellants and disallowed by the District Court

[(i.e., the Net Recovery Approach)], is appropriate? 

2. If not, how should the judgment be applied for purposes

of execution? 

(emphasis added). On August 2, 1999, we consolidated the SALT and

Stroud Groups’ appeal of the Rejection Order (No. 99-1987) with the

consolidated appeals in SALT I. 

On September 13, 2001, the SALT and Stroud Groups filed their

brief in SALT I. Although their docketing statement asserted that they

would raise the issue of how the Judgment should be applied for purposes of execution, that issue was not addressed. On October 30,

2001, when we heard argument in SALT I, the SALT and Stroud

Groups did not raise or address the issue of how the Judgment should

be applied for purposes of execution. On March 22, 2002, we issued

our opinion in SALT I, affirming the Judgment "in all respects."

SALT I at 542. 

On April 9, 2002, the SALT and Stroud Groups filed a Petition for

Rehearing with Rehearing En Banc (the "Petition"). In the Petition,

they asserted that "the jury awarded . . . $300,000 to the Riese

Group," and that the result of the UTPA determination in SALT I "is

SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 9
that the Riese Group stands to recover from the Stroud Group

$450,000, plus interest." On May 6, 2002, we denied rehearing and

rehearing en banc. On May 14, 2002, we issued our mandate in SALT

I, affirming the Judgment.6

3. THE POST-MANDATE PERIOD

On May 16, 2002, the Riese Group recorded its $900,000 judgment

against the Stroud Group in Wake County, North Carolina. As the

sole shareholders, directors, and principal officers of Gibraltar, however, the Riese Group did not record the judgment on Gibraltar’s

behalf. The following day, the SALT and Stroud Groups returned to

the district court and sought relief pursuant to Rule 54(c),7 requesting

the court to adopt a net recovery approach to the UTPA awards by

making the following allocations and setoffs:

1. Allocate one-half of the $900,000.00 liability of

[SALT] and the Stroud Group to Gibraltar and allocate the

other one-half to Riese and Plichta; and 

2. Order that Gibraltar’s entitlement to $450,000.00 is

more than offset by its $1.1 million liability to [SALT] and

order that Riese and Plichta’s entitlement to $450,000.00 is

offset by their liability of $450,000.00 to [SALT] . . . . 

(the "UTPA Net Recovery Approach"). 

6Pursuant to Rule 41(a) of the Federal Rules of Appellate Procedure,

"[u]nless the court directs that a formal mandate issue, the mandate consists of a certified copy of the judgment, a copy of the court’s opinion,

if any, and any direction about costs." We did not issue a formal mandate

in SALT I. Our mandate of May 14, 2002, consisted of our Opinion and

the Certified Copy of Judgment. South Atl. Ltd. P’ship of Tenn. v. Riese,

Notice of Issuance of Mandate, 99-1497(L) (4th Cir. May 14, 2002). 

7Pursuant to Rule 54(c) of the Federal Rules of Civil Procedure: 

Except as to a party against whom a judgment is entered by

default, every final judgment shall grant the relief to which the

party in whose favor it is rendered is entitled . . . . 

10 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
On September 26, 2002, during a hearing on the Rule 54(c) motion,

the SALT and Stroud Groups maintained that the Riese Group’s

recording of the $900,000 judgment in Wake County was contrary to

the Judgment and our mandate. They noted that, although the Judgment provided that the third-party plaintiffs — the Riese Group and

Gibraltar — shall collectively recover $900,000 from plaintiffs and

third-party defendants, the Riese Group had not recorded the Judgment on behalf of Gibraltar. Counsel for the SALT and Stroud Groups

contended that the $900,000 award made collectively to Riese,

Plichta, and Gibraltar should be allocated among those parties. In

response, the Riese Group maintained that the court was precluded by

the mandate rule from amending the Judgment.8 In addition, the Riese

Group contended that the court lacked authority under Rule 54(c) to

amend the Judgment. 

On October 1, 2002, the district court granted the Rule 54(c)

motion and entered its 2002 judgment (the "Post-Mandate Judgment"). The court therein allocated half of the $900,000 UTPA award

to Gibraltar and half of that award to the Riese Group. The court then

applied the UTPA Net Recovery Approach, offsetting the Riese

Group’s UTPA award against its $450,000 UTPA liability to SALT,

and offsetting Gibraltar’s UTPA award against its $1.1 million liability to SALT. Utilizing the UTPA Net Recovery Approach, the PostMandate Judgment provided for the following:

(1) Judgment against Gibraltar and in favor of plaintiffs in

the amount of $650,000; (2) Judgment against Riese and

Plichta, jointly and severally, in favor of plaintiffs in the

8As the Second Circuit explained in United States v. Ben Zvi, the mandate rule "forecloses relitigation on issues expressly or impliedly decided

by the appellate court." 242 F.3d 89, 95 (2d. Cir. 2001) (internal quotation marks and citations omitted) (emphasis in original). In addition, the

court observed that: 

[W]here an issue was ripe for review at the time of an initial

appeal but was nonetheless foregone, the mandate rule generally

prohibits the district court from reopening the issue on remand

unless the mandate can reasonably be understood as permitting

it to do so. 

Id.

SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 11
amount of $1; and (3) Judgment against Riese, Plichta, and

Gibraltar, jointly and severally, in favor of plaintiffs in the

amount of $28,764.94. 

On October 30, 2002, the Riese Group and Gibraltar filed a notice

of appeal from the Post-Mandate Judgment. They contend on appeal

that entry of the Post-Mandate Judgment contravened the mandate

rule and that the district court lacked authority under Rule 54(c) to

amend the Judgment affirmed in SALT I. We possess jurisdiction

pursuant to 28 U.S.C. § 1291. 

II.

A district court’s interpretation of an appellate court’s mandate is

reviewed de novo. See, e.g., Odetics, Inc. v. Storage Tech. Corp., 185

F.3d 1259, 1275 (Fed. Cir. 1999). We review de novo, therefore,

whether a post-mandate judgment of a district court contravenes the

mandate rule, or whether the mandate has been "scrupulously and

fully carried out." 2A Fed. Proc., L. Ed. § 3:1016 (citing Bd. of Supervisors of Wayne County v. Kennicott, 94 U.S. 498 (1876)). 

III.

In this appeal, we must decide whether the district court’s entry of

the Post-Mandate Judgment violated the mandate rule, which has

been characterized as a "more powerful version" of the law of the

case doctrine. LaShawn v. Barry, 87 F.3d 1389, 1393 & n.3 (D.C. Cir.

1996) (en banc). As we observed in United States v. Bell, 5 F.3d 64,

66 (4th Cir. 1993), "[f]ew legal precepts are as firmly established as

the doctrine that the mandate of a higher court is ‘controlling as to

matters within its compass.’" (citing Sprague v. Ticonic Nat’l Bank,

307 U.S. 161, 168 (1939)). Under the mandate rule, a lower court

generally may not consider questions that the mandate has laid to rest.9

9We have recognized certain limited exceptions to the mandate rule. In

Bell, we observed that, in exceptional circumstances, a trial court may

reopen an issue expressly or impliedly decided by the appellate court. Id.

at 67. Such circumstances include: 

(1) a showing that controlling legal authority has changed dramatically; (2) that significant new evidence, not earlier obtain12 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
Sprague, 307 U.S. at 168. In assessing whether the mandate rule has

been contravened, we must determine whether the district court

addressed a matter within the scope of our mandate. 

In defining the scope of a mandate, we have observed that the mandate rule "forecloses litigation of issues decided by the district court

but foregone on appeal or otherwise waived . . . ." Bell, 5 F.3d at 66.

And we have held that "a district court must, except in rare circumstances, implement both the letter and the spirit of the . . . mandate,

taking into account [our] opinion and the circumstances it embraces."

Id. (internal quotation marks and citations omitted) (alteration in original). We have also held that the mandate rule "forecloses relitigation

of issues expressly or impliedly decided by the appellate court." Id.

(citing United States v. Bell, 988 F.2d 247, 251 (1st Cir. 1993)). The

mandate rule does not simply preclude a district court from doing

what an appellate court has expressly forbidden it from doing. Under

the mandate rule, a district court cannot reconsider issues the parties

failed to raise on appeal; the court must attempt to implement the

spirit of the mandate; and the court may not alter rulings impliedly

made by the appellate court. Id.

The SALT and Stroud Groups maintain that, for two reasons, the

Post-Mandate Judgment did not contravene the mandate rule. First,

they contend that the Post-Mandate Judgment did not alter the Judgment, but rather that it was the Judgment, simply clarified. Second,

the SALT and Stroud Groups maintain that the clarifications in the

Post-Mandate Judgment were consistent with, rather than contrary to,

our mandate in SALT I. In assessing whether the Post-Mandate Judgment contravened the mandate rule, therefore, we must answer the

following inquiries. First, we must decide whether the Post-Mandate

Judgment altered, or merely clarified, the Judgment. Second, if the

Post-Mandate Judgment altered the Judgment, we must determine

able in the exercise of due diligence, has come to light; or (3)

that a blatant error in the prior decision will, if uncorrected,

result in a serious injustice. 

United States v. Aramony, 166 F.3d 655, 662 (4th Cir. 1999) (quoting

Bell, 5 F.3d at 67). The SALT and Stroud Groups make no claim of

exceptional circumstances in this appeal. 

SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 13
whether the alteration was consistent with our mandate. We address

these issues in turn.

A.

The SALT and Stroud Groups maintain that the district court’s

entry of the Post-Mandate Judgment did not contravene the mandate

rule because it merely clarified the Judgment. The Judgment provided

that "third-party plaintiffs [(i.e., Riese, Plichta, and Gibraltar)] collectively shall have and recover of plaintiffs and third-party defendants,

jointly and severally, $900,000.00 for unfair and deceptive trade practices . . . ." The SALT and Stroud Groups accurately contend that,

although the Judgment indicates that the third-party plaintiffs (i.e.,

Riese, Plichta, and Gibraltar) should collectively recover $900,000, it

does not allocate how much of the $900,000 each third-party plaintiff

should receive. This fact does not, however, foreclose the proposition

that the Post-Mandate Judgment impermissibly altered the Judgment.

It cannot be determined, relying solely on the language of the Judgment, how the $900,000 UTPA award should be allocated between

the Riese Group and Gibraltar. The Riese Group maintains that,

because the Verdict provided that the Riese Group (i.e., Riese and

Plichta, not Gibraltar) suffered $300,000 in damages from the SALT

and Stroud Groups’ unfair and deceptive trade practices, the Riese

Group should collect the trebled UTPA award (i.e., $900,000).10 And

the Riese Group contends that its collection of the $900,000 UTPA

award would be consistent with the Judgment because, if it collected

the $900,000, the Riese Group and Gibraltar would collectively, as a

group, receive $900,000. 

10There is support in the Verdict for allocating the entire $900,000

UTPA award to the Riese Group. The amount of a UTPA award is determined by trebling the damages suffered as a result of a UTPA violation.

N.C. Gen. Stat. § 75-16. The issue of how the $900,000 UTPA award

should be allocated, therefore, depends on which party or parties suffered

the $300,000 in damages from the UTPA violations. The third interrogatory of the Verdict asked, "[W]hat amount of damages have the defendants, Riese and Plichta, suffered as a result of [the SALT Group’s or

the Stroud Group’s] unfair and deceptive trade practices." (emphasis

added). The jury answered "$300,000." 

14 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
The SALT and Stroud Groups, on the other hand, maintain that,

because they committed two violations of the UTPA, one that injured

the Riese Group and one that injured Gibraltar, the Riese Group and

Gibraltar should each receive $450,000 of the UTPA award. Under

such an allocation, the Riese Group and Gibraltar also would collectively receive $900,000, consistent with the Judgment. 

In fact, the Riese Group and Gibraltar could, consistent with the

Judgment, collectively receive the $900,000 UTPA award under a

multitude of scenarios other than those advocated by the parties. So

long as the sum collected by the Riese Group and Gibraltar totalled

$900,000, the aspect of the Judgment directing that Riese, Plichta, and

Gibraltar collectively receive the $900,000 UTPA award would be

satisfied. Under the Post-Mandate Judgment, on the other hand, only

a single allocation scenario is permissible. We agree with the SALT

and Stroud Groups that the allocation scenario specified in the PostMandate Judgment was a possible allocation scenario under the Judgment. We disagree, however, with their contention that, because the

allocation scenario of the Post-Mandate Judgment was possible under

the Judgment, the Post-Mandate Judgment did not alter the Judgment.

The Judgment did not preclude Riese and Plichta, without Gibraltar,

from collecting the $900,000 UTPA award. The Post-Mandate Judgment, however, prohibits them from so doing. In specifying how the

$900,000 UTPA award should be allocated between the Riese Group

and Gibraltar, the Post-Mandate Judgment foreclosed all possible

allocation scenarios save one. It thereby altered the Judgment.

B.

The SALT and Stroud Groups contend that, even if entry of the

Post-Mandate Judgment altered the Judgment, its entry did not contravene the mandate rule because the Post-Mandate Judgment is consistent with, rather than contrary to, our SALT I mandate. We disagree.

As we held in Bell, the mandate rule not only precludes a lower court

from doing what the mandate expressly forbids, the rule also "forecloses litigation of issues decided by the district court but foregone on

appeal or otherwise waived . . . ." 5 F.3d at 66. Even if the allocation

and setoff scenario specified in the Post-Mandate Judgment did not

conflict with any specific aspect of SALT I,11 it contravened the man11The allocation and setoff scenario provided for in the Post-Mandate

Judgment appears to conflict with the statement in SALT I that "the disSOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 15
date if its entry required the litigation of an issue the SALT and

Stroud Groups failed to raise and pursue in the SALT I appeal. Here,

the Post-Mandate Judgment contravened the SALT I mandate because

entry of that judgment required the litigation of such an issue. 

In the Rejection Order, the district court observed that the only net

recovery possible under the Judgment would be that provided for

under the UTPA Net Recovery Approach. The SALT and Stroud

Groups rely on this provision of the Rejection Order to support their

position that the court did not contravene the mandate rule in the PostMandate Judgment because, in entering that judgment, it merely

incorporated the UTPA Net Recovery Approach into the Judgment —

an action the court had determined, prior to our SALT I mandate, to

be proper. This contention, however, cuts against the position of the

SALT and Stroud Groups. The district court’s authority to enter a new

judgment on July 2, 1999, implementing the UTPA Net Recovery

Approach, has no bearing on whether the court continued to possess

such authority following the issuance of our mandate. The Rejection

Order is significant, however, in that, after it was entered, the SALT

and Stroud Groups were on notice that the UTPA Net Recovery

Approach was the only form of net recovery permissible under the

Judgment. 

The Rejection Order did not require incorporation of the UTPA Net

Recovery Approach into the Judgment and, after entering the Rejection Order, the court did not amend the Judgment to reflect such an

incorporation. When the SALT and Stroud Groups appealed the

Rejection Order, therefore, it was clear that, although the UTPA Net

Recovery Approach could have been incorporated into the Judgment,

the Judgment could also be properly executed without utilizing that

approach. During SALT I, however, the SALT and Stroud Groups

failed to contend that the Judgment should incorporate any net recovery approach — no issues of allocation or setoff under the Judgment

were raised in SALT I.

The SALT and Stroud Groups maintain that, because issues regarding the proper allocation or setoff of the UTPA awards under the

trict court’s award of treble damages to the Riese Group, in the aggregate

sum of $900,000 . . . must be upheld." SALT I at 540 (emphasis added).

16 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE
Judgment were not reasonably foreseeable, they were not required to

raise them in their SALT I appeal. More specifically, the SALT and

Stroud Groups contend that they did not waive these issues because

they could not have reasonably foreseen that, under the Judgment,

Riese and Plichta alone would record the entire $900,000 judgment.

They maintain that their inability to foresee that the Judgment would

not be recorded on Gibraltar’s behalf was reasonable in light of the

court’s observation in the Rejection Order that implementation of the

UTPA Net Recovery Approach would be proper under the Judgment.

The record is to the contrary, however. Not only were the allocation

and setoff issues reasonably foreseeable, the SALT and Stroud

Groups actually foresaw the possibility that Riese and Plichta alone,

without Gibraltar, would record the $900,000 UTPA award. 

On July 14, 1999, twelve days after the district court entered its

Rejection Order, the SALT and Stroud Groups noticed their appeal of

that order. In their docketing statement on appeal, they asserted that

they would raise the issue of how the Judgment should be applied for

purposes of execution. In so doing, they then recognized that the

Judgment did not specify how the $900,000 UTPA award should be

allocated among Riese, Plichta, and Gibraltar. Furthermore, in specifying the allocation issue in their docketing statement, they acknowledged that the issue was not resolved to their satisfaction by the

Rejection Order. The SALT and Stroud Groups recognized that Riese

and Plichta were not precluded from recording the $900,000 judgment

without Gibraltar, and yet they failed to pursue the allocation issue on

appeal. And after we issued our mandate in SALT I, they returned to

the district court to relitigate this very issue. 

In addition to the docketing statement’s declaration that the allocation issue had not yet been resolved, the record indicates that the

SALT and Stroud Groups understood the practical implications of the

Judgment — that Riese and Plichta stood to net approximately

$450,000 (i.e., that Riese and Plichta’s total liabilities were $450,001,

excluding costs and interest, and that they would collect the entire

$900,000 UTPA award, leaving them with a net recovery of approximately $450,000). In their brief in SALT I, for example, the SALT

and Stroud Groups asserted that "[t]he judgment awarded Riese and

Plichta $900,000 against Stroud for unfair and deceptive trade practices" (emphasis added), and noted that "[t]he jury found Riese and

SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE 17
Plichta suffered damages in the amount of $300,000 as a result of the

plaintiffs’ acts and practices (which the District Court trebled to

$900,000)." Appellants’ Brief at 4, 18 (emphasis added). 

Finally, the SALT and Stroud Groups acknowledged at oral argument and in their Petition that they understood how the Judgment

might be executed. During oral argument, their counsel observed that

the result of the Judgment "may well be that, instead of money flowing into the partnership . . ., the result is going to be money flowing

— $900,000 in fact — flowing back to Mr. Riese and Mr. Plichta

. . . ." And in their Petition, they acknowledged that "the jury awarded

. . . $300,000 to the Riese Group," and they observed that the result

of the UTPA determination in SALT I "is that the Riese Group stands

to recover from the Stroud Group $450,000, plus interest." 

In sum, the record reflects that the SALT and Stroud Groups knew

that Riese and Plichta were not precluded from recording and executing the $900,000 judgment. More importantly, the record reflects their

recognition that, under our mandate, Riese and Plichta were permitted to record and execute the $900,000 judgment. They understood,

therefore, that in seeking the Post-Mandate Judgment, they sought to

preclude Riese and Plichta from recording and executing the Judgment in a manner authorized by SALT I. Recognizing what might

come to pass under the Judgment, however, the SALT and Stroud

Groups failed to pursue the allocation and setoff issue on appeal.

They were foreclosed by the mandate rule, therefore, from resurrecting this issue in the district court.12

IV.

Pursuant to the foregoing, we vacate the Post-Mandate Judgment

and remand for reentry of the Judgment.

VACATED AND REMANDED

12The Riese Group and Gibraltar also maintain that the district court

lacked the authority, pursuant to Rule 54(c), to enter an amended judgment three years after it entered the Judgment and after that Judgment

had been affirmed by this Court. Because the Post-Mandate Judgment

violated the mandate rule, we need not address the issue of whether,

absent the mandate rule, the district court could, pursuant to Rule 54(c),

enter the Post-Mandate Judgment. 

18 SOUTH ATLANTIC LIMITED PARTNERSHIP v. RIESE