UNITED STATES COURT OF APPEALS

Tenth Circuit

Byron White United States Courthouse

1823 Stout Street

Denver, Colorado 80294

(303) 844-3157

Patrick J. Fisher, Jr. Elisabeth A. Shumaker

Clerk Chief Deputy Clerk

March 14, 2000

TO: ALL RECIPIENTS OF THE OPINION

RE: 98-8091, McIlravy v. Kerr-McGee Coal Corp.

Filed on February 28, 2000

On page one of the court’s slip opinion, the section listing the attorneys for the

appellant is corrected to read as follows:

Gregory A. Eurich, Holland & Hart, Denver, Colorado (with Marcy G.

Glenn and Megan C. Bertron of Holland & Hart and Carolyn Gregg Hill

of Andrews Davis Legg Bixler Milsten & Price, Oklahoma City,

Oklahoma with him on the briefs) for Defendant - Appellant.

A corrected copy of page one is attached.

Sincerely,

Patrick Fisher, Clerk of Court

By: Keith Nelson

Deputy Clerk

encl.
F I L E D

United States Court of Appeals

Tenth Circuit

FEB 28 2000

PATRICK FISHER

Clerk

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

LEROY MCILRAVY; ALLEN LEE

MAHONEY; RICHARD E.

MASSMAN; ROBERT H. GRAY,

Plaintiffs - Appellees,

v.

KERR-MCGEE COAL

CORPORATION, a Delaware

corporation,

Defendant - Appellant.

No. 98-8091

Appeal from the United States District Court

for the District of Wyoming

(D.C. No. 93-CV-302)

Gregory A. Eurich, Holland & Hart, Denver, Colorado (with Marcy G. Glenn and

Megan C. Bertron of Holland & Hart and Carolyn Gregg Hill of Andrews Davis

Legg Bixler Milsten & Price, Oklahoma City, Oklahoma with him on the briefs)

for Defendant - Appellant.

Stephen H. Kline, Kline & Jenkins, Cheyenne, Wyoming (with Kenneth E.

Barker, Quinn, Eiesland, Day & Barker, Belle Fourche, South Dakota with him on

the brief) for Plaintiffs - Appellees.

Before TACHA, KELLY and LUCERO, Circuit Judges.

LUCERO, Circuit Judge.
- 2 -

This diversity case has been through two jury trials and is again before us

on appeal. Some two years ago, this court considered the case and reversed the

trial court’s grant of partial summary judgment as to the plaintiffs’ breach of

contract claim. At a subsequent trial, judgment was entered for the plaintiffs, and

the defendant, Kerr-McGee Coal Corporation (“KMC”), now appeals from the

jury verdict awarding damages for breach of employment contract. We must

determine whether the law of the case doctrine bars consideration of appellant’s

claimed error as having been decided implicitly in the previous appeal. 

Exercising jurisdiction pursuant to 28 U.S.C. § 1291, we conclude that the

doctrine of law of the case bars consideration of the merits of KMC’s claims and

affirm.

I

In 1992, KMC fired appellees Leroy McIlravy, Allen Lee Mahoney,

Richard E. Massman, and Robert H. Gray, all salaried, supervisory employees, as

part of a reduction in force (“RIF”). It allegedly did so without considering

appellees’ seniority at the company and without cause, in violation of the

following RIF provision in KMC’s 1976 and 1977 employee handbooks:

REDUCTIONS IN FORCE
- 3 -

If a job is eliminated or an operation reduced, the determination of

the employee or employees to be demoted or laid off will be made on the

basis of qualifications and seniority.

A. Demotions

Demotions in a progression line required by reduction of force will

generally be made in the reverse of the normal order of promotion. An

employee demoted to a lower classification will carry back all earned

classification seniority. Employees will, on the basis of qualifications and

Classification Seniority, successively demote downward through the

classifications of the affected progression line. An employee who is

displaced from a progression line by this demotion procedure may only

displace an employee with less Company Seniority who occupies either

another entry level classification in a progression line or the lowest related

non-progressional classification (s), provided the employee has the

qualifications to perform the work of such classification.

B. Layoffs

Layoffs will be made from the entry level classification in

progression lines or from non-progressional classifications. An employee

subject to being laid off from the higher rated non-progressional

classification (s) may only displace an employee with less Company

Seniority who occupies either an entry level job in a progression line or the

lowest rated non-progressional classification (s), provided the employee has

the qualifications to perform the work of such classification.

(III R. at 967-68.)

In 1993, appellees filed suit against KMC in United States District Court

for the District of Wyoming, alleging breach of contract, breach of the implied

covenant of good faith and fair dealing, and promissory estoppel arising from the

RIF. The district court granted summary judgment to KMC on all claims save the

claim of promissory estoppel, the parties tried that claim, and a jury found for
- 4 -

KMC. On appeal, this court affirmed the jury verdict and the grant of summary

judgment on appellees’ claim of breach of the implied covenant of good faith and

fair dealing, but reversed the grant of summary judgment on the breach of

contract claim, finding there was a genuine issue of material fact as to whether

KMC breached an employment contract with appellees. See McIlravy v. KerrMcGee Corp., 119 F.3d 876 (10th Cir. 1997) (“McIlravy I”).

Specifically, McIlravy I held, inter alia, that the foregoing RIF provision

indicates that [KMC] would take seniority into account in selecting

employees for layoffs . . . [I]t can also reasonably be construed as

representing that the company would make layoffs in order of seniority, if

the conditions above were met. Plaintiffs contend that the company’s

selection of them for termination breached these representations. They

have cited evidence that the company went strictly by performance rankings

when it selected them for termination and that it gave no consideration at

all to seniority. Under the circumstances, we agree with appellants that

genuine issues of material fact exist as to whether [KMC] performed

according to the representations in the handbook. Accordingly, the

summary judgment in favor of defendant on the breach of contract claim

must be reversed and remanded to the district court for further proceedings

consistent with this opinion.

Id. at 881-82 (citation omitted).

On remand, a second jury rendered its verdict against KMC, awarding

appellees total damages of $2,371,028 for breach of contract. KMC thereupon

filed a motion for judgment as a matter of law, alleging that the RIF provision did

not apply to salaried, supervisory employees and, even if it did, the RIF provision
1

 We note that the law of the case doctrine, not issue preclusion, is

applicable to this case. 

The doctrine of law of the case is similar to the issue preclusion prong of

res judicata in that it limits relitigation of an issue once it has been decided. 

However, law of the case is concerned with the extent to which law applied

in a decision at one stage of litigation becomes the governing principle in

later stages of the same litigation. Res judicata does not speak to direct

attacks in the same case, but rather has application in subsequent actions. 

Rezzonico v. H & R Block, Inc., 182 F.3d 144, 148 (2d Cir. 1999).

- 5 -

was inapplicable and unenforceable under the circumstances of the present case. 

The district court denied KMC’s motion, which led to this appeal.

II

Before reaching the merits of KMC’s claims of error, we must decide

whether to bar them under the doctrine of law of the case.1 “[T]he law of the case

‘doctrine posits that when a court decides upon a rule of law, that decision should

continue to govern the same issues in subsequent stages in the same case.’”

United States v. Monsisvais, 946 F.2d 114, 115 (10th Cir. 1991) (quoting Arizona

v. California, 460 U.S. 605, 618 (1983)). “[W]hen a case is appealed and

remanded, the decision of the appellate court establishes the law of the case and

ordinarily will be followed by both the trial court on remand and the appellate

court in any subsequent appeal.” Rohrbaugh v. Celotex Corp., 53 F.3d 1181,

1183 (10th Cir. 1995). 
- 6 -

The enunciated rationales for the law of the case doctrine are compelling: 

The doctrine is “based on sound public policy that litigation should come to an

end and is designed to bring about a quick resolution of disputes by preventing

continued re-argument of issues already decided,” Gage v. General Motors Corp.,

796 F.2d 345, 349 (10th Cir. 1986) (citations omitted), so avoiding both a

wasteful expenditure of resources by courts and litigating parties and the gradual

undermining of public confidence in the judiciary—in short, Dickens’s Jarndyce

v. Jarndyce syndrome. The promotion of judicial economy—a primary concern

underlying the law of the case doctrine—requires that litigants be encouraged to

present all available claims and defenses at the earliest opportunity. See id. (“The

law of the case doctrine is a restriction self-imposed by the courts in the interests

of judicial efficiency.”) (citations omitted). The doctrine “also serves the

purposes of discouraging panel shopping at the court of appeals level.” 

Monsisvais, 946 F.2d at 116 (citing Heathcoat v. Potts, 905 F.2d 1161, 1164 (11th

Cir. 1990)). 

The doctrine is, however, “only a rule of practice in the courts and not a

limit on their power.” Id. (citing Messinger v. Anderson, 225 U.S. 436, 444

(1912)). We have recognized three “exceptionally narrow” grounds for departure

from that rule of practice: “(1) when the evidence in a subsequent trial is

substantially different; (2) when controlling authority has subsequently made a
- 7 -

contrary decision of the law applicable to such issues; or (3) when the decision

was clearly erroneous and would work a manifest injustice.” United States v.

Alvarez, 142 F.3d 1243, 1247 (10th Cir.), cert. denied, 119 S. Ct. 242 (1998)

(citing Monsisvais, 946 F.2d at 117). 

A

As noted, this court has considered once before appellees’ ability to enforce

the RIF provision of the handbooks in an appeal at the summary judgment stage

of this litigation. See McIlravy I, 119 F.3d at 878-82. With regard to KMC’s

claim that the terms of the provision were “too vague and indefinite to permit

enforcement,” (Appellant’s Br. at 39), in McIlravy I the panel summarized the

appellants’ claim as follows: “they contend the handbooks promised that any

layoffs would be made in order of seniority. [They] argue that [KMC] breached

[that] promise[].” Id. at 879. In response to that argument, the panel specifically

held the RIF provision “indicates that [KMC] would take seniority into account in

selecting employees for layoffs. . . . [I]t can also reasonably be construed as

representing that the company would make layoffs in order of seniority, if the

conditions above were met. . . . Under the circumstances, we agree with

appellants that genuine issues of material fact exist as to whether [KMC]

performed according to the representations in the handbook.” Id. at 881-82. 

McIlravy I therefore expressly indicated that the “seniority” language of the RIF
2

 For example, the district court, on the first page of its order granting in

part and denying in part KMC’s motion for summary judgment, stated that

McIlravy and his colleagues “worked their way up the employment ladder to

supervisory positions which they held until they were terminated.” McIlravy v.

Kerr-McGee Coal Corp., No. 93-CV-0302-B (D. Wyo. June 22, 1994) (emphasis

added). McIlravy I also stated that “[p]laintiffs were at the bottom of the

rankings for supervisors in their respective departments. The company retained

some supervisors who had less seniority than the plaintiffs but who had better

performance rankings.” McIlravy I, 119 F.3d at 879 (emphasis added). 

- 8 -

provision was not unenforceably vague as a matter of law. Barring one of the

“exceptionally narrow” grounds for departure from the law of the case doctrine,

discussed below, we will not revisit that decision.

KMC’s claim that the RIF provision does not apply to salaried, supervisory

employees like appellees is less straight-forward. In this court’s earlier decision,

that issue was implicitly rather than explicitly decided. In addition to finding

there was a genuine issue of material fact as to whether KMC had breached a

contract with plaintiffs based on the RIF provision, McIlravy I held that “[t]aken

as a whole, the . . . handbooks are sufficiently ambiguous that they could be said

to have reasonably created expectations on plaintiffs’ part that the company had

promised not to discharge employees absent cause for the dismissal.” Id. at 880. 

The foregoing language indicates that, at that time, the panel found the RIF

provision applicable to plaintiffs, whose status as salaried, supervisory employees

was a matter of record in the first appeal.2 Thus, in McIlravy I, with the

knowledge that plaintiffs were supervisory employees, this court decided that
3

 Our application of the law of the case doctrine to implicitly decided

issues is consistent with the law of our sister circuits. See, e.g., Kansas Pub.

Employees Retirement Sys. v. Blackwell, Sanders, Matheny, Weary & Lombardi,

L.C., 114 F.3d 679, 687 (8th Cir. 1997); Alberti v. Klevenhagen, 46 F.3d 1347,

(continued...)

- 9 -

plaintiffs presented a genuine issue of material fact as to whether KMC breached

the terms of the employment contract as set forth in the RIF provision.

Under the law of the case doctrine, there are several circumstances under

which an issue may be implicitly resolved by a prior appeal: “(1) resolution of the

issue was a necessary step in resolving the earlier appeal; (2) resolution of the

issue would abrogate the prior decision and so must have been considered in the

prior appeal; and (3) the issue is so closely related to the earlier appeal its

resolution involves no additional consideration and so might have been resolved

but unstated.” Guidry v. Sheet Metal Workers Int’l Ass’n, Local No. 9, 10 F.3d

700, 707 (10th Cir. 1993), modified on other grounds sub nom. Guidry v. Sheet

Metal Workers Nat’l Pension Fund, 39 F.3d 1078 (10th Cir. 1994) (en banc). We

explained in Guidry that “there is little guidance in the law to explain the

circumstances under which an issue may be implicitly resolved. The recited

factors are not intended to be exhaustive.” Id. at 707 n.5; see also Rishell v. Jane

Phillips Episcopal Mem’l Med. Ctr., 94 F.3d 1407, 1410 (10th Cir. 1996) (“[L]aw

of the case applies to issues that are resolved implicitly as well as to those

decided explicitly.”).3
3

(...continued)

1351 n.1 (5th Cir. 1995); Griffin v. Michigan Dep’t of Corrections, 5 F.3d 186,

190 (6th Cir. 1993); Day v. Moscow, 955 F.2d 807, 812 (2d Cir. 1992); Exxon

Corp. v. United States, 931 F.2d 874, 877 (Fed. Cir. 1991); Key v. Sullivan, 925

F.2d 1056, 1060 (7th Cir. 1991); Wheeler v. City of Pleasant Grove, 746 F.2d

1437, 1440 (11th Cir. 1984); Liberty Mutual Ins. Co. v. EEOC, 691 F.2d 438, 441

(9th Cir. 1982); Walston v. School Bd. of Suffolk, 566 F.2d 1201, 1205 (4th Cir.

1977).

- 10 -

Applying Guidry’s analysis to the present case, a determination as to the

applicability of the RIF provision to appellees was “a necessary step” in the

earlier panel’s decision, Guidry, 10 F.3d at 707, because there would be no

genuine issue of material fact as to whether KMC breached that contract term if

appellees were not party to the contract. Similarly, resolving the RIF applicability

issue as barring the breach of contract claim “would abrogate the prior decision

and so must have been considered in the prior appeal,” id., because deciding

appellees were not party to the contract would have caused the earlier panel to

affirm rather than reverse the grant of summary judgment to KMC.

In Martinez v. Roscoe, 100 F.3d 121 (10th Cir. 1996), we faced a

procedural history analogous to that of the present appeal. In Martinez, the

appellants challenged the issuance by the district court of a second permanent

injunction, based on their violation of a prior permanent injunction, against

“interfering with the management” of apartments owned by the appellants. Id. at

122. Their appeal challenged the issuance of the subsequent permanent injunction
- 11 -

on two grounds. See id. at 122-23. The appellants had raised, and the district

court had rejected, the first ground during the first injunction proceeding. See id.

The Martinez court held that the district court’s earlier decision had not been

“challenged by appeal, [and] [a]ccordingly, [the appellants] are barred by the

doctrine of law of the case from raising the issue in this appeal.” Id. at 123. The

appellants had not previously raised their second ground, namely, that the

appellees had no right to bring the cause of action that culminated in the issuance

of the permanent injunctions. See id. Nevertheless, the Martinez court held that 

[t]he district court’s determination that plaintiffs were entitled to maintain

this action was integral to the [issuance of the first] permanent injunction. 

[The appellants] did not appeal that order. Accordingly, [they] now are

barred by the doctrine[] of . . . law of the case from challenging

[appellees’] ability to maintain this action. The district court’s

[subsequent] permanent injunction is, therefore, affirmed.

Id. (citations omitted). The Martinez court thus refused, on the basis of the law

of the case doctrine, to examine the merits of the questions, one explicitly and one

implicitly, decided at a prior stage of the litigation.

Similarly, in the present case a prior panel of this court expressly settled

the enforceability of the RIF provision in McIlravy I. The applicability of the RIF

provision—a determination that the provision applied to plaintiffs as salaried,

supervisory employees—was implicit in and “integral to” McIlravy I’s explicit

holding. Id. Under our precedent in Martinez, we apply the law of the case

doctrine to bar KMC’s claims.
4

 Appellants cite the Wyoming Supreme Court’s recent decision in

Bouwens v. Centrilift, 974 P.2d 941, 944 (Wyo. 1999), for the proposition that

“an employer’s course-of-dealing and handbook provisions which relate to

disciplinary actions and procedures are irrelevant to an analysis of a layoff

termination.” Id. (citing Rompf v. John Q. Hammons Hotels, Inc., 685 P.2d 25,

29 (Wyo. 1984)). However, the Bouwens court indicated that the Rompf holding

was confined to cases in which a handbook “did not contain a layoff provision.” 

Id. In the present case, there was indeed a layoff provision in the handbooks’ RIF

section.

- 12 -

B

We next ask whether KMC meets any of the three “exceptionally narrow”

grounds for departure from the law of the case doctrine. Alvarez, 142 F.3d at

1247 (citing Monsisvais, 946 F.2d at 117). First, we are not confronted with

substantially different evidence than that on record in McIlravy I: KMC’s claims

in both appeals arise out of the same contractual language, and plaintiffs’ status

as salaried, supervisory employees was on the record. See id. Second, the

controlling law in this case has not changed.4 See id. Finally, we are not

persuaded that the terms of the two handbooks are so unequivocal that

enforcement of the interpretation given the handbooks by the jury would be

“clearly erroneous and work a manifest injustice” to the parties. Id.
- 13 -

III

KMC also claims that the district court should have granted its motion for

judgment as a matter of law because the handbooks do not include procedures for

final terminations during RIFs, but only for temporary “layoffs,” and appellees

here were permanently “terminated” rather than “laid off.”

“We review de novo the district court’s denial of a litigant’s motion for

judgment as a matter of law filed pursuant to Fed. R. Civ. P. 50(b). We will

reverse such a ruling only if the evidence points but one way and is susceptible to

no reasonable inferences supporting the party opposing the motion.” Kinser v.

Gehl Co. , 184 F.3d 1259, 1267 (10th Cir. 1999), cert. denied , No. 99-1608, 2000

WL 48811 (Jan. 24, 1999) (citation and quotation omitted). 

In construing the parties’ contractual intent under Wyoming law, courts are

required to give contractual terms their plain and ordinary meaning. See Lines

Ins. Co. v. Wyoming Coal Refining Sys., Inc. , 52 F.3d 901, 903 (10th Cir. 1995). 

In the present case, an inquiry into the plain meaning of the term “layoff” reveals

that that term can denote either a permanent or a temporary termination of

employment. The term is variously defined as “[a] termination of employment at

the will of employer. Such may be temporary . . . or permanent,” Black’s Law

Dictionary 888 (6th ed. 1990), and “the act of laying off an employee or
- 14 -

workforce,” to wit, “to cease to employ (a worker) usu[ally] temporarily,” 

Webster’s Ninth New Collegiate Dictionary 679 (1991). 

Because the term “layoff” may denote either a permanent or temporary

termination of employment, that term is ambiguous in the present case. We

cannot say here that “the evidence points but one way and is susceptible to no

reasonable inferences supporting” appellees’ position. Kinser , 184 F.2d at 1267;

cf. Emulsified Asphalt, Inc. v. Transportation Comm’n , 970 P.2d 858, 864 (Wyo.

1998) (citing Mountain View/Evergreen Improvement and Serv. Dist. v. Casper

Concrete Co. , 912 P.2d 529, 532 (Wyo.1996)) (“Ambiguous contracts are

construed against the drafter.”); Goodman v. Kelly , 390 P.2d 244, 247 (Wyo.

1964) (“[I]n case of doubt as to the meaning of an instrument, the doubt will be

resolved against the scrivener . . . .”). We agree with the district court that it was

appropriate to submit the breach of contract claim to the jury.

IV

The judgment of the district court is AFFIRMED.