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 sectio n 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, Oklah oma City, Oklahoma with him on the briefs) for Defendant - Ap pellant. 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 Greg g Hill of Andrews Davis Legg Bixler Milsten & Price, Oklahoma City, Oklahom a with him on the briefs) for Defendant - Appellant. Stephen H. Kline, Kline & Jenkins, Cheyenne, Wyomin g (with Kenneth E. Barker, Quinn, Eiesland, Day & Barker, Belle Fourch e, 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 trial s and is again before us on appeal. Some two years ago, this court consider ed 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 wa s entered for the plaintiffs, and the defendant, Kerr-McGee Coal Corporation (“KMC”), now appeals from the jury verdict awarding damages for breach of employm ent 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. § 129 1, 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 salarie d, supervisory employees, as part of a reduction in force (“RIF”). It allegedly did so without considering appellees’ seniority at the company and without cau se, in violation of the following RIF provision in KMC’s 1976 and 1977 empl oyee 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 reducti on of force will generally be made in the reverse of the normal orde r of promotion. An employee demoted to a lower classification will car ry back all earned classification seniority. Employees will, on the b asis of qualifications and Classification Seniority, successively demote downw ard 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 wh o occupies either another entry level classification in a progressionline or the lowest related non-progressional classification (s), provided the employee has the qualifications to perform the work of such classifi cation. B. Layoffs Layoffs will be made from the entry level classific ation in progression lines or from non-progressional classif ications. An employee subject to being laid off from the higher rated non -progressional classification (s) may only displace an employee wi th less Company Seniority who occupies either an entry level job ina progression line or the lowest rated non-progressional classification (s), provided the employee has the qualifications to perform the work of such clas sification. (III R. at 967-68.) In 1993, appellees filed suit against KMC in UnitedStates District Court for the District of Wyoming, alleging breach of con tract, breach of the implied covenant of good faith and fair dealing, and promis sory estoppel arising from the RIF. The district court granted summary judgment t o 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 verdi ct and the grant of summary judgment on appellees’ claim of breach of the impli ed covenant of good faith and fair dealing, but reversed the grant of summary jud gment on the breach of contract claim, finding there was a genuine issue o f 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 acco unt in selecting employees for layoffs . . . [I]t can also reasonabl y be construed as representing that the company would make layoffs inorder of seniority, if the conditions above were met. Plaintiffs contend that the company’s selection of them for termination breached these re presentations. They have cited evidence that the company went strictly by performance rankings when it selected them for termination and that it g ave no consideration at all to seniority. Under the circumstances, we agre e 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 breac h of contract claim must be reversed and remanded to the district courtfor further proceedings consistent with this opinion. Id. at 881-82 (citation omitted). On remand, a second jury rendered its verdict again st 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, all eging that the RIF provision did not apply to salaried, supervisory employees and, e ven if it did, the RIF provision1 We note that the law of the case doctrine, not is sue preclusion, is

applicable to this case. The doctrine of law of the case is similar to the i ssue preclusion prong of res judicata in that it limits relitigation of an i ssue once it has been decided. However, law of the case is concerned with the exte nt to which law applied in a decision at one stage of litigation becomes th e governing principle in later stages of the same litigation. Res judicata does not speak to direct attacks in the same case, but rather has applicatio n in subsequent actions. Rezzonico v. H & R Block, Inc. , 182 F.3d 144, 148 (2d Cir. 1999). - 5 - was inapplicable and unenforceable under the circum stances of the present case. The district court denied KMC’s motion, which led t o 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 th e 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 st ages in the same case.’” United States v. Monsisvais , 946 F.2d 114, 115 (10th Cir. 1991) (quoting Arizo na v. California , 460 U.S. 605, 618 (1983)). “[W]hen a case is app ealed and remanded, the decision of the appellate court estab lishes the law of the case and ordinarily will be followed by both the trial courton remand and the appellate court in any subsequent appeal.” Rohrbaugh v. Celo tex Corp. , 53 F.3d 1181, 1183 (10th Cir. 1995).- 6 -

The enunciated rationales for the law of the case d octrine 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 resoluti on 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 omitt ed), so avoiding both a wasteful expenditure of resources by courts and lit igating parties and the gradual undermining of public confidence in the judiciary—i n short, Dickens’s Jarndyce v. Jarndyce syndrome. The promotion of judicial economy—a pri mary concern underlying the law of the case doctrine—requires th at litigants be encouraged to present all available claims and defenses at the ea rliest opportunity. See id. (“The law of the case doctrine is a restriction self-impo sed 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 n arrow” grounds for departure from that rule of practice: “(1) when the evidence in a subsequent trial is substantially different; (2) when controlling autho rity has subsequently made a- 7 -

contrary decision of the law applicable to such iss ues; or (3) when the decision was clearly erroneous and would work a manifest inj ustice.” 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 app ellees’ 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 vag ue and indefinite to permit enforcement,” (Appellant’s Br. at 39), in McIlravy I the panel summarized the appellants’ claim as follows: “they contend the han dbooks 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 s pecifically held the RIF provision “indicates that [KMC] would take seniority into account in selecting employees for layoffs. . . . [I]t can al so reasonably be construed as representing that the company would make layoffs inorder of seniority, if the conditions above were met. . . . Under the circums tances, we agree with appellants that genuine issues of material fact exi st as to whether [KMC] performed according to the representations in the h andbook.” Id. at 881-82. McIlravy I therefore expressly indicated that the “seniority” language of the RIF2 For example, the district court, on the first pag e of its order granting in

part and denying in part KMC’s motion for summary j udgment, stated that McIlravy and his colleagues “worked their way up th e employment ladder to supervisory positions which they held until they were terminated.” McIl ravy v. Kerr-McGee Coal Corp. , No. 93-CV-0302-B (D. Wyo. June 22, 1994) (emphasi s added). McIlravy I also stated that “[p]laintiffs were at the bottom of the rankings for supervisors in their respective departments. The company reta ined 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 o f 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 t o salaried, supervisory employees like appellees is less straight-forward. In this court’s earlier decision, that issue was implicitly rather than explicitly de cided. In addition to finding there was a genuine issue of material fact as to wh ether 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 am biguous that they could be said to have reasonably created expectations on plaintif fs’ part that the company had promised not to discharge employees absent cause fo r 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 employee s, this court decided that3 Our application of the law of the case doctrine t o implicitly decided

issues is consistent with the law of our sister cir cuits. 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. Kle venhagen , 46 F.3d 1347, (continued...) - 9 - plaintiffs presented a genuine issue of material fa ct as to whether KMC breached the terms of the employment contract as set forth i n the RIF provision. Under the law of the case doctrine, there are sever al circumstances under which an issue may be implicitly resolved by a prio r appeal: “(1) resolution of the issue was a necessary step in resolving the earlierappeal; (2) resolution of the issue would abrogate the prior decision and so musthave been considered in the prior appeal; and (3) the issue is so closely relat ed to the earlier appeal its resolution involves no additional consideration andso 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 ground s sub nom. Guidry v. Sheet Metal Workers Nat’l Pension Fund , 39 F.3d 1078 (10th Cir. 1994) (en banc). We explained in Guidrythat “there is little guidance in the law to expla in the circumstances under which an issue may be implicitl y 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 imp licitly as well as to those decided explicitly.”). 33 (...continued)

1351 n.1 (5th Cir. 1995); Griffin v. Michigan Dep’tof 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. Sulliv an , 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 br eached that contract term if appellees were not party to the contract. Similarl y, resolving the RIF applicability issue as barring the breach of contract claim “woul d abrogate the prior decision and so must have been considered in the prior appea l,” 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 jud gment to KMC. In Martinez v. Roscoe , 100 F.3d 121 (10th Cir. 1996), we faced a procedural history analogous to that of the presentappeal. 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 own ed by the appellants. Id. at 122. Their appeal challenged the issuance of the s ubsequent permanent injunction- 11 -

on two grounds. See id. at 122-23. The appellants had raised, and the dis trict court had rejected, the first ground during the fir st injunction proceeding. See id. The Martinez court held that the district court’s earlier decis ion had not been “challenged by appeal, [and] [a]ccordingly, [the ap pellants] 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 g round, 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 plaintiff s were entitled to maintain this action was integral to the [issuance of the fi rst] permanent injunction. [The appellants] did not appeal that order. Accord ingly, [they] now are barred by the doctrine[] of . . . law of the case f rom challenging [appellees’] ability to maintain this action. The district court’s [subsequent] permanent injunction is, therefore, af firmed. 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 litigat ion. Similarly, in the present case a prior panel of thi s court expressly settled the enforceabilityof the RIF provision in McIlravy I . The applicabilityof the RIF provision—a determination that the provision applie d 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 propositio n that “an employer’s course-of-dealing and handbook provi sions 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 pr ovision in the handbooks’ RIF section. - 12 - B We next ask whether KMC meets any of the three “exc eptionally 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 w ith substantially different evidence than that on recor d in McIlravy I : KMC’s claims in both appeals arise out of the same contractual l anguage, and plaintiffs’ status as salaried, supervisory employees was on the recor d. 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 s o unequivocal that enforcement of the interpretation given the handboo ks by the jury would be “clearly erroneous and work a manifest injustice” t o 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 d o not include procedures for final terminations during RIFs, but only for tempor ary “layoffs,” and appellees here were permanently “terminated” rather than “lai d off.” “We review de novo the district court’s denial of alitigant’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 b ut 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 om itted). In construing the parties’ contractual intent underWyoming 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 mean ing of the term “layoff” reveals that that term can denote either a permanent or a t emporary 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 i n the present case. We cannot say here that “the evidence points but one w ay 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 contrac ts 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.