Opinion ID: 148187
Heading Depth: 1
Heading Rank: 13

Heading: The Accrual Date of the Post-Judgment Interest on the Prejudgment Interest

Text: The final issue we address concerns the date on which post-judgment interest on the prejudgment interest began to run. [38] Travelers contends that post-judgment interest on the prejudgment interest began to accrue on August 14, 2006, when, following its Phase II ruling, the District Court entered judgment in favor of Travelers in the amount of $8,226,817 on its underlying reinsurance coverage claim. The District Court held that the relevant date was December 5, 2007, when, following its resolution of the rate-of-prejudgment-interest issue, it entered a judgment requiring INA to pay Travelers $3,240,676.51 in prejudgment interest. [39] We side with the District Court. It is not hard to see the logic of Travelers' position. The August 14, 2006 order, by establishing Travelers' entitlement to an award of damages, also established its entitlement to prejudgment interest on that award. Post-judgment interest is typically understood as compensation to ensure that a money judgment will be worth the same when it is actually received as it was when it was awarded. Dunn v. HOVIC, 13 F.3d 58, 60 (3d Cir.1993). Thus, it makes sense that post-judgment interest on prejudgment interest would begin to run as soon as an order establishing the right to prejudgment interest is entered. See Caffey v. Unum Life Ins. Co., 302 F.3d 576, 590 (6th Cir.2002) (holding that to allow a gap between when a party first became entitled to an award of prejudgment interest and when post-judgment interest on that award began to run would be contrary to the compensatory goal of the post-judgment interest statute). Nonetheless, our decision in Eaves v. County of Cape May, 239 F.3d 527 (3d Cir.2001), precludes us from following that logic here. In Eaves, we addressed whether post-judgment interest on attorneys' fees runs from the date that the District Court rules initially that the plaintiff is entitled to attorney[s'] fees, or alternatively, from the date that the District Court actually quantifies the amount awarded. Id. at 527-28. We ultimately concluded that post-judgment interest on an attorney[s'] fee award runs from the date that the District Court enters a judgment quantifying the amount of fees owed... [,] rather than the date that the Court finds that the party is entitled to recover fees, if those determinations are made separately. Id. at 542. Applying Eaves ' analysis to this case, the relevant date was December 5, 2007, when Travelers' award of prejudgment interest was quantified. Travelers urges us to distinguish this case from Eaves on the ground that Eaves dealt with an award of attorneys' fees and we deal here with an award of prejudgment interest. We see no basis for doing so. The conclusion in Eaves was driven by a general reading of the requirements of 28 U.S.C. § 1961(a), the statute that provides for post-judgment interest, not anything particular to attorneys' fees as a type of award. See Eaves, 239 F.3d at 538 (explaining that its result is based on the plain language of § 1961(a), rather than a fact-sensitive application of the policy considerations underlying the statute). Section 1961(a) provides in pertinent part that [i]nterest shall be allowed on any money judgment in a civil case recovered in a district court, and that such interest shall be calculated from the date of the entry of the judgment .... § 1961(a). What we held in Eaves was that (1) under § 1961(a), an award must be granted pursuant to a money judgment to trigger post-judgment interest, and (2) to count as a money judgment a judgment must include both an identification of the parties for and against whom judgment is being entered, and  a definite and certain designation of the amount ... owed. Eaves, 239 F.3d at 532-33 ( quoting Penn Terra Ltd. v. Dep't of Envtl. Res., 733 F.2d 267, 275 (3d Cir.1984)) (emphasis in original). As such, Eaves requires us to read § 1961(a) as providing that, as a general matter, post-judgment interest on a particular award only starts running when a judgment quantifying that award has been entered. See Skretvedt v. E.I. Dupont De Nemours, 372 F.3d 193, 217 (3d Cir.2004) (interpreting Eaves to stand for this general reading of § 1961(a)). Although there is much to criticize in Eaves, its interpretation of § 1961(a) controls until the Supreme Court, or our own Court en banc, says otherwise. Accordingly, post-judgment interest on Travelers' award of prejudgment interest did not begin to run until the December 5, 2007 order was entered quantifying the amount in prejudgment interest owed to Travelers. That the District Court incorrectly calculated the amount of prejudgment interest due (by using the Pennsylvania, rather than the New York, rate) does not change the date of accrual. See Dunn, 13 F.3d at 61-62 (explaining that, when a court of appeals merely modifies an award, that does not change the date on which post-judgment interest on that award began to run). We thus direct that the post-judgment interest on the District Court's revised calculation of prejudgment interest continue to run from the date on which the order quantifying the award was entered (December 5, 2007).