Court Opinion

ID: 77597
Source: CourtListenerOpinion
Date Created: 2010-04-27 03:32:55+00
Date Added: 2024-06-11T09:39:39.728443
License: Public Domain

[PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS
                                                            FILED
                  FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
                    ________________________ ELEVENTH CIRCUIT
                                                       FEB 5, 2007
                          No. 06-10157              THOMAS K. KAHN
                    ________________________             CLERK

                 D. C. Docket No. 02-80527-CV-KLR

SEB S.A.,

                                               Plaintiff,

                              versus

SUNBEAM CORPORATION,
SUNBEAM PRODUCTS, INC.,

                                               Defendants-
                                               Third-Party-Plaintiffs-
                                               Appellees,

WING SHING INTERNATIONAL LTD. (BVI),

                                               Defendant-
                                               Third-Party -Defendant,

PENTALPHA ENTERPRISES, LTD.,

                                               Defendant-
                                               Third-Party-Defendant-
                                               Appellant,
GLOBAL-TECH APPLIANCES, INC.,

                                                                  Third-Party-Defendant.

                               ________________________

                      Appeal from the United States District Court
                          for the Southern District of Florida
                            _________________________

                                    (February 5, 2007)

Before PRYOR and FAY, Circuit Judges, and STEELE,* District Judge.

PRYOR, Circuit Judge:

       The issue in this appeal is on what date prejudgment interest ceased to

accrue and postjudgment interest began to accrue on a jury verdict against

Sunbeam Corporation and Sunbeam Products, Inc., (collectively “Sunbeam”) and

in favor of Pentalpha Enterprises, Inc., for breach of contract. In a previous appeal,

this Court reversed in part the judgment entered by the district court on the jury

verdict, because the calculation of prejudgment interest was erroneous. On

remand, the district court determined that prejudgment interest ceased to accrue

and postjudgment interest began to accrue on the date of its original judgment.

Because we conclude that prejudgment interest ceased to accrue and postjudgment

interest began to accrue on the date of the amended judgment, we reverse.

      *
        Honorable William H. Steele, United States District Judge for the Southern District of
Alabama, sitting by designation.

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                                I. BACKGROUND

      This controversy based on diversity jurisdiction arose from a complaint filed

by SEB S.A. against Sunbeam, Global-Tech Appliances Inc. (formerly known as

Wing Shing International Ltd. (BVI)), and Pentalpha for patent infringement.

Sunbeam later filed a third-party complaint and a cross-claim against Global-Tech

and Pentalpha for indemnification, and Pentalpha filed a counterclaim against

Sunbeam for fraud and breach of contract. The cross-claim for indemnification

and the counterclaim for breach of contract proceeded to a jury trial.

      On January 16, 2004, the jury returned its verdict. On the claim for breach

of contract, the jury awarded Pentalpha $6,600,000. The district court entered

judgment on February 11, 2004, and awarded Pentalpha $6,600,000 plus

$32,909.59 of prejudgment interest for the period from the date of the jury verdict

to the date of the judgment.

      On appeal, this Court affirmed the jury verdict, but remanded with

instructions to award additional prejudgment interest. SEB S.A. v. Sunbeam

Corp., No. 04-12465, 2005 WL 1926418, at *22 (11th Cir. Aug. 12, 2005). The

opinion of this Court explained that Pentalpha was entitled to prejudgment interest

from June 30, 2001, not the later date of the jury verdict. Id. at *19, *22. The

mandate issued on September 12, 2005, and incorporated the opinion by reference.

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       On December 12, 2005, the district court entered an order and an amended

judgment, in which it corrected its error. The district court also determined that

prejudgment interest ceased to accrue and postjudgment interest began to accrue on

February 11, 2004, the date of its original judgment. Pentalpha objected that

Florida law required that prejudgment interest accrue until the date of the amended

judgment and Federal Rule of Appellate Procedure 37 required that postjudgment

interest begin to accrue on that date.

                           II. STANDARD OF REVIEW

       We review de novo both the interpretation of a federal rule of procedure,

Vencor Hosps., Inc. v. Standard Life & Accident Ins. Co., 279 F.3d 1306, 1308

(11th Cir. 2002), and the calculation of prejudgment interest, when that calculation

depends on the construction of state law, Alphamed, Inc. v. B. Braun Med., Inc.,

367 F.3d 1280, 1285 (11th Cir. 2004).

                                  III. DISCUSSION

       To resolve this appeal, we must address two matters: first, under Federal

Rule of Appellate Procedure 37, when postjudgment interest began to accrue; and

second, whether prejudgment interest accrued until that date. We address each

issue in turn.

       A. Under Rule 37, Postjudgment Interest Began to Accrue on the Date
                            of the Amended Judgment.

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      Pentalpha contends that the district court exceeded the scope of its authority

under Rule 37. Pentalpha asserts that, under Rule 37(b), the district court had no

choice but to begin postjudgment interest on the date of the amended judgment.

We agree.

      Rule 37 governs the award of postjudgment interest by a district court after

an appeal. See Fed. R. App. P. 37. When the appellate court affirms “a money

judgment in a civil case,” postjudgment interest “is payable from the date when the

district court’s [original] judgment was entered,” unless the law provides

otherwise. Fed. R. App. P. 37(a). When the appellate court “modifies or reverses a

judgment with a direction that money judgment be entered in the district court, the

mandate [the appellate court issues] must contain instructions about the allowance

of interest.” Fed. R. App. P. 37(b). “If the mandate is silent about interest, . . . the

district court on remand has no choice but to begin postjudgment interest with

entry of the postremand judgment.” 20A James Wm. Moore et al., Moore’s

Federal Practice § 337.12[3] (3d ed. 2006); accord 16A Charles Alan Wright &

Arthur R. Miller, Federal Practice and Procedure § 3983 (3d ed. 1999).

      The default rule that postjudgment interest accrues from the date of the

amended judgment when the mandate is silent about interest derives from Briggs v.

Pennsylvania Railroad Co., 334 U.S. 304, 68 S. Ct. 1039 (1948), which Rule 37

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“codifie[d].” DeLong Equip. Co. v. Wash. Mills Electro Minerals Corp., 997 F.2d
1340, 1341 (11th Cir. 1993). The Briggs rule is that a district court “faced with a

mandate to award $x . . . may not award $x plus interest from an earlier date.” Id.

at 1342. A party “who conceives himself entitled to interest from a date other than

the date of entry of judgment in accordance with the mandate” should petition the

court of appeals to recall and amend the mandate. Fed. R. App. P. 37 advisory

committee’s note; see also DeLong, 997 F.2d at 1341 (amending mandate with

respect to postjudgment interest on motion by plaintiff).

      The default rule derived from Briggs governs this appeal. In the first appeal,

we modified the original money judgment against Sunbeam. Contrary to the

assertion of Sunbeam, it is irrelevant that we affirmed the jury verdict, because we

modified the amount of prejudgment interest, which “‘forms part of the actual

amount of a judgment on a claim.’” Ins. Co. of N. Am. v. Lexow, 937 F.2d 569,

572 n.4 (11th Cir. 1991) (quoting FIGA v. R.V.M.P. Corp., 874 F.2d 1528, 1533

(11th Cir. 1989)); see also Air Separation, Inc. v. Underwriters at Lloyd’s of

London, 45 F.3d 288, 290 (9th Cir. 1995) (describing prejudgment interest as a

“component of a district court’s monetary judgment”).

      Because we did not provide instructions in our mandate or opinion regarding

postjudgment interest, the district court had no choice but to begin postjudgment

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interest on the date of its amended judgment. When the district court determined

that postjudgment interest instead began on the date of its original judgment, it

exceeded the scope of its authority under Rule 37. “‘[T]he appropriate procedure

[was for Sunbeam] to file a motion to reform the mandate under [Rule] 37.’”

Tronzo v. Biomet, Inc., 318 F.3d 1378, 1382 (Fed. Cir. 2003) (quoting Vickers v.

Chiles Drilling Co., 882 F.2d 158, 159 (5th Cir. 1989)).

         B. Prejudgment Interest Ceased to Accrue on the Date of the Amended
                            Judgment of the District Court.

         The remaining question is whether prejudgment interest ceased to accrue on

the date of the original judgment, as the district court concluded, or the date of the

amended judgment. If prejudgment interest ceased to accrue on the date of the

original judgment, there will be a gap of nearly two years for which Pentalpha is

not awarded any interest. “In a diversity case we follow the state law governing

the award of [prejudgment] interest,” Royster Co. v. Union Carbide Corp., 737
F.2d 941, 948 (11th Cir. 1984), and Pentalpha contends that Florida law requires

that prejudgment interest accrue until the date of the amended judgment. We

agree.

         The Supreme Court of Florida has held that a plaintiff is entitled to

prejudgment interest as a matter of law. Argonaut Ins. Co. v. May Plumbing Co.,

474 So. 2d 212, 215 (Fla. 1985). The computation of prejudgment interest is “a

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mathematical computation” and “a purely ministerial duty.” Id. “No ‘finding of

fact’ is needed,” and no discretion is permitted. Id.

      The only reported decision of a Florida court of which we are aware that

addressed this ministerial function is a decision of an intermediate appellate court,

City of Tallahassee v. Block Land & Finance Co., 705 So. 2d 714 (Fla. Dist. Ct.

App. 1998). The court in Block Land affirmed a judgment but remanded with

respect to the award of prejudgment interest. Id. The court instructed the trial

court that prejudgment interest should accrue until the date of the forthcoming

amended judgment of the trial court. Id.

      We have previously determined that Florida law does not allow for a gap in

the award of prejudgment and postjudgment interest. See Bel-Bel Int’l Corp. v.

Cmty. Bank of Homestead, 162 F.3d 1101, 1110-11 (11th Cir. 1998). The district

court in Bel-Bel had awarded prejudgment interest until the date of its original

judgment but began postjudgment interest on the date of its amended judgment.

The result of that calculation was a gap of nearly eight months for which no

interest was awarded, and we reversed. We explained that Florida law did not

allow for the gap:

      A prevailing party is entitled, under Florida law, to prejudgment
      interest. See Argonaut Ins. Co. v. May Plumbing Co., 474 So. 2d 212,
      214-15 (Fla. 1985). Prejudgment interest is, by definition, interest
      that accrues until judgment is rendered. Because final judgment was

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      not rendered in this case until [the date of the amended judgment],
      Bel-Bel was entitled to prejudgment interest at the statutory rate that
      had accrued until that date.

Id. We then remanded to the district court with instructions to award prejudgment

interest until the date of the amended judgment. Id. at 1111.

      The import of Argonaut Insurance and Bel-Bel is that prejudgment interest

accrues until the date of the judgment after which postjudgment interest begins to

accrue. The district court erred. Because postjudgment interest for Pentalpha

began to accrue on the date of the amended judgment, the district court should

have awarded prejudgment interest until that date.

                                IV. CONCLUSION

      The order and the amended judgment of the district court are VACATED to

the extent that they terminate prejudgment interest for Pentalpha on February 11,

2004, and begin postjudgment interest for Pentalpha on that date, and this matter is

REMANDED with instructions to terminate prejudgment interest for Pentalpha on

December 12, 2005, and begin postjudgment interest for Pentalpha on that date.

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