Video Views, Inc. v. Studio 21, Ltd.

• Decision Date: 04 August 1986
• Docket Number: No. 86-1039,86-1039
• Citation: 797 F.2d 538
• Parties: VIDEO VIEWS, INC., Plaintiff-Appellee, v. STUDIO 21, LTD. and Joseph Sclafani, Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 538

797 F.2d 538

VIDEO VIEWS, INC., Plaintiff-Appellee, v. STUDIO 21, LTD. and Joseph Sclafani, Defendants-Appellants.

No. 86-1039.

United States Court of Appeals, Seventh Circuit.

Argued June 2, 1986.

Decided Aug. 4, 1986.

Michael Null, Chicago, Ill., for defendants-appellants.

David A. Axelrod, Feiwell, Galper, Lasky & Berger, Ltd., Chicago, Ill., for plaintiff-appellee.

Before BAUER and EASTERBROOK, Circuit Judges, and SWYGERT, Senior Circuit Judge.

SWYGERT, Senior Circuit Judge.

The defendants Studio 21, Ltd. and Joseph Sclafani ("Studio 21") appeal from an order of the district judge granting a preliminary injunction in favor of the plaintiff, Video Views, Inc., which prohibits the defendant from exhibiting certain motion pictures for which Video Views claims to have exclusive licensing rights. We dismiss the appeal.

In the proceedings below, the district judge referred Video Views' motion for a preliminary injunction to a magistrate pursuant to 28 U.S.C. Sec. 636(b)(1). The magistrate issued a decision in which she rejected various arguments raised by Studio 21 and she recommended that a preliminary injunction be issued. In that decision, she noted that the parties had ten days within which to file objections to her decision with the district judge and that failure to file such objections "may constitute a waiver" of the right to appeal to this court.

Studio 21 moved for and was granted an extension of time in which to file its objections. On the day the objections were to be filed, Studio 21 again moved for an extension of time which the district judge denied. Noting that no proper objections to the magistrate's report had been filed, the district judge adopted her proposed findings and conclusions of law in their entirety.

On appeal, neither party raised the issue of whether Studio 21's failure to file with the district court objections to the magistrate's report constituted a waiver of its right to appeal. At oral argument, the court questioned the parties as to whether or not such a rule as was approved of by the Supreme Court in Thomas v. Arn, --- U.S. ----, 106 S.Ct. 466, 88 L.Ed.2d 435 (1985), should be adopted by this court and applied to the facts of this case. Neither party responded in detail. Studio 21's motion to file post-argument brief on this issue was granted, and both parties filed supplemental briefs. Studio 21 argued that while, in general, a waiver rule should be adopted, that rule should be given prospective effect only and not applied to this case.

At least five circuits have adopted a rule, pursuant to their supervisory powers, that failure to object to the magistrate's report, issued pursuant to 28 U.S.C. Sec. 636(b)(1), constitutes a waiver of all legal and factual issues. See Thomas, --- U.S. at ---- n. 4, 106 S.Ct. at 470 n. 4. Two others have adopted a waiver rule regarding only factual issues. Id. This circuit has yet to adopt such a rule, Delgado v. Bowen, 782 F.2d 79, 82 n. 2 (7th Cir.1986), although there have been indications that this court would approve of such a rule, see, e.g., Hudson v. Nabisco Brands, Inc., 758 F.2d 1237, 1245-48 (7th Cir.1985) (Flaum, J., concurring).

We now decide to adopt the rule that failure to file objections with the district judge waives the right to appeal all issues, both factual and legal, based on the reasons set forth by the other courts of appeal. ^* See, e.g., United States v. Schronce, 727 F.2d 91, 93-94 (4th Cir.), cert. denied, 467 U.S. 1208, 104 S.Ct. 2395, 81 L.Ed.2d 352 (1984); McCarthy v. Manson, 714 F.2d 234, 237-38 (2d Cir.1983); United States v. Walters, 638 F.2d 947, 949-50 (6th Cir.1981); United States v. Lewis, 621 F.2d 1382, 1386 (5th Cir.1980); Park Motor Mart, Inc. v. Ford Motor Co., 616 F.2d 603, 605 (1st Cir.1980). We decline, however, to adopt in this case the approach of the Sixth Circuit which gives only prospective effect to the rule. See Walters, 638 F.2d at 949-50. See also Lorin Corp. v. Goto & Co., 700 F.2d 1202, 1205-07 (8th Cir.1983). We do so for several reasons. First, the issue has been adequately briefed on appeal. As a result, we are not required to decide the appropriateness of the application of this rule in a vacuum. Second, because the issue has been briefed, Studio 21 has had the opportunity to demonstrate that it had sufficient cause for failing to object, such that the waiver should not be applied. Third, the magistrate adequately informed the defendants that their failure to file objections might constitute a waiver, see, e.g., Carr v. Hutto, 737 F.2d 433, 434 n. 2 (4th Cir.1984); cf. Lorin Corp., 700 F.2d at...