Ce Design, Ltd. v. CY's Crab House N., Inc., 11–3731.

• Decision Date: 30 September 2013
• Docket Number: No. 11–3731.,11–3731.
• Citation: 731 F.3d 725
• Parties: CE DESIGN, LTD., individually and as the representative of a class of similarly situated persons, Plaintiff–Appellee, v. CY'S CRAB HOUSE NORTH, INC., and CY'S Crabhouse & Seafood Grill, Inc., Defendants, and Truck Insurance Exchange, Proposed Intervenor–Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

731 F.3d 725

CE DESIGN, LTD., individually and as the representative of a class of similarly situated persons, Plaintiff–Appellee,

v. CY'S CRAB HOUSE NORTH, INC., and CY'S Crabhouse & Seafood Grill, Inc., Defendants,andTruck Insurance Exchange, Proposed Intervenor–Appellant.

No. 11–3731.

United States Court of Appeals, Seventh Circuit.

Argued Sept. 13, 2012.

Decided Sept. 30, 2013.

Phillip A. Bock, Robert M. Hatch, James M. Smith, Attorneys, Bock & Hatch, Chicago, IL, for Plaintiff–Appellee.

Albert M. Bower, Attorney, SmithAmundsen, LLC, Chicago, IL, for Defendant.

Steven D. Pearson, Philip R. King, Attorneys, Meckler Bulger Tilson Marick & Pearson LLP, Chicago, IL, for Proposed Intervenor–Appellant.

Before MANION, SYKES, and HAMILTON, Circuit Judges.

SYKES, Circuit Judge.

This appeal arises from the world of high-stakes fax-spam litigation. We deal here with a discrete procedural issue that affects appellate jurisdiction. After the district court entered final judgment approving a settlement between the plaintiff class and the defendants, the defendants' insurer moved to intervene for the purpose of undoing the settlement and seeking class decertification based on misconduct by class counsel. The district court denied the motion as untimely, and the insurer appealed.

The insurer's notice of appeal purports to bring up the district court's order denying intervention and the final judgment. The notice was timely as to the former but not the latter. So although we have jurisdiction to review the order denying intervention, we cannot grant any meaningful relief because we lack jurisdiction to review the final judgment. Accordingly, we dismiss the appeal for lack of jurisdiction. We note for completeness that the insurer's argument in support of intervention—that certain misconduct by class counsel necessitates decertification of the class—has been rejected in a recent decision involving the same events and attorneys. See Reliable Money Order, Inc. v. McKnight Sales Co., 704 F.3d 489 (7th Cir.2013).

I. Background

The underlying facts have been the subject of several other appeals involving the same litigants, events, and attorneys; because the factual background is not relevant to the jurisdictional question, we direct interested readers to our discussions in Reliable Money Order, 704 F.3d at 493–97;Creative Montessori Learning Centers v. Ashford Gear LLC, 662 F.3d 913, 915 (7th Cir.2011); and CE Design Ltd. v. King Architectural Metals, Inc., 637 F.3d 721, 723–24 (7th Cir.2011). To resolve this appeal, we need only recount a few procedural details of the case.

Plaintiff CE Design is “a small civil engineering firm in the Chicago area that, unusually for a business firm, is an avid class-action plaintiff [, having] filed at least 150 class action suits under the Telephone Consumer Protection Act.” CE Design Ltd., 637 F.3d at 723. This case is one of them. CE Design sued Cy's Crab House North, Inc., and Cy's Crabhouse & Seafood Grill, Inc., on behalf of a class of junk-fax recipients. Putative intervenor and appellant Truck Insurance Exchange is the liability carrier for the Cy's Crab House restaurants and has been involved in this litigation from the beginning, providing a defense under a reservation of rights.

The case was certified as a class action, and after four years of litigation, it proceeded to trial in October 2010. In the middle of trial, without notifying or obtaining consent from their insurer, the defendantssettled with the class, putting the insurer's policy limits on the hook. Substitution of counsel and state-court coverage litigation ensued. A year later, on October 27, 2011, the district court approved the final settlement and entered final judgment.

On November 22, 2011—not quite a month later—this court issued its decision in Ashford Gear casting significant doubt on the conduct of class counsel. 662 F.3d at 917–19. The panel opinion in Ashford Gear vacated the class certification and remanded to the district court for application of a newly explicated standard for evaluating misconduct by class counsel. Id. at 919.

In light of Ashford Gear, Truck Insurance moved to intervene in this case for the purpose of reopening the judgment, challenging the settlement, and seeking decertification of the class based on the misconduct of class counsel. The intervention motion was filed on November 23, 2011, the day after our decision in Ashford Gear was released. As of that date, the 30–day time period to appeal the judgment had not yet run. See 28 U.S.C. § 2107; Fed. R.App. P. 4(a)(1)(A). At this point Truck Insurance could have filed a contingent notice of appeal from the judgment to protect its interests should intervention be granted, either by the district court or this court. It did not do so. Instead, in its motion to intervene, Truck Insurance asked the district court for a 14–day extension of the time to appeal.

The district court held a hearing on the intervention motion on November 28, 2011, which was the last day to appeal the judgment. The judge expressed some “pretty serious concerns about [the] timeliness” of the intervention motion and gave Truck Insurance a day to file a reply brief on the question. The judge rescheduled the hearing to December 1 and said, “I will rule on [the motion] then.” This prompted a discussion about the time limit for filing an appeal from the judgment. The judge noted that under Rule 4(a)(5) of the Federal Rules of Appellate Procedure, “I can extend the time to file a notice of appeal if a party so moves ... no later than 30 days after the time expires.” Counsel for Truck Insurance pointed out that the insurer wasn't a party yet. The judge replied, “If I grant the motion to intervene, ... that relates back to the day that you filed the motion to intervene.” Referring to the deadline to appeal the judgment, the judge told counsel: “I will extend it. If I conclude that you're entitled to intervene or entitled to an extension, you're not going to have a problem here.”

On December 1 the court denied the motion to intervene as untimely. The court reasoned that Truck Insurance had known for more than a year that its interests were on the line. The order denying intervention said nothing about extending the deadline to appeal. On December 2, 2011, Truck Insurance filed a notice of appeal purporting to appeal both the December 1 order denying intervention and the October 27 final judgment, although as to the latter, the notice was styled as a “conditional” appeal of the judgment “as it relates to class certification.” CE Design moved to dismiss for lack of appellate jurisdiction. We took the motion with the merits of the case and now grant the motion and dismiss the appeal.

II. Discussion

Truck Insurance's notice of appeal purports to appeal both the order denying its motion to intervene and the final judgment. The notice is untimely as to the latter; it was filed 36 days after the judgment was entered. The time to appeal the judgment had expired, and no extension had been granted.

Truck Insurance insists that the district court orally extended the time to appeal during the November 28 hearing on the intervention motion. Rule 4(a)(5) of the Federal Rules of Appellate Procedure authorizes the district court to extend the time to appeal “if ... a party so moves no later than 30 days after the time prescribed by this Rule 4(a) expires,” Fed. R.App. P. 4(a)(5)(A)(i), except that “[n]o extension ... may exceed 30 days after the prescribed time or 14 days after the date when the order granting the motion is entered,” Fed. R.App. P. 4(a)(5)(C). The transcript of the November 28 hearing reflects that the court and counsel discussed the possibility of an extension of time to appeal but the discussion was contingent. The judge mentioned the availability of an extension of time under Rule 4(a)(5) and then stated as follows: “I will extend it. If I conclude that you're entitled to intervene or entitled to an extension, you're not going to have a problem here.” (Emphasis added.) The context makes clear that the judge was announcing his willingness to grant a retroactive extension in the future, not that he was granting a prospective extension of the appeal period right then and there. The court's December 1 order denying the intervention motion makes no mention of extending the time to appeal, and Truck Insurance did not ask the court for a ruling on the matter.

Truck Insurance argues in the alternative that its appeal of the order denying intervention somehow saves its untimely appeal of the judgment or perhaps revives the time to appeal it. We do not see how. The statutory time limit to appeal provides as follows:

Except as otherwise provided in this section, no appeal shall bring any judgment, order or decree in an action, suit or proceeding of a civil nature before a court of appeals for review unless notice of appeal is filed, within thirty days after the entry of such judgment, order or decree.

28 U.S.C. § 2107 (emphasis added). “Rule 4 of the Federal Rules of Appellate Procedure carries § 2107 into practice,” Bowles v. Russell, 551 U.S. 205, 208, 127 S.Ct. 2360, 168 L.Ed.2d 96 (2007), and similarly provides that the notice of appeal “must be filed with the district clerk within 30 days after entry of the judgment or order appealed from,” Fed. R.App. P. 4(a)(1)(A). The text of the statute and rule makes clear that the 30–day clock runs from entry of the specific order or judgment appealed from. Here, the order denying intervention and the final judgment are distinct and separate appealable orders. Indeed, we have held that an order denying intervention is an immediately appealable “final decision” under 28 U.S.C. § 1291 even if the rest of the case remains pending and unfinished in the district court. See Retired Chi. Police Ass'n v. City of Chicago, 7 F.3d 584, 594 n. 11 (7th Cir.1993); see also Purcell v. BankAtlantic Fin. Corp. 85 F.3d 1508, 1511 n. 2 (11th...