Higgins v. Smith Intern., Inc.

• Decision Date: 21 September 1983
• Docket Number: No. 82-3232,82-3232
• Citation: 716 F.2d 278
• Parties: 99 Lab.Cas. P 55,417 John C. HIGGINS, Plaintiff-Appellee Cross-Appellant, v. SMITH INTERNATIONAL, INC., Defendant-Appellant Cross-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 278

716 F.2d 278

99 Lab.Cas. P 55,417

John C. HIGGINS, Plaintiff-Appellee Cross-Appellant, v. SMITH INTERNATIONAL, INC., Defendant-Appellant Cross-Appellee.

No. 82-3232.

United States Court of Appeals, Fifth Circuit.

Sept. 21, 1983.

Reid K. Hebert, Lake Charles, La., for defendant-appellant cross-appellee.

Newman & Fazzio, Raleigh Newman, Donald McKnight, Lake Charles, La., for plaintiff-appellee cross-appellant.

Appeals from the United States District Court for the Western District of Louisiana.

Before REAVLEY and JOHNSON, Circuit Judges, WYZANSKI, ^* District Judge.

JOHNSON, Circuit Judge:

A jury found that Smith International, Inc. entered an oral contract with John C. Higgins to employ him for two years at $42,000 per year, and then breached it by dismissing him six months into the contract without adequate justification. The district court initially entered judgment on the verdict; some time later, it granted Smith International's motion for a remittitur and entered a superseding judgment reducing Higgins' damage award. Smith International and Higgins appeal. We dismiss Higgins' cross-appeal and affirm the judgment of the district court.

I.

Higgins went to work for Smith International in August 1975 as a fishing tool expert with its Brazilian offshore oil drilling operations. In late November, while working on one of the rigs, he slipped and fell down a long flight of stairs. The initial bruising and soreness in his lower back intensified over the ensuing months; in February, he sought treatment in a Brazilian emergency clinic. The doctors diagnosed his problem as a compression fracture of two vertebrae in his lower spine. Smith International offered to return him to Louisiana for treatment. Higgins accepted and flew back to New Orleans in mid-February. He was met on arrival by the Smith International operations manager, who rented a car for Higgins' use while in the states and accompanied him on a diagnostic visit to the Oschner Foundation Hospital.

About ten days later, Higgins met with Champ Emerson, the executive vice-president of Smith International. Emerson explained to him that the $3500 per month salary he had been earning in Brazil actually consisted of $1000 per month base pay and a $2500 per month cost of living allowance. Emerson then informed him that, as the cost of living allowance was not available to Smith International employees living in the United States, he would receive only the $1000 per month base pay until he returned to Brazil. Emerson directed him to appear at the clinic the following day for further medical examinations.

Higgins did not keep the appointment. Instead, after thinking the matter over for a few days, he decided that because he owed alimony of $600 per month and because recommended surgery and recovery would probably take four months, he had no choice but to return to Brazil. In early March, Higgins left the rental car in a New Orleans motel parking lot and flew back to Brazil. Not until he arrived there did he learn that he had been terminated several days earlier for missing the medical appointment scheduled by Emerson, failing to drop off the rental car on time, and not reporting to work for three consecutive days. Higgins returned to the United States and filed this action.

Higgins began this lawsuit with claims under the Jones Act and in admiralty for personal injury compensation. Later, he added a breach of contract claim: he charged that he and Emerson had verbally agreed on the day he was hired that he would work for Smith International for two years at $42,000 per year, and that Smith International breached that contract by firing him six months into the term without adequate justification. The matter was tried to a jury. Higgins prevailed on all counts. The jury awarded him $122,500 for his personal injuries and $61,298.73 as salary owing for the eighteen months remaining on the employment contract. The district court entered a judgment on the verdict. Smith International settled with him on the personal injury claims but moved for judgment notwithstanding the verdict, a remittitur or a new trial on the contract claim. The district court denied its motions for judgment n.o.v. and a new trial, but granted a remittitur reducing the contract damages to $18,000--the amount of the base salary payable over the portion of the two-year period remaining when Higgins was fired.

Smith International appeals, claiming that Higgins did not satisfy Louisiana requisites for proof of an oral contract, that the jury erred in concluding that it did not have cause to discharge Higgins, and that the district court misstated the law in its instructions to the jury. Higgins filed a notice of cross-appeal from the district court's order of remittitur.

II.

The manner in which the district court handled the matter of remittitur raises a threshold question of our jurisdiction, and an ancillary problem in definition of the issues properly before us. The jurisdictional problem is one of finality. Intermeshed with it is the propriety of Higgins' cross-appeal.

The district court's order of remittitur stated:

The law of this Circuit requires that in the event the trial judge concludes that a jury verdict for damages so far departs from the evidence as to warrant his granting a new trial, with respect to the amount of damages, it should simply grant a new trial on the damage issue or it should give the winning party an option of having a new trial or agreeing to a remittitur of part of the amount found in the jury verdict. Under the unusual facts of this case the appropriate action for this Court to take is to reduce the judgment on the contract claim to $18,000 and to sign a judgment for that amount. This we will do. A judgment to that effect is attached. ² The order was accompanied by an entry of judgment in the amount of $18,000. Higgins did not move for a new trial within the ten days allowed under the rules, Fed.R.Civ.P. 59(b). The only actions following in the district court were Smith International's notice of appeal, and Higgins' subsequent notice of cross-appeal.

The district court correctly stated the principle governing remittitur: the plaintiff must be offered a choice between acceptance of a reduction in damages or a new trial. Keyes v. Lagua, 635 F.2d 330 (5th Cir.1981); Stewart v. Atlantic Pipe Line Co., 479 F.2d 311 (5th Cir.1973); Gorsalitz v. Olin-Mathieson Chemical Corp., 429 F.2d 1033 (5th Cir.1970), modified, 456 F.2d 180 (5th Cir.1972), cert. denied, 407 U.S. 921, 92 S.Ct. 2463, 32 L.Ed.2d 807 (1972). Implicit in that rule are its corollaries: imposition of a remittitur by the district court requires a reversal and remand for the plaintiff's exercise of his right to choose. Stewart, 479 F.2d at 312. If the choice is properly put to the plaintiff, the matter, under the direction and control of the district court, remains open in the district court until he elects one of his options. The decision offering remittitur or a new trial is incomplete, interlocutory, and not appealable. Eaton v. National Steel Products Co., 624 F.2d 863 (9th Cir.1980); Evans v. Calmar S.S. Co., 534 F.2d 519 (2d Cir.1976); DePinto v. Providence Security Life Insurance Co., 323 F.2d 826 (9th Cir.1963), cert. denied, 376 U.S. 950, 84 S.Ct. 965, 11 L.Ed.2d 969 (1964).

Three questions arise from the course of events in the district court: Did the district court's order conform to the requirement that the plaintiff be allowed to choose between a new trial and a remittitur? If so, did Higgins accept the remittitur by failing timely to move for a new trial? And if so, did Higgins' subsequent acceptance of the remittitur confer finality on the judgment entering the remittitur? The first and last questions are answered by Howell v. Marmpegaso Compania Naviera, S.A., 566 F.2d 992 (5th Cir.1978). That decision was the second appellate ruling in the course of that case. In the first appeal, this Court decided that damages awarded to plaintiff Howell were excessive, and remanded with instructions to the district court to offer Howell the choice between a remittitur or a new trial. Instead of giving Howell the choice, the district court simply entered a reduced judgment. Howell subsequently filed an acceptance of the remittitur. On appeal, this Court held that, notwithstanding the apparent finality of the judgment entering the remittitur, Howell had the right to reject the remittitur and insist on a new trial. We decided that the judgment remained " 'open, unfinished [and] inconclusive,' Cohen v. Beneficial Loan Corp., 337 U.S. 541, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949)" until Howell accepted it. Upon his acceptance of the remittitur, we held, the judgment became final and appealable. Id.; accord, Demeretz v. Daniels Motor Freight, Inc., 307 F.2d 469, 471 (3d Cir.1962).

The circumstances of that case closely parallel the situation now before us. In acting on Smith International's motion, the district court clearly and correctly stated governing law and advised Higgins that he could exercise his right of choice by requesting new trial in lieu of the remittitur. If Higgins' failure to request a new trial qualifies as an acceptance of the remittitur, the reduced judgment became final and appealable on the day his right to seek a new trial lapsed. The critical issue, then, is whether Higgins' failure to request a new trial can be considered an acceptance of the remittitur. We believe that under the circumstances of this case, it can.

It is clear that the district court and the parties understood the intent of the order of remittitur to be the final, dispositive action in the district court, unless the plaintiff took affirmative steps to claim his right to a new trial. The district court's order acknowledged the controlling principles, and advised the plaintiff of his right to set aside its order by electing a new trial. Higgins stated, in his supplemental brief addressing this...