Id Security Systems Canada v. Checkpoint Systems, CIV.A.99-577.

• Decision Date: 20 May 2003
• Docket Number: No. CIV.A.99-577.,CIV.A.99-577.
• Citation: 268 F.Supp.2d 448
• Parties: ID SECURITY SYSTEMS CANADA, INC., Plaintiff, v. CHECKPOINT SYSTEMS, INC., Defendant.
• Court: U.S. District Court — Eastern District of Pennsylvania

Page 448

268 F.Supp.2d 448

ID SECURITY SYSTEMS CANADA, INC., Plaintiff, v. CHECKPOINT SYSTEMS, INC., Defendant.

No. CIV.A.99-577.

United States District Court, E.D. Pennsylvania.

May 20, 2003.

Francis X. Taney, Jr., Buchanan Ingersoll PC, J. Clayton Undercofler, Saul Ewing LLP, Philadelphia, PA, James G. Kress, Howrey, Simon, Arnold & White LLP, Washington, DC, Kara H. Goodchild, Saul Ewing L.L.P., Philadelphia, PA, Kenneth W. Donnelly, Howrey, Simon, Arnold & White LLP, Washington, DC, Rudolph Garcia, Saul Ewing LLP, William A. De Stefano, Saul Ewing LLP, Philadelphia, PA, for Plaintiff.

C. Clark Hodgson, Jr., Stradley, Ronon, Stevens & Young, LLP, Philadelphia, PA, James F. Rill, Howrey, Simon, Arnold & White, LLP, John Deq. Briggs, III, Howrey, Simon, Arnold & White LLP, Washington, DC, Keith R. Dutill, Stradley, Ronon, Stevens & Young, LLP, Malvern, PA, Michael C. Chase, Stradley, Ronon, Stevens & Young, LLP, Patricia Casperson, Stradley, Ronon, Stevens and Young LLP, Philadelphia, PA, for Defendant.

MEMORANDUM

EDUARDO C. ROBRENO, District Judge.

Before the court is Checkpoint's motion to amend the judgment to reflect the $2.11 million credit against the $13 million damage award in favor of ID Security on the state law claims. For the reasons that follow, the motion will be granted.¹

1. FACTS

On May 28, 2002, following a jury trial, the court entered judgment upon the verdict in favor of ID Security Systems Canada, Inc. ("ID Security") and against Checkpoint Systems, Inc. ("Checkpoint") in the amount of $19 million on the state law claims.² Shortly thereafter, the parties submitted to the court a stipulation providing that the amount of the state law claims was to be reduced by $2.11 million, reflecting the amount paid by a non-party, Tokai Electronics, to ID Security in a settlement of litigation in the Canadian courts concerning events related to those complained of in this case. The parties stipulated that, given the $2.11 million credit, judgment in a total of $16,890,000 be entered against Checkpoint:

IT IS FURTHER ORDERED that Judgment is entered in favor of plaintiff and against defendant as to counts four and five in the amount of NINETEEN MILLION DOLLARS ($19,000,000) minus an agreed upon credit of TWO MILLION ONE HUNDRED AND TEN THOUSAND DOLLARS ($2,110,000) for a total of SIXTEEN MILLION EIGHT HUNDRED NINETY THOUSAND DOLLARS ($16,890,000) in the state claims.

The stipulation was approved by the court "by agreement of the parties" on June 12, 2002.

On March 28, 2003, the court entered an order granting in part and denying in part Checkpoint's post-trial motion, the effect of which was, in relevant part, to reduce the jury's award of $19 million, entered against Checkpoint by the court's May 28, 2002 order, by $6 million to $13 million. Thus, the court's order of March 28, 2003 reduced the original amount of the jury award, rather than the stipulated amount. On March 31, 2003, ID Security took an appeal from the court's March 28, 2003 order.

On March 31, 2003, the court entered an order directing Checkpoint, after consultation with ID Security, to submit by April 7, 2003 a proposed form of order setting forth the amount of the altered judgment. The court's order sought to reconcile the amount stated in the March 28, 2003 judgment with the credit earlier granted to Checkpoint by stipulation.

On April 3, 2003, Checkpoint filed a motion to amend the March 28, 2003 order to reduce the $13 million award by $2.11 million in accordance with the June 12, 2002 stipulation submitted by the parties and approved by the court.

The gist of Checkpoint's argument is that it is entitled to have the $2.11 million credit agreed upon by the parties in their June 12, 2002 stipulation applied to the March 28, 2003 order, just as it had been applied to the May 28, 2002 judgment. ID Security demurs, contending that the June 12, 2002 stipulation applied only to the May 28, 2002 judgment and that, under the changed conditions of a greatly reduced judgment, it may now revisit before the court the merits of whether Checkpoint is entitled to the $2.11 million credit granted in the June 12, 2002 order amending judgment. Before the court is Checkpoint's motion to amend the judgment to reflect the $2.11 million credit against the $13 million damage award in favor of ID Security on the state law claims.

II. DISCUSSION

A. Jurisdiction

At oral argument, ID Security asserted that the court did not "have jurisdiction [at this time] to do anything other than deny [Checkpoint's] motion," given that ID Security has filed a notice of appeal. T.T. 5/1/03 (doc. no. 280) at 12. The logical underpinning of this argument appears to be that because the court's March 28, 2003 order, from which ID Security appeals, operates as the "final judgment" in this case, the district court was stripped of jurisdiction upon the filing of a notice of appeal, and therefore has no more authority to alter the judgment. The court does not agree.

Under certain circumstances, the filing of a notice of appeal of a final judgment does not automatically strip the district court of all jurisdiction to alter that judgment. Rather, appellate jurisdiction awaits the complete resolution of the matter in the district court. See Knight v. Brown Transport Corp., 806 F.2d 479, 483 (3d Cir.1986) ("[I]f a notice of appeal is filed before disposition of ... various motions ..., the notice of appeal is a nullity.").

Rule 4 of the Federal Rules of Appellate Procedure "enumerates certain instances in which a .. notice of appeal will `self-destruct' and thereby fail to vest jurisdiction in the appellate courts." Id. (emphasis supplied). In particular, Rule 4(a) provides that "[i]f a party files a notice of appeal after the [district] court ... enters a judgment but before it disposes of [certain motions]the notice becomes effective to appeal ... in whole or in part, when the order disposing of the last such remaining motion is entered." Fed. R.App. P. 4(a)(4)(B)(i). Motions to alter or amend judgment under Rule 59, are among those motions that, if timely filed, have such an effect. Fed. R.App. P. 4(a)(4)(A)(iv). Because the court concludes that Checkpoint's motion is properly construed as a motion to amend judgment pursuant to Rule 59(e),³ it must inquire, for purposes of determining its jurisdiction, whether the motion was timely filed. See Fed. R.App. P. 4(a)(4); Kraus v. Consol. Rail Corp., CIV. A. Nos. 87-5905, 88-2509, 88-5101, 88-5878, 1991 WL 46272 at *2 (E.D.Pa. Mar.27, 1991) (McGlynn, J.) ("[T]he ten day limitation for motions under Fed. R.Civ.P. 59(e) is mandatory and jurisdictional.").

B. Timeliness

Rule 59(e) of the Federal Rules of Civil Procedure provides that "[a]ny motion to alter or amend judgment shall be filed no later than 10 days after entry of the judgment." Fed.R.Civ.P. 59(e). ID Security contends that the instant motion is untimely, because the time for filing such a motion in this case actually lapsed on June 8, 2002, ten days after the original judgment was entered in this case following the jury verdict, even though that original judgment was significantly altered by the court's disposition of posttrial motions in this case. The court does not agree.

Instructive in this regard is Charles v. Daley, 799 F.2d 343 (7th Cir.1986). In that case, after protracted litigation, certain intervenors sought clarification under Rule 59(e) of the district court's award of attorneys' fees. Id. at 344. After the district court clarified the order awarding attorneys' fees, a legal defense fund that had represented one of the intervenors, but that had not itself intervened as a party in the action, filed a Rule 59(e) motion in which it sought to be made a full fledged defendant in order to relieve the intervenors of personal liability. Id. at 345. Almost a year later, the district court ruled on this second motion and thus altered the original attorneys' fees order a second time. Id. at 346. When the intervenors sought to appeal this second alteration, the plaintiffs in the action asked the Seventh Circuit to dismiss the appeal as untimely, on the grounds that the time to file it had started to run when the district court acted on the first Rule 59 motion in the case. Id. The Seventh Circuit declined to adopt that position, and offered the following explanation of the circumstances under which more than one Rule 59 motion may be appropriately filed in a particular case:

The [ten day] time limit [to file Rule 59 motions] would be a joke if parties could continually file new motions, preventing the judgment from becoming final. The 10 days runs from the initial judgment so later motions are not timely. Yet the purpose of Rule 59 is to allow the district court to correct its own errors, sparing the parties and appellate courts the burden of unnecessary appellate proceedings. The purpose of the rule suggests that when a court alters its judgment, a person aggrieved by the alteration may ask for correction. A successive motion directed to the same judgment is ineffectual, but when there is a new judgment an alteration independently sufficient to restart the time for appeal-there is also a new period in which to file a motion under Rule 59.

Id. at 347-48 (second emphasis supplied). The court finds this logic persuasive. By contrast, accepting ID Security's argument that Checkpoint had ten days only from the entry of the original judgment would leave Checkpoint without any vehicle through which it could protest any part of the altered judgment.

In this case, the original judgment in the full amount of the jury verdict rendered against Checkpoint has been substantially altered in the post-trial motions stage. Indeed, by the terms of the court's order of March 28, 2003, which reflected the court's reconsidered calculus of the substantive merits of the case, the $85.5 antitrust verdict against Checkpoint was vacated in its entirety, and the damages...