LSLJ Partnership v. Frito-Lay, Inc.
Decision Date | 08 March 1991 |
Docket Number | D,INCORPORATE,FRITO-LA,No. 89-3555,89-3555 |
Citation | 920 F.2d 476 |
Parties | 1990-2 Trade Cases 69,278, 18 Fed.R.Serv.3d 816 LSLJ PARTNERSHIP, Plaintiff-Appellant, v.efendant-Appellee. |
Court | U.S. Court of Appeals — Seventh Circuit |
Anthony S. DiVincenzo, Chicago, Ill., John C. Brezina, Brezina & Buckingham, Oak Brook, Ill., for plaintiff-appellant.
Louis C. Keiler, Kenneth H. Hoch, Earl E. Pollock, Sonnenschein, Nath & Rosenthal, Chicago, Ill., for defendant-appellee.
Before CUMMINGS and COFFEY, Circuit Judges, and GORDON, Senior District Judge. *
The plaintiff-appellant appeals from an order of the district court denying plaintiff's motion to vacate a portion of the judgment under Rule 60(b) of the Federal Rules of Civil Procedure. We reverse and remand.
Jays Foods, Inc. instituted this litigation in November 1978 against Frito-Lay, Inc., for violation of Sec. 2 of the Sherman Act (15 U.S.C. Sec. 2), Sec. 2(a) of the Robinson-Patman Act (15 U.S.C. Sec. 13(a)), and the Illinois Consumer Fraud and Deceptive Business Practices Act (Ill.Rev.Stat. Chap. 121 1/2 Secs. 261 et seq.) 1 alleging that the defendant engaged in anti-competitive conduct which included predatory pricing and geographic price discrimination. After entry of a number of summary judgment motions, the trial court entered judgment in favor of the defendant. 2 The plaintiff appealed these rulings, and on September 8, 1988, this court affirmed the trial court in an unpublished order. The Supreme Court on appeal denied the plaintiff's petition for a writ of certiorari.
One year after this court affirmed the trial court's disposition of the case, we issued an opinion in A.A. Poultry Farms, Inc. v. Rose Acre Farms, Inc., 881 F.2d 1396 (7th Cir.1989), which the plaintiff relies upon and claims represents a change in law, thus in conflict with the reasoning of the trial court in this action. The plaintiff filed a Motion to Vacate the Judgment in the trial court under Rule 60(b) of the Federal Rules of Civil Procedure. Plaintiff's motion sought to vacate the judgment on its Robinson-Patman Act claims. 3 The district court ruled that it was without jurisdiction to entertain plaintiff's 60(b) motion absent leave from this court. Thus, the district court did not rule on the merits of plaintiff's motion. Plaintiff appeals.
At the outset, we note that the issue before this court is whether the district court committed error in holding that it was without jurisdiction to entertain plaintiff's Rule 60(b) motion absent leave from this court. 4 We do not address the merits of the plaintiff's 60(b) motion and our review is limited to the jurisdictional question.
At one time most circuits required that an appellant obtain leave of the court of appeals before filing a Rule 60(b) motion in a district court. 5 However, in 1976, the Supreme Court held that a district court may reopen a case which had been reviewed on appeal without leave from the court of appeals. Standard Oil Co. of California v. United States, 429 U.S. 17, 97 S.Ct. 31, 50 L.Ed.2d 21 (1976). In Standard Oil, the appellant sought leave to have the Supreme Court recall its mandate in order to reopen a judgment on the basis of alleged misconduct by both government counsel and a material witness. The Supreme Court denied the motion to recall the mandate, holding that a district court could entertain a Rule 60(b) motion without leave from the Supreme Court. Id. at 17, 97 S.Ct. at 31. While citing arguments that the appellate leave requirement protected the finality of the judgment as well as allowing the appellate court to screen out frivolous Rule 60(b) motions, the Supreme Court nonetheless found the arguments in favor of requiring appellate leave unpersuasive:
Id. at 18 and 19, 97 S.Ct. at 31 and 32 (citations omitted). The Court further noted that the appellate leave requirement "burden[ed] the increasingly scarce time of the federal appellate courts [and saw] no reason to continue this 'unnecessary and undesirable clog on the proceedings.' " Id. at 19, 97 S.Ct. at 32 (citations omitted).
We recognize that plaintiff's 60(b) motion is based on an alleged change in law rather than prosecutorial misconduct as in Standard Oil. However, a change in law is an event arising after the appellate court mandate, and under the principles of Standard Oil, we believe that a district court has jurisdiction to address a change in law without "flouting the mandate" of the appellate court. The Fourth Circuit has held that a Rule 60(b) motion based on a change in decisional law does not require appellate court leave. Patterson v. American Tobacco Company, 634 F.2d 744 (4th Cir.1980). Recently, this court recognized that Standard Oil eliminated the requirement of appellate leave even when judgment has been affirmed, Landau & Cleary, Ltd. v. Hribar Trucking, Inc., 867 F.2d 996, 1001-1002 (7th Cir.1989), noting that the rule of appellate leave, while once the law, was "no longer correct." Moreover, in Watson v. Symons Corp., 121 F.R.D. 351 (N.D.Ill.1988), relief under Rule 60(b) was granted due to a change in law even though no appeal was taken.
Possibly in an effort to avoid the holding of Standard Oil, the defendant argues that the district court in effect ruled on the merits of the motion to vacate judgment and held that a change of law can never be the basis of relief under Rule 60(b). However, his argument that the court ruled on the merits of the motion is belied by the transcript filed in this court of the district court proceedings on the Plaintiff's Motion to Vacate:
Contrary to the defendant's assertion, it is eminently clear that the district court did not rule on the merits of the plaintiff's Rule 60(b) motion and ruled merely that it was without jurisdiction and invited an appeal. 6 Thus, the trial court erroneously ruled that resolution of the appeal divested it of jurisdiction to entertain a Rule 60(b) motion.
"A motion to vacate a judgment pursuant to Rule 60(b) is addressed to the sound discretion of a district court and a denial of a 60(b) motion will not be overturned on appeal in the absence of an abuse of discretion." McKnight v. United States Steel Corp., 726 F.2d 333, 335 (7th Cir.1984). However, "[a] trial court may abuse its discretion by failing to exercise its discretion." FMC Corp. v. Varonos, 892 F.2d 1308, 1316 (7th Cir.1990); see also United States v. Threw, 861 F.2d 1046, 1049 (7th Cir.1988); Hernandez v. Cepeda, 860 F.2d 260, 266 (7th Cir.1988). Furthermore, the "abuse of discretion standard implies that the judge must actually exercise his discretion." United States v. U.S. Currency, In the Amount of $103,387.27, 863 F.2d 555, 561 (7th Cir.1988) (citing In re American Reserve Corp., 841 F.2d 159, 162 (7th Cir.1987)). In this case, the district court's erroneous denial of jurisdiction resulted in an abuse of its discretion when it failed to exercise any discretion in not reaching the merits of the plaintiff's Rule 60(b) motion. We reverse the district court's denial of plaintiff's Rule 60(b) motion and remand for a determination of the merits of the motion.
* Honorable Myron L. Gordon, Senior Judge for the Eastern District of Wisconsin, is sitting by designation.
1 On July 11, 1986, Jays Foods, Inc., assigned its causes of action against Frito-Lay to the LSLJ Company, which was owned by the shareholders of Jays Foods, Inc. In December 1986, LSLJ Company assigned its causes of action to LSLJ Partnership which is composed of the former shareholders of Jays Foods, Inc.
2 On August 1, 1985, the court entered summary judgment on plaintiff's claims under Sec. 2 of the Sherman Act; on February 26, 1987, judgment was entered on plaintiff's claims under the Robinson-Patman Act; and...
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