Silivanch v. Celebrity Cruises, Inc.
| Decision Date | 25 June 2003 |
| Docket Number | Docket No. 02-7320.,Docket No. 02-7229.,Docket No. 02-7604.,Docket No. 02-7600.,Docket No. 02-7603.,Docket No. 02-7607.,Docket No. 02-7279.,Docket No. 02-7595.,Docket No. 02-7606. |
| Citation | 333 F.3d 355 |
| Parties | John and Joyce SILIVANCH, Felice and Frances DeFrancesco, Raymond and Mary Hague, Carol and Richard Lorenzo, Plaintiffs-Appellees-Cross-Appellants, Dorothy Cantone, Kevin L. Jenkins, William, Kathleen, William Jr., and Kimberly Buck, Ronald and Sima Cesarski, Michael and Doris Sckipp, Fran and Rita Galante, Mary and Louis B. Montes, Jane King, Clare Dillon, and Mary Purcell, Plaintiffs-Appellees, v. CELEBRITY CRUISES, INC., and Fantasia Cruising, Inc., Defendants-Cross-Appellants, v. Essef Corp., Pac-Fab, Inc., and Structural Europe, N.V. (f/n/a SFC),<SMALL><SUP>*</SUP></SMALL> Defendants-Appellants-Cross-Appellees. |
| Court | U.S. Court of Appeals — Second Circuit |
Steven M. Hayes, Parcher, Hayes & Snyder (Robert A. Jacobs, of counsel), New York, New York, for Plaintiffs-Appellees-Cross-Appellants John and Joyce Silivanch.
John J. Hession, Dougherty, Ryan, Giuffra, Zambito & Hession, New York, New York, for Plaintiffs-Appellees-Cross-Appellants Felice and Frances DeFrancesco, Raymond and Mary Hague, and Carol and Richard Lorenzo.
John P. James, Friedman & James, LLP, New York, New York, for Plaintiffs-Appellees Dorothy Cantone and Kevin L. Jenkins.
Steven C. Pepperman, Bauman & Kunkis, P.C., New York, New York, for Plaintiffs-Appellees
William, Kathleen, William Jr., and Kimberly Buck, Ronald and Sima Cesarski, and Michael and Doris Sckipp.
Anthony F. Malanga, Jr., Belleville, New Jersey, for Plaintiffs-Appellees Frank and Rita Galante.
Lawrence P. Brady, Doyle & Brady, Kearny, New Jersey, for Plaintiffs-Appellees Jane King and Clare Dillon.
W.M. Serra, Irom, Wittels, Feund, Berne, & Serra, Bronx, New York, for Plaintiffs-Appellees Mary and Louis B. Montes.
James M. Blaney, Starkey, Kelly, Blaney, & White, Toms River, New Jersey, for Plaintiff-Appellee Mary Purcell.
James M. Hazen, Hill, Betts & Nash, New York, New York, for Defendants-Cross-Appellants Celebrity Cruises, Inc. and Fantasia Cruising, Inc.
Thomas S. Kilbane, Squire, Sanders & Dempsey, Cleveland, Ohio (Robin G. Weaver, of counsel), for Defendants-Appellants-Cross-Appellees Essef Corporation, Pac-Fab, Inc., and Structural Europe, N.V.
Before: FEINBERG and SACK, Circuit Judges, and MURTHA, District Judge.**
Plaintiffs-Appellees-Cross-Appellants (the "plaintiffs") move to dismiss appeals filed by Defendants-Appellants-Cross-Appellees Essef Corporation, Pac-Fab, Inc., and Structural Europe, N.V. (collectively "Essef") and cross-appeals filed by Defendants-Cross-Appellants Celebrity Cruises, Inc., and Fantasia Cruising, Inc. (collectively "Celebrity") from a mass tort action heard in the United States District Court for the Southern District of New York. The plaintiffs contend that we lack jurisdiction to hear the appeals because Essef did not file a notice of appeal within thirty days after judgment was entered as required by Fed.R.App.P. 4(a)(1). Essef relies on an extension of the time to file granted by the district court (James C. Francis IV, Magistrate Judge) under Fed. R.App.P. 4(a)(5) after the court found that the neglect that resulted in Essef's tardiness was excusable. The plaintiffs argue that Essef's neglect was not excusable and that the district court abused its discretion in holding otherwise. For the reasons set forth below, we agree with the plaintiffs.
In addition, Essef contends that the judgments appealed from did not become final and the time to appeal did not begin to run until the district court entered its Fed.R.Civ.P. 54(b) order on the docket in Silivanch, the "bellwether" case, which it did not do until after we held argument with respect to these motions. Essef bases this contention on the fact that although an order under Fed.R.Civ.P. 54(b), which directed that the judgment from which appeal was being sought was final and therefore appealable, was signed by the magistrate judge on January 25, 2002, and mailed to the parties, there was not then an entry in the docket for the "bellwether" action reflecting the issuance of the order. We conclude that the Rule 54(b) order was effective when it was signed and issued, even though it was not then entered in the "bellwether" action docket.
We therefore dismiss the appeals and cross-appeals for want of appellate jurisdiction.
The action before us arose from a 1994 outbreak of Legionnaires' Disease on board Celebrity's cruise ship Horizon. The United States Centers for Disease Control and Prevention traced the outbreak to the presence of legionella bacteria in filters designed, manufactured, and distributed by Essef that were operated in connection with the ship's whirlpool spa. Water from the spa passed through silica sand and gravel within the filters, cleansing it of hair, dirt, and oils. Beneath the gravel, each filter contained a hub from which "laterals" radiated like the spokes of a wheel. Filtered water returned to the spa via holes in the laterals.
The filters were designed to be cleaned by running them in reverse. Water was forced through the laterals and up through the gravel and sand, dislodging built-up waste material. Waste water from this "backwashing" process was then thrown overboard.
According to the evidence adduced at trial, the filters did not backwash properly. Instead of lifting the entire sand bed and cleansing each grain, water flowed primarily through the center of each filter and failed to clean the outer edges. As waste material built up in the filters, "biofilms" of organic material formed. These biofilms trapped the legionella inside the filters, protecting the bacteria from disinfectants while providing a growth medium. The bacteria proliferated. As water containing the bacteria was released back into the whirlpool, it was aerosolized and inhaled by passengers in and near the spa.
Many victims of the outbreak, their families, and their estates, including these plaintiffs, subsequently brought suit against Celebrity and Essef for their injuries and those of their relatives. Celebrity, in turn, filed cross-claims against Essef for indemnification and other damages.
By the end of 1995, at least twenty-two separate such actions had been filed. All of the related cases were assigned to United States District Judge Lawrence M. McKenna in the United States District Court for the Southern District of New York. Judge McKenna ordered the cases consolidated for discovery before Magistrate Judge Francis who, with the consent of the parties pursuant to 28 U.S.C. § 636(c), was later designated to conduct all proceedings in the matter, including the entry of final judgments. Over the next several years, discovery proceeded. During that period, some of the plaintiffs settled with Celebrity and Essef.
In May 2000, the remaining plaintiffs, Celebrity, and Essef agreed to resolve the entire matter before Magistrate Judge Francis using a "bellwether" procedure. One case — the "bellwether" — brought by John and Joyce Silivanch, would be tried to a jury on all issues. The jury would determine if Celebrity, Essef, or both were liable for the Silivanches' injuries. If the jury found such liability, it would determine each defendant's proportional liability and Celebrity's right of indemnification against Essef, if any, with regard thereto, in addition to the amount of the Silivanches' compensatory damages. It would also determine each defendant's liability for any punitive damages to all the plaintiffs as a group. The Silivanch jury's findings on all issues, other than proximate cause with respect to the Silivanches' injury and compensatory damages to be awarded to them, would be binding in all of the remaining cases, each of which would be tried separately on the reserved two issues. Any punitive damages awarded in the bellwether trial would be allocated by the court among the various plaintiffs.
In June 2000, the jury returned a verdict finding the defendants liable to the Silivanches. It also found that Essef had an obligation to indemnify Celebrity in full. The jury awarded $4,200,000 in punitive damages to the plaintiffs, and another $2,800,000 to Celebrity, all to be paid by Essef.
The remaining plaintiffs then settled or tried their cases on the issues of causation and compensatory damages. Afterward, the district court apportioned the punitive damages award among those plaintiffs who had established the requisite proximate causation at trial, or against whom such causation had not been contested because of definitive medical evidence.
In November 2001, the district court severed Celebrity's remaining claims against Essef, and, pursuant to Fed. R.Civ.P. 54(b),1 directed the clerk of the court to enter final judgment in, and close, some or all of the plaintiffs' cases. Supplemental judgments as to punitive damages were signed by the magistrate judge, issued, and docketed for each plaintiff who was awarded punitive damages.
Shortly thereafter, on December 7, 2001, however, the district court ordered the clerk to reopen the cases that had been closed because the supplemental judgments "in many of the related cases ... ha[d] not been forwarded to counsel, and certain parties ha[d] raised the issue of post-judgment interest." Order dated Dec. 7, 2001.
On January 25, 2002, after ruling on post-judgment interest, the magistrate judge signed a new Rule 54(b) order severing Celebrity's claims against Essef, and directing the entry of final judgment in favor of the plaintiff or plaintiffs in each case. The orders, highly similar although individualized for each set of parties, were mailed to counsel and entered on each docket except, inexplicably, the docket for Silivanch.
Also on January 25, 2002, the magistrate judge signed separate "Second Supplemental Judgments" ordering post-judgment interest...
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