Stubblefield v. Windsor Capital Group

• Decision Date: 22 January 1996
• Docket Number: No. 95-1143,95-1143
• Citation: 74 F.3d 990
• Parties: 69 Fair Empl.Prac.Cas. (BNA) 1446, 67 Empl. Prac. Dec. P 43,905 Michael R. STUBBLEFIELD, Plaintiff-Appellant, v. WINDSOR CAPITAL GROUP; Michael Klingensmith, Defendants-Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 990

74 F.3d 990

69 Fair Empl.Prac.Cas. (BNA) 1446,

67 Empl. Prac. Dec. P 43,905

Michael R. STUBBLEFIELD, Plaintiff-Appellant, v. WINDSOR CAPITAL GROUP; Michael Klingensmith, Defendants-Appellees.

No. 95-1143.

United States Court of Appeals,

Tenth Circuit.

Jan. 22, 1996.

Submitted on the briefs. ^*

Penfield W. Tate III and Barbara J. Kelley of Tate Kelley & Tate, P.C., Denver, Colorado, for Plaintiff-Appellant.

Lawrence B. Leff of Winzenburg, Leff & Mitchell, Denver, Colorado, for Defendants-Appellees.

Before ANDERSON, BALDOCK and BRORBY, Circuit Judges.

BRORBY, Circuit Judge.

Plaintiff Michael R. Stubblefield was an employee of the Embassy Suites Hotel in Denver, Colorado. After he was terminated, Mr. Stubblefield brought this action against the owner of the hotel, Windsor Capital Group, and the hotel manager, Michael Klingensmith, alleging racial discrimination in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq., and other violations of federal and Colorado law. Approximately four weeks before the matter was set to go to trial, the defendants filed an offer of judgment pursuant to Fed.R.Civ.P. 68 "in the amount of $15,000.00 plus reasonable costs to date." ¹ However, defendants "reserve[d] the right to object to any costs in connection with the acceptance of th[eir] Offer of Judgment."

Mr. Stubblefield accepted the offer of judgment. In his written acceptance, he requested the district court enter judgment in his favor "in the amount of $15,000.00, plus his reasonable costs to date" and also that it "establish[ ] the time frame for submitting the requests for payment of his compensable and recoverable costs, which by law are to include reasonable attorney fees pursuant to his claims." The clerk of the district court entered judgment in Mr. Stubblefield's favor "in the amount of $15,000.00 plus reasonable costs to date."

Mr. Stubblefield later submitted a bill of costs requesting approximately $34,000 in attorney fees. In response, the defendants moved to alter or amend the judgment pursuant to Fed.R.Civ.P. 59(e) or, in the alternative, to vacate it pursuant to Fed.R.Civ.P. 60(b). Defendants asserted they had intended for the offer of judgment to satisfy all Mr. Stubblefield's claims, including his claim for attorney fees, and "if the language in the offer was not clear enough to encompass all claims, then the offer was made upon mistake; the omission of attorney fee language in the offer of judgment was inadvertent, or it was excusable neglect under the circumstances." To allow Mr. Stubblefield to collect attorney fees in addition to the $15,000 settlement, they contended, "would be a miscarriage of justice and defeat the purpose of an offer of settlement to resolve all issues."

The district court denied the motion to alter or amend the judgment pursuant to Fed.R.Civ.P. 59(e), but granted the motion to vacate the judgment pursuant to Fed.R.Civ.P. 60(b)(1) on the ground the judgment resulted from "mistake, inadvertence, surprise, or excusable neglect." The district court applied contract law principles and concluded the Rule 68 settlement agreement was void because there had been no "meeting of the minds" between Mr. Stubblefield and defendants. See Herrington v. County of Sonoma, 12 F.3d 901, 907 (9th Cir.1993) ("a court will ordinarily apply the usual rules of contract construction" to interpret Rule 68 settlement agreements); Radecki v. Amoco Oil Co., 858 F.2d 397, 400 (8th Cir.1988) ("[t]o decide whether there has been a valid offer and acceptance for the purpose of Rule 68, courts apply the principles of contract law"); Johnson v. University College of the Univ. of Ala., 706 F.2d 1205, 1209 (11th Cir.) (Rule 68 settlement agreement void unless there was a "meeting of the minds" under basic contract law principles), cert. denied, 464 U.S. 994 (1983). The district court reasoned as follows:

The offer itself makes no mention of attorney fees, yet it seems to contemplate that acceptance of the offer will fully resolve the Defendants' liability. The offer appears to be a lump-sum offer. The acceptance, on the other hand, is not unequivocal. The acceptance adds a request that the court interpret the offer of judgment as including attorney's fees. A purported acceptance that contains different or additional material terms is not a valid acceptance, but should be treated as a rejection of the offer and as a counteroffer. The inclusion of attorney's fees in the amount of $33,772.75 in a case worth only [$15,000.00] can fairly be understood as a material change to the terms of the offer. In addition, attorney's fees in the amount of $33,772.75 in a $15,000.00 case do not appear consistent with the surrounding circumstances, the purposes, and the objects of this agreement.

Having concluded the settlement agreement was void, the district court vacated the judgment and scheduled both a settlement conference and a jury trial.

Mr. Stubblefield asked the district court to certify its decision for immediate appeal pursuant to 28 U.S.C. Sec. 1292(b). ² Before the district court ruled on the motion, Mr. Stubblefield noticed an appeal from the order granting defendants' Rule 60(b) motion. The district court later denied Mr. Stubblefield's motion for certification as moot. On our own motion, we ordered the parties to show cause why the appeal should not be summarily dismissed for lack of jurisdiction under 28 U.S.C. Sec. 1291. See 10th Cir.R. 27.2.2. After reviewing the parties' responses, we conclude we lack jurisdiction. ³

I

The general rules governing our review of a district court's order granting or denying a Rule 60(b) motion are fairly well settled. We have jurisdiction under 28 U.S.C. Sec. 1291 to reach the merits of an appeal from a denial of a Rule 60(b) motion, provided the ruling or judgment the Rule 60(b) motion challenged was a "final decision[ ] of the district court[ ]." See Van Skiver v. United States, 952 F.2d 1241, 1243 (10th Cir.1991), cert. denied, 506 U.S. 828, 113 S.Ct. 89, 121 L.Ed.2d 51 (1992); Kerwit Med. Prods. v. N. & H. Instruments, Inc., 616 F.2d 833 (5th Cir.1980) (court of appeals lacks jurisdiction under 28 U.S.C. Sec. 1291 to decide the merits of an appeal from a denial of a Rule 60(b) motion unless the challenged decision was final and appealable). See generally 7 J. Moore, Federal Practice p 60.30, pp. 343-47. However, an appeal from a denial of a Rule 60(b) motion normally " 'raises for review only the district court's order of denial and not the underlying judgment itself.' " Elsken v. Network Multi-Family Sec. Corp., 49 F.3d 1470, 1476 (10th Cir.1995) (quoting Van Skiver, 952 F.2d at 1243). See Bud Brooks Trucking, Inc. v. Bill Hodges Trucking Co., 909 F.2d 1437, 1439-40 & n. 3 (10th Cir.1990). But see V.T.A., Inc. v. Airco, Inc., 597 F.2d 220, 223-24 & n. 8 (10th Cir.1979) (if the Rule 60(b) motion asserted the judgment was void, the court of appeals must "evaluate the validity of the underlying judgment in reviewing the order denying the motion"). We also have jurisdiction under 28 U.S.C. Sec. 1291 to review an order granting a Rule 60(b) motion, if at some point after granting the motion, the district court entered a "final decision[ ]" resolving the litigation on the trial court level. See, e.g., Orner v. Shalala, 30 F.3d 1307 (10th Cir.1994); Oklahoma Radio Assocs. v. F.D.I.C., 987 F.2d 685, 696-97 (10th Cir.1993).

We usually review a district court's decision to grant or deny a Rule 60(b) motion for abuse of discretion. F.D.I.C. v. Oldenburg, 38 F.3d 1119, 1123 (10th Cir.1994) (denial of Rule 60(b) motion is reviewed for abuse of discretion), cert. denied, --- U.S. ----, 116 S.Ct. 171, 133 L.Ed.2d 112 (1995); Oklahoma Radio, 987 F.2d at 697 (grant of Rule 60(b) motion is reviewed for abuse of discretion). But see Wilmer v. Board of County Comm'rs, 69 F.3d 406, 409 (10th Cir.1995) (district court's determination whether judgment is void under Rule 60(b)(4) for lack of subject matter jurisdiction is reviewed de novo) (citing King Fisher Marine Serv., Inc. v. 21st Phoenix Corp., 893 F.2d 1155, 1158 (10th Cir.), cert. denied, 496 U.S. 912, 110 S.Ct. 2603, 110 L.Ed.2d 283 (1990)). In deciding whether the district court abused its discretion, we remain mindful "[r]elief under Rule 60(b) is extraordinary and may only be granted in exceptional circumstances." Bud Brooks Trucking, 909 F.2d at 1440. See Pelican Production Corp. v. Marino, 893 F.2d 1143, 1146-47 (10th Cir.1990) (discussing some of the criteria used to determine whether ruling on a Rule 60(b) motion was an abuse of discretion).

The district court order Mr. Stubblefield now appeals does not fall into either of the two established categories discussed above. In this case, the district court granted defendants' Rule 60(b) motion, voided the Rule 68 settlement agreement, and vacated the judgment. Mr. Stubblefield concedes, and we agree, the Sixth Circuit's decision in Mallory v. Eyrich, 922 F.2d 1273 (6th Cir.1991), is the only case addressing whether such an order is immediately appealable under 28 U.S.C. Sec. 1291.

In Mallory, the Sixth Circuit concluded an order granting a Rule 60(b) motion and vacating a judgment entered pursuant to a Rule 68 settlement agreement is immediately appealable. It began by citing Honneus v. Donovan, 691 F.2d 1, 2 (1st Cir.1982), and certain dictum in Browder v. Director, Dept. of Corrections of Illinois, 434 U.S. 257, 263 n. 7, 98 S.Ct. 556, 560 n. 7, 54 L.Ed.2d 521 (1978), for the proposition "[t]he law is settled that a ruling on a Rule 60(b) motion may be appealed under Fed.R.App.P. 4(a)," regardless, apparently, of whether the district court granted or denied the motion. Mallory, 922 F.2d at 1277. In the alternative, it concluded even if the order granting the Rule 60(b) motion was not final within the meaning of 28 U.S.C. Sec. 1291, it had jurisdiction to review that order under the "marginal" or "practical" finality doctrine of...