As attorneys, one of our greatest skill sets is problem-solving for our clients. For appellate attorneys, those skills can be pushed to the limit when we are retained after an adverse judgment or adverse jury verdict and our client turns to us hoping to repair or reverse the damage. When a client seeks to appeal an adverse judgment, in addition to the typical questions regarding timing, filing of the notice of appeal, and whether an appeal is even meritorious, another question should be added to your checklist: Would the indicative ruling provisions of Federal Rule of Civil Procedure 62.1 and Federal Rule of Appellate Procedure 12.1 be appropriate here?
How the Indicative Ruling Process Works
Rule 62.1 and its appellate counterpart, Rule 12.1, work in tandem to enable the district court, after it has lost jurisdiction due to a pending appeal, to advise on an unresolved issue with the appellate court’s consent. It also conserves judicial and client resources by streamlining the issues that will ultimately be heard by the appellate court. The text of Rule 62.1 is fairly straightforward: “If a timely motion is made for relief that the court lacks authority to grant because of an appeal that has been docketed and is pending, the court may: (1) defer considering the motion; (2) deny the motion; or (3) state either that it would grant the motion if the court of appeals remands for that purpose or that the motion raises a substantial issue.” Fed. R. Civ. P. 62.1(a). If the district court takes option 3 and determines that it would either grant the motion or that it raises a substantial issue, the movant must notify the appellate court clerk. Id. at 62.1(b); Fed. R. App. P. 12.1(a). At that point, the appellate court may grant a limited remand for the district court to consider the motion while retaining jurisdiction over the pending appeal.
Adopted in 2009, the indicative ruling process outlined in Rules 62.1 and 12.1 codified what had largely been the practice in district and appellate courts when confronted with Rule 60(b) motions for relief from judgment during a pending appeal. For the history and evolution of these rules, see 16A Wright & Miller, Federal Practice and Procedure § 3958.10 (5th ed. 2020). In such instances, a judgment had been entered, the notice of appeal filed, and the case brought before the circuit court, but an issue arose before the district court that could affect the case as a whole then on appeal.
One such case where the indicative ruling process was used to great effect was Hutchison v. Parent, 773 F. App’x 288 (6th Cir. 2019), in the Northern District of Ohio and the U.S. Court of Appeals for the Sixth Circuit. The case involved a business dispute that resulted in a multimillion-dollar jury verdict with $1.135 million in punitive damages against the defendant. Both parties filed several post-judgment motions including defendant’s motions for judgment as a matter of law and for a new trial, and plaintiff’s motions for attorney fees, prejudgment interest, and costs. Before those motions were disposed of, the defendant filed a timely notice of appeal. As a result, under Fed. R. App. P. 4(a)(4), the notice of appeal became effective and vested the appellate court with jurisdiction once the district court resolved the last of the post-judgment motions.
At this point, defendant’s appellate counsel was brought into the fold and noticed a glaring issue: The tort claims underlying the adverse judgment had been litigated pursuant to Indiana substantive law while the litigation proceeded pursuant to Ohio procedural law, but the district court never declared which punitive damages regime applied to plaintiff’s award. The judgment itself was silent on the issue.
In enacting recent tort reform measures, both states had placed limitations on the amount of punitive damages a successful party could recover. On the one hand, Indiana had adopted a split-recovery statute whereby 25 percent of the punitive damages award went to the plaintiff while the remaining 75 percent went to the Indiana state treasurer. Importantly, however, Indiana case law indicated that the parties were free to enter into their own post-judgment settlement prior to application of the statute to the punitive damages award. On the other hand, Ohio had adopted a system that would have capped punitive damages in this case at $350,000. One of the two limitations on punitive damages had to apply, but it remained unclear which one. Thus, an issue that would unquestionably affect the ultimate amount of damages at stake in the case and potentially lead to further settlement negotiations remained unresolved while the case was already pending before the Sixth Circuit.
The defendant’s appellate counsel therefore filed a Rule 62.1 motion seeking clarification from the district court as to which punitive damages regime should apply. Pursuant to Rule 62.1(a)(3), the district court ruled that the motion raised a substantial issue. Hutchison v. Parent, No. 3:12-cv-320, 2017 WL 2797418 (N.D. Ohio June 28, 2017). The appellate court agreed and issued a limited remand for the district court to make a proper determination. The district court then ruled that Ohio’s punitive damages cap should apply. Hutchison v. Parent, No. 3:12-cv-320, 2018 WL 1468823 (N.D. Ohio March 26, 2018). Following an additional notice of appeal, that choice-of-law issue was incorporated into the issues previously raised on appeal. Ultimately, with all the outstanding issues before it, the Sixth Circuit reversed the judgment against the defendant on separate, res judicata grounds, and directed entry of judgment in favor of the defendant.
Although the choice-of-law issue regarding punitive damages became a moot point, the streamlining of the issues presented on appeal, the avoidance of potentially piecemeal appeals, and the additional opportunity for informed settlement negotiations together left no stone unturned and were no doubt the prudent strategy.
Best Practices to Follow
When faced with a complex appeal, every litigator should similarly ask whether Rule 62.1 and Rule 12.1 are appropriate tools for resolving an outstanding issue in their case. The following considerations can help you make a successful strategic decision:
- Determine whether a notice of appeal and post-judgment motions have been filed, making Rule 62.1 an appropriate mechanism compared to other post-judgment motions;
- Consider whether the relief being sought is significant and meritorious enough that a ruling on the issue from the district court prior to the appeal will have a substantial effect—for example, is there an unresolved issue in the district court’s judgment, is there new evidence, or is there another matter that would assist the court of appeals if it were first clarified by the district court;
- Request that the appellate court grant only a limited remand so as not to endanger your timely filed prior notice of appeal;
- File a subsequent notice of appeal if your motion for an indicative ruling is unsuccessful.
Michael K. Robertson is a partner at Taft, Stettinius & Hollister in Columbus, Ohio, and U.S. diplomat currently living in Bulgaria where his wife serves on a diplomatic mission at the U.S. Embassy in Sofia.
Note: The author and his law firm represented the defendant on the appeal in the Hutchison case discussed in this Practice Point. A different law firm represented the defendant at the trial court level.
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