Opposition Brief — Edenso v. Haida Corp., 114 S. Ct. 695 (1994) (No. 93-770)

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No. 93-770 | HOV 30 198

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In The i ‘

Suprene Court of the United States

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October Term, 1993

JIM EDENSO,

Petitioner,

vs.

HAIDA CORPORATION,

Respondent.

On Petition for a Writ of Certiorari to the United States Court

of Appeals for the Ninth Circuit

RESPONDENT?’S BRIEF IN OPPOSITION

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CABOT CHRISTIANSON

Counsel of Record

BUNDY & CHRISTIANSON

Attorneys for Respondent

911 West 8th Avenue, Suite 302

Anchorage, Alaska 99501

(907) 258-6016

(800) 3 APPEAL « (800) 5 APPEAL « (800) BRIEF 21

TABLE OF CONTENTS

Page

Haida Corporation’s Statement of the Case ............ 1

Reasons for Denyingthe Writ ...................... 2

WI ew hie oa whieh & Sua eee bee ew kien 5

TABLE OF CITATIONS

Cases Cited:

Alyeska Pipeline Service Co. v. Wilderness Society, 421

Si MOMENTO 6k caw dob endds Veda daédencceen. 3

Chambers v. NASCO, 894 F.2d 696 (5th Cir. 1990) ...... 4

' Chambers v. NASCO, 111S.Ct.2123(1991) .......... 4

; Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437

. PN thd Danan ete ee eee ee ee ae: 3

‘ Hanna v. Plummer, 380 U.S. 461 (1965) .............. 4

Pennsylvania v. Del. Valley Citizens Council, 478 U.S. 546

' PN aS ofS AER NACA chaos oud cok kek has xs a

.

Statutes Cited:

MO ter GRPIUM IY 6c cbc cnc dcncabidececbcceccus 4

ro See ed | 4

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Contents

Page

28 U.S.C. § L330 EZ) « « .65.004he en ee 3

SOUSL.§ 18S 2. 2500800008 00s eee 3

42 U.S.C. 94321 oo. cco csccacaceue eee 3

42 U.S.C. § 7401, et seq. OEP ETEET Tr ee oes 3

43 U.S.C. § 1601 ef amg. occ cc nnecsdaeneeeeeeee 2

Rules Cited:

Alaska Rule of Civil Procedure 82 ................... 1,2

Supreme Court Ruie29.1 ......s0s0s000ee ene eee 2

l

HAIDA CORPORATION’S' STATEMENT OF THE CASE

Jim Edenso’s Statement of the Case is generally accurate, but

is incomplete in one respect. In Edenso’s trial brief, filed

immediately before the commencement of the bankruptcy court

trial, Edenso outlined his claims. Part of his claim is $19,375.35 of

Alaska Rule of Civil Procedure 82 (“Rule 82”) attorney fees. His

trial brief opens with the following summary of his claim:

Creditor JIM EDENSO, is entitled to be

paid the following:

1. 7/03/84 corrected invoice (original,

dated June 12, 1984)

$103,316.17

2. Interest at ten and one-half percent

(10.5%) from July 3, 1984 to July 19,

1988, the effective date of HC Plan

43,868.34

3. Interest at six percent (6%) from July 19,

1988 to January 10, 1992. Per diem

interest runs at $16.98

_21,569.02

Subtotal $168,753.53

4. Civil Rule 82 contested attorney’s fees

on $168,753.53

$19,375.35

TOTAL = $188,128.88

1. Haida Corporation is a village corporation for the village of Hydaburg,

(Cont'd)

2

It was only after Edenso lost at trial that he took the position

that an award of Rule 82 attorney fees to the prevailing party in this

dispute is improper.

REASONS FOR DENYING THE WRIT

The courts below applied Alaska’s Rule of Civil Procedure 82?

to a dispute decided by a bankruptcy court entirely under Alaska

state law. No other state in the union has a comparable rule of civil

(Cont'd)

Alaska organized pursuant to the Alaska Native Claims Settlement Act, 43

U.S.C. § 1601 et seg. Haida Corporation has no corporate parent and no

nonwholly owned subsidiaries. Supreme Court Rule 29. 1.

2. Rule 82(a)(1), as then in effect, provided:

(1) Unless the court, in its discretion, otherwise directs, the following

schedule of attorney’s fees will be adhered to in fixing such fees for the party

recovering any money judgment therein:

Judgment

and, if

Awarded, Contested

Prejudgment Contested Without Non-

First $25,000 20% 18% 10%

Next $75,000 10% 8% 3%

Next $400,000 10% 6% 2%

Over $500,000 10% 2% 1%

Should no recovery be had, attorney’s fees may be fixed by the court in its

discretion in a reasonable amount.

3

procedure’. The issue presented herein can therefore arise only in

Alaska, and has no federal Significance.

Petitioner argued that Alyeska Pipeline Service Co. vy.

Wilderness Society, 421 U.S. 240 (1975); Pennsylvania v. Del.

Valley Citizens Council, 478 U.S. 546 (1986); Crawford Fitting

Co. v. J.T. Gibbons, Inc., 482 U.S. 437 (1987) supports his position.

Taken together, those cases stand for the proposition that in a case

decided under federal law, federal courts may not award attorney

fees to the prevailing party unless expressly authorized by federal

Statute or under circumstances not relevant to the case at bar (bad

faith, contempt of court, and recovery of acommon fund). Alyeska,

421 U.S. at 257-259.

Those cases were all brought under federal law. Alyeska was

brought under the Mineral Leasing Act of 1920, 30 U.S.C. § 185,

and the National Environmental Policy Act of 1969 (NEPA), 42

U.S.C. § 4321. Pennsylvania was brought under the Clean Air Act,

42 U.S.C. § 7401, et seg. Crawford Fitting was brought under

federal antitrust laws.

The instant dispute, in contrast, was decided entirely under

Alaska law. All the events giving rise to the dispute occurred prior

to Haida Corporation’s Chapter 11 filing. The only reason the

dispute was decided by the bankruptcy court instead of a state court

was that Petitioner had not filed a state court action by the time of

the petition. 28 U.S.C. § 1334(c)(2).

This Court has consistently recognized that when a federal

court decides a case under state law, the state law rule granting or

denying attorney fees will apply. For example, after setting forth,

in Alyeska, the general federal rule that absent Statutory

authorization, attorney fees are not awarded in federal court, this

3. Nor, to respondent’s knowledge, does any other state have any other

rule of general application which grants attorney fees to the prevailing party.

Court stated in footnote 31:

A very different situation is presented when a

federal court sits in a diversity case. “[I)n an

ordinary diversity case where the state law

does not run counter to a valid federal statute or

rule of court, and usually it will not, state law

denying the right to attorney’s fees or giving a

right thereto, which reflects a substantial

policy of the state, should be followed.” 6 J.

Moore, Federal Practice Para. 54.77 [2], pp.

1712-1713 (2ded. 1974)...

Petitioner attempts to wriggle out of this footnote 31 by

arguing that a federal rule of decision applies to this case because

the bankruptcy court had jurisdiction to hear the case.* However,

this jurisdictional grant is no more a “federal rule of decision” than

is a grant of diversity jurisdiction. The same considerations that led

this Court to use the state law rule for attorney fees where

substantive state law applies in a diversity case,’ should lead this

Court to conclude that the state law rule for attorney fees applies

where substantive state law applies in a bankruptcy case.

4. 28 U.S.C. § 157(b)(1) gives bankruptcy courts jurisdiction to hear core

proceedings. Under 28 U.S.C. § 157(b)(2)(B), core proceedings include claims

determinations.

5. To wit, “discouragement of forum shopping and avoidance of the

inequitable administration of the laws.” Hanna v. Plummer, 380 U.S. 461, 468

(1965), quoted in Chambers v. NASCO, 111 S. Ct. 2123, 2137 (1991). “Erie [v.

Thompkins, 304 U.S. 64 (1938)] guaranties a litigant that if he takes his state law

cause of action to federal court, and abides by the rules of that court, the result in

his case will be the same as if he had brought it in state court.” Chambers v.

NASCO, 894 F.2d 696, 706 (Sth Cir. 1990), quoted approvingly in Chambers v

NASCO, 111 U.S. at 2137.

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CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted,

CABOT CHRISTIANSON

BUNDY & CHRISTIANSON

Attorneys for Respondent

November 24, 1992