Opposition Brief — Alcan Aluminum Corp. v. Prudential Assurance Co.

SUPPETHCS UME, UD.

| - FILED

| MAY 29 20

No. 01-1594 ' ommich Ob TAR OLERK

IN THE

Supreme Court of the United States

ALCAN ALUMINUM CORPORATION,

Petitioner,

v,

PRUDENTIAL ASSURANCE COMPANY LIMITED, et al.,

Defendants,

-and-

CERTAIN UNDERWRITERS AT LLOYD’S OF LONDON,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UnitTep STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

BRIEF IN OPPOSITION FOR RESPONDENT

CERTAIN UNDERWRITERS AT LLOYD’S

OF LONDON

Jay R. SEVER H. ALSTON JOHNSON, III

MakIAN T. HARRISON Counsel of Record

365 Canal Street PHELes DunBAR LLP

Suite 2000 445 North Boulevard

New Orleans, LA 70124 Suite 701

(504) 566-1311 Baton Rouge, LA 70802

- (225) 346-0285

Attorneys for Respondent

174192 ce

COUNSEL PRESS

(800) 274-3321 * (800) 359-6859

i

QUESTIONS PRESENTED

(1) Is there a compelling reason to grant a petition for

writ of certiorari where the issues involved are of no

consequence beyond the petitioner’s monetary self-interest?

(2) Did the District Court properly tax against Alcan the

costs of Underwriters’ supersedeas bond pending Alcan’s

appeal?

(3) Did Alcan establish that the District Court Clerk’s

Office was “inaccessible” on the day after Thanksgiving or

that the day after Thanksgiving is declared a holiday in

California?

ll

2 TABLE OF CONTENTS

Questions Presented oo... cic cccesescccssccass

Table of Comet oon cack eens

Table of Cited Authorities .....................

Statement of Jurisdiction ..................05.

Statement of Cube ois accu oe ee ese ak.

Cinsificetiom. .....acananaee ee ree

Reasons for Denying the Writ ..................

I.

Alcan Fails To Raise An Important Federal

Question Or Articulate A Compelling Reason

To Justify Discretionary Review By This

Comet. ..<000c¢e cee aera seeks es

The District Court Properly Taxed

Underwriters’ Bond Costs Against Alcan. ..

The Issue Of Whether Alcan Timely Filed Its

Appeal Does Not Warrant This Court’s

ROVONM, .. . inc ccanQeanee eee rhea sees ss

Post-Judgment Interest Did Not Accrue

During The Pendency Of Alcan’s Appeal

Because The Execution Of The Judgment

Was Automatically Stayed. ..............

Page

10

lil

Contents

Page

V. The Date Of The Amended Judgment Is The

Correct Inception Date For The Accruement

Of Post-Judgment Interest. .............. 12

es dee ekeneeee eee 13

iv

TABLE OF CITED AUTHORITIES

Page

Cases: .

Bronson vy. LaCrosse & M. R. Co., 68 U.S. 405,

17 L. Ed. 616, 1 Wall 405 (1863) ............. 2, 11

Budinich v. Becton Dickinson & Co., 486 U.S. 196,

108 S. Ct. 1717, 100 L. Ed. 2d 178 (1988) ..... 10

Enserch Corp. v. Shand Morahan & Co., Inc.,

918 P26 SG2 CG Cae, FOGG) cnn ccc cee eesas, 11,12

Keyser v. Sacramento City Unified Sch. Dist.,

pe we, ee er rere 9

Layne & Bowler Corp. v. Western Well Works, Inc.,

261 U.S. 387, 43 S. Ct. 422, 67 L. Ed. 712 (1923)

EP eh SRP ey yee IP en Ferre 7

Rice v. Sioux City Memorial Park Cemetery, Inc.,

349 U.S. 70, 75 S. Ct. 614, 99 L. Ed. 897 (1955)

va Raw ee Kee ee EO a a 7

United States v. Stringfellow, 1993 WL 565393

CP Ce, TP) os sc ee iv ee ts arena wanes l

Statutes:

mUGH SS. Ge

muse 11 12

v

Cited Authorities

Page

Rules:

Fed. R. App. P. 26(a)(3) 0.2... eee ee eee eens 4,9

Fed. R. App. P. 26(a)(4) ........-ee eee e eee eeee 4,9

Fed. R. App. P. 39(8) 2.2... cece cee cece es ceeee 9

Fat R.A EMO ois ire 6,8

U.S. Sap. Ct. Rule 10 o.oo ccc ccna 6, 7, 10

U.S. Sup. Ct. Rule 15(2) .......... cee sence ees 5

Local Rule 16.4.15 for the United States Central

District of Califormia ............2.eeeeeeeee 6

oe

l

STATEMENT OF JURISDICTION

The United States Court of Appeals for the Ninth Circuit

(“Ninth Circuit”) entered its judgment on January 24, 2002.

Alcan Aluminum Corporation (“Alcan”) filed its petition for

writ of certiorari on April 23, 2002 and the matter was placed

on the docket on April 29, 2002. Alcan asserts jurisdiction

in this Court based on 28 U.S.C. § 1257(a).

STATEMENT OF CASE

This case arises from an insurance coverage dispute

between Alcan and its primary and excess insurers regarding

Alcan’s coverage for liability Alcan incurred in the United

States v. Stringfellow and Newman v. Stringfellow lawsuits.

Plaintiffs in those lawsuits sued Alcan because of its disposal

activities at the Stringfellow Acid Pit Site in Riverside,

California (“Stringfellow Site”). In 1995, Alcan filed suit

against certain of its insurers seeking recovery of defense

costs and indemnity payments incurred due to the United

States v. Stringfellow and Newman v. Stringfellow claims."

On June 19, 1997, the United States District Court for

the Central District of California (“District Court”) entered

judgment in favor of Alcan against Underwriters for

$1,544,302.53. On July 18, 1997, the District Court entered

an amended judgment which was, as to the issues presently

before this Court, identical to the June 19, 1997 judgment.

1. The underlying lawsuits involved numerous claims for

property damage and bodily injury allegedly caused by hazardous

materials disposed of at the Stringfellow Site.

2

On August 1, 1997, Alcan appealed various rulings of

the District Court’s July 18, 1997 amended judgment to the

Ninth Circuit. In particular, Alcan sought an increase in the

amount of the judgment rendered against Underwriters.

Because Alcan, the prevailing party, had appealed the District

Court’s judgment, Underwriters asserted that the execution

of the judgment was automatically stayed and cited the United

States Supreme Court decision, Bronson v. LaCrosse &

M. R. Co.’ The District Court disagreed with Underwriters’

assertion and ordered Underwriters to pay the judgment on

October 6, 1997. In response, Underwriters posted a

supersedeas bond in the amount of $1,132,341.06 (which

reflects the gross judgment of $1,544,302.53 less the

proportionate share of insolvent non-represented companies)

on November 21, 1997. Alcan was dissatisfied with the

supersedeas bond and threatened to executeon the judgment.

Thus, Underwriters filed an ex parte motion Seeking

clarification that Underwriters were entitled to post a

supersedeas bond under the District Court’s October 6, 1997

order. On November 24, 1997, the District Court granted

Underwriters’ ex parte motion and allowed the posting of

the bond.

Alcan appealed the District Court’s November 24, 1997

ruling to the Ninth Circuit, asserting that the District Court

had erred in allowing Underwriters to post a supersedeas

bond. On March 31, 1999, the Ninth Circuit held that

execution of the District Court’s July 18, 1997 judgment was

automatically stayed because Alcan, as the prevailing party,

had appealed the District Court’s judgment. In addition, the

Ninth Circuit found that Underwriters should not have been

2. 68 U.S. 405, 17 L. Ed. 616, 1 Wall 405 (1863).

3

required to post a supersedeas bond. In particular, the Ninth

Circuit stated, in pertinent part:

[O]nce Alcan filed its appeal challenging the

merits of the district court’s allocation order, the

execution of the judgment against its insurers was

automatically stayed. ... The supersedeas bond

actually provided Alcan protection that it was not

entitled to because a bond was not required to stay

the execution of the judgment in this case.’

Based on the Ninth Circuit’s opinion that the District

Court’s judgment had been automatically stayed by Alcan’s

appeal, Underwriters filed a Motion for Adjustment of Post-

Judgment Interest in the District Court on July 27, 1999.

Underwriters argued that post-judgment interest should not

have accrued during the time period of Alcan’s appeal because

the judgment was automatically stayed during the pendency

of that appeal. Underwriters also argued that the inception

of post-judgment interest should be the entry date of the

District Court’s amended judgment (July 18, 1997).

In response, Alcan asserted that Underwriters should not

benefit from the Ninth Circuit’s judgment because

Underwriters did not appeal the order regarding the posting

of the supersedeas bond.

On August 23, 1999, the District Court granted

Underwriters’ motion and held in pertinent part that: (1) the

proper post-judgment interest inception date is July 18, 1997;

(2) post-judgment interest is owed from July 18, 1997 (date

of the amended judgment) to August 1, 1997 (date Alcan

3. Alcan Aluminum Corp. v. Prudential, et al., 173 F.3d 859,

1999 WL 201610 (9th Cir 1999), p. 4.

4

filed its appeal) and from August 2, 1999 (date the Ninth

Circuit’s mandate was filed and spread in the District Court)

until the date the judgment is paid; and (3) post-judgment

interest did not accrue during the pendency of Alcan’s appeal

because the appeal resulted in an automatic stay of the District

Court’s judgment.

On. November 29, 1999 (the Monday after Thanksgiving

day), Alcan filed its Notice of Appeal on the post-judgment

interest issues. On January 24, 2002, the Ninth Circuit held

that Alcan’s appeal on this issue was untimely and, thus, that

it had no jurisdiction to hear the appeal because the timely

filing of a notice of appeal is “mandatory and jurisdictional.”

Alcan’s appeal was untimely because the Notice of

Appeal was due on November 26, 1999, the Friday after

Thanksgiving, and Alcan filed its Notice of Appeal on

November 29, 1999, the Monday after Thanksgiving.

The Ninth Circuit ruled that Alcan’s appeal was not timely

filed because it was filed three days late and because Alcan

failed to show that the District Court Clerk’s Office was

“inaccessible” on the day the appeal was due (the Friday after

Thanksgiving) or that the Friday after Thanksgiving was

“declared a holiday” in California.‘ On this Court, Alcan

seeks review of this ruling and of the post-judgment interest

issues.

On August 11, 1999, Underwriters filed a Bill of Costs

with the Clerk of Court to recover the bond premiums they

had paid to post the supersedeas bond. The Clerk of Court,

however, denied Underwriters’ Bill of Costs. Underwriters

then filed a motion with the District Court to reverse the

Clerk of Court’s ruling, asserting that the federal and local

rules of Civil Procedure provide that premiums paid for a

4. Fed. R. App. P. 26(a)(3) and (4).

5

supersedeas bond should be taxed in favor of the prevailing

party. On December 6, 1999, the District Court ruled in

Underwriters’ favor and ordered Alcan to pay Underwriters’

bond costs. Alcan also appealed this ruling to the Ninth

Circuit. On January 24, 2002, the Ninth Circuit affirmed the

District Court’s judgment awarding Underwriters their

supersedeas bond costs. The Ninth Circuit held that because

the District Court’s July 18, 1997 judgment was automatically

stayed during the pendency of Alcan’s appeal: (1) Alcan

had no right to force Underwriters to pay the judgment;

(2) Underwriters were not required to post the bond; and

(3) the bond actually served to protect Alcan’s interests.°

Alcan also seeks review of this ruling.

CLARIFICATION

Counsel are obligated to advise this Court of any

perceived misstatements of the law or fact made in petition

for writ of certiorari.© Accordingly, Underwriters note the

following.

Alcan asserts that the Ninth Circuit “created a new right

in the district court to permit it to assign costs of the insurer’s

bond... .” The District Court’s order requiring that Alcan

pay Underwriters’ bond costs is based on local court rules

and the Federal Rules of Appellate Procedure, which provide

5. Alcan Aluminum Corp. v. Prudential, et al., 173 F.3d 859,

- 1999 WL 201610, p. 4 (9th Cir. 1999). (“The supersedeas bond

actually provided Alcan protection that it was not entitled to because

a bond was not required to stay execution of the judgment in this

case.”)

6. U.S. Sup. Ct. Rule 15(2).

ii eee, eee

6

that costs on appeal, including premiums paid for a

supersedeas bond, are taxable for the benefit of the party

entitled.’

REASONS FOR DENYING THE WRIT

I. Alcan Fails To Raise An Important Federal Question

Or Articulate A Compelling Reason To Justify

Discretionary Review By This Court.

Supreme Court review on a writ of certiorari is a matter

of judicial discretion, which is granted only for “compelling”

reasons.® Under U.S. Sup. Ct. Rule 10, there are certain

factors which the Supreme Court considers in determining

whether to grant a petition for writ for certiorari. In sum,

these factors include: (1) whether either a United States Court

of Appeal or a state court of last resort has entered

a conflicting decision on the same important matter;

(2) whether such a decision has so far departed from the

accepted and usual course of judicial proceedings or

sanctioned such a departure by a lower court as to call for an

exercise of the Supreme Court’s supervisory powers;

(3) whether a court has decided an important question of

federal law that has not been, but should be, settled by the

Supreme Court; or (4) whether a court has decided an

important federal question in a way that conflicts with

relevant decisions of the Supreme Court. U.S. Sup. Ct. Rule

10 further provides that “[a] petition for writ of certiorari is

7. Fed. R. App. P. 39(e) and Local Rule 16.4.15 for the United

States Central District of California.

8. U.S. Sup. Ct. Rule 10, 28 U.S.C.A.

-

rarely granted when the asserted error consists of erroneous

factual findings or the misapplication of a properly stated

rule of law.”

Alcan’s petition fails to: (1) meet any of the criteria set

forth by Sup. Ct. Rule 10; (2) raise any compelling reason

for review of the Ninth Circuit’s judgment by this Court; or

(3) present an important federal question. Indeed, the Ninth

Circuit’s judgment does not conflict with the decision of

another United States court of appeals, a state court of last

resort or with a decision of this Court.

With regard to whether a petition for writ of certiorari

should be granted, this Court has stated the following:

° [I]t is very important that we be consistent in not

granting the writ of certiorari except in cases

involving principles the settlement of which is of

importance to the public, as distinguished from

the parties, and in cases where there is a real and

embarrassing conflict of opinion and authority

between the Circuit Courts of Appeals.’

¢ [T]his Court does not sit to satisfy a scholarly

interest... . Nor does it sit for the benefit of

particular litigants.'°

9. Rice v. Sioux City Memorial Park Cemetery, Inc. 349 US.

70, 79, 75 S. Ct. 614, 619-620, 99 L. Ed. 897 (1955), citing Layne &

Bowler Corp. v. Western Well Works, Inc., 261 U.S. 387, 393, 43

S. Ct. 422, 423, 67 L. Ed. 712 (1923).

10. Id., 349 U.S. at 74, 75 S. Ct. at 616 (citations omitted). —

8

Alcan has failed to present a compelling reason for this

court to exercise its discretionary judicial review as Alcan

seeks review of issues, which are of no significance to the

public, but rather are of consequence only to Alcan’s own

monetary interest. Specifically, Alcan seeks review of the

Ninth Circuit’s rulings that Alcan was obligated to pay

Underwriters’ bond costs and that Alcan’s Notice of Appeal

was not timely filed. Although not addressed by the Ninth

Circuit, Alcan also seeks review of the District Court’s

judgment that post-judgment interest accrued from the date

of the amended judgment (July 18, 1997) and that post-

judgment interest did not accrue during the pendency of

Alcan’s appeal. These rulings obviously have no precedential

value to warrant this Court’s discretionary review. In addition,

it is evident that the outcome of the issues Alcan appeals

lack national significance. The outcome of the issues will

only affect whether Alcan is obligated to pay Underwriters’

bond costs, whether Alcan timely filed its appeal on the post-

judgment interest issues and whether post-judgment interest

was properly calculated.

Il. The District Court Properly Taxed Underwriters’

Bond Costs Against Alcan.

Alcan seeks review of the Ninth Circuit’s ruling affirming

the District Court’s taxing of Underwriters’ bond costs against

Alcan. Federal Rule of Appellate Procedure 39(e) provides

that “. . . costs on appeal are taxable in the district court for

the benefit of the party entitled to costs under this rule. . . .”

This rule includes premiums paid for a supersédeas bond."

The plain language of Rule 39(e) shows that the taxation of

costs is mandatory. In addition, Federal Rule of Appellate

11. Fed. R. of App. P. 39(e).

9

Procedure 39(a) provides, in effect, that the prevailing party

is entitled to costs, i.e. “if a judgment is affirmed, costs are

taxed against the appellant.” Because the insurers, including

Underwriters, prevailed at the Ninth Circuit, they were clearly

entitled to costs. In fact, the Ninth Circuit expressly stated

that “[c]osts are awarded to defendants-appellees General,

Lloyd’s, Home and Continental.”

The taxing of Underwriters’ bond costs against Alcan is

further supported by the Ninth Circuit’s ruling that

Underwriters were not required to post the bond.'? Based on

the foregoing, it is clear that bond costs were properly

awarded to Underwriters and that this issue does not require

this Court’s review.

III. The Issue Of Whether Alcan Timely Filed Its Appeal

Does Not Warrant This Court’s Review.

It is undisputed that Alcan filed its appeal three days

late. The only issue before the Ninth Circuit was whether

‘ Alcan established that the District Court Clerk’s Office was

“inaccessible” on the day after Thanksgiving (November 26,

1999) when the appeal was due or whether that day was

“declared a holiday” in California.'* The lower court’s

findings that the Clerk’s Office was not “inaccessible” and

that the day after Thanksgiving was not “declared a holiday”

are factual findings, which cannot be reversed absent a

12. Alcan, 173 F.3d 859, 1999 WL 201610 at p. 4.

13. Id.

14. Fed. R. App. P. 26(a)(3) and (4); Keyser v. Sacramento City

Unified Sch. Dist., 265 F.3d 741 (9th Cir. 2001).

“——

10

conclusion that the factual findings are clearly erroneous.

According to Sup. Ct. Rule 10, “a petition for writ of

certiorari is rarely granted when the asserted error consists

of erroneous factual findings or the misapplication of a

properly stated rule of law.” On this basis alone, this Court

should decline to review this issue.

Further, the lower courts’ conclusion that Alcan failed

to show that the Clerk’s Office was “inaccessible” on the

day after Thanksgiving when the appeal was due or that the

day was “declared a holiday” in California is supported by

the record and is not clearly erroneous. This Court has held

that a court of appeals is without jurisdiction to review the

merits of a case, where the notice of appeal was not timely

filed.'5 Thus, the Ninth Circuit correctly dismissed Alcan’s

appeal on the post-judgment interest issues.

IV. Post-Judgment Interest Did Not Accrue During The

Pendency Of Alcan’s Appeal Because The Execution

Of The Judgment Was Automatically Stayed.

Even if Alcan’s appeal had been timely filed,

Underwriters would have prevailed on the merits. Alcan

asserts that it has been penalized for appealing the District

Court’s judgment by the denial of post-‘udgment interest

during the pendency of its appeal. The Ninth Circuit,

however, ruled that the execution of the District Court’s

judgment was automatically stayed by Alcan’s appeal of that

judgment.'* In so holding, the Ninth Circuit relied on a

15. Budinich v. Becton Dickinson & Co., 486 U.S. 196, 108

S. Ct. 1717, 100 L. Ed. 2d 178 (1988).

16. Alcan, 173 F.2d 859, 1999 WL 201610 at p. 4.

11

decision of this Court, Bronson v. La Crosse & M. R. Co.,

which closely resembles this case in that an appeal was filed

by victorious plaintiffs.’ In Bronson, this Court stated that

because the plaintiffs had appealed the judgment, “it would

be against all reason and principle to permit them to proceed

in the execution of it, pending the appeal.” '* This Court also

specifically stated that “(t]he appeal suspends the execution

of the decree.” '? Accordingly, because execution of the

judgment was suspended and post-judgment does not accrue

on a judgment that is not due, the District Court properly

ruled that post-judgment interest did not accumulate during

the pendency of Alcan’s appeal.

Alcan asserts that the United States Court of Appeals

for the Fifth Circuit’s decision in Enserch Corp. v. Shand

Morahan & Co., Inc. conflicts with the lower courts’ ruling

that Alcan’s appeal suspended execution of the judgment.”

In actuality, that decision is not in conflict. Rather, the

Enserch decision more narrowly interprets Bronson. In

particular, the Fifth Circuit concluded that “Bronson suggests

that a lower court judgment may be suspended without

bond when the relief sought by the prevailing party on appeal

is inconsistent with enforcement of the lower court’s

judgment.”' The relief sought by Alcan in the underlying

appeal was inconsistent with the District Court’s judgment.

17. 68 U.S. 405, 17 L. Ed. 616, 1 Wall. 405 (1863).

18. 68 U.S. {1 Wall) at 409-410.

19. Id. at 410

20. 918 F.2d 462 (Sth Cir. 1990)

21. 918 F.2d at 464.

12

In particular, Alcan appealed the District Court’s allocation

ruling, alleging that the District Court’s decision was legally

unfounded and should be reversed. For this reason, enforcement

of the judgment would have been inconsistent with the relief

sought in Alcan’s appeal. As such, even under Enserch, Alcan’s

appeal effected an automatic stay of the judgment against

Underwriters and Underwriters were not required to post a bond.

Thus, it is clear that Enserch does not conflict with the ruling at

issue here.

Based on the foregoing, it is evident that the District Court’s

ruling is not in conflict with a decision of any court and that the

result of Alcan’s appeal has no significance beyond Alcan’s

monetary self-interest. Thus, this issue does not merit review.

V. The Date Of The Amended Judgment Is The Correct

Inception Date For The Accruement Of Post-Judgment

Interest.

Under 28 U.S.C. § 1961(a), “interest shall be calculated

from the date of entry of judgment.” While the District Court

initially entered judgment on June 19, 1997, that judgment was

clarified and the amended judgment was entered on July 18,

1997. Because the amended judgment was entered on July 18,

1997, that is the earliest date from which post-judgment interest

can accrue. Thus, the District Court correctly ruled that post-

judgment interest began accumulating on July 18, 1997. Because

the lower court’s conclusion on this issue was correct and the

result is only of consequence to Alcan, this Court should decline

to review it.

13

CONCLUSION

Alcan has fallen well short of articulating a compelling

reason to justify the exercise of this Court’s discretionary

review. The issues involved have no importance beyond

Alcan’s monetary self-interest. The lower courts’ rulings do

not conflict with a decision of this court. The rulings have

no precedential value and do not affect any matter of public

consequence. Alcan’s petition should be denied.

Respectfully submitted,

H. AtsTon Jounson, Ii

Counsel of Record

PHELPs DUNBAR LLP

445 North Boulevard

Suite 701

Baton Rouge, LA 70802

(225) 346-0285

Jay R. SEVER

MakRIAN T. HARRISON

365 Canal Street

Suite 2000

New Orleans, LA 70124

(504) 566-1311

Attorneys for Respondent