# Appendix — Bernback v. Greco

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386007_1628%3A2

## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 2005
- **Citation:** 546 U.S. 935

## Text

la

UNITED STATES COURT OF APPEALS FOR THE
THIRD CIRCUIT

No. 04-2494

MICHAEL L. BERNBACK,
PLAINTIFF-APPELLANT,
Vv.
TIKOMAS GRECO, INDIVIDUALLY AND AS PRESIDENT OF
HARVEY’S LAKE AMPHITHEATER, INC.,
DEFENDANT-APPELLEE.

Submitted: March 7, 2005
Opinion Filed: March 30, 2005

Appeal from the United States District Court for the Middle
District of Pennsylvania. (D.C. Civ. No. 98-00230).
Honorable A. Richard Caputo, District Judge.

Before SCIRICA, Chief Judge, and ROTH and
GREENBERG, Circuit Judges.

OPINION

GREENBERG, Circuit Judge.

This matter comes on before this court on an appeal from
an order entered April 29, 2004, in accordance with a
memorandum opinion of the district court of that day.
Inasmuch as we are writing only for the parties who, of
course, are familiar with this case, we need not set forth its
facts or procedural history. The issue in this case is quite
simple and is stated fairly by Michael L. Bernback, the
appellant: whether interest on an award of attorneys fees and

2a

expenses accrues from the date of the original judgment on a
jury verdict entitling a party to attorneys fee and expenses, in
this case November 6, 2000, or, as the appellee Thomas
Greco argues, from the time when a judgment was entered on
the award of attorneys fees and expenses after they were
quantified, in this case, July 29, 2002. The district court
selected the later date and Bernback has appealed.

The district court exercised diversity of citizenship
jurisdiction under 28 U.S.C. § 1332 and we exercise
jurisdiction under 28 U.S.C. § 1291. We exercise plenary
review as the question is purely of law. Tudor Dev. Group,
Inc. v. United States Fid. & Guar. Co., 968 F.2d 357, 359 (3d
Cir. 1992).

We will affirm as our result is controlled by our opinion
in Eaves v. County of Cape May, 239 F.3d 527, 542 (3d Cir.
2001). Bernback’s brief, which argues for interest from the
earlier date and cites precedent from other courts of appeal in
support of this contention, necessarily is of no avail as it is
dependent on his assertion that we “wrongly followed the so-
called minority view,” appellant’s br. at 17, in reaching our
result in Eaves. Of course, we as a panel must reject
Bernback’s contention as Eaves binds us. Third Circuit IOP
9.1.

The order of April 29, 2004, will be affirmed.

3a

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

MICHAEL L. BERNBACK,

Plaintiff,
VS. : CIVIL ACTION NO.
3:98-CV-0230
THOMAS GRECO, ;
Individually and as President : (JUDGE CAPUTO)
of Harvey’s Lake
Amphitheater, Inc.,

Defendant.

MEMORANDUM

This matter presents the interesting question as to
whether the prevailing party who has been awarded legal fees
is limited to interest on the awarded fees or whether the
prevailing party may recover additional attorney fees on the
interest accrued and paid on the judgment itself. The issue is
presented because in awarding attorney fees in the first
instance, I found any fees were capped to the Plaintiff’s
agreement with his lawyer. The documents authorizing fees
to the Plaintiff spoke of collecting from Defendant the actual
fees incurred by the Plaintiff. At the same time, Plaintiff’s
fee agreement with his counsel limited his fees to 40%. The
relevant provisions are as follows:

2. I (we) agree to pay Angina & Rovner, P.C. any
out-of-pocket expenses they incur to secure records,

_ expert etc., plus a contingent fee that is totally
dependant upon their obtaining monies for me (us)
as follows...

(c) Settlement or verdict at trial, or
arbitration, after trial, arbitration, or

4a

appeals or shortly before trial, and
after this case has been totally
prepared — 40%

(d) If no-fault recovery or non-
monetary benefit — RCA ($500);
NJR ($450); others ($400) per hour
but not to exceed 40% of the total
recovery of value of benefit.

(Power of Attorney and Fee Agreement, Doc. 270, Ex. A at §
2(c)(d)) (emphasis added).

By his Motion for Interest, Attorney’s Fees and Expenses
(Doc. 302), Plaintiff seeks to recover 40% of the interest
which was paid on the judgment. In addition, Plaintiff seeks
interest on the attorney’s fees already awarded, and he seeks
the interest from the day I determined the fees were due, not
from the day they were quantified.

The interest on the attorney’s fees already awarded in the
amount of $90,000 began to run on July 29, 2002, the day
judgment was entered on the amount of fees. This is
governed by Eaves v. County of Cape May, 239 F.3d 527 (3d
Cir. 2001) where the court held that post judgment interest on
an attorney’s fee award runs from the date the award is
quantified, viz the date there is a “money judgment” under 28
"U.S.C. § 1961(a). /d. at 527. Therefore, interest on the award
of counsel fees and of course the expenses awarded
($162,748.62) begins to run July 29, 2002, the date the
judgment for the amount of the fees was entered. The amount
of interest owed is therefore $54,935.78.

As noted, Plaintiff also seeks additional fees for services
rendered in connection with a post trial appeal to the United
States Court of Appeals for the Third Circuit, opposing a
petition for a writ of certiorari to the United States Supreme
Court, and various other matters requiring the performance of
legal services.

Sa

In deciding the entitlement and amount of fees on the
Plaintiff's original petition for fees and expenses, I did a
lodestar analysis, and determined the amount yielded in the
lodestar analysis was limited by the agreement which Plaintiff
had with his counsel, since the documents providing for fees
and costs to the prevailing party authorized “actual attorney’s
fees incurred, court costs, and other litigation related
expenses.” (See Memorandum of May 20, 2002 at p. 6.) The
fee agreement between the Plaintiff and counsel provided for
a contingent fee of 40% in the event of “settlement or verdict
at trial... or appeals . . . and after the case had been totally
prepared.” (/d. at p. 15.)

Now I am confronted with the Plaintiff's claim for
additional fees performed for proceedings post judgment, viz
appeal to the United States Court of Appeals for the Third
Circuit and petitions for writ of certiorari to the United States
Supreme Court. This represents a period of November 9,
2002 to the present. Plaintiffs have not yet provided the
number of hours of services provided during this period.

Plaintiff should submit evidence of those services, and |
will undertake to determine the amount of fees to which
Plaintiff is entitled. After I do a lodestar analysis respecting
the additional legal services, | will determine the amount of
fees due taking into account the fee agreement.

Therefore, Plaintiff will submit his evidence of fees and
expenses for the period since November 20, 2002, together
with a brief, within thirty (30) days and the Defendant shall
have thirty (30) days to file opposing evidence and a brief.

An appropriate order follows.

Date : April 24, 2004

A. Richard Caputo
United States District Judge

Supreme Court, US,
FILED

No. 05-19 SEP 3 1 25
Su The i
Supreme Court of the Anited States
--——-

MICHAEL L. BERNBACK,
Petitioner,

Vv.

THOMAS GRECO, Individually and as
President of Harvey’s Lake Amphitheater, Inc.,

Respondent.

&

On Petition For A Writ Of Certiorari
To The United States Court Of Appeals
For The Third Circuit

2
Vv

BRIEF OF RESPONDENT IN OPPOSITION
TO PETITION FOR WRIT OF CERTIORARI

&
Vv

JOSEPH M. COSGROVE
Counsel of Record
1460 Wyoming Avenue
Forty Fort, PA 18704
(570) 287-0921

Attorney for Respondent

COCKLE LAW BRIEF PRINTING CO (800) 225-6964
OR CALL COLLECT (402) 342-2831

QUESTION PRESENTED

Whether the Court should decline to review an unpub-
lished decision of the U.S. Court of Appeals for the Third
Circuit affirming the district court’s determination of the
date from which interest on a judgment for attorney’s fees
accrues under 28 U.S.C. 1961(a), when, unlike cases from
other circuits interpreting sec. 1961(a), the district court’s
assessment of attorney's fees in this case was based upon
private contracts between the parties as well as a compli-
cated fee agreement between petitioner and counsel, and
was not otherwise specifically provided for by statute or
other provision of law.

li
CORPORATE DISCLOSURE STATEMENT

Respondent, Thomas Greco, was the sole shareholder
of Harvey's Lake Amphitheater, Inc. Through the Stock
Purchase Agreement at issue in this case, petitioner
acquired “a 50% interest in Harvey's Lake Amphitheater,
subject to certain conditions.” Bernback v. Greco, No. 02-
2742, 69 Fed.Appx. 98, 101 (CA3 July 11, 2003). Respon-
dent appears in this matter individually, and as President
of Harvey’s Lake Amphitheater, Inc.

ill

TABLE OF CONTENTS

Page
QUESTION PRESENT i sccs i cssisciieisdensssevisevssseses i
CORPORATE DISCLOSURE STATEMENT ............. il
COUNTER-STATEMENT OF THE CASE................. 1
REASONS FOR DENYING THE WRIT.................... 3

A. Since the attorney’s fees awarded in this case
were based on the district court’s interpreta-
tion of complicated private contracts and not
on statutory or other provisions of law (as in
the cases cited by petitioner as representing
a “recurring circuit conflict”), the factual
complexity of this case makes it an inappro-
priate vehicle for consideration of the ques-
tion presented by petitioner ........................085

RERPNG RIA ISIN IER iota cs socks ba ok ia Seas e aks Geineepnaueeanees

1V

TABLE OF AUTHORITIES

Page
CASES:
Associated General Contractors of Ohio, Inc. v.
DraGik 256 Fae 482 (CAG 200K) oo: oii ai eaveaneseet 4
BankAtlantic vu. Blythe Eastman Paine Webber, Inc.,
pe ea” G7 OSS Se oo: | 9 Sane ae ane apni IE eee RP Vern Py ‘
Bernback v. Greco, No. 02-2742, 69 Fed.Appx. 98
(CA3 July 11, 2003), cert. denied, 540 U.S. 1185
SUN ad asa che cs sad can osviasay avd sks oddaia ee
Copper Liquor, Inc. v. Adolph Coors Co., 701 F.2d
Ot aos ccs Sassia ss ss natsapansisieusccseuasendel 4,5
Eaves v. County of Cape May, 239 F.3d 527 (CA3
| 8 8 SEGRE OSES Peso ety peo ean pk ot herent ng ae CN 2,4, 6
Fleming v. County of Kane, 898 F.2d 553 (CA7
C+ | SSRUNG SRUSEASS HS eed See Ai CO RPE EDC EEO SB RIE GREED or? 4
Friend v. Kolodzieczak, 72 F.3d 1386 (CA9 1995),
cert: denied. SiG U.S. 1146 (1906) «o.oo ccs aonsccccitecsscnenenes 4
Jenkins v. Missouri, 931 F.2d 1273 (CA8 1991)....0..00000000... 4
Kaiser Aluminum & Chemical Corp. v. Bonjorno,
494 U.S. 827, 110 S.Ct. 1570, 108 L.Ed.2d 842
MRR geile ok eckcsesonchk exdets ionon dec cdiGuaoseassacaemiphabetnel 3
Aing v. JCS Enterprises, Inc., 325 F.Supp.2d 162
RIN ics coded a dichsas Anica Riaandcccondescaacoberneodadial 5
Mathis v. Spears, 857 F.2d 749 (CAFC 1988).........00.......... 4

MidAmerica Federal Savings & Loan Association v.
Shearson/American Express, Inc., 962 F.2d 1470
ON BRE oie ap cdr <u conacds eosdeacakades sncsaveasigsuadincboanmeed 4,5

U.S. v. Metropolitan Dist. Com’n, 847 F.2d 12 (CA1
1966) .2.05..; Sia tapicea Natick ies PiGdsai pei Cas ccaccnds chads Seach eubaneh ea 6

TABLE OF AUTHORITIES — Continued

Page
STATUTES:
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ee PIG RN ieee bs ions sks a scaschod.cacsdsscicesscshcc: 2, 3, 4,5
PP Masia tstthasdababvchcisicecacnescxeschpdsisceisonsbsedastedendbcsacs 4
Nhs iirc wriditiadinisadlsdedeainiondessdanearscbiancvosecauaceaiooes 4
LS EE RES URES SE Ree a Ae SR RAEN EOP R IT 4
a PER asic Sco cia is wate aPaeohs dn chdsahans cackenasiaatoonc 5

RULES AND REGULATIONS:
EIS Ss te ERR ey ld BRM RO MBL Bog 1
a 4

COUNTER-STATEMENT OF THE CASE

The underlying facts of this case reflect a complicated
business relationship between petitioner and respondent
manifested in several agreements between them individu-
ally as well as through the entity known as Harvey’s Lake
Amphitheater, Inc (“HLAI”). Although HLAI was formed
in 1992 to construct an outdoor concert arena near the
popular Pocono Mountain recreation area of Pennsylvania,
the relationship between petitioner and respondent had so
deteriorated by 1996 that a series of legal struggles scon
commenced. Bernback v. Greco, No. 02-2742, 69 Fed.Appx.
98, 101 (CA3 July 11, 2003). The pending petition is
merely the most recent salvo in this long and combative
process. In fact, this is not the first time this Court has
reviewed a petition for writ of certiorari regarding these
parties. In 2004, certiorari was denied on respondent’s
petition seeking review of the Third Circuit’s affirmation
of the district court’s permission to amend petitioner’s
complaint in the midst of trial, despite the admonitions of
-Rule 15, Fed.R.Civ.P. Bernback, supra, cert. denied, 540
U.S. 1185 (2004). .

Now, it is petitioner who is unhappy with a lower
court’s determination of an issue important to him,
namely, the question of whether interest accrues on an
award of attorney's fees from the date of the initial judg-
ment on the merits (which, in this case did not include an
award of fees), or as the Third Circuit held below, from the
“time when a judgment was entered on the award of
attorney's fees and expenses after they were quantified
...” Pet. App. 2a.

The peculiar factual history of this matter is essential
to consideration of the question at hand: On November 6,

2000, after the jury’s verdict, the district court entered
judgment in petitioner’s favor, without specific reference to
attorney’s fees. There was also no indication that attor-
ney’s fees were allowable under any particular statutory or
other legal provision. Instead, petitioner filed a_post-
verdict motion for fees and expenses, alleging that two
alleged contracts between him and respondent “contained
fee shifting provisions that allowed for an award of attor-
neys fees ...” Bernback, 69 Fed.Appx. at 105. The district
court reviewed these contracts (a Stock Purchase Agree-
ment as well as a Personal Guarantee, id.) and concluded
that although each contract contained provisions for
award of attorney's fees, petitioner had also entered into a
separate fee agreement with his counsel which “limited
[counsel's] fees to 40%.” Pet. App. 3a. For this reason, the
district court “conform[ed] the fee award to the fee agree-
ment between |petitioner] and his counsel.” Bernback,
supra. The first judgment, therefore, to address attorney’s
fees was entered on July 29, 2002, after the district court
construed the role of these three private agreements in the
calculation of those fees. Pet. App. 3a.

When respondent later sought interest on the
awarded fees, the district court construed the plain lan-
guage of 28 U.S.C. 1961(a) (hereinafter sec. 1961), as well
as the Third Circuit's decision in Eaves v. County of Cape
May, 239 F.3d 527 (CA3 2001) and held that interest
would be calculated from July 29, 2002, “the day judgment
was entered on the amount of fees.” Pet. App. 4a. When
the Third Circuit affirmed, id. at la, petitioner sought this
Court's review.

3

REASONS FOR DENYING THE WRIT

A. Since the attorney’s fees awarded in this case
were based on the district court’s interpretation
of complicated private contracts and not on statu-
tory or other provisions of law (as in the cases
cited by petitioner as representing a “recurring
circuit conflict”), the factual complexity of this
case makes it an inappropriate vehicle for consid-
eration of the question presented by petitioner.

The attorney's fees at issue in this case were calcu-
lated by the district court based upon its interpretation of
three separate, complicated and even conflicting agree-
ments between private parties, and were not premised on
any statutory or rule-based provisions. The district court
found that petitioner and respondent were parties to two
of these private agreements (a finding which respondent
continues to vigorously oppose), namely the Stock Pur-
chase Agreement and the Personal Guarantee which form
the basis for much of the nearly decade long litigation
between them. The third contract was a fee agreement
between respondent and his counsel, which was based
upon a complex calculus of both hourly rates and percent-
age of recovery. Pet. App. 3a-4a. Without this stew of
private contractual provisions, the award of attorney’s fees
would not have been at issue in this case.

After extraction of the various fee-based clauses of
these three documents, and its interpretation of their
relevance to one another, the district court constructed its
fee assessment and entered judgment awarding the
quantified fee on July 29, 2002. Under the plain statutory
language of sec. 1961, any interest on this award could
only be calculated from this date. See, Kaiser Aluminum &
Chemical Corp. v. Bonjorno, 494 U.S. 827, 835 (1990)

(“[Tlhe starting point for interpretation of [sec. 1961] . . . is
the language of the statute itself.”). It is this calculation,
however, which petitioner seeks to overturn.

Petitioner takes great pains to urge this Court’s
review of what it perceives to be a “frequently recurring
circuit conflict” on the question of when the calculation of
interest on a sec. 1961 award begins to run, specifically
with regard to attorney's fees. Petition at 2-3. Supporting
. this contention is a list of decisions from the several courts
of appeals addressing the calculation date for interest on
such fees. See, e.g., Associated General Contractors of Ohio,
Inc. v. Drabik, 250 F.3d 482, 484-85 (CA6 2001); Eaves,
supra; MidAmerica Federal Savings & Loan Association v.
Shearson/American Express, Inc., 962 F.2d 1470, 1476
(CA10 1992); Fleming v. County of Kane, 898 F.2d 553, 565
(CA7Z 1990); Friend v. Kolodzieczak, 72 F.3d 1386, 1391-92
(CA9 1995), cert. denied, 516 U.S. 1146 (1996); BankAtlan-
tic v. Blythe Eastman Paine Webber, Inc., 12 F.3d 1045,
1052-53 (CA11 1994); Jenkins v. Missouri, 931 F.2d 1273,
1277 (CA8 1991); Mathis v. Spears, 857 F.2d 749, 760
(CAFC 1988); Copper Liquor, Inc. v. Adolph Coors Co., 701
F.2d 542, 544-45 (CA5 1983). The underlying facts of these
cases, however, are vastly different from those in the
present case. In fact, in each of the cases cited by peti-
tioner, the award in question was based cither on statute
or rule which was evident at the time of entry of the award
on the merits._

For example, Drabik, Eaves, Fleming, Friend and
Jenkins were civil rights cases under 42 U.S.C. 1983, with
the question of attorney's fees governed by 42 U.S.C. 1988.
In BankAtlantic, the court imposed discovery violation
sanctions pursuant to Rule 37, Fed.R.Civ.P. Mathis was a
patent case, with the fee question arising under 35 U.S.C.

285. Copper Liquor involved the Sherman Act, 15 U.S.C. 1,
with fees claimed under the Clayton Act, 15 U.S.C. 15. On
the other hand, the fee issue in MidAmerica arose out of a

pendent state claim under the Oklahoma Securities Act.
71 Okla.Stat. 408.

Whatever their decision on the sec. 1961 question,
these cases represent the prevailing view regarding award
of attorney's fees, namely, that “[uJnder the ‘American
Rule,’ the prevailing party will not be awarded attorney’s
fees unless expressly authorized by Congress.” King v.
JCS Enterprises, Inc., 325 F.Supp.2d 162 (E.D.N.Y. 2004).
In each of the cases cited by petitioner, either federal or
state statute, or procedural rule governed the award of
fees. As such, the existence of these provisions which
“expressly authorized” the award of attorney’s fees was
obvious throughout those proceedings.

Such is not the case, however, in the present matter.
There is no ancillary statute or rule which “expressly
authorized” the award of fees in this case. Instead, the fees
in question were contractually based, and required a
separate motion for their award as well as a separate
adjudication by the district court.

Given the interpretive gymnastics in which the
district court had to engage in order to determine what, if
any, fee would be awarded, it is an imaginative stretch to
say that at the time of the jury verdict and judgment on
the merits, it was clear that petitioner was “‘uncondition-
ally entitled’ to recover attorney's fees.” Petition 7-8, fn. 4.
As such, the only “judgment” relevant to a sec. 1961
interest calculation under the peculiar facts of this case
was the July 29, 2002 date. By upholding the district
court, the Third Circuit merely recognized that “[iJn the

6

realm of fee awards ... to a far greater extent than is true
of discrete legal issues, the battle is likely to be deter-
mined in the trial court ...” U.S. v. Metropolitan Dist.
Com'n, 847 F.2d 12 (CA1 1988) (internal citations omit-
ted).

While petitioner suggests that grant of certiorari is
necessary in this case in order to resolve this supposed
“circuit conflict,” he is mistaken. In fact, this case is a most
inappropriate vehicle for resolution of the question peti-
tioner presents given the complex factual marsh through
which the Court must wade in order to reach that ques-
tion. Actually, this Court would have to dive into the
district court’s fact-based assessment of the contracts at
issue and the intent of the various parties to those con-
tracts and then determine what impact these factual
nuances have on the assessment of sec. 1961 issues in
other cases where a clearer underlying entitlement to
attorney's fees existed. Such machinations do not readily
allow for the kind of clear resolution petitioner seeks, nor
do they easily support invocation of certiorari. As such, for
these reasons this Court should deny certiorari. ~

+

' Petitioner is in error when he suggests that the Third Circuit
only grudgingly affirmed. See, Petition at 2, § 3. His claim that the
Third Circuit “acknowledged that petitioner's position was supported
‘by precedent from other courts of appeals,’” is an overstatement. I[d.
The Third Circuit merely noted that petitioner had cited these other
cases, but did not give any indication that it agreed with petitioner as
to their value. Instead, the panel restated its allegiance to the prece-
dent from this Circuit outlined in Eaves.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386007_1628%3A2. Public record. Not legal advice.
