Properties Unlimited v. Cendant Mobility ( 2004 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
Nos. 02-3709 & 03-1488
PROPERTIES UNLIMITED, INC. REALTORS,
Plaintiff-Appellant, Cross-Appellee,
v.
CENDANT MOBILITY SERVICES, et al.,
Defendants-Appellees, Cross-Appellants.
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Appeals from the United States District Court for
the Northern District of Illinois, Eastern Division.
No. 01 C 8375—James B. Moran, Judge.
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ARGUED SEPTEMBER 8, 2003—DECIDED OCTOBER 7, 2004
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Before KANNE, ROVNER, and WOOD, Circuit Judges.
WOOD, Circuit Judge. Properties Unlimited (Properties)
is an Illinois real estate brokerage firm that participated for
a number of years as a franchisee of Coldwell Banker Real
Estate Corporation (Coldwell), a large national firm.
Through that connection, Properties was also able to
participate in the Coldwell Relocation Plan, which was a
lucrative source of referrals from Coldwell itself and from
other Coldwell franchisees. This suit arose after Properties
renewed its franchise agreement with Coldwell in 1995 for
2 Nos. 02-3709 & 03-1488
another seven years, expecting more or less the same level
of referrals. In 1996, however, a predecessor of Cendant
Corporation, one of the defendants here, acquired the
franchisor of the Coldwell Banker network and decided to
phase out the Coldwell Relocation plan and to replace it
with a new plan dubbed the Cendant Mobility Program. In
order to do so, Properties alleges, Cendant made certain
representations to the Coldwell franchisees, including Proper-
ties, essentially promising that these changes would be
beneficial overall. When Properties realized that this was
not going to be the case, it brought this lawsuit under the
diversity jurisdiction, asserting claims based on common law
fraud, the Illinois Consumer Fraud and Deceptive Practices
Act, and breach of contract.
The proceedings in the district court turned into a pro-
cedural snarl, but at the end of the day, Properties was
unsuccessful. Properties is now trying to appeal from the
district court’s orders dismissing all claims, but it must first
convince us that this appeal is timely before we can reach
the merits. That finding is possible only if we conclude that
the district court’s efforts to vacate its original judgment
and later to re-enter judgment on September 25, 2002, had
the effect of postponing the time to appeal. Cendant has cross-
appealed from a later order of February 19, 2003, purporting
to clarify everything. While we realize that matters became
quite confused for a time, in the final analysis it is clear
that Properties failed to file a timely appeal. We therefore
dismiss the principal appeal as untimely; this in turn moots
Cendant’s timely cross-appeal from the Rule 60(b) order.
I
Properties, an Illinois corporation with its principal place of
business in Illinois, filed this lawsuit against Cendant
Mobility Services and Cendant Corporation, both Delaware
corporations with their principal places of business outside
Nos. 02-3709 & 03-1488 3
of Illinois, on October 31, 2001. After preliminary proceed-
ings, the defendants filed a motion to dismiss for failure to
state a claim, under Rule 12(b)(6). On May 24, 2002, the
district court entered a Minute Order, accompanied by a
Memorandum Opinion, granting the defendants’ motion and
dismissing with prejudice Counts I, II, and III of the
complaint. The Order went on to say that “[s]ince plaintiff
has voluntarily dismissed Count IV, plaintiff’s complaint is
dismissed.” This order was entered on the court’s docket on
May 28, 2002. Unfortunately, however, no formal judgment
form reflecting this fact was prepared, nor does the docket
sheet show a separate entry for the judgment.
On June 13, 2002, more than ten days after the order was
docketed (as these things are counted under Rule 6(a)),
Properties filed a motion for reconsideration of the May 24
order. Five days later, on June 18, it followed up with an
emergency motion under Rule 60(b)(1) for relief from the
May 24 order or for an extension of time to file a notice of
appeal under FED. R. APP. P. 4(a)(5). It did so notwithstanding
the fact that the 30-day period for appeal provided by
Appellate Rule 4(a)(1) was not due to expire until June 27.
Apparently, Properties was concerned that the district court
would not have enough time to ponder its motion for
reconsideration before the time for appeal expired. On June
19, the district court granted the Rule 4(a)(5) motion,
extending the time for appeal until July 26, 2002; at the
same time, it denied the Rule 60(b)(1) motion as moot. It
explained that it was extending the time for appeal to give
itself an opportunity to rule on the motion to reconsider.
On July 24, 2002, the district court was still not ready to
rule on the merits of the motion to reconsider. At that point,
it took the unusual step of ordering that the ruling of May
24 dismissing the case “struck.” It made that decision in
chambers, and there is no transcript of what was said. In a
later order, however, the court stated that “we were con-
vinced that the motion for reconsideration merited careful
4 Nos. 02-3709 & 03-1488
consideration and, if we were to change our views, it made
no sense to burden the Court of Appeals with an unneces-
sary appeal. Accordingly, at a time when an appeal was still
timely, it was our intention to vacate any appealable order
and to postpone any appeal until the ruling upon the motion
for reconsideration determined whether the dismissal would
stand.” In the end, the delays did Properties little good. On
September 25, 2002, the district court denied its motion to
reconsider and its request for leave to amend. That order
reads, “We adhere to our original conclusion and deny the
motion to reconsider.” It said nothing about reinstating the
order of May 24, 2002. On October 15, 2002, Properties filed
its notice of appeal from the September 25 order.
Cendant contested jurisdiction in this court on the ground
that the July 24 order had indeed stricken the May 24
order, but that the July order had done nothing about the
judgment entered on the docket on May 28. Properties
responded with a new motion under FED. R. CIV. P. 60(b)
and FED. R. APP. P. 10(e), seeking to “clarify” that the judg-
ment flowing from the May 24 order had also, or should also
have been, vacated. The district court granted that motion
in an order dated February 19, 2003. The court regarded
Cendant’s argument before this court that the July 24 order
had vacated only the May 24 order, and not the May 28
docketed judgment, as coming too late in the day. It con-
cluded as follows:
We intended that the “Order” struck on July 24, 2002,
encompass the Judgment Order (what else could it
mean?), and we believe that Rule 60(b) relief, which we
have power to grant despite the pendency of the appeal,
Stone v. INS, [514 U.S. 386, 401-02 (1995)], and FED. R.
APP. P. 10(e), both provide ample justification for granting
the motion.
Cendant then cross-appealed from the February 19 order.
Nos. 02-3709 & 03-1488 5
II
The first question we must resolve is whether the May 24
order, entered on the docket on May 28, was a final judg-
ment. If it was, then the rest of our analysis is relatively
straightforward. If not, then we confront a different set of
problems, as it is unclear when anything else that counts as
a final judgment may have been entered. The order docketed
on May 28 bore all the indicia of a final judgment: it
disposed of all claims of all parties; it announced that the
dismissals of the counts remaining in the case were with
prejudice; and it said nothing that would have hinted that
the court expected to see an amendment to the complaint.
True, there was no separate judgment entered on the AO
450 judgment form pursuant to FED. R. CIV. P. 58, but it has
been well-established for years in this court that the lack of
a Rule 58 judgment does not prevent a judgment from being
final and appealable. See Otis v. City of Chicago, 29 F.3d
1159, 1165 (7th Cir. 1994) (en banc). The parties also be-
lieved that the district judge had finished with the case.
They were seeking reconsideration and extra time to appeal,
not anything that logically would precede final judgment.
We conclude that the entry of May 28 in the docket was a
final judgment in this case, as contemplated not only by
FED. R. CIV. P. 58, but also by FED. R. APP. P. 4(a)(7).
At that point, Properties had 30 days in which to file a
notice of appeal. Had it filed a motion to reconsider within
10 days of the entry of judgment, such a motion would have
tolled the time for appeal until the court ruled on it, see
FED. R. APP. P. 4(a)(4). But it did not. Instead, it filed a mo-
tion on June 13, two days after the 10-day period expired.
That motion was necessarily under FED. R. CIV. P. 60(b),
and the appellate rules are clear that such a motion does
not toll the time for filing a notice of appeal. See FED. R.
APP. P. 4(a)(4)(A)(vi). Although the district court has the
power to extend the time for filing a notice of appeal upon
a proper motion filed under FED. R. APP. P. 4(a)(5), that rule
also provides as follows:
6 Nos. 02-3709 & 03-1488
(C) No extension under this Rule 4(a)(5) may exceed 30
days after the prescribed time or 10 days after the date
when the order granting the motion is entered, which-
ever is later.
The rule does not preclude a party from filing a motion to
extend the time for appeal during the period before the
original 30-day time has run, as Properties did here. See
Rule 4(a)(5)(B) (expressly acknowledging that a motion might
be filed before the end of the time period prescribed by Rule
4(a)(1)). But it does place an outer limit on the amount of
extra time a district court may grant, and we must see
whether the district court here exceeded that limit.
Under the first branch of Rule 4(a)(5)(C), Properties was
entitled to an extension of up to 30 days beyond the “pre-
scribed” time, which for civil appeals not involving the
United States is the original 30-day period. Thus, the court
could extend the time for appeal until July 27, 30 days be-
yond the original deadline of June 27. That is more or less
what the court did on June 19, when it granted Properties’
Rule 4(a)(5) motion and set the appeal deadline for July 26.
(The alternative date under the rule would have been 10
days after the order granting the motion, or June 29, but the
rule then makes clear that it is the later of the two pos-
sibilities that governs.)
Instead of sticking with the July 26 date, however, the
court sought to buy more time for its own reconsideration of
the May 28 judgment and more time before Properties
would appeal, through the expedient of “vacating” the May
24 order. But its later action, on September 25, makes it
clear that nothing was really vacated. Instead, on that date
the court simply denied the motion to reconsider and did
not even formally reinstate the May 24 order. We thus have
no occasion to address here what might happen if a district
court decided truly to vacate a final judgment like the one
entered here on May 28 and to restore a case to its docket,
Nos. 02-3709 & 03-1488 7
all before anyone had filed a Notice of Appeal to this court.
On these facts, we have only a series of moves designed to
give a longer period of time for filing an appeal than that
provided for in Appellate Rule 4. This was beyond the power
of the district court to do. Properties’ Notice of Appeal was
not filed until October 15, which was too late.
Recognizing the seriousness of its problem, Properties
urges us to permit its appeal nonetheless, under the so-
called unique circumstances doctrine. The Supreme Court
first recognized this narrow rule in Harris Truck Lines, Inc.
v. Cherry Meat Packers, Inc., 371 U.S. 215 (1962). As we
described it later in Varhol v. National Railroad Passenger
Corp., 909 F.2d 1557 (7th Cir. 1990) (en banc), the Court
held in Harris Truck that
if a party relies on a district court’s extension of time to
file a notice of appeal, and delays an appeal, the court
of appeals should not dismiss the appeal because it
disagrees with the district court’s finding of excusable
neglect. . . . If the decision to grant an extension is open
to second-guessing by the appellate court, the only way
a party could protect itself would be to file an appeal
within thirty days of the judgment; but the extension of
time was supposed to allow the party to defer the deci-
sion to appeal.
909 F.2d at 1562 (citing Harris, 371 U.S. at 217). In
Thompson v. INS, 375 U.S. 384 (1964), the Court expanded
this idea to include cases in which a party had relied on a
district court’s conclusion that an act had properly been done,
and the appeal was timely under a mistaken new deadline.
It clarified that rule in Osterneck v. Ernst &Whinney, 489
U.S. 169, 179 (1989), holding that the party filing late
would be excused if he “has received specific assurance by
a judicial officer that this act has been properly done.”
We have taken a narrow view of the Osterneck rule, lest
it become an exception that swallows the rules concerning
8 Nos. 02-3709 & 03-1488
time for appeal. Merely entering a minute order that appar-
ently extends the time for filing a motion under FED. R. CIV.
P. 59, for example, is not enough to count as a “specific
assurance” from the court. See Green v. Bisby, 869 F.2d
1070, 1072 (7th Cir. 1989). Similarly, it cannot be enough
if the district court announces that it is giving the parties
more time than the rules permit, because the rules then
would impose no limits on the court’s discretion. In our view,
the “unique circumstances” exception is available only when
there is a genuine ambiguity in the rules to begin with, and
the court resolves that ambiguity in the direction of per-
mitting additional time to appeal. In that case, the equities
that motivated the Supreme Court to begin with lie strongly
on the side of the party who relied on the affirmative judi-
cial statement.
This case does not meet that standard. Properties was
well-aware of its position at the time it filed its June 18
motion for relief under Rule 60(b). It is, and has been for
years, pellucidly clear that a motion for reconsideration
filed more than 10 days after a final judgment does not toll
the time for a Notice of Appeal. It is obvious that Properties
knew this, or it would not have asked for extra time for its
appeal in the June 18 motion. The fact that the district
court later sought to give Properties more than the per-
missible extra 30 days for filing its appeal through the
device of “vacating” the May 24 order does not change the
legal effect of what happened. The judge had no power to
give Properties any more time to appeal from the May 28
judgment, and it follows that the Notice of Appeal filed on
October 15 was late by almost three months. (We express no
opinion on the possibility that there still may be time for
the judge to enter a proper Rule 58 judgment, and thus to
open a new window for appeal. See United States v.
Indrelunas, 411 U.S. 216 (1973); but see FED. R. APP. P.
4(a)(7)(A)(ii), as amended Dec. 1, 2003, which limits the
window provided by Indrelunas to 150 days.)
Nos. 02-3709 & 03-1488 9
III
Because Properties’ appeal was not filed in time, it is
DISMISSED. As for the September 25 order that purported to
clarify the order of July 24, the first thing to note is that
Properties is not appealing from it as a separate matter,
and thus the fact that its Notice of Appeal was filed within
30 days of that order makes no difference. To the extent
that it has challenged the September 25 order as a stand-
alone matter, we note that this order was entered under
Rule 60(b), and we find no abuse of discretion in the district
court’s decision to adhere to its original rulings. Cendant’s
cross-appeal from the February 19, 2003 order, which
merely indicated that the judge had intended to vacate both
the May 24 order and the May 28 docketed judgment, is
moot in light of our decision on Properties’ appeal and is
therefore DISMISSED on that basis. Costs on this appeal are
assessed against Properties.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—10-7-04