Flowers v. So Regn Physn Svcs ( 2002 )

REVISED APRIL 12, 2002
UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 01-30816
SANDRA SPRAGIS FLOWERS,
Plaintiff-Appellant,
VERSUS
SOUTHERN REGIONAL PHYSICIAN SERVICES, INC.
Defendant-Appellee.
Appeal from the United States District Court
For the Middle District of Louisiana
March 26, 2002
Before HIGGINBOTHAM, DeMOSS, and BENAVIDES, Circuit Judges.
DeMOSS, Circuit Judge:
Appellant Sandra Spragis Flowers won a jury verdict of
$100,000 in damages for harassment under the Americans with
Disabilities Act from Appellee Southern Regional Physicians
Services, Inc. (“Southern”). Southern appealed the damages award.
While the appeal was pending, Flowers filed a motion for attorney’s
fees, which was granted by the district court. Subsequent to the
awarding of attorney’s fees, this Court vacated the damage award of
$100,000 and remanded so that nominal damages of $1.00 could be
awarded. Southern then filed a motion for relief from judgment
pursuant to Federal Rules of Civil Procedure 60(b) so that they
would not have to pay attorney’s fees. The district court granted
the motion and Flowers now appeals.
BACKGROUND
Flowers commenced suit under the ADA, 42 U.S.C. § 12012,
against her former employer, Southern, alleging she was harassed
and fired because of her infection with HIV. On December 8, 1998,
the matter went to trial and a jury awarded damages for the
harassment in the amount of $350,000, which was then reduced to
$100,000 due to limitations imposed by 42 U.S.C. § 1981a.1 On July
21, 1999, the district court entered judgment on the jury’s
verdict.2 On July 28, 1999, Flowers filed a motion for attorney’s
fees and costs in excess of $100,000, which Southern opposed. On
December 6, 1999, Southern filed a notice of appeal to this Court
seeking review of the liability findings and damages awards by the
1
Apparently, the jury found for Flowers only on her
harassment claim but not on her claim that her termination was
motivated by her disability.
2
Both parties consented to trial by Magistrate on January
23, 1998. The order referring to a Magistrate all further
proceedings and entry of judgment was entered on January 26, 1998
by Judge Frank J. Polozola. All references in this opinion to the
“district judge” or “district court” from the present case,
therefore, refer to Magistrate Judge Stephen C. Riedlinger.
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jury, but did not appeal the awarding of attorney’s fees because no
judgment on Flowers’ motion had been made yet.
On February 14, 2000, the district court entered a judgment
for attorney’s fees in the amount of $52,561.25 plus interest and
costs. On March 30, 2001, this Court affirmed the judgment of
Flowers’ case as to liability but vacated and remanded on the issue
of damages, instructing the district court to enter a judgment for
nominal damages of $1.00. On April 12, 2001, Flowers filed a
motion for writ of execution seeking execution of the judgment of
February 14, 2000, for attorney’s fees. On April 19, 2001,
Southern filed a motion for relief from judgment under Fed. R. Civ.
P. 60(b)(6). On June 20, 2001, the district court granted the
motion for relief from judgment and vacated the judgment of
February 14, 2000, and denied the writ of execution. In doing so,
the district court re-styled the motion as one brought under Fed.
R. Civ. P. 60(b)(5) instead of (b)(6). Flowers now appeals from
this decision.
DISCUSSION
Did the district court err in granting the Rule 60(b) motion
despite Flowers’ continued standing as a prevailing party?
In contesting the district court’s decision, Flowers puts
forward three arguments. First, Flowers contends that the Rule
60(b) motion should be viewed as a Rule 60(b)(1) motion for
excusable neglect and that, as such, it should be denied for being
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untimely. Second, Flowers contends that because this Court found
in favor of her as to liability (though not damages), she remains
the prevailing party. As such, she asserts that Rule 60(b)(5)
cannot apply because this Court did not reverse or vacate the
liability portion of her judgment, which was the basis for awarding
attorney’s fees. Finally, she argues that Rule 60(b)(6) also is
inapplicable because it should only be used in extraordinary
circumstances.
Southern counters that Rule 60(b)(1) is inapplicable because
it was under no duty to appeal the awarding of attorney’s fees
before the appeal on the issue of damages and liability was
resolved. It also asserts that Rule 60(b)(5) or (6) would be
proper. It agrees with the district court’s use of (b)(5) because
the attorney’s fees were awarded based on the damages, not the
existence of liability, and now that the damages have been vacated,
that part of the verdict that was the basis of granting attorney’s
fees has disappeared. Southern also asserts that equity would
allow the district court to use (b)(6) anyway.
This Court reviews a district court’s decision to grant or
deny relief under Rule 60(b) for an abuse of discretion. Halicki
v. Louisiana Casino Cruises, Inc., 151 F.3d 465, 470 (5th Cir.
1998). Rule 60(b) states, in relevant part:
(b) Mistakes; Inadvertence; Excusable Neglect;
Newly Discovered Evidence; Fraud, Etc. On motion
and upon such terms as are just, the court may
relieve a party or a party’s legal representative
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from a final judgment, order, or proceeding for the
following reasons: (1) mistake, inadvertence,
surprise, or excusable neglect; (2) newly
discovered evidence which by due diligence could
not have been discovered in time to move for a new
trial under Rule 59(b); (3) fraud (whether
heretofore denominated intrinsic or extrinsic),
misrepresentation, or other misconduct of an
adverse party; (4) the judgment is void; (5) the
judgment has been satisfied, released, or
discharged, or a prior judgment upon which it is
based has been reversed or otherwise vacated, or it
is no longer equitable that the judgment should
have prospective application; or (6) any other
reason justifying relief from the operation of the
judgment. The motion shall be made within a
reasonable time, and for reasons (1), (2), and (3)
not more than one year after the judgment, order,
or proceeding was entered or taken. A motion under
this subdivision (b) does not affect the finality
of a judgment or suspend its operation.
Fed. R. Civ. P. 60(b). Flowers believes that Southern should have
appealed the awarding of attorney’s fees when granted and that the
failure to do so should be viewed as “excusable neglect” on the
part of Southern. She asks, therefore, that their motion be re-
styled as one under Rule 60(b)(1). Such motions must be made
within one year after the judgment, however, and so if Southern’s
motion is viewed as one under (b)(1), then it is untimely.
Southern does not dispute that a motion under Rule (b)(1) would be
untimely but points out that they are under no duty to appeal the
awarding of attorney’s fees and so (b)(1) does not apply.
Though this Court has never before dealt with the issue of
whether an appeal of attorney’s fees is required in light of a Rule
60(b)(5) or (b)(6) motion, other circuits have. As Southern points
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out, both the Ninth and the Seventh Circuits have recognized that
a party must file a separate appeal only when it challenges some
aspect of the award itself. California Med. Assoc. v. Shalala, 207
F.3d 575, 577 (9th Cir. 2000); Mother Goose Nursery Sch., Inc. v.
Sendak, 770 F.2d 668, 676 (7th Cir. 1985); see also Maul v.
Constan, 23 F.3d 143, 147 (7th Cir. 1994) (holding that it was an
abuse of discretion for the district court to deny a Rule 60(b)(5)
motion for relief when the merits judgment was reduced to nominal
damages on appeal); cf. Bailey v. Ryan Stevedoring Co., 894 F.2d
157, 160 (5th Cir. 1990) (noting that because no prior judgment
upon which attorney’s fees was based had been reversed or otherwise
vacated, Rule (b)(5) was inapplicable on its face). In Shalala,
the Ninth Circuit held that though a separate appeal must be made
to challenge some aspect of the fee award itself, “Rule 60(b)(5) is
available if a party seeks relief solely on the ground that the
underlying merits judgment is reversed.” Shalala, 207 F.3d at 577.
Despite Rule 60(b)(5) appearing to be an appropriate motion in
such an instance, Flowers argues that it can not apply in the
present case because the underlying judgment was not reversed or
vacated. The damages were reduced to nominal but Flowers maintains
that because this Court did not reverse the liability aspect of the
jury’s decision, she is still entitled to attorney’s fees as a
prevailing party. Flowers argument, however, has no basis in the
statute or in equity. Rule 60(b)(5) provides that relief may be
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sought when “the judgment has been satisfied, released, or
discharged, or a prior judgment upon which it is based has been
reversed or otherwise vacated, or it is no longer equitable that
the judgment should have prospective application.” Fed. R. Civ. P.
60(b)(5) (emphasis added). Rule 60(b)(5) states nothing about
relief being denied in favor of a prevailing party. As the
district court in the present case noted, a decision is “based on”
a prior judgment when it is “a necessary element of the decision,
giving rise, for example, to the cause of action or a successful
defense.” Bailey, 894 F.2d at 160. This Court’s opinion as to the
underlying proceeding states “we VACATE the jury’s damages award
and REMAND the case for the entry of an award of nominal damages.”
Flowers v. Southern Reg’l Physician Serv., Inc., 247 F.3d 229, 239
(5th Cir. 2001).
The district court in the present case recognized that its
awarding of attorney’s fees was based on the amount awarded in
damages and not on the existence of liability alone. Awarding
attorney’s fees based on the damages, or degree of success
obtained, is completely in line with the holdings of the Supreme
Court and this Circuit. Farrar v. Hobby, 506 U.S. 103, 114-115
(1992); Giles v. General Elec. Co., 245 F.3d 474, 491 n.31 (5th
Cir. 2001). In Farrar, the Supreme Court held that though a civil
rights plaintiff who recovers nominal damages is a “prevailing
party” for the purposes of the civil rights attorney fee provision,
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the nominal nature of the awards does affect the propriety of the
fees awarded, and that when nominal fees are awarded it is
appropriate for the prevailing party’s attorney to receive no fees
at all. Farrar, 506 U.S. at 114-15. “When a plaintiff recovers
only nominal damages because of his failure to prove an essential
element of his claim for monetary relief . . . the only reasonable
fee is usually no fee at all.” Id. at 115 (internal citations
omitted). In the present case, the district judge granted the
attorney’s fees in light of the damages, which were $100,000. This
Court vacated the awarding of $100,000 and remanded to the district
court to enter a judgment of nominal damages in the amount of
$1.00. Therefore, that part of the judgment that formed the basis
of the granting of attorney’s fees was vacated and Rule 60(b)(5)
was appropriate.
The Seventh Circuit faced a similar case in 1994 in Maul v.
Constan, 23 F.3d 143 (7th Cir. 1994). In Maul, the plaintiff,
Maul, was an inmate in an Indiana prison who sued for violations of
his civil rights under 42 U.S.C. § 1983. Id. at 144. After an
award of damages and subsequent remand, the district court granted
Maul $22,500 in damages in June, 1991. Id. In August, 1991 the
district court granted Maul $18,542.93 in attorney’s fees. Id.
Over a year later, in December, 1992, the Seventh Circuit reversed
the district court’s award of $22,500 because Maul had failed to
prove actual injury. Id. The Seventh Circuit then remanded the
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case to the district court to assess $1.00 in nominal damages
against the defendants. Id. The award of attorney’s fees was not
part of that appeal. Id. In February, 1993, after the $1.00
judgment was entered, the defendants moved under Rule 60(b)(5) for
a refund of the attorney’s fees. Id. The district court denied
the motion and the defendants appealed. Id. at 144-45. The
Seventh Circuit reversed the district court’s decision, relying
heavily on the reasoning of Farrar to justify its conclusion that
no attorney’s fees should be awarded. Id. at 145-47. The present
case is distinguishable only in that this Court does not even have
to overcome the standard of review that acts in favor of the
district court’s decision as the court in Maul did. The district
judge reviewed the Rule 60(b)(5) motion in light of this Court’s
vacating the damages and concluded that the motion was justified
and no abuse of discretion should be found. We hold, therefore,
that Rule 60(b)(5) was appropriate in the present case. Having
reached that conclusion, there is no need to delve into the issue
of whether Rule 60(b)(6) is also appropriate.
CONCLUSION
Having carefully reviewed the record of this case and the
parties’ respective briefing and for the reasons set forth above,
we conclude that the district court did not err in granting
Southern’s Rule 60(b) motion. Southern could not have appealed the
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awarding of attorney’s fees at the time that order was made and
Rule 60(b)(5) is perfectly designed to accommodate such a
situation. We therefore AFFIRM the district court’s decision.
AFFIRMED.
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