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Remittitur, Lawyers, and Malpractice, Oh My!: Branch Banking v. Gerrard

Unsurprisingly, lawyers really hate it when they get sued.  But, fortunately for one lawyer, the NVSC recently ruled that his former client’s legal malpractice claim against him was time-barred In Branch Banking & Trust Company v. Gerard, 134 Nev., Adv. Op. 106, 432 P.3d 736 (Nev. 2018).  In Nevada, when your case involves an appeal, the two year statute of limitations to sue your lawyer for legal malpractice in handling the case does not run until your “damages are no longer contingent on the outcome of the appeal.”  Branch Banking, 432 P.3d at 738.  The question answered by the NVSC in Branch Banking is when that moment occurs.

BRANCH BANKING WAS APPARENTLY UNHAPPY WITH ITS FORMER LAWYER

 In Branch Banking, Branch Banking & Trust hired attorney Gerrard to represent it in litigation.  432 P.3d at 738.  The lawsuit wound up on appeal with the NVSC, and Branch Banking ultimately lost.  Id.  Branch Banking filed a writ of certiorari to the United States Supreme Court, and the United States Supreme Court denied certiorari on October 6, 2014. Id

While the writ of certiorari was pending, the Nevada Supreme Court issued remittitur in March 2014.  Id. Remittitur means that “the appeal [has] conclude[d] and appellate jurisdiction [has] end[ed].”  Id. at 739.

Sometime while all of this was happening, Branch Banking and Gerrard fell out of love.  I don’t know why.  It’s not in the opinion.  All I know is that Branch Banking ultimately wound up suing Gerrard. 

Branch Banking filed its legal malpractice lawsuit against Gerrard on October 5, 2016, just under two years from the date SCOTUS denied the writ of certiorari, and two years and seven months after the NVSC issued remittitur.  Id. at 738.  Gerrard argued that the bank’s lawsuit was time-barred because it was filed seven months after the two year anniversary of the NVSC’s issuance of remittitur.  Id. The NVSC agreed. 

THE LIMITATION PERIOD TO SUE THE LAWYER RUNS FROM THE DATE OF REMITTITUR UNLESS REMITTITUR IS STAYED

According to the NVSC, the purpose of statutes of limitation are to give people some certainty as to when they can no longer be sued.  Id. at 740.  This certainty would not arise if statute of limitations were tolled pending writs of certiorari to SCOTUS.  Id. These writs do not have to be filed until 90 days (3 months) after the opinion or order, and can take months to resolve.  Id. Considering that the majority of these are largely denied, the uncertainty associated with tolling the period during this time is great. 

In contrast, remittitur is a set date.  Id. at 740.  It issues 25 days after the final decision by the NVSC.  NRAP 41(a)(1). 

The NVSC further noted that remittitur can be stayed pending a writ of certiorari to SCOTUS under NRAP 41(b)(3).  Branch Banking, 432 P.3d at 740-41.  To stay remittitur, you simply have to file a motion to stay while the writ of certiorari is pending.  NRAP 41(b).  Remittitur will be stayed for 120 days (4 months).  You can extend the period of time for good cause (i.e., “SCOTUS hasn’t rejected or accepted our writ yet”).  See id. The 120 day period will be indefinitely extended if your writ is accepted, and remittitur will remain stayed until SCOTUS files its disposition of your appeal.  See id.

Branch Banking and Trust never sought to stay remittitur.  432 P.3d at 741.  Once remittitur issued, the limitations period began running for its lawsuit against its former attorney.  Because Branch Banking and Trust filed its legal malpractice action outside of the two-year limitation period, the district court properly dismissed its action.  Id

AND THE MORAL OF THIS STORY IS…

Don’t sue your lawyer.   

Just kidding. Sort of. 

But if you are going to sue your lawyer, pay attention to when that clock starts ticking on the limitations period.  

Hall v. Hall Revisited: In re Estate of Sarge

The Nevada Supreme Court has joined SCOTUS in holding that an order resolving one consolidated matter is independently appealable.  Hall v. Hall, 128 S. Ct. 54, 198 L.Ed.2d 780 (Sept. 28, 2017); In re Estate of Sarge, 134 Nev., Adv. Op. 105, 432 P.3d 718 (2018).  I discussed the Hall opinion HERE.

Prior to Hall, the rule in Nevada was that a consolidated case could not be independently appealed.  Mallin v. Farmers Ins. Exchange, 106 Nev. 606, 608-09, 797 P.2d 978, 980 (1990).  Following Hall, however, the NVSC overruled MallinSarge, 432 P.3d at 722. It found that Mallin did not address Rule 42 and relied upon Ninth Circuit precedent that was overruled in Hall.  Id.  The NVSC further noted that Mallin overlooked an earlier NV court case which stated that consolidated cases were independently appealable.  Id. at  721.  Reasoning that it should never allow its prior decisions to operate as a “straight jacket,” the NVSC overruled Sarge and held that consolidated cases are now independently appealable.   

Protecting Your Pocket: When Attorney Fees and Costs are Recoverable on Appeal

Getting saddled with an appeal after you have won a case  can be a bitter pill to swallow.  Continuing to pay an attorney who you thought you were done paying only rubs into the wound.  Here’s how you might be able to recover attorney fees on appeal.

ATTORNEY FEES ON APPEAL ARE ONLY AWARDED FOR “FRIVOLOUS” APPEALS

A Nevada appellate court will only award attorney fees on appeal if:

  • “an appeal has been frivolously taken or processed in a frivolous manner;”
  • The appeal was filed solely to delay; or
  •  a party abuses and misuses the appellate process for some purpose other than resolving an appeal.

NRAP 38(b).  The Nevada Supreme Court can also award monetary sanctions if it finds that an appeal is frivolous. NRAP 38(a).

Awards of attorney fees on appeal under NRAP 38 are rare.  The appellate courts have substantial discretion to award these fees, and they rarely exercise that discretion.  Bd. of Gallery of History, Inc. v. Datecs Corp., 116 Nev. 286, 288 n.2, 994 P.2d 1149, 1150 n.2 (2000).

An appeal is not frivolous merely because the party lost.  See, e.g., Bobby Berosini, Ltd. v. PETA, 114 Nev. 1348, 1356-57, 971 P.2d 383, 388 (1998); Edington v. Edington, 119 Nev. 577, 588, 80 P.3d 1282, 1290 (2003).

NRAP 38 truly comes into play when the opposing party’s conduct has been dishonest, disruptive, and fails to comply with the rules of appellate procedure.

For example, in Varnum v. Grady, the Nevada Supreme Court imposed monetary sanctions because the appellant failed to abide by five procedural requirements relating to transcripts, record designation and filing fees.  90 Nev. 374, 375-77, 528 P.2d 1027, 1028 (1974).  After the respondent moved to dismiss the appeal, the appellant argued that its counsel should be excused for not following the rules because he was involved in a trial and working on other briefs.  Id.  Needless to say, the Nevada Supreme Court completely rejected the argument, refused to accept counsel’s preoccupation with other cases as a valid excuse, and found that the appellant’s prosecution of its appeal was dilatory and warranted monetary sanctions.  Id.

Sanctions can also be issued against respondents.  In Sobol v. Capital Management Consultants, Inc., the Nevada Supreme Court issued sanctions against the respondent because of its “blatant misrepresentation of the stipulated facts” in its brief, and because it quoted language from a dissent in a case as if it were “the holding of the case.”  102 Nev. 444, 446-47, 726 P.2d 335, 337 (1986).  The Nevada Supreme Court not-so-gently reminded the respondent that it “expect[s] and require[s] that all appeals . . . will be pursued in a manner meeting high standards of diligence, professionalism, and competence.”  Id. (Internal quotations omitted).

The Nevada Supreme Court has also made it clear that a voluntarily dismissed appeal is not automatically “frivolous” so as to warrant an award of attorney fees.  Breeden v. Eighth Judicial Dist. Ct., 131 Nev., Adv. Op. 12, 343 P.3d 1242, 1243 (Nev. 2015).  In Breeden, the Nevada Supreme Court rejected the argument that fees should be awarded under NRCP 42(b) and NRAP 38 for voluntary dismissal of appeals because “courts encourage rather than discourage voluntary, self-determined case resolutions.”  Id.

COSTS ON APPEAL ARE A DIFFERENT STORY

Unlike attorney fees, costs are frequently recoverable on appeal under NRAP 39.

How an appeal is resolved determines who has to pay the costs.  Here’s how Rule 39 works:

  • If the appeal is dismissed, the appellant has to pay the costs unless the parties agree otherwise.
  • If the judgment is affirmed, the appellant has to pay the costs (because they lost).
  • If the judgment is reversed, the respondent has to pay the costs (because they lost).
  • If the judgment is affirmed in part and reversed in part, then costs are only recoverable if the appellate court orders (because everybody won but also lost).

NRAP 39(a).

The costs that you can recover include:

  • Costs of copying for “necessary” copies of briefs and appendixes
  • Costs of roundtrip transportation for oral argument. These are limited to the distance between the district court and the appellate court (i.e., your New York lawyer can’t charge for flying from New York to Vegas).  The costs are further limited to 15 cents per automobile mile or the cost of commercial airfare, whichever is lowest.
  • Preparation and transmission of the record
  • Reporter’s transcript
  • Preparation of appendix
  • Premiums paid for supersedeas or other bonds filed upon appeal
  • The filing fee for the appeal

NRAP 39(c), (e). Costs for copies and transportation are capped at $500.  NRAP 39(c)(5).  For estimation of other appeal costs, read this post.

To recover these costs, you must file an itemized and verified bill of costs with the appellate court within 14 days after the order or opinion is issued.  NRAP 39(c)(3).    The costs are actually awarded in the remittitur.  NRAP 39(d).  If remittitur issues before costs are determined, then the district court adds the statement of costs to the remittitur.  Id. And if you have no clue what “remittitur” is, read this post.

DON’T FORGET OFFERS OF JUDGMENT

If you had fees awarded pursuant to an offer of judgment in the district court, you may be able to recover fees incurred upon appeal under that same offer of judgment.   NRCP 68 “extend[s] to fees incurred on and after appeal.”  In re Estate & Living Tr. of Miller, 125 Nev. 550, 555, 216 P.3d 239, 243 (2009).  Keep in mind, however, that the appellate court’s ruling regarding the offer of judgment on appeal will govern whether you can recover fees because the appellate court’s ruling is the law of the case.  Bd. of Gallery of History, Inc., 116 Nev. at 289, 994 P.2d at 1150.  This means that an order or opinion affirming the award under the offer of judgment only leaves the question of whether your fees incurred on appeal were reasonable.  Likewise, an order reversing the judgment may result in a finding that your offer was unreasonable, and you are not entitled to any fees.

 

 

The ABC’s of Notices of Appeal

To begin your appeal, you must file a notice of appeal.  NRAP 3; FRAP 3.  Although it seems simple, you can really screw your appeal up if you do not know what the notice of appeal must contain.  Here’s a quick breakdown:

WHO CAN FILE THE NOTICE OF APPEAL

A lawyer with client authority

Generally, your counsel (or yourself, if you are unrepresented and appearing pro se) files the notice of appeal.  However, an attorney cannot file a notice of appeal on your behalf without your consent.  The Comm’n on Ethics of the State of Nev. v. Hansen, 134 Nev., Adv. Op. 40, 419 P.3d 140, 142 (Nev. 2018).  If your attorney files a notice of appeal on your behalf before you have given them consent, the notice of appeal is defective. Id.

Hansen is the most recent decision of the Nevada Supreme Court to address effective notices of appeal.  Hansen involves the tragic tale of poorly placed hunting traps, two assemblyman, one self-proclaimed “local watchdog,”  the Nevada Commission on Ethics, and a partridge in a pear tree.  Id. at 140.

In a crazy plot twist, the partridge was not snared by the traps.  Instead, the assemblyman who placed them was snared, or cited, by the Nevada Department of Wildlife for violating a statute regarding their placement.  After his fellow assemblyman requested a Legislative Counsel Bureau opinion as to whether the traps violated the statute, a local watchdog then filed an ethics complaint against both men with the Commission for allegedly abusing their positions.   Id. at 140.

After the Commission refused to dismiss the ethics complaint, the assemblymen filed a petition for judicial review.  Id.  The district court agreed that the ethics complaint should be dismissed.  Id.  The Commission did not, and filed a notice of appeal.  Id.

When I say “Commission,” I actually mean the Commission’s counsel filed the notice of appeal, and he did so after only consulting with the chair and executive director rather than the entire Commission.  Id.  When you are a lawyer, and you represent an organization, the entire organization is the client.  NRPC 1.13(a).

In Hansen, the Nevada Supreme Court dismissed the appeal because the “client,” i.e., the Commission, did not give the attorney authorization prior to filing the notice of appeal.  Id. at 142.  The Court reasoned that an appeal is a decision that a public body must hold a public meeting and vote upon because it requires commitment of public funds.  Id.  Since that did not happen prior to filing the notice of appeal, the Court dismissed the appeal for being defectively noticed.  Id.

Multiple parties with common interests on appeal

With authority, your attorney can file a notice of appeal on your behalf.  If you are an attorney who represents multiple clients, you can file a “joint notice of appeal.”  NRAP 3(b)(1); FRAP 3(b)(1).  If you have co-parties whose interests are aligned with yours but who are represented by separate counsel, you can also file a joint appeal.  Id.  On appeal, the parties will be treated as individual appellants. Id.   You can also file separate notices of appeal, and seek consolidation or joinder.  NRAP 3(b)(2); FRAP 3(b)(2).

WHAT HAPPENS IF YOU SCREW UP THE NOTICE OF APPEAL 

Even if you screw up the notice of appeal, the district court clerk must still file it and notify the Nevada Supreme Court, and the Nevada Supreme Court clerk must accept it and assign it an appeal number.  NRAP 3(a)(2)-(3).  The Ninth Circuit does not require the same of its courts, and a procedurally defective notice of appeal may result in immediate dismissal without prejudice.  See FRAP 3.

The only court that can dismiss an appeal for a defective notice of appeal is the appellate court, not the district court.  The district court’s obligation is to keep a clear record of the case, including any deficiency in the notice of appeal.  Whitman v. Whitman, 108 Nev. 949, 951, 840 P.2d 1232, 1233 (1992).  While the district court should inform the appellant of procedural deficiencies, it must still file the notice of appeal. Id.

WHAT YOU NEED TO INCLUDE IN THE NOTICE OF APPEAL 

The notice of appeal needs to include three main items:

1.  The Identity of the Parties on Appeal 

The notice of appeal should designate the appellant, the respondent, and any other interested parties.  NRAP 3(c)(1)(A); FRAP 3(c)(1)(A).  If you have counsel, the notice of appeal should also state which parties that attorney represents on appeal. Id.

2.  The Judgment or Order Being Appealed 

This is the most important thing to include in your notice of appeal.  Any “appealable judgment or order that is not designated in the notice cannot be considered on appeal.”  Abdullah v. State, 129 Nev. 86, 91, 294 P.3d 419, 422 (2013).  If you leave it out, you have not appealed it.  Always identify all orders and judgments on appeal.  NRAP 3(c)(1)(B); FRAP 3(c)(1)(B).

3.  The Court To Which You Are Appealing 

You must state the court to which you hope to appeal.  NRAP 3(c)(1)(C); FRAP 3(c)(1)(C). This is very simple. In Nevada, all appeals are first filed in the Nevada Supreme Court.  If you appeal from district court, you simply have to state you are appealing to the Nevada Supreme Court.  Once the appeal is docketed, and your briefs are filed, the Nevada Supreme Court will determine whether to assign the case to the Court of Appeals.  NRAP 17.

In the Ninth Circuit, your appeal will almost always go to the Ninth Circuit Court of Appeals.

HOW YOU FILE A NOTICE OF APPEAL

Your notice of appeal must be filed with the district court clerk.  NRAP 3(d); FRAP 3(a).  In Nevada, you must serve a copy on all other parties by either mailing it to their last known address, or their lawyer.  NRAP 3(d)(1).  In the Ninth Circuit, the federal district court clerk must serve the notice on all parties.  FRAP 3(d)(1).  If the federal district court clerk fails to serve the notice of appeal, your notice of appeal is still effective.  FRAP 3(d)(3).

 

When Two Do Not Become One: Appealability of Judgments in Consolidated Cases

In Hall v. Hall, the United States Supreme Court (SCOTUS) answered the burning question that … okay, that probably no one has been dying to have answered.  But nevertheless, it is good to know for appellate practice.  When you consolidate cases under Rule 42, can you separately appeal a judgment obtained in one case even if a final judgment has not been entered in the other consolidated case?  According to SCOTUS, yes.  Hall v. Hall,  584 U.S. ___, 138 S. Ct. 1118, 200 L.Ed.2d 399 (Mar. 27, 2018).

CONSOLIDATION IS NOT UNIFICATION

When you have two similar cases, you can move the court to consolidate them under Rule 42.  When cases are “consolidated,” they are heard by the same judge.  They may also be tried at the same trial.

Consolidation has been around since before Abraham Lincoln was a twinkle in his mother’s eye.  In 1813, Congress passed a statute allowing courts to consolidate related actions. § 3, 3 Stat. 21.  Under this statute, SCOTUS consistently refused to recognize “consolidated” cases as being “unified” for all purposes.

For example, in Rich v. Lambert, SCOTUS declined to exercise jurisdiction over several consolidated maritime appeals because each case did not individually involve at least $2,000 in damages, and (at that time) SCOTUS only had jurisdiction over maritime cases where the amount in issue was in excess of $2,000.  12 How. 347, 352-53, 13 L.Ed. 1017 (1852).

In Mutual Life Insurance Co. v. Hillmon, SCOTUS reversed a court order treating three separate lawsuits against three separate defendants as one merely because the three separate lawsuits against each defendant were consolidated.  145 U.S. 285, 293, 12 S. Ct. 909, 36 L.Ed. 706 (1892).  Poor Mrs. Hillmon had to file three separate lawsuits against three separate life insurance companies for release of three separate life insurance policies on her husband who she claimed had died while traveling through southern Kansas.  Id. at 285-87.  The insurance companies claimed it was insurance fraud, that Mr. Hillmon was still alive, that he had conspired with his traveling companion to murder their other traveling companion, and that they were trying to pass off that poor schmuck’s corpse as Mr. Hillmon.  Id.  The cases were consolidated.  At trial, when the individual insurance companies each tried to challenge potential jurors for jury duty disqualification, the court limited their challenges to the amount normally allowed in one case rather than allow them to have the amount allowed in three cases.  Id.  According to SCOTUS, the fact that the cases were consolidated did not negate the individual defendants’ rights to have the full amount of peremptory (i.e., juror) challenges available to them in their separate lawsuits.  Id.  at 293.

(I don’t know if Mr. Hillmon was actually alive at the time of trial, but he is definitely dead now.)

In Stone v. United States, SCOTUS did not allow the appealing party to raise issues on appeal that were related to a consolidated case whose judgment he had not also appealed.  167 U.S. 178, 189, 17 S. Ct. 778, 42 L.Ed. 127 (1897).

In Johnson v. Manhattan R. Co., SCOTUS affirmed Judge Learned Hand’s decision that consolidation does not automatically make the parties to one lawsuit also parties to the consolidated lawsuit.  289 U.S. 479, 496-497, 53 S. Ct. 721, 77 L.Ed. 1331 (1933).

In 1935, Rule 42(a) was adopted, and expressly allowed for consolidation of cases raising similar facts, issues and/or containing similar parties.

Following the adoption of Rule 42(a), SCOTUS continued to reject the theory that “consolidation” means “unification.”  In Butler v. Dexter, SCOTUS dismissed an appeal because the constitutional question that gave SCOTUS jurisdiction was not raised in the appealed case, but in the other consolidated cases which were not appealed.  425 U.S. 262, 266-67, 96 S. Ct. 1527, 47 L.Ed.2d 774 (1976).

ALONG COMES THE HALLS

One very important thing you should know about the above opinions is that SCOTUS never stated outright “Yes, you can separately appeal cases even if they have been consolidated under Rule 42.”  Apparently, you really have to spell these things out for lawyers.

Which brings us to the case of poor Samuel Hall (coincidentally, a lawyer).  Samuel does not like his sister Elsa, and the feeling is mutual.  Samuel used to take care of his mother, until she got mad at something Samuel did with her real estate.  Hall, 138 S. Ct. at 1122.  His mother then created a trust, transferred all of her property into it, made herself trustee, and made Elsa the beneficiary of the property upon her death.  Id. The mother also moved to live with Elsa and the move, according to SCOTUS was “under circumstances disputed by the parties.”  Id.

(I don’t know what that means, but it screams “kidnapped and transported in a container ship.”  The mom lived in the Virgin Islands with Samuel, and relocated to Miami with Elsa).

The mom eventually sued Samuel and his law firm on behalf of her trust for whatever it is that Samuel allegedly did to her real estate. Id.  The mom died, and Elsa became the trustee tasked with prosecuting the lawsuit against Samuel.  Id.  Samuel then filed a separate lawsuit against Elsa for whatever it is that she allegedly did to their mom.  Id. at 1123.  The cases were consolidated, and tried in one trial.  Id.

Elsa lost.  She lost the trust case, and Samuel won on his claims against her in the individual case.  Id.  Elsa was able to overturn the jury verdict in the trust case, reopening the litigation.   Id.  However, the jury verdict against Elsa in the individual case stood, and Elsa appealed that verdict.  Id.  Samuel argued that the verdict in the individual case was not a final appealable judgment because the claims in the trust case remained pending. Id.  The Third Circuit Court of Appeals agreed.  Id.  SCOTUS did not.

According to SCOTUS, “[h]ad the District Court never consolidated the trust and individual cases, there would be no question that Elsa could immediately appeal from the judgment in the trust case.”  Id.  Relying on its  history of viewing consolidated cases as retaining their separate identity, SCOTUS rejected Samuel’s argument and reversed the Third Circuit.  It finally stated, clear enough for lawyers to understand, “that when one of several consolidated cases is finally decided, a disappointed litigant is free to seek review of that decision in the court of appeals.”  Id. at 1131.

And everybody lived happily ever after.  Except for the Halls, who are probably still suing each other, and also Mr. Hillmon, who is definitely now dead.

The Costs of an Appeal: What You Have To Pay to Play

You probably know you have a right to an appeal, but do you know what that right costs?  Here’s a breakdown of the filing fees associated with appeals:

FEE TO APPEAL

To file an appeal, you have to pay a fee in the district court.  For appeals and cross-appeals to Nevada appellate courts, that fee is $250.  NRS 2.250.  For Ninth Circuit Appeals, the fee is $505.

If you wish to file an appeal with the United States Supreme Court, the fee to appeal is paid directly to the United States Supreme Court.  The cost to file a petition for a writ of certiorari, jurisdictional statement, or original action is $300. Sup. Ct. R. 38.

FEES FOR OTHER PROCEEDINGS

Remember, an appeal is not the only way that you can seek appellate review.  To file a petition for an extraordinary writ to the Nevada Supreme Court and/or Nevada Court of Appeals, you must pay a fee of $250 to the district court.  NRS 2.250.  However, there is no fee for criminal proceedings and habeas corpus petitions.

To file a petition for review or a petition for a writ of mandamus in the Ninth Circuit, you must pay a fee of $500.

To file an original action in the United States Supreme Court, you must pay a fee of $300.

PETITIONS FOR REHEARING OR EN BANC RECONSIDERATION 

In Nevada, following a decision by the appellate court, you can  seek  rehearing or en banc reconsideration.  The cost to file a petition for rehearing is $150.  NRS 2.250.

You can also file a petition for rehearing or a motion for leave to seek rehearing in the United States Supreme Court.  The costs for these rehearing petitions and/or motions is $200. Sup. Ct. R. 38.

MISCELLANEOUS COSTS 

There are miscellaneous costs which the appellate court may charge you of which you should be aware.  These include (1) copies, (2) certified copies, (3) duplication of audio files (i.e., oral argument), and (4) transcript examination fees.  These costs are generally minimal.  (For example, copies in both Nevada and the Ninth Circuit are 50 cents per page).

Both the Ninth Circuit and the United States Supreme Court will also charge you fees for returned checks, so make sure your bank account is current.

WHEN COSTS ARE WAIVED 

In certain types of appeals, costs are waived.  For example, the United States Supreme Court does not charge the above costs for appeals in: (1) Veteran’s re-employment cases; (2) seamen’s cases; and (3) cases initiated by persons who have been accused by the Court of Appeals for the Armed Forces.  Sup. Ct. R. 40.1; Sup. Ct. R. 40.2; and Sup. Ct. R. 40.3.

The most common appeals in which costs are not charged are those in which the appellant is granted leave to proceed in forma pauperis.  An appellant will granted leave to proceed in forma pauperis upon a finding that they cannot afford to pay the appellate fees.  NRAP 24; FRAP 24; Sup. Ct. R. 39.  In both Nevada and the Ninth Circuit, the appellant must first file a motion in the district court that sets forth their inability to pay the costs on appeal.  NRAP 24(1); FRAP 24(1).  The motion must (a) show financial inability to pay appeal fees, (b) demonstrate that the appellant is entitled to some form of relief, and (c) state the issues on appeal.  Id.  If, and only if, the motion is denied by the district court, may the appellant  file a motion with either the Nevada appellate courts or the Ninth Circuit again seeking leave to proceed in forma pauperis. NRAP 24(5); FRAP 24(5).

In the United States Supreme Court, the party seeking leave to proceed in forma pauperis must file a motion with the Supreme Court which complies with the Ninth Circuit’s requirements (i.e., it must (a) show financial inability to pay appeal fees, (b) demonstrate that the appellant is entitled to some form of relief, and (c) state the issues on appeal).  Sup. Ct. R. 38(1).

Although these fees may seem steep, they are a necessary evil for the orderly operation and administration of appellate courts.  If you are contemplating an appeal, or have a client contemplating an appeal, always be aware of what you have to pay to play.

You Do Not Have A Constitutional Right to Hire a Prostitute (Duh)

The Ninth Circuit recently ruled that there is no constitutional right for a private citizen to have sexual relations with prostitute.  Erotic Serv. Provider Legal Educ. & Research Proj. v. Gascon, 880 F.3d 450 (9th Cir. 2018).   

I hope you were sitting down for that bombshell.

Erotic Service Providers Legal Education and Research Project (“ESP”) consists of “three former ‘erotic service providers’ who wish to perform sex for hire, and a potential client who” wants to hire them.  880 F.3d at 454.  ESP claimed that California Penal Code § 647(b), which criminalizes prostitution, violates (1) the Fourteenth Amendment substantive due process right to sexual privacy, (2) freedom of association under the First or Fourteenth Amendment, (3) the Fourteenth Amendment substantive due process right to earn a living, and (4) the First Amendment freedom of speech.   Almost all of ESP’s claims were based upon the United States Supreme Court’s decision in Lawrence v. Texas, 539 U.S. 558 (2003).  The Ninth Circuit completely disagreed with ESP and its interpretation of Lawrence.

Here’s what you need to know:

Once Upon a Time, People Kept Suing and Losing For the Right to Hire Prostitutes

It should come as no surprise that the question of whether we have a constitutional right to hire prostitutes has been heavily litigated in our nation’s history.  Prostitution is, after all, colloquially referred to as the world’s oldest profession.

In 1988, the Ninth Circuit addressed and rejected the argument that the freedoms of association guaranteed by the First and Fourteenth Amendments protected anyone’s right to hire an escort.  IDK, Inc. v. Clark Cnty., 836 F.2d 1185 (9th Cir. 1988).  IDK, Inc. was an escort service based out of Las Vegas that argued Clark County’s regulations governing the licensing and operations of escort companies violated it and its clients’ First and Fourteenth Amendment rights to association.  Id. at 1187.

The Fourteenth Amendment of the United States Constitution protects the right to form “intimate associations.” Roberts v. United States Jaycees, 468 U.S. 609, 617-18 (1984).  The traditionally protected forms of “intimate associations” have been defined as “highly personal relationships,” and “those that attend the creation and sustenance of a family.”  Id. at 618-19.

In IDK, the Ninth Circuit rejected the argument that the relationship between an escort and a client was the type of “highly personal relationship” traditionally protected by the Fourteenth Amendment.  836 F.2d at 1193.  It reasoned:

The relationship between escort and client possesses few, if any, of the aspects of intimate association.  It lasts for a short period and only as long as the client willing to pay the fee.  Although a client may have some choice as to the person he or she wishes as a  companion, the escort must accompany whomever the employer selects.  Escorts and their clients do not claim to be involved in       procreation, raising and educating children, cohabitation with relatives, or the other activities of family life.  An escort may be involved with a large number of clients.  While we may assume that the relationship between them is cordial and that they share conversation, companionship, and the other activities of leisure, we do not believe that a day, an evening or even a weekend is sufficient time to develop deep attachments or commitments.

Id.

The Ninth Circuit also rejected the argument that the relationship between an escort and a client is protected by the First Amendment’s freedom of “expressive association.”  “Expressive association” generally protects activities like protests, assemblies, and any other gathering aimed at promoting religious, social or political speech.  Roberts, 468 U.S. at 622.

The Ninth Circuit found that there was no evidence that escort services include “expression [as] a significant or necessary component of their activities.”  Id. at 1195.  It reasoned that escort companies don’t advertise their employees’ skills in conversation or community service; therefore, it assumed “that clients select their companions on the basis of other criteria.” Id.  Plus, “[i]f a client does not care to engage in expressive activities while dating, we must assume that neither the escort services nor the escort compel the client to do so.  The escort services simply do not care what the couples talk about or whether they talk at all.”  Id. at 1196.  Accordingly, the Ninth Circuit rejected IDK’s argument that it had a constitutional right to offer escort services under the First and Fourteenth Amendment’s freedom of association.

Two years after IDK, the Movie “Pretty Woman” Was Released.

It didn’t change anything.

It just made Julia Roberts even more famous.

But Then Along Came Lawrence v. Texas

In 2003, the landscape of intimate association law changed when the United States Supreme Court issued its opinion in Lawrence v. Texas.  If you are unfamiliar with Lawrence, it is one of the landmark cases in gay rights.

Lawrence challenged the validity of Texas statute that criminalized certain types of sexual activity between members of the same sex.  539 U.S. at 563.  Speaking for the majority of the Court, Justice Kennedy struck down the Texas statute as unconstitutional under the freedom of association guaranteed by the Due Process Clause of the Fourteenth Amendment.  He reasoned that anti-homosexual statutes “seek to control a personal relationship that, whether or not entitled to formal recognition in the law, is within the liberty of persons to choose without being punished as criminals,” and “[t]he liberty protected by the Constitution allows homosexual persons the right to make this choice.”  Id. at 567.  In reaching his holding, Justice Kennedy held:

The case does involve two adults who, with full and mutual consent from each other, engaged in sexual practices common to a           homosexual lifestyle.  The petitioners are entitled to respect for their private lives.  The State cannot demean their existence or control their destiny by making their private sexual conduct a crime.  Their right to liberty under the Due Process Clause gives them the full right to engage in their conduct without intervention of the government.

Id. at 578.

12 years after Lawrence, Justice Kennedy again drew upon this reasoning and ruled that “the right to marry is a fundamental right inherent in the liberty of the person, and under the Due Process and Equal Protection Clauses of the Fourteenth Amendment couples of the same-sex may not be deprived of that right and that liberty.”  Obergefell v. Hodges, 135 S. Ct. 2584, 2604-2605 (2015).

One thing that Lawrence did not address is the right to hire a prostitute.  To the contrary, Justice Kennedy specifically remarked that Lawrence did “not involve public conduct or prostitution.”  539 U.S. at 578.

Enter ESP and A Shocking Number of Other Lawsuits

Following Lawrence, people began suing all over the country for their right to “associate” with prostitutes by paying them to engage in private sexual activity.  And the courts, all over the country, declined to interpret Lawrence as protecting prostitution since Lawrence expressly stated that its holding did not involve claims related to prostitution.  See, e.g., State v. Thomas, 891 So. 2d 1233 (La. 2005);  United States v. Thompson, 458 F. Supp.2d 730 (N.D. Ind. 2006); State v. Romano, 155 P.3d 1102 (Haw. 2007); United States v. Palfrey, 499 F. Supp. 2d 34 (D.D.C. 2007); Lowe v. Swanson, 639 F. Supp. 2d 857 (N.D. Ohio 2009); Doe v. Jindal, 851 F. Supp. 2d 995 (E.D. La. 2012).

In 2015, ESP joined in the fun and filed its lawsuit claiming that California’s anti-prostitution law violated the Due Process Clause of the Fourteenth Amendment, the Freedom of Association guaranteed by the Fourteenth Amendment, the constitutional right to earn a living, and First Amendment freedom of speech.  880 F.3d 450.  The Ninth Circuit disagreed.

ESP relied heavily on Lawrence to assert its Fourteenth Amendment claims.  It argued that Lawrence should be interpreted as guaranteeing “consenting adults a fundamental liberty interest to engage in private sexual activity,” which would prohibit a state from outlawing commercial exchanges of such private sexual activity. Id. at 455-56.  It also argued that Lawrence overruled IDK.  Id. at 456.

The Ninth Circuit rejected ESP’s argument that consenting adults have a fundamental liberty interest to have sex with a prostitute.  The evidence made it clear that California has a strong, legitimate reason for criminalizing prostitution because: (1) prostitution is linked to sex trafficking; (2) “prostitution creates a climate conducive to violence against women;” (3) there is “a substantial link between prostitution and illegal drug use;” and (4) “prostitution is linked to the transmission of AIDS and other sexual transmitted diseases.”  Id. at 458.

The Ninth Circuit also rejected ESP’s argument that the freedom of intimate association guaranteed by the Due Process Clause extends to commercial relationships with prostitutes.  Finding that Lawrence did not overrule IDK, the Ninth Circuit applied IDK to reject this claim.  Id. at 458-59.

Next, the Ninth Circuit rejected ESP’s argument that California’s anti-prostitution laws violate the Fourteenth Amendment’s right to earn a living.  Because Lawrence specifically stated it did not encompass prostitution, ESP failed to provide any law which supported a protected employment right in prostitution.  Since California’s laws applied to equally anyone and everyone, the law withstood constitutional scrutiny.  Id. at 459.

Finally, the Ninth Circuit rejected ESP’s claim that the solicitation of commercial sex is protected commercial speech under the First Amendment.  The First Amendment has never protected “commercially motivated speech that involved unlawful activity.”  Id. at 460.

Why ESP Matters to the 98% of the Population That Doesn’t Solicit Prostitutes

The evolution of our constitutional right of intimate association is a fascinating one in our nation’s history.  It is the basis upon which women have been guaranteed the right to use birth control and to obtain abortions.  Griswold v. Connecticut, 381 U.S. 479 (1965); Eisenstadt v. Baird, 405 U.S. 438 (1972); Roe v. Wade, 410 U.S. 113 (1973).  As you read above, it is the basis upon which same sex relationships and marriage have been protected.  And, as ESP demonstrates, it is probably going to continue being the basis on which people advocate for legalization of commercial sex.  Whether that will happen, I do not know.  But, as Justice Kennedy observed: “As the Constitution endures, persons in every generation can invoke its principles in their own search for greater freedom.”  Lawrence, 539 U.S. at 579.

Timely Appeals: Hamer v. Neighborhood Housing Services of Chicago

The notorious RBG laid down the hammer on the Seventh Circuit in Hamer v. Neighborhood Housing Services of Chicago, after the Seventh Circuit held that FRAP 4(a)(5)(C)’s time limitations on filing appeals are jurisdictional.  According to RBG (Justice Ruth Bader Ginsburg), time limitations in FRAP 4(a)(5)(C) are “mandatory” (i.e., follow them) but not jurisdictional.

Charmaine Hamer lost her employment discrimination lawsuit against Neighborhood Housing Services of Chicago.  Six days before the deadline for her to appeal, her attorneys moved to withdraw and requested an extension of the appeal filing deadline.  The district court granted both motions and gave Hamer a 60-day extension on her appeal filing deadline.  The Seventh Circuit dismissed the appeal as untimely, because FRAP 4(a)(5)(C) only allows the district court to grant a 30-day extension.  RBG disagreed.

Statutes vs. Rules

The crux of Hamer is the distinction between statutes and rules.  A statute is enacted by Congress (or a state legislature).  A rule is created by courts.  Both must be followed by litigants, but a litigant’s failure to follow a rule is not necessarily fatal.

In Bowles v. Russell, the United States Supreme Court held that time limitations for filing an appeal which are found in statutes are jurisdictional.  551 U.S. 205, 210-12 (2007).  “Jurisdiction” of federal courts is determined by Congress.  Because Congress can decide what type of cases the federal courts can hear, Congress can naturally also decide when the federal courts can hear these cases.  Id.   Therefore, when Congress enacts a time limit on when an appeal must be filed, an appellant’s failure to follow the statutory time limit requires dismissal because these time limitations are jurisdictional.

Hamer dealt with a rule, not a statute.  According to RBG, the rules are different when it comes to dealing with . . . rules.

RBG Lays Down a Rule About a Rule

Unlike statutes, the federal rules of appellate procedure were created by the courts to promote order in litigation.  Hamer v. Neighborhood Housing Servs. of Chicago, 583 U.S. ____, 183 S. Ct. 13, 17 (Nov. 8, 2017).  While time limits in statutes cannot be waived by the parties, defects in timeliness arising under rules can. Id.

Normally, an appeal from a federal district court to a court of appeals must be filed within thirty (30) days from the entry of the judgment or order.  FRAP 4(a)(1)(A).   A party can move the district court for an extension of the time to appeal.  FRAP 4(a)(5)(A).  The district court can only grant an extension of “30 days after the prescribed time or 14 days after the date when the order granting the extension is entered, whichever is later.”  FRAP 4(a)(5)(C).

The respondents tried to argue that FRAP 4(a)(5)(C) had a “statutory basis” because it is similar to an actual statute, 28 U.S.C. 2107(c).  However, 28 U.S.C. 2107(c) only applies if the appellant did not have notice of the judgment against them.   Hamer was well aware of the order ending her lawsuit.

Because Hamer’s time period to appeal arose from a rule, the Seventh Circuit should not have dismissed her appeal for lack of jurisdiction.  According to RBG, time limitations are only jurisdictional if they are prescribed by Congress.  Time periods for appeals found in the rules may be waived or forfeited.  On remand, the Seventh Circuit will need to decide whether Neighborhood Housing Services’ failure to object to the 60-day (as opposed to 30-day) extension waived any right to contest the timeliness of Hamer’s appeal, and/or whether it should hear the appeal because Hamer relied on the district court’s error in allowing her to file her appeal 60 days after the order dismissing her case.

Moving Forward under Hamer

Hamer is the final say in long debate among the federal appellate courts as to whether an appeal must be dismissed when it is untimely under the Federal Rules of Appellate Procedure or whether the courts may excuse the untimeliness.

Moving forward under Hamer, federal litigants need to be aware of the following:

(1) If your timeline to appeal arises under a statute, you need to file within that timeline;

(2) If your timeline to appeal arises under a rule, you should still file within that timeline, but your failure to do so may not always result in dismissal;

(3) If you are responding to an untimely appeal that was filed pursuant to a rule, object to its untimeliness or the federal court can treat your untimeliness objection as “forfeited” and hear the appeal anyway.

Whatever you do, follow the rules.  Although untimeliness may be forgiven in some cases, I highly doubt an appellate court is going to forgive an untimely appellant who simply disregarded the rules.

 

 

Congratulations, You Lost: a Basic Explanation of How the Appellate Process Works

There are three outcomes to litigation:  you win, you lose or you settle.  If you’ve settled, this is not the site for you.  If you’ve lost, congratulations on being a big, fat loser!  You get to appeal.  If you’ve won, please accept my condolences because the other side will most likely challenge that win on appeal.

Now that I have either ruined or made your day, let me give you a brief explanation of how the appellate system works.

HOW THE APPELLATE SYSTEM WORKS

When a case ends before the district court (the lower court), either party has the right to an appeal.  The appeal process is started by filing a notice of appeal to the next highest court.  Generally, court systems are structured like a staircase.  First, you must litigate in the lower court (step 1).  Then, you may appeal that decision to an intermediate appellate court (step 2).  After the intermediate appellate court decides your case, you can proceed to the highest, or the “supreme” court (step 3).  Seems pretty simple, right?  Unfortunately, the appellate process is a little more complicated than that.  Here’s a breakdown.

Nevada 

In Nevada, the appellate system looks more like an elevator and less like a traditional staircase.  Once you have lost in the district court, you file your appeal directly with the Nevada Supreme Court.  The Nevada Supreme Court is the highest court in the state.  The Nevada Supreme Court then decides whether your case will be sent back down to be heard by the Nevada Court of Appeals, the intermediate appellate court, or whether it will bypass the Court of Appeals and go straight to the Nevada Supreme Court.

If your case is assigned to the Nevada Court of Appeals, and you lose again, you can petition for review of that decision by the Nevada Supreme Court.  For cases assigned to the Court of Appeals, you are not automatically granted the right to have the Nevada Supreme Court hear your appeal.  If The Nevada Supreme Court declines to hear your appeal, your case is over.

If your appeal bypasses the Nevada Court of Appeals, and is heard by the Nevada Supreme Court, and you lose, you can petition the United States Supreme Court to hear your case.  Again, you are not automatically granted the right to have the United States Supreme Court hear your appeal.  If the United States Supreme Court declines to hear your appeal, your case is over.  If it grants your petition, your case is over once the United States Supreme Court hears the appeal.  The United States Supreme Court is the highest court in the country.  Except for maybe God, there is no one else who is going to hear your case after their decision.   

Federal

The federal system resembles a traditional staircase.  Once you have lost in federal district court, you file an appeal with the intermediate federal appellate court for that “circuit,” i.e., area of the country.  In Nevada, your federal appeal would go to the Ninth Circuit Court of Appeals.

If you lose in the Ninth Circuit, you may petition the United States Supreme Court for review.  Again, the United States Supreme Court gets to decide what cases it wants to hear.  If it declines to hear your appeal, your case is over.

If the United States Supreme Court accepts your appeal, your case is over once the Court issues a decision resolving your case.

This is a very simple overview of an uncomplicated appeal.  There are many legal nuances that may apply to your appeal which will affect where, when and how it is heard.

WHAT HAPPENS ON APPEAL

Unfortunately, suffering through litigation long enough to make it to the appellate process will not prepare you for what is in store.  The appellate process is nothing like the litigation process.  The case that you take up on appeal is the case that you lost (or won), below.  You cannot add new evidence, argument, claims or facts.  The appellate courts are limited to reviewing the decisions of the lower courts to determine whether those decisions are correct given the evidence, facts, argument and law before the court at the time that the lower court decided your case.

The appellate process is largely a written process.  Generally, the party who appealed (the “appellant”), will file an opening brief stating why they think the lower court screwed up.   The opposing party (in state court, the “respondent” and in federal court, the “appellee”), then gets the opportunity to file a responding brief in which they argue why the lower court was right.  The appellant can then file a brief which replies to the responding brief.   

The appellate court has discretion whether to grant oral argument on the appeal.  Oral argument is exactly what it sounds like.  Your attorney goes, stands before the Judges or Justices, and orally argues your case.  The Judges or Justices get to ask your attorney questions.  There are no witnesses.  There is no evidence.  You do not get to stand up and testify before the appellate court.  The argument is purely legal argument and the questioning by the Judges or Justices can be pretty brutal.   Adding insult to injury, your case may be determined without oral argument, if the court does not believe that argument is necessary.

The appellate court will then issue a decision on your case.

That’s the appellate process in a nutshell.  Again, most appeals are much more complicated than this.  You may have to participate in mandatory settlement conferences.  Your attorney likely will have to file procedural motions and briefs in addition to your opening, responding or reply brief.  But as a litigant preparing themselves for an appeal, you should at least expect the above process.