Opinion
Civil No. 99-2015 (JRT/FLN)
November 12, 2002
Paul D. Peterson, PETERSON LAW OFFICE, Woodbury, MN, for plaintiff.
Richard P. Mahoney, MAHONEY, DOUGHERTY MAHONEY, Minneapolis, MN, for defendant.
MEMORANDUM OPINION AND ORDER
Plaintiff brought this products liability action after sustaining injuries to two fingers of her left hand while operating a woodworking machine at Cannon Valley Woodwork Inc., located in Cannon Falls, Minnesota. After a two-week trial, the jury returned a verdict in plaintiff's favor and awarded her $100,138.95 in damages. Defendant has moved to alter or correct the judgment of August 9, 2002 pursuant to Rules 59(e) and 60(b)(1) and/or (6) of the Federal Rules of Civil Procedure. Defendant argues that the amount of prejudgment interest awarded by the Court was computed incorrectly, and that the correct award of prejudgment interest is $5,289.04, instead of the $6,916.52 computed by the Court. The motion was filed within ten days of the entry of judgment, as required by Rule 59(e).
In addition, plaintiff has moved to amend the findings and clarify the Court's order, requesting that prejudgment interest be computed from the date of written notice of claim, rather than the commencement of the lawsuit. Plaintiff also requests a declaratory judgment that she is entitled to post-judgment interest and costs. Plaintiff requests this relief pursuant to Rules 59(e) and/or 60(b)(1).
For the reasons discussed below, the Court grants defendant's motion to alter or correct the judgment. The Court denies plaintiff's motion to amend findings and clarify the order, and denies plaintiff's request for declaratory judgment.
BACKGROUND
Following post-trial motions by both parties, the Court entered judgment for plaintiff in the amount of $92,808.56 in an Order dated August 9, 2002. This amount reflected a reduction of two percent for the amount of fault the jury attributed to plaintiff, and a further reduction of $12,244.13, to reflect the amount of workers' compensation paid by plaintiff's employer up until the time of the verdict. The amount also included prejudgment interest of $6,916.52. In fact, the Court agreed with defendant's interpretation of the controlling Minnesota law on prejudgment interest. In the motion now pending before the Court, the defendant argues that "the [C]ourt did not take into account the offers and counteroffers by the parties, of which it did not have knowledge, so that the [C]ourt's calculation of preverdict interest is incorrect."
Plaintiff's written settlement demand was made on September 29, 1999, and was for $130,000. This action was instituted against the defendant on December 17, 1999. Defendant made a written offer of judgment for $50,000 on November 26, 2001.
Plaintiff claims that she made an oral demand for judgment for $120,000 shortly before trial. The jury returned the verdict on December 19, 2001. After making the necessary adjustments, this Court entered judgment for the plaintiff in the amount of $92,808; $6,916 represented prejudgment interest. Deducting the interest from the judgment results in a judgment of $85,892.04. Defendant correctly points out that his offer of $50,000 is closer to the award of $85,892.04, than was plaintiff's demand for judgment of $130,000. It is not, however, closer than plaintiff's oral demand of $120,000.
Plaintiff does not indicate the date on which this offer was made, but indicates that the offer was made "after November 26, 2001, but prior to commencement of trial in this matter." Plaintiff's Memorandum in Support of Motion to Amend Findings and Clarify Order and In Opposition to Defendant's Motion to Alter or Correct the Judgment at 2.
Contrary to defendant's assertion in his memorandum of law in support of the instant motion, this Court did have knowledge of the plaintiff's demand for judgment of $130,000, and of the defendant's offer of judgment of $50,000. Both were provided to this Court in the Affidavit of Paul D. Peterson as exhibits to plaintiff's memorandum of law in support of entry of judgment in favor of plaintiffs. (Peterson Affidavit at Exhibits C and D).
ANALYSIS I. Standards for Rules 59(e) and 60(b)
Both parties move under Rules 59(e) and 60(b)(1) of the Federal Rules of Civil Procedure. Rule 59(e) authorizes a motion to alter or amend a judgment after its entry; Rule 59(e) motions "shall be filed no later than 10 days after entry of the judgment." Fed.R.Civ.P. 59(e). Rule 60(b)(1) allows relief from judgment for mistakes; inadvertence; excusable neglect; newly discovered evidence; fraud; etc.; and Rule 60(b)(6) allows relief for "any other reason justifying relief from the operation of the judgment."
Defendant also moves under Rule (60(b)(6). Because Rule 60(b)(1) is applicable, Rule 60(b)(6) should not be applied. See Liljeberg v. Health Services Acquisition Corp., 486 U.S. 847, 862 (1988).
Motions regarding prejudgment interest typically are considered Rule 59(e) motions. Osterneck v. Ernst Whinney, 489 U.S. 169, 176 n. 3 (1989); McNabola v. Chicago Transit Authority, 10 F.3d 501, 520 (7th Cir. 1993); see also Capstick v. Allstate Ins. Co., 998 F.2d 810, 812-13 (10th Cir. 1993) (holding that motion for prejudgment interest should be brought under the rule allowing motion to alter or amend judgment rather than the rule providing relief from judgment.) Rule 59(e) may be granted where the movant can demonstrate that the motion is necessary to correct manifest errors of law or fact upon which the judgment is based. 11 Charles A. Wright, Arthur R. Miller, and Mary K. Kane, Federal Practice and Procedure § 2810.1 (2nd ed. 1995).
Because this motion could also be considered a motion to correct the Court's mistake in computing the prejudgment interest, the Court will also analyze the motion under Rule 60(b)(1). Rule 60(b)(1) can be used to obtain relief from judgment entered through judicial inadvertence. See Spangle v. Ming Tah Electric Co., 866 F.2d 1002, 1003 (8th Cir. 1989). Rule 60(b)(1) motions must also be brought within a "reasonable time" and defendant certainly satisfied the timeliness requirement. See Lowry v. McDonnell Douglas Corp., 211 F.3d 457, 460-61 (8th Cir. 2000) (noting that Rule 60(b) motions must be brought within thirty days from the entry of judgment to prevent use as a substitute for appeal).
II. Defendant's Motion to Alter or Amend the Judgment
Defendant correctly notes that Minnesota Statute section 549.09, subdivision 1(b) controls prejudgment interest if either party has served a written offer of settlement. Where a losing party has made an offer of settlement that is closer to the judgment than the amount of the opposing party's offer, the prevailing party receives interest only on the amount of the settlement offer, or the judgment, whichever is less, and only from the time of the commencement of the action until the time the settlement offer was made. Minn. Stat. § 549.09, subd. 1(b). Prejudgment interest may be awarded from the time the claimant serves the opposing party a written notice of claim only if the action is commenced within two years of the notice. Minn. Stat. § 549.09, subd. 1(b). An offer will not trigger the offer-counteroffer provision unless it is in writing and offers to dispose completely of the claims between the parties. Hodder v. Goodyear Tire Rubber Co., 426 N.W.2d 826, 840 (Minn. 1988).
Defendant's analysis of the Minnesota statute providing for prejudgment interest is accurate. Had the Court taken into account the defendant's offer of settlement, the correct amount of prejudgment interest would have been $5,289.04.
The amount is computed as follows:
The Federal Rules allow this Court to correct its own error where the error is the result of a "manifest error of law or fact" Fed.R.Civ.P. 59(e), or where the error is the result of "judicial inadvertence" Fed.R.Civ.P. 60(b)(1); see also Lowry v. McDonnell Douglas Corp., 211 F.3d 457, 461 (8th Cir. 2000). The Court will grant defendant's motion to alter or amend the judgment.
III. Plaintiff's Motion to Alter the Judgment
Plaintiff requests that the Court calculate prejudgment interest from the date of written notice of claim rather than commencement of the action. However, the written notice of claim was dated June 10, 1996, and the action was commenced December 17, 1999. Because the action was commenced more than two years after the written notice of claim, the interest cannot be computed from the earlier date. Minn. Stat. § 549.09, subd. 1(b). Plaintiff also argues that the Court consider its verbal offer of $120,000 made shortly before trial began. However, to be a valid offer under the statute, the offer must be written. Hodder v. Goodyear Tire Rubber Co., 426 N.W.2d 826, 840 (Minn. 1988). Plaintiff's motion to alter the judgment is therefore denied.
IV. Plaintiff's Additional Motions
Plaintiff moves for post-judgment interest and declaratory judgment that as the prevailing party, she is entitled to costs and disbursements. According to statute, these routine matters are addressed by the Clerk of Court's office. Plaintiff may file the appropriate forms for a bill of costs with the clerk's office. Plaintiff's motion is denied.
ORDER
Based upon the foregoing, the submissions of the parties, the arguments of counsel and the entire file and proceedings herein, IT IS HEREBY ORDERED that:
1. Defendant's motion to alter or correct the judgment [Docket No. 89] is GRANTED, and the Clerk shall AMEND the original judgment [Docket No. 88] to reflect the amount of $91,181.08;
2. Plaintiff's motion to amend findings and clarify order [Docket No. 91] is DENIED.
December 17, 1999 to December 31, 1999(14 days) $76.71 50,000 x 4% = $2,000.00 2,000 ÷ 365 = $5.479 (per day) 5.479 x 14 = $76.71 January 1, 2000 to December 31, 2000 (365 days) $2,500.00 50,000 x 5% = $2,500.00 January 1, 2001 to November 26, 2001 (330 days) $2,712.33 50,000 x 6% = $3,000.00 3,000 ÷ 365 = $8.219 (per day) 8.219 x 330 = $2,712.33 TOTAL: $5,289.04