Unpublished Disposition, 875 F.2d 318 (9th Cir. 1989)

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U.S. Court of Appeals for the Ninth Circuit - 875 F.2d 318 (9th Cir. 1989)

No. 87-15030.

United States Court of Appeals, Ninth Circuit.

Before FLETCHER and BEEZER, Circuit Judges, and SAMUEL P. KING* , Senior District Judge.


The settlement agreement in this class action provides for Settling Defendants to pay counsel for Class Members the total amount of $1,175,000 as attorneys' fees and costs advanced. Of this sum "$587,500.00 shall be paid within seven (7) days of the effective Date" of the agreement, and the balance "on or before May 1, 1989." There is a proviso under which the payment of "$500 per motorhome for any motorhome which is the subject of an NCC Note or a Third Party Note held by NCC or an Affiliate, which has not been paid in full by or before May 1, 1989" is deferred until the note in question is paid in full. The agreement also provides that all "awards of attorneys' fees and costs to counsel for Class Members shall be pursuant to application to the Court and Court Order."

A further clause provides: "If the Court does not award the Total Amount, the difference between the Total Amount and the amount actually awarded shall be paid by the Settling Defendants pro-rata to the Class Members ... based on the number of motorhomes owned by each Class Member."

The settlement agreement was approved by the court by Order entered on February 27, 1987. Previously, by Order entered on December 18, 1986, the court had directed that counsel file Petitions for Attorneys' Fees by December 31, 1986, and that class members file any objections thereto by January 26, 1987. A joint fee petition was filed in a timely manner seeking an award of $1,175,000. The Fee Petition covered counsel's time and expenses through November 30, 1986. This was supplemented on February 3, 1987, for time and expenses through January 31, 1987, and again on May 27, 1987, for time and expenses through April 30, 1987.

The trial court on February 9, 1987, held a hearing to consider the proposed settlement agreement and the pending Fee Petition (as supplemented through January 31, 1987). There were no written objections to the Fee Petition; however, one class member orally objected at the hearing.

The trial court analyzed the Fee Petition in accordance with the guidelines set forth in Kerr v. Screen Extras Guild, Inc., 526 F.2d 67 (9th Cir. 1975), cert. denied, 425 U.S. 951 (1976). The court's Order, entered on July 13, 1987, awarded a total of $479,208.69 to Class Counsel for fees and costs. The Order continued:

IT IS FURTHER ORDERED that counsel for class members shall file with the court on or before February 1, 1989, a final petition for award of attorneys' fees and for reimbursement of out-of-pocket expenses. In its final award, the court will consider performance of the parties with respect to carrying out the provisions of the settlement agreement including the status of all ... Notes. After the court has entered its final award of attorneys' fees and allowance of expenses, the balance, if any, remaining after deducting the awards from the sum of $1,175,000.00 will be distributed to the class members in accordance with the settlement agreement.

On August 6, 1987, Class Counsel orally moved pursuant to Fed. R. Civ. P. 59(e) for an order altering or amending that fee order. On October 23, 1987, the trial judge did amend the earlier fee order. The Amended Order provided in pertinent part:

1. No further award of fees or expenses will be made by the Court for time and out-of-pocket disbursements expended by Class Counsel in the prosecution of this litigation for the period through January 31, 1987, all of which time has been included in counsel's original petition and first supplement thereto. Specifically, it is the Court's determination that no multiplier should be applied to Class Counsel's lodestar calculation for such time, notwithstanding the Court's being aware that Class Counsel undertook this employment on a strictly contingent basis.

2. The Court's final award of fees and expenses in this matter will be based solely on time expended and disbursements advanced beginning on February 1, 1987 until the conclusion of this litigation. Class Counsel shall file a final report regarding the conclusion of the settlement of this matter, together with a final petition for fees and costs, by June 15, 1989.

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6. The Court finds that no just reason exists for delay in entering final Judgment pursuant to Rule 54(b), Federal Rules of Civil Procedure, with respect to the Court's Fee Order and Judgment regarding attorneys' fees and costs as amended hereby. Accordingly, the Clerk of the Court is hereby ordered to enter final Judgment forthwith.

The earlier Order was reaffirmed in other material respects.

The district judge's Rule 54(b) certification is to be upheld absent an abuse of discretion. Davis v. Fendler, 650 F.2d 1154, 1164 (9th Cir. 1981). On this state of the record, we hold that Rule 54(b) certification was improperly granted and that this court lacks jurisdiction over this matter at this time.

Appellants support appellate jurisdiction by stating only:

The District Court's order and judgment awarding fees and costs are final under Rule 54(b), Federal Rules of Civil Procedure, and are thus appealable under 28 U.S.C. § 1291.

It is clear, however, that Rule 54(b) does not permit piecemeal certification of parts of a claim. The rule authorizes the trial court to direct the entry of final judgment "as to one or more but fewer than all of the claims or parties" when "more than one claim for relief is presented...." This is not the same as authorizing entry of final judgment as to part of the same claim.

This court has consistently emphasized its desire to avoid piecemeal litigation. See, e.g., Continental Airlines v. Goodyear Tire & Rubber Co., 819 F.2d 1519, 1524-25 (9th Cir. 1987); McIntyre v. United States, 789 F.2d 1408, 1410 (9th Cir. 1986). As was stated in Acha v. Beame, 570 F.2d 57, 62 (2d Cir. 1978):

To be certifiable under the terms of Rule 54(b) a judgment must possess the requisite degree of finality, and must dispose of at least a single substantive claim. Thus a partial or interlocutory adjudication of a claim cannot properly be certified, even if this is attempted by means of a 'partial summary judgment' and even if the requisite 'express determination' has been made.

See generally 6 J. Moore, Moore's Federal Practice Sec. 54.30 (1988).

The total amount of the fees and costs that may be payable under the settlement agreement is fixed at the maximum sum of $1,175,000. This figure may be reduced in increments of $500 per motorhome under certain circumstances. When the final award has been made, if the total of all awards reaches the maximum under the agreement, there will be nothing to appeal regardless of the trial judge's reasoning and holdings along the way.

We hold that in this situation, appellants' claim for fees and costs advanced pursuant to the settlement agreement is one claim that cannot be certified under Rule 54(b) until the final award under the agreement has been made. Further, because the award is not final, we consider it to remain open in all respects.



The Honorable Samuel P. King, Senior United States District Judge for the District of Hawaii, sitting by designation


This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3