Unpublished Disposition, 878 F.2d 385 (9th Cir. 1987)

MEMORANDUM^** 

The sole issue on this appeal is whether this court is bound by the "law of the case" doctrine to affirm the district court's judgment on remand awarding compound interest against the United States. Appellant contends that this appeal is not governed by the panel's prior opinion because the prior opinion does not explicitly hold that an award of compound interest is appropriate in this particular case. Because we find that our prior opinion necessarily implies that the district court's compound interest award was proper, we reject appellant's contention and affirm the district court.

On June 17, 1982, the district court entered a judgment in favor of Campbell for $2,407,034.41.¹  The judgment did not include a provision for post-judgment interest. The government appealed the judgment on August 12, 1982 and the Ninth Circuit affirmed the district court. On November 28, 1983, the district court denied the government's motion to modify the judgment and granted Campbell's motion to enforce the judgment with interest as provided by law.

Although the United States paid Campbell the principal amount of the judgment, Campbell was unable to secure a payment of the interest. In August of 1985, Campbell filed suit in federal district court to recover interest under the Federal Courts Improvement Act of 1982 ("FCIA"), Pub. L. No. 97-164, Tit. III, Pt. B, Sec. 302, 96 Stat. 25, 55-56 (1982) (codified in part at 28 U.S.C. § 1961 (1982)). The district court granted partial summary judgment in favor of Campbell and held that Campbell was entitled to interest from January 13, 1983--the date Campbell filed a transcript of the Comptroller General--until November 28, 1983--the date of the denial of the government's Rule 60(b) motion. Because the judgment was entered before FCIA's effective date, however, the district court calculated the interest at the pre-FCIA rate. See 28 U.S.C. § 2411(b) (1976) (prescribing a 4% post-judgment interest rate for money judgments entered against the United States in district court). The award also provided for interest to be compounded annually "until paid."

On February 3, 1987, this court reversed the district court holding that the interest for judgments entered against the United States after FCIA's date of enactment and before the effective date, accrues at FCIA's "T-bill rate"²  during the period after the effective date and that " [i]nterest should be compounded under 28 U.S.C. § 1961(b) (1982)." Campbell, 809 F.2d at 577. The opinion noted that the government had failed to contest the propriety of the district court's award of compound interest. Id. at 567 n. 3. On remand, the district court recalculated the interest to reflect the "T-bill rate" and again awarded compound interest until payment.

In November of 1987, the government filed this notice of appeal from the district court's recalculation of the interest at the T-bill rate. On appeal, the United States contends that the district court had no authority to award compound interest until paid because the United States has only waived sovereign immunity for interest accruing between the filing of a transcript of judgment and the date of a mandate of affirmance.³  See 31 U.S.C. § 1304(b) (authorizing appropriations to satisfy awards of interest "on a judgment of a district court, only when the judgment becomes final after review on appeal or petition by the United States Government, and then only from the date of filing of the transcript of the judgment with the Comptroller General through the day before the date of the mandate of affirmance.") Because we hold that the law of the case doctrine requires affirmance of the district court's award of compound interest until paid, we need not address the government's statutory argument that compound interest, like simple interest, cannot continue to accrue against the government once a mandate of affirmance has been issued.

The law of the case doctrine precludes a district court from reconsidering on remand any issues decided explicitly or by necessary implication by the Court of Appeals. See Liberty Mutual Insurance Company v. EEOC, 691 F.2d 438, 441 (9th Cir. 1982). It is the law of the case doctrine that prevents one panel of an appellate court from reconsidering questions which another panel has decided on a prior appeal in the same case. Kimball v. Callahan, 590 F.2d 768, 771-72 (9th Cir.), cert. denied, 444 U.S. 826 (1979). Courts adhere to the doctrine in order to further "the sound policy that when an issue is once litigated and decided, that should be the end of the matter. United States v. United States Smelting Refining and Mining Co., 339 U.S. 186, 198 (1950). Issues decided by necessary implication also become the law of the case because " [i]t would be absurd that a party who has chosen not to argue a point on a first appeal should stand better as regards the law of the case than one who had argued and lost." Fogel v. Chestnutt, 668 F.2d 100, 109 (2nd Cir. 1981), cert. denied, 459 U.S. 828 (1982). Although the law of the case doctrine is not an "inexorable command," prior legal decisions must be followed "unless there is substantially different evidence at a subsequent trial, new controlling authority, or the prior decision was clearly erroneous and would result in injustice." Handi Investment Co. v. Mobil Oil Corp., 653 F.2d 391, 392 (9th Cir. 1981).

The disposition of this appeal is governed by the law of the case. Appellee Duncan Campbell, called the district court's award of compound interest into question in his prior appeal. See Campbell, 809 F.2d at 567 ("On appeal, Campbell argues that the district court should have applied the T-bill rate under the FCIA and that the interest should have been compounded at that rate.") The government, however, declined to appeal the district court's award of compound interest. Id. at n. 3 ("The government notes in its appellate brief that it does not concede--but has not appealed--the issue [ ] whether the interest should have been compounded under former 28 U.S.C. § 2411(b)....") Because the government declined to appeal from the compound interest award, the panel remanded the case to the district court for a recalculation of both simple interest and compound interest at the T-bill rate. Id. at 577 ("We hold that, for judgments entered against the United States after the FCIA's date of enactment and before the effective date, the FCIA governs the post-judgment interest rate during the period after the effective date. Interest should be compounded under 28 U.S.C. § 1961(b) (1982). Accordingly, we reverse the decision of the lower court applying the former 4% rate and remand for determination of the appropriate T-bill rate that should be applied to Campbell's judgment.") Thus, by necessary implication, the panel endorsed both the general proposition that interest should be compounded in cases governed by the FCIA and the specific proposition that compound interest should be awarded in this case. The government may not capitalize on its own failure to raise relevant arguments in the prior appeal, in order to escape the application of the law of the case doctrine. See Fogel, 668 F.2d at 109 (commenting on the absurdity of allowing a party who has chosen not to argue a point to stand in a better position than a party who argued the point and lost).

This is not a case where substantially different evidence was introduced at a subsequent trial, new controlling authority governs the outcome, or where the prior decision was clearly erroneous and would result in injustice. See Handi Investment Co., 653 F.2d at 392. The government's argument that an award of compound interest until paid impermissibly infringes on its sovereign immunity is not based on new findings made by the district court on remand. Rather, the sovereign immunity argument was equally available to the government at the time of our prior appeal. After opting to allow the district court's award of compound interest to stand, the government may not raise this argument in a subsequent appeal. Accordingly, our prior opinion implicitly approving of the district court's award of compounded interest until paid is the law of the case and the district court must be AFFIRMED.⁴ 

AFFIRMED.