ATA AIRLINES, INC. v. FEDERAL EXPRESS CORPORATION, No. 1:2008cv00785 - Document 243 (S.D. Ind. 2011)
Court Description: ENTRY and ORDER granting Plaintiff's 220 Motion for Entry of Final Judgment and granting Plaintiff's 222 Motion to Alter or Amend Judgment. The court shall issue an Amended Final Judgment reflecting the above in a separate document. Signed by Judge Richard L. Young on 1/24/2011. (PG)
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ATA AIRLINES, INC. v. FEDERAL EXPRESS CORPORATION Doc. 243 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION ATA AIRLINES, INC., Plaintiff, vs. FEDERAL EXPRESS CORP., Defendant. ) ) ) ) ) ) ) 1:08-cv-0785-RLY-DML ENTRY AND ORDER ON PLAINTIFF’S MOTION TO ALTER OR AMEND JUDGMENT and PLAINTIFF’S MOTION FOR ENTRY OF FINAL JUDGMENT On October 21, 2010, following the jury trial in this breach of contract action, the court issued a document, entitled “Judgment in a Civil Action,” in favor of Plaintiff, ATA Airlines, Inc. (“ATA”). The Judgment recites that this action was tried by a jury and that the jury rendered a verdict. On its face, the document does not state the amount of damages the jury awarded ATA, and does not state the amount of pre- or post-judgment interest to be awarded ATA. ATA now moves to alter or amend the judgment in this case, and moves for the entry of a final judgment, to correct these deficiencies. The court finds that ATA’s motions should be GRANTED. A. The Jury’s Award The Supreme Court has held that “a final judgment for money must, at least, determine, or specify the means for determining the amount” to be awarded. Frontier Ins. Co. v. Hitchcock, No. 10-2044, slip op. at 4 (7th Cir. Jan. 14, 2011) (quoting United 1 Dockets.Justia.com States v. F.& N. Schaefer Brewing Co., 356 U.S. 227, 233 (1958)). The jury awarded ATA $65,998,411.00 in compensatory damages, and thus, the damages figure should have been included in the Judgment. Accordingly, this amount will be included in the Amended Final Judgment. B. Prejudgment Interest The amount of prejudgment interest in this case is the subject of dispute. As this case involves a contract analyzed under Tennessee law, the Tennessee Code governs the amount of prejudgment interest ATA is entitled to. Section 47-14-103 of the Tennessee Code reads: Except as otherwise expressly provided by this chapter or by other statutes, the maximum effective rates of interest are as follows: (1) For all transactions in which provisions of other statutes fix a maximum effective rate of interest for particular categories of creditors, lenders, or transactions, the rate so fixed; (2) For all written contracts, including obligations issued by or on behalf of the state of Tennessee, any county, municipality, or district in the state, or any agency, authority, branch, bureau, commission, corporation, department, or instrumentality thereof, signed by the party to be charged, and not subject to subdivision (1), the applicable formula rate; and (3) For all other written transactions, ten percent (10%) per annum. TENN. CODE ANN. § 47-14-103. Based upon the plain language of the statute, the court finds that this case falls under Section (2), and not under Section (3) as ATA contends. Thus, the applicable formula rate applies, and is defined as the greater of: (A) The “formula rate” in effect at such time; or (B) The “formula rate” last 2 published in the Tennessee Administrative Register prior to such time, pursuant to § 47-14-105. TENN. CODE ANN. § 47-14-102(3)(A)-(B). The formula rate is defined as: an annual rate of interest four (4) percentage points above the average prime loan rate (or the average short-term business loan rate, however denominated) for the most recent week for which such an average rate has been established by the board of governors of the Federal Reserve System, or twenty-four percent (24%) per annum, whichever is less. TENN. CODE ANN. § 47-14-102(7). The average prime loan rate, as of January 21, 2011, is 3.25%,1 meaning the maximum applicable rate is 7.25%. The court is given wide latitude in determining an appropriate prejudgment interest rate. Myint v. Allstate Ins. Co., 970 S.W.2d 920, 927 (Tenn. 1998). Given the economic climate and the low rate of interest offered by banking institutions, an award of prejudgment interest at the prime loan rate is more than sufficient to make ATA whole. Accordingly, ATA is entitled to prejudgment interest at the rate of 3.25% for the period April 3, 2008, to January 24, 2011 (or until the day before a judgment is entered). The table below sets out prejudgment interest calculations for both of the jury’s lost profits awards: 1 This number is taken from http://www.wsjprimerate.us/. See also http://www.state.tn.us/tdfi/rates/historical_listing_of_formula_rates.html. 3 Damage Award Per Diem Interest at Days in Interest Period Through 1-24- 3.25% Simple Interest 2011 Total Interest Through 1-24-2011 at 3.25% Simple Interest $21,999,470 (FY 2008) 1027 (4-3-2008 through 1-21-2011) $1,958.86 $2,011,746.05 $43,998,941 (FY 2009) 846 (10-1-2008 through 1-21-2011) $3,917.71 $3,314,385.98 TOTAL C. $5,326,132.03 Post-judgment Interest Title 28, United States Code, Section 1961 provides that “[i]nterest shall be allowed on any money judgment in a civil case recovered in a district court.” 28 U.S.C. § 1961(a). The interest “shall be calculated from the date of the entry of the judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment.” Id. The interest “shall be compounded annually . . . .” 28 U.S.C. § 1961(b). The most current federal post-judgment interest rate, for the week ending January 14, 2011, is 0.27%.2 Pursuant to 28 U.S.C. § 1961, ATA is entitled to post-judgment interest at the current federal rate on the date of judgment, compounded annually, on the total amount of the judgment. 28 U.S.C. § 1961(a). 2 This number is taken from: http://www.federalreserve.gov/releases/h15/current/. 4 D. Conclusion The court hereby GRANTS Plaintiff’s Motion to Alter or Amend Judgment (Docket # 222) and GRANTS Plaintiff’s Motion for Entry of Final Judgment (Docket # 220). The court shall issue an Amended Final Judgment reflecting the above in a separate document. SO ORDERED this 24th day of January 2011. __________________________________ RICHARD L. YOUNG, CHIEF JUDGE United States District Court RICHARD L. YOUNG, CHIEF JUDGE Southern District of Indiana United States District Court Southern District of Indiana Electronic Copies to: Peter D. Blumberg FEDERAL EXPRESS CORPORATION peter.blumberg@fedex.com Kenneth E. Broughton HAYNES AND BOONE, LLP kenneth.broughton@haynesboone.com Michael E. Gabel FEDEX LEGAL DEPARTMENT megabel@fedex.com M. Kimberly Hodges FEDEX LEGAL DEPARTMENT kim.hodges@fedex.com John David Hoover HOOVER HULL LLP jdhoover@hooverhull.com 5 Don R. Hostetler HOOVER HULL LLP dhostetler@hooverhull.com Thomas E. Kurth HAYNES AND BOONE, LLP thomas.kurth@haynesboone.com Alice McKenzie Morical HOOVER HULL LLP amorical@hooverhull.com George E. Purdy BOSE MCKINNEY & EVANS, LLP gpurdy@boselaw.com Robert R. Ross FEDERAL EXPRESS CORPORATION rrross@fedex.com W. Alan Wright HAYNES AND BOONE, LLP alan.wright@haynesboone.com 6
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