[00:00:00] Speaker 00:
Last case of the day, place of origin of the day.

[00:00:07] Speaker 00:
Number 22-1421, Murphy versus Schabel.

[00:00:43] Speaker 00:
You may proceed.

[00:00:51] Speaker 04:
Good morning, and may it please the court.

[00:00:53] Speaker 04:
My name is Kendra Beckwith, and I'm here today on behalf of the appellant, Thomas Scheibel.

[00:00:58] Speaker 04:
This case begins with the very simple and undisputed fact that plaintiff and husband were joint tenants on the SSN account, which meant that each possessed the entire account, not a fractional share therein,

[00:01:13] Speaker 04:
So the question before you today is whether my client, who was the investment advisor to the SSN account, harmed plaintiff when consistent with his contracts managed by the account, he moved money at the direction of the husband.

[00:01:31] Speaker 03:
This is JMOL.

[00:01:33] Speaker 03:
So we have a jury verdict that has found a breach of fiduciary duty.

[00:01:39] Speaker 03:
That's correct, Your Honor.

[00:01:40] Speaker 03:
So you've got a pretty steep climb here when we have jury factual findings.

[00:01:47] Speaker 03:
And it seems to me that your client had fiduciary obligations to both spouses and ignored all of the communications from the wife while quickly responding to the communications from the husband.

[00:02:04] Speaker 03:
Couldn't the jury find that that was a breach of fiduciary duty?

[00:02:08] Speaker 03:
that ended up harming the wife because the entire proceeds of the account were put out of her reach.

[00:02:16] Speaker 04:
So there's two questions there, and I'm going to address each in turn.

[00:02:21] Speaker 04:
As to whether the jury could have found a breach of fiduciary duty, the duty that was owed here was always defined by the contract to both the husband and the plaintiff.

[00:02:32] Speaker 04:
And so as a matter of law, he could not place one over the other.

[00:02:37] Speaker 04:
But he did.

[00:02:38] Speaker 03:
And the jury could find he did because as wife says, give me advice, can we split these equally?

[00:02:46] Speaker 03:
No response.

[00:02:48] Speaker 03:
Husband says, quickly shift all the money into my account in bail so I can send it to Mexico where she won't have any ability to access it.

[00:02:58] Speaker 03:
And bam, it's gone.

[00:03:00] Speaker 03:
As a matter of fact, the money was not actually shifted to his account in Vail.

[00:03:04] Speaker 03:
It was a joint account in Vail that she didn't know it had been moved.

[00:03:10] Speaker 03:
In fact, he waited until she said, oh, I'm driving to Colorado.

[00:03:14] Speaker 03:
And then they did it.

[00:03:15] Speaker 03:
And husband immediately shifted the money into a Mexico account, which she had no access.

[00:03:21] Speaker 04:
Respectfully, though, I think that's the distinction that matters here, is that

[00:03:26] Speaker 04:
Even if we assume, I won't concede, but we assume a breach of fiduciary duty, the harm is not, there is no harm to her by the actions that my client took.

[00:03:37] Speaker 04:
Because my client acting consistent with the client services agreement.

[00:03:41] Speaker 03:
I believe there's an email where the brother says to the financial advisor, the husband says, and I'm gonna move it then once you send it to me to my account in Mexico.

[00:03:51] Speaker 03:
So it's certainly foreseeable what's gonna happen.

[00:03:57] Speaker 04:
But the act itself, foreseeable or not, is to move money from a joint account to a joint account, which she authorized him to do.

[00:04:10] Speaker 00:
And the money he... You're totally ignoring the fiduciary duty.

[00:04:14] Speaker 00:
All the contract does is allow the defendant to move assets or money at the direction of one of the

[00:04:25] Speaker 00:
joint tenants.

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It doesn't say you have to.

[00:04:29] Speaker 00:
At the same time, there's a fiduciary duty to treat all the beneficiaries of the fiduciary duty equally.

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And that was not done here.

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And it's not just the transfer of the funds.

[00:04:47] Speaker 00:
It's the, maybe even more importantly, it's the denial of information.

[00:04:52] Speaker 00:
She, after this happened,

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She apparently had the authority to change the arrangement so that she had to approve any transfer of funds.

[00:05:02] Speaker 00:
Am I correct about that?

[00:05:03] Speaker 00:
Am I reading that correctly?

[00:05:06] Speaker 00:
She changed it so that no longer could funds be moved without her consent.

[00:05:11] Speaker 00:
Correct.

[00:05:11] Speaker 00:
Post-fee.

[00:05:12] Speaker 00:
Yeah.

[00:05:12] Speaker 04:
Yeah.

[00:05:13] Speaker 00:
Well, what do you think she would have done if she knew what your client knew was going to happen with this money?

[00:05:23] Speaker 00:
have changed the rules, so it couldn't be done without her consent.

[00:05:27] Speaker 00:
But you've got an incredible burden, at least with me, to show that your client treated the two joint tenants fairly, that they were treated similarly.

[00:05:44] Speaker 00:
That's in Colorado law.

[00:05:46] Speaker 00:
What's the language in the case that they must be?

[00:05:54] Speaker 00:
There's a duty to deal impartially with the beneficiaries.

[00:06:02] Speaker 04:
With beneficiaries.

[00:06:03] Speaker 04:
And if it's the Payne-Weber case, the Payne-Weber case deals with a duty to deal with... This is the Stephanop.

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And it's just taken from restatement of torts.

[00:06:16] Speaker 00:
Or agency, I'm sorry.

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I don't remember which restatement it is.

[00:06:19] Speaker 04:
I believe it's from torts.

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Regardless, here they were viewed as a joint client, and that's what they agreed to in the SSM agreement.

[00:06:28] Speaker 03:
But he didn't treat them equally.

[00:06:30] Speaker 03:
Every time the husband said anything, he responded and ignored the wife.

[00:06:35] Speaker 03:
He shared all the wife's communications with the husband and kept completely silent when the husband says,

[00:06:42] Speaker 03:
send it to me so I can transfer it to my account in Mexico.

[00:06:48] Speaker 04:
I believe the email says to us in Mexico.

[00:06:51] Speaker 03:
He says to Vale, and he says so I can transfer it back home here to Mexico.

[00:06:59] Speaker 03:
There's no suggestion that it's so I can share it with her.

[00:07:04] Speaker 03:
I mean, I honestly, I'm as tough a sell as my colleague here.

[00:07:13] Speaker 04:
And I think what I want to impart to this court is that even if we find, as we affirm the jury's breach of fiduciary duty finding, at the end of the day, a joint tenant account is exclusive control over all of the funds.

[00:07:31] Speaker 04:
So Michael, or the husband here, had the right to move those funds regardless.

[00:07:37] Speaker 00:
But couldn't have done it without the assistance of your client.

[00:07:41] Speaker 00:
and couldn't have done it without your clients breaching your client's fiduciary duty to the plaintiff.

[00:07:50] Speaker 04:
That's... The duty is joint in the sense that they authorized him to act on the instruction of either account holder.

[00:08:02] Speaker 01:
But what's your authority for your statement that the fiduciary duty was limited solely to what was contained within that joint account agreement?

[00:08:09] Speaker 01:
Because what Judge Hartz is asking

[00:08:11] Speaker 01:
is under Colorado law, the fiduciary duties is much broader than that.

[00:08:15] Speaker 01:
So you made that statement to say, well, it's only contained within the contract.

[00:08:19] Speaker 01:
What's your authority for that?

[00:08:21] Speaker 04:
The fiduciary duty here, there's not an otherwise common law fiduciary duty because it is the contract here that defines that duty.

[00:08:30] Speaker 00:
Well, if the contract said that your client had to comply,

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word may.

[00:08:47] Speaker 04:
It does.

[00:08:48] Speaker 04:
But I also don't think that there was ever a request from her.

[00:08:52] Speaker 04:
There was a request for information, but there was not a request to transfer the funds.

[00:08:55] Speaker 03:
Well, there was a request.

[00:08:57] Speaker 03:
She said, what can I do?

[00:08:58] Speaker 03:
Can we split these accounts 50-50?

[00:09:02] Speaker 03:
She expressed to her financial advisor, I don't really know.

[00:09:06] Speaker 03:
She made it very clear, I want to be fair.

[00:09:09] Speaker 03:
I want to split everything 50-50.

[00:09:12] Speaker 03:
And instead of responding to her request, he forwards her emails to the husband and then facilitates the husband taking 100% of the account.

[00:09:23] Speaker 03:
I mean, I see causation in terms of damages, and I see a clear breach of fiduciary duty.

[00:09:33] Speaker 04:
Turning then with the remaining time I have, I want to briefly discuss the prejudgment interest issue.

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Because here, even if this court affirms the jury's

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verdict, the judgment.

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The award of prejudgment interest should be reversed, because the request for that prejudgment interest was never timely made.

[00:09:51] Speaker 03:
What federal rule of civil procedure addresses expressly prejudgment interest?

[00:09:58] Speaker 03:
There is not one.

[00:09:59] Speaker 03:
So it's pretty vague.

[00:10:02] Speaker 04:
I don't believe it's vague, Your Honor, because what we do know is that the motion that was made here, pre-entry of judgment, was made pursuant

[00:10:12] Speaker 04:
not to a specific rule, but sought relief consistent with rule 58.

[00:10:17] Speaker 04:
And in fact, the only case that is cited in that motion relies on 58 to request the prejudgment interest.

[00:10:25] Speaker 04:
What that motion asked for was entry of judgment with interest.

[00:10:31] Speaker 04:
What happened on day 150, and there was no separate document, is that that motion was in part granted final judgment entered, but then

[00:10:41] Speaker 04:
It's denied in part because there was no prejudgment interest awarded.

[00:10:45] Speaker 01:
Prejudgment interest is a component of the actual damages in the case, so you agree with that, right?

[00:10:52] Speaker 04:
It is a component of damages, yes, but it still has to be properly... And it had not yet been decided by the district court.

[00:10:58] Speaker 01:
Correct.

[00:10:59] Speaker 01:
And in fact, I believe your client contested the prejudgment interest amounts necessitating the district court then to have to go through and make additional findings and analysis, right?

[00:11:09] Speaker 04:
Correct.

[00:11:10] Speaker 04:
But the need to make additional findings doesn't mean that it would have survived the constructive entry of judgment.

[00:11:18] Speaker 04:
Because if that's the case, then the 150-day rule becomes meaningless because it never actually effectively prevents the cases from languishing.

[00:11:29] Speaker 00:
OK.

[00:11:29] Speaker 00:
You're conflating two things about a final judgment.

[00:11:33] Speaker 00:
There's a substantive component and a procedural timeliness component.

[00:11:38] Speaker 00:
Correct.

[00:11:40] Speaker 00:
You don't have a final judgment unless all the claims have been disposed of.

[00:11:44] Speaker 00:
Maybe you heard us discussing that earlier.

[00:11:47] Speaker 00:
Exactly.

[00:11:48] Speaker 00:
In this case, there was a motion to award interest, prejudgment interest.

[00:11:55] Speaker 00:
That was never disposed of.

[00:11:57] Speaker 00:
There was never substantively a final judgment.

[00:12:00] Speaker 00:
What you're referring to, the 150-day rule, can't change whether there's substantively a final judgment.

[00:12:06] Speaker 00:
It just determines when everyone knows that the time to file post-judgment motions or the time to appeal, those things occur.

[00:12:15] Speaker 00:
But that you cannot, the 150-day rule, the separate document rule, cannot convert a substantively non-final judgment into a final judgment.

[00:12:26] Speaker 00:
And that's what your argument is.

[00:12:31] Speaker 00:
The 150 days elapsed.

[00:12:33] Speaker 00:
So as a result, there's a final judgment, and the request for prejudgment interest has been denied.

[00:12:41] Speaker 00:
But no.

[00:12:42] Speaker 04:
Respectfully, Your Honor, I think it's more nuanced than that.

[00:12:44] Speaker 04:
And the briefs make it more nuanced than that.

[00:12:47] Speaker 04:
I'm aware of the analytical difference between a 28-USD-1291 finality and what Rule 58 says.

[00:12:54] Speaker 04:
The judgment here, the jury verdict on the docket, was final.

[00:12:59] Speaker 00:
Yes.

[00:12:59] Speaker 04:
That is a subsistently final judgment.

[00:13:02] Speaker 04:
Yes.

[00:13:02] Speaker 04:
direct the court to the Garcia case.

[00:13:05] Speaker 00:
That's true.

[00:13:06] Speaker 00:
It was a final judgment because there was nothing pending.

[00:13:08] Speaker 00:
There's been no request for prejudgment interest at that time.

[00:13:12] Speaker 00:
But then there was a motion filed after that by the plaintiff seeking prejudgment interest.

[00:13:21] Speaker 00:
And that, oh shoot, I always forget the right word.

[00:13:25] Speaker 00:
But the finality was suspended.

[00:13:28] Speaker 00:
What's the word?

[00:13:30] Speaker 00:
So it was no longer final.

[00:13:33] Speaker 00:
As soon as that timely motion after the judgment was filed, there was no longer final judgment.

[00:13:41] Speaker 00:
And it wouldn't be final until interest had been disposed of.

[00:13:46] Speaker 04:
If it were a proper Rule 59 motion, yes.

[00:13:50] Speaker 03:
Don't we have the discretion to treat it as the 59 motion?

[00:13:54] Speaker 03:
We have a million cases that say you can

[00:13:56] Speaker 03:
You can call your motion anything you want, but we are going to treat it as what it is.

[00:14:02] Speaker 04:
Those cases, none of them have ever been used to convert a motion with prejudgment interest.

[00:14:08] Speaker 04:
They've all been motions to reconsider the merits of a claim.

[00:14:12] Speaker 04:
More importantly, you would have to really dig deep to look at that motion and say that it was a motion to reconsider or motion appropriate for a Rule 59 characterization.

[00:14:25] Speaker 04:
All that it asked for was entry of judgment with prejudgment interest and cited to a case referring to Rule 58.

[00:14:33] Speaker 00:
Substantively, I don't see the difference.

[00:14:37] Speaker 00:
I think it's being awfully technical.

[00:14:38] Speaker 00:
In this area, we're very non-technical.

[00:14:42] Speaker 00:
The caption, we look at the substance of what's being requested.

[00:14:46] Speaker 00:
And here, the plaintiff said, OK, I won.

[00:14:49] Speaker 00:
We didn't really discuss interest.

[00:14:53] Speaker 00:
Maybe through oversight.

[00:14:54] Speaker 00:
Maybe plaintiffs should have argued it before.

[00:14:58] Speaker 00:
But I'm going to request that you consider prejudgment of interest and enter in judgment or an amended judgment with prejudgment interest.

[00:15:10] Speaker 00:
And I don't see how we cannot construe it that way.

[00:15:16] Speaker 04:
Because in the situation where you have constructive entry of judgment, if

[00:15:22] Speaker 04:
The way that it was drafted, if we construe it to be anything similar to Rule 59, then the finality that the 150-day rule is intended to impart becomes meaningless because now we don't know when the final judgment occurs.

[00:15:40] Speaker 00:
And then cases will continue to languish.

[00:15:42] Speaker 00:
It will languish until the judge disposes of all the claims.

[00:15:47] Speaker 00:
That's always the case.

[00:15:48] Speaker 00:
It's going to languish until the case is disposed of.

[00:15:51] Speaker 00:
Then you have a substantively final judgment.

[00:15:53] Speaker 00:
You don't let that languish anymore.

[00:15:56] Speaker 00:
The separate document rule requires entry of a separate document.

[00:16:03] Speaker 00:
And if the judge neglects or for some reason it's not done, the 150-day rule says, OK,

[00:16:09] Speaker 00:
Now you're fine.

[00:16:10] Speaker 00:
Now you know you have, this is a set date.

[00:16:15] Speaker 00:
If you're gonna file a post-judgment motion or you're gonna appeal, this is the start date for that.

[00:16:19] Speaker 00:
It has nothing to do with making, clarifying when the end is because you've disposed of all the claims.

[00:16:29] Speaker 00:
That 150-day rule has nothing to do with the substantive finality of the judgment.

[00:16:38] Speaker 04:
May I respond?

[00:16:40] Speaker 00:
Of course, yes.

[00:16:41] Speaker 00:
I want to be educated if you can show me where I'm missing.

[00:16:45] Speaker 04:
I understand the distinction between the substantive finality and the Rule 58 finality.

[00:16:51] Speaker 04:
The best case I can offer this court is the Garcia case, where Garcia versus Burlington Northern, where there was an entitlement to prejudgment interest.

[00:17:00] Speaker 04:
There was a request for prejudgment interest.

[00:17:03] Speaker 04:
Final judgment entered.

[00:17:04] Speaker 04:
Nobody asked for anything.

[00:17:08] Speaker 04:
Judgment entered.

[00:17:11] Speaker 00:
Was that the decision of this court?

[00:17:13] Speaker 04:
It is.

[00:17:13] Speaker 04:
I believe it's a 2000.

[00:17:16] Speaker 00:
Was it by Judge McKay?

[00:17:18] Speaker 00:
I can't remember the name of it.

[00:17:19] Speaker 04:
I believe that is correct.

[00:17:21] Speaker 00:
It's 818, Federal 2nd, 713.

[00:17:23] Speaker 00:
That's a great case for you.

[00:17:25] Speaker 00:
It's exactly such a circumstance.

[00:17:27] Speaker 00:
But it's what we call a drive-by jurisdictional ruling.

[00:17:30] Speaker 00:
You won't find one word in that where they discussed whether that really was a final judgment or not.

[00:17:36] Speaker 00:
It was not a final judgment.

[00:17:38] Speaker 00:
I think what they say was the plaintiff treated this as a final judgment and followed the notice of appeal.

[00:17:45] Speaker 00:
There's no substantive ruling.

[00:17:48] Speaker 00:
There was not a final judgment in that case.

[00:17:51] Speaker 00:
But it's a great case for you.

[00:17:52] Speaker 00:
It just doesn't stand for that point because it was never discussed and it was wrong.

[00:17:58] Speaker 04:
But the point that I think it does make is that if something enters after you have requested

[00:18:07] Speaker 04:
Prejudgment interest.

[00:18:10] Speaker 04:
So here, what was requested in that motion for prejudgment interest was entry of judgment with prejudgment interest.

[00:18:18] Speaker 04:
Constructively, judgment entered.

[00:18:21] Speaker 04:
Part of that relief was granted.

[00:18:24] Speaker 04:
What needed to be renewed was the request for prejudgment interest.

[00:18:30] Speaker 04:
Because by operation of law, the motion was disposed of.

[00:18:36] Speaker 00:
It wasn't.

[00:18:37] Speaker 00:
You won't find any case, any correct case, that says a motion is disposed of by the 150-day rule.

[00:18:46] Speaker 00:
It cannot affect the substantive finality of the judgment.

[00:18:51] Speaker 00:
I mean, a very interesting brief you wrote.

[00:18:57] Speaker 00:
But it starts from a premise which just isn't the law.

[00:19:04] Speaker 04:
If this court has no further questions, I would ask that the judgment be reversed, remanded in my client's favor, or alternatively, the prejudgment interest award be vacated.

[00:19:15] Speaker 00:
Thank you.

[00:19:26] Speaker 02:
May it please the court.

[00:19:27] Speaker 02:
My name is Anthony Goles.

[00:19:28] Speaker 02:
I represent the plaintiff appellee, Ms.

[00:19:30] Speaker 02:
Murphy.

[00:19:31] Speaker 02:
We would ask the court to affirm the judgment in this case.

[00:19:34] Speaker 02:
When I say the judgment, I mean the real judgment, the two-page final judgment set forth on a separate document in compliance with Rule 58 on June the 28th of 2023.

[00:19:44] Speaker 02:
Now, there are three points I'd like to address on the finality issue.

[00:19:50] Speaker 02:
There are three key reasons why none of the instruments that the defendant relies on can be a final judgment in this case.

[00:19:57] Speaker 02:
For the first point,

[00:19:59] Speaker 02:
There's an opinion I came across that's not cited in our brief.

[00:20:01] Speaker 02:
It's cited in the Rule 58 Advisory Committee Notes.

[00:20:04] Speaker 02:
It's the Supreme Court's opinion and the Schaeffer Brewing Company's opinion.

[00:20:09] Speaker 02:
The citation is 356 U.S.

[00:20:11] Speaker 02:
227.

[00:20:13] Speaker 02:
Now, with that opinion, excuse me.

[00:20:17] Speaker 03:
What year?

[00:20:18] Speaker 02:
1958.

[00:20:20] Speaker 02:
Thank you.

[00:20:21] Speaker 02:
That opinion involved trying to determine whether something that was not a final judgment nonetheless qualified as

[00:20:28] Speaker 02:
And what the Supreme Court looked at in that case was two factors.

[00:20:32] Speaker 02:
Number one, does it embody the essential elements of a judgment?

[00:20:36] Speaker 02:
And number two, does it clearly evidence the district court's intention that that will be the district court's final act in the case?

[00:20:43] Speaker 02:
Now, we raised these points in our brief that the verdict itself cannot be a final judgment because it did not address the pending request for prejudgment interest.

[00:20:54] Speaker 02:
And there's a good reason why it could not and did not address that.

[00:20:58] Speaker 02:
You don't ever submit pre-judgment interest issues to the jury, because this court and Colorado state courts have recognized that bound up within the term determination of pre-judgment interest rewards are purely legal issues, questions of law for the court.

[00:21:13] Speaker ?:
And in this case, they can't even say that the verdict implicitly addressed the entitlement to pre-judgment interest.

[00:21:20] Speaker 02:
They might have been able to, because again, it's our contention that pre-judgment interest in this case was mandatory.

[00:21:26] Speaker 02:
But Judge, as you pointed out, they disputed two key legal issues in this case, right?

[00:21:30] Speaker 02:
Number one, they disputed the approval date.

[00:21:33] Speaker 02:
That had to be determined by the district court.

[00:21:35] Speaker 02:
So his calculation wasn't purely ministerial.

[00:21:38] Speaker 02:
Number two, they contested the compounding of interest.

[00:21:41] Speaker 02:
They said it should not compound on pre-filing interest.

[00:21:44] Speaker 02:
Now, because of that, those issues remained outstanding for the court to determine until June 28th, 2023, when he finally entered his order ruling on post-trial

[00:21:55] Speaker 02:
Now, the problem, most of what you said makes sense.

[00:21:59] Speaker 00:
But verdict ordinarily, when it's entered, is a final judgment, as long as it's addressed the issues that have been presented.

[00:22:10] Speaker 00:
No one had argued.

[00:22:11] Speaker 00:
Was there a pleading requesting pre-request?

[00:22:14] Speaker 00:
The pleading requested it.

[00:22:15] Speaker 02:
Yes, Your Honor.

[00:22:16] Speaker 02:
It was properly applied.

[00:22:17] Speaker 02:
And the district court's pre-trial order also mentioned that we still had a pending request.

[00:22:21] Speaker 02:
I don't want to call it a claim, but to an extent, we can call it a claim or a request.

[00:22:25] Speaker 02:
It was plain.

[00:22:26] Speaker 00:
So even without the motion.

[00:22:28] Speaker 00:
So if someone had appealed the verdict, we would have to send it back down saying not all the issues raised here have been resolved.

[00:22:41] Speaker 02:
Yes, sir.

[00:22:42] Speaker 02:
Even without the motion.

[00:22:43] Speaker 02:
But certainly the motion was the icing on the cake, right?

[00:22:45] Speaker 02:
Two weeks later.

[00:22:46] Speaker 02:
And I'm sorry, but this is such a gotcha argument if I've ever heard one.

[00:22:50] Speaker 02:
that we were required to renew a motion that we filed less than two weeks after the jury returned its verdict.

[00:22:56] Speaker 02:
And we didn't act prudently because we didn't know we didn't have to renew it.

[00:23:00] Speaker 02:
I mean, we prudently and timely raised the issue of pre-judgment interest, not only in our pleadings, but with the post-trial motion.

[00:23:08] Speaker 02:
So it bothers me that that argument is being made.

[00:23:12] Speaker 02:
It's one thing if an appellant is saying, hey, court, we're just trying to be prudent here.

[00:23:18] Speaker 02:
We don't want to blow our appellate deadlines.

[00:23:20] Speaker 02:
We don't really think a final judgment is entered, but we can't say for sure.

[00:23:24] Speaker 02:
And we can't confer jurisdiction on the appellate court by agreement.

[00:23:28] Speaker 02:
But it's another thing to then turn that into a sword and say that the prevailing party of trial can't even request or can't even obtain prejudgment of interest because they didn't renew their motion that had never been ruled on.

[00:23:40] Speaker 02:
And we raise this in our brief as well.

[00:23:43] Speaker 02:
No reasonable lawyer is going to look at a docket and construe a verdict as a judgment such that he's going to have to take some sort of post

[00:23:50] Speaker 02:
judgment actions within the contemplation of the rules.

[00:23:54] Speaker 00:
Why do you say that?

[00:23:56] Speaker 00:
Ordinarily, wouldn't the verdict, once it's entered, and the rules provide for the, I think it requires the clerk to enter judgment based on the verdict, why in the ordinary course of things wouldn't you take that entry by the clerk?

[00:24:16] Speaker 00:
Maybe you should fill me in on practice.

[00:24:19] Speaker 00:
What usually happens on a jury verdict in the federal district courts here?

[00:24:23] Speaker 00:
Because I'm not familiar with the practice.

[00:24:25] Speaker 00:
Is a separate document entered after the verdict?

[00:24:30] Speaker 00:
It's supposed to be, and I believe so.

[00:24:32] Speaker 02:
I would hope that happens in the vast majority of cases, although reading some older tense circuit opinions apparently was a frequent occurrence that

[00:24:40] Speaker 02:
that would have a memorandum or a decision but not a separate document final judgment.

[00:24:47] Speaker 00:
I'm talking about a jury verdict.

[00:24:48] Speaker 00:
Yes.

[00:24:49] Speaker 00:
Because the rules specifically provide for the court to enter judgment unless the district court says otherwise.

[00:24:57] Speaker 00:
So that's why I would have thought that what was done here when the, well it's a little ambiguity in what the court clerk entered on the docket.

[00:25:08] Speaker 00:
I would have thought that once the clerk does that after a jury verdict, that satisfies on its face the requirements for a final judgment.

[00:25:18] Speaker 00:
The reason it wouldn't have been a final judgment in this particular case is because the verdict didn't dispose of all the claim.

[00:25:26] Speaker 02:
That's right.

[00:25:27] Speaker 02:
But what I would point to is just the lack of decretal language, right?

[00:25:31] Speaker 02:
Typically, when you see a decision by a court, it's an act of the court, right?

[00:25:35] Speaker 02:
We look at the verdict form, it's merely an act of the jury.

[00:25:38] Speaker 00:
We, the jury, find this false.

[00:25:40] Speaker 00:
So ordinarily, after a jury verdict in a civil case, there's a document with decretal language in it that is filed?

[00:25:51] Speaker 00:
Yes, Your Honor.

[00:25:52] Speaker 00:
I would hope so, and I believe so.

[00:25:54] Speaker 00:
Yes, Your Honor.

[00:25:54] Speaker 00:
You've seen those.

[00:25:55] Speaker 02:
Yes.

[00:25:56] Speaker 00:
Well, I mean, in this case, there's some rules.

[00:25:59] Speaker 00:
I'm sorry.

[00:26:00] Speaker 02:
This case presents an example where if you have a two document or two page final judgment renders following the jury, not immediately after once all of the outstanding issues were disposed of.

[00:26:12] Speaker 00:
OK, you're talking about well after the 150 days and all.

[00:26:15] Speaker 00:
But actually, OK.

[00:26:18] Speaker 02:
Well, and certainly even in

[00:26:22] Speaker 02:
Even if you have a docket entry and the docket entry simply set judgment on verdict, that at least conveys some sort of intention by either the court or the clerk to render judgment.

[00:26:32] Speaker 02:
That would.

[00:26:32] Speaker 00:
I'm just wondering what happens.

[00:26:34] Speaker 00:
It's not clear to me reading the rules what should happen.

[00:26:38] Speaker 02:
It is my understanding that following a jury verdict, and certainly what Rule 58 contemplates is that the clerk or the court

[00:26:46] Speaker 02:
depending on whether it's a general or a special verdict is supposed to initiate the action with regards to the entry of the separate document final judgment.

[00:26:54] Speaker 02:
Now, the basis for their constructive entry of judgment argument in this case is simply passage of time.

[00:27:01] Speaker 02:
And this case has rejected that argument in Utah versus Northern, it's cited in our briefing, where as you pointed out before, the 150-day rule cannot be used to transform something which is not otherwise a final decision into one.

[00:27:15] Speaker 02:
And if we look at the verdict, if we look at the court in minutes, there's no evidence of an intention by the courts to render judgment even on the verdict itself.

[00:27:25] Speaker 02:
All he did was he read the verdict once it was returned.

[00:27:29] Speaker 02:
And far from evidencing and intent that that would be the final act in the entire case, maybe that the trial itself is certainly not the overall case.

[00:27:38] Speaker 03:
Well, if there hadn't been a motion for pre-judgment interest,

[00:27:45] Speaker 03:
then with 150 days have transformed the jury verdict into a final judgment passage.

[00:27:52] Speaker 02:
So it's pled in the pleading but not asked for by motion?

[00:27:55] Speaker 03:
Yeah.

[00:27:56] Speaker 02:
I think no.

[00:27:57] Speaker 03:
I would answer no.

[00:27:58] Speaker 03:
So you forever wait for the successful party to file a motion?

[00:28:05] Speaker 03:
I mean, that seems

[00:28:07] Speaker 02:
I mean, hypothetically, yes, but that's not what happened here because we... Well, I'm not asking.

[00:28:11] Speaker 03:
I'm trying to figure out how the rules work.

[00:28:13] Speaker 03:
You have a rule that says after 150 days, it's deemed to be a judgment entered.

[00:28:21] Speaker 03:
And you have a prevailing party who never got around to making a motion for interest.

[00:28:29] Speaker 03:
I mean, wouldn't that 150 days in that instance, there's nothing pending.

[00:28:34] Speaker 03:
You've got finality, substantively.

[00:28:37] Speaker 02:
I think the principle that might apply in that instance, Your Honor, is something like lashes that you've waited so long to request the release that you've maybe implicitly awaited.

[00:28:45] Speaker 00:
But I don't know that automatically the 150-day rule would start upon the... Well, you still would never substantively final judgment when there is a claim that was pleaded and has not been resolved.

[00:28:58] Speaker 00:
That's right.

[00:29:00] Speaker 00:
So what would happen is you'd wait around, or opposing party would wait around forever before filing a notice of appeal.

[00:29:11] Speaker 00:
That's unlikely.

[00:29:13] Speaker 00:
And then when the notice of appeal is filed, then the issue of whether there's a final judgment or not gets considered.

[00:29:20] Speaker 00:
And this court might well, the clerk's office might look through this and say, hmm, you haven't resolved this, dismissed.

[00:29:28] Speaker 02:
You know, and that's what's interesting about prejudgment interest, right?

[00:29:31] Speaker 02:
If this were a claim that's not submitted to the jury, it's deemed waived, right?

[00:29:36] Speaker 02:
But prejudgment interest isn't submitted to the jury because it's a purely legal issue, so it's kind of its own little animal.

[00:29:43] Speaker 02:
I want to say that I came across in some of the cases that were cited in the briefing, and I don't have them with the tips of my fingers right now, but

[00:29:51] Speaker 02:
I want to say in one of the cases that was the principle that the court had relied on for denying prejudgment interest to say that you simply waited too long to ask for it.

[00:29:59] Speaker 01:
Do I have it right though that here it was the prejudgment interest was still to be calculated, to be decided, but also that the defendant filed a motion for 50B that the district court then had to dispose of?

[00:30:11] Speaker 01:
That's correct.

[00:30:12] Speaker 01:
And that was filed at what point in time in relation to the 150 day clock, do you recall?

[00:30:18] Speaker 02:
It's my understanding that they filed it when they contended that the 150-day time period had run, and that when they filed their initial notice of appeal, they also filed a rule of 50-B motion.

[00:30:28] Speaker 02:
I think they dropped a footnote in it about the 150-day rule.

[00:30:33] Speaker 02:
So turning to the state law claim on breach of fiduciary duty, there are two admissions made by the defendant that are fatal to his arguments.

[00:30:42] Speaker 02:
on the 50B motion.

[00:30:43] Speaker 02:
The first is that they admit that the plaintiff had an ownership right to all $2.5 million of the funds that were transferred, right, uncontested.

[00:30:51] Speaker 02:
They merely focus on this point on, well, you know, Michael had the ability as a joint tenant and under this agreement to unilaterally request a transfer.

[00:30:59] Speaker 02:
And again, that completely ignores everything that preceded it.

[00:31:02] Speaker 02:
I mean, Judge McHugh, you pointed out yourself, March 22nd, she asked for half.

[00:31:06] Speaker 02:
I don't know how that request could have been more clear.

[00:31:09] Speaker 03:
Well, it could have been more clear.

[00:31:12] Speaker 02:
But we don't have a swearing match, right?

[00:31:15] Speaker ?:
She said what she said in the email.

[00:31:17] Speaker 02:
And the point was, yes, she had the right to ask for the distribution.

[00:31:20] Speaker 02:
She should have answered the question.

[00:31:24] Speaker 02:
And the important thing to remember in this case is that his admitted fiduciary duties to the plaintiff are not lessened merely because he's dealing with a family member.

[00:31:34] Speaker 02:
And his train of thought seems to be, well, it's just my sister-in-law.

[00:31:38] Speaker 02:
If this were a corporate trustee, would this behavior be excusable?

[00:31:42] Speaker 02:
Absolutely not.

[00:31:43] Speaker 02:
If you ask a specific question.

[00:31:45] Speaker 00:
I think you've got it backwards.

[00:31:46] Speaker 00:
I think it would be more suspicious, because it was this system.

[00:31:52] Speaker 02:
Well, but then there's also that community relationship, right?

[00:31:55] Speaker 02:
They're so close.

[00:31:55] Speaker 02:
There's that level of trust that has been built up over decades, right?

[00:31:59] Speaker 02:
And you lessen your guard.

[00:32:01] Speaker 02:
She implicitly trusted that he would do the right thing.

[00:32:04] Speaker 02:
But the point is, the only reason

[00:32:06] Speaker 02:
that he had the ability to unilaterally request funds on March the 30th is because he had failed to comply with his fiduciary duties in response to the three emails that she had sent prior.

[00:32:17] Speaker 02:
And we know from the record that the first thing she did when she returned to Colorado and hired an independent investment advisor was she changed the authorizations on the account.

[00:32:27] Speaker 02:
And guess what?

[00:32:28] Speaker 02:
Nothing more came out of that account until the family court ordered that there be a distribution to her.

[00:32:34] Speaker 02:
That's how we know the breach has made a difference in this case.

[00:32:37] Speaker 02:
But for his conduct, the loss of the money never would have occurred.

[00:32:42] Speaker 02:
And that's the thing that they keep ignoring.

[00:32:44] Speaker 02:
They want to point only to that contract provision that was in place only because, only was allowed to survive because he breached his fiduciary duties.

[00:32:54] Speaker 02:
And so again, we think that the evidence is clear of trial.

[00:32:58] Speaker 02:
As the jury found, the evidence shows that he had breached his admitted fiduciary duties to the plaintiff, and those breaches were a cause of the $600,000 in economic damages found by the jury.

[00:33:09] Speaker 02:
So we would ask that the court affirm the district court's judgment in full.

[00:33:14] Speaker 00:
I have to ask about the elephant in the room on damages.

[00:33:21] Speaker 00:
The record shows that all evidence regarding

[00:33:27] Speaker 00:
Why wasn't all this taken care of in this division of property in the divorce proceeding?

[00:33:37] Speaker 00:
And that's the real question to me about whether there was damages or not.

[00:33:40] Speaker 00:
But it's not presented to us.

[00:33:42] Speaker 00:
There's nothing I can do about it.

[00:33:43] Speaker 00:
Right.

[00:33:44] Speaker 00:
I think it's not present in the record as well.

[00:33:45] Speaker 00:
But it's just very confusing.

[00:33:47] Speaker 00:
Is there anything?

[00:33:50] Speaker 00:
All I can say is that can you at least say why the judge ruled

[00:33:56] Speaker 00:
that all the evidence of the divorce should be excluded?

[00:34:01] Speaker 02:
I believe it was on the grounds that would be unduly prejudicial, I believe.

[00:34:06] Speaker 02:
I might be mistaken, though.

[00:34:10] Speaker 02:
It would seem to have a lot to do with what the damages were.

[00:34:13] Speaker 02:
My understanding, though, is that, of course, part of the assets are in Mexico.

[00:34:19] Speaker 02:
And I think I'm authorized to say, based on the record, is that she was never fully made whole based on the

[00:34:26] Speaker 02:
the marital estate.

[00:34:28] Speaker 02:
But beyond that, I think it's outside the record, honestly, Your Honor.

[00:34:32] Speaker 02:
So, but what we do know is that he took the two and a half million and that she never got any part of that back.

[00:34:39] Speaker 02:
I mean, that's undisputed, so.

[00:34:42] Speaker 00:
Thank you.

[00:34:43] Speaker 05:
Thank you.

[00:34:44] Speaker 05:
Thank you.

[00:34:46] Speaker 00:
Case is submitted.

[00:34:47] Speaker 00:
Counselor excused.

[00:34:51] Speaker 00:
We'll be in recess until tomorrow.