In Re City of Memphis, West Tennessee Chapter of Associated Builders and Contractors, Inc. Zellner Construction Company, Inc. v. City of Memphis
Docket: 01-0503
Court: Court of Appeals for the Sixth Circuit; May 31, 2002; Federal Appellate Court
The City of Memphis sought permission to appeal a district court ruling that barred it from using postenactment evidence to justify racial preferences in awarding construction contracts under its Minority/Women Business Enterprise Procurement Program (MWBE program). Plaintiffs, the West Tennessee Chapter of Associated Builders and Contractors, Inc. and Zellner Construction Company, Inc., contended that the City's request was untimely and did not meet the statutory criteria for interlocutory review under 28 U.S.C. § 1292(b). The court found that interlocutory review was inappropriate and denied the City's application.
The litigation began on January 4, 1999, when the plaintiffs challenged the MWBE program, alleging it violated the Fourteenth Amendment. The City had implemented the program in 1996, citing a disparity study from 1988 to 1992 as evidence of past discrimination. In response to the lawsuit, the City intended to conduct a new study (1993-1998) to support its claim of a compelling governmental interest. The district court ruled on June 9, 1999, that this new evidence could not be presented, initially denying the City's request for interlocutory appeal. After the City sought reconsideration, the district court certified the appeal on December 20, 2000, but the parties were not notified within the 10-day window required for filing an appeal. The district court later granted the City an additional 30 days to file, but this extension was deemed invalid by the appellate court in a May 1, 2001 ruling.
Subsequently, on May 17, 2001, the City requested the district court to vacate and reenter its certification order. After reevaluation, the district court reentered its certification on July 5, 2001, and the City applied for permission to appeal on July 12, 2001. The appellate court noted that the 10-day filing period for an appeal is jurisdictional and cannot be extended, thus affirming the denial of the City's application.
The district court's ability to restart the 10-day period for filing an appeal by vacating and reentering its original certification order is under scrutiny. In Baldwin County Welcome Center v. Brown, the Supreme Court noted that even with a lapsed 10-day period due to improper filing, interlocutory appeals could still be considered, effectively allowing district courts discretion in extending this timeframe. However, in Woods, the court ruled against allowing a district court to vacate and reenter a certification order without reconsideration when the petitioner missed the deadline due to inadvertence, stating it could not achieve indirectly what was not permissible directly.
Contrarily, other circuits, such as the Fifth Circuit, support the idea that a district court may vacate and reenter a certification order to facilitate a timely appeal if the justification for the interlocutory appeal remains valid. The Second Circuit also agrees that recertification is appropriate for judicial efficiency and aligns with the purposes of § 1292(b). The Fourth Circuit stipulates that for recertification, the district court must determine that the failure to file timely was due to excusable neglect and that recertification would not prejudice the other party. Finally, the Third Circuit differentiates between parties who missed deadlines due to lack of notice versus those who were neglectful, highlighting the protective intent of Federal Rules regarding appeal timeliness.
Appellate Rule 4(a) evolved from former Rule 73(a), which allowed appeals for both final and nonfinal judgments, but the omission of relief for failure to receive notice from the clerk concerning nonfinal orders was likely an oversight. The Third Circuit determined that Rule 77(d) should not be interpreted rigidly to deny relief in interlocutory situations, emphasizing that the finality of judgments would not be compromised by reconsideration of an interlocutory order. The court noted that the district court had an obligation to provide adequate notice, and the defendants were justified in expecting notice following their petition. The district court, recognizing a notification error, extended the filing period, leading the City to file for permission to appeal. When the court later ruled it lacked authority to extend the period, the City requested the district court to vacate and reenter the certification order, which the court complied with after reconsideration under § 1292(b).
The Third Circuit affirmed the district court's broad authority to reconsider interlocutory orders to prevent injustices stemming from its own inadvertent actions. Jurisdiction was established for the City’s appeal. For interlocutory appeals under 28 U.S.C. § 1292(b), three criteria must be met: the order must involve a controlling question of law, a substantial ground for difference of opinion must exist, and an immediate appeal should materially advance the litigation's resolution. The City contended that substantial disagreement existed regarding the role of postenactment evidence, which the district court supported based on varying circuit interpretations, though this matter seems resolved in their circuit.
In Associated General Contractors v. Drabik, the district court ruled that the state could not justify a minority preference program based on postenactment evidence, emphasizing the necessity for sufficient preenactment evidence to support racially conscious statutes as established in Croson. The court determined that the lack of preenactment evidence precluded the state from gathering additional postenactment evidence, although it did not categorically rule this evidence as inadmissible. The case highlights that a legal issue is considered controlling only if it materially impacts the case's outcome, and rulings on evidence admissibility fall within the trial court's discretion. The City, having sufficient preenactment evidence, would continue its defense regardless of the evidentiary ruling. If successful, the question of postenactment evidence becomes moot; if not, the City may appeal later. The application to appeal was denied, with dissent from Judge Clay, who believed the evidentiary ruling posed a controlling legal question warranting an interlocutory appeal.
The Court has established that a legal question is considered "controlling" if its resolution could significantly influence the outcome of the litigation, regardless of whether it leads to immediate case dismissal. This perspective is supported by precedent and legal commentary, which suggest that a question is controlling if an interlocutory reversal could save time and costs for the district court and the litigants. In the context of admissibility of post-enactment evidence, this issue is deemed controlling because it would affect the direction and length of discovery, as well as the formulation of dispositive motions or trial strategies. A ruling allowing the City of Memphis to use post-enactment evidence would fundamentally alter the case's nature and have substantial implications for the litigation's outcome. Moreover, affirming Judge Donald's certification order would conserve resources by preventing unnecessary additional discovery and court proceedings if a later final judgment deemed the ruling on post-enactment evidence erroneous. The author expresses dissent regarding these conclusions.
