The district court granted summary judgment in favor of the government on Claude P. Brown’s tax refund claim, concluding that Brown had failed to adduce sufficient evidence of bona fide losses during the year in question, 1984. We reverse and remand.
I.
In October 1981 Claude P. Brown 1 opened a trading account with the Houston, Texas office of ContiCommodity Services, Inc. (Conti). In 1982 Brown opened other accounts that were owned jointly by Brown and his business associate, Isaac C. Hem-mings. David Ragan, who managed Con-ti’s Houston office, performed the trading of government securities and commodity futures in Brown’s accounts.
In May 1984 the Houston office of Conti was closed. Conti then claimed that there were deficit equity balances in Brown’s and other customers’ accounts. Eventually
*1106
Conti filed a multi-count complaint against Brown and several other customers, seeking to recover the alleged deficit equity-balances. Several of the customers, in turn, including Brown, contended that Con-ti and Ragan had acted improperly in conducting trading for the customers. Brown and the other customers filed a counterclaim against Conti alleging, among other things, that many of the trades giving rise to the alleged deficit balances were misallo-cated, prearranged or fictitious. The litigation between Brown and Conti, as well as several other cases stemming from activities at Conti’s Houston office, were consolidated for purposes of discovery in a multi-district proceeding pursuant to 28 U.S.C. § 1407. That proceeding, MDL 644, was before Judge Hart in the Northern District of Illinois.
In re ContiCommodity Servs., Inc., Sec. Litig.,
Meanwhile, the Internal Revenue Service had begun investigating the trading performed at Conti’s Houston office. By 1985 the IRS had determined that this trading was a sham and lacked economic substance. Certain deductions claimed by Brown on his 1981 and 1982 tax returns in connection with his Conti accounts were consequently disallowed. The IRS proposed deficiencies against Brown of $9,956,314 for 1981 and $3,282,906 for 1982 based in large part on the disallowance of the deductions associated with Brown’s Conti accounts. Brown challenged these deficiencies by filing a petition in the United States Tax Court.
Brown’s Tax Court cases, along with other cases involving the Conti trading, were assigned to Tax Court Judge Moxley Featherston. In December 1986 Judge Featherston approved a procedure for joining the government in MDL 644, the pending multidistrict litigation, so that issues involving the Conti trading could be resolved in a single forum. As part of that procedure, Brown filed a claim for refund for the year 1984 based on deductions for losses and expenses from the Conti trading that had not been claimed on his original 1984 return. Brown claimed that he had suffered a loss of at least $1,699,550 in the Conti trading, and therefore claimed a refund of $263,966 for 1984. 2 When the claim was promptly disallowed by the IRS, Brown brought an action for refund of taxes in the United States District Court for the Southern District of Florida. Shortly thereafter, the Judicial Panel on Multi-district Litigation transferred the case to the Northern District of Illinois, where it was consolidated with MDL 644.
Brown’s position in the tax refund case was directly opposed to his position in the Conti litigation. To prevail on his tax claim, Brown would ultimately need to establish that he had suffered bona fide economic losses in 1984 as a result of the trading at Conti. In his dispute with Conti, however, Brown’s position was that the trades performed for his account by Conti (or at least a significant portion of them) were shams with no economic substance. Indeed, in response to a directive from the district court during discovery to identify contested trades, Brown took the position that all of the trades at Conti should be disregarded as “bad” trades. The government attempted to use Brown’s position in the Conti dispute as a binding admission in the tax refund case, and moved for summary judgment in the refund suit. Brown responded by arguing that his refund claim against the government was presented as an alternative theory. In the event that he lost in the Conti case, Brown argued, he would be deemed to have suffered bona fide economic losses, and would be entitled to a tax refund for those losses.
In a Memorandum Opinion and Order dated January 11, 1990, Judge Hart resolved several motions for summary judgment and motions to dismiss in the Conti litigation, including the government’s motion. The district judge granted summary judgment in favor of the government in Brown’s and other taxpayers’ refund suits, concluding that the taxpayers had present
*1107
ed insufficient evidence of legitimate losses or deductions for the years in question.
ContiCommodity Sec. Litig.,
II.
We begin by addressing our jurisdiction in this case, an issue that the parties have briefed separately in response to an order of this Court. Pursuant to 28 U.S.C. § 1291, we are authorized to hear appeals from “final decisions” of the district courts. Ordinarily a judgment disposing of fewer than all of the claims or parties in a case is not an appealable final decision absent an express determination pursuant to Federal Rule of Civil Procedure 54(b). Is such a determination required when two or more cases have been consolidated, or do the cases retain their separate identities so' that a final decision in one is immediately appealable?
Fortunately, our cases provide answers. Where cases have been consolidated for all purposes, they become a single judicial unit for purposes of Rule 54(b), and accordingly a judgment that does not dispose of all claims of all parties is not ap-pealable unless the district court makes the findings required by Rule 54(b).
Sandwiches, Inc. v. Wendy’s Int’l, Inc.,
The case at hand does not fall in the gray area, because the extent of consolidation is clear. Under the order of the Judicial Panel on Multidistrict Litigation as well as 28 U.S.C. § 1407, the transfer of the numerous cases in MDL 644 was “for coordinated or consolidated pretrial proceedings.” Since the consolidation was for pretrial proceedings only, the tax refund case retains its separate identity. While the district court did not dispose of all the claims in MDL 644, it did render a final judgment in Brown’s tax case, and that judgment is appealable notwithstanding the lack of a Rule 54(b) determination. We therefore have jurisdiction.
III.
Our review of a decision granting summary judgment is
de novo,
and we draw all reasonable inferences in favor of the non-moving party.
Martin v. Consultants & Adm’rs, Inc.,
In moving for summary judgment, the government argued below that Brown’s position in the Conti case — that all of the 1984 Conti trades should be disregarded as shams or as otherwise illegitimate — was a binding admission that undermined his position in the tax refund case. The government is correct that the positions are inconsistent: under § 165 of the Internal Revenue Code, only bona fide losses are allowed as a deduction. 26 U.S.C. § 165; 26 C.F.R. § 1.165-l(b);
Scully v. United States,
*1108
On appeal, the government no longer seriously argues that Brown is strictly bound in this case by his position in the Conti case, and we believe that the government’s shift in emphasis is well-advised. Brown argued in the district court and argues here that his tax claim is simply an alternative claim, and we see no obstacle to Brown’s approach. Rules 8(e)(2) and 20(a) of the Federal Rules of Civil Procedure specifically allow parties to pursue such alternative and inconsistent claims. 2A & 3A
Moore’s Federal Practice
§§ 8.32, 20.06 (2d ed. 1992);
Douglas Equip., Inc. v. Mack Trucks, Inc.,
Instead of challenging Brown’s alternative-pleading strategy, the government’s principal argument on appeal is that Brown has failed to demonstrate a genuine issue of fact as to bona fide losses for the year 1984, as required by Rule 56 and
Celotex Corp. v. Catrett,
In his affidavit, Kutsenda concluded that the accounts of Brown and Hemmings went from a deficit balance of under $1.5 million on December 31, 1983 to a deficit of nearly $12 million as of May 31, 1984. Kutsenda also determined that Brown’s individual account lost over $5 million during the same period. Moreover, Kutsenda concluded that Conti’s system of tracking government security trades fairly reflected the transactions themselves and represented a reasonable approximation of the market value of the government securities, repurchase transactions and cash in customer accounts. While Kutsenda did not explicitly declare that the trades were not “shams,” his conclusion that Conti’s system fairly tracked actual trades and reflected the fair market value of securities is adequate to give rise to a reasonable inference of true economic losses.
The government argues that summary judgment was proper despite the Kutsenda evidence because of Brown’s failure to comply with Local Rule 12 of the Northern District of Illinois. Under Local Rule 12(m), a party moving for summary judgment must file a memorandum in support of the motion as well as a statement of material facts as to which the moving party contends there is no genuine issue of fact. In response, the nonmoving party must file a submission pursuant to Local Rule 12(n).
3
The response must list the factual assertions of the movant with which the opponent disagrees, and must include references to the evidentiary materials relied on and additional facts requiring the denial of summary judgment.
Bell, Boyd & Lloyd v. Tapy,
Brown’s Rule 12(n) statement did cite Conti’s response to expert witness interrog
*1109
atories and two Conti exhibits purporting to reveal losses in Conti accounts. It did not, however, refer to Kutsenda’s affidavit, which is apparently the strongest evidence of bona fide losses incurred by Brown in 1984.
4
In fact, the Kutsenda affidavit was not executed until a month after Brown filed his response in opposition to the government’s motion for summary judgment. The government, citing
Herman,
We disagree. A crucial problem with the government’s argument has to do with notice. An award of summary judgment is improper when it takes the adverse party by surprise.
Horn v. City of Chicago,
•The flaw in the government’s argument becomes apparent when one looks closely at the parties’ Local Rule 12 statements. The district court did not rely on the Rule 12 statements, and the reason is evident. Nowhere in the government’s “Statement of Undisputed Facts” does the government assert that the Conti trades were actually shams or illegitimate. The government’s statement largely outlines the procedural history of the Conti and tax cases and states that “Taxpayers now contend that none of the trades can be allocated to the first category [i.e., legitimate transactions].” Thus, even a strict application of Local Rule 12, requiring that the moving party’s facts be deemed admitted, would not warrant summary judgment on the issue of the bona fides of the losses.
We conclude that Local Rule 12 does not require the exclusion of the Kutsenda affidavit. First, there is the notice problem just addressed. When summary judgment is granted on a basis not urged by the moving party (and not even supported by the movant’s statement of undisputed facts), the opposing party may be
*1110
taken by surprise if he is strictly limited to the materials cited in his Local Rule 12(n) statement.
Cf. Horn,
Finally, the government contends that the Kutsenda affidavit was not part of the record in the district court because “materials filed under seal are not part of the record unless introduced by a party.” Gov’t Br. at 26. The government’s argument is without merit. Taken together, the Local Rules relied on by the government, Rules 10(d) and 18(B), merely provide that discovery materials shall not be tendered for filing under seal. The Kutsenda affidavit was not “discovery material” as the term is defined in Local Rule 18(A). In fact, it was properly submitted by Conti as part of its opposition to the customer parties’ motion for summary judgment, and it became a part of the record in the district court.
IV.
Brown also appeals from the district court’s denial of his motion for relief from judgment filed pursuant to Federal Rule of Civil Procedure 60(b). That appeal has been docketed as no. 90-1795.
On February 15, 1990, shortly after judgment was entered in the action before us, the IRS concluded an ongoing audit of Brown’s 1984 tax return and issued a report detailing its findings. The report determined that Brown had overpaid his 1984 taxes by nearly $124,000. The recalculation primarily involved deductions for state income taxes and also some Conti transactions unrelated to those at issue in the tax refund case.
Because Brown was concerned that the judgment in the instant case would have res judicata effect on the new refund (because both involved the tax year 1984), he filed a motion for relief from judgment pursuant to Rule 60(b), seeking to amend his complaint to raise claims based on the IRS report. The district court refused to consider Brown’s Rule 60(b) motion, assuming that it had no jurisdiction to do so because a notice of appeal had been filed. In fact, the court did have jurisdiction to consider the motion. Parties may file motions under Rule 60(b) in the district court while an appeal is pending. In such circumstances we have directed district courts
*1111
to review such motions promptly, and either deny them or, if the court is inclined to' grant relief, to so indicate so that we may order a speedy remand.
Graefenhain v. Pabst Brewing Co.,
The parties debate the merits of Brown’s Rule 60(b) motion, but we believe the proper course is to remand for consideration of the issue in the district court, particularly given our decision that the grant of summary judgment must be reversed. See id. We shall therefore dismiss Brown’s appeal from the denial of relief under Rule 60(b).'
V.
In this litigation, Brown faced the prospect of being whipsawed by two creditors. Conti claimed that there were deficits in his accounts amounting to millions of dollars. The government, on the other hand, disallowed any deductions for those losses. Although the Conti dispute has survived summary judgment, the tax dispute has ended in the government’s favor. The result is that Brown may be held liable for the losses while being allowed no deductions for them. Brown faced a sort of procedural “whipsaw” in this case as well. In responding to the government’s motion for summary judgment, he argued against the government’s theory by defending his right to pursue alternative claims. The motion was granted, however, on different grounds — grounds that Brown could have rebutted if given the opportunity.
Because there remains a genuine issue of material fact, the judgment of the district court appealed from in no. 90-1539 is Reversed and the cause is Remanded foy further proceedings not inconsistent with this opinion. Appeal no. 90-1795 is Dismissed as moot.
Notes
. Although Brown's wife Grace is also a party in this tax refund suit, the relevant transactions were engaged in solely by Claude Brown. For simplicity, we use the name "Brown” in reference either to Claude Brown or to the appellants collectively.
. Only Brown's refund claim for the 1984 tax year was at issue in MDL 644 and is involved here. Brown's tax liability for 1981 and 1982 is apparently the subject of pending Tax Court proceedings.
. We refer to the current version of Local Rule 12, although at the time of the district court proceedings the movant’s statement was required by Rule 12(1) and the nonmovant’s statement by Rule 12(m).
. The specific pages referred to in Conti's response to the interrogatories and the two exhibits cited do not clearly pinpoint losses for Brown in 1984. For this reason, the district court held that they were inadequate to reveal a genuine issue of fact. We note, however, that these materials do generally support Brown’s contention of significant losses in Conti accounts during the years 1981-84, and this evidence alone may be enough to create an issue of fact, given that inferences must be drawn in Brown’s favor. The government also raises evi-dentiary objections to these pieces of evidence cited in Brown’s Rule 12(n) statement. Because we conclude that Kutsenda’s affidavit may be considered, we need not rule definitively on the government’s evidentiary objections. We note, however, that such exhibits and interrogatory responses, when they are reliable and relevant, may be considered in determining whether a genuine issue of material fact exists.
Enquip, Inc. v. Smith-McDonald Corp.,