OMEGA SA, SWATCH SA, Plaintiffs-Appellees, v. 375 CANAL, LLC, Defendant-Appellant.
No. 19-969-cv
United States Court of Appeals FOR THE SECOND CIRCUIT
JANUARY 6, 2021
AUGUST TERM 2019
ARGUED: MARCH 10, 2020
Before: RAGGI, LOHIER, and MENASHI, Circuit Judges.
Defendant 375 Canal, LLC (“Canal“), appeals from a judgment entered June 12, 2019, awarding $1.1 million in statutory damages to Plaintiff Omega SA for Canal‘s contributory infringement of Omega‘s trademarks, arising from sales of counterfeit Omega watches at Canal‘s property in Manhattan. Canal challenges the district court‘s denial of Canal‘s pre-trial motion for summary judgment, the jury instructions on the elements of contributory infringement, several evidentiary rulings, and the scope of the permanent injunction. We reject Canal‘s arguments on all issues. We DISMISS Canal‘s appeal of the denial of summary judgment and AFFIRM the judgment and injunction.
Judge Lohier concurs in part and dissents in part in a separate opinion.
CHRISTOPHER R. NOYES, Wilmer Cutler Pickering Hale & Dorr LLP, New York, New York (Thomas G. Saunders, Isley M. Gostin, and Robert J. Gunther, Jr., on the brief), for Plaintiffs-Appellees.
MISHA TSEYTLIN, Troutman Sanders LLP, Chicago, Illinois (W. Alex Smith and Avi Schick on the brief), for Defendant-Appellant.
After hearing evidence that Defendant landlord 375 Canal LLC (“Canal“) knew of counterfeiting at its leased Manhattan property for years, a jury awarded $1.1 million in statutory damages to Plaintiff Omega SA, a watch company, for Canal‘s contributory infringement of Omega‘s trademarks. On appeal, Canal challenges the judgment entered on March 12, 2019, and amended on June 12, 2019, primarily on the ground that the district court (Crotty, J.) did not require Omega to identify a specific vendor to whom Canal continued to lease property despite knowing or having reason to know of counterfeiting by that same vendor.
At the outset, we reject Canal‘s attempt to raise this argument in the context of the district court‘s pre-trial denial of summary judgment. That interlocutory decision is not appealable. Furthermore, once the case proceeds to a full trial on the merits, the trial record supersedes the record existing at the time of the summary-judgment motion, and there is no basis for this
We nevertheless reach the merits of Canal‘s trademark arguments via its appeal of the jury instructions, and we reject Canal‘s position as inconsistent with our precedent in Tiffany (NJ) Inc. v. eBay Inc., 600 F.3d 93 (2d Cir. 2010). In Tiffany, we held that a defendant may be liable for contributory trademark infringement if it was willfully blind as to the identity of potential infringers—that is, under circumstances in which the defendant did not know the identity of specific infringers. Id. at 109-10. That holding precludes Canal‘s argument that Omega needed to identify a specific infringer to whom Canal continued to lease property. At trial, Omega pursued a theory of willful blindness, and the district court‘s jury instructions accurately captured Tiffany‘s requirements. We therefore reject Canal‘s challenges to those instructions.
Canal also challenges several of the district court‘s evidentiary and damages rulings, including the scope of the permanent injunction. We find no reversible error, and accordingly we affirm the judgment and injunction.
BACKGROUND1
I
Canal owns the property located at 375 Canal Street in Manhattan. The property has a long history of litigation alleging counterfeiting and trademark violations. In 2006, the City of New York sued Canal for nuisance resulting from the sale of counterfeited merchandise at 375 Canal Street. Canal settled, paid an $8,000 penalty, and agreed that 375 Canal Street could not be used in any way for “the sale and/or possession of trademark counterfeit merchandise or pirated merchandise.” Stipulation of Settlement at 2, City of New York v. 375 Canal, LLC, No. 403028/06 (N.Y. Sup. Ct., Cnty. of N.Y. Sept. 20, 2006). Canal also agreed to unannounced warrantless searches by the police.
Also in 2006, Louis Vuitton Malletier sued Canal for counterfeiting activities at 375 Canal Street. Canal entered into a consent order permanently enjoining Canal from violating Louis Vuitton‘s trademarks, requiring Canal to post signs for two years stating that the sale and purchase of counterfeit Louis Vuitton items is illegal, and allowing walk-throughs by Louis Vuitton representatives. See Order for Permanent Injunction on Consent, Louis Vuitton Malletier v. Canal Assocs., L.P., No. 1:06-cv-306 (S.D.N.Y.), ECF No. 4 (Jan. 17, 2006).
In 2009, the City of New York again sued Canal for nuisance resulting from the sale of counterfeit goods at 375 Canal Street. Canal again settled and agreed to a permanent prohibition against the “selling, facilitating the sale or possessing [of] trademark counterfeit merchandise.” Stipulation of Settlement at 3, City of New York v. 375 Canal, LLC, No. 401522/09 (N.Y. Sup. Ct., Cnty. of N.Y. Aug. 14, 2009). Canal also agreed to dismantle all “hidden storage facilities” and again consented to unannounced, warrantless inspections. Id. at 4-5. Canal paid a $10,000 penalty and agreed that the premises would be immediately closed by the police in the event of another violation.
Counterfeit handbags were not the only items sold at 375 Canal Street. During a police sting in December 2010, an individual identified as “Rahman” in police records sold a counterfeit Omega watch inside 375 Canal Street and was arrested.
In May 2012, an Omega private investigator visited 375 Canal Street and documented his purchase of a counterfeit Omega Seamaster watch, which precipitated this lawsuit.
II
In September 2012, Omega sued Canal for contributory trademark infringement, alleging that Canal had continued to lease space at 375 Canal Street despite knowing that vendors at the property were selling counterfeit Omega goods.2
After discovery, Canal moved for summary judgment, contending that Omega had not identified a specific vendor to whom Canal continued to lease property despite knowing or having reason to know that the specific vendor was selling counterfeit goods. In opposition, Omega argued that it did not need to identify a specific vendor because Omega‘s primary theory was one of willful blindness: Canal could not avoid liability by shielding itself from learning the identities of the vendors who were selling counterfeits.
On December 22, 2016, the district court denied Canal‘s motion, agreeing with Omega that under this court‘s decision in Tiffany, 600 F.3d 93, Omega was not required to identify a specific vendor to whom Canal continued to lease its property despite knowledge of counterfeiting by that vendor. Omega SA v. 375 Canal, LLC, No. 12-CV-6979, 2016 WL 7439359, at *3 (S.D.N.Y. Dec. 22, 2016), reconsideration granted in part on other grounds, 324 F.R.D. 47 (S.D.N.Y. 2018); see also Omega SA v. 375 Canal, LLC, No. 12-CV-6979, 2013 WL 2156043, at *4 (S.D.N.Y. May 20, 2013) (addressing the same issue when denying an earlier motion to dismiss).
The case proceeded to trial by jury, which heard the evidence summarized above. Canal objected to the introduction of certain evidence at issue on appeal. Over Canal‘s hearsay objection, the district court admitted an email from a New York City police officer providing details on the December 2010 arrest of “Rahman” for selling a counterfeit Omega watch at 375 Canal Street. On the issue of calculating damages to deter further infringement, the district court also allowed (over Canal‘s objection) the jury to hear limited evidence that Canal‘s proprietors owned other buildings. The district court excluded (again over Canal‘s objection) evidence of
At the close of Omega‘s evidence and also at the end of the trial, Canal moved under
The district court then explained that the scienter requirement could be satisfied by willful blindness: “Reason to know,” the court said, “includes a concept known as willful blindness. Willful blindness means that ... Canal or its agents had reason to suspect that trademark infringing merchandise was being offered or sold but deliberately failed to investigate or looked the other way to avoid seeing such activity.” J. App‘x 2630. To determine whether willful blindness existed, the district court told the jury:
You may consider the nature and extent of the communication between 375 Canal and its tenants, subtenants or other occupants of the premises regarding the infringing acts. You may also consider the extent and nature of the alleged infringement of Omega‘s trademarks. If the infringement is serious and widespread, it is more likely that 375 Canal knew about and condoned the acts of its tenants, subtenants or other occupants of its premises.
J. App‘x 2631.
The jury found that Canal had contributorily infringed four of Omega‘s trademarks on the 2012 counterfeit watch and had done so willfully. The jury awarded $275,000 in statutory damages for each of the four marks, totaling $1.1 million.3
The district court entered judgment on March 12, 2019, and Canal filed a notice of appeal on April 11, 2019. On June 12, 2019, the district court amended the final judgment to include a permanent injunction prohibiting “375 Canal, LLC, and its officers, agents, servants, employees, attorneys, and all other persons in active concert or participation with 375 Canal, LLC or its officers, agents, servants, employees, or attorneys who receive actual notice of this Order by personal service, facsimile service, or otherwise” from infringing, facilitating the infringement of, and taking other actions with respect to Omega‘s marks even outside of 375 Canal Street. J. App‘x 3079-80. On June 25, 2019, Canal filed an amended notice of appeal that included the injunction.
DISCUSSION
On appeal, Canal‘s primary challenge is that the district court did not require Omega to demonstrate that Canal continued to lease space to a specific, identified vendor who Canal knew or should have known was infringing Omega‘s trademarks. Canal raises this argument in two ways: via appeal of the pre-trial order denying Canal‘s motion for summary judgment and via appeal of the jury instructions. We dismiss the former and reject the latter on the merits.
I
Canal argues that the district court erred by denying Canal‘s pre-trial motion for summary judgment, which contended that there was no evidence that Canal continued to lease property to a specific vendor whom Canal knew or should have known was engaging in the sale of counterfeit Omega goods. We dismiss this part of Canal‘s appeal.
A
A party generally cannot “appeal an order denying summary judgment after a full trial on the merits.” Ortiz v. Jordan, 562 U.S. 180, 184 (2011). That order “retains its interlocutory character,” id., and therefore we lack jurisdiction to review it on appeal, see
Even if the district court‘s denial of Canal‘s summary judgment motion qualified for an exception allowing review,5 “the time to seek that review expired well in advance of trial.” Ortiz, 562 U.S. at 189. A notice of appeal generally must be “filed with the district clerk within 30 days after entry of the judgment or order appealed from.”
Moreover, a motion for summary judgment does not preserve an issue for
petition for the right to file an interlocutory appeal pursuant to
Canal provides no explanation for why it could not have pursued one of these paths. At trial, Canal made two
For these reasons, we do not consider Canal‘s appeal relating to the district court‘s denial of its motion for summary judgment.
B
The partial dissent faults us for applying the jurisdictional requirement to file a timely notice of appeal to a party‘s attempt to appeal an order denying summary judgment after trial. See post at 8. But the unanimous holding of the Supreme Court in Ortiz was that such an order generally is not appealable at all because it is interlocutory—and even if it were appealable, the appellant would need to meet the jurisdictional deadline for filing a notice of appeal.7 And Ortiz did not
Despite its acknowledgement that a denial of summary judgment is “not a final judgment,” post at 11, and therefore generally cannot be appealed, see
us why such an approach would be desirable when
II
We nevertheless review the substance of Canal‘s trademark arguments via its challenge to the district court‘s jury instructions on contributory infringement. As noted above, Canal insists that the district court erred by not instructing the jury that Omega had to prove that Canal continued to lease space to a specific, identified vendor that it knew or should have known was selling counterfeit Omega goods.10 We reject Canal‘s argument, which conflicts with this court‘s opinion in Tiffany, 600 F.3d 93.
affirmed the district court‘s verdict that there was no contributory infringement, noting that “Tiffany failed to demonstrate that eBay was supplying its service to individuals who it knew or had reason to know were selling counterfeit Tiffany goods.” Id. at 109.
Canal relies on the portion of Tiffany that describes contributory trademark infringement as occurring when the defendant “continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement,” id. at 108 (emphasis in original) (quoting Inwood, 456 U.S. at 854), meaning that the defendant must be aware of “particular sellers” whom it “knew or had reason to know were selling counterfeit [plaintiff] goods,” id. at 109.12
Canal argues that the district court‘s jury instructions failed to follow these requirements by allowing for liability without a showing that Canal continued providing services to a specific vendor suspected of infringement. But Canal is wrong that actual knowledge of a specific infringer is required in all cases. In the course of holding that the plaintiff must identify particular sellers suspected of counterfeiting, Tiffany explained that evidence of willful blindness would also suffice: “A service provider is not, we think, permitted willful blindness. When it has reason to suspect that users of its service are infringing a protected mark, it may not shield itself from learning of the particular infringing transactions by looking the other way.” Id. A defendant may be willfully blind either to particular transactions or to the identities of infringers: “[I]f eBay had reason to suspect that counterfeit Tiffany goods were being sold through its website, and intentionally shielded itself from discovering the
offending listings or the identity of the sellers behind them,” we said, “eBay might very well have been charged with knowledge of those sales sufficient to satisfy Inwood‘s ‘knows or has reason to know’ prong.” Id. (emphasis added).
Tiffany‘s discussion of willful blindness confirms that a defendant may be held liable for contributory trademark infringement despite not knowing the identity of a specific vendor who was selling counterfeit goods, as long as the lack of knowledge was due to willful blindness. Tiffany therefore precludes Canal‘s argument that Omega was required to identify a specific individual or entity to whom Canal continued to lease its property despite knowing or having reason to know of infringement by that same individual or entity.
At trial, Omega pursued a willful blindness theory. Omega introduced evidence from which a jury could find that Canal had a history of turning a blind eye toward counterfeiting at 375 Canal Street and that Canal had taken insufficient steps to root
trademark infringing merchandise was being offered or sold but deliberately failed to investigate or looked the other way to avoid seeing such activity.” Id. These instructions adequately captured the willful-blindness holding of Tiffany. See 600 F.3d at 110 n.15 (“[C]ontributory liability may arise where a defendant is ... made aware that there was infringement on its site but ... ignored that fact.“).
Canal insists that the verdict below portends widespread liability even for innocent actors. But Tiffany made clear that contributory trademark infringement based on willful blindness does not create liability simply because of a defendant‘s “general knowledge as to counterfeiting on its” property, id. at 107, or because a defendant “fail[ed] to anticipate that others would use its service to infringe a protected mark,” id. at 110 n.15. Tiffany provided a test for identifying which scenarios could result in liability: “[C]ontributory liability may arise where a defendant is ... made aware that there was infringement on its site but ... ignored that fact.” Id. There is no inherent duty to look for infringement by others on one‘s property. Indeed, the district court‘s jury instructions correctly stated that Canal had no affirmative duty to police trademarks:
Even if 375 Canal has control over the premises, 375 Canal has no affirmative duty to take precautions against the sale of counterfeit goods or to seek out and prevent alleged trademark violations, and cannot be found liable if it simply fails to take reasonable preemptive precautions against sales of counterfeit items.
J. App‘x 2629. But where a defendant knows or should know of infringement, whether that defendant may be liable for contributory infringement turns on what the defendant does next. If it undertakes
bona fide efforts to root out infringement, such as eBay did in Tiffany, that will support a verdict finding no liability, even if the defendant was not fully successful in stopping infringement. But if the defendant decides to take no or little action, it will support a verdict finding liability. See Coach, Inc. v. Goodfellow, 717 F.3d 498, 505 (6th Cir. 2013) (upholding liability because the defendant knew or had reason to know of infringement yet continued to lease vending space “without undertaking a reasonable investigation or taking other appropriate remedial measures“). The jury, properly instructed, reasonably found that the latter scenario occurred here.
Accordingly, we reject Canal‘s challenges to the jury instructions on contributory liability.13
Canal next raises several challenges to evidentiary decisions made by the district court during trial. “We review a trial court‘s evidentiary rulings deferentially, and we will reverse only for an abuse of discretion.” United States v. Quinones, 511 F.3d 289, 307 (2d Cir. 2007). To find an abuse of discretion, “we must conclude that the challenged evidentiary rulings were ‘arbitrary and irrational.‘” Id. at
308 (quoting United States v. Dhinsa, 243 F.3d 635, 649 (2d Cir. 2001)). We reject Canal‘s arguments.
A
Canal first contends that the district court erred by admitting—over Canal‘s hearsay objection—a December 2010 email from a New York City police officer to Omega‘s attorney that includes 13 line items apparently copied from an arrest database. One item identifies the arrest of “Rahman” for selling a counterfeit Omega watch at “375 Canal.” The line entries each include a 9-digit alphanumeric arrest identifier generated by the electronic OmniForm system used for maintaining a log of all arrests. Canal argues that this email is inadmissible hearsay and its admission was harmful because it was the only evidence of a counterfeit Omega sale before 2012—that is, the only evidence of the predicate act that put Canal on notice of infringement of Omega trademarks at 375 Canal Street.
We decline to resolve the parties’ dispute about whether this email satisfied the hearsay exceptions for business or public records. See
First, there was substantial evidence of rampant trademark infringement of other marks at 375 Canal Street over a lengthy period of time, suggesting extensive counterfeiting activity, and Canal
admitted at trial that it was aware of the allegation of the 2010 sale of a counterfeit Omega watch and took it seriously. The “jury reasonably could have inferred that even mere allegations of counterfeit sales of non-[Omega] products should have alerted [Canal] to watch out for infringement of [Omega’s] brands,” even if there had been no proof of a prior Omega counterfeit being sold. Luxottica Grp., S.p.A. v. Airport Mini Mall, LLC, 932 F.3d 1303, 1320 (11th Cir. 2019).
Second, and in any event, the December 2010 arrest was discussed in several other documents that were admitted without objection. A September 2011 letter from Swatch to Canal mentioned the same December 2010 arrest at 375 Canal Street for selling a counterfeit Omega watch.14 An October 2011 email from Canal’s own attorney stated that “apparently … an entity … was selling counterfeit goods bearing your clients’ trademarks,” and Canal claimed that its tenant had the “offending tenant removed.” J. App’x 2692. Furthermore,
a full opportunity to cross-examine the officer who pulled the information from the arrest log and put it into the challenged email. See Bridgeway Corp. v. Citibank, 201 F.3d 134, 143 (2d Cir. 2000) (noting that a party challenging the admission of a putative public record must demonstrate “a lack of trustworthiness” in the document).
Accordingly, even if the admission of the December 2010 arrest email were erroneous, it was harmless.
B
Canal also challenges the district court’s admission of evidence at trial that showed widespread trademark violations of non-Omega marks at 375 Canal Street. Canal argues the evidence was irrelevant under
The Eleventh Circuit recently and persuasively rejected the same argument Canal now makes:
[T]he defendants object to the admission of evidence of alleged infringement of non-[plaintiff] brands, arguing that this evidence was also irrelevant and unduly prejudicial because [the plaintiff] failed to show that the non-[plaintiff] goods were actually counterfeit. Yet the jury reasonably could have inferred that even mere allegations of counterfeit sales of non-[plaintiff] products should have alerted the defendants to watch out for infringement of [plaintiff’s] brands, so this evidence was relevant to the jury’s determination of liability.
Luxottica, 932 F.3d at 1319-20. We agree with this logic. If a storefront is willfully blind to widespread trademark infringement under its roof, it is more probable—and therefore the evidence is “relevant” per
The strong relevance also defeats Canal’s
Canal cannot demonstrate that the district court abused its discretion in admitting the evidence of non-Omega counterfeits sold at 375 Canal Street.
Canal next contends that the district court erred by excluding “all evidence relating to Omega’s lost revenues resulting from the May 19, 2012 sale.” Appellant’s Br. 43. This argument is unpersuasive.
Canal never identifies precisely what “evidence” it believes was wrongfully excluded. Pursuant to
Canal also fails to explain how it suffered prejudice. It argues that it was not permitted to offer evidence showing that “Omega would have been unable to prove actual damages.” Appellant’s Reply Br. 23-24. But Omega elected to receive only statutory damages, which is an option the Lanham Act provides “to address the problem facing a plaintiff unable to prove actual damages.” Louis Vuitton Malletier S.A. v. LY USA, Inc., 676 F.3d 83, 110 (2d Cir. 2012). Given that statutory damages were necessarily in lieu of actual damages in this case, Canal cannot show that it was prejudiced by not being allowed to offer evidence refuting an actual-damages claim that Omega did not pursue.
Moreover, the provision allowing for statutory damages for trademark violations says that there may be “an award of statutory damages … as the court considers just.”
The district court accordingly did not abuse its discretion in excluding Canal’s unspecified evidence refuting actual damages that Omega did not pursue.16
Canal argues the district court also abused its discretion by allowing the jury to hear evidence of the personal wealth of Canal’s owners. We reject Canal’s argument.
To be clear, the evidence admitted at trial was not directly on the issue of the owners’ wealth but rather on their ownership of several other buildings, purportedly to show that the owners needed to be deterred across several properties. In accordance with the district court’s ruling limiting evidence in this area, Omega did not offer evidence about the value of the buildings or the owners’ net worth.
This court’s opinion in Psihoyos (in addressing analogous statutory language for damages for copyright violations) stated that one factor that may be considered for statutory damages is “the deterrent effect on the infringer and third parties.” Psihoyos, 748 F.3d at 127. The owners and operators of Canal are the most relevant individuals whose actions need to be deterred, and the jury could have believed the owners were insufficiently attentive to trademark infringement at 375 Canal Street because they owned so many properties, in which case there would be a direct tie between owning other properties and the propriety of higher statutory damages.17
Allowing such evidence was not an abuse of discretion.
IV
Canal’s final argument on appeal is that the district court should have limited the permanent injunction only to actions taken at 375 Canal Street. The scope of a permanent injunction is reviewed for abuse of discretion. Starter Corp. v. Converse, Inc., 170 F.3d 286, 299 (2d Cir. 1999).
The district court’s injunction prohibits infringing, facilitating the infringement of, and taking other actions with respect to Omega’s marks, without any geographic limitation, by “375 Canal, LLC, and its officers, agents, servants, employees, attorneys, and all other persons in active concert or participation with 375 Canal, LLC or its officers, agents, servants, employees, or attorneys who receive actual notice of this Order by personal service, facsimile service, or otherwise.”
Canal’s argument that the injunction is overbroad is foreclosed by Guthrie Healthcare System v. ContextMedia, Inc., which noted that injunctions should be “narrowly tailored” but that “it does not follow that the injunction may extend only into areas for which the senior user has shown probability of confusion” for trademarks. 826 F.3d 27, 46 (2d Cir. 2016). “It is not as if the senior user must prove a new claim of infringement for each geographic area in which it seeks injunctive relief. Once the senior user has proven entitlement to an injunction, the scope of the injunction should be governed by a variety of equitable factors—the principal concern ordinarily being providing the injured senior user with reasonable protection from the junior user’s infringement.” Id.
Ultimately Canal provides no basis for concluding that the district court abused its broad discretion to shape the form of injunctive relief after a jury verdict finding trademark infringement.
CONCLUSION
We DISMISS Canal’s appeal of the district court’s order denying Canal’s pre-trial motion for summary judgment, and we AFFIRM the judgment and permanent injunction.
LOHIER, Circuit Judge, concurring in part and dissenting in part:
I agree with much of the majority opinion. Regrettably, however, I cannot agree with Part I, which improperly dismisses 375 Canal, LLC’s appeal of the District Court’s denial of summary judgment on the ground that we lack jurisdiction to review the denial, even though it raises a purely legal issue. Nor do I agree with Part I’s alternative and altogether unnecessary “holding” that Canal was required to file a notice of appeal within thirty days of the District Court’s order denying summary judgment. That issue was raised not by the parties but by the majority, without the benefit of argument. Instead of dismissing the appeal, I would affirm the judgment.
I
Citing Pahuta v. Massey-Ferguson, Inc., 170 F.3d 125 (2d Cir. 1999), the majority opinion suggests that the denial of summary judgment after a trial on the merits cannot be considered on appeal because Canal could have immediately sought an interlocutory appeal from the denial or filed a post-verdict motion for judgment as a matter of law. See Majority Op. at 11–12. In doing so, the majority contravenes binding precedent and creates an intra-circuit split, as it confuses fact-based appeals from a denial of summary judgment with appeals that mount legal challenges.
In Pahuta, we considered whether we could hear a post-trial, fact-based appeal from the denial of a motion for summary judgment. Pahuta, 170 F.3d at 130–32. We concluded that “such an appeal will not ordinarily lie” for a number of reasons. Id. at 130. A main reason, we explained, is that allowing the appeal would permit appellants to avoid having to move for judgment as a matter of law after a jury verdict under
That approach is consistent with the Supreme Court’s decision in Ortiz v. Jordan, 562 U.S. 180 (2011), which held that “an appellate court is powerless to review the sufficiency of the evidence after trial” where the party making the sufficiency challenge has failed to move for a judgment under
The issue left unaddressed in Ortiz was addressed by our decision in Schaefer v. State Insurance Fund, 207 F.3d 139 (2d Cir. 2000). There we considered an appeal of a denial of summary judgment where the challenged error was purely one of law rather than one that involved some fact-based issue. See id. at 142; see also Steinman, supra, at 918 (explaining that this Court in Schaefer “declared the rule” that a denial of summary judgment is reviewable after a trial where the district court’s error was purely one of law). Likewise in Rothstein v. Carriere, 373 F.3d 275 (2d Cir. 2004), we asserted that a
Why can a party appeal such a denial even after a full trial on the merits? Because “purely legal issues capable of resolution with reference only to undisputed facts . . . typically involve contests not about what occurred, or why an action was taken or omitted, but disputes about the substance and clarity of pre-existing law.” Ortiz, 562 U.S. at 190 (quotation marks omitted). A ”
Until now, we have never deviated from this easily administered rule: “In general, where summary judgment is denied and the movant subsequently loses after a full trial on the merits, the denial of summary judgment may not be appealed . . . . We have recognized an exception to this rule and permitted appeals from the denial of summary judgment after a full trial on the merits where the district court’s error was purely one of law.” Stampf, 761 F.3d at 201 n.2 (quotation marks omitted). Period.3 We have never suggested, as the majority opinion does today, that the “pure issue of law” exception is confined to cases where the “two alternative paths to review“—interlocutory appeal and a
In fact, in Rothstein, we held the opposite. See Rothstein, 373 F.3d at 284. So even if the majority were right that requiring appellants to appeal a
Turning to this case, Canal’s appeal of the denial of summary judgment presents a purely legal question that we have the power to review. Canal argues that in denying its summary judgment motion the District Court improperly used a general knowledge standard rather than the specific knowledge standard required under Tiffany (NJ) Inc. v. eBay Inc., 600 F.3d 93 (2d Cir. 2010). The challenge thus falls under the line of precedent that includes Schaefer and Rothstein and is reviewable even if Canal could have pursued an interlocutory appeal or filed a
II
The majority opinion commits one more needless error. It purports to “hold” in the alternative that Canal was required to file a notice of appeal within thirty days of the entry of the denial of summary judgment. There are two problems with this.
A
First, the conclusion is entirely unnecessary to resolve this appeal and is thus
In any event, as the majority itself makes clear, there is but one decision necessary to resolve this appeal, and in reaching beyond that decision to an alternative “holding” the majority opines on issues beyond the issue that is before us. To see what I mean, recall how the majority opinion introduces the notice of appeal issue. “[E]ven if the district court’s denial of Canal’s summary judgment motion qualified for an exception allowing review,” it asserts, Canal failed to timely file a notice of appeal. See Majority Op. at 11. But the majority opinion had already decided that the denial under consideration does not qualify for an exception allowing review. See id. There was therefore no need whatsoever to add that the notice of appeal should have been filed at a particular time. Had the majority adopted the opposite proposition—namely, that the notice of appeal need not be filed within thirty days of the denial of summary judgment—the result and rationale of the majority opinion would have remained the same. The proposition is thus superfluous—a telltale feature of dictum. Our colleague Judge Leval made this point in his seminal article on dicta:
To identify dictum, it is useful to turn the questioned proposition around to assert its opposite . . . . If the insertion of the rejected proposition into the court‘s reasoning, in place of the one adopted, would not require a change in either the court‘s judgment or the reasoning that supports it, then the proposition is dictum. It is superfluous. It had no functional role in compelling the judgment.
Pierre N. Leval, Judging Under the Constitution: Dicta About Dicta, 81 N.Y.U. L. Rev. 1249, 1257 (2006); see also Baraket v. Holder, 632 F.3d 56, 59 (2d Cir. 2011).4
B
Second, dicta or not, the majority’s conclusion on the notice of appeal issue is legally wrong. Initially, the majority recites the unremarkable proposition that a denial of summary judgment is not immediately appealable because it is not a final judgment, see Soto v. Gaudett, 862 F.3d 148, 157 (2d Cir. 2017), but that an exception exists for denials of summary judgment based on claims of immunity that are purely legal in nature, see id.; Bolmer v. Oliveira, 594 F.3d 134, 140 (2d Cir. 2010). But the majority opinion then takes a wrong turn. It concludes that even if we could review the denial of summary judgment under this exception, our review would be foreclosed here because Canal failed to file a notice of appeal within thirty days after the entry of the order. Because this appeal deadline is jurisdictional, the majority opinion claims, “it independently requires us to dismiss Canal’s challenge to the denial of summary judgment.” Majority Op. at 11.5
An obvious problem with this analysis is that Canal’s challenge to the denial of summary judgment does not fall within the immunity exception, so that filing a notice of appeal immediately after the District Court’s denial of summary judgment here would have been futile. But if the denial of summary judgment was never immediately appealable, then our jurisdictional deadline for filing a notice of appeal could not possibly justify dismissing Canal’s appeal of the denial.
Another problem with the analysis: The majority opinion acknowledges that denials of summary judgment after a full trial on the merits are also not appealable except when the alleged error is purely one of law. See Majority Op. at 11. Yet this does not tell anyone, let alone Canal, when Canal should have filed its notice of appeal. The majority sometimes signals that Canal should have filed a protective notice of appeal to avoid dismissal for late filing, even though, as noted, there is no benefit to filing a notice of appeal of an interlocutory order that is not appealable because doing so would result only in a dismissal of the appeal for lack of subject matter jurisdiction. See Berlin v. Renaissance Rental Partners, LLC, 723 F.3d 119, 127–28 (2d Cir. 2013) (only premature notices of appeal that have “ripen[ed]” are reviewable appeals); O & G Indus., Inc. v. Nat’l R.R. Passenger Corp., 537 F.3d 153, 167 (2d Cir. 2008) (a non-quantified award of attorneys’ fees is non-final and the appeals court was required to dismiss this portion of the appeal for lack of appellate jurisdiction); United States v. Rodgers, 101 F.3d 247, 252 (2d Cir. 1996) (defendant’s appeal of a non-final judgment was “premature” and therefore a “nullity“). The majority opinion elsewhere signals that Canal might have waited to file a notice of appeal until the entry of a final judgment. Of course, that is what Canal did, only to have the
Consider the impact of the majority’s “guidance” in this case. Had Canal filed a notice of appeal within thirty days of the denial of its summary judgment motion but prior to the entry of final judgment, we would have dismissed the appeal for lack of jurisdiction. Canal would then have been required to wait for entry of a final judgment before filing a new notice of appeal and consuming more judicial time, only to then have its appeal dismissed once again for failure to timely file a notice an appeal. The majority’s inability to provide clear answers on these important procedural issues, compounded by its novel legal error, risks significantly burdening our docket by spurring parties in Canal’s position to file protective notices of appeal even though those appeals are likely to be dismissed.
Respectfully, this is not a sustainable way to administer procedural rules and justice for real litigants in real cases.
III
Unfortunately, the majority opinion does not even attempt to square its decision with our prior decisions in Schaefer and RothsteinRule 50 motion could have been filed. Indeed, in Rothstein we affirmatively held that a Rule 50 motion is not required to preserve an appeal from the denial of summary judgment if the challenged error is one of law. Rothstein, 373 F.3d at 284.
Although the majority opinion stands in direct conflict with both decisions, my colleagues have elected to ignore them, apparently in the belief that they are bound by neither. See Schaefer, 207 F.3d at 142; Rothstein, 373 F.3d at 284. Of course, as with so much else in Part I of the majority opinion, that is wrong too. Every panel of our Court is “bound by the decisions of prior panels until such time as they are overruled either by an en banc panel of our Court or by the Supreme Court.” United States v. Wilkerson, 361 F.3d 717, 732 (2d Cir. 2004).
Consistent with Schaefer and Rothstein, Canal’s appeal of the denial of summary judgment presents a purely legal issue and the notice of appeal was filed within thirty days of the final judgment in this case. Nothing more was required to ensure that we have jurisdiction to review the appeal. I would therefore affirm the District Court’s judgment for the reasons set forth in Part II of the majority opinion, rather than dismiss the appeal for lack of jurisdiction.
For these reasons I respectfully dissent from Part I of the majority opinion and otherwise concur.