Wall Guy, Inc. v. Fed. Deposit Ins. Corp.

95 F.4th 862

The WALL GUY, INC.; Jeffrey Frye; JR Contractors, Plaintiffs - Appellants, v. FEDERAL DEPOSIT INSURANCE CORPORATION,as receiver for The First State Bank, Defendant - Appellee.

The Wall Guy, Inc.; Jeffrey Frye; JR Contractors, Plaintiffs - Appellees, v. Federal Deposit Insurance Corporation,as receiver for The First State Bank, Defendant - Appellant.

No. 21-1414

No. 21-1387

No. 23-1380

United States Court of Appeals, Fourth Circuit

Argued: January 23, 2024

Decided: March 18, 2024

Appeals from the United States District Court for the Southern District of West Virginia, at Huntington. Robert C. Chambers, District Judge. (3:20-cv-00304)

ARGUED: Steven Todd Cook, COOK LAW OFFICES, PLLC, Barboursville, West Virginia, for Appellants/Cross-Appellees. John William Guarisco, FEDERAL DEPOSIT INSURANCE CORPORATION, Arlington, Virginia, for Appellee/Cross-Appellant. ON BRIEF: B. Amon James, Assistant General Counsel, J. Scott Watson, Senior Counsel, FEDERAL DEPOSIT INSURANCE CORPORATION, Arlington, Virginia, for Appellee/Cross-Appellant.

Before AGEE, WYNN, and THACKER, Circuit Judges.

Dismissed by published opinion. Judge Wynn wrote the opinion, in which Judge Agee and Judge Thacker joined.

WYNN, Circuit Judge:

This case originates from a lending relationship between Plaintiffs—Jeffrey Frye and his companies The Wall Guy, Inc., and JR Contractors—and First State Bank ("the Bank"). When that relationship soured, the parties sued each other. What followed was nearly a decade of litigation, including two state-court lawsuits, a jury trial, post-trial motions, removal to federal district court, and motions practice in that court.

As it comes to us on appeal, however, this case turns on the threshold question of whether Plaintiffs have properly invoked our appellate jurisdiction. Because we conclude that they have not, we dismiss the appeal for lack of jurisdiction.

I.

We begin with the relevant factual history.

In January 2016, Plaintiffs sued the Bank in West Virginia state court for, in relevant part, breach of contract ("First Case"). A few months later, the Bank sued Plaintiffs—also in state court—alleging that they had defaulted on various loans ("Second Case"). The court in the Second Case found Plaintiffs had no equity in certain collateral and directed it be surrendered to the Bank. Plaintiffs did not seek timely reconsideration of or appeal that order, and there were no further entries on the docket in the Second Case until 2019.

Meanwhile, in August 2018, the First Case proceeded to a jury trial. The jury awarded Plaintiffs $1,500,000. Following the verdict, the parties entered into an agreement to secure the judgment ("the Pledge Agreement"), with specific real estate identified as collateral.

In March 2019, the state court granted the Bank's request for remittitur of the jury verdict. The court concluded that the jury's award must have included some inappropriate items, namely, attorneys' fees and costs and the value of the repossessed collateral in the Second Case. Accordingly, the court reduced the verdict to $524,023. The court then entered final judgment in that amount and notified Plaintiffs that they could accept the judgment, request a new trial, or appeal. Plaintiffs elected to appeal to the Supreme Court of Appeals of West Virginia.¹ The Bank filed a cross-appeal. Wall Guy, Inc. v. FDIC., No. CV 3:20-0304, 2021 WL 838889, at *2 (S.D.W. Va. Mar. 5, 2021). In June 2019, the state trial court stayed any further action in the Second Case pending resolution of the appeal in the First Case. Id.

Before the appeal in the First Case could be resolved, however, the Bank was found to be insolvent, resulting in the Federal Deposit Insurance Corporation being appointed as receiver ("FDIC-R") on April 3, 2020. Pursuant to its authority under 12 U.S.C. § 1819(b)(2)(B), the FDIC-R removed both cases—the First and Second—to federal district court on April 30, 2020. The court consolidated both cases and then stayed them while Plaintiffs completed the mandatory administrative-claims process.

After the stay was lifted, the district court issued an order dated March 5, 2021, concluding that, under this Court's decision in Resolution Trust Corp. v. Allen, 16 F.3d 568 (4th Cir. 1994), upon removal, it had to adopt the state-court judgment as its own. Wall Guy, 2021 WL 838889, at *3. The court noted that, once it did so, the ordinary post-judgment remedies would be available; for example, the parties could file motions pursuant to the Federal Rules of Civil Procedure or could appeal. Id. Accordingly, the district court adopted the state-court remittitur award of $524,023 and gave Plaintiffs the option of either accepting the remittitur or electing a new trial. Id. at *3-4. Three days later, Plaintiffs filed a response accepting the remittitur. In light of that response, on March 15, 2021, the district court entered judgment in favor of Plaintiffs in the amount of $524,023 ("2021 Judgment").

On April 7, 2021, the FDIC-R timely filed a Rule 59(e) motion to amend the 2021 Judgment and a notice of appeal. Four days later, Plaintiffs also filed a Rule 59(e) motion and notice of appeal. Plaintiffs' notice of appeal stated that they thereby appealed to this Court "from Judgement Order [ECF No. 38] entered in this action on March 15^th, 2021 and all orders and ruling submitted therein, including but not limited to, the Memorandum Opinion Order [ECF No. 34] entered on March 5^th, 2021, and/or any rulings on pending Rule 59(e) post-judgment motions etc." J.A. 1384 (bracketed text in original).²

This Court consolidated the cross-appeals and suspended proceedings on appeal pending resolution of the Rule 59(e) motions. In the notice regarding suspension of the proceedings, this Court "directed [the parties] to immediately inform [the Clerk's] [O]ffice in writing of the district court's ruling on the motion [for reconsideration] and whether they intend to appeal the ruling." Jurisdictional Notice at 1, Wall Guy, Inc. v. FDIC, No. 21-1414 (4th Cir. Apr. 15, 2021), ECF No. 4. Later, this Court also remanded the case for the limited purpose of allowing the district court to rule on those motions. In our remand order, we directed the parties to submit regular reports on the status of the motions.

In October 2022, the FDIC-R filed an emergency motion in the district court to enforce a provision of the Pledge Agreement requiring the parties to "negotiate" a new Pledge Agreement "without delay and in good faith" if there was a remittitur. J.A. 1344. The FDIC-R contended that, "[b]ecause Plaintiffs accepted a remittitur reducing the judgment from $1.5 million to $524,023, and in order to clear recent cloud-on-title issues on the existing collateral, the [FDIC-R] attempted to exercise its rights under" that provision, but was rebuffed. J.A. 1429. Plaintiffs opposed the FDIC-R's emergency motion and filed their own motion to enforce the Pledge Agreement, arguing that the FDIC-R had breached the "deed of trust" attached to the Pledge Agreement by selling "at least two pieces of property" secured by that agreement. Plaintiffs' Motion to Enforce the Parties' Pledge Agreement at 4, Wall Guy, Inc. v. FDIC, No. 3:20-cv-00304 (S.D.W. Va. Nov. 1, 2022), ECF No. 76; see J.A. 1346.

On November 17, 2022, the district court resolved the motions pertaining to the Pledge Agreement, granting the FDIC-R's motion and denying Plaintiffs' ("Pledge Agreement Order"). The court ordered the FDIC-R "to provide substitute collateral in the form of a letter of credit for $524,023" and Plaintiffs "to release their judgment liens on the properties listed in the Pledge Agreement" within seven days of receipt of that letter of credit. J.A. 1451.

Plaintiffs did not file a notice of appeal in response to the district court's entry of the Pledge Agreement Order. Instead, the next filing on the district court docket was entered on February 7, 2023, when the district court entered an order resolving the pending Rule 59(e) motions, denying Plaintiffs' motion and granting the FDIC-R's motion in part ("Rule 59 Order").

As to the First Case, the court concluded that, while the jury's verdict was excessive, remittitur was improper because there was no way for the state court to fairly reduce the verdict without engaging in improper speculation about the jury's calculations. But the court noted that, while this scenario would normally require a new trial, no new trial was warranted because the breach-of-contract claim was statutorily unenforceable against the FDIC-R.

As to the Second Case, because the court concluded it was unclear whether the FDIC-R sought further relief in that matter, the court requested clarification from the FDIC-R. That resulted in the FDIC-R moving to dismiss the Second Case without prejudice.

The district court then entered judgment on February 15, 2023, granting final judgment in favor of the FDIC-R on the First Case while dismissing the Second Case without prejudice ("2023 Judgment") (together with the Rule 59 Order, the "2023 Orders"). Plaintiffs again did not file a notice of appeal on the district court docket.

Instead, on February 28, 2023, Plaintiffs filed a status report before this Court, noting that the district court "rendered an Order on February 15^th, 2023 resolving the pending motions [for reconsideration]." Status Report at 1, Wall Guy, Inc. v. FDIC, No. 21-1414 (4th Cir. Feb. 28, 2023), ECF No. 30. They stated that "[t]he matter appears ripe for cross-appeal." Id. And on March 6, 2023, Plaintiffs filed the standard docketing-statement form this Court requires of counseled appellants. See 4th Cir. R. 3(b); Docketing Statement, Wall Guy, Inc. v. FDIC, No. 21-1414 (4th Cir. Mar. 6, 2023), ECF No. 33 [hereinafter "Docketing Statement"].

On April 7, 2023, the FDIC-R filed a timely "notice of conditional cross-appeal," seeking a new trial in the event this Court "reverses or vacates in whole or in part any order or judgment that [P]laintiffs have...