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HORN & HARDART CO. v. AMTRAK

April 23, 1987

The Horn & Hardart Company, Plaintiff,
v.
National Railroad Passenger Corporation, Defendant



The opinion of the court was delivered by: GASCH

 MEMORANDUM

 I. INTRODUCTION

 In Horn & Hardart Co. v. Nat'l R.R. Passenger Corp., Civil Action No. 85-0820 (D.D.C. May 30, 1985) (" Horn & Hardart I "), aff'd, 793 F.2d 356 (D.C. Cir. 1986), this Court held that, pursuant to certain contracts, National Railroad Passenger Corporation ("Amtrak" or "the Railroad") had the right to terminate three restaurant leases of The Horn & Hardart Company ("Horn & Hardart" or "the Company") at the Pennsylvania Station ("Penn Station") in New York. *fn1" Accordingly, the Court denied plaintiff Horn & Hardart's requests for (1) a declaratory judgment that Amtrak's attempted termination of the leases was unlawful; (2) an injunction preventing Amtrak from attempting to oust Horn & Hardart from the premises; and (3) an award of damages of not less than $ 2.5 million.

 In the wake of Horn & Hardart I's affirmance on appeal, Amtrak, the original defendant, took the initiative and filed a petition for an award of "further relief" against Horn & Hardart pursuant to 28 U.S.C. § 2202. *fn2" On the basis of certain provisions in the operative leases, Amtrak alleges that it is entitled to recover damages for Horn & Hardart's hold-over at Penn Station during the litigation of Horn & Hardart I and for attorney fees and court costs arising out of Horn & Hardart's decision to hold-over. For reasons provided hereafter, the Court grants Amtrak much of the relief it requests.

 II. BACKGROUND

 Few facts are necessary to evaluate Amtrak's petition. On November 29, 1984, Amtrak transmitted three notices to Horn & Hardart instructing the Company that its three Penn Station leases would terminate after 90 days. Despite this notice, Horn & Hardart did not vacate its leaseholds. Instead, the Company initiated Horn & Hardart I in an effort to demonstrate that Amtrak's termination was improper.

 Nearly three months later, on May 30, 1985, this Court upheld Amtrak's position. See Horn & Hardart I at 9. Notwithstanding that ruling, Amtrak had to prosecute three consolidated actions in New York landlord-tenant court over a two-month period to recover its properties. See National Railroad Passenger Corporation v. The Horn & Hardart Co., L and T Index Nos. 36876/85, 36877/85, 36878/85 (N.Y. Civ. Ct., Part 52) (Petitioner's Opposition to Respondent's Motion to Dismiss at Exhibit A). Consequently, on August 5, 1985, Horn & Hardart vacated the Penn Station premises. Upon departure, in compliance with a liquidated damage provision in the lease, Amtrak paid Horn & Hardart $ 180,000 to compensate the Company for losses occasioned by Amtrak's early termination of the leases. Id.; see Horn & Hardart Co. v. Nat'l R.R. Passenger Corp., 253 U.S. App. D.C. 285, 793 F.2d 356, 360 (D.C. Cir. 1986). It is noteworthy that, during the five-month hold-over period, Horn & Hardart also continued to profit from its food concessions at Penn Station.

 III. HORN & HARDART'S MOTION TO DISMISS

 Before considering Amtrak's request for damages, the Court first addresses the jurisdictional, procedural and substantive arguments raised by Horn & Hardart to block disposition of this matter on the merits.

 Horn & Hardart first challenges the jurisdiction of this Court. Respondent founds its argument on an alleged procedural defect. After this Court rejected Horn & Hardart's original claims, the Company appealed the decision to the Court of Appeals for this Circuit. Horn & Hardart correctly maintains that its notice of appeal divested this Court of jurisdiction over "those aspects of the case involved in the appeal." Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 58, 74 L. Ed. 2d 225, 103 S. Ct. 400 (1982). From this premise, the respondent concludes that "the Court of Appeals' June 17, 1986 affirmance of this Court's judgment resolved all outstanding issues in this proceeding, leaving nothing for this Court to decide." Respondent's Motion to Dismiss at 6. The Court finds this conclusion unsubstantiated and erroneous.

 It is irrefutable that an appellate mandate is completely controlling as to all matters decided and disposed of by the decree. See Elias v. Ford Motor Co., 734 F.2d 463, 465 (1st Cir. 1984); I. B. J. Moore, J. Lucas & T. Currier, Moore's Federal Practice para. 0.404[10] (2d ed. 1983). A district court obviously cannot flaunt matters addressed by an appellate mandate. See Briggs v. Pennsylvania R. Co., 334 U.S. 304, 306, 92 L. Ed. 1403, 68 S. Ct. 1039 (1948). Those cases cited by the respondent illustrate only this principle; each involved a lower court's attempt to enlarge a specific appellate mandate by increasing the amount of judgment the mandate specified. See, e.g., Elias, supra, 734 F.2d at 465 (attempt by district court to modify amount of appellate award by adding prejudgment interest). No case cited by respondent addresses a situation comparable to the one in this case, where the appellate mandate is silent as to matters addressed to the District Court after the conclusion of appellate review and a federal statute contemplates a return to the District Court.

 The Court concludes that where there is statutory authority to return to the district court, and jurisdiction would otherwise be proper, litigation secondary to the original may proceed even though an appellate mandate does not expressly grant jurisdiction. *fn3" Section 2202 of the Declaratory Judgments Act expressly provides for "further relief." 28 U.S.C. § 2202, supra, at note 2. This provision has been interpreted as providing for "supplemental" relief which may be granted in a proceeding subsequent to the original. Borchard, Declaratory Judgments 438-41 (2d ed. 1941). As such, courts have routinely allowed separate proceedings for further relief in the District Court which heard the original case even though an appellate court has rendered a decision upholding the judgment in the interim. In McNally v. Am. States Ins. Co., 339 F.2d 186 (6th Cir. 1964), the plaintiffs instituted an action for declaratory judgment against their insurance carrier to ascertain the extent of their liability in actions brought against them by certain third parties. The District Court held that the policy wholly insured the plaintiffs. That judgment was affirmed on appeal. Thereafter, the plaintiffs returned to the District Court and filed a "Petition for Further Relief" pursuant to 28 U.S.C. § 2202. The Sixth Circuit affirmed the propriety of this procedure. Id. at 187; see Valley Oil Co. v. Garland, 499 S.W.2d 333 (Tex. Civ. App. 1973); see also McCann v. Kerner, 436 F.2d 1342, 1343 (7th Cir. 1971) (section 2202 "contemplates that subsequent to the issuance of a declaratory judgment, a court may [grant further relief]"). *fn4"

 B. Scope of Section 2202

 Horn & Hardart's second concern is with the reach of section 2202. The respondent concedes that "further relief" embraces coercive remedies like damages. See Borchard, supra, at 441. However, Horn & Hardart argues that any damages "must in fact be 'further relief' which is 'based on' the declaratory judgment -- an alternative form of relief to which the litigant has already proved his entitlement in the declaratory judgment action." Respondent's Motion to Dismiss at 10 (citing 28 U.S.C. § 2202).

 Respondent's construction of section 2202 is unduly narrow and does not state the law of the federal courts. Section 2202 expressly provides that "further relief" must be "based on" a declaratory judgment. Respondent construes the words "based on" to mean that further relief is only appropriate to effect a declaratory judgment. A few state courts have so held. In Oklahoma Alcohol Beverage Control Bd. v. Central Liquor Co., 421 P.2d 244 (Okla. 1966), the Court held that the Oklahoma Declaratory Judgment Act, which tracks the Uniform Declaratory Judgments Act, 9A Uniform Laws Annotated 1, only authorizes "further relief" "wherever such relief becomes necessary in order to effectuate the declaratory judgment." Central Liquor Co., supra, 421 P.2d at 247 (emphasis added). See also State Farm Mutual Auto Ins. Co. v. Mohan, 85 Ill. App. 2d 10, 228 N.E.2d 283, 290 (Ill.App.Ct. 1967) (the Illinois Declaratory Judgments Act "contemplates further relief based on the rights determined [in the earlier declaratory judgment proceeding]").

 State precedent is, of course, not binding on this Court. Moreover, the cases relied upon by Horn & Hardart are not persuasive since neither bothers to closely read the language of their respective declaratory judgments statutes. Further relief, based on the original declaratory judgment, may be granted wherever it is either "necessary or proper." 28 U.S.C. § 2202 (emphasis added). Propriety is of course a broader concept than necessity. In consideration of this language, the requirement that a plea for further relief must be "based on" the declaratory judgment should be broadly read. In Edward B. Marks M. Corp. v. Charles K. Harris Music Publishing Co., 255 F.2d 518 (2d Cir.), cert. denied, 358 U.S. 831, 3 L. Ed. 2d 69, 79 S. Ct. 51 (1958), the Second Circuit held that a plaintiff who had initiated a declaratory judgment action to establish ownership rights in certain copyrights could thereafter petition for further relief pursuant to section 2202 for an adjudication of infringement and an accounting. Id. at 520, 522. Likewise, Amtrak's present claims for damages flow directly from the judgment of this Court. The Court finds it both proper and efficient for Amtrak to prosecute its claims in a petition for further relief. Having decided the action upon which Amtrak's petition is founded, the Court is familiar with the case. To force Amtrak to initiate a new lawsuit which might be heard by a different court would be wasteful of judicial resources.

 C. Timeliness

 Horn & Hardart's third contention is that Amtrak's request for further relief is time barred by Federal Rule of Civil Procedure ("Rule") 59(e). That Rule states, "[a] motion to alter or amend the judgment shall be served not later than ...


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