Counsel's technical error kills off $2.7 million appeal

The Court of Appeals has dismissed as untimely an appeal in a challenge to a $2.4 million judgment because the lead counsel did not file the notice of appeal in time. The Second Circuit says it was the lawyer's fault because his failure to update his email address meant that the ECF system sent the judgment to the wrong location.

The case is Communications Network International v. MCI WorldCom, decided on January 24. This is a bankruptcy dispute. The district court ruled in favor of MCI in the amount of $2.7 million. Judgment was entered on September 24, 2010, and the notice was sent by the Electronic Case Filing system to the email address that counsel registered with ECF when he worked for a different law firm. When counsel moved to a new law firm, he did not update his email address with the ECF system. So the judgment went to the old address, and counsel did not see it until long after the deadline to file a notice of appeal. The district court took mercy on counsel and extended the time to file the notice of appeal. The Court of Appeals reverses, and the appeal is dismissed.

The 30 day deadline to file a notice of appeal is jurisdictional, which means it cannot be changed. Except that sometimes it can be changed, for good cause, i.e., if the clerk's office forgets to send out the judgment or there is some other "excusable neglect." The district court has discretion whether the extend the deadline, but that discretion is not unlimited. Here, the district court abused its discretion. Writing for a 2-1 majority, District Judge Kaplan (sitting by designation) writes, "The purpose of the rule was to ease strict sanctions on litigants who had failed to receive notice of the entry of judgment in order to file a timely notice of appeal, whether the fault lay with the clerk or other factors beyond the litigants’ control, such as the Postal Service. There is nothing in the history of the rules, however, to suggest that the drafters sought to provide relief when the fault lies with the litigants themselves."

Here, the late filing was counsel's fault. When he signed onto the ECF system and created his profile, he agreed to update his contact information. We all agreed to do this, whether we remember doing this or not. Counsel must have forgotten to update his email address when he changed law firms. So the $2.7 million judgment cannot be challenged on appeal. A bad day for the client that wanted to take up the appeal, and a horrendous day for counsel, whose name and email addresses are sprinkled all throughout the decision.