The Supreme Court/The Supreme Court.iso/pc/ascii/1992/92_1123/92_1123.zd

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SUPREME COURT OF THE UNITED STATES
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No. 92-1123
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IZUMI SEIMITSU KOGYO KABUSHIKI KAISHA,
PETITIONER v. U. S. PHILIPS
CORPORATION et al.
on writ of certiorari to the united states court
of appeals for the federal circuit
[November 30, 1993]

  Justice Stevens, with whom Justice Blackmun
joins, dissenting.
  When both parties to a case pending on appeal ask
the appellate court to vacate the judgment entered by
the trial court because they have settled their differ-
ences, should the court routinely take that action
without first considering its effect on third parties?
Subsumed within that question is the related question
whether an affected third party should be allowed to
intervene to object to the vacation of the judgment.  In
this case the Court of Appeals for the Federal Circuit
answered both of those questions incorrectly.
  Petitioner Izumi manufactures electric razors in Japan
that it sells to American distributors, including
Windmere and Sears Roebuck.  It has indemnified those
distributors against liability for patent or trade dress
infringement.  Respondent Philips is a competitor that
has been engaged in protracted litigation with Izumi's
distributors.  In a case filed by respondent in the
Southern District of Florida, the trial court entered a
judgment dismissing respondent's trade dress claims and
awarding Windmere $89,644,257 plus attorneys fees,
interest and costs on an antitrust counterclaim.  In a
second case filed by respondent in the Northern District
of Illinois, the District Court held that the Florida
judgment collaterally estopped respondent from pursuing
certain claims against Sears.  Thereafter, respondent
and Windmere settled their differences on terms that
included a payment to Windmere of $57,000,000 and
Windmere's agreement to join in a motion to vacate the
Florida judgment.
  Izumi was not a party to the settlement.  Promptly
after the settling parties filed their motion in the
Federal Circuit, Izumi tried to object to the vacation of
the Florida judgment.  The court denied the motion on
the ground that Izumi lacked standing, because it was
not a party and its interest was insufficient to support
intervention.  The court then granted the motion to
vacate.  When that action was brought to the attention
of the District Court in Illinois, it reinstated claims
against Izumi's indemnitee (Sears).
  Izumi filed a petition for certiorari presenting a single
question.  The petition itself devoted an entire section
to refuting the Federal Circuit's argument that Izumi's
interest was too insignificant to justify intervention. In
its brief in opposition, respondent argued that the
intervention issue was not properly raised.  After
consideration of respondent's arguments, we nevertheless
decided to grant certiorari.  We might, of course, have
expressly directed the parties to argue the two questions
separately, but it is now apparent that such direction
was unnecessary because their briefs on the merits
canvassed both issues.
  The question whether Izumi should have been allowed
to intervene in the Court of Appeals is -a subsidiary
question fairly included- in the question presented, Rule
14.1(a), because the answer to the intervention question
depends on the validity of the practice of routinely
granting settling parties' motions to vacate trial court
judgments.  For if that routine practice is proper, then
there is no point in allowing intervention.  On the other
hand, if vacation should ever be denied because of the
potential impact on third party interests, it was error to
deny intervention in this case.  If routine vacation is
improper, the Court of Appeals' reasons for denying
intervention were clearly insufficient.  Izumi obviously
had a stake in the outcome of the motion, because the
vacation of the Florida judgment significantly increased
the potential liability and litigation expenses of its
indemnitee.  The fact that Izumi was not a formal party
to the case before it sought to intervene is irrelevant
because the very purpose of intervention is to acquire
the status of a party.
  Even if I were to concede that the intervention
question is not -fairly included- in the question pre-
sented, I would still think it inappropriate to dismiss
the writ of certiorari as improvidently granted.  In view
of the fact that petitioner raised and discussed the issue
in its petition for certiorari, the Court's decision today
rests purely on the technicality that the petition failed
to frame a separate question to introduce this argument.
Given the Court's occasional practice of ordering parties
to address questions they have not raised, it is ironic
that the omission in this case should be given critical
weight.  Indeed, the Court's decision punishes this
technical error much more severely than it has ever
punished similar violations.  Until today, the Court had
never dismissed a case because of a violation of Rule
14.1(a) or its predecessors.
  To justify its decision, the majority quotes Yee v.
Escondido, 503 U. S. ___ (1992), for the proposition that
Rule 14.1(a), although prudential, is disregarded -`-only
in the most exceptional cases,-'- ante, at 5.  But the
majority omits the very next words, which explain that
it is proper to set aside the rule -where reasons of
urgency or of economy suggest the need to address the
unpresented question.-  503 U. S., at ___ (1992) (slip
op., at 14) (emphasis added).  Judicial economy is not
served by invoking prudential rules -after we have
granted certiorari and the case has received plenary
consideration on the merits.  Our decision to grant
certiorari represents a commitment of scarce judicial
resources with a view to deciding the merits of one or
more of the questions presented in the petition.-  Okla-
homa City v. Tuttle, 471  U. S. 808, 815-816 (1985)
(emphasis in original).  See also Canton v. Harris, 489
U. S. 378, 384 (1989).  The Court recently used stronger
language when it refused to dismiss a case on pruden-
tial grounds raised and rejected in the process of grant-
ing certiorari.  The majority noted that the dissent
-proposes that-after briefing, argument, and full
consideration of the issue by all the Justices of this
Court-we now decline to entertain this petition for
the same reason we originally rejected and that we
dismiss it as improvidently granted.  That would be
improvident indeed.  Our grant of certiorari was
entirely in accord with our traditional practice,
though even if it were not it would be imprudent
(since there is no doubt that we have jurisdiction to
entertain the case) to reverse course at this late
stage.-  United States v. Williams, 504  U. S. ___
(1992) (slip op., at 4).

  Our opinion in Yee explains why Rule 14.1(a) ordinar-
ily bars consideration of unpresented questions.  First,
the rule provides notice and prevents surprise, thus
ensuring full briefing; second, the rule allows the Court
to select only cases which present important questions
and to focus its attention on those questions. Yee, 503
U. S., at ___ (slip op., at 14).  Neither reason applies
here.  There was no surprise, because the intervention
issue was raised in the petition for certiorari and in
petitioner's opening brief, and respondent argued the
propriety of denying intervention at every opportunity.
Nor did failure to use the word -intervention- in the
-Question Presented- section of the petition for certiorari
interfere with the efficient selection of cases for plenary
review, since the Court was fully aware that the issue
needed to be resolved in order to reach the vacation
issue.  It is not surprising that Yee's explanation of
Rule 14.1(a) does not fit the circumstances of this case,
because Rule 14.1(a) was never intended to provide the
basis for dismissal, and, before today, was never used
for that purpose.
  The Court today suggests an additional argument for
strict enforcement of Rule 14.1(a), that -there would
also be a natural tendency-to be consciously resisted of
course-to reverse the holding of the Court of Appeals
on the intervention question in order that we could


address the merits of the question on which we actually
granted certiorari.- Ante, at 7.  Reliance on such a
flimsy argument underestimates the character and the
quality of the Court's decisional processes.  Moreover,
this argument overlooks the fact that the Court was
aware of that temptation at the time certiorari was
granted.  Nothing has changed since then to suggest
dismissal is now more appropriate.
   On the merits, I am persuaded that the Federal
Circuit's routine practice is as objectionable as the
practice we recently condemned in Cardinal Chemical
Co. v. Morton Int'l, Inc., 508 U. S. ___ (1993).  While
it is appropriate to vacate a judgment when mootness
deprives the appellant of an opportunity for review,
United States v. Munsingwear, 340  U. S. 36 (1950),
that justification does not apply to mootness achieved by
purchase. Judicial precedents are presumptively correct
and valuable to the legal community as a whole.  They
are not merely the property of private litigants and
should stand unless a court concludes that the public
interest would be served by a vacatur.
  Respondent argues that a policy of routinely vacating
judgments whenever both parties so request will encour-
age settlement.  It will, of course, affect the terms of
some settlements negotiated while cases are pending on
appeal, but there is no evidence that the number of
settlements will be appreciably increased by such a
policy.  Indeed, the experience in California demon-
strates that the contrary may well be true.
Moreover, the facts of this case indicate that any benefit
in the form of saving work for the appellate court will
probably be offset by the added burdens imposed on
trial courts in later proceedings.  On the other hand, it
seems evident that a regular practice of denying these
motions unless supported by a showing of special cir-
cumstances will create added pressure to settle in ad-
vance of trial.  The public interest in preserving the
work product of the judicial system should always at
least be weighed in the balance before such a motion is
granted.  I would therefore reverse the judgment of the
Court of Appeals.