Valdez v. Derrick, III et al
ORDER Granting in Part and Denying in Part 335 Plaintiff's Motion for Prejudgment Interest. Entered by Judge William J. Martinez on 11/1/2021.(lrobe)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge William J. Martínez
Civil Action No. 15-cv-0109-WJM-STV
ROBERT MOTYKA, Jr., Denver Police Officer, in his individual capacity, and
CITY AND COUNTY OF DENVER, a municipality,
ORDER GRANTING IN PART AND DENYING IN PART
PLAINTIFF’S MOTION FOR PREJUDGMENT INTEREST
On September 23, 2021, a jury awarded Plaintiff Michael Valdez $131,000
against Defendant Robert Motyka and $2,400,000 against Defendant City and County
of Denver (“Denver”) (jointly, “Defendants”). (ECF No. 329.)
Before the Court is Plaintiff’s Motion for Prejudgment Interest (“Motion”), filed
October 5, 2021. (ECF No. 335.) Defendants responded on October 12, 2021 (ECF
No. 337), and Plaintiff replied on October 18, 2021 (ECF No. 338). For the reasons
explained below, the Motion is granted in part and denied in part.
I. LEGAL STANDARD
“The award of prejudgment interest under federal law ‘is to compensate the
wronged party for being deprived of the monetary value of his loss from the time of the
loss to the payment of judgment.’” Zuchel v. City & Cnty. of Denver, Colo., 997 F.2d
730, 746 (10th Cir. 1993) (quoting U.S. Indus., Inc. v. Touche Ross & Co., 854 F.2d
1223, 1256 (10th Cir. 1988)). Although prejudgment interest is ordinarily awarded in a
federal case, it is not recoverable as a matter of right. Id. Instead, an award of
prejudgment is governed by a two-step analysis: “First, the trial court must determine
whether an award of prejudgment interest would serve to compensate the injured party.
Second, when an award would serve a compensatory function, the court must still
determine whether the equities would preclude the award of prejudgment interest.”
White v. Chafin, 862 F.3d 1065, 1068 (10th Cir. 2017) (quoting Zuchel, 997 F.2d at
Whether Prejudgment Interest Would Serve to Compensate Plaintiff
Plaintiff argues that the Court should award prejudgment interest on: (1)
$130,844—the amount of the medical bills that Plaintiff incurred—from January 16,
2013 to September 23, 2021; and (2) the remaining $2,400,156 in damages awarded by
the jury from August 1, 2016 to September 23, 2021. (ECF No. 335 at 12.) Plaintiff
asserts that prejudgment on the second amount is “based on the significant amount of
pretrial delay caused by successive defense appeals, overestimation by the defense of
necessary trial days, and the defense requested continuance of the July 2020 trial,”
which allowed Defendants to “unfairly and unjustly maintain[ ] the use and benefit of
the money to Mr. Valdez’s detriment.” 1 (Id. at 2.) Plaintiff further argues that “[a]ll
Plaintiff selected August 1, 2016 as a requested beginning date for prejudgment
interest, which is approximately 18 months from the date he filed the lawsuit; according to
Plaintiff, this is the recommended time for a case to be scheduled for trial. (ECF No. 335 at 10.)
In support, he cites a Frequently Asked Questions webpage for the U.S. Courts that recognizes
that “[o]ne goal established under the legislation is for each civil case to be scheduled for trial
within 18 months of filing the complaint.” (Id.; U.S. Courts, FAQs: Filing a Case, available at
https://www.uscourts.gov/faqs-filing-case).) However, as Defendants point out, the average
prejudgment interest should be awarded against both Defendants jointly and severally.”
Defendants respond that an award of prejudgment interest on Plaintiff’s noneconomic damages is both unnecessary, inequitable, and inconsistent with controlling
Tenth Circuit precedent. (ECF No. 337 at 2–3.) Defendants further argue that
deterrence is not a proper justification for awarding prejudgment interest generally, or
specifically here, as Defendants are not solely responsible for the delays in this case.
(Id. at 6–7.) Finally, Defendants assert that there is no basis for the Court to impose
joint-and-several liability for prejudgment interest. (Id. at 9–10.)
The Court concludes that an award of prejudgment interest on Plaintiff’s medical
bills would serve to compensate Plaintiff for being deprived of the monetary value of his
loss from the date of his injury to judgment. See Zuchel, 997 F.2d at 746. However,
after carefully considering the parties’ arguments, the Court cannot conclude that
Plaintiff is entitled to prejudgment interest on his non-economic damages.
Numerous courts within the Tenth Circuit have found “the notion of prejudgment
interest to be incompatible with the concept of non-economic damages.” White v.
Wycoff, 2016 WL 9632932, at *2 (D. Colo. July 7, 2016) (quoting Clawson v. Mt. Coal
Co., 2007 WL 201253, at *14 (D. Colo. Jan. 24, 2007)); see also Hall v. Terrell, 648 F.
Supp. 2d 1229, 1232 (D. Colo. 2009) (recognizing that although plaintiff’s injuries were
horrific, her emotional distress, mental anguish, and suffering did not “deprive [her] of
the monetary value of [her] loss from the time of the loss to the payment of the
judgment” and that an award of prejudgment interest on this portion of the judgment
time in the District of Colorado from civil case filing to jury trial in 2019 was 30.97 months. (ECF
would “duplicate damages already awarded”); Chatman v. Buller, 2013 WL 5729603, at
*3 (E.D. Okla. Oct. 22, 2013) (same).
As the court explained in White,
[p]rejudgment interest is designed to compensate a plaintiff
for the monetary value of his loss from the time of the injury
until the payment of judgment. Put differently, the doctrine of
prejudgment interest recognizes the time value of money,
and compensates for lost value that would have otherwise
accrued had the plaintiff been able to invest or gather
interest on monies that were lost as a result of his injury.
Unlike a hard asset, such as money spent to pay medical
bills arising from an injury at the hands of the police, one
cannot invest undamaged feelings or emotional wellbeing in
the stock market. An award of prejudgment interest on noneconomic damages would therefore “imply the preposterous
notion that one’s suffering could, at the time, have been
used as an investment vehicle.”
2016 WL 9632932, at *2 (quoting Clawson, 2007 WL 201253, at *14); see also Wilson
v. Burlington N. R. Co., 803 F.2d 563, 567 (10th Cir. 1986) (McKay, M., concurring)
(recognizing that an award of damages for pain and suffering “is merely the reduction of
that sentimental value to dollars at the time of judgment and does not in any real or
analytical sense represent the return of the loss of the use of money” and that, as such,
an “award of foregone interest on these amounts would be inappropriate”).
None of the cases upon which Plaintiff relies mandates a different result. Most of
those cases either involve claims arising under Colorado law, see, e.g., David v. Sirius
Computer Sols., Inc., 779 F.3d 1209, 1211 (10th Cir. 2015); Mladjan v. Pub. Serv. Co.
of Colo., 797 P.2d 1299, 1303 (Colo. App. 1990), or do not address the conceptual
distinction between economic and non-economic damages, see, e.g., City of Milwaukee
No. 337 at 9.)
v. Cement Div., Nat. Gypsum Co., 515 U.S. 189, 195–96 (1995); Guides, Ltd. v.
Yarmouth Group Property Management, Inc., 295 F.3d 1065, 1077 (10th Cir. 2002);
Carr v. Fort Morgan Sch. Dist., 4 F. Supp. 2d 989, 997 (D. Colo. 1998). Accordingly, for
the reasons set forth above, the Court will only award prejudgment interest on the
amount of Plaintiff’s medical bills—i.e., $130,844.
Moreover, the Court will assess prejudgment interest against Defendant Motyka
alone. Based on the fact that the jury returned a verdict of $131,000 against Defendant
Motyka, it is evident that the jury intended that Defendant Motyka pay Plaintiff’s medical
Whether Equities Preclude An Award of Prejudgment Interest
After carefully considering the history of this case and the circumstances of the
parties, the Court concludes that the equities do not preclude an award of prejudgment
interest. More than eight years have passed since Plaintiff was shot by Defendant
Motyka on January 16, 2013. This action has been hard fought at every stage, and the
Court concludes that it is equitable that Defendant Motyka pay an appropriate amount of
Applicable Prejudgment Interest Rate & Calculation
Having determined that an award of prejudgment interest on Plaintiff’s economic
damages is appropriate, the Court must next determine, in its discretion, what interest
rate to apply. Kleier Advertising, Inc. v. Premier Pontiac, Inc., 921 F.2d 1036, 1042 n.4
(10th Cir. 1990) (“[b]ecause there is no federal statutory interest rate on prejudgment
interest, the rate imposed will be left to the trial court’s discretion.”); see also Mickelson
v. Proctor, 2017 WL 4335093, at *3 (D. Colo. Mar. 20, 2017) (recognizing that
neither 42 U.S.C. § 1983 nor 42 U.S.C. § 1988 addresses prejudgment interest or an
applicable rate). The Court considered a number of possible applicable interest rates.
For example, because this action deals with personal injuries sustained as a
result of Defendants’ unconstitutional acts, the Court considered using the prejudgment
interest rate for personal injury actions in Colorado, i.e., nine percent simple interest
from the date the action accrued to the date the suit was filed, and nine percent
compounded annually from the date of the filing of the lawsuit to the date of judgment.
Colo. Rev. Stat. § 13–21–101(1). However, the Tenth Circuit has held that “a federal
rate of interest rather than the state rate applies where jurisdiction is based on a federal
question.” Guides, 295 F.3d at 1077. Moreover, in the undersigned’s view, a nine
percent interest rate is out of line with current interest rates and would result in a
windfall to Plaintiff for the loss of use of his money.
The Court further considered using the postjudgment interest rate set forth in 28
U.S.C. § 1961, which is calculated at a rate equal to the weekly average 1-year
constant maturity Treasury yield (currently 0.14%). See Bd. of Governors of the Fed.
Reserve Sys., Selected Interest Rates, available at https://www.federalreserve.gov/
releases/h15/. However, the Court concludes that this de minimis interest rate is not
equitable either, as it would surely undercompensate Plaintiff for the loss of his money
given the economic realities of the current financial environment in this country.
Therefore, as the Court has done in past cases, the undersigned will utilize the
IRS underpayment rate as the applicable prejudgment interest rate. Pursuant to 26
U.S.C. § 6621(a)(2), the IRS underpayment rate is calculated as the sum of the federal
short-term rate plus 3 percentage points. This underpayment rate is currently 3%. See
News Release, IRS, Interest rates remain the same for the fourth quarter 2021,
available at https://www.irs.gov/newsroom/interest-rates-remain-the-same-for-thefourth-quarter-2021.
The Court will calculate the prejudgment interest rate starting on January 16,
2013—the day Plaintiff sustained the injuries by Defendant Motyka—through November
1, 2021—the day the Court will enter judgment in this action. 2 At 3% compounded
annually, the total prejudgment interest on Plaintiff’s economic damages is $38,856.00. 3
For the reasons set forth above, Plaintiff’s Motion for Prejudgment Interest (ECF
No. 335) is GRANTED IN PART AND DENIED IN PART.
Plaintiff only requested prejudgment interest through the date of the jury’s verdict. (See
ECF No. 335 at 12.) However, the Court will award prejudgment interest through November 1,
2021, the date that judgment will be entered.
The Court’s calculation regarding prejudgment interest is set forth below:
1/16/2013 – 1/15/2014
1/16/2014 – 1/15/2015
1/16/2015 – 1/15/2016
1/16/2016 – 1/15/2017
1/16/2017 – 1/15/2018
1/16/2018 – 1/15/2019
1/16/2019 – 1/15/2020
1/16/2020 – 1/15/2021
1/16/2021 – 11/1/2021
3% x (290 days /
$ 165,749.26 365 days in a year)
Total Prejudgment Interest
Dated this 1st day of November, 2021.
BY THE COURT:
William J. Martinez
United States District Judge
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?