Stone Group Holdings LLC v. Todd Ellison

The summaries of the Colorado Court of Appeals published opinions
constitute no part of the opinion of the division but have been prepared by
the division for the convenience of the reader. The summaries may not be
cited or relied upon as they are not the official language of the division.
Any discrepancy between the language in the summary and in the opinion
should be resolved in favor of the language in the opinion.

SUMMARY
January 25, 2024

2024COA10

No. 23CA0004, Stone Group Holdings v Ellison — Remedies —
Damages — Interest on Damages — Prejudgment Interest;
Appeals — Final Appealable Order

Answering a question left unresolved in Grand County Custom

Homebuilding, LLC v. Bell, 148 P.3d 398 (Colo. App. 2006), a

division of the court of appeals holds that an order granting

prejudgment interest is reduced to a sum certain and is therefore

final and appealable when the amount is calculable on the face of

the order. Prejudgment interest is facially calculable when the

order states (1) the amount of the judgment; (2) the prejudgment

interest rate; and (3) the date when the interest began accruing.
COLORADO COURT OF APPEALS 2024COA10

Court of Appeals No. 23CA0004
Boulder County District Court No. 21CV30567
Honorable Dea M. Lindsey, Judge

Stone Group Holdings LLC, a Colorado limited liability company,

Plaintiff-Appellee,

v.

Todd Ellison and MC2 Boulder LLC, d/b/a Marquis Cannabis, a Colorado
limited liability company,

Defendants-Appellants

and

D.J. Marcus

Attorney-Appellant.

APPEAL DISMISSED

Division IV
Opinion by JUDGE GROVE
Navarro and Lum, JJ., concur

Announced January 25, 2024

Gard Law Firm, L.L.C., Jeffrey S. Gard, Austin Q. Hiatt, Boulder, Colorado, for
Plaintiff-Appellee

Ogborn Mihm, LLP, D.J. Marcus, Denver, Colorado, for Defendants-Appellants
and Attorney-Appellant
¶1 In this dispute over a failed investment in a marijuana

business, defendants, Todd Ellison and MC2 Boulder LLC, d/b/a

Marquis Cannabis (MC2), and their attorney, D.J. Marcus, appeal

three separate district court orders that (1) granted summary

judgment to plaintiff, Stone Group Holdings LLC, on its breach of

contract claim; (2) awarded attorney fees based on fee-shifting

language in that contract; and (3) sanctioned Ellison, MC2, and

Marcus for failing to disclose certain information during discovery.

We conclude that the notice of appeal was untimely and therefore

dismiss the appeal for lack of jurisdiction.

I. Background

¶2 MC2 was a licensed marijuana business whose principals,

Ellison and Ryan Quinn, agreed to sell two-thirds of their company

to Stone Group. Under the terms of the parties’ contract, which

was executed on April 24, 2020, Ellison and Quinn were to apply

for a change of ownership once they received Stone Group’s

payment of $175,000. Stone Group wired that amount four days

after the parties signed the contract, but no transfer of ownership

ever occurred.

1
¶3 Six months later, Stone Group filed a complaint alleging

breach of contract against Ellison and Quinn and unjust

enrichment against all three defendants. Quinn never responded to

the complaint, and the district court entered a default judgment

against him. Stone Group then moved for summary judgment

against Ellison and MC2 on its unjust enrichment claim. They did

not respond to the motion, so on April 11, 2022, the district court

granted it and ordered Ellison and MC2 to pay Stone Group

“$175,000 plus statutory interest, with interest commencing on

April 24, 2020.”

¶4 Shortly thereafter, Stone Group filed a second motion for

partial summary judgment, this time on the breach of contract

claim. The motion sought to compel all three defendants to follow

through on the contractual term that required them to transfer two-

thirds of the company to Stone Group.

¶5 While this motion was pending, Stone Group learned that,

several months earlier, MC2 had missed the deadline for renewal of

its marijuana license, rendering the company valueless once its

prior license expired. Stone Group sought sanctions against

2
Ellison, MC2, and its attorney (Marcus) for failing to disclose this

development in discovery.

¶6 On May 18, 2022, the district court granted the motion for

partial summary judgment but declined to award specific

performance or other contractual damages because it found that

“rescission of the [c]ontract essentially occurred” when, in the first

partial summary judgment order, it ordered the return of the

$175,000 that Stone Group had paid. However, relying on the

contract’s fee-shifting provision, the court awarded Stone Group its

attorney fees stemming from the litigation of the contract claim and

instructed Stone Group to submit an affidavit in support of its fee

request within fourteen days.

¶7 On May 26, 2022, the court granted Stone Group’s motion for

discovery sanctions and awarded it attorney fees from the time that

the defendants knew the late licensure application had been denied

to the date of the order — a period of approximately four months.

The court again instructed Stone Group to submit an affidavit

reflecting its attorney fees incurred during that period and, on June

8, 2022, clarified that the sanctions were imposed jointly and

severally against Ellison, MC2, and Marcus.

3
¶8 Also on June 8, 2022, the parties filed a stipulated motion for

dismissal of the defendants’ counterclaims and requested that the

trial be vacated. The district court granted the motion the same

day.

¶9 In an order issued on June 21, 2022, the court “award[ed]

attorney fees in favor of [p]laintiff and against [Ellison and MC2] in

the amount of $16,000.00 related to the prosecution of the breach

of contract claim.” The order made no reference to prejudgment or

postjudgment interest.

¶ 10 Litigation over the attorney fee award and the proper amount

of sanctions continued. After a hearing, the court ordered the

following on October 11, 2022:

 “[Ellison, MC2, and Marcus] shall pay Plaintiff $16,000 in

damages related to Plaintiff’s litigation of their breach of

contract claim.” Importantly, the court’s June 21 order

applying the fee-shifting provision of the contract had

only awarded fees against Ellison and MC2. We are

unable to discern from the record why the October 11

order added the defendants’ counsel to the fee award

arising from the breach of contract claim.

4
 “[Ellison, MC2, and Marcus] shall pay Plaintiff $6,000 in

damages [as a discovery sanction] related to [the]

violation of C.R.C.P. Rules 11 and 26.”

 “The Court reiterates its finding in its June 8, 2022 order

that sanctions are imposed jointly and severally against

[Ellison, MC2,] and their counsel.”

¶ 11 Shortly thereafter, Stone Group filed a motion requesting that

“final judgment be entered in the present matter.” (In its reply brief,

Stone Group explained that it filed the motion “so that plaintiff

could begin the collections process.”) Stone Group requested the

entry of judgment in the following amounts:

 $215,033.65 owed jointly and severally by Ellison and

MC2 on the unjust enrichment claim, which appears to

be comprised of the $175,000 judgment and accrued

interest, plus a previous discovery sanction of $2,629.65

and accompanying interest on that amount;

 $16,441.86 owed jointly and severally by Ellison, MC2,

and Marcus on the attorney fee award under the

contract, comprised of the $16,000 judgment plus

accrued interest; and

5
 $6,000 owed jointly and severally by Ellison, MC2, and

Marcus for discovery sanctions.

¶ 12 On November 15, 2022, the court granted Stone Group’s

motion by signing the proposed order that had been submitted

together with the motion.

¶ 13 Ellison, MC2, and Marcus filed their notice of appeal on

January 3, 2023 — forty-nine days after the order issued on

November 15, 2022.

II. Timeliness

¶ 14 Although Ellison, MC2, and Marcus seek appellate review of

three different and separately appealable judgments — the merits

ruling on Stone Group’s breach of contract claim, the attorney fee

award arising from the contract’s fee-shifting provision, and the

$6,000 discovery sanction — they filed only a single notice of appeal

forty-nine days after the district court ostensibly entered “final

judgment” on those claims. As we explain below, however, the

court’s order entering “final judgment” was superfluous because

each of these issues had already been fully and finally resolved

weeks or months earlier.

6
A. Standard of Review and Principles of Law

¶ 15 Before reaching the merits of an appeal, we must first

determine whether we have jurisdiction. Atherton v. Brohl, 2015

COA 59, ¶¶ 7-8. Considering the question de novo, McDonald v.

Zions First Nat’l Bank, N.A., 2015 COA 29, ¶ 33, we conclude that

we do not have jurisdiction over any aspect of this appeal because it

was not timely filed.

¶ 16 Appellate jurisdiction is limited by several rules, two of which

are relevant to our analysis. First, a final judgment or order is a

prerequisite to appellate review. § 13-4-102(1), C.R.S. 2023; C.A.R.

1(a)(1); L.H.M. Corp., TCD v. Martinez, 2021 CO 78, ¶ 14. Second,

the notice of appeal must be timely; here, the applicable rule

required filing “within 49 days after entry of the judgment, decree,

or order being appealed.” C.A.R. 4(a)(1).1

1 This deadline can be extended by a timely filed C.R.C.P. 59

motion. See Amada Fam. Ltd. P’ship v. Pomeroy, 2021 COA 73,
¶ 73. In addition, C.A.R. 4(a)(4) provides, “Upon a showing of
excusable neglect, the appellate court may extend the time to file
the notice of appeal for a period not to exceed 35 days after the time
prescribed by [C.A.R. 4(a)].” The defendants do not assert
excusable neglect but instead argue only that their notice of appeal
was timely.

7
¶ 17 Our jurisdiction over this appeal hinges on when the three

orders at issue — the order on the second partial summary

judgment motion, the order awarding fees under the fee-shifting

provision in the contract, and the sanctions award — became final.

“‘[A]s a general rule, a judgment is final and therefore appealable if

it disposes of the entire litigation on its merits, leaving nothing for

the court to do but execute the judgment.’” L.H.M. Corp., ¶ 14

(citation omitted). But a final judgment need not necessarily be the

last order that a court enters. Indeed, courts frequently issue

postjudgment administrative or ministerial orders; so long as they

do not “affect[] rights or create[] liabilities not previously resolved by

the adjudication of the merits,” Luster v. Brinkman, 250 P.3d 664,

667 (Colo. App. 2010) (citation omitted), they do not affect finality of

the judgment. See, e.g., Bainbridge, Inc. v. Douglas Cnty. Sch. Dist.

RE-1, 973 P.2d 684, 686 (Colo. App. 1998) (holding that an order

adding mandatory postjudgment interest was unnecessary and did

not affect or alter the underlying judgment).

¶ 18 To be considered final, a judgment or order must address both

liability and damages, Chavez v. Chavez, 2020 COA 70, ¶ 28, and

damages must be reduced to a sum certain. See, e.g., Grand Cnty.

8
Custom Homebuilding, LLC v. Bell, 148 P.3d 398, 400-01 (Colo. App.

2006). Prejudgment interest is a component of a damages award

and must also be “reduced to a sum certain” before an order is

considered final. Id. at 401.

B. Relevant Orders

¶ 19 We must consider six separate orders to determine whether

this appeal is timely:

 the April 11, 2022, order granting partial summary

judgment to Stone Group on the unjust enrichment claim

and awarding it “$175,000 plus statutory interest, with

interest commencing on April 24, 2020”;

 the May 18, 2022, order granting partial summary

judgment to Stone Group on the contract claim and

ruling that Stone Group was entitled to attorney fees

under the contract’s fee-shifting provision;

 the June 8, 2022, order granting the stipulated motion

for dismissal of the defendants’ counterclaims and

vacating the trial;

9
 the June 21, 2022, order awarding $16,000 in attorney

fees to Stone Group, to be paid by Ellison and MC2,

under the contract’s fee-shifting provision;

 the October 11, 2022, order that

o reiterated that Stone Group was entitled to $16,000

in fees under the fee-shifting provision but ruled

that Ellison, MC2, and Marcus were jointly and

severally liable for that amount; and

o sanctioned Ellison, MC2, and Marcus, jointly and

severally, in the amount of $6,000 for discovery

violations; and

 the November 15, 2022, order of final judgment that

calculated accrued interest on, and added that interest

to, the unjust enrichment and attorney fee awards, and

also reiterated the $6,000 discovery sanction.

C. Analysis

1. Merits Ruling

¶ 20 Ellison and MC2 contend that the district court incorrectly

granted summary judgment against them on the breach of contract

claim because Stone Group elected an unjust enrichment remedy

10
and, by prevailing on that equitable claim, made contractual

remedies unavailable. Because Ellison and MC2 did not file a

timely appeal, however, we lack jurisdiction to review the court’s

grant of summary judgment.

a. April 11 Partial Summary Judgment Order

¶ 21 We acknowledge that the April 11 partial summary judgment

order adjudicating the unjust enrichment claim is not discussed

extensively in the parties’ briefs. Nonetheless, we address it first

because it pertains to our jurisdiction. See People v. S.X.G., 2012

CO 5, ¶ 9.

¶ 22 Standing on its own, the April 11 order was not final because,

as a partial summary judgment order, it did not dispose of the

entire litigation on the merits. See L.H.M. Corp., ¶ 14. But given

the subsequent procedural history of this case, the order’s award of

prejudgment interest dating back to April 24, 2020, is nonetheless

central to our analysis.

¶ 23 In Bell, a division of this court considered whether

prejudgment interest is a component of damages. It concluded that

it is, and, turning to the impact of that holding on finality, the

division held that “a judgment awarding prejudgment interest is not

11
final until the amount of such interest is reduced to a sum certain.”

Bell, 148 P.3d at 401. The division then considered the meaning of

“sum certain,” observing that “some courts in other jurisdictions

have held that where a sum certain can be calculated from the face

of the judgment, it is final for purposes of appeal.” Id. The opinion

did not reach that question, however, because under the

circumstances of the case, “the amount of prejudgment interest

[was] not so easily calculable from the face of the . . . judgment.” Id.

at 402.

¶ 24 As best we can tell, every jurisdiction that has considered this

question has concluded that prejudgment interest is reduced to a

sum certain when the interest can be calculated from the face of the

order through purely ministerial or mechanical means. For

example, in Herzog Contracting Corp. v. McGowen Corp., 976 F.2d

1062, 1064 (7th Cir. 1992), the Seventh Circuit held that a

judgment was final because the parties knew the interest rate and

both the start and end date of interest accrual based on the

controlling contractual provision. In a similar case arising under

West Virginia law, the Fourth Circuit held that an order was final

and a party’s motion to clarify the amount of prejudgment interest

12
was not a motion to amend judgment because the amount of

prejudgment interest was of a “ministerial nature” and was “fixed at

the time of the entry of judgment” because the parties knew (1) that

interest had been awarded; (2) the statutory interest rate; and

(3) the timeframe for the computation. Kosnoski v. Howley, 33 F.3d

376, 379 (4th Cir. 1994). The Fifth and Eleventh Circuits have

endorsed similar approaches. See U.S. Sec. & Exch. Comm’n v.

Carrillo, 325 F.3d 1268, 1272 (11th Cir. 2003) (“[I]f the judgment

amount, the prejudgment interest rate, and the date from which

prejudgment interest accrues have been established . . . the court’s

failure to calculate the precise amount of prejudgment interest does

not prevent the court’s order from constituting a final

judgment . . . .”); Heck v. Triche, 775 F.3d 265, 277 (5th Cir. 2014)

(citing Carrillo with approval); cf. Halo Elecs., Inc. v. Pulse Elecs.,

Inc., 857 F.3d 1347, 1351 (Fed. Cir. 2017) (dismissing an appeal for

lack of finality because “[t]he district court never resolved the

parties’ dispute regarding the date from which to begin calculating

prejudgment interest or set the amount of prejudgment interest to

be awarded” to the prevailing party).

13
¶ 25 For three reasons, we agree with the approach taken in these

cases. First, it is implicit in the analysis of Luster, 250 P.3d at 666,

which concluded that once an order exists from which prejudgment

interest is facially calculable, any subsequent order stating the

lump sum owed does not affect the substantive rights of either

party and is thus ministerial. Instead, it is a matter of simple

arithmetic — rendering the act of announcing the lump sum a

ministerial act akin to that of announcing the lump sum of

mandatory postjudgment interest. See Bainbridge, 973 P.2d at 686.

Second, it promotes judicial economy by removing an unnecessary

step of judicial involvement. Third, it allows the prevailing party to

begin the collection process earlier.

¶ 26 Therefore, addressing the question that the Bell division left

unresolved, we hold that, if an order announces (1) the amount of

the judgment; (2) the interest rate; and (3) the date on which

accrual of prejudgment interest begins, then the amount of

prejudgment interest has been reduced to a sum certain as of the

date of the order. Applying that test here, we conclude that the

April 11 order reduced prejudgment interest on the unjust

enrichment claim to a sum certain because it stated (1) the amount

14
of the judgment; (2) the interest rate; and (3) the date on which

accrual began. Once final judgment was entered on June 8, the

amount was easily calculable.

¶ 27 It follows that the April 11 order would have been immediately

appealable had it resolved all of the issues in the case. It did not,

however, because it only granted partial summary judgment to

Stone Group. But importantly, because prejudgment interest could

be calculated from the face of the April 11 order, it did not prevent

the judgment from becoming final once the remaining issues were

resolved. Thus, as we explain next, once the district court granted

summary judgment on Stone Group’s breach of contract claim and

the counterclaims were dismissed, the judgment was final

notwithstanding the court’s subsequent October 11 and November

15 orders reiterating the award and declaring the exact amount of

prejudgment interest.

b. May 18 Partial Summary Judgment Order and Stipulated
Dismissal of Counterclaims

¶ 28 On May 18, 2022, the district court granted Stone Group’s

second motion for partial summary judgment. The court ruled that

Ellison and MC2 had breached the contract but declined to order

15
specific performance or grant money damages under the contract

because it found “that for the purposes of further damages,

rescission of the [c]ontract essentially occurred” when it granted

summary judgment on Stone Group’s unjust enrichment claim.

¶ 29 Although this order resolved the merits of Stone Group’s

claims, it was not final because it did not resolve the counterclaims

raised by Ellison and MC2. Once those counterclaims were

dismissed pursuant to the parties’ stipulation on June 8, 2022, the

merits judgment was final, and any appeal was due within forty-

nine days of that date. (The fact that the court had determined that

Stone Group was also entitled to attorney fees under the contract

had no impact on the finality of the merits ruling. See L.H.M. Corp.,

¶ 23 (“[A] judgment on the merits is final and appealable

notwithstanding an unresolved issue of attorney fees.”).) But

Ellison and MC2 did not file their appeal until January 3, 2023. It

is therefore untimely, and we do not have jurisdiction to review the

merits judgment.

2. Attorney Fees

¶ 30 In a related argument, Ellison, MC2, and Marcus contend that

the court erred by granting attorney fees pursuant to the fee-

16
shifting provision of the contract because the contract was

effectively rescinded by the court’s order granting Stone Group’s

claim for unjust enrichment. We conclude that the appeal of this

order was also untimely.

¶ 31 “[A]n award of attorney fees is distinct and separately

appealable from the judgment on the merits.” Kennedy v. Gillam

Dev. Corp., 80 P.3d 927, 929 (Colo. App. 2003). That remains true

whether a fee award is denominated as costs or damages. L.H.M.

Corp., ¶¶ 25-28.

¶ 32 In its May 18 order granting Stone Group’s second motion for

partial summary judgment, the court found that Stone Group was

entitled to attorney fees under the fee-shifting language in the

contract, and on June 21, 2022, the court reduced that order to a

sum certain by awarding $16,000 in attorney fees to Stone Group,

to be paid by Ellison and MC2. Then, in the October 11 order, the

court added Marcus to this $16,000 award, stating that he was

jointly and severally liable for that amount along with Ellison and

MC2.

¶ 33 Ellison, MC2, and Marcus contend that the court erred by

awarding attorney fees under the fee-shifting provision of the

17
contract because it had already effectively declared the contract

rescinded when it granted Stone Group’s motion for summary

judgment on its unjust enrichment claim. If it were timely, this

argument would have some force. See Kennedy, 80 P.3d at 930-31

(“Once [the plaintiffs] elected the remedy of rescission and it was

granted by the court, the option of obtaining the benefits of a

provision in the rescinded contract was no longer available to

them.”). But we do not have jurisdiction to review it because

Ellison and MC2 did not appeal it within forty-nine days of when it

became final on June 21, 2022. Instead, the notice of appeal was

filed on January 3, 2023.

¶ 34 Because the June 21 order reduced the attorney fee award to

a sum certain, the court’s subsequent orders restating that amount

and adding interest to it were superfluous and did not change the

date that it became final. See Bainbridge, 973 P.2d at 686 (“[A]

judgment creditor who falls within the coverage of a mandatory

post-judgment interest statute need not obtain an additional

judgment (or a modification of a previous judgment) specifying that

entitlement.”).

18
¶ 35 That said, we acknowledge that the October 11 order appears

to have sua sponte added Marcus as a judgment debtor on the

$16,000 attorney fee award. We have been unable to find any

explanation for this apparent amendment to the judgment in the

record, and we observe that, under C.R.C.P. 59(c)(4), the district

court had only fourteen days after June 21, 2022, to order an

amendment of its judgment on its own initiative. See Koch v. Dist.

Ct., 948 P.2d 4, 7-8 (Colo. 1997) (“C.R.C.P. 59(c) allows the court to

order a new trial sua sponte. However, the court must act within

the time allowed the parties because at the end of this period, the

district court no longer has jurisdiction to grant post-trial relief

under C.R.C.P. 59.”) (footnote omitted). Nonetheless, even if the

district court had lost jurisdiction to amend its judgment to add

Marcus to the fee award by the time it issued its October 11 order,

we cannot review that aspect of the court’s judgment on appeal

because Marcus did not appeal it within forty-nine days of that

date.

3. Sanctions Order

¶ 36 Finally, we consider the timeliness of the appeal of the

sanctions order.

19
¶ 37 The October 11 order announced sanctions in the amount of

$6,000. Because the order was reduced to a sum certain on that

date, the court’s November 15 order entering “final judgment” was

superfluous. Ellison, MC2, and Marcus filed their notice of appeal

more than forty-nine days later, on January 3, 2023. Their appeal

was therefore untimely, and we lack jurisdiction over it.

¶ 38 In summary, the merits ruling was final on June 8, 2022. The

attorney fee award was final as to Ellison and MC2 on June 21,

2022, and as to Marcus on October 11, 2022. And the sanctions

award was final on October 11, 2022. Each of these three orders

was separately appealable, and each appeal had to be filed within

forty-nine days of the date that the underlying order became final.

Because none of the appeals was filed before its respective deadline,

we lack jurisdiction to consider them on the merits and must

dismiss the appeal.

III. Appellate Attorney Fees

¶ 39 Stone Group requests an award of appellate attorney fees,

arguing that the appeal is frivolous because we lack jurisdiction or,

in the alternative, that the fee-shifting provision of the contract

20
requires the losing party to cover the prevailing party’s attorney fees

on appeal. We decline to award fees.

¶ 40 An appeal is frivolous as filed if “there are no legitimately

appealable issues because the judgment below ‘was so plainly

correct and the legal authority contrary to the appellant’s position

so clear.’” Calvert v. Mayberry, 2019 CO 23, ¶ 45 (citation omitted).

Likewise, an appeal is frivolous as argued if a party commits

misconduct in the course of arguing the appeal. Castillo v. Koppes-

Conway, 148 P.3d 289, 292 (Colo. App. 2006).

¶ 41 It appears that both parties misunderstood finality in this

case, as demonstrated by Stone Group’s unnecessary request for

the court to enter “final judgment” well after each of the appealed

orders had become final. Given this procedural history, we cannot

conclude that the late appeal was frivolous. Likewise, Stone Group

does not allege any misconduct during the appellate proceedings, so

the appeal is not frivolous as argued.

¶ 42 We also decline to award appellate attorney fees to Stone

Group based on the contract’s fee-shifting provision. See Kennedy,

80 P.3d at 930-31. Stone Group elected to pursue an unjust

enrichment claim, and after it prevailed on that claim, the district

21
court found that “for the purposes of further damages, rescission of

the [c]ontract essentially occurred.” Once the contract was

rescinded, Stone Group was no longer able to receive the benefit of

the fee-shifting provision. See id. Accordingly, we deny Stone

Group’s request for appellate attorney fees.

IV. Disposition

¶ 43 We dismiss the appeal and deny the request for appellate

attorney fees.

JUDGE NAVARRO and JUDGE LUM concur.

22