restrictive practices and monopoly power. Although activities such as price-fixing still came under attack, other kinds of business cooperation flourished and even received offi- cial encouragement during the early years of the NEW DEAL. This pattern lasted for a good 15 years, intensifying after the STOCK MARKET crash of 1929. Following what historians called the era of neglect, antitrust made a resurgence. In 1935 the U.S. Supreme Court struck down President Franklin D. Roosevelt’s National Industrial Recovery Act, which coordinated industry-wide output and pricing, in ALA Schechter Poultry Corp. v. United States, 295 U.S. 495, 55 S. Ct. 837, 79 L. Ed. 1570. The decision radically affected New Deal–era policy. The fo llowing year, Con- gress passed the Robinson-Patman Act in an attempt to make sense of the Clayton Act’s bans on price discrimination. The Robinson-Patman Act explicitly forbade forms of price discrimina- tion, in order to protect small producers from extinction at the hands of larger competitors. By 1937, economic decline brought federal antitrust enforcement back with a vengeance, as Roose- velt’s administration began an extensive investi- gation into monopolies. The effort resulted in more than 80 antitrust suits in 1940 alone. One federal court case in this period, United States v. Aluminum Co. of America, 148 F.2d 416 (2d Cir. 1945) (Alcoa), changed antimonopoly law for years to come. Since the 1920s, the U.S. Supreme Court had looked skeptically on the role of a business’s size in judging monopoly cases. In United States v. United States Steel Corp., 251 U.S. 417, 40 S. Ct. 293, 64 L. Ed. 343 (1920), it said, “[T]he law does not make mere size an offense, or the existence of unexerted power an offense. It, we repeat, requires overt acts.” The decision weakened the monopoly ban of the Sherman Act. Rather than focus on abusive business conduct, Alcoa emphasized the role of market power. Judge Learned Hand wrote for the Court: “Many people believe that possession of unchallenged economic power deadens initiative, discourages thrift and depresses energy; that immunity from competition is a narcotic, and rivalry is a stimulant, to industrial progress; that the spur of constant stress is necessary to counteract an inevitable disposition to let well enough alone.” The standard that emerged from this decision applied a two-part test for determining illegal monopolization: The DEFENDANT (1) must possess monopoly power in a relevant market; and (2) must have improperly used exclusionary acts to gain or protect that power. Congress added its last piece of important legislation in 1950 with the Celler-Kefauver Antimerger Act, addressing a weakness in the Clayton Act. Because only anticompetitive stock purchases had been forbidden, businesses would circumvent the Clayton Act by targeting the assets of their rivals. U.S. Supreme Court decisions had also undermined the law by allowing businesses to transfer stock purchases into assets before the government filed a complaint. The Celler-Kefauver amendment closed these loopholes. The U.S. Supreme Court and Evolving Doctrine Vigorous enforcement of antitrust legislation created an immense bo dy of CASE LAW. After 1950, U.S. Supreme Court decisions did more than anything else to shape antitrust doctrine. Two competing outlooks emerged. One regarded markets as fragile, easily distorted by private firms, and readily correctable through public interven- tion. E conomic efficiency mat tered less, in this view, th an the belief in the antitrust doctrine’s ability to meet social andpolitical goals. Opponents saw business rivalry as being generally healthy. They doubted that public intervention could cure defects, and they emphasized the self-correcting ability o f markets to erode private restraints and private power. This outlook opposed the use of antitrust measures except to stop behavior that clearly harms the e fficien cy of bu siness . The most aggressive doctrine was developed under Chief Justice EARL WARREN. The WARREN COURT often saw the need for decentralized social, political, and economic power, a goal that it put ahead of the ideal of economic efficiency. In 1962, its first ruling on the Celler-Kefauver Act, Brown Shoe Co. v. United States, 370 U.S. 294, 82 S. Ct. 1502, 8 L. Ed. 2d 510, held that a merger between two firms that accounted for only 5 percent of total industry output violated the principal antimerger provision of the antitrust laws. Brown Shoe also reflected the Court’s hostility toward vertical restraints (i.e., restric- tions imposed in contracts by the seller on the buyer, or VICE versa) at that time. This aggressive approach peaked in 1967 in United States v. Arnold, Schwinn & Co., 388 U.S. 365, 87 S. Ct. 1856, 18 L. Ed. 2d 1249. Arnold GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 318 ANTITRUST LAW concerned nonprice vertical restraints (i.e., terri- torial or customer restrictions on the resale of goods). The majority ruled that such restraints were per se illegal, in other words, so harmful to competition that they need not be evaluated. In ensuing years, respected antitrust experts, such as Chief Judge RICHARD POSNER of the U.S. Court of Appeals for the 7th Circuit, criticized the Court’s use of “ per se” tests to invalidate vertical price agreements between competitors or be- tween sellers and buyers, arguing that such agreements can be efficient. The U.S. Supreme Court heeded this criticism in State Oil Co. v. Khan, 522 U.S. 3, 118 S. Ct. 275, 139 L. Ed. 2d 199 (U.S. 1997). Relying heavily on an appellate opinion penned by Judge Posner, the high co urt overruled a 29- year-old precedent that declared all vertical maximum price-fixing arrangements to be per se violations of the Sherman Act. Vertical maximum price-fixing arrangements, like the majority of commercial arrangements that are subject to antitrust laws, should be evaluated under the rule of reason, the Court wrote. The rule-of-reason analysis will effectively identify those situations in which vertical maximum price-fixing amounts to anticompetitive con- duct, by allowing courts to evaluate a variety of factors, according to the Court. These factors include specific information about the relevant business; the condition of the business before and after the restraint was imposed; and the history, nature, and effect of the restraint. By the mid 1970s the U.S. Court backed off its robust interventionism. Two pivotal decisions came in 1977, including the most important since WORLD WAR II, Continental TV v. GTE Sylvania, 433 U.S. 36, 97 S. Ct. 2549, 53 L. Ed. 2d 568. In a decisive departure from the previous decade’s rulings, the Court abandoned its hostility toward efficiency. Now, for evaluating nonprice vertical restraints, it returned to the use of a rule of reason. Per se rules would remain influential, but economic analysis would be the primary tool in formulating and applying antitrust rules. The second powerful change in doctrine was Brunswick Corp. v. Pueblo Bowl-O- Mat, 429 U.S. 477, 97 S. Ct. 690, 50 L. Ed. 2d 701. In the Brunswick decision, the Court wrote that antitrust laws “were enacted for the ‘protection of competition, not competitors.’” The irony was addressed to private antitrust litigants. If they wanted to SUE, the Court wrote, they would have to prove “antitrust injury.” This decision dis- carded the old view that the demise of individual firms was plainly bad for competition. Replacing it was the view that adverse effects to businesses are sometimes offset by gains in reduced costs and increased output. Increasingly, after Bruns- wick, the U.S. Supre me Court and lower courts accepted economic efficien cy as a justification for dominant firms to defend their market positions. By 1986 efficiency-based analysis was widely accepted in federal courts. Even against this restrictive background, explosive change occurred. The early 1980s saw the dramatic conclusion of a historic monopoly case against the telephone giant American Telephone and Telegraph (AT&T) (United States v. American Telephone & Telegraph Co., 552 F. Supp. 131 [D.D.C. 1982], aff’d in Maryland v. United States, 460 U.S. 1001, 103 S. Ct. 1240, 75 L. Ed. 2d 472 [1983]). DOJ settled claims that AT&T had impeded competition in long-distance telephone service and telecommunications equipment. The result was the largest divestiture in history: A federal court severed the Bell System’s operating companie s and manufactur- ing arm (Western Electric) from AT&T, thus transforming the nation’s telephone services. But the historic settlement was an exception to the political philosophy and the level of enforcement that characterized the decade. As the 1980s were ending, the DOJ dropped its 13-year suit against International Business Machines (IBM). This lengthy battle had sought to end IBM’s domi- nance by breaking it up into four computer companies. Convinced that market forces had done the work for them, prosecutors gave up. Throughout the 1980s, political conservatism in federal enforcement complemented the U.S. Supreme Court’s doctrine of non-intervention. The administration of President RONALD REAGAN reduced the budgets of the FTC and the DOJ, leaving them with limited resources for enforce- ment. Enforcement efforts followed a restrictive agenda of prosecuting cases of output restrictions and large mergers of a horizontal nature (i.e., those involving firms within the same industry and at the same level of production). Mergers of companies into conglomerates, by contrast, were looked on favorably, and the years 1984 and 1985 produced the greatest increase in corporate acquisitions in the nation’s history. As the U.S. Supreme Court strengthened requirements for evidence, injury, and the right GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION ANTITRUST LAW 319 to bring suit, antitrust cases became harder for plaintiffs to win. Most decisions during this period narrowed the reach of antitrust. A few rare exceptions, such as Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585, 105 S. Ct. 2847, 86 L. Ed. 2d 467 (1985), which condemned a monopolist’s unjustified refusal to deal with a rival, faintly recalled the tough outlook of the Warren Court. Non-intervention, however, took precedence. In the strongest example, Matsushita Electrical Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986), the majority dismissed allegations that Japanese television manufacturers had engaged in a 20-year pricing conspiracy that was designed to drive U.S. electronics equipment manufacturers out of business. The Court discouraged claims that rested on ambiguous CIRCUMSTANTIAL EVIDENCE or lacked “economic rationality,” suggesting that lower courts settle these by SUMMARY JUDGMENT. Litigation since the 1980s Once again proving that antitrust law never remains static, the late 1980s and early 1990s brought more changes in enforcement, eco- nomic analysis, and court doctrine. At the state level in the late 1980s, governments attacked mergers and restraints. The U.S. Supreme Court gave these efforts support in California v. American Stores Co., 495 U.S. 271, 110 S. Ct. 1853, 109 L. Ed. 2d 240 (1990), upholding the ability of state governments to break up illegal mergers. Another trend came again from academia, where for years critics of the Chicago School had been re-evaluating its highly influ- ential efficiency model. They concluded that a proper analysis of efficiency goals showed that efficiency demanded tighter antitrust contro ls, not stubborn non-interven tion. An important 1992 U.S. Supreme Court case seemed to support this view. Eastman Kodak Co. v. Image Technical Services, 504 U.S. 451, 112 S. Ct. 2072, 119 L. Ed. 2d 265 (hereinafter Kodak), concerned tying arrange- ments (i.e., contracts between buyer and seller that restrict competition) in the sale and service of photocopiers. Kodak sold replacement parts only to buyers who agreed to have Kodak exclusively service the machines, and the restriction prompted a lawsuit from 18 inde- pendent service organizations (ISOs). The company defended itself by arguing that even if it did monopolize the market, it lacked the necessary market power for a Sherman Act violation. The Court rejected the idea that this was enough to create a legal rule that equipment competition precluded any finding of monopoly power in the parts and services industry. In declaring Kodak’s arrangement to be illegal, Justice HARRY A. BLACKMUN warned about the dangers of relying on economic theory as a substitute for “actual market realities”—in this case, the harm done to ISOs who were shut out of the service market. After the Reagan years, antitrust attitudes sharpened in Washington, D.C. The adminis- tration of President George H. W. Bush adopted a slightly more activist approach, which was reflected in joint guidelines on mergers, issued in 1992 by the FTC and DOJ. In following the trend away from strict Chicago School efficiency standards, the guidelines looked more closely at competitive effects and tightened requirements. But understaffed government attorneys generally lost court cases. President BILL CLINTON took this activism further. Anne K. Bingaman, his appoin- tee to head DOJ’s Antitrust Division, strength- ened the division’s staff with 61 new attorneys, declaring her organization to be the competition agency. The Antitrust Division filed 33 civil suits in 1994, roughly three times the annual number that had been brought under Reagan and Bush. It won some victories without going to court, in one instance compelling AT&T to keep a subsidiary private, but it lost a major lawsuit in which it had claimed that General Electric had conspired with the South African firm of DeBeers to fix industrial diamond prices. Congress continued to address monopolies in legislation passed during the 1990s. Congress passed the Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56, to increase competition within the telecommunications industry and to end state-sanctioned monopo- lies. The act required regional telephone compa- nies (known as the Baby Bells) to share their networks with a new generation of telecommu- nications companies. Dozens of new companies began as a result of the 1996 act, and disputes emerged. During the early 2000s, LITIGATION arose accusing a local exchange carrier, Verizon Communications, of violating the antitrust provisions of the Sherman Act. The Supreme Court, however, determined that these types of claims did not fall under the Sherman Act GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 320 ANTITRUST LAW (Verizon Communications, Inc v. Law Offices of Curtis V. Trinko, 540 U.S. 398, 124 S. Ct. 872, 157 L. Ed. 823 [2004]). Under President Clinton, the most impor- tant antitrust actions involved federal probes of the computer microprocessor giant Intel Cor- poration and the computer software giant Microsoft Corporation. In 1999 the FTC settled a year-old la wsuit against Intel by entering a CONSENT DECREE under which Intel agreed to cease retaliating against customers during INTELLECTUAL PROPERTY disputes over micropro- cessor technology. In its 1998 lawsuit, the FTC claimed that Intel had illegally cut off shipments of its microprocessor chips and withheld technical information regarding microproces- sors, to coerce its competitors (Intergraph Corp., the forme r Digital Equipment Corp., and Compaq Computer Corp., which acquired Digital in 1998) to give up their microprocessor technology. Intel did not dispute most of the facts underlying the allegations, but it insisted that it had acted legally. However, the Microsoft probe, in its poten- tial for far-reaching action, was the biggest antitrust case since those involving AT&T and IBM. Competitors complained that Microsoft had been using illegal arrangements with buyers to ensure that its Windows operating system would be installe d in nearly 80 percent of the world’s computers. In-depth investigations by the FTC and DOJ followed. In July 1994, under threat of a federal lawsuit, Microsoft entered a consent decree that was designed to increase competitors’ access to the market. The follow- ing year, Microsoft launched its popular Windows 95 operating system with an upgraded version of its INTERNET Explorer Web browser, two products that the software maker said were integrally related. Over the next two years, the federal govern- ment received fresh complaints that Microsoft was again resorting to anti-com petitive practices. The DOJ responded by suing Microsoft in the U.S. district court for the District of Columbia, alleging that the software maker had violated the 1994 consent decree by forcing computer makers to install its Internet Explorer Web browser as a pre-condition to the computer makers having the right to sell their PCs with the Windows 95 operating system included. Two months later U.S. District Judge Thomas Pen- field Jackson issued a PRELIMINARY INJUNCTION forcing Microsoft to stop, at least temporarily , requiring manufacturers who sell the Windows operating system to install Microsoft’s Internet Explorer, an arrangement that he called an illegal tying agreement (United States. v. Microsoft Corp., 980 F. Supp. 537 [D.D.C. 1997]). Fueled in part by Jackson’s ruling, the DOJ joined 20 state attorneys general in May 1998 to bring suit against Microsoft, charging that the software maker’s illegal bundling of Internet Explorer with Windows 95 violated federal antitrust laws and state unfair-competition statutes. The fol- lowing month, a three-judge panel for the U.S Court of Appeals for the District of Columbia overturned the preliminary injunction that Judge Jackso n had issued to enforce the consent decree, thus making way for the parties to resolve their dispute in the joint suit brought by DOJ and the state attorneys general (United States v. Microsoft Corp., 147 F.3d 935 [D.C. Cir. 1998]). On October 19, 1998, trial began in the antitrust suit against Microsoft. Less than a month later, Judge Jackson had issued a preliminary finding that Microsoft was exercis- ing illegal monopoly power in the operating- system market and that the software maker had been using that power to promote its Web browser and to stifle competition through illegal bundling of the two products (United States v. Microsoft Corp., 84 F.Supp.2d 9 [D.D.C. 1999]). Jackson issued his FINAL DECISION in April 2000. The judge reiterated his preliminary findings and also concluded that the same facts that demonstrated that Microsoft had unlawfully leveraged its operating-system monopoly to push rival Web browsers out of the market in violation of federal law also established Micro- soft’s liability under analogous state antitrust provisions (United States v. Microsoft Corp.,97 F. Supp. 2d 59 [D.D.C. 2000]). Later that month, the court proceeded to the remedy phase of the trial. DOJ and 18 state attorneys general (two attorneys general had since dropped out of the suit) asked the judge to break the company into two parts: one com- pany to develop and market the Windows operating system, and the other to develop Microsoft’s software, including its Web browser. On June 7, 2000, Judge Jackson granted the requested remedy, and Microsoft appealed. The court of appeals reversed, finding that Jackson had erroneously applied a per se analyses in making his findings instead of the appropriate GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION ANTITRUST LAW 321 “rule of reason” standard (United States v. Microsoft Corp., 253 F.3d 34 [D.C. Cir. 2001]). The appellate court then remanded the matter for further proceedings, but ordered Judge Jackson removed from the case after he made extra-judicial comments to the press in violation of ethical canons forbidding judges from com- menting on the merits of a pending case. Upon remand, Judge Colleen Kollar-Kotelly was se- lected to replace Jackson. In September 2001 the DOJ announced that it would no longer seek a breakup of Microsoft and agreed to commence negotiations to settle the lawsuit. Those negotiations bore fruit in October 2001, when the DOJ and nine states announced that they had reached a tentative settlement with Microsoft. Ultimately approved by Judge Kollar-Kotelly on November 1, 2002, the settlement prevents Microsoft from parti- cipating in exclusive deals that could hurt competitors; requires Microsoft to offer uni- form contract terms to PC makers; and obliges the so ftware giant to release some technical information so that software developers can write programs fo r Windows that work as well as Microsoft’s own products do. The settlement agreement also compels Microsoft to give manufacturers and customers a way to remove certain Micr osoft icons from the Windows desktop. In the court’s order approving the settlement, the judge expressly reserved the right to reopen the case herself if she ever suspects Microsoft of violating the settlement’s terms United States v. Microsoft, 231 F. Supp. 2d 144 [D.D.C. 2002]). To demonstrate its GOOD FAITH , Microsoft immediately unveiled several business and product changes to comply with the settlement, includin g Windows functionali- ty that gives users the ability to hide Microsoft programs like its Web browser and only see competing products. In the early 2000s the Supreme Court was called upon several times to review provisions of the federal antitrust statutes. For instance, in Leegin Creative Leather Products v. PSKS, 551 U.S. 877, 127 S. Ct. 2705, 168 L. Ed. 2d 623 (2007), the Court reviewed a case involving vertical price restraints. In 1911 the Court had reviewed these types of restraints and concluded that the restraints were per se violations of the Sherman Act (Dr. Miles Medical Co. v. John D. Park & Sons Co., 220 U.S. 373, 31 S. Ct. 376, 55 L. Ed. 502). In Leegin Creative Leather Products, the Court concluded that the rule of reason should govern these types of restraints. FURTHER READINGS American Bar Association, Section of Antitrust Law. 2008. State Antitrust Enforcement Handbook. 2d ed. Chicago: American Bar Association, Section of Antitrust Law. Dabbah, Maher M. 2003. The Internationalisation of Antitrust Policy. New York: Cambridge Univ. Press. Evans, David S., ed. 2002. Microsoft, Antitrust and the New Economy: Selected Essays. Boston: Kluwer Academic. Fundamentals of Antitrust Law (serial). New York: Aspen Law & Business. Hylton, Keith N. 2003. Antitrust Law: Economic Theory and Common Law. New York: Cambridge Univ. Press. Posner, Richard A. 2001. Antitrust Law. 2d ed. Chicago: Univ. of Chicago Press. CROSS REFERENCES Bork, Robert; Chicago School; Clayton Act; Corporations; Justice Department; Mergers and Acquisitions; Monopoly; Posner, Richard Allen; Restraint of Trade; Robinson- Patman Act; Sherman Anti-Trust Act; Unfair Competition. APPARENT That which is clear, plain, and evident. In the law of agency, an agent has apparent authority to represent the person, or principal, for whom he or she acts, when the principal acts in such a manner toward the agent that a REASONABLE PERSON would plainly assume that the agent was acting for the principal. APPEAL Timely resort by an unsuccessful party in a lawsuit or administrative proceeding to an appropriate superior court empowered to review a final decision on the ground that it was based upon an erroneous application of law. A person who initiates an appeal—the appellant, sometimes called the PLAINTIFF IN ERROR, must file a notice of appeal, along with the necessary documents, to commence appellate review. The person against whom the appeal is brought, the appellee, then files a brief in response to the appellant’s allegations. There are usually two stages of review in the federal court and in many state court systems: an appeal from a trial court to an intermediate appellate court and thereafter to the highest appellate court in the jurisdiction. Within the appellate rules of administrative procedure, there might be several levels of appeals from a determination made by an administrative agency. For example, an appeal of the decision of an GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 322 APPARENT administrative law judge may be heard by a reviewing body within the agency, and from that body, the appeal may go to a trial court, such as a federal district court. Thereafter, the appeal might travel the same route as an appeal taken from a judicial decision, going from an interme- diate to a superior appellate court, or it might go directly to a superior appellate court for review, bypassing the intermediate stage. The rules of appellate procedure applicable to a particular court govern its review of cases. Right to Appeal There is no absolute right of appeal for all decisions rendered by a lower court or admin- istrative agency. Federal and state constitutions and statutory provisions create appellate courts and prescribe the types of cases that are within their jurisdiction. An appeal may be granted as a matter of right, such as from a trial court to an intermediate appellate court or only at the discretion of a superior appellate court, for example, by a grant of CERTIORARI by the Supreme Court. If the decision presented does not meet the statutory requirements for review, the appellat e court is powerless to hear the appeal and review is denied. The right to appeal a decision is limited to those parties to the proceeding who are aggrieved by the decision because it has a direct and adverse effect upon their persons or property. In addi- tion, an actual CASE OR CONTROVERSY must exist at the time of review. Issues that have become MOOT while the appeal is pending and cases that have been settled during that time are not reviewable. Final Decision A final judgment or order must have been reached by the trial court in order for a case to be appealable. A judgment is considered final for purposes of appeal when it ends the action in the court in which it was brought and nothing more is to be decided. This rule is intended to prevent the piecemeal LITIGATION of a lawsuit, to avoid delay resulting from INTERLOCUTORY appeals, and to give the trial court the opportunity to render a decision in the case to the satisfaction of both parties, thereby obviating the need for appeal. The consideration of INCIDENTAL matters, such as the computation of interest, attorneys’ fees, or court costs, does not prevent a judgment or order from being appealed. Grounds Error is the basis for review of a FINAL DECISION rendered by a court or administrative agency. Error is called to the attention of a court through the use of objections, protests made during the course of a proceeding that an action taken by the opposing side in a controversy is unfair or illegal. Decisions rendered in favor of one party at trial level are presumed by an appellate court to be correct unless objections have been made to the issues in question during the trial. Failure to do so will preclude their review on appeal. An objection must be made as promptly and specifically as possible for each act to which it is directed so that the court may make an intelligent decision regarding its merits. The trial judge rules on the objection, and the decision is included in the trial record. If the attorney for either party disagrees with the ruling, he or she may take an exception, an objection taken to a decision of a court on a MATTER OF LAW, which is noted in the trial record to be preserved for purposes of appeal. Appel- late jurisdiction is limited only to a review of actions taken by an INFERIOR COURT. No new objections can be raised before an appellate Criminal Appeals from U.S. District Courts Filed in U.S. Court of Appeals, 1998 to 2007 SOURCE: U.S. Court of Appeals, 2007 Judicial Facts and Figures. 0 10,000 12,000 14,000 16,000 18,000 Number of appeals Year 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 13,167 15,246 16,060 12,506 11,968 11,569 11,281 10,707 10,251 10,535 ILLUSTRATION BY GGS CREATIVE RESOURCES. REPRODUCED BY PERMISSION OF GALE, A PART OF CENGAGE LEARNING. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION APPEAL 323 court for its consideration unless exceptional circumstances exist to justify the appellate court raising the issues SUA SPONTE, on its own motion. Exceptional circumstances mean the presence at trial of plain error, a mistake in the proceedings that substantially affects the rights of the party against whom the decision has been made and undermines the fairness and integrity of the judicial system, causing a MISCARRIAGE OF JUSTICE . Time of Appeal Appeals must be made within the time prescribed by statute or by the governing rules of the appellate court. Such statutes begin to run only after a final decision has been made. The timely filing of the notice of appeal with the clerk of the appellate court and the appellee completes, or perfects, the procedure. If the appeal is not taken and perfected within the time set by statute, the right to appeal is foreclosed. Extensions of time for the filing of an appeal may be granted, however, if EXTENU- ATING CIRCUMSTANCES exist, such as if either party is adjudicated incompetent or dies. Notice of Appeal A notice of appeal—a written document filed by the appellant with the court and a copy of which is sent to the appellee—is the initial step in the appeals process. It informs the court and the party in whose favor a judgment or order has been made that the unsuccessful party seeks a review of the case. Failure to file a notice of appeal according to the statutory requirements will preclude appeal. Bonds An appeal bond, a promise to pay a sum of money, must often be posted by an appellant to secure the appellee against the costs of the appeal, if the appellee is successful and the appellant fails to pay. Its amount is determined by the court itself or by statute. The imposition of such a bond discourages frivolous appeals. If successive appeals are taken from an intermedi- ate appellate court to a superior one, a new bond is usually req uired. Record on Appeal The function of the appellate court is limited to a review of the trial record sent up from the lower court and the briefs filed by the appellant and appellee. AMICUS CURIAE briefs, if permitted by the appellate court, also become part of the record on appeal. The trial record, sometime s called the record proper, must show the pleadings that initiated the case, the complete transcript (in cases of jury trial) of lower court proceedings, the VERDICT, and the ENTRY of the final judgment or order. The appellant must clearly demonstrate that the grounds for review had been raised and unsuccessfully decided upon at the trial level and, therefore, prejudicial error exists to warrant the reversal of the decision of the lower court. In some jurisdictions, a bill of exceptions—a written statement of the objections made by a party to the ruling, decision, charge, or opinion of the trial judge—must be subm itted to the appellate court to provide a history of the trial proceedings. It should not include matters that belong in the record proper but, instead, should state those points concerning questions of law raised by the exceptions taken during the trial. The appellant’s attorney prepares the bill and presents it to the trial judge for settlement, an agreement between the trial judge and the appellant that the bill contains a truthful account of the events of the trial. If there is disagreement, the judge returns the bill to the appellant with an explanation. The appellee must be given notice of the time and place of the settlement of the bill of exceptions in order to object to or approve its contents. The settled bill of exceptions becomes part of the trial transcript, which is part of the record on appeal. The appellant must submit a complete un- abridged transcript of the trial that is prepared by the clerk of the trial court. The entire trial record is printed and filed with the appellate court, and a copy is also sent to the appellee. Assignment of Errors A statement by the appellant of the errors alleged to have been committed in the lower court is an assignment of errors, a type of appellate PLEADING used to point out to the appellate court the grounds for review. It controls the scope of an appeal because if a ground for review is not contained in it, it will not ordinarily be considered by the court. The assignment of errors is usually part of the notice of appeal, the bill of exceptions, the transcript of the record, or the brief, although in some jurisdictions, it is a separate document. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 324 APPEAL Appellate Brief The appellant and appellee must file individual briefs to aid the appellat e court in its consider- ation of the issues presented. Failure to do so results in a dismissal of the appeal. The facts of the case, the grounds for review , and the arguments relating to those questions must be concisely stated. Any statements referring to the trial record must be supported by an appropri- ate reference to it. The appellant’s brief must specifically dis- cuss the alleged errors that entitle the appellant to a reversal and discuss why each ruling of the lower court was wrong, citing authority, such as a case in which a similar point of law has been decided or a statute that applies to the particular point in issue. Disrespectful or abusive language directed against the lower court, the appellate court, the parties, WITNESSES, or opposing counsel cannot be used. If it is, it will be stricken from the brief, and the costs of the brief that might have been awarded are disallowed. Review Appellate courts have jurisdiction to decide only issues actually before them on appeal and nothing else. They cannot render opinions on controversies or declare principles of law that have no practical effect in settling the rights of the litigants. Only conclusions of law, not findings of fact made by a lower court, are reviewable. Harmless Error The appellate court must decide whether the errors alleged to have been made by the trial court are harmless or prejudicial. An error that substantially injures the rights of one party is called a prejudicial or reversible error and warrants the reversal of the final judgment or order. However, an error that is technical or minimally affects the rights of the parties or the outcome of the lawsuit is considered a HARMLESS ERROR, insufficient to require a reversal or modification of the decision of the lower court. Hearing The clerk of the appellate court schedules on the court calendar the date of the hearing on which each side may present an oral argument. Oral arguments, usually ten to fifteen minutes for each side, help the court understand the issues argued in the brief and persuade the court to rule in favor of the arguing party. During the arguments of appellant and appellee, it is not unusual for the appellate judge to interrupt with questions on particular issues or points of law. The appellant’s argument briefly discusses the facts on which the CAUSE OF ACTION is based and traces the history of the case through the lower courts. It includes the legal issues raised by the exceptions taken to the allegedly errone- ous rulings of the trial judge. Thereafter, the appellee’s counsel presents arg uments in favor of affirming the original decision. Determination An appellate court has broad powers over the scope of its decision and the relief to be granted. After reviewing the controlling issues in an action, it may affirm the decision of the inferior tribunal, modify it, reverse it, or remand the case for a new trial in the lower court pursuant to its order. When a decision is affirmed, the appellate court accepts the decision of the lower court and rejects the appellant’s contention that it was erroneously made. The modification of a decision by an appellate court means that, while it accepts part of the trial court’s decision, the appellant was correct that the decision was partly erroneous. The trial court’s decision is then modified accordingly. A reversal of a decision means that the appellate court agrees with the appellant that the decision was erroneously made. The party who lost the case at the trial level becomes the winning party in appellate court. In some cases, a decision might be reversed but the lawsuit is still unresolved. The appellate court then orders the reversal with the direction that the case be remanded to a lower court for the determination of the issues that remain unsettled. If a judgment or order is reversed in an intermediate appellate court, the losing party may file an appeal with a superior appellate court for relief, and the appellate process begins again. The decision rendered by a superior appellate court cannot ordinarily be reviewed. In state cases involving issues based on federal statutes or the Constitution, however, an appeal may be brought in the federal court system on those questions that are within its jurisdiction. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION APPEAL 325 FURTHER READINGS Lynn, Richardson R. 1993. Appellate Litigation. 2d ed. Maryland: Austin & Winfield. Magen, Barbara S. 2003. “Let’s Twist Again: Getting Reargument and Reconsideration on Appeal.” Pennsyl- vania Law Weekly 26 (April). Wood, Jefri. 2002. Guideline Sentencing: An Outline of Appellate Case Law on Selected Issues. Washington, D.C.: Federal Judicial Center. CROSS REFERENCES Appellate Advocacy; Appellate Court; Federal Courts; Remand. APPEAR To come before a court as a party or a witness in a lawsuit. APPEARANCE A coming into court by a party to a suit, either in person or through an attorney, whether as plaintiff or defendant. The formal proceeding by which a defendant submits to the jurisdiction of the court. The voluntary submission to a court’s jurisdiction. In a criminal prosecution, an appearance is the initial court proceeding in which a DEFENDANT is first brought before a judge. The conduct of an appearance is governed by state and federal rules of CRIMINAL PROCEDURE. The rules vary from state to state, but they are generally consistent. During an appearance, the judge advises the defendant of the charges and of the defendant’s rights, considers bail or other conditions of release, and schedules a PRELIMINARY HEARING. If the crime charged is a MISDEMEANOR, the defendant may sometimes, depending on the local rules of court, enter a PLEA of guilty or not guilty at the initial appearance; if the crime is a FELONY, the defendant usually enters the plea at a later court proceeding. A criminal defendant may have an attorney present and may confer with the attorney during the appearance. In some situations, a defendant may not need to appear in court in person and may even make an appearance by mail. For example, when individuals receive traffic tickets they may choose to send in a check for the amount of the fine. Many state statutes permit appearances to be made by two-way, closed-circuit television. For instance, North Carolina’s rule on video appearances reads: A first appearance in a noncapital case may be conducted by an audio and video transmission between the judge and defendant in which the parties can see and hear each other. If the defendant has counsel, the defendant shall be allowed to communi- cate fully and confidentially with his attorney during the proceeding (N.C. Gen. Stat. § 15A-601(a1) [1994]). An appearance is also a coming into court as a party to a civil lawsuit. Although an appear- ance can be made by either the PLAINTIFF (the one who has sued) or the defendant (the one being sued), the term most often refers to the action of the defendant. The subject of appearance is closely related to the subject of PERSONAL JURISDICTION, which is the court’s authority over an individual party. An appearance is some OVERT ACT by which the defendant comes before the court to either submit to or challenge the court’s jurisdiction. Any party can appear either in person or through an attorney or a duly authorized representative; the party need not be physically present. In most instances, an attorney makes the appearance. An appearance can also be made by filing a notice of appearance with the clerk of the court and the plaintiff, which states that the defendant will either submit to the authority of the court or challenge its jurisdiction. In a lawsuit involving multiple defendants, an appearance by one is not an appearance for the others. Valid SERVICE OF PROCESS is not required before an appearance can be made. Historically, appearances have been classified with a variety of names indicating their manner or significance. A compulsory appearance is compelled by process served on the party. A conditional appearance is coupled with condi- tions as to its becoming or being taken as a GENERAL APPEARANCE (defined later in this article). A corporal appearance indicates that the person is physically present in court. A de bene esse (Latin, “of well being,” sufficient for the present) appearance is provisional and will remain good only upon a future contingency. A gratis (Latin, “free” or “freely”) appearance is made by a party to the action before the service of any process or legal notice to appear. An optional appearance is entered by a person who is intervening in the action to protect his or her own interests, though not joined as a party. A subsequent appearance is made by a defendant after an appearance has already been entered for him or her by the plaintiff. Finally, a voluntary appearance is entered by a party’s own will or consent, without GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 326 APPEAR service of process, although process might be outstanding. The two most common categories of appearances are general and special. General Appearance Any action by which the defendant recognizes the jurisdiction of the court constitutes a general appearance. This is an unqualified submission to the court’s personal jurisdiction over the defendant and is treated as the equivalent of a valid service of process. By making a genera l appearance, the defen- dant agrees that the court has the power to bind her or him by its actions and waives the right to raise any jurisdictional defects (e.g., by claiming that the service of process was improper). The defendant also waives the objection that the case is brought in the wrong VENUE. The defendant does not, however, WAIVE any substantive rights or defenses, such as the claim that the court lacks jurisdiction over the subject matter of the case or authority to hear the particular type of case (e.g., a BANKRUPTCY court will not hear PERSONAL INJURY cases). Special Appearance A SPECIAL APPEARANCE is one made for a limited purpose. It can be made, for example, to challenge the sufficiency of the service of process. But most often, a special appearance is made to challenge the court’s personal jurisdiction over the defendant. It prevents a DEFAULT JUDGMENT from being rendered against the defendant for failing to file a PLEADING.(A default judgment is an automatic loss for failing to answer the complaint properly.) When a defendant makes a special appear- ance, no other issues may be raised without that appearance’s becoming a general appearance. If a party takes any action dealing with the merits of the case, the party is deemed to have made a general appearance and submitted to the jurisdiction of the court. If a challenge is successful and the court agrees that it does not have personal jurisdiction over the defendant, it will dismiss the action. If the court finds against the defendant on that issue, that decision can later be appealed. The right to make a special appearance is almost universally recognized, except where abolished by statute. As a rule, leave of court (permission) must be obtained before a special appearance can be made, but this is not always the case. Federal Rules Federal courts and states that have adopted the Federal Rules of CIVIL PROCEDURE have eliminated the distinction between a general and a special appearance. Instead of challenging the court’s personal jurisdiction in a special appear ance, a defendant can do so by use of a pretrial motion to dismiss the CAUSE OF ACTION, or in an answer to the complaint. A removal proceeding, in which a defendant asks to have the case moved from state court to federal court, is regarded as a special appearance. Limited Appearance In a number of states, a defendant in a lawsuit based on QUASI IN REM JURISDICTION may make a limited appearance. Quasi in rem is a Latin phrase for a type of jurisdiction in which the court has power over the defendant’s property because it lies within the geographic boundaries of the court’s jurisdiction. The presence of the property gives the court jurisdiction over the person of the defendant. To invoke quasi in rem jurisdiction, the court must find some connection between the property and the subject matter of the lawsuit. A limited appearance enables a defendant to defend the action on the merits, but should the defendant lose, he or she will be held liable only up to the value of the identified property and not for all possible damages. A defendant who A defendant, accompanied by his court-appointed lawyer, appears before the judge in a Tacoma, Washington, courtroom. In a criminal prosecution, an appearance is the initial court proceeding in which the defendant is advised of the charges, bail is considered, and a preliminary hearing is set. AP IMAGES GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION APPEARANCE 327 . appeals Year 2007 2006 2005 2004 2003 2002 20 01 2000 19 99 19 98 13 ,16 7 15 ,246 16 ,060 12 ,506 11 ,968 11 ,569 11 ,2 81 10,707 10 ,2 51 10,535 ILLUSTRATION BY GGS CREATIVE RESOURCES. REPRODUCED BY PERMISSION OF GALE, A PART OF CENGAGE LEARNING. GALE ENCYCLOPEDIA. peaked in 19 67 in United States v. Arnold, Schwinn & Co., 388 U.S. 365, 87 S. Ct. 18 56, 18 L. Ed. 2d 12 49. Arnold GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 318 ANTITRUST LAW concerned. of Appeals, 19 98 to 2007 SOURCE: U.S. Court of Appeals, 2007 Judicial Facts and Figures. 0 10 ,000 12 ,000 14 ,000 16 ,000 18 ,000 Number of appeals Year 2007 2006 2005 2004 2003 2002 20 01 2000 19 99 19 98 13 ,16 7 15 ,246 16 ,060 12 ,506 11 ,968 11 ,569 11 ,2 81 10,707 10 ,2 51 10,535 ILLUSTRATION