                            In the
 United States Court of Appeals
              For the Seventh Circuit
                         ____________

No. 05-4004
BLUE CROSS AND BLUE SHIELD ASSOCIATION,
                                            Plaintiff-Appellant,
                               v.

AMERICAN EXPRESS COMPANY,
                                            Defendant-Appellee.
                         ____________
       Appeal from the United States District Court for the
         Northern District of Illinois, Eastern Division.
         No. 99 C 6679—Matthew F. Kennelly, Judge.
                         ____________
 ARGUED SEPTEMBER 22, 2006—DECIDED OCTOBER 30, 2006
                   ____________


  Before EASTERBROOK, KANNE, and SYKES, Circuit Judges.
   EASTERBROOK, Circuit Judge. For many years, American
Express has offered credit cards in the color of money.
When it added a blue card during the 1990s, trademark
litigation erupted. The Blue Cross and Blue Shield Associa-
tion uses a blue card (with a registered “Blue Card” service
mark) for its insurance and related health-care products; it
maintained that American Express’s blue card would be
confused with its offerings. A settlement was reached in
2000: American Express acknowledged the Association’s
senior rights in the term “Blue Card” and promised not to
use the word “Blue” in connection with any health-care or
insurance products. It also promised not to refer to its
2                                                No. 05-4004

customers as “Blue cardholders”; the Association agreed
that in promotional materials American Express could use
“Blue credit cardholder” or a similar expression as long as
a word separates “Blue” from “card”. Paragraph 5 of the
agreement, now the bone of contention, reads in full:
“American Express shall not use the word ‘Blue’ on its
credit cards.”
   The settlement provided that the Association would
dismiss its suit with prejudice but that “the District Court
will retain jurisdiction to enforce this Agreement in the
event of an allegation of its breach.” A provision of this sort
logically implies entry of a consent decree, for the settle-
ment contemplates long-term undertakings. Instead,
however, the court dismissed the suit and asserted a
right to enforce the settlement. The only pertinent language
is: “This court shall retain jurisdiction over this matter for
purposes of enforcing the terms of the settlement agree-
ment.”
   The district court did not set out those terms, so the order
did not serve as an injunction under Fed. R. Civ. P. 65(d).
Thus when the Association contended that in 2004 Ameri-
can Express reneged on its promise by issuing a blue credit
card prominently emblazoned “Blue Cash”, American
Express denied that the district court’s declaration of intent
to retain jurisdiction had any effect. Relying on Kokkonen
v. Guardian Life Insurance Co., 511 U.S. 375 (1994),
American Express maintained that a district court may
retain jurisdiction only by incorporating the settlement into
a judgment. See Lynch v. SamataMason, Inc., 279 F.3d 487,
489 (7th Cir. 2002) (dictum to the effect that incorporation
is essential); Engle v. Foley & Lardner, LLP, No. 05-4096
(7th Cir. Sept. 11, 2006), slip op. 4 (same); but see Hill v.
Baxter HealthCare Corp., 405 F.3d 572, 577 (7th Cir. 2005)
(dictum to the effect that a bare declaration of intent to
retain jurisdiction suffices).
No. 05-4004                                                   3

   The district judge sought to secure its jurisdiction by
amending the judgment. Although the time for revision
under Fed. R. Civ. P. 60(b) had long passed, and the sort of
arguments the Association advanced would not have
justified resort to Rule 60(b) anyway, see Gonzalez v.
Crosby, 125 S. Ct. 2641, 2650-51 (2005), a clerical error may
be corrected at any time under Fed. R. Civ. P. 60(a). The
judge declared the 2000 order’s failure to incorporate the
settlement’s terms to have been a “clerical error” and
purported to “correct” that error by entering a new judg-
ment reading in full: “Nunc pro tunc 5/23/2000, the stipu-
lated motion for dismissal with prejudice, pursuant to
FRCP 41(a)(1), and with each party bearing its own costs
and attorney’s fees is granted. The parties are directed to
comply with the terms of the settlement agreement, which
is hereby incorporated into the judgment. The Court shall
retain jurisdiction for the purpose of enforcing the terms of
the settlement agreement.” See 225 F.R.D. 230, 233 (N.D.
Ill. 2004).
  Neither the district judge nor the parties paid any
attention to the fact that the revised judgment, which is a
form of injunction (the parties are “directed to comply”), still
does not satisfy Rule 65(d), which provides (among other
things): “Every order granting an injunction . . . shall be
specific in terms; shall describe in reasonable detail, and
not by reference to the complaint or other document, the act
or acts sought to be restrained” (emphasis added). Nor does
the amended order satisfy Lynch. If the 2000 order’s failure
to spell out the enforceable terms is a jurisdictional defect,
the 2004 order is no better. But Kokkonen and Lynch were
not the main hurdles; Rule 65(d) was. It is an old rule, easy
to understand and easy to follow; that it should be ignored
repeatedly by both the judge and counsel in large-stakes
commercial litigation is unfathomable. See Dupuy v.
Samuels, No. 06-1027 (7th Cir. Oct. 3, 2006), slip op. 2-5.
Disdain for this simple requirement, compliance with which
4                                                No. 05-4004

would have made the continuation of federal jurisdiction
clear, has led to years of complex, costly, and wasteful
maneuvering.
  As soon as the district court amended the judgment in
2004, American Express filed a notice of appeal, which
was docketed as No. 04-4251. It insisted that Rule 60(a)
does not authorize a change in the 2000 judgment—which,
far from being a “clerical error,” used precisely the language
that the district judge had instructed the clerk to employ.
There may have been a legal miscue—the Association and
the district judge failed to appreciate Kokkonen’s signifi-
cance—but Rule 60(a) cannot be used to change language
that was poorly chosen, as opposed to incorrectly tran-
scribed. See United States v. Griffin, 782 F.2d 1393, 1396-97
(7th Cir. 1986). The past cannot be rewritten; Rule 60(a)
allows a court to correct records to show what was done,
rather than change them to reflect what should have been
done. The Association nonetheless defended the district
court’s decision and asked us to dismiss the appeal for lack
of jurisdiction, contending that it was interlocutory (the
only point of the amendment was to set up a hearing on the
Association’s motion for enforcement) and, if not interlocu-
tory, that the time to appeal had expired in 2000.
  While the parties prepared and filed the normal set of
appellate briefs, plus supplemental jurisdictional memo-
randa at the court’s direction, the district court pro-
ceeded with the hearing. Once again both the district
court and the parties seemed oblivious to an important
procedural rule: A notice of appeal deprives the district
court of jurisdiction over the issues presented on the appeal.
See, e.g., Griggs v. Provident Consumer Discount Co., 459
U.S. 56 (1982). There is an exception for frivolous interlocu-
tory appeals, see Apostol v. Gallion, 870 F.2d 1335 (7th Cir.
1989), but to use this exception the district judge must
certify that the appeal is frivolous and allow the aggrieved
party time to seek a stay from the appellate court. The
No. 05-4004                                                 5

Association, which had contended that the appeal was
outside our jurisdiction, did not avail itself of this proce-
dure. At the conclusion of an evidentiary hearing the
district court found (a) that American Express had not
violated ¶5 of the agreement, and (b) that relief would be
barred by laches even if a violation had been established.
2005 U.S. Dist. LEXIS 20733 (N.D. Ill. Sept. 6, 2005).
   At this point the parties nimbly switched positions in
No. 04-4251, then only a few days away from oral argument
(so that three judges already had invested substantial work
on the appeal). American Express proposed to dismiss its
appeal in order to reap the benefit of victory in the district
court—for if we were to accept its argument that the district
court lacked subject-matter jurisdiction, the decision would
be vacated and the parties would have to start over in state
court. For its part, the Association, which had supported the
Rule 60(a) order, now cast about for ways to restart the
litigation. Because the Association did not agree to the
dismissal—though it asked for attorneys’ fees on the theory
that the appeal had been frivolous—this court was entitled
to impose conditions. Fed. R. App. P. 42(b). To ensure that
the parties did not adopt inconsistent positions before a new
panel assigned to the second appeal (which the Association
was sure to file) we conditioned dismissal of the first appeal
on the parties’ undertaking to address in the second appeal
a series of jurisdictional questions.
  By the time the Association’s appeal (No. 05-4004) had
been briefed, this court began to wonder what the fight had
been about. When the parties are citizens of the same state,
or the stakes are less than $75,000, then only an exercise of
the supplemental jurisdiction allows federal litigation to
enforce a financial settlement of a case under the federal-
question jurisdiction (as the Association’s trademark suit
was). The parties and the district court had devoted sub-
stantial energy to the question whether their disagreement
about the “Blue Cash” logo may be resolved under the
6                                                No. 05-4004

supplemental jurisdiction. Yet the stakes substantially
exceed $75,000, and a check of public records led this court
to conclude that the parties are of diverse citizenship—as
indeed the Association’s complaint had alleged.
  So the court directed the parties to file post-argument
memoranda addressing still more jurisdictional questions,
including the availability of jurisdiction under 28 U.S.C.
§1332. The parties agree that complete diversity exists.
American Express insists that the Association had to file a
fresh suit under the diversity jurisdiction, but we can’t see
why. Kokkonen is about adjudicatory competence, not the
number of filing fees a plaintiff must pay. As long as §1332
supplies authority to decide, the court may act without a
fresh complaint. Indeed, if the settlement had been entered
as a consent decree, as it should have been, the original
federal-question jurisdiction would have sufficed. Parties
need not file independent litigation to obtain the benefit of
an injunction. Gobs of judicial (and law-firm) time have
been squandered by the combination of sloppy drafting,
repeated violations of Rule 65(d), and inattention to all
sources of subject-matter jurisdiction. If these lawyers were
physicians, their patients would be dead.
  Next in line is the question whether the district court
could act while American Express’s appeal was pending.
The norm (an old one of which Griggs is just a recent
exemplar) that only one court at a time has authority in
a case is designed to avoid wasteful duplication of effort and
to avert the prospect that the appeal may make the district
court’s proceedings pointless, or the reverse. The district
court’s decision made appeal No. 04-4251 pointless.
  Still, one established exception to the rule against
simultaneous exercise of jurisdiction is that the district
court may enforce its judgment while an appeal to test that
judgment’s validity proceeds. See, e.g., Union Oil Co. of
California v. Leavell, 220 F.3d 562, 565 (7th Cir. 2000).
No. 05-4004                                                 7

Despite the fact that no formal judgment set out the parties’
obligations, the order of 2000 and the amended order of
2004 demonstrated the district judge’s willingness to treat
the settlement as a consent decree. The proceedings to
“enforce” that settlement were in the nature of a petition to
hold American Express in civil contempt of court. Because
a stay had been neither sought nor issued sua sponte, the
district court was entitled to enforce its disposition even
though American Express was simultaneously attempting
to have it vacated on appeal. Compliance with Rule 65(d)
would have made this clear; noncompliance did not dimin-
ish the district court’s jurisdiction to hold a hearing and
make a decision (though it may well have prevented the
district judge from holding American Express in contempt).
Holding the hearing when it did may have been imprudent,
but the district court did not act ultra vires.
  Because the district court rejected the Association’s
argument that American Express has violated ¶5 of the
settlement, we need not decide whether the violation of
Rule 65(d) independently would have defeated the Associa-
tion’s motion. See D. Patrick, Inc. v. Ford Motor Co., 8 F.3d
455, 461 (7th Cir. 1993) (stating flatly that violations
of Rule 65(d) prevent enforcement of the purportedly
incorporated documents). (Dupuy questions how far the
approach of D. Patrick properly extends, and today is not
the occasion for final resolution.) Whether the Association
is entitled to prospective relief remains to be decided,
however.
  One of the district court’s two reasons for ruling against
the Association—that ¶5 bars only a standalone appearance
of the word “blue,” so that “Blue Cash” on a card is unaf-
fected by ¶5—is reviewed independently on appeal. Having
rebuffed (or held not credible) all parol evidence offered to
elucidate the meaning of that paragraph, the district court
based its decision on the agreement’s raw text. That is well;
the four-corners rule applies to the interpretation of consent
8                                               No. 05-4004

decrees. See United States v. ITT Continental Baking Co.,
420 U.S. 223 (1975); cf. Firefighters v. Stotts, 467 U.S. 561
(1984). This also means that a court of appeals may make
up its own mind, without deference to the district judge’s
interpretation.
 There is nothing ambiguous about the text: “American
Express shall not use the word ‘Blue’ on its credit cards.”
We conclude that ¶5 means what it says: American Express
must not put the word “blue” on any credit card. “Blue
Cash” includes the word “blue” and thus violates ¶5.
  Context supports the straightforward reading. Paragraph
3 provides that American Express “shall not apply to
register the terms ‘Blue’ alone or ‘Blue Card,’ as a trade or
service mark.” Paragraph 4 says that American Express
must not use “Blue cardholder” but that it may use “Blue
[word] cardholder” in promotion or advertising. Paragraph
6 says that American Express may not “use the term ‘Blue’
alone or in combination with any other term(s) to brand
or identify health care or insurance products or services.”
Thus when ¶5 says that “the word ‘Blue’ ” must not appear
on credit cards, the logical understanding is that the
word itself is banned; it can’t be redeemed by using the
word in a combination—whether “blue credit cardholder,”
which ¶4 allows in advertising but not on credit cards, or
“Blue Cash”, which American Express added to a new
version of its blue card in 2004.
  Contractual ambiguities should not be read to create one-
sided or unlikely business arrangements, see Beanstalk
Group, Inc. v. AM General Corp., 283 F.3d 856, 860 (7th Cir.
2002), but (a) ¶5 isn’t ambiguous, and (b) there is nothing
one-sided about the bargain of which ¶5 is a component.
The Association’s principal goal was to keep the word “blue”
off of a credit card—especially a blue card issued by a firm
that refers to its customers as “cardmembers”—to protect
its rights in the mark “Blue Card.” Allowing the word “blue”
No. 05-4004                                                9

to be printed on a blue card whenever some other word also
appears (which is how the district judge understood ¶5)
could lead to both dilution and confusion.
  Although the Blue Cross and Blue Shield Association
(often known as “The Blues”) is the senior proprietor of
the “Blue Card” mark, the settlement allows American
Express to use the color blue on a credit card and to employ
phrases such as “blue credit cardholder” and “Blue from
American Express” in promotional materials. Paragraphs 3
and 4 are favorable to American Express; paragraphs 5 and
6 favor the Association. It would not do businesses any
favors to destabilize compromises of this kind by bending
any one of the clauses in favor of a litigant that decides,
after the deal has been struck, that it yielded too much. In
the long run, everyone gains from predictability (and from
rules that reduce the expense of litigating about such
transactions).
  Actually American Express did not decide that it had
given away the store and seek relief so that it could get
back to business. Instead it filed the settlement away
and forgot about it; the phrase “Blue Cash” appeared not
because American Express suffered seller’s remorse, or
because it wanted to test the bounds of the agreement, but
because it paid no attention to its obligations. The people
who made the business decision to market a “Blue Cash”
card had no idea that American Express is obliged to limit
its use of the word “blue” on, or in connection with, its
credit-card business. Either they did not run the subject
past corporate counsel, or the lawyers had developed
amnesia. This makes problematic the district court’s second
ground of decision—one on which appellate review is
deferential, to be sure, see Hawxhurst v. Pettibone Corp., 40
F.3d 175, 181 (7th Cir. 1994), but on which we are not
satisfied that the district court’s discretion has been
soundly exercised.
10                                               No. 05-4004

  The district court held the Association’s protest barred by
laches because American Express’s blue card has displayed
“blue” on its reverse side all along, as part of the customer-
service phone number (1-888-blue-741). Because the
Association did not remonstrate in 2000 when American
Express failed to replace “blue” with numerals, it is
disentitled to relief in 2004 when American Express added
“Blue Cash” to the front of the card, the judge concluded.
Now it is not clear to us that “1-888-blue-741” is “the word
‘Blue’ ”. The phone number contains the letters b, l, u, and
e in order, but so do “bluebird” and “bluenose,” neither of
which is the word “blue.” Letters used mnemonically in a
phone number don’t cause confusion about origin.
   This is not, however, the Association’s theme. Instead of
arguing that printing “1-888-blue-741” on the card’s reverse
is proper under the settlement, and that it protested as soon
as American Express overstepped its rights, the Association
maintains that it relied on American Express to implement
the settlement and therefore did not need to examine the
cards between 2000 and 2004. That’s nothing short of an
assertion that litigants are entitled to sleep on their rights.
If they are, then the doctrine of laches is defunct. The
district court soundly rejected this line of argument. We
therefore take it as established that the Association has
tarried unjustifiably in attempting to enforce its rights.
  Still, unwarranted delay is not enough to foreclose
relief. There must also be prejudice—reliance, to one’s
detriment, on a belief that delay signaled approval of the
acts in question. See, e.g., Bennett v. Tucker, 827 F.2d 63, 69
(7th Cir. 1987); Rogers v. Barton, 386 Ill. 244, 253, 53
N.E.2d 862, 866 (1944). Yet American Express has not
argued that it assumed, from the Association’s quiescence,
that “1-888-blue-741” was proper under ¶5, that the
agreement therefore forbids only the word “Blue” standing
alone, and only then devoted resources to promoting its
“Blue Cash” program. That would indeed be detrimental
No. 05-4004                                               11

reliance, but it is not what occurred. The “Blue Cash” logo
and promotion were developed not in reliance on the Associa-
tion’s passivity, but in ignorance of the agreement’s exis-
tence. As far as we can see, everything would have pro-
ceeded exactly as it did in 2004 had a protest by
the Association in 2000 led American Express to replace “1-
888-blue-741” with “1-888-258-3741”. If that’s so, then there
is no reliance, detrimental or otherwise.
  There is one possible way to show reliance, at which the
district judge hinted. If the Association had alerted Ameri-
can Express in 2000 or 2001 to its view that the alphanu-
meric phone number violated the agreement, then perhaps
American Express would not have filed it away but would
instead have ensured that its legal department vetted the
“Blue Cash” slogan before new cards were issued. The judge
did not find, however, that this chain of “ifs” would have
come to pass. Nor did the court discuss whether, if such
attenuated causation and reliance can be established, delay
wipes out the Association’s rights, as opposed to limiting
enforcement to prospective relief. Further proceedings
therefore are essential.
  The judgment is vacated. On remand the district court
must promptly enter a consent decree that complies with
Rule 65(d) and then address the question of detrimental
reliance and the appropriate remedy, if necessary after a
further hearing.
12                                        No. 05-4004

A true Copy:
      Teste:

                    ________________________________
                    Clerk of the United States Court of
                      Appeals for the Seventh Circuit




               USCA-02-C-0072—10-30-06
