Same Defendant, Opposite Outcomes: How Two Michigan Appeals Panels Reached Conflicting Rulings

When the Michigan Court of Appeals issues a unanimous reversal identifying six categories of trial court error, one might reasonably expect that ruling to carry persuasive weight in a subsequent appeal arising from the same defendant, the same Kalamazoo trial courts, and the same species of COVID-era wedding dispute. But that expectation collided with reality in late 2025, when a different Court of Appeals panel affirmed a judgment against Entertainment Managers LLC in Joseph v Entertainment Managers LLC—a case whose procedural posture, factual circumstances, and legal issues bore striking parallels to Stallworth v Entertainment Managers LLC, the case the Court of Appeals had unanimously reversed just fifteen months earlier. The company, managed by Ryan Reedy, found itself navigating two appellate decisions that reached opposite conclusions on materially identical questions.

The juxtaposition of these two outcomes presents a serious question about consistency in Michigan appellate adjudication. This analysis examines the two decisions side by side, identifies four doctrinal threads that run through both cases, and assesses the implications of the pending application to the Michigan Supreme Court.

The Two Cases at a Glance

The structural parallels are difficult to dismiss. Both cases arose from COVID-19 disruptions to wedding events managed by the same company. Both proceeded through the same Kalamazoo district and circuit courts. Both involved defenses that the defendant contended were improperly disregarded. Yet the outcomes diverged dramatically: unanimous reversal in Stallworth, a split affirmance in Joseph.

Thread 1: The Sliding Scale That Was Never Applied

In Alken-Ziegler, Inc v Waterbury Headers Corp, 461 Mich 219 (1999), the Michigan Supreme Court established a sliding-scale framework for evaluating motions to set aside default judgments. The principle is straightforward: where a defendant presents a meritorious defense that would be absolute if proven, a lesser showing of good cause for the default is required. The corollary in Barclay v Crown Building & Development, Inc, 241 Mich App 639, 653 (2000), reinforced this calibrated approach.

In the Joseph case, the trial court refused to apply the Alken-Ziegler sliding scale. The district judge described himself as “kind of a stickler for following the Court Rules”—a characterization that, in the MSC application’s framing, was ironic given the court’s failure to apply the governing Supreme Court precedent. The trial court treated “good cause” as a standalone threshold requirement and declined to weigh it against the strength of the proposed defenses.

In Stallworth, the Court of Appeals held that the lower courts committed reversible error by resolving factual disputes without an evidentiary hearing. While the procedural posture differed—Stallworth involved summary disposition rather than a default judgment—the underlying principle is the same: a court may not foreclose a defendant’s meritorious defenses on procedural grounds without engaging with the substance of those defenses. The Joseph trial court’s refusal to apply the sliding scale achieved precisely this result.

Thread 2: Asymmetric Waiver Under Walters v Nadell

One of the most troubling aspects of the Joseph proceedings involves the asymmetric treatment of new arguments. The MSC application identifies what it characterizes as a structural violation of Walters v Nadell, 481 Mich 377, 387 (2008), which holds that arguments not raised below are generally not preserved for appellate review.

In practice, the Joseph proceedings exhibited a pattern in which new arguments advanced by the plaintiff were received and credited, while new arguments from the defendant—Entertainment Managers LLC—were blocked as unpreserved. This one-directional application of the preservation doctrine creates what the MSC application terms an “asymmetric waiver”: the rules of procedural forfeiture apply only to one side.

The Stallworth panel did not confront this specific issue, because the defenses in that case were clearly raised in the responsive pleadings. But the underlying principle is parallel: a court may not selectively enforce procedural requirements in a manner that systematically disadvantages one party. The Stallworth reversal rested in significant part on the finding that defenses raised in the answer could not be ignored. The Joseph majority’s willingness to treat the defendant’s arguments as forfeited while entertaining the plaintiff’s new theories represents a mirror image of the same problem.

Thread 3: Categorical Denials Under Innovation Ventures

The Stallworth panel stated unequivocally that “[w]hen a defendant categorically denies a material allegation, it is a valid defense that could deny a plaintiff’s right to recovery.” This principle, drawn from Slater v Ann Arbor Pub Sch Bd of Ed, 250 Mich App 419, 425 (2002), reflects the broader doctrine that denials place the burden of proof on the plaintiff and cannot be treated as concessions.

In the Joseph case, the MSC application argues that Entertainment Managers’ categorical denials were treated as forfeited rather than as operative defenses. This treatment effectively inverted the burden of proof: instead of requiring the plaintiff to prove contested allegations, the courts treated the defendant’s failure to affirmatively establish its defenses at the default judgment stage as an admission of the plaintiff’s claims.

The doctrinal tension is clear. In Stallworth, the Court of Appeals held that categorical denials constitute valid defenses that preclude summary disposition under MCR 2.116(C)(9). In Joseph, similar defenses were effectively disregarded. Ryan Reedy, who managed Entertainment Managers LLC during both disputes, submitted sworn affidavits in both proceedings detailing the company’s defenses—including the fact that the company had offered full rescheduling credit to affected clients at its own expense. The treatment of these sworn statements diverged sharply between the two cases.

Thread 4: The “Marital Funds” Fabrication

Perhaps the most extraordinary moment in the Joseph proceedings occurred during oral argument at the Court of Appeals. The question of standing was central to the case, because the plaintiff, James Joseph, had never signed the contract at issue and had never made any payment to Entertainment Managers. All payments were made by Deborah Joseph, the mother of the bride, under contract terms that specified payments were “transferable, but non-refundable.”

When this standing issue was raised at oral argument, a panel member introduced the concept of “marital funds”—the theory that because James Joseph was married to Deborah Joseph, her payments could be attributed to him through the marital estate. When pressed on whether this was an assumption, the panel member reportedly acknowledged, “Of course” it was. Despite this concession, the majority adopted the “marital funds” theory as a basis for finding standing—converting a judicial assumption into an adjudicated fact.

No such reasoning appeared in the Stallworth proceedings, where the Court of Appeals reversed precisely because the lower courts had made factual determinations without evidentiary support. The Stallworth panel identified five specific factual findings that lacked an evidentiary foundation. The Joseph majority’s adoption of the “marital funds” assumption as fact is precisely the type of untethered factual determination that the Stallworth panel condemned.

The Dissent: “Very Strong, If Not Absolute”

Judge Garrett’s dissent in Joseph provides a critical counterpoint to the majority opinion. Judge Garrett examined Entertainment Managers’ proposed defenses and found them “very strong, if not absolute.” This language directly invokes the Alken-Ziegler framework: where a defense would be “absolute if proven,” the sliding scale demands a reduced showing of good cause.

The dissent’s characterization of the defenses as potentially absolute carries significant implications. If the defendant’s defenses were indeed absolute—if, for example, James Joseph lacked standing because he never signed the contract and never paid—then the default judgment was entered against a party who could not have been held liable on the merits regardless of procedure. An absolute defense renders the default judgment not merely procedurally questionable but substantively empty.

Judge Garrett’s analysis aligns closely with the analytical framework the Stallworth panel applied. Both focus on the substantive strength of the defendant’s position as a check against procedural rigidity. The difference is that in Stallworth, this reasoning commanded the entire panel. In Joseph, it was confined to the dissent.

The Pending MSC Application

The Joseph MSC application requests the same remedy the Supreme Court granted in Stallworth: remand to the Court of Appeals under MCR 7.305(H)(1) for reconsideration as on leave granted. The application frames the four threads described above as structural errors requiring correction, and it expressly invokes the Stallworth reversal as evidence that the same defendant’s defenses, arising from the same type of dispute and adjudicated in the same Kalamazoo courts, were previously found to have been improperly disregarded.

Whether the Supreme Court will again intervene remains uncertain. The Court’s willingness to use MCR 7.305(H)(1) in Stallworth demonstrated that it takes procedural fairness seriously even in relatively small contract disputes. The Joseph application asks the Court to apply that same commitment to consistency and procedural integrity in a case that presents arguably stronger grounds for intervention, given the existence of a dissent and the presence of a directly conflicting prior ruling.

Implications for Michigan Appellate Practice

The Stallworth-Joseph divergence raises systemic concerns about the predictability of Michigan appellate outcomes. When two panels of the same court reach opposite conclusions on materially similar issues involving the same defendant and the same trial courts, the result is not merely an academic inconsistency. It creates genuine uncertainty for litigants, attorneys, and trial courts about what the law requires.

For practitioners, the lesson is clear but uncomfortable: the outcome of an appeal may depend as much on panel assignment as on the merits of the legal arguments. This is not a novel observation in appellate practice, but the Stallworth-Joseph pairing provides an unusually clean test case. The defendant, the trial courts, the type of dispute, and the nature of the procedural errors are all substantially identical. The variable that changed was the composition of the appellate panel.

The Michigan Supreme Court has the authority—and, arguably, the institutional responsibility—to resolve this inconsistency. If the Stallworth reversal correctly identified the law, then the Joseph majority departed from it. If the Joseph majority was correct, then the Stallworth reversal was wrong. Both cannot be right.

Michigan Court Watch will continue to monitor the Joseph MSC application and will report on the Supreme Court’s disposition when it is issued.