FILED
                                                           United States Court of Appeals
                                                                   Tenth Circuit

                                                                January 14, 2011
                                         PUBLISH              Elisabeth A. Shumaker
                                                                  Clerk of Court
                      UNITED STATES COURT OF APPEALS

                                  TENTH CIRCUIT


 REGIONAL AIR, INC.,

          Plaintiff - Appellant/Cross-
          Appellee,
 v.                                                Nos. 09-6090 and 09-6101

 CANAL INSURANCE COMPANY,

          Defendant - Appellee/Cross-
          Appellant.


                    Appeal from the United States District Court
                       for the Western District of Oklahoma
                            (D.C. No. 5:08-CV-00342-C)


Edward W. Dzialo, Jr., Godlove, Mayhall, Dzialo, Dutcher & Erwin, Lawton,
Oklahoma, for Plaintiff-Appellant/Cross-Appellee.

Harris A. Phillips (Linda G. Alexander, with him on the briefs), Niemeyer,
Alexander, Austin & Phillips, P.C., Oklahoma City, Oklahoma, for Defendant-
Appellee/Cross-Appellant.


Before KELLY and GORSUCH, Circuit Judges, and MELGREN *, District
Judge.


GORSUCH, Circuit Judge.



      *
         Honorable Eric F. Melgren, District Court Judge, District of Kansas,
sitting by designation.
       Sometimes litigation takes so many twists and turns that, by the end of it

all, it’s hard to tell who won and who lost. Ours is such a case. After much

motions practice and a trial, Canal paid Regional Air just less than $60,000 for an

insurance loss. After trial, both sides declared victory. And this led to a whole

new fight over who won and who lost the last fight. Claiming to be the

“prevailing party,” each side argued that Oklahoma law entitled it to recover

attorneys’ fees, costs and, in Regional Air’s case, interest from its opponent.

Eventually, the district court declared Regional Air the prevailing party but

granted the company only a fraction of the fees, costs, and interest it sought. This

result satisfied no one and both sides appealed. To resolve these competing

appeals, and hopefully bring this collateral dispute at least a step closer to

conclusion, we must address several questions of law, including: When should

relief granted before trial be included within the district court’s judgment? Does

a trial court have discretion to deny attorneys’ fees under Oklahoma’s law? When

does a prevailing party’s entitlement to pre-verdict interest accrue? As we will

explain, our resolution of these questions agrees in many but not all respects with

the district court’s.




                                          -2-
                                           I

      To make sense of the parties’ current collateral litigation over attorneys’

fees, costs, and interest, some appreciation of their underlying insurance dispute

is required.

      Beginning then at the beginning, Canal sold Regional Air an insurance

policy to cover several of Regional Air’s tractor trailers. For our purposes, the

policy contained three important features. First, “[i]n the event of [a] loss,” it

required Regional Air to “protect the covered automobile”; and to ensure this

would be done, Canal’s policy indicated that “reasonable expenses incurred in

affording such protection shall be deemed incurred at [Canal’s] request.” App.

Vol. 2 at 200. Second, the policy required Regional Air to give notice of any loss

“as soon as practicable” to Canal or its agents. Id. Third, in the event of a

dispute about the value of a loss, the policy gave both parties the option to insist

on an appraisal process before a neutral umpire. Id. at 201.

      In June 2001, a loss occurred when a traffic accident damaged one