A recent First Circuit decision adds to the list of circuits with inconsistent law on when subsequent events save a premature notice of appeal.
August 15, 2020
In Donahue v. Federal National Mortgage Association, the First Circuit held that the subsequent dismissal of a remaining defendant did not save a premature notice of appeal. The plaintiff in Donahue filed her notice after the district court had dismissed her claims against one of two defendants. So the notice of appeal was premature and technically ineffective. The plaintiff then voluntarily dismissed her claims against the other defendant. But she did not file a new notice of appeal. With no proper notice of appeal, the First Circuit concluded that it lacked jurisdiction.
The outcome would have been different in most courts. Indeed, until yesterday’s decision, I would have thought that the outcome would have been different in Donahue. The courts of appeals have split on when exactly subsequent events save a premature notices of appeal. And several circuits have internally inconsistent decisions. We can now add the First Circuit to that list. In at least two prior decisions, the First Circuit has held that the resolution of all outstanding claims saved a notice of appeal filed after some (but not all) of the claims had been resolved. I don’t see how Donahue can be reconciled with those decisions.
The cumulative-finality mess thus continues to build. Rehearing in Donahue might clean things up in the First Circuit. But the state of affairs across the circuits has gotten pretty bad. And the way most courts approach cumulative finality can deprive litigants of any chance at appellate review due to a relatively minor procedural mistake. It’s time for the Supreme Court or Rules Committee to fix things.
Cumulative Finality Generally
For in-depth background on cumulative finality, see my post The Federal Circuit & Cumulative Finality, my proposal to amend Federal Rule of Appellate Procedure 4(a)(2), or my law review article on the topic.
Briefly, cumulative-finality issues arise when litigants file premature notices of appeal. Notices normally must wait until the end of district court proceedings. But sometimes litigants file too early, before the district court has entered a judgment or other appealable decision. Problems can then arise if these litigants do not file a second notice (or amend their first). No technically proper notice of appeal has been filed. And parties that do not file a timely notice forfeit their right to appellate review.
To address this problem, courts and rulemakers developed the cumulative-finality doctrine, which allows subsequent events to save premature notices. Cumulative finality originally developed as a common law doctrine. It was then at least partially codified in Federal Rule of Appellate Procedure 4(a)(2). As amended, the rule now reads:
A notice of appeal filed after the court announces a decision or order—but before the entry of the judgment or order—is treated as filed on the date of and after the entry.
The Supreme Court has addressed Rule 4(a)(2)’s scope only once. In FirsTier Mortgage Co. v. Investors Mortgage Insurance Co., the Court held that Rule 4(a)(2) saved a notice of appeal filed after a district court had announced from the bench its decision to dismiss the case but before the court formally entered the final judgment of dismissal on the docket. The Court added that Rule 4(a)(2) would not save every premature notice of appeal. The rule instead “permits a notice of appeal from a nonfinal decision to operate as a notice of appeal from the final judgment only when a district court announces a decision that would be appealable if immediately followed by the entry of judgment.”
After FirsTier, the courts of appeals developed three general approaches to issues of cumulative finality. Some hold that subsequent entry of a judgment can save only notices filed after decisions resolving all outstanding issues in an action. Most courts hold that the subsequent entry of a judgment can save a premature notice if the order appealed from could have been certified for an immediate appeal under Federal Rule of Civil Procedure 54(b). And a few courts hold that a subsequent judgment can save nearly any district court decision, no matter how interlocutory.
This is no ordinary circuit split. Several courts of appeals have internally inconsistent decisions on when subsequent events can save a premature notice. With Donahue, the First Circuit is now one of them.
Cumulative Finality in Donahue
The Premature Appeal
Simplifying a bit, the dispute in Donahue arose from the foreclosure sale of the plaintiff’s home. The plaintiff sued two defendants, alleging that the sale violated state law. One of the defendants never filed an appearance. The other—the assignee of the defaulted mortgage—prevailed at summary judgment. The district court’s summary-judgment decision did not resolve the claims against the defendant that hadn’t appeared. The plaintiff nevertheless filed a notice of appeal, seeking review of the summary-judgment decision.
Before the parties had finished briefing the appeal, the First Circuit asked them to address its jurisdiction. In response, the plaintiff voluntarily dismissed her claims against the non-appearing defendant. The plaintiff then contended that the dismissal of this defendant cured any jurisdictional defects.
The First Circuit’s Refusal to Save the Notice of Appeal
The First Circuit disagreed. It began by noting that the dismissal of the non-appearing defendant was proper. Granted, a notice of appeal normally divests the district court of jurisdiction over all aspects of the case that are part of the appeal. But the notice of appeal in Donahue was premature and thus ineffective. So the district court still had the jurisdiction necessary for the voluntary dismissal.
The problem, according to the First Circuit, was that the plaintiff never filed a second notice of appeal after the voluntary dismissal. The notice of appeal she filed had to be ineffective for the voluntary dismissal to be proper. And she couldn’t have it both ways—that is, ignoring the notice for purposes of voluntarily dismissing the remaining defendant, but counting it for purposes of starting the appeal.
The First Circuit recognized that other courts have allowed the subsequent entry of a judgment to cure a premature notice. And it thought that “[t]he ripening logic these cases deploy has some appeal (no pun intended)”:
It saves an appellant from having to file an additional notice. It thereby both ensures that the finality rules do not become a trap for the unwary and obviates the need for starting an appeal over from scratch based on a technicality.
But the court thought it improper “to treat a notice of appeal in such a now-you-see-it, now-you-don’t, now-you-see-it-again way.” For one thing, the text of relevant provisions did not allow for saving premature notices:
The plain language of Rules 3 and 4 of the Federal Rules of Appellate Procedure as to when a notice of appeal must be filed—at least when read in conjunction with 28 U.S.C. § 1291—does not comfortably accommodate the conclusion that a notice of appeal filed following a non-appealable order may be treated as if it actually had been filed following an appealable order
For another, generally allowing premature notices to ripen “would render seemingly superfluous the existing, expressly limited exceptions in those two rules that allow for ripening in specified circumstances”: Rule 4(a)(2) (mentioned above) and Rule 4(a)(4), which saves a notice filed before the resolution of certain post-judgment motions. And all a litigant must do to avoid this trap, the court noted, was file a second notice of appeal.
An Additional Intra-Circuit Conflict
Donahue applies something close to the strictest approach to cumulative finality. At the very least, it refuses to allow a subsequent judgment to save a notice filed after a decision that could have been certified for an immediate appeal under Rule 54(b).
The thing is, the First Circuit has twice allowed a subsequent judgment to save this kind of notice.
Clausen v. Sea-3, Inc.
In 1994’s Clausen v. Sea-3, Inc., the First Circuit held that subsequent entry of a Rule 54(b) judgment saved a premature notice of appeal. The defendant in Clausen filed its notice of appeal after it had lost on the plaintiff’s claims but before the resolution of its third-party claims. While the appeal was pending, the district court entered a Rule 54(b) judgment on the plaintiff’s claims. But the defendant did not file a new notice of appeal.
The First Circuit nevertheless held that it had jurisdiction. It noted that most circuits hold that “a belated [Rule] 54(b) certification ripens a premature notice of appeal as of the date of the certification.” This holding, the court noted, was in the spirit of Rule 4(a)(2). And the resolution of the plaintiff’s claims would have been appealable if followed by a Rule 54(b) certification. So “by virtue of [Rule] 4(a)(2), [the defendant]’s premature notice of appeal ripened when the district court certified its . . . judgment pursuant to [Rule] 54(b).
Barrett ex rel. Barrett v. United States
Similarly, in 2006’s Barrett ex rel. Barrett v. United States, the First Circuit held that entry of a traditional final judgment saved a premature notice of appeal. The plaintiff in Barrett filed her notice of appeal after the district court had dismissed her claims against some—but not all—defendants. While the appeal was pending, the district court dismissed the claims against the remaining defendants and entered a final decision. But, like in defendant in Clausen, the plaintiff never filed a new notice of appeal.
The First Circuit again held that it had jurisdiction. Just like in Clausen, the district court’s dismissal of some claims would have been immediately appealable if followed by a Rule 54(b) certification. That the appeal was followed by a traditional judgment and not a Rule 54(b) judgment was of no consequence. The question appealability was a hypothetical one: would the decision have been appealable if certified? If it would have, the First Circuit required only that the district court enter “a final appealable judgment of some sort” before the court considered the appeal.
Irreconcilable Decisions
I can’t see any way to reconcile Donahue with Clausen and Barrett. The only actual difference is the manner in which the district court proceedings became final. In Donahue, the plaintiff ended district court proceedings by voluntarily dismissing its remaining claims. In Clausen and Barrett, the court ended proceedings by entering a judgment. The court never mentioned this difference (or Clausen or Barrett). And that difference shouldn’t matter. In both situations, the district court proceedings had become final before the appeal was decided. So the First Circuit now appears to have inconsistent caselaw on cumulative finality.
The Continuing Cumulative-Finality Problem
Donahue thus illustrates two aspects of the federal courts’ cumulative-finality problem.
First is the inconsistency itself. Like any circuit split, the courts disagree with each other. But the First Circuit isn’t alone in having inconsistent caselaw. Several other courts of appeals have issued inconsistent decisions on when subsequent events save a premature notice of appeal. One can find inconsistent decisions in the Third, Fifth, Ninth, Tenth, and Federal Circuits (the last of which only recently joined this club). So this is no ordinary circuit split.
Second are the consequences of how most courts approach cumulative finality. Left unsaid in Donahue is that the plaintiff might have lost any chance to appeal. The plaintiff dismissed the non-appearing defendant in August 2019. That would mean she had 30 days—until September 2019—to file a new notice of appeal. The plaintiff did not learn that her earlier notice was ineffective until yesterday, well after the time for filing a new notice had expired.
So absent the First Circuit reconsidering its decision, it’s probably too late for the plaintiff in Donahue. This is totally unnecessary. Granted, the time for filing a notice of appeal is jurisdictional, and litigants must take care to abide by jurisdictional rules. But the crime here—filing too early—is often harmless, and the punishment is severe.
This is precisely why I recently suggested that the Advisory Committee on Appellate Rules amend Rule 4(a)(2) to allow subsequent events to save any premature notice of appeal. Premature notices do little harm, and little harm comes from allowing subsequent events to save them.
Donahue v. Federal National Mortgage Association, 2020 WL 4726653 (1st Cir. Aug. 14, 2020), available at the First Circuit and Westlaw.