The en banc Fourth Circuit held that if the district court says nothing about leave to amend, a without-prejudice dismissal is a final, appealable decision.
August 18, 2022
The courts of appeals continue to wrestle with their jurisdiction after dismissals without prejudice. The most recent example is Britt v. DeJoy, in which the Fourth Circuit sat en banc to address finality when a district court dismisses a complaint or action without prejudice but also does not grant or deny leave to amend. The en banc court held that these dismissals are “final” under 28 U.S.C. § 1291 and thus appealable.
It’s a good decision. And the motivation behind it—reducing the uncertainty that comes from case-by-case determinations of finality—is commendable. The Fourth Circuit also gave some guidance on the related issues of (1) what plaintiffs must do to stand on a complaint dismissed with leave to amend and (2) finality when the time to amend has passed or was never set.
I just hope that counsel in the Fourth Circuit keep this new rule in mind. Litigants unaware of this new rule might inadvertently lose their right to appeal.
The Third Circuit explained the widespread rule that interlocutory decisions don’t merge into a final judgment when a case is dismissed for failure to prosecute. There is, however, some authority to the contrary.
August 18, 2022
Dismissals for failure to prosecute are appealable, and the court of appeals will review the propriety of the dismissal. The more interesting issue is what else the court of appeals will review. The merger rule normally means that all interlocutory decisions merge into the final judgment. But allowing litigants to appeal interlocutory decisions by inviting a failure-to-prosecute dismissal rewards dilatory tactics and risks piecemeal review.
The courts of appeals are nearly unanimous in refusing to review interlocutory orders that came before a dismissal for failure to prosecute. The Third Circuit did so in this week’s R & C Oilfield Services LLC v. American Wind Transport Group LLC. The district court ordered that the plaintiffs’ claims be arbitrated. Rather than arbitrate, the plaintiff did nothing, resulting in an eventual dismissal for failure to prosecute. On appeal, the Third Circuit refused to review the arbitration decision. The court of appeals determined that the failure-to-prosecute dismissal prevented the the arbitration decision from merging into the final judgment.
This is a good rule, though I might think about it as a rule of waiver rather than merger: the failure to prosecute waives any challenges to interlocutory orders. I’ll also note that I’ve run across two Second Circuit cases that reviewed interlocutory rulings after a failure-to-prosecute dismissal. And there might be some support for that approach in an old, cryptic Supreme Court decision.
The Fifth and Federal Circuits continue to disagree about where appeals of Walker Process antitrust/patent claims should go. It seems that both will now transfer these appeals to each other, and each might reluctantly accepting the transfer. This jurisdictional hot potato needs to stop.
August 16, 2022
The Fifth and Federal Circuits cannot agree on where appeals of Walker Process claims belong. These claims allege that someone violated the Sherman Act by fraudulently obtaining a patent. The Federal Circuit—which has exclusive jurisdiction over claims arising under the patent laws—thinks that these cases do not arise under the patent laws. So it transfers these appeals to the appropriate regional circuit. The Fifth Circuit—to which the Federal Circuit has sent these cases—disagrees. It thinks that these cases do arise under the patent laws and thus belong in the Federal Circuit. A case recently ping-ponged between these two courts for years before settling in the Federal Circuit. And last summer, in Chandler v. Phoenix Services, LLC, the Federal Circuit transferred another Walker Process appeal to the Fifth Circuit, risking another game of jurisdictional hot potato.
Thankfully the Fifth Circuit ended this round of transfers, concluding that the Federal Circuit’s transfer order in Chandler was “not implausible.” But the Fifth Circuit continued to disagree with the Federal Circuit on where Walker Process appeals belong.
This leaves litigants pursuing Walker Process appeals in a bind: to which circuit should they appeal? There’s now a good chance that wherever they appeal—the Fifth or Federal Circuits—the court of appeals will transfer the case. These circuits have essentially told litigants that if they want the Fifth Circuit to review a Walker Process issue, they should probably appeal to the Federal Circuit. And if they want the Federal Circuit to review the issue, they should probably appeal to the Fifth Circuit.
This is untenable. No good comes from the confusion over where to bring these appeals. And these transfers delay appellate resolution of these cases for no good reason.
The Seventh Circuit addressed whether voluntary dismissals implicate appellate jurisdiction (and said “no”) or Article III jurisdiction (and said “yes”). But the issue isn’t jurisdictional at all. Voluntary dismissals instead implicate the possible waiver of appellate review.
August 12, 2022
Litigants sometimes try to create a final, appealable decision by voluntarily dismissing some or all of their claims. These dismissals fall under the banner of manufactured finality, and they come in several forms. A litigant who loses on some claims might voluntarily dismiss its remaining claims and then appeal the loss. A litigant who faces an adverse interlocutory decision—one that makes a claim less attractive but does not actually decide it—might voluntarily dismiss its claims and try to appeal the interlocutory order. Or a litigant who faces a dispositive interlocutory order—one that effectively, though not technically, resolves all of the claims—might do the same.
When litigants try to manufacture a final decision, most courts of appeals see potential appellate-jurisdiction issues. But in Wednesday’s Levy v. West Coast Life Insurance Co., the Seventh Circuit said that voluntary dismissals do not implicate statutory appellate jurisdiction. They instead implicate Article III. The court ultimately held that it could review the dismissal of the plaintiffs’ claim, despite the plaintiffs’ having voluntarily dismissed that claim after the district court rejected their theories of liability. But in the course of doing so, the Seventh Circuit said that an appellant who consents to a judgment against it might not suffer the injury in fact that Article III requires.
The outcome in Levy was right—the plaintiffs had suffered a dispositive interlocutory order, and their voluntary dismissal merely accelerated the inevitable end of district court proceedings. And the Seventh Circuit was correct that voluntary dismissals should not raise appellate-jurisdiction issues. But most courts—including perhaps the Supreme Court—disagree on that point. And I don’t see how voluntary dismissals implicate Article III. The issue is instead one of waiver: a litigant who voluntarily dismisses its claims might waive any right to appellate review.
I’m writing a paper on this topic right now. So in this post, in addition to discussing Levy, I give an overview of my thoughts. Comments are very much welcome.
As part of a preliminary-injunction appeal, the Eleventh Circuit extended pendent appellate jurisdiction to a decision on both the adequacy of the plaintiff’s complaint and the plaintiff’s standing. But those issues were already part of the injunction appeal.
August 2, 2022
Pendent appellate jurisdiction allows a court of appeals to extend jurisdiction over a decision that would not normally be immediately appealable when the court has jurisdiction over another, related decision. Used almost entirely in the context of interlocutory appeals, pendent appellate jurisdiction says that the normally non-appealable issue piggybacks on the appealable one. The standards for pendent appellate jurisdiction are unsettled. The Supreme Court has shown little enthusiasm for the practice. But it is common in the courts of appeals.
In last week’s Schultz v. Alabama, the Eleventh Circuit used pendent appellate jurisdiction to review a decision on both the plaintiff’s standing and the adequacy of the plaintiff’s complaint as part of an injunction appeal. I initially thought that this was a defensible use of pendent appellate jurisdiction. But the case got me thinking: did the court really need pendent appellate jurisdiction? The adequacy of the complaint and the plaintiff’s standing were already part of the preliminary-injunction appeal. All pendent appellate jurisdiction did was let the court opine on orders—not issues—that it otherwise could not have addressed.
I’m starting to wonder if pendent appellate jurisdiction is ever actually necessary.
A split Fifth Circuit held that non-party discovery orders rejecting undue-burden claims are not immediately appealable under the collateral-order doctrine. It was a step in the right direction for a circuit that has some questionable caselaw on discovery appeals.
July 6, 2022
In Leonard v. Martin, a split Fifth Circuit held that non-parties cannot use the collateral-order doctrine to immediately appeal discovery orders that reject a claim of undue burden. Other avenues for immediate review—certified appeals under 28 U.S.C. § 1292(b), writs of mandamus, and contempt appeals—were available. The majority accordingly concluded that collateral-order appeals were unnecessary to ensure meaningful review of orders denying motions to quash on undue-burden grounds. Judge Haynes dissented, contending that the discovery order in question implicated important issues that could not be effectively reviewed via other means. And she suggested that non-party status alone might be enough to warrant an immediate appeal.
The Fifth Circuit has some questionable caselaw on appealing discovery orders via the collateral-order doctrine. I think the court allows too many of these appeals. I’m glad to see a case going the other way.
Rule 54(a) defines a judgment to include “any order from which an appeal lies.” So appealable interlocutory orders are “judgments.” And when there’s no separate document, litigants can have 180 days to appeal.
June 28, 2022
In Ueckert v. Guerra, the Fifth Circuit held that an appeal from the denial of qualified immunity was untimely, as it came 412 days after the district court’s bench ruling. In the course of doing so, the court explained that the defendant had 180 days to appeal this denial. That’s because the district court never set out its denial of immunity in a separate document. That denial was appealable and thus a judgment under Federal Rule of Civil Procedure 54(a). And most judgments must be set out in a separate document before the appeal clock begins running. Otherwise, the appeal clock begins running 150 days after the judgment. That’s what happened in Ueckert—the appeal clock began running 150 days after the immunity denial, at which point the defendant had 30 days to appeal.
As Ueckert explains, many (if not most) appealable interlocutory orders are not set out in a separate document. So treating appealable interlocutory orders as judgments gives litigants an immense—and, in the Fifth Circuit’s view, unreasonable—time to appeal interlocutory orders. The Rules Committee is aware of this problem. Yet it apparently hopes that courts will overlook it. The Fifth Circuit refused to do so. That means district courts can prevent these extended appeal windows only via “time-wasting paper-pushing, entering separate ‘judgments’ containing their holdings on every interlocutory motion that might be susceptible to appeal.” The Fifth Circuit accordingly called for the Rules Committee to take a look at the time for appealing interlocutory orders.
Microsoft Corp. v. Baker suggested that litigants can no longer manufacture an appeal of an adverse, interlocutory decision by voluntarily dismissing their claims with prejudice. But the Ninth Circuit just said that Baker applies only when there are specific rules on interlocutory appeals.
April 19, 2022
Sometimes litigants are unsatisfied with the existing avenues for interlocutory appeals. So they try to manufacture a final decision, often by voluntarily dismissing some or all of their claims. Manufactured finality comes in a variety of forms. In 2017’s Microsoft Corp. v. Baker, the Supreme Court shut down one of them. The Court held that plaintiffs hoping to bring a class action cannot appeal an adverse class-certification decision by voluntarily dismissing their individual claims with prejudice. That form of manufactured finality was an attempted end-run around the rules governing interlocutory appeals from class-certification decisions, particularly Federal Rule of Civil Procedure 23(f).
Baker suggests that litigants can no longer manufacture an interlocutory appeal by voluntarily dismissing their claims and then trying to appeal an interlocutory district court decision that harmed—but did not resolve—those claims But in last week’s Trendsettah USA, Inc. v. Swisher International, Inc., the Ninth Circuit said that litigants could still use this tactic in most contexts. The district court in Trendsettah vacated a jury verdict and ordered a new trial. Rather than face that new trial, the plaintiff voluntarily dismissed its claims with prejudice and tried to appeal the new-trial decision. The Ninth Circuit held that the voluntary dismissal produced a final, appealable decision. Baker, the court thought, applied only when this tactic imperiled specific rules on interlocutory appeals.
I don’t buy it. Just like the plaintiffs in Baker and similar decisions, the plaintiff in Trendsettah was trying to avoid the normal limits on interlocutory appeals. That those limits apply generally (rather than to a specific context) should make no difference. And the plaintiff in Trendsettah had not lost on it claims. It instead decided that litigating further was not worth it. So the plaintiff got exactly what it asked for: a with-prejudice dismissal of its claims.
The Seventh Circuit held that there was no jurisdictional time limit on seeking a Rule 54(b) partial judgment. And it questioned earlier decisions imposing a 30-day deadline (albeit a non-jurisdictional, claims-processing one) on those requests.
April 7, 2022
When an action involves multiple claims, appeals normally must wait until the district court has resolved all of claims. Federal Rule of Civil Procedure 54(b) is one exception to this general rule. It permits a district court to enter a partial judgment on the resolution of some (but not all) claims in an action. That partial judgment is then a final, appealable decision.
What is the deadline for seeking a Rule 54(b) partial judgment? Two Seventh Circuit decisions (one from 1972, the other from 2017) held that the request must come within 30 days of the district court’s decision. Late-filed Rule 54(b) motions required reversing the partial judgment and dismissing the appeal.
But in Wednesday’s DaSilva v. Indiana, the Seventh Circuit determined that this 30-day deadline is not jurisdictional. It is instead a claims-processing rule. So a delayed request for a Rule 54(b) partial judgment does not affect appellate jurisdiction. And an appellee can forfeit any objection to a late-filed Rule 54(b) motion.
The Seventh Circuit also questioned the 30-day limit itself. Although the procedural rules are lousy with deadlines, Rule 54(b) does not contain one. DaSilva ultimately did not require the Seventh Circuit to determine whether the 30-day deadline should exist. It was enough to say that Indiana forfeited any objection. The court suggested, however, that any timeliness issues might best be addressed by asking whether the district court abused its discretion in entering the Rule 54(b) partial judgment.
The Eighth Circuit didn’t apply the recently amended Rule 3(c) to a pending case (or even mention the amendment). Did the court not think it was “just and practicable” to apply the new rule? Or did the court overlook the amendment?
March 30, 2022
The Supreme Court recently amended Federal Rule of Appellate Procedure 3(c). Before these amendments, several courts of appeals had used Rule 3(c)’s order-designation requirement to limit the scope of an appeal. The amendments—which were a necessary fix to a bad misreading of Rule 3(c)—became effective December 1, 2021. The Supreme Court’s order adopting the amendments said that the new rule would “govern in all proceedings in appellate cases thereafter commenced and, insofar as just and practicable, all proceedings then pending.”
The Eighth Circuit was one of the courts that had used Rule 3(c) to limit the scope of appeals. Indeed, in Neal Katyal and Sean Marotta’s letter asking the Advisory Committee on Appellate Rules to look into the issue, they focused on the Eight Circuit’s caselaw. But in Monday’s Gustafson v. Bi-State Development Agency, the Eighth Circuit again said that designating one interlocutory order in a notice of appeal bars review of other interlocutory orders. The decision never mentioned the revisions to Rule 3(c). To be fair, the case was appealed before the new Rule 3(c) became effective. Perhaps the Eighth Circuit did not think it was “just and practicable” to apply the amended rule to a pending case.
As I’ve said many times, these amendments to Rule 3(c) couldn’t have come soon enough. I hope the Eighth Circuit will soon acknowledge the abrogation of its cases that misread Rule 3(c) and needlessly limited the scope of appeal.