Voluntary dismissals after adverse interlocutory orders don’t create a jurisdictional problem. They instead implicate waiver.
September 6, 2023
I have a new article on appeals from voluntary dismissals after an adverse interlocutory decision.
The Eleventh Circuit held that plaintiffs can voluntarily dismiss only entire actions, regardless of whether they use Rule 41(a)(1) or (2).
May 16, 2023
Earlier this year, the Eleventh Circuit reiterated its rule that litigants cannot voluntarily dismiss individual claims under Federal Rule of Civil Procedure 41(a)(1). That portion of the rule permits plaintiffs to voluntarily dismiss “an action without a court order.” So plaintiffs can dismiss only entire actions under Rule 41(a)(1), and attempts to dismiss individual claims are ineffective.
Last week, in Rosell v. VMSB, LLC, the Eleventh Circuit added that litigants cannot voluntarily dismiss individual claims Rule 41(a)(2). That part of Rule 41 permits voluntary dismissals via court order. But, according to the Eleventh Circuit, it also permits the dismissal only of entire actions. So when the litigants in Rosell settled the only unresolved claim, they needed to either obtain a partial judgment under Federal Rule of Civil Procedure 54(b) or amend the complaint to remove the settled claim. Otherwise, there would be no final decision and no opportunity to appeal.
As I said earlier this year, I have my doubts about the “actions-only” interpretation of Rule 41. Rosell only reinforces those doubts.
The Eleventh Circuit held that a Rule 41(a)(1)(A) dismissal—which purported to dismiss all unresolved claims—was ineffective and thus did not produce a final, appealable decision.
February 20, 2023
In In re Esteva, the Eleventh Circuit dismissed an appeal after concluding that a Rule 41(a)(1)(A) voluntary dismissal was ineffective. The stipulated dismissal purported to dismiss all unresolved claims. But according to the Eleventh Circuit, that’s not allowed—Rule 41(a)(1)(A) permits the voluntary dismissal of only entire actions, not individual claims. With the voluntary dismissal ineffective, the unresolved claims were still pending in the district court.
Most (if not all) courts of appeals hold that litigants cannot dismiss individual claims via Rule 41(a)(1)(A) dismissals. But I’m not so sure about that reading of the rule.
The courts of appeals have created an asinine finality trap that they need to get rid of. The trap also makes me wonder whether we need to rethink finality.
November 29, 2022
I’ve written a lot on this site about the finality trap in the last few years. Now I’ve published an essay on the trap in the New York University Law Review Online. I argue that the trap is asinine. And there’s an easy fix to it: let litigants disclaim the right to refile voluntarily dismissed claims. But the trap also makes me wonder if we should rethink finality. Current finality doctrine largely looks to what the district court has done—has the district court actually resolved all of the claims? It might be better to instead ask whether the district court is done. That is, once the district court has finished with an action, it has issued a final decision and the court of appeals has jurisdiction.
The essay is Disarming the Finality Trap, 97 New York University Law Review Online 173 (2022). You can download a copy at SSRN. The abstract is below.
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.
A new cert petition challenges the Ninth Circuit’s variation on the finality trap.
April 14, 2021
The last year or so has seen some significant judicial activity when it comes to the finality trap. The trap can arise after a party voluntarily dismisses some of its claims without prejudice and then tries to appeal. This scenario makes some courts of appeals suspicious, as parties sometimes use these voluntary dismissals to manufacture an interlocutory appeal. The courts have developed a variety of ways to stop parties from doing so. And some of those methods create a trap. The court of appeals deems the dismissal non-final and thus non-appealable. But the court also leaves no avenue for the appealing party to make the underlying decision final. The party is then left in limbo. The case is over and unchangeable in the district court. But it’s not final for purposes of appeal.
A new cert petition challenges the Ninth Circuit’s variation on the finality trap. More generally, the petition gives the Supreme Court a chance to disarm the trap once and for all. The case is Starline Tours of Hollywood, Inc. v. EHM Productions, Inc. The response is due May 7, 2021.
The Tenth Circuit tackled a slew of appellate-jurisdiction issues before addressing an attorney’s appeal from conditions on refiling.
April 5, 2021
In Frank v. Crawley Petroleum Corp., the Tenth Circuit addressed just about every appellate-jurisdiction issue that could arise when an attorney appeals to challenge conditions on refiling. The district court in Frank had granted the plaintiff’s voluntary dismissal of a purported class action. But in doing so, the court restricted the plaintiff’s attorney’s ability to refile a similar class action. In the attorney’s appeal, the Tenth Circuit addressed the adequacy of the notice of appeal, the proper party for the appeal, appellate standing, and finality. The court ultimately concluded that none of these issues stood in the way of the court’s addressing the merits. So the attorney could appeal to challenge the restrictions on refiling.
The Eleventh Circuit held that a decision was final and appealable despite the voluntary dismissal of all remaining claims without prejudice.
July 17, 2020
In Corley v. Long-Lewis, Inc., the Eleventh Circuit held that a district court’s resolution of all claims was final and appealable despite the plaintiffs’ voluntarily dismissing some of those claims without prejudice. In doing so, the court had to wade through its conflicting lines of authority in this area—one holding that the resolution of all claims is final despite the voluntary dismissal, the other holding that it’s not. The conflicting cases could not be reconciled. The court accordingly had to go with the older precedent. And that precedent held that “an order granting a motion to voluntarily dismiss the remainder of a complaint under Rule 41(a)(2) ‘qualifies as a final judgment for purposes of appeal.’” The court also addressed its territorial jurisdiction to review the decision of an MDL transferee court and appellate standing after some claims are voluntarily dismissed. And Chief Judge William Pryor—who authored the majority opinion—wrote a separate concurrence discussing the messy state of the law governing governing appeals after voluntary dismissals and offering alternatives to avoid that mess.
The Fifth Circuit again demanded that parties obtain a Rule 54(b) certification when a claim has been dismissed without prejudice.
July 9, 2020
The Fifth Circuit’s finality trap has another victim. In Firefighters’ Retirement System v. Citco Group Ltd., the court held that the district court had not issued a final, appealable decision when claims against one defendant had been dismissed without prejudice. To appeal, the plaintiffs needed to obtain a certification under Federal Rule of Civil Procedure 54(b) (and will presumably be allowed to do so).
Firefighters’ Retirement is thus another illustration of the Fifth Circuit’s foolish finality trap. Unlike other recent finality trap cases, the dismissal without prejudice in Firefighters’ Retirement came between with-prejudice dismissals. But the plaintiffs were trying to appeal a district court decision that came before the dismissal without prejudice. And that was enough to preclude finality. The Fifth Circuit declined to address what would happen if claims were dismissed without prejudice before the decision that a party sought to appeal.
The Fourth Circuit held that when the dismissal of some claims necessarily resolves all other claims, parties can appeal by voluntarily dismissing those remaining claims.
May 27, 2020
In Affinity Living Group, LLC v. StarStone Specialty Insurance Co., a divided Fourth Circuit held that it had appellate jurisdiction despite the parties’ stipulating to dismiss some claims without prejudice. The district court had issued a decision that necessarily—though not technically—resolved all of the claims, including the voluntarily dismissed ones. The decision dismissed two of the plaintiff’s claims. And its reasoning necessarily decided the two others. That is, the district court’s dismissal of the two claims “rendered legally deficient” the remaining claims. So even though the district court never formally dismissed the remaining claims, their dismissal was inevitable. The parties thus saved everyone some time by stipulating to their dismissal.
This is what Microsoft Corp. v. Baker should have said. Baker rightly held that plaintiffs in a class action cannot voluntarily dismiss their individual claims and then appeal the earlier denial of class certification. Although the denial of class certification might have made pursuing those individual claims economically irrational, it did not necessarily resolve them. The plaintiffs could have kept going. That’s why they shouldn’t have been able to manufacture an interlocutory appeal by voluntarily dismissing their claims. But when an interlocutory decision means that there’s nowhere else for plaintiffs to go—that their claims, though technically pending, are legally done—there’s no reason to not allow an appeal via voluntary dismissal.