Appellate Decisions

The Merger Doctrine After Sanction Dismissals

The Second Circuit held that interlocutory orders do not merge into a final judgment when the action was dismissed as a discovery sanction.

March 28, 2024

By Bryan Lammon

Courts have long held that the merger doctrine does not apply when an action is dismissed for a failure to prosecute. In Marquez v. Silver, the Second Circuit extended this holding to actions dismissed as a discovery sanction. The court explained that sanction dismissals carry the same risk of strategic behavior as failure-to-prosecute dismissals. The court also noted that if the sanction dismissal was proper, any errors in the district court’s other decisions are irrelevant.

The Sanction Dismissal in Marquez

Simplifying a bit, the district court in Marquez dismissed some of the plaintiff’s claims at the pleading stage. Litigation then proceeded on the plaintiff’s other claims. But the district court eventually dismissed the action as a sanction for the plaintiff’s failure to comply with discovery obligations.

The plaintiff then appealed, seeking review of the district court’s initial dismissal of some of her claims. The plaintiff did not, however, seek to reverse the sanction dismissal.

A Merger Doctrine Exception for Sanction Dismissals

The Second Circuit held that it could not review the district court’s decision dismissing some of the plaintiff’s claims.

The Merger Doctrine & the Failure-to-Prosecute Exception

To be sure, the sanction dismissal ended the action. And under the merger doctrine, interlocutory decisions normally merge into a final judgment. So in an appeal from a final judgment, the scope of appeal normally covers all interlocutory decisions that have not been rendered moot by subsequent events.

But a widespread exception to the merger rule exists when actions are dismissed for a failure to prosecute. Courts are concerned that a litigant aggrieved by an interlocutory order might invite a failure-to-prosecute dismissal in an attempt to secure immediate appellate review of that order. This tactic risks piecemeal appellate review and undermines the existing avenues for interlocutory appeals.

Courts accordingly hold that while the failure-to-prosecute dismissal is itself appealable, prior district court orders do not merge into the final judgment and thus are not within the scope of appeal.

Extending the Exception to Sanction Dismissals

The Second Circuit is among the courts that have applied this merger-doctrine exception for failure-to-prosecute dismissals. And in unpublished decisions, the Second Circuit had applied this exception to sanctions dismissals.

The court concluded that it was time to do so in a published decision. Just like failure-to-prosecute dismissals, applying the normal merger doctrine to sanction dismissals would encourage attempts to circumvent the final-judgment rule by permitting what are essentially interlocutory appeals. And if the sanction dismissal was proper, any earlier interlocutory decisions are irrelevant to the action’s outcome.

The Second Circuit accordingly dismissed the appeal. If the plaintiff wanted to obtain review of the district court decision dismissing some of her claims, she first had to get a court to reverse or vacate the sanction dismissal.

Marquez v. Silver, 2024 WL 1289251 (2d Cir. Mar. 27, 2024), available at CourtListener and Westlaw

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