The Week in Federal Appellate Jurisdiction: April 10–16, 2022

The only major appellate-jurisdiction decision from last week was the Ninth Circuit’s attempt to limit the impact of Microsoft Corp. v. Baker. Baker said that class-action plaintiffs cannot appeal an adverse class-certification decision by voluntarily dismissing their claims. The Ninth Circuit held that this bar on manufacturing an appeal via a voluntary dismissal applied only to contexts in which there are special appellate-jurisdiction rules, like class actions and arbitration.

In other decisions, the Federal Circuit held that the voluntary, without-prejudice dismissal of an unresolved counterclaim did not result in a final decision. The Second Circuit dismissed an arbitration appeal because the district court was not yet done with the dispute over arbitration. And the Fifth Circuit refused to extend pendent appellate jurisdiction over a transfer decision.

• The Ninth Circuit Limited Baker & Preserved Manufactured Finality
• Quick Notes

The Ninth Circuit Limited Baker & Preserved Manufactured Finality

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.

For more on Trendsettah, see my post The Ninth Circuit Limits Baker, Preserves Manufactured Finality.

Trendsettah USA, Inc. v. Swisher International, Inc., 2022 WL 1123196 (9th Cir. Apr. 15, 2022), available at the Ninth Circuit and Westlaw.

Quick Notes

In United Access Technologies, LLC v. AT&T Corp., the Federal Circuit held that a voluntary, without-prejudice dismissal of an unresolved counterclaim did not result in a final decision. United Access was a patent-infringement action, and the district court granted summary judgment for the defendant on noninfringement. The district court did not resolve the defendant’s counterclaim for invalidity. So the parties stipulated to dismiss that counterclaim without prejudice, and the plaintiff appealed. But the Federal Circuit held that the voluntary dismissal did not produce a final, appealable decision. The court of appeals emphasized that the the district court did not approve of or otherwise participate in the dismissal.

United Access Technologies, LLC v. AT&T Corp., 2022 WL 1124961 (Fed. Cir. Apr. 15, 2022), available at the Federal Circuit and Westlaw.

In Spliethoff Transport B.V. v. Phyto-Charter, Inc., the Second Circuit dismissed an appeal from an order directing arbitration to proceed. The Second Circuit noted that it would have jurisdiction if the district court had ordered arbitration and dismissed the action. But the district court in Spliethoff Transport was not finished with the action. The district court ordered arbitration to proceed but added that if the parties could not agree on an arbitrator, the district court would pick one. The district court thus anticipated the possibility of further litigation. Since there was more for the district court to do, there was no final decision.

Spliethoff Transport B.V. v. Phyto-Charter, Inc., 2022 WL 1122684 (2d Cir. Apr. 15, 2022), available at CourtListener and Westlaw.

And in Noble Capital Fund Management v. US Capital Global Investment Management, the Fifth Circuit refused to review the denial of a transfer motion as part of an arbitration appeal. The district court denied the defendant’s motion to compel arbitration, which the Fifth Circuit had jurisdiction to review via 9 U.S.C. § 16(a)(1)(A). But the court of appeals would not extend pendent appellate jurisdiction to transfer issue. “The factors considered in reviewing a denial of a motion to transfer venue are entirely distinct from the factors considered in reviewing a denial of a motion to stay judicial proceedings and compel arbitration.” So the Fifth Circuit did not need to “consider the motion to transfer venue in order to address the motion to compel arbitration and stay proceedings.” “And these issues are not so related as to where resolving them together would promote judicial economy.”

Noble Capital Fund Management v. US Capital Global Investment Management, 2022 WL 1099006 (5th Cir. Apr. 13, 2022), available at the Fifth Circuit and Westlaw.