In City of Burnsville v. Koppers, Inc., No. 21-3177 (8th Cir. July 19, 2023), a split Eight Circuit panel dismisses an appeal that it holds arose from a non-final judgment, where the parties agreed to voluntarily dismiss all remaining claims without prejudice to appeal a contested issue of law.
“Several cities in Minnesota allege that a chemical in refined coal tar that was used in pavement sealants contaminated their stormwater ponds. They filed an action seeking damages from refiners and manufacturers of the tar. The ‘refiner’ defendants take raw coal tar and refine it into a product used by the ‘manufacturer’ defendants to create pavement sealants. The district court dismissed all of the claims against the refiners, and dismissed all but three of the claims against the manufacturers.”
After failing to persuade the district court to certify the dismissal for immediate appeal, “[t]he Cities then entered into an agreement with the manufacturers. This agreement provided that the Cities would conditionally dismiss their claims against the manufacturers. The condition was that if this court were to reverse the district court’s dismissal of the claims against the refiners, then the Cities would ‘reinstate’ their claims against the manufacturers, and the statute of limitations would be tolled to allow such a reinstatement.” Dismissal was effected by way of a “stipulation of dismissal” under Rule 41(a)(1)(A)(ii).
The panel majority holds that this agreement did not create a final decision subject to appeal of right under 28 U.S.C. § 1291. While a plaintiff in a multi-defendant case “may create a final decision on the dismissal of claims against one defendant by unconditionally dismissing claims against a second defendant,” the panel holds that the same stratagem fails “where a plaintiff joins multiple defendants and then seeks to manufacture a final judgment by conditionally dismissing claims against certain defendants.” Such a conditional dismissal, the panel majority holds, “effectively leaves claims pending in the district court, and allows the plaintiff to avoid the usual consequences of a dismissal.”
Federal Rule of Civil Procedure 54(b) is the approved path for appealing from such multi-party/-claim cases. “But here, the district court ruled that delay presented no . . . injustice, and that ordinary rules of finality should apply.” Allowing an appeal here would render Rule 54(b) a nullity by allowing the parties to negotiate their way around it. “We thus agree with other circuits that the form of conditional dismissal presented here does not create a final decision.”
Dissenting, Judge Kelly – though decrying “the parties’ transparent efforts to circumvent the final decision rule in this case,” nonetheless would hold that “our precedent establishes that we . . . have jurisdiction over this appeal . . . . I believe we have jurisdiction here because, by operation of the Federal Rules of Civil Procedure, the Cities’ dismissal of their pending claims against the remaining manufacturer-defendants was not, in fact, conditional. And any private agreement between the parties claiming something to the contrary is not binding on this court—or on the district court if the case were to be remanded.”
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