Failure to Certify Involuntary Dismissals Under Rule 54(b) Leads to No Federal Appellate Jurisdiction United States Court of Appeals, 5th Circuit August 24, 2018
LOUISIANA –The decedent Frank Williams allegedly contracted mesothelioma through asbestos exposure while working at the NASA Michoud Assembly Facility (MAF). Lockheed Martin removed to federal court under the federal officer removal statute. The case was transferred to the Asbestos MDL, after which decedent’s children were substituted as the plaintiffs. The Asbestos MDL court issued various orders, including granting motions for summary judgment, and ultimately remanded the entire case back to Louisiana state court; plaintiffs then voluntarily dismissed their claims against the four remaining defendants. One dismissal was with prejudice, but the other orders of dismissal did not state whether they were with or without prejudice. The plaintiffs then filed notices of appeal with the 5th Circuit relevant to various orders concerning defendants Boeing, TSI, McCarty, and Lockheed Martin. The plaintiffs also filed a motion in the federal district court of Louisiana, seeking a final judgment under Federal Rule of Procedure 54. While this motion was pending, Lockheed Martin and Boeing filed motions to dismiss in the 5th circuit for lack of jurisdiction, which were granted.
Despite their pending Rule 54 motion, plaintiffs also filed a motion to request final judgment under Rule 58(b)(1)(C) in the Louisiana district court. The plaintiffs argued that all judgments in favor of all defendants should be certified as final and appealable because all claims have been dismissed and there are no defendants left before the court. The district court granted the Rule 58 motion and dismissed the Rule 54 motion as moot. The plaintiffs then filed notices of appeal regarding various discovery orders and the grant of summary judgment motions.
The 5th Circuit analyzed 28 U.S.C. Section 1291, which dictated that the court “shall have jurisdiction of appeals from all final decisions of the district courts…”. This “final judgment rule” created appellate jurisdiction only after a district court’s decision that “ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.” The 5th Circuit pointed to the settled rule that “appellate jurisdiction over a non-final order cannot be created by dismissing the remaining claims without prejudice.” For purposed of Section 1291, a dismissal without prejudice is not considered a “final decision.” The party seeking to create finality through dismissal without prejudice of remaining claims must file for Rule 54(b) certification with the trial court, which allowed the district court to direct entry of a final judgment as to one or more, but fewer than all, claims or parties.
In this case, the district court’s order dismissing three remaining defendants was silent as to whether it was with or without prejudice; since the court assumed it was without prejudice, it was not a final decision creating appellate jurisdiction. Further, the district court’s order granting the plaintiffs’ Rule 58 motion for entry of judgment did not create appellate jurisdiction, because it did not alter the order dismissing multiple defendants without prejudice. If the district court had certified the involuntary dismissals under Rule 54(b), the court would have appellate jurisdiction. Thus the 5th Circuit dismissed the plaintiffs’ appeals for lack of jurisdiction.