Hendrickson v. United States
2015 U.S. App. LEXIS 11186
2d Cir.2015Background
- In 1982 the Hendricksons sued the United States under the FTCA for auto-accident damages; after trial the parties reached a settlement and placed general terms on the record on March 29, 1985.
- On April 2, 1985 the district court entered a one-sentence dismissal "without costs and on the merits," noting the case had been settled but neither retaining jurisdiction nor incorporating settlement terms.
- On April 29, 1985 the parties submitted and the district court "so-ordered" a detailed Stipulation for Compromise Settlement specifying periodic annuity payments to the Hendricksons; that document does not appear on the docket.
- For ~28 years the U.S. purchased an annuity from Executive Life (ELNY) and the Hendricksons received payments; in 2013 ELNY entered liquidation and payments were reduced approximately 50%.
- Plaintiffs moved in the district court to enforce the 1985 Settlement Agreement, seeking the Government to make up the reduced annuity payments; the district court enforced the settlement and ordered the United States to pay the shortfall.
- The Second Circuit reversed: the April 2 dismissal neither retained jurisdiction nor incorporated settlement terms under Kokkonen; the April 29 post-dismissal so-order could not revive or modify jurisdiction; the case was remanded for transfer to the Court of Federal Claims.
Issues
| Issue | Hendrickson's Argument | United States' Argument | Held |
|---|---|---|---|
| Whether the district court retained ancillary jurisdiction to enforce the 1985 settlement | Court approved settlement on record and later so-ordered the agreement, supplying judicial imprimatur to retain jurisdiction | Kokkonen requires either express retention of jurisdiction in the dismissal or incorporation of settlement terms into the dismissal; neither occurred | No ancillary jurisdiction: dismissal did not expressly retain jurisdiction nor incorporate terms; Kokkonen controls |
| Whether the April 29 so-ordered Settlement Agreement (filed after dismissal) itself conferred jurisdiction | The so-ordered agreement is a court order and thus incorporated the settlement terms | A post-dismissal order issued after the court lost jurisdiction cannot create ancillary jurisdiction | No; post-dismissal so-ordering is ineffective to retain jurisdiction after dismissal |
| Whether the April 29 action could be treated as a Rule 60(a) correction of the April 2 dismissal to incorporate settlement terms | The April 29 so-order corrected an oversight and thus amended the April 2 judgment to retain jurisdiction | Rule 60(a) corrects clerical mistakes/oversights; April 2 omission was not a clerical mistake because terms were still being finalized | No; Rule 60(a) inapplicable because omission was not clerical and post-dismissal action cannot create jurisdiction |
| Proper remedy and forum for enforcement | District court enforcement | United States: district court lacks subject-matter jurisdiction over this contract claim; Tucker Act jurisdiction in Court of Federal Claims | Vacate district-court enforcement orders and remand with instruction to transfer to the Court of Federal Claims under 28 U.S.C. § 1631 |
Key Cases Cited
- Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (1994) (district court retains ancillary jurisdiction over settlement enforcement only if dismissal expressly retains jurisdiction or incorporates the settlement)
- Perez v. Westchester County Dept. of Corrections, 587 F.3d 143 (2d Cir. 2009) (discusses "judicial imprimatur" in prevailing-party/fee context; jurisdiction there derived from incorporation of settlement)
- In re Am. Express Fin. Advisors Sec. Litig., 672 F.3d 113 (2d Cir. 2011) (reiterates Kokkonen requirements and notes limitations of "judicial imprimatur" dicta)
- StreetEasy, Inc. v. Chertok, 752 F.3d 298 (2d Cir. 2014) (affirms Kokkonen's two exclusive methods for retaining ancillary jurisdiction)
- SmallBizPros, Inc. v. MacDonald, 618 F.3d 458 (5th Cir. 2010) (post-dismissal orders cannot confer jurisdiction retained at dismissal)
- Anago Franchising, Inc. v. Shaz, LLC, 677 F.3d 1272 (11th Cir. 2012) (same as SmallBizPros; Kokkonen steps must be taken before dismissal)
- Buckhannon Bd. & Care Home, Inc. v. W. Va. Dept. of Health & Human Res., 532 U.S. 598 (2001) (discusses "judicially sanctioned" change in legal relationship relevant to prevailing-party analysis)