Lead Opinion
NEWMAN, Cirсuit Judge, dissents from the order granting the motion to dismiss.
ORDER
Citrix Systems, Inc. (“Citrix”) moves to dismiss as premature Alexander S. Orenshteyn’s (“Orenshteyn”) appeal of an October 1, 2010, order granting in part a motion for sanctions. Orenshteyn opposes.
On April 6, 2002, Orenshteyn filed a complaint against Citrix alleging patent infringement. During the course of litigation, the district court granted in part Citrix’s motion for sanctions against Orenshteyn and his prior counsel, and referred the matter to a magistrate judge for a report and recommendation to determine the amount of sanctions. Subsequently, the district court granted Citrix’s motion on the merits for summary judgment of invalidity. Orenshteyn appealed, seeking review of the district court’s invalidity determination and the order granting sanctions. The district court has not yet made a final determination regarding the amount of sanctions.
Citrix contends that the portion of Orenshteyn’s appeal concerning the order granting sanctions is premature because that order is not a final, appealable decision. See View Eng’g, Inc. v. Robotic Vision Sys., Inc.,
By stаtute, this court has jurisdiction over an appeal of a decision of a district court if it is “final” under 28 U.S.C. § 1295(a)(1) or if it is an interlocutory order as specified in 28 U.S.C. § 1292. The district court’s decision on the mer
In rare circumstances, the doctrine of pendent appellate jurisdiction allows federal courts of appeals limited discretion to review a ruling that is not independently appealable if jurisdiction exists over another related ruling. Cf. Swint v. Chambers Cnty. Comm’n,
The Supreme Court in Swint provided two essential reasons why pendent jurisdiction should be limited. First, Congress specifically provided district courts the authority to certify an interlocutory order as aрpealable under 28 U.S.C. § 1292(b) (applicable to this court under 28 U.S.C. § 1292(c)(1)), and § 1292(b) is undermined if appellate courts take jurisdiction over appeals from non-final orders in the absence of district court certification. Swint,
After Swint, it is clear that a court of appeals may have pendent jurisdiction when the appealable and nonappealable decisions are “inextricably intertwined” or when review of the non-appealable decision is necessary to review the appealable one. See id. at 51,
Relying on Swint, this court found no pendent jurisdiction in Falana based on similar facts to those present here.
This court’s holding in Falana is consistent with the holdings of other circuits declining to exercise pendent jurisdiction over unquantified sanctions or attorney fees. Several circuits declined to exercise jurisdiction over unquantified attorney fees when appealed with final decisions even before Swint. See Cooper v. Salomon Bros.,
There have been rare cases in which courts in other circuits have taken jurisdiction over an unquantified award of attorney fees, but these were special cases, such as when the award actually met one of the Swint tests for pendent appellate jurisdiction. See Thornton v. Gen. Motors Corp.,
Therefore, the circuits, including this one, are in general agreement that an unquantified award of attorney fees does not usually warrant the exercise of pendent jurisdiction. Unlike Thornton and M & C in which the final decision and the non-final award of attorney fees had essentially the same legal basis, the finding of invalidity and the sanctions in the present case have different legal bases requiring different legal analyses. Thus, this court finds no indication in the present case that the unquantified sanction is “inextricably intertwined” with or necessary to review the final decision on the merits. See Swint,
The dissent errs in relying on Akron Polymer Container Corp. v. Exxel Container, Inc.,
[W]e recognize that this court has reviewed an award of attorney fees with*1361 out a quantified amount. E.g., Akron Polymer Container Corp. v. Exxel Container, Inc.,148 F.3d 1380 ,47 USPQ2d 1533 (Fed.Cir.1998). However, in Akron, the finality issue was raised neither by the parties nor sua sponte by the court. Because Akron did not confront and decide the same issue, it is not precedent on the question before us.
Special Devices, Inc. v. OEA, Inc.,
Majorette is also not controlling for three reasons: Majorette is dicta with regard to exercising jurisdiction over unquantified attorney fees; it is distinguishable from the present case; and it was superseded by Swint. First, Majorette asserted that the court had jurisdiction over what, after Budinich, would be a final decision on the merits and a non-final award of unquantified attorney fees. See Majorette,
Additionally, the interpretation of Majorette in Johannsen v. Pay Less Drug Stores Nw., Inc.,
Second, Johannsen made clear that § 1292(c)(2) applies only when there is a finding of patent infringement. Johannsen,
Third, Majorette preceded the Supreme Court’s Swint decision, and so Swint supersedes Majorette to the extent that the two conflict. We disagree with the dissent’s argument that Swint is distinguishable because the pendent jurisdiction at issue in Swint was “pendent party” jurisdiction and the appealable decision in Swint “was only appealable under the collateral order doctrine.” Dissent Op. at 1369-71. Swint discusses pendent jurisdiction generally, and the reasoning provided therein is broadly applicable to all pendent jurisdiction. See Swint,
Finally, while the dissent observes that cases after Swint have used language different in degree from that present in Swint, including references to judicial efficiency, Dissent Op. at 1367-68, 1372-73, these cases typically rely on, refer to, or are consistent with the Swint tests. See In re Tutu Wells Contamination Litig.,
Even if this court could take jurisdiction in the present case — which it cannot — the exercise of pendent jurisdiction is discretionary, and this court would decline to exercise its discretion in this case. See Intel,
Consistent with Falana, and following the Supreme Court’s decision in Swint, we
Accordingly,
It Is Ordered That:
Citrix’s motion to dismiss the appeal of the district court’s sanction order is granted.
Dissenting Opinion
dissenting.
On this appeal from the district court’s final judgment of patent invalidity and accompanying sanctions, the defendant Citrix Systems moved to dismiss as premature that portion of the appeal that relates tо the award of sanctions. My colleagues on this panel hold that the final judgment on the merits is appealable, but refuse to include the appeal of the accompanying sanctions because the attorney fees and costs have not been quantified. The final judgment of invalidity, and the attorney fees and costs awarded as sanctions, arise from the same factual and legal considerations, and will now require further redundancy of effort, by yet a third panel of this court. The result is not only judicial inefficiency, at the district court as well as this court, but also unnecessary burdens and costs for the parties. From my colleagues’ inappropriate disposition, I respectfully dissent.
Discussion
This case started in 2002, when Mr. Orenshteyn, through prior counsel, sued Citrix for .patent infringement. In 2003 the district court granted Citrix’s motion for summary judgment of non-infringement, and levied sanctions against Mr. Orenshteyn under Rule 11, and against his counsel under Rule 11 and 28 U.S.C. § 1927.
On appeal, this court reversed the summary judgment of non-infringement. The court also reversed the Rule 11 sanctions for failure to comply with the twenty-one day “safe harbor” provision of Rule 11(c)(2). Orenshteyn v. Citrix Sys., Inc.,
On remand, the district court reimposed the same sanctions, but instead of Rule 11 the court substituted its inherent powers, and also reapplied the § 1927 sanction against counsel. The district court also granted Citrix’s motion for summary judgment of patent invalidity, and entered final judgment. Mr. Orenshteyn, now with different counsel, filed this appeal from the final judgment and the sanctions. The district court, in declining to proceed with quantification of the sanctions, stated that “a finding in favor of Plaintiff on appeal could affect Citrix’s entitlement to attorney fees and costs.” Order Staying Motion to Determine Fees and Costs, Doc. # 375, Mar. 21, 2011. My colleagues on this panel apparently deem this to be reversible error. It is not. The distriсt court acted in accordance with precedent and logic, a pragmatic move toward resolution of this prolonged litigation. In contrast, the panel majority now requires the district court to proceed with quantifica
The controlling precedent of the Federal Circuit is Majorette Toys, Inc. v. Darda, Inc.,
(2) of an appeal from a judgment in a civil action for patent infringement which would otherwise be appealable to the United States Court of Appeals for the Federal Circuit and is final except for an accounting.
The court in Majorette Toys stated that “allowing the present appeal will prevent loss of time and expense,” for “quantification will be irrelevant if on the bifurcated appeal this court determines that it was an abuse of discretion to award attorney fees at all.”
In Akron Polymer Container Corp. v. Exxel Container, Inc.,
In the cases relied upon by the panel majority, the sanctions were not appealed along with a final judgment on the merits, as they are here. In Special Devices, Inc. v. OEA, Inc.,
Citrix offers the argument that Majorette Toys allows review only when sanctions are awarded in favor of the pаtentee, and not when the award is in favor of the accused infringer. However, no basis for excluding the patentee from seeking review appears in that decision. Majorette Toys states that “Plaintiffs, appellees here, have moved to dismiss and/or remand the appeal on the ground that, because the judgment has not quantified attorney fees and costs, it is neither a final decision pursuant to 28 U.S.C. § 1295(a) nor an appealable interlocutory decision pursuant to 28 U.S.C. § 1292.”
My colleagues criticize Majorette Toys for analogizing to § 1292, stating that the court had “no statutory basis upon which to draw such an analogy.” Maj. op. at 8. This court has noted that “the judgment in Majorette Toys was actually a ‘final decision’ appealable under § 1295, and the court’s disсussion of § 1292(c)(2) was not necessary to its holding on jurisdiction.” Johannsen v. Pay Less Drug Stores Nw., Inc.,
[Q]antification will be irrelevant if on appeal this Court determines that it was an abuse of discretion to award attorney fees at all. Accordingly, allowing the present appeal will prevent the loss of time and expense, and the need to explore what sometimes may be sensitive attorney records, in the event the case is overturned on the merits or in the determination that attorney fees should be awarded. Moreover, allowance of the appeal here fully harmonizes with the objectives of 28 U.S.C. § 1292(c)(2)....
My colleagues also mistakenly state that Majorette Toys was overturned or superseded by Swint v. County Chambers Commission,
In resolving questions of appealability, considerations of judicial efficiency and economy are routinely at the forefront. See Intermedics Infusaid, Inc. v. The Regents of the University of Minnesota,
An interlocutory order that ordinarily would not be appealable may be given discretionary appellate review when it is ancillary to other matters that are appealable .... Consideration, is given to the extent to which the appealable order involves factors pertinent to the otherwise nonappealable order, such that judicial efficiency and the interest of justice are served by review.
These considerations remain important, as this court recognized six years after Swint, in Special Devices:
From the very foundation of our judicial system the object and policy of the acts of Congress in relation to appeals and writs of error ... have been to save the expense and delays of repeated appeals in the same suit, and to have the whole case and every matter in controversy in it decided in a single appeal.
The regional circuits also continue to recognize the important role of еfficiency considerations in decisions on pendent appealability after Swint, both within and outside the context of attorney fees. See, e.g., Mueller v. Auker,
Well after Swint, leading commentators continue to advocate reviewing an unquantified award of fees along with a final judgment on the merits, “whenever the circumstances suggest that obvious efficienсy advantages can be gained on appeal without interfering with ongoing proceedings in the trial court.” Wright & Miller, Federal Practice & Procedure § 3915.6. Commentators have correctly noted that “attorney fee questions often require substantial litigation before the district judge and turn on matters closely bound up with the judgment on the merits,” such that courts may “expand the scope of the appeal on the merits to permit review of a determination to award attorney fees even though the amount has not yet been set.” Id. As explained by Wright and Miller:
In extending review, commonly under the label of pendent jurisdiction, courts have tended to look for and to emphasize a strong relationship between the appealable order and the additional matters swept up into the appeal. Illustrations have been provided by appeals taken under a variety of expansive finality theories. Perhaps the simplest setting is provided by review of an order awarding attorney fees on appeal from a judgment final with respeсt to all matters other than determination of the fee amount. The trial court, appellate court, and parties all may be better off if the appeal from an almost completely final judgment can resolve the fee issue as well.
Id. at § 3937.
In White v. New Hampshire Department of Employment Security,
Contrary to the majority’s argument, Swint does not support the panel majority’s ruling, and did not overrule or supersede Majorette Toys. In Swint, in the wаke of successive raids on a nightclub in Chambers County Alabama, the plaintiffs
Swint is distinguished from this case, and from Majorette Toys, for at least three reasons. First, as recognized by the Court, the commission’s appeal in Swint was “unrelated” to the individual defendants’ qualified immunity appeal, such that no efficiency would be gained by consolidated review.
Here, by contrast, Mr. Orenshteyn’s appeal is from the final judgment on the merits of a patent infringement action, and the sanction is for his prosecution of the merits; the issues are closely linked and entwined, such that efficiency counsels in favor of consolidated appeal. See Greenwell,
Second, there was no final judgment in Swint; the qualified immunity decision was only appealable under the collateral order doctrine, which the Court explained as follows:
In Cohen [v. Beneficial Indus. Loan Corp.,337 U.S. 541 ,69 S.Ct. 1221 ,93 L.Ed. 1528 (1949)], we held that § 1291 permits appeals not only from a final decision by which a district court disassociates itself from a case, but also from a small category of decisions that, although they do not end the litigation, must nonetheless be considered “final.” Id. at 546 [69 S.Ct. 1221 ]. That small category includes only decisions that are conclusive, that resolve important questions separate from the merits, and that are effectively unreviewable on appeal from the final judgment in the underlying action. Ibid.
If courts of appeals had discretion to append to a CoAew-authorized appeal from a collateral order further rulings of a kind neither independently appealable nor certified by the district court, then the two-tiered arrangement § 1292(b) mandates would be severely undermined.
Third, the Court in Swint considered “pendent party” appellate jurisdiction, and the Court emphasized that point:
In the instant case, the Eleventh Circuit asserted not merely pendent appellate jurisdiction, but pendent party appellate jurisdiction: The court appended to its jurisdiction to review the denial of the individual defendants’ qualified immunity motions jurisdiction to review the denial of the commission’s summary judgment motion.
The issue here is not whether to review a non-final deсision against one defendant, along with a largely unrelated interlocutory decision against a different defendant appealable only under the collateral order doctrine, but whether to permit inclusion of the sanction levied against Mr. Orenshteyn along with appeal of the final judgment against Mr. Orenshteyn. The Court in Swint explicitly narrowed its ruling, stating that it “need not definitively or preemptively settle here whether or when it may be proper for a court of appeals, with jurisdiction over one ruling, to review, conjunctively, related rulings that are not themselves independently appealable.” Id. at 50-51,
The majority states that Swint is “widely considered to have thrown ‘cold water
Swint did not hold, as the majority contends, that pendent appellate jurisdiction is proper only where the issues are “inextricably intertwined,” or where review of one is “necessary to review” the other. Maj. op. at 1358-59. See Gilda Marx, Inc. v. Wildwood Exercise,
The majority’s mistake is apparent when the relevant language from Swint is shown in context:
We need not definitively or preemptively settle here whether or when it may be proper for a court of appeals, with jurisdiction over one ruling, to review, conjunctively, related rulings that are not thеmselves independently appeal-able .... The parties do not contend that the District Court’s decision to deny the Chambers County Commission’s summary judgment motion was inextricably intertwined with that court’s decision to deny the individual defendants’ qualified immunity motions, or that review of the former decision was necessary to ensure meaningful review of the latter. Cf. Kanji, The Proper Scope of Pendent Appellate Jurisdiction in the Collateral Order Context, 100 Yale L.J. 511, 530 (1990) (“Only where essential to the resolution of properly appealed collateral orders should courts extend their Cohen jurisdiction to rulings that would not otherwise qualify for expedited consideration.”). Nor could the parties so argue. The individual defendants’ qualified immunity turns on whether they violated clearly established federal law; the county commission’s liability turns on the allocation of law enforcement power in Alabama.
Swint,
Further, the citation following the sentence from which the majority derives its “test” is to a law review article on “the proper scope of pendent appellate jurisdiction in the collateral order context,” and the quotation from that article opines on when courts should “extend their Cohen jurisdiction to rulings that would not otherwise qualify.” The final sentence in the paragraph emphasizes the lack of relation between the issues underlying the two appeals. Thus Swint held, in the pendent party context, that an appellate court may not extend its Cohen jurisdiction to reach an “unrelated question.” Id. at 51,
Courts have not limited pendent appellate jurisdiction to the conditions of the majority’s test. This court сontinues to exercise pendent appellate jurisdiction where the issues are “closely interrelated factually,” as they are here. See, e.g., Helifix Ltd. v. Blok-Lok, Ltd.,
Nor do the regional circuits limit themselves to the conditions of the majority’s test. The regional circuits continue to recognize and apply pendent appellate jurisdiction after Swint in situations such as this, where doing so “furthers interests of fairness and efficiency,” or where the issues are “closely related,” “entwined,” or “involve overlapping issues of law and fact.” See, e.g., Mueller,
The majority is incorrect in stating that the circuits “are in general agreement that an unquantified award of attorney fees does not usually warrant the exercise of pendent jurisdiction.” Maj. op. at 1360. Numerous courts, including this court, have reviewed unquantified fee awards since Swint, or recognized the power to do so. See, e.g., Akron Polymer,
In contrast with the cases selected by the panel majority, Mr. Orenshteyn’s appeal is from the final judgment on the merits of the patent, and the sanction is for his prosecution of the merits. Majorette Toys is controlling precedent,
The panel majority has chosen to accept only the portion of the appeal relating to
As now postured by the panel majority, this court will review only the summary judgment of patent invalidity. Meanwhile, the district court will be ordered to return to the case and perform the accounting— without knowing the views of the Federal Circuit on the foundation of the sanction or its scope. Judicial efficiency is adversely affected not only for the Federal Circuit, but also for the district court. However, this burden is avoided if this court simply follows precedent and reviews the appealed sanction along with the appealed final judgment.
But for the recent aberration in Falana, see n.2 supra, Federal Circuit precedent has been consistent. In Majorette Toys, and in Akron Polymer, the court received appeal of a final judgment on the merits, and accepted the accompanying appeal of the sanction although the monetary amount of the sanction had not been determined. And where the unquantified sanction was the only issue on appeal, as in View Engineering and Special Devices, the court held that the issue was not ripe for appeal. Precedent and efficiency support acceptance of this appeal of the merits together with the sanction.
Notes
. The majority sees "no basis upon which to limit Swint only to pendent party jurisdiction.” Maj. op. at 1362. Swint is not limited "only to pendent party jurisdiction,” but this is one of the three important bases for distinguishing this case and Majorette Toys from Swint, as explained supra.
. I take note of the recent decision in Falana v. Kent State Univ.,