Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-12-17805/USCOURTS-ca9-12-17805-0/pdf.json

Parties Involved:
Apple Inc.
Appellee
Thomas Buchar
Appellant
Zack Ward
Appellant

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ZACK WARD; THOMAS BUCHAR, on

behalf of themselves and all others

similarly situated,

Plaintiffs-Appellants,

v.

APPLE INC.,

Defendant-Appellee.

No. 12-17805

D.C. No.

4:12-cv-05404-

YGR

OPINION

Appeal from the United States District Court

for the Northern District of California

Yvonne Gonzalez Rogers, District Judge, Presiding

Argued and Submitted

January 16, 2015—San Francisco California

Filed June 29, 2015

Before: J. Clifford Wallace, Milan D. Smith, Jr.,

and Michelle T. Friedland, Circuit Judges.

Opinion by Judge Milan D. Smith, Jr.;

Dissent by Judge Wallace

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2 WARD V. APPLE, INC.

SUMMARY*

Antitrust/Appellate Jurisdiction

The panel reversed the district court’s dismissal of an

antitrust action for failure to join an alleged co-conspirator as

a defendant.

Plaintiffs filed a putative class action against Apple, Inc.,

alleging that Apple conspired with AT&T Mobility (ATTM)

to violate federal antitrust law in connection with Apple’s

agreement with ATTM that ATTM would be the exclusive

provider of voice and data services for Apple’s iPhone. The

district court dismissed plaintiffs’ claims under Federal Rule

of Civil Procedure 19 for failure to join ATTM as a

defendant.

The panel held that it had jurisdiction under 28 U.S.C.

§ 1291 over plaintiffs’ appeal from a final decision of the

district court even though the current case, Apple III, had

been consolidated with another case, Apple II, in which the

district court had dismissed a voice and data aftermarket

monopolization claim for failure to join ATTM as a party. 

The panel held that even though the parties in Apple III had

stipulated to submit the Apple II briefs on the Rule 19 issue

and had agreed that the district court should grant Apple’s

motion to dismiss if it decided to follow the decision in Apple

II, the district court’s judgment was adverse to plaintiffs and

thus appealable.

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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WARD V. APPLE, INC. 3

On the merits, the panel held that the district court abused

its discretion in finding that ATTM, an alleged antitrust

coconspirator, was a necessary party under Rule 19. The

panel held that although the allegation that an entity is a joint

tortfeasor with the defendant does not mean the entity must

be joined in one action under Rule 19(a)(1)(A), there may be

circumstances in which an alleged joint tortfeasor has

particular interests that cannot be protected in a legal action

unless it is joined under Rule 19(a)(1)(B). The panel

concluded that ATTM was not a required party under Rule

19(a)(1)(A), but the district court abused its discretion by

failing to identify ATTM’s interests in this action, or address

how those interests, if any, might be impaired if this action

were resolved in its absence, as required byRule 19(a)(1)(B). 

In addition, the record did not disclose whether ATTM had an

interest that was entitled to protection under Rule 19. The

panel remanded the case to the district court for further

proceedings.

Dissenting, Judge Wallace wrote that the court of appeals

lacked statutory appellate jurisdiction because the district

court’s decision was not involuntary or adverse to plaintiffs. 

He wrote that even if the court had statutory jurisdiction, he

would conclude that plaintiffs waived the Rule 19 issue by

inviting the district court to adopt the very analysis they

argued against on appeal.

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4 WARD V. APPLE, INC.

COUNSEL

Mark C. Rifkin (argued), Alexander H. Schmidt, and Michael

Liskow, Wolf Haldenstein Adler Freeman & Herz LLP, New

York, New York; Francis M. Gregorek and Rachele R.

Rickert, Wolf Haldenstein Adler Freeman & Herz LLP, San

Diego, California; Randall S. Newman, Randall S. Newman

P.C., New York, New York, for Plaintiff-Appellant Zack

Ward.

Adam J. Levitt, Grant & Eisenhofer P.A., Chicago, Illinois,

for Plaintiff-Appellant Thomas Buchar.

Daniel M. Wall (argued) and Christopher S. Yates, Latham &

Watkins LLP, San Francisco, California; J. Scott Ballenger

and Roman Martinez, Latham & Watkins LLP, Washington,

D.C., for Defendant-Appellee.

OPINION

M. SMITH, Circuit Judge:

Zack Ward and Thomas Buchar (Plaintiffs) filed a

putative class action against Apple Inc. (Apple), alleging that

Apple conspired with AT&T Mobility (ATTM) to violate

federal antitrust laws. The Plaintiffs’ claims relate to Apple’s

exclusivity agreement with ATTM that ATTM would be the

exclusive provider of voice and data services for Apple’s

iPhone. The Plaintiffs appeal from the district court’s order

dismissing their claims under Federal Rule of Civil Procedure

19 for failure to join ATTM as a defendant.

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WARD V. APPLE, INC. 5

In this opinion, we consider the contours of the general

rule that antitrust co-conspirators need not be joined in one

action. The Plaintiffs argue that the district court’s

determination that ATTM was a required party under Rule 19

runs counter to this rule. The Plaintiffs also contend that,

even if ATTM could otherwise qualify as a required party,

Apple has not shown that ATTM actually asserts any interests

in this action, or that its interests warrant protection under

Rule 19.

We reverse the district court’s judgment, and remand for

further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

This appeal is from the third of three related putative class

actions asserting antitrust claims against Apple in connection

with its exclusivity agreement (Exclusivity Agreement) with

ATTM.

I. Antitrust Allegations

Apple began selling the iPhone in June of 2007. Apple

entered into an agreement with ATTM that ATTM would be

the exclusive provider of voice and data services for the

iPhone for five years. The Plaintiffs allege that Apple

installed “software locks” on each iPhone it sold in order to

enforce ATTM’s exclusivity. These locks prevented ATTM

customers who used iPhones from switching to voice and

data services providers who competed with ATTM. The

Plaintiffs allege that they were not informed that they would

be locked into ATTM’s services for five years. They further

allege that the Exclusivity Agreement enabled ATTM to

charge supra-competitive prices for wireless services, and

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6 WARD V. APPLE, INC.

that Apple shared in ATTM’s revenues pursuant to the

Exclusivity Agreement.

II. Apple I

Nine Apple customers filed putative class actions against

Apple and ATTM in the Northern District of California in the

summer and fall of 2007. These actions were consolidated

before Judge Ware as In re Apple AT&TM Anti-Trust

Litigation, No. 5:07-cv-05152-JW (N.D. Cal.) (Apple I). The

plaintiffs in Apple I asserted claims under § 2 of the Sherman

Act, 15 U.S.C. § 2, among other claims.

In 2008 and 2009, the district court denied motions by

Apple and ATTM to dismiss the plaintiffs’ antitrust claims. 

The district court certified a class on July 8, 2010.

ATTM sought to compel arbitration pursuant to an

agreement it entered into with its wireless customers. The

district court denied the motion, citing the then-applicable

Discover Bank rule. 596 F. Supp. 2d 1288, 1297–99 (N.D.

Cal. 2008) (citing Discover Bank v. Superior Court, 36 Cal.

4th 148 (2005) (holding that, under some circumstances, class

action waivers in consumer arbitration agreements are

unconscionable)). In 2011, following the Supreme Court’s

decision in AT&T Mobility LLC v. Concepcion, 131 S. Ct.

1740 (2011), which abrogated Discover Bank, ATTM

renewed its motion to compel arbitration. Apple also moved

to compel arbitration under ATTM’s agreement.

The district court granted both ATTM’s and Apple’s

motions to compel arbitration. 826 F. Supp. 2d 1168, 1179

(N.D. Cal. 2011). It held that because the plaintiffs asserted

claims arising out of their agreements with ATTM, which

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WARD V. APPLE, INC. 7

contained arbitration clauses, the plaintiffs were “equitably

estopped” from refusing to arbitrate “jointly” against ATTM

and Apple. Id. at 1178–79.

III. Apple II

In 2011 and 2012, two new groups of Apple customers

filed class action complaints in the Northern District of

California. These actions were consolidated by Judge Ware

as In re Apple iPhone Antitrust Litigation, No. 4:11-cv06714-YGR (N.D. Cal.) (Apple II). The consolidated

complaint in Apple II alleged antitrust claims that were

similar to the claims in Apple I. However, unlike in Apple I,

ATTM was not named as a defendant in Apple II. Apple

moved to compel arbitration on the same grounds it asserted

in Apple I. The district court denied Apple’s motion, finding

that the plaintiffs were not equitably estopped from refusing

to arbitrate their claims against Apple. Unlike the Apple I

plaintiffs, the court reasoned, the Apple II plaintiffs had pled

their claims against Apple alone, without “intertwining” them

with ATTM’s wireless service agreement. 874 F. Supp. 2d

889, 898–99 (N.D. Cal. 2012).

Apple also sought dismissal under Rule 12(b)(7), arguing

that ATTM was a required party under Rule 19. Id. at 899. 

In support of its motion, Apple submitted a declaration from

ATTM’s counsel from the Apple I litigation. The declaration

stated, in pertinent part:

ATTM is aware of this litigation . . . . ATTM

has an interest in this case, since the

Consolidated Complaint alleges that ATTM is

a monopolist and makes various allegations

regarding the service ATTM provides to

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8 WARD V. APPLE, INC.

ATTM customers using iPhones . . . .

However, ATTM has not intervened in this

suit because, given the ruling in [Apple I], any

such claims must be arbitrated. If ATTM

were to be joined to this litigation, ATTM

would move to compel arbitration . . . .

In response, the district court held that ATTM was a

necessary party. The court reasoned:

[I]n order to evaluate Plaintiffs’ antitrust

claims in regard to the alleged conspiracy to

monopolize the alleged iPhone Voice and

Data Services Aftermarket, the Court will be

required to evaluate ATTM’s conduct, insofar

as Plaintiffs allege, inter alia, that ATTM

unlawfully achieved market power in that

Aftermarket due to the conspiracyand thereby

foreclosed other companies from entering the

market. . . . Such an evaluation of ATTM’s

conduct would necessarily implicate the

interests of ATTM, which means that ATTM

is a necessary party pursuant to Rule 19(a).

Id. at 900 (citing Laker Airways, Inc. v. British Airways, PLC,

182 F.3d 843, 847–48 (11th Cir. 1999)). The district court

ordered that the claim relating to monopolization of the voice

and data aftermarket be dropped if ATTM was not joined. 

See id. at 902 n.29. Shortly thereafter, Apple II was

reassigned to Judge Yvonne Gonzalez Rogers. The plaintiffs

declined to join ATTM as a party in their amended complaint,

which resulted in the dismissal of their voice and data

aftermarket monopolization claim.

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WARD V. APPLE, INC. 9

IV. Apple III

On October 19, 2012, the present Plaintiffs initiated this

putative class action against Apple in Ward v. Apple Inc.,

4:12-cv-05404-YGR (N.D. Cal.) (Apple III), asserting a

single claim that Apple conspired to monopolize the

aftermarket for iPhone voice and data services. ATTM was

not named as a defendant. The case was consolidated with

Apple II. The parties in Apple III stipulated to submit the

Apple II briefs on the Rule 19 issue, and agreed that the

district court should grant Apple’s motion to dismiss under

Rule 12(b)(7) if the court decided to follow Judge Ware’s

decision in Apple II. The district court granted the motion

“for the reasons set forth in Judge Ware’s July 11, 2012

Order,” and entered judgment in favor of Apple. The

Plaintiffs filed a timely notice of appeal.

JURISDICTION AND STANDARD OF REVIEW

We have appellate jurisdiction under 28 U.S.C. § 1291

because this is an appeal from a final decision of the district

court. We respectfully disagree with the dissent’s conclusion

that the judgment below was not “adverse” to the Plaintiffs,

as our case law has defined that term.

The dissent contends that we “only” have jurisdiction

over appeals from final decisions of the district court that are

“involuntary and adverse to the appellant.” This statement of

our law is too broad. We have repeatedly recognized that

voluntary dismissals with prejudice that produce an adverse

final judgment may be appealed. See Berger v. Home Depot

USA, Inc., 741 F.3d 1061, 1065 (9th Cir. 2014); Concha v.

London, 62 F.3d 1493, 1506–09 (9th Cir. 1995); Unioil, Inc.

v. E.F. Hutton & Co., 809 F.2d 548, 556 (9th Cir. 1986);

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10 WARD V. APPLE, INC.

Coursen v. A.H. Robins Co., 764 F.2d 1329, 1342, corrected,

773 F.2d 1049 (9th Cir. 1985). It is true that our decision in

Seidman v. City of Beverly Hills, 785 F.2d 1447, 1448 (9th

Cir. 1986), contained broad language stating that “[a] plaintiff

may not appeal a voluntary dismissal because it is not an

involuntary adverse judgment against him.” However, our

decision in Concha v. London clarified that a plaintiff “may

appeal from a voluntary dismissal with prejudice, at least

where the plaintiff is not acting pursuant to a settlement

agreement intended to terminate the litigation.” 62 F.3d at

1057 (emphasis omitted). In doing so, Concha specifically

interpreted Seidman to stand for the narrower principle that

a plaintiff may not “appeal from a joint stipulation to

voluntary dismissal, entered unconditionally by the court

pursuant to a settlement agreement.” Id. (emphasis added). 

And, as the dissent acknowledges, we held in Berger v. Home

Depot USA, Inc. that “absent a settlement, a stipulation alone

does not destroy [the] adversity” required for appellate

jurisdiction. 741 F.3d at 1065.

The dissent’s conclusion that this judgment was not

adverse to the Plaintiffs appears to be based, in part, on a

definition of “adverse” that is without basis in our case law

concerning statutory appellate jurisdiction. The dissent

contends that a judgment is not adverse if “no adverse

positions were taken by the parties” or if the issue was not

“actually litigated.” The dissent appears to understand

“adverse” to refer to whether the proceedings were

sufficiently adversarial. Of course, parties must be

sufficiently adverse to one another for a justiciable

controversy to exist, see, e.g., United States v. Johnson,

319 U.S. 302, 304–05 (1943), but we do not understand the

dissent to argue that this appeal is non-justiciable because it

lacks sufficient adversity for Article III purposes, but rather

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WARD V. APPLE, INC. 11

only that we lack statutory appellate jurisdiction. In

construing our statutory jurisdiction, we have consistently

used the term “adverse” to refer to whether a judgment was

prejudicial to a party, not whether the parties took sufficiently

adverse positions. For example, in Concha v. London we

explained that

[u]nder Coursen and Unioil, the appealability

of a voluntary dismissal ordinarily depends on

whether the action was dismissed with or

without prejudice. The basic principle we

follow is that the plaintiff may appeal a

voluntary dismissal only when it is with

prejudice to his right to commence another

action for the same cause or otherwise

subjects him to prejudicial terms or

conditions.

62 F.3d at 1507. We went on to explain that “[a] voluntary

dismissal without prejudice is not adverse to the plaintiff’s

interests . . . [because] [t]he plaintiff is free to seek an

adjudication of the same issue at another time in the same or

another forum.” Id. By contrast, a voluntary dismissal with

prejudice is adverse to the plaintiff’s interests because “the

plaintiff submits to a judgment that serves to bar his claims

forever.” Id. The judgment in this case is adverse to the

Plaintiffs because it bars their claims in future proceedings. 

The requirement of an adverse judgment is therefore not a

barrier to appellate jurisdiction in this case.

Reading between the lines, the dissent appears to be

concerned that the parties effectively agreed with Judge

Rogers to manufacture appellate jurisdiction without

presenting the Rule 19 issue to her for an independent

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12 WARD V. APPLE, INC.

decision. But the record simply does not compel the

conclusion that Judge Rogers did not make an independent

decision here. The dissent infers from the record that Judge

Rogers “understood that the Plaintiffs were not asking her to

rule on the merits of the Rule 19 issue, but rather were

attempting only to create a vehicle for appellate review of

Judge Ware’s order . . . .” (emphasis omitted). However, the

Amended Joint Case Management Statement clearly

presented the Rule 19 issue as a decision for Judge Rogers to

make:

For the sake of efficiency, Plaintiffs have

proposed submitting to the Court the prior

briefing on Apple’s Motion to Dismiss

Plaintiffs’ Consolidated Complaint in the

related case, In re Apple iPhone Antitrust

Litigation . . . . Should the Court decide to

issue the same ruling in this case . . . .

Plaintiffs will stand on their existing

complaint and not add ATTM as a party. 

Therefore any such dismissal will become

final and immediately appealable to the Ninth

Circuit Court of Appeals.

At the subsequent case management conference, Judge

Rogers stated:

[I]t sounds like the issues that you’re asking

me to decide on both sides have already been

decided, so I don’t know why we’re going

through this process again. I don’t know why

we have another complaint that doesn’t

include as a defendant AT&T, which . . .

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WARD V. APPLE, INC. 13

Judge Ware told you you needed to have as a

. . . party to the litigation.

The dissent interprets these comments to mean that Judge

Rogers was “confused” initially about the “unusual

procedure” proposed by the parties. But Judge Rogers’s

comments could also be interpreted to mean that she had

analyzed the issue and was inclined to issue the same ruling

as Judge Ware. In deciding whether to dismiss the case,

Judge Rogers had the benefit of the Apple II briefing. By

signing the order dismissing the case with prejudice “for the

reasons set forth in Judge Ware’s July 12, 2012 Order,” Judge

Rogers issued a final decision on the merits. This was

sufficient to give us appellate jurisdiction to review the

decision.1

In sum, because we find that the judgment below was the

product of a final decision of the district court and was

adverse to the Plaintiffs, we are satisfied that we have

statutory jurisdiction.

We review the district court’s decision to dismiss for

failure to join an indispensable party for abuse of discretion. 

Dawavendewa v. Salt River Project Agric. Improvement &

Power Dist., 276 F.3d 1150, 1154 (9th Cir. 2002). However,

“[t]o the extent that the district court’s determination whether

a party’s interest is impaired involves a question of law, we

1 As for the dissent’s conclusion that the Plaintiffs waived the Rule 19

issue by “inviting Judge Rogers to adopt the very analysis that they now

allege on appeal was erroneous,” we note that Apple has not asserted a

waiver argument. See United States v. Scott, 705 F.3d 410, 415 (9th Cir.

2012) (“A party who fails to assert a waiver argument forfeits—and

therefore implicitly waives—that argument.”).

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14 WARD V. APPLE, INC.

review de novo.” Id. (quoting Pit River Home & Agric.

Coop. Ass’n v. United States, 30 F.3d 1088, 1098 (9th Cir.

1994)).

DISCUSSION

The Plaintiffs argue, on several grounds, that the district

court abused its discretion in finding that ATTM was a

necessary party under Rule 19. The Plaintiffs contend that

the district court’s decision runs counter to the general rule

that joint tortfeasors need not be joined in one action. The

Plaintiffs also assert that Apple has not shown that ATTM

claims any interest in this action because ATTM has stated

that it would seek to compel arbitration if joined, and because

ATTM has no contracts with Apple that might be affected by

this litigation. The Plaintiffs further argue that, even if

ATTM has claimed an interest in this action, Apple has not

shown that ATTM’s interests are “legally protected,” or that

they may be impaired by resolution of this action in ATTM’s

absence. Therefore, the Plaintiffs contend, it was error for the

district court to find that ATTM was a necessary party based

on its alleged role in the conspiracy without first specifying

which legally protected interests ATTM had in the action. 

We address these arguments in turn.

I. Joinder of Joint Tortfeasors under Rule 19

Under Rule 19, a “required party” must be joined as a

party in an action if doing so is “feasible.” Fed. R. Civ. P. 19. 

Rule 19(a)(1) defines “required party,” and establishes two

broad categories of required parties. First, under Rule

19(a)(1)(A), a party is required if “in that person’s absence,

the court cannot accord complete relief among existing

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WARD V. APPLE, INC. 15

parties.” Second, under Rule 19(a)(1)(B), a party is required

if:

that person claims an interest relating to the

subject of the action and is so situated that

disposing of the action in the person’s absence

may: (i) as a practical matter impair or impede

the person’s ability to protect the interest; or

(ii) leave an existing party subject to a

substantial risk of incurring double, multiple,

or otherwise inconsistent obligations because

of the interest.

According to Rule 19's text, two conditions must be

satisfied for a party to qualify as a “required party” under

Rule 19(a)(1)(B). First, the party must “claim[] an interest

relating to the subject of the action.” Fed. R. Civ. P.

19(a)(1)(B). Second, the party must be “so situated that

disposing of the action in the person’s absence” may have one

of the two consequences enumerated in Rule 19(a)(1)(B)(i)

and (a)(1)(B)(ii). There must either be a possibility that

disposing of the action in the person’s absence will “as a

practical matter impair or impede the person’s ability to

protect the interest,” or a possibility that doing so will “leave

an existing party subject to a substantial risk of incurring

double, multiple, or otherwise inconsistent obligations

because of the interest.”

The Plaintiffs argue that the district court’s decision runs

counter to the longstanding principle that joint tortfeasors

need not be joined in one action. For the reasons that follow,

we conclude that although the allegation that an entity is a

joint tortfeasor with the defendant does not mean the entity

must be joined in one action under Rule 19(a)(1)(A), there

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16 WARD V. APPLE, INC.

may be circumstances in which an alleged joint tortfeasor has

particular interests that cannot be protected in a legal action

unless it is joined under Rule 19(a)(1)(B). We therefore need

to analyze the facts of this case to determine whether ATTM

is a required party in this action under Rule 19(a)(1)(B).

“It has long been the rule that it is not necessary for all

joint tortfeasors to be named as defendants in a single

lawsuit.” Temple v. Synthes Corp., 498 U.S. 5, 7 (1990) (per

curiam); see also Fed. R. Civ. P. 19 advisory committee’s

note to 1966 amend. (noting that “a tortfeasor with the usual

‘joint-and-several’ liability is merely a permissive party to an

action against another with like liability”). Antitrust

conspirators are liable for the acts of their co-conspirators. 

United States v. Socony-Vacuum Oil Co., 310 U.S. 150,

253–54 (1940); Beltz Travel Serv., Inc. v. Int’l Air Transp.

Ass’n, 620 F.2d 1360, 1367 (9th Cir. 1980). It therefore

follows that a plaintiff is “not required to sue all of the

alleged conspirators inasmuch as antitrust coconspirators are

jointly and severally liable for all damages caused by the

conspiracy.” William Inglis & Sons Baking Co. v. ITT Cont’l

Baking Co., Inc., 668 F.2d 1014, 1053 (9th Cir. 1982); see

also Lawlor v. Nat’l Screen Serv. Corp., 349 U.S. 322, 330

(1955) (holding that joinder of alleged antitrust coconspirators was not mandatory “since as joint tort-feasors

they were not indispensable parties”); Georgia v. Penn. R.R.,

324 U.S. 439, 463 (1945) (“In a suit to enjoin a conspiracy

not all the conspirators are necessary parties . . . .”).

For this reason, an absent antitrust co-conspirator

generallywill not be a required party under Rule 19(a)(1)(A),

which applies only when a party’s absence prevents the court

from “accord[ing] complete relief among existing parties.” 

This case, for example, illustrates why according complete

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WARD V. APPLE, INC. 17

relief will usually be possible without joining an absent coconspirator like ATTM. If the Plaintiffs prevail, they will be

able to recover all of their damages from Apple alone, see

Socony-Vacuum, 310 U.S. at 253–54, without naming ATTM

as a party. Accordingly, ATTM is not a required party under

Rule 19(a)(1)(A).

It does not follow, however, that an absent antitrust coconspirator like ATTM cannot be a required party under Rule

19(a)(1)(B)(i), the purpose of which is to protect the interests

of absent parties. Stated differently, an absent party’s role as

a joint tortfeasor does not preclude it from having an interest

in the action that warrants protection. See Home Buyers

Warranty Corp. v. Hanna, 750 F.3d 427, 433–34 (4th Cir.

2014); Occidental Petroleum Corp. v. Buttes Gas & Oil Co.,

331 F. Supp. 92, 105–06 (C.D. Cal. 1971) (acknowledging

the general rule that “antitrust co-conspirators need not be

joined,” but observing that “[i]n the present case, [the coconspirator’s] status as a joint tortfeasor would not as a

practical matter negate its status as a contractual party, with

interests that are covered by Rule 19(a)”), aff’d, 461 F.2d

1261 (9th Cir. 1972) (per curiam). It is true that ATTM does

not face any damages exposure in this action. But our cases

have made it clear that, under some circumstances, the

equitable relief sought in an action may make an absent party

required under Rule 19(a)(1)(B)(i). See, e.g., Wilbur v.

Locke, 423 F.3d 1101, 1111–14 (9th Cir. 2005) (holding that

an Indian tribe was a necessary party to a suit seeking to

invalidate a contract to which it was a party), abrogated on

other grounds by Levin v. Commerce Energy, Inc., 560 U.S.

413 (2010); Manybeads v. United States, 209 F.3d 1164, 1166

(9thCir. 2000);Northrop Corp. v. McDonnell Douglas Corp.,

705 F.2d 1030, 1044 (9th Cir. 1983) (“[A]ll parties who may

be affected by a suit to set aside a contract must be present.”). 

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18 WARD V. APPLE, INC.

For this reason, ATTM’s role as an antitrust co-conspirator is

not alone dispositive of whether it has interests that warrant

protection under Rule 19(a)(1)(B)(i). Therefore, we must

analyze the particular facts here to determine whether ATTM

is a required party under Rule 19(a)(1)(B).

II. The District Court Erred by Failing to Specify the

Interests ATTM Claimed

The Plaintiffs next contend that the district court erred by

holding that ATTM was a required party without specifically

identifying ATTM’s interests or addressing how those

interests might be impaired if the action were resolved in its

absence. We agree, and conclude that the district court

abused its discretion by failing to identify ATTM’s interests

in this action, or address how those interests, if any, might be

impaired if this action were resolved in its absence, as

required by Rule 19(a)(1)(B).

As with any Rule 19(a)(1)(B) case, deciding whether an

absent joint tortfeasor is a required party requires identifying

the specific interest the absent party claims and determining

whether the party’s ability to protect that interest may be

impaired despite the fact that it has not been named as a party

in the action. Compare Wilbur, 423 F.3d at 1111–14 (holding

that an absent Indian tribe was a required party in an action to

invalidate a contract between the state and the tribe, and

finding that the state could not adequately protect the tribe’s

interests in the litigation), with Cachil Dehe Band of Wintun

Indians of the Colusa Indian Cmty. v. California, 547 F.3d

962, 970–72 (9th Cir. 2008) (holding that absent Indian tribes

were not required parties in an action asserting that the state

breached a tribal-gaming compact, in part because the absent

tribes’ interest did not “arise[] from terms in bargained

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WARD V. APPLE, INC. 19

contracts” (quoting Am. Greyhound Racing, Inc. v. Hull,

305 F.3d 1015, 1023 (9th Cir. 2002))).

We cannot discern whether the district court in Apple II

applied the requirements of Rule 19(a)(1)(B) when it

determined that ATTM was a required party. The court did

not identify any specific interest ATTM claimed in the action

or explain how ATTM’s ability to protect that interest might

be impaired by resolution of the action in its absence. 

Instead, the district court held that “if a plaintiff’s antitrust

claims require a court to evaluate the conduct of an absent

party that is alleged to be an antitrust co-conspirator with a

defendant, thereby substantially implicating [the] interests of

that party, the absent party is necessary pursuant to Rule

19(a).” In re Apple iPhone Antitrust Litig., 874 F. Supp. 2d

889, 899 (N.D. Cal. 2012) (alteration in original) (internal

quotation marks omitted). The court reasoned that it would

be “required to evaluate ATTM’s conduct,” and that “[s]uch

an evaluation . . . would necessarily implicate the interests of

ATTM, which means that ATTM is a necessary party

pursuant to Rule 19(a).” Id. at 900 (citing Laker Airways,

Inc. v. British Airways, PLC, 182 F.3d 843, 847–48 (11th Cir.

1999)). Thus, the court concluded, “because the alleged

conspiracy is with ATTM to monopolize or attempt to

monopolize the aftermarket for voice and data services, . . .

ATTM is a necessary party.” Id. at 901.

However, the fact that the complaint portrayed ATTM as

the central player in the alleged antitrust conspiracy does not

demonstrate that ATTM is a required party. Instead, whether

ATTM is a required party depends on whether ATTM’s

interests qualify for protection under Rule 19(a)(1)(B)(i). In

many cases, an absent antitrust co-conspirator will not have

interests that warrant protection under Rule 19(a)(1)(B)(i),

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20 WARD V. APPLE, INC.

even if it is alleged to have played a central role in the

conspiracy, and even if resolution of the action will require

the court to evaluate the absent party’s conduct. Therefore,

it is essential that courts identify the specific legally protected

interests an absent joint tortfeasor claims, and assess how

those interests may be impaired when, as a non-party, the

outcome of the action will not bind the absent party in future

proceedings. See Blonder-Tongue Labs., Inc. v. Univ. of Ill.

Found., 402 U.S. 313, 329 (1971). The district court abused

its discretion by failing to undertake this inquiry.

III. Whether the Record Supports a Finding That

ATTM Is a Required Party

Apple contends that, notwithstanding the district court’s

failure to specificallyenumerate ATTM’s interests, the record

supports a finding that ATTM is a required party under Rule

19(a)(1)(B). For the reasons that follow, we conclude that the

record does not disclose whether ATTM had an interest in

this action that was entitled to protection under Rule 19.

A. Whether ATTM Claims an Interest

The Plaintiffs contend that ATTM is not a required party

because it has not asserted any interest in this action. In

Bowen v. United States, 172 F.3d 682 (9th Cir. 1999), we

observed that “[j]oinder is ‘contingent . . . upon an initial

requirement that the absent party claim a legally protected

interest relating to the subject matter of the action,” id. at 689

(quoting Northrop Corp. v. McDonnell Douglas Corp.,

705 F.2d 1030, 1043 (9th Cir.1983)). As evidence that

ATTM has claimed an interest in this action, Apple cites a

declaration from ATTM’s counsel from Apple I, filed in

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WARD V. APPLE, INC. 21

support of Apple’s motion in Apple II.

2 The declaration

states: “ATTM is aware of this litigation” and “ATTM has an

interest in these claims . . . .” The declaration does not

indicate whether ATTM’s counsel from Apple I was

authorized to state ATTM’s position in Apple II or Apple III. 

Therefore, it is not perfectly clear whether ATTM has, in fact,

asserted an interest in this action.

We need not resolve whether the declaration satisfies

Bowen’s requirement that ATTM claim an interest. Even if

we assume that ATTM’s attorney from Apple I was

authorized to assert ATTM’s interests in this litigation, Apple

has not shown that the interests ATTM has purportedly

claimed are legally protected under Rule 19.

B. Whether There is Record Evidence that ATTM

Has Legally Protectable Interests under Rule 19

We turn now to Apple’s contention that ATTM has a

number of interests in this action that, assuming they were

claimed by ATTM, qualify for protection under Rule

19(a)(1)(B).

We have consistently held that only “legally protected”

interests warrant protection under Rule 19. See, e.g., Cachil

Dehe Band, 547 F.3d at 970 (observing that a “crucial

premise of mandatory joinder . . . is that the absent [party]

2 This declaration was again submitted in support of Apple’s motion to

dismiss in Apple III, and the parties stipulated that it referred to the

complaint in Apple III. Specifically, the parties stipulated that the

“supporting documents submitted by Apple in [Apple II] . . . shall be

deemed to refer to the Ward complaint and are properly before the Court

in connection with Apple’s motion to dismiss the Ward complaint.”

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22 WARD V. APPLE, INC.

possess[es] an interest in the pending litigation that is ‘legally

protected’”); Wilbur, 423 F.3d at 1112. We have offered

little guidance regarding which interests warrant legal

protection under Rule 19. We have clarified that “the interest

at stake need not be ‘property in the sense of the due process

clause.’” Cachil Dehe Band, 547 F.3d at 970 (quoting Am.

Greyhound Racing, 305 F.3d at 1023). And we have required

that the interest “be more than a financial stake, and more

than speculation about a future event.” Id. (internal quotation

marks omitted). “Within the wide boundaries set by these

general principles, we have emphasized the ‘practical’ and

‘fact-specific’ nature of the inquiry.” Id.

Apple has cited several interests of ATTM it contends

qualify as cognizable interests under Rule 19. Apple first

contends that ATTM faces a risk of collateral consequences

as a result of this litigation, including a risk of regulatory

scrutiny and harms to its reputation. Apple also contends that

ATTM has a number of contractual rights that may be

impaired if this action is resolved in its absence.

1. Risk of Regulatory Scrutiny

We have not had occasion to decide whether the risk that

an action will trigger regulatory scrutiny may give an absent

antitrust co-conspirator a legallyprotected interest under Rule

19(a). Without deciding whether such a risk might give an

absent party an interest under different circumstances, we

hold that Apple has not shown that the risk of regulatory

scrutiny ATTM faces as a result of this action gives ATTM

a legally protected interest.

Apple relies heavily on the Eleventh Circuit’s decision in

Laker Airways, Inc. v. British Airways PLC, 182 F.3d 843

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WARD V. APPLE, INC. 23

(11th Cir. 1999). In Laker Airways, the court considered

whether a private corporation appointed by the government

of the United Kingdom to coordinate airlines’ requests for

landing and take-off times was a necessary party to an action

alleging that the corporation conspired with an airline to

monopolize the market for passenger air service between two

cities. Id. at 845. The Eleventh Circuit held that the district

court had not abused its discretion when it found that the

coordinating corporation was a required party under Rule

19(a). Id.

In finding that the specific circumstances of the case

made the corporation’s interests “more significant than those

of a routine joint tortfeasor,” id. at 847–48, the court cited the

regulatory scrutiny the corporation could face as a result of

the litigation. Under the regulations of the United Kingdom,

the coordinating corporation was required to be

“independent,” and was to act in a “neutral, nondiscriminatory and transparent way.” Id. at 846. United

Kingdom law further provided that the corporation’s

appointment as coordinator would be withdrawn if the

corporation failed to act in an independent manner. Id. The

court reasoned:

[i]n order to prove its antitrust claims, [the

plaintiff] would be required to show that [the

defendant] acted in other “than an

independent manner.” Such a ruling would

surely implicate the interests of [the absent

corporation] because the United Kingdom’s

enabling legislation . . . requires that the

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24 WARD V. APPLE, INC.

Secretary of State for Transport withdraw its

approval of an appointed coordinator if its

behavior is not neutral.

Id. at 848.

Laker Airways is inapposite. There the relevant agency

was affirmativelyrequired to withdraw approval of the absent

coordinator if its behavior was not neutral. See id. By

contrast, there is no suggestion in this case that the collateral

regulatory consequences ATTM might face as a result of this

action would be any more severe, or likely to occur, than in

a typical case alleging an antitrust conspiracy. If the vague

risk of increased regulatory scrutiny in this case made ATTM

a required party, absent antitrust co-conspirators would,

almost always, be required parties in a broad range of

antitrust cases. Such a result would eviscerate the general

rule that absent antitrust co-conspirators need not be joined in

one action. See Lawlor, 349 U.S. at 329; Georgia v. Penn.

R.R., 324 U.S. at 463. Moreover, we have been reluctant to

recognize legally protected interests based solely on

“[s]peculation about the occurrence of a future event.” See

Northrop Corp. v. McDonnell Douglas Corp., 705 F.2d 1030,

1046 (9th Cir. 1983) (“Speculation about the occurrence of a

future event ordinarily does not render all parties potentially

affected by that future event necessary or indispensable

parties under Rule 19.”); Cachil Dehe Band, 547 F.3d at 973

(holding that absent Indian tribes’ opportunity to obtain

licenses under gaming compact was not a legally protected

interest where the “likelihood of obtaining future licenses

[was] attenuated”). In the absence of any evidence that lawenforcement or regulatory agencies are presently scrutinizing

the Exclusivity Agreement, we decline to speculate whether

the outcome of this case will impact agencies’ enforcement

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WARD V. APPLE, INC. 25

decisions. For these reasons, we find that Apple has not

demonstrated that the risk of regulatory scrutiny gives ATTM

a legally protected interest in this action.

2. Reputational Interests

Apple next argues that ATTM is a required party because

this action may affect ATTM’s business or reputational

interests. This argument is similarly without merit.

We are aware of no cases holding that a joint tortfeasor’s

reputational interests alone may make it a required party

under Rule 19(a). A joint tortfeasor’s reputation generally

will be adversely impacted in any case accusing it of

wrongdoing. For this reason, recognizing a protected interest

in business reputation would significantly erode the general

rule that a plaintiff need not join all joint tortfeasors in one

action. Recognizing such an interest would also conflict with

our precedents holding that a protected interest under Rule 19

“must be more than a financial stake,” Cachil Dehe Band,

547 F.3d at 970 (quoting Makah, 910 F.2d at 558). We

conclude that ATTM’s reputational interests in this action are

not legally protected under Rule 19.

3. Contract Interests

Apple also asserts that ATTM’s contract rights give it a

legally protected interest in this action. For the reasons that

follow, we find that Apple has not demonstrated that ATTM

currently has any substantial contract rights that may be

impaired by resolution of this action.

Under some circumstances, an absent party’s contract

rights may give it a legally protected interest in an action. 

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26 WARD V. APPLE, INC.

See, e.g., Wilbur, 423 F.3d 1101; Am. Greyhound Racing, Inc.

v. Hull, 305 F.3d 1015, 1022–24 (9th Cir. 2002); Manybeads

v. United States, 209 F.3d 1164, 1166 (9th Cir. 2000). For

instance, it is well established that all parties to a contract are

necessary in an action to set aside the contract. See Wilbur,

423 F.3d at 1113 (citing cases). Our cases also establish that

an absent party may be required in an action seeking

equitable relief that would prevent a defendant from fulfilling

“substantial” contractual obligations to the absent party. See

Am. Greyhound Racing, 305 F.3d at 1023 (holding that absent

Indian tribes were necessary parties where “the interest of the

tribes arises from terms in bargained contracts, and the

interest is substantial”); Cachil Dehe Band, 547 F.3d at 970

(interpreting American Greyhound Racing, Inc. v. Hull to

“require[]” that the interest arising from terms in bargained

contracts be “substantial” to be legally protected). Cf.

Wilbur, 423 F.3d at 1113 (“[I]t is a fundamental principle that

a party to a contract is necessary, and if not susceptible to

joinder, indispensable to litigation seeking to decimate that

contract.” (internal quotation marks omitted)). We have not,

however, held that an absent party is always required when

the relief sought in an action merely implicates an absent

party’s contract rights. See Cachil Dehe Band, 547 F.3d at

970 (“[A]n interest that ‘arises from terms in bargained

contracts’ may be protected . . . .” (emphasis added)).

Apple cites three contract interests of ATTM it contends

may be impaired if the action is resolved in ATTM’s absence:

(1) ATTM’s right to control unlock codes; (2) rights arising

from ATTM’s Wireless Service Agreement (WSA) with

customers; and (3) ATTM’s arbitration provisions in the

WSA.

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WARD V. APPLE, INC. 27

a. Right to Control Unlock Codes

The Plaintiffs seek a judgment “[o]rdering Apple to

provide the unlock code upon request to all members of the

Class . . . .” Apple contends that this injunctive relief would

conflict with ATTM’s purported contractual right to prevent

Apple from unlocking ATTM customers’ iPhones. As a

threshold matter, we must determine whether the record

supports a finding that ATTM currently has such a right. The

only possible sources of this right in the record are brief

excerpts of agreements between Apple and ATTM from 2006

and 2011, and the right is not embodied therein.

We begin with the excerpt from the 2006 agreement. The

limited excerpt in the record clearly states that any right of

ATTM to control unlock codes was only to last during the

“Term and the Wind-Down Period.” As Apple’s counsel

conceded at oral argument, there is nothing in the record

defining the term or wind-down period. Without a definition

of the term or wind-down period, we cannot determine

whether ATTM still has the right Apple claims it has. We

therefore find that the excerpt of the 2006 agreement does not

demonstrate that ATTM has any existing right to control

unlock codes.

We next turn to the excerpt of the 2011 agreement. The

first clause of this excerpt appears to condition Apple’s

obligation not to unlock iPhones on its use of a SIM solution

not offered by AT&T’s SIM suppliers. There is no evidence

in the record that Apple ever employed such a solution. In

the absence of such evidence, we cannot determine whether

ATTM currently has a right to control unlock codes, and

cannot find that injunctive relief ordering Apple to disclose

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28 WARD V. APPLE, INC.

unlock codes would impair ATTM’s rights under its contracts

with Apple.3

b. Interests Arising from Wireless Service

Agreements with Customers

Apple next contends that “the District Court will . . .

inevitably have to interpret the terms of ATTM’s WSA with

consumers, in ways that could affect and impair ATTM’s

rights under that contract.” We reject this argument.

The district court’s decision in Apple II undercuts Apple’s

contention that interpretation of ATTM’s WSA is

“inevitable.” The district court explicitly noted that “[the]

Plaintiffs have not contended that any of their claims arise

from ATTM service contracts,” 874 F. Supp. 2d at 899, and

declined to “reach the question of whether [the] Plaintiffs

must rely upon the WSA to advance any or all of their

claims,” id. at n.21.

Moreover, even if the district court ultimately interprets

these WSAs, ATTM, as a non-party, will not be bound by the

district court’s interpretation in subsequent proceedings. See

Blonder-Tongue Labs., Inc. v. Univ. of Ill. Found., 402 U.S.

313, 329 (1971) (“Some litigants—those who never appeared

in a prior action—may not be collaterally estopped without

litigating the issue. They have never had a chance to present

their evidence and arguments on the claim. Due process

3 Even if ATTM has some lingering contract interests, it may be

appropriate for the district court to exercise its discretion to fashion the

equitable relief in a way that avoids interfering with those interests,

instead of dismissing the entire action. See Occidental Petroleum Corp.

v. Buttes Gas & Oil Co., 331 F. Supp. 92, 105–06 (C.D. Cal. 1971).

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WARD V. APPLE, INC. 29

prohibits estopping them despite one or more existing

adjudications of the identical issue which stand squarely

against their position.”).

Lastly, we note that there is no copy of ATTM’s WSA in

the record. It is therefore unclear what rights ATTM had

under the WSA that might be affected by this action. Nor is

there any evidence in the record suggesting that class

members are still bound by the WSAs they signed during the

class period. The complaint seeks certification of a class of

consumers who “purchased wireless voice and data services

for the iPhone from October 19, 2008, through February 3,

2011.” It is plausible that, more than four years after the last

WSA in the class period was signed, many class members

have entered into new WSAs with ATTM or other carriers.

In sum, the record does not disclose whether ATTM’s

WSAs with customers give it a legally protected interest in

this action.

c. ATTM’s Arbitration Agreement

Apple also contends that ATTM has an interest in this

action because the district court will have to construe the

arbitration provisions in the WSA. This argument is likewise

without merit.

As long as ATTM is not a party, any construction of the

arbitration clause will likely focus on whether Apple may use

ATTM’s arbitration clause for Apple’s benefit. See 874 F.

Supp. 2d at 898–99 (holding that Apple, as a non-signatory to

the arbitration agreement, did not satisfy the requirements to

invoke the doctrine of equitable estoppel, and declining to

compel the plaintiffs to arbitrate their claims against Apple). 

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30 WARD V. APPLE, INC.

ATTM does not have a legally protected interest in whether

Apple may compel arbitration. Nor will the district court’s

construction of the arbitration clause bind ATTM, a nonparty, in future actions. See Blonder-Tongue, 402 U.S. at

329.

For the above reasons, we hold that Apple has not

demonstrated that ATTM has a legally protected interest in

this action.

IV. Motion to Dismiss for Failure to State a Claim

Apple also contends that dismissal is appropriate because

the Plaintiffs have failed to adequately plead a claim that

ATTM had monopoly power in a relevant market. We

decline to decide this issue.

The parties stipulated that the district court could enter an

order dismissing the case with prejudice for failure to join a

necessary party. The district court entered the parties’

stipulated order “grant[ing], with prejudice, Apple’s motion

to dismiss [the] Plaintiffs’ Complaint pursuant to Rule

12(b)(7) of the Federal Rules of Civil Procedure.” The

stipulated order did not address Apple’s Rule 12(b)(6)

argument, or even acknowledge that Apple sought dismissal

in Apple III on this ground. Because the district court in

Apple III has not ruled on Apple’s Rule 12(b)(6) motion, we

decline to consider whether the Plaintiffs’ complaint pleads

a claim.

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WARD V. APPLE, INC. 31

CONCLUSION

For the above reasons, we reverse the judgment of the

district court, and remand to the district court for further

proceedings.

REVERSED AND REMANDED.

WALLACE, Circuit Judge, dissenting:

I respectfully dissent. I would not reach the merits of this

appeal because, in my view, we lack jurisdiction to do so.

Even if we had jurisdiction, however, I would still decline to

reach the merits because the plaintiffs waived any challenge

to the errors they now allege on appeal.

I.

This case comes to us in a unique procedural posture. For

context, I begin with some background on an earlier case,

referenced by the majority as “Apple II.” Apple II involved a

different set of plaintiffs and a broader set of claims before

Judge Ware than those in Apple III, which were before Judge

Rogers, and are now before us on appeal.

The Apple II Plaintiffs were the first to raise the Rule 19

arguments we now see in the present appeal. But Judge Ware

was unpersuaded and ruled against the Apple II Plaintiffs. The

record indicates that Judge Ware’s July 11 order did not

address at least some of the arguments made in the Apple II

Plaintiffs’ opposition (and which the Apple III Plaintiffs raise

here on appeal), including the argument that ATTM itself

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32 WARD V. APPLE, INC.

failed to claim an interest in the litigation, and that any

claimed interest was not “cognizable” under Rule 19. Instead

of addressing those arguments, Judge Ware’s order relied

heavily on the Eleventh Circuit’s Laker Airways case in

holding that ATTM was a necessary party under Rule 19

because “the Court will be required to evaluate ATTM’s

conduct.”

The Apple II Plaintiffs disagreed with Judge Ware’s Rule

19 order. They wanted to appeal from it. But given the

interlocutory nature of Judge Ware’s ruling, they were

required to wait for a final judgment. The Apple II Plaintiffs

did not want to wait, however. In fact, waiting would have

been pointless because the Apple II Plaintiffs’ entire litigation

hinged on whether ATTM was a necessary party: if ATTM

was required to be joined as a necessary party, individual

arbitration was almost inevitable; but if ATTM was not

required to be joined, Plaintiffs’ case would likely proceed

through financially feasible class-action litigation. So,

Plaintiffs needed a way to (1) sever any claims that could

possibly implicate ATTM (to avoid arbitration), and

(2) obtain immediate appellate review of Judge Ware’s Rule

19 analysis for the claims that could implicate ATTM. In the

words of Plaintiffs’ counsel, “by keeping the [voice and data]

claims together [with the apps claims], we couldn’t get the

appellate review of the voice and data dismissal until we

finish the apps case.”

Accordingly, Plaintiffs’ counsel devised a strategy: a new

set of Plaintiffs (Apple III Plaintiffs) would bring a separate

action (Apple III) to “segregate the voice and data claims into

Apple III and have only the apps claims left in Apple II.” The

premise behind creating the new action, rather than appealing

directly from Judge Ware’s ruling in Apple II, was to enhance

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WARD V. APPLE, INC. 33

the Apple II Plaintiffs’ litigation position on appeal. This was

done by excising from Apple II any claims that arguably

implicated ATTM’s interests. The Apple III Plaintiffs

believed that by removing the voice and data claims—which

arguably implicated ATTM’s wireless service—from Apple

II, “Apple II [could] now proceed strictly as an apps case

[without implicating ATTM] and . . . Apple III [could] go

ahead and be dismissed so that [the Apple III Plaintiffs could]

take [Judge Ware’s] Rule 19 ruling up to the Ninth Circuit.”

But the Apple III Plaintiffs encountered a problem with

this strategy. Because they were not the parties aggrieved by

Judge Ware’s Apple II order, they could not appeal from it.

They needed Judge Rogers to issue an adverse ruling against

them—in Apple III—from which they could appeal. In an

attempt to obtain such a ruling expeditiously (that is, without

litigating the issue before Judge Rogers) both parties

stipulated to import from Apple II all of their respective

pleadings and motions, and asked Judge Rogers to rule on

them as if they had been brought in the first instance in Apple

III. Understandably confused by this rather unusual

procedure, Judge Rogers told the parties that

it sounds like the issues that you’re asking me

to decide . . . have already been decided, so I

don’t know why we’re going through this

process again. I don’t know why we have

another complaint that doesn’t include as a

defendant [ATTM], which . . . Judge Ware

told you you needed to have as a . . . party to

the litigation. And if a judge in these

[previous] cases has ruled [on that issue] . . .

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34 WARD V. APPLE, INC.

then the law says you don’t get a second bite

at the apple . . . .1

Counsel for the Apple III Plaintiffs responded that they

had proceeded in this fashion “to limit . . . the amount of

work the court has to do, [and] to streamline things.” After

explaining in detail the procedural history from Apple I and

Apple II, counsel for the Apple III Plaintiffs told Judge

Rogers that the point of the new Apple III litigation was to

“create . . . a device” to achieve appellate review of Judge

Ware’s interlocutory order. That device, counsel explained,

was a stipulation to dismiss the Apple III Plaintiffs’ claims

with prejudice, but based on Judge Ware’sreasoning from the

prior case, without having Judge Rogers make that

determination anew as applied to them. In other words,

Plaintiffs’ counsel said that the Apple III Plaintiffs were

“willing to stipulate with Apple . . . that the complaint ought

to be dismissed based on Judge Ware’s . . . ruling in Apple II”

because they assumed “the court would issue the same ruling

it issued last time, which is that [ATTM] is a necessary and

indispensable party in Apple III.”

1 The majority apparently believes these particular comments do not

show that Judge Rogers was confused about why Plaintiffs were bringing

these issues again after Judge Ware had already ruled on them

(demonstrating a concern about claim and issue preclusion). The majority

thinks they “could also be interpreted to mean that she had analyzed the

issue and was inclined to issue the same ruling as Judge Ware.” With due

respect, nothing in these statements can plausibly be construed as

indicating that Judge Rogers had at this point deliberately analyzed the

Rule 19 issue, and they certainly cannot be construed as her inclination to

“issue the same ruling as Judge Ware.” Although our jurisdiction does not

depend on what is said in the give-and-take between counsel and judge at

an oral hearing, the transcript in this case, as will become apparent below,

strongly suggests that Judge Rogers never in fact made an independent

decision on the Rule 19 issue.

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WARD V. APPLE, INC. 35

Once JudgeRogers understood that the Plaintiffs were not

asking her to rule on the merits of the Rule 19 issue, but

rather were attempting only to create a vehicle for appellate

review of Judge Ware’s order, Judge Rogers directed the

parties to “come up with a plan” and to submit a stipulation

that they believed would achieve their goals. Counsel for the

Apple III Plaintiffs asked Judge Rogers if she would “prefer

a form of order that essentially grants the 12(b)(7) motion,”

but Judge Rogers, having earlier emphasized that the court

was “overwhelmed right now” and that she was “not

interested in doing busy work,” said that “[i]f the two of you

can work it out so that you both have what you need in the

record and all you really need is my signature,” “I would like

to just (indicating) . . . stamp something.” She concluded,

“unless there’s some dispute . . . then I don’t need to be

involved, [except] to just put my signature.”

The Apple III Plaintiffs later submitted a joint stipulation

to dismiss their claims under Rule 19 “[f]or the reasons set

forth in Judge Ware’s . . . Order” from Apple II. Judge

Rogers—as she had promised—then signed the proposed

order granting the dismissal “PURSUANT TO THE

PARTIES’ STIPULATION,” and “for the reasons set forth in

Judge Ware’s . . . Order.” This appeal followed.

II.

In my view, Plaintiffs’ stipulation strategy produced a

“final decision” that fails to invoke our statutory appellate

jurisdiction because it was not involuntary or adverse to the

Plaintiffs. We have statutory jurisdiction only over “appeals

from . . . final decisions of the district courts,” 28 U.S.C.

§ 1291, that are both involuntary and adverse to the appellant.

See Seidman v. City of Beverly Hills, 785 F.2d 1447, 1448

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36 WARD V. APPLE, INC.

(9th Cir. 1986); Unioil, Inc. v. E.F. Hutton & Co., 809 F.2d

548, 555 (9th Cir. 1986) (“To be appealable, an order must be

adverse to the appealing party. As a general rule, a plaintiff

may not appeal a voluntary dismissal because it is not an

involuntary adverse judgement against him.”), abrogated on

other grounds by Townsend v. Holman Consulting Corp.,

929 F.2d 1358 (9th Cir. 1990) (en banc).

We recently stated in Berger v. Home Depot USA, Inc.,

741 F.3d 1061, 1065 (9th Cir. 2014), that “absent a

settlement, a stipulation alone does not destroy th[e]

adversity” required for appellate jurisdiction. Id. at 1065. See

also Concha v. London, 62 F.3d 1493, 1507 (9th Cir. 1995).

Relying on Berger and Concha, the majority concludes that

the parties’ stipulation to dismiss their claims produced a

sufficiently “adverse” judgment because it was not “pursuant

to a settlement,” and was “plainly adverse to the Plaintiffs’

interests.”

Berger is inapposite, however, because it presupposes

procedural facts that do not exist in the present case. Berger

involved a single action in which a party argued its case to

one judge, the judge considered the argument and ruled

against that party, and then the two opposing parties

stipulated to dismissal for the sole purpose of obtaining a

final appealable judgment. Berger governs that type of case,

in which an involuntary, adverse interlocutory ruling merges

into a final appealable judgment, see Balla v. Idaho State Bd.

Of Corr., 869 F.2d 461, 468 (9th Cir. 1989), which is then

entered pursuant to a stipulation. For example, had the Apple

II Plaintiffs stipulated to dismissal in their case, in order to

achieve a final appealable ruling, that stipulation would have

fallen squarely within Berger’s holding, and there would be

no “adverseness” problem. But this case—Apple III—is

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WARD V. APPLE, INC. 37

different. Here, there was never an involuntary, adverse

ruling against the Apple III Plaintiffs because they asked

Judge Rogers to adopt Judge Ware’s reasoning against them.

See Apple III Dkt. (4:12-cv-05404) No. 24, p. 10–11

(Plaintiffs’ counsel arguing to Judge Rogers that “the

complaint [in Apple III] ought to be dismissed based on Judge

Ware’s . . . ruling in Apple II.”).

Concha is likewise inapposite. Concha says that a

stipulated final judgment “with prejudice” is adverse to the

plaintiffs’ interests—i.e., it has “sufficient prejudice in a legal

sense”—because it “serves to bar his claims forever.” Concha

v. London, 62 F.3d 1493, 1507 (9th Cir. 1995). But Concha

answered in the negative only the question whether a

voluntary dismissal “without prejudice” would also be

adverse to the Plaintiffs for purposes of statutory jurisdiction.

It did not address the question presented in this case: whether

a final decision of a district judge is involuntary and adverse

to a party who stipulated to a particular analysis against it,

and then asked the district judge to order final judgment, in

order to argue on appeal that such analysis was actually

incorrect.

Because the claims and parties in Apple III were different

from those in Apple II, Judge Ware’s order from Apple II did

not preclude Judge Rogers from deciding the Rule 19 issue in

Apple III. Consequently, the Apple III Plaintiffs were required

to argue their position independently in Apple III and to

obtain an involuntary and adverse ruling against them in

order to have an adverse decision from which to appeal. But

they failed to do so. They said that they assumed Judge

Rogers “would” rule consistently with Judge Ware, but they

never in fact argued to Judge Rogers that Judge Ware’s

analysis in Apple II was wrong, or that she should rule in their

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38 WARD V. APPLE, INC.

favor on the Rule 19 issue. Rather, they stipulated that Judge

Rogers rule against them on the Rule 19 issue for reasons

with which they ostensibly disagreed.

No case in our circuit stands for the proposition that a

non-party to a case can disagree with a judge’s ruling then

institute a new action, before a new judge, alleging a

narrower set of claims, in which they urge their judge to

adopt the prior judge’s analysis, and still have an involuntary

and adverse ruling required for appellate jurisdiction when

the new judge signs a stipulated final judgment. No

adverseness exists in the new action where the issue was

never actually litigated and no adverse positions were taken

by the parties.

That the purpose of Plaintiffs’ strategy was to fast-track

appellate review does not give us license to dispense with the

requirement that in every separate action, the parties must

take adverse positions on an issue and give the judge an

opportunity to rule independently on their claims. Otherwise,

parties could manipulate our appellate jurisdiction under the

guise of efficiency, in order to circumvent the general rule

that the district court be the first to pass judgment by applying

a legal rule to a set of claims. Cf. Am. States Ins. Co. v.

Dastar Corp., 318 F.3d 881, 885–86 (9th Cir. 2003) (“A

significant concern in assessing finality is whether the parties

have attempted to manipulate our appellate jurisdiction. A

party may not engage in manipulation either to create

appellate jurisdiction or prevent it.” (citations omitted)).

In sum, because the final judgment below was not

involuntary and adverse to the Apple III Plaintiffs, I am

persuaded that we lack statutory jurisdiction over this appeal.

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WARD V. APPLE, INC. 39

III.

Even if we had statutory jurisdiction, I would conclude

that the Apple III Plaintiffs waived the Rule 19 issue by

inviting Judge Rogers to adopt the very analysis that they

now allege on appeal was erroneous. “‘[O]ne may not

complain on review of errors below for which he is

responsible.’” Deland v. Old Republic Life Ins. Co., 758 F.2d

1331, 1336–37 (9th Cir.1985), quoting Hudson v. Wylie,

242 F.2d 435, 448 (9th Cir. 1957). See also Portland Gen.

Elec. Co. v. U.S. Bank Trust Nat’l Ass’n, 218 F.3d 1085, 1089

(9th Cir. 2000).

Although the Apple III Plaintiffs stipulated to incorporate

both parties’ motions from Apple II, they ultimately drafted

a stipulation dismissing their claims “for the reasons set forth

in Judge Ware’s July 11, 2012 Order,” instead of first asking

Judge Rogers either to revisit Judge Ware’s Rule 19 analysis

in Apple II, or to perform her own Rule 19 analysis in which

she could embrace their arguments. In fact, counsel for the

Apple III Plaintiffs invited Judge Rogers to adopt Judge

Ware’s alleged error, arguing that “the complaint [in Apple

III] ought to be dismissed based on Judge Ware’s . . . ruling

in Apple II.” At bottom, the Apple III Plaintiffs invited Judge

Rogers to sign on to an analysis from a different case with the

specific intent to argue on appeal that the analysis was

erroneous. In doing so, the Apple III Plaintiffs sought

improperly to skip over the district court to have us decide the

Rule 19 issue in the first instance. They have thereby waived

any challenge to the error they invited.

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