After closing arguments but before the District Judge instructed the jury, the parties arrived at an oral agreement settling all claims and counterclaims, the substance of which they recited, on the record, before the District Judge in chambers. Thereafter the parties disagreed on petitioner's obligation to return certain files to respondent under the settlement agreement. On May 21 respondent moved in the District Court to enforce the agreement, which petitioner opposed on the ground, inter alia , that the court lacked subject matter jurisdiction. Petitioner appealed, relying solely on his jurisdictional objection. App. to Pet. for Cert.
Federal courts are courts of limited jurisdiction.
Neither the Rule nor any provision of law provides for jurisdiction of the court over disputes arising out of an agreement that produces the stipulation. It must be emphasized that what respondent seeks in this case is enforcement of the settlement agreement, and not merely reopening of the dismissed suit by reason of breach of the agreement that was the basis for dismissal. Enforcement of the settlement agreement, however, whether through award of damages or decree of specific performance, is more than just a continuation or renewal of the dismissed suit, and hence requires its own basis for jurisdiction. The doctrine of ancillary jurisdiction can hardly be criticized for being overly rigid or precise, but we think it does not stretch so far as that statement suggests. See, e.g. , Fulton Nat.