Opinion ID: 202819
Heading Depth: 2
Heading Rank: 1

Heading: Sala Stipulation

Text: The district court refused to set aside the Sala Stipulation based on the general principle that stipulations of attorneys made during a trial may not be disregarded or set aside at will. T I Fed. Credit Union v. DelBonis, 72 F.3d 921, 928 (1st Cir.1995) (quoting Marshall v. Emersons Ltd., 593 F.2d 565, 569 (4th Cir. 1979)); see also Rosario-Díaz v. González, 140 F.3d 312, 315 (1st Cir.1998) (Attorneys represent clients, and as a general rule an attorney's blunder binds her client.). As the district court correctly noted, stipulations are highly favored in our judicial system as a means of expedit[ing] a trial and eliminat[ing] the necessity of much tedious proof. T I Fed. Credit Union, 72 F.3d at 928 (quoting Burstein v. United States, 232 F.2d 19, 23 (8th Cir.1956)). Once entered, parties are not generally free to extricate themselves . . . [unless] `it becomes apparent that it may inflict a manifest injustice upon one of the contracting parties.' Id. (quoting Marshall, 593 F.2d at 568). Accordingly, a party may be relieved of a stipulation for good cause  which means, in a nutshell, that good reason must exist and that relief must not unfairly prejudice the opposing party or the interests of justice. Am. Honda Motor Co. v. Richard Lundgren, Inc., 314 F.3d 17, 21 (1st Cir.2002). One good reason for setting aside a stipulation is where it becomes evident that `the agreement was made under a clear mistake.' T I Fed. Credit Union, 72 F.3d at 928 (quoting Brast v. Winding Gulf Colliery Co., 94 F.2d 179, 181 (4th Cir.1938) (setting aside a stipulation as to tax liability where the calculation had been based on a misunderstanding of law)). Here, the district court gave Defendants an opportunity to prove that the stipulation was based on a mistake, but Defendants failed to make the required showing. [6] Defendants do not challenge the district court's rulings with respect to the inadmissibility of the Rule 1006 summaries [7] or the expert evidence presented with their ill-timed summary judgment motion. We have scoured the record, and, like the district court, we find no indication of any properly supported arguments that Oasis did not meet the ADV threshold. Alternatively, Defendants argue that the Sala Stipulation is procedurally invalid because it was not in writing or signed by the parties. They assert that stipulations between attorneys are not binding unless the represented parties assent to the stipulation, and that stipulations usually must be in writing unless made in open court. Defendants also posit that stipulations must be signed by all parties when required by local rules, citing Cavallini v. State Farm Mutual Auto Insurance Co., 44 F.3d 256, 266 (5th Cir.1995) (applying Tex.R. Civ. P. 11). The District Court for the District of Puerto Rico, however, has no specific rule requiring all agreements between parties to be in writing. [8] In any event, the district court memorialized the Sala Stipulation  entered into by the attorneys at a pre-trial status conference before the district court judge  in a September 16, 1996 order. Defendants did not object to the order, move to strike the reference to the stipulation, or request reconsideration. The order then became the law of the case, and any formalities suggested by Defendants with respect to the stipulation were rendered moot. See Fed.R.Civ.P. 16(e) (After any conference held pursuant to this rule, an order shall be entered reciting the action taken. This order shall control the subsequent course of the action unless modified by a subsequent order.). Finally, Defendants attack the subject matter jurisdiction of the court, arguing that the parties cannot stipulate to ADV coverage because it is a jurisdictional requirement of the FLSA. See Aponte v. Tabares, 114 F.3d 1169, 1997 WL 235473, at  (1st Cir.1997) (unpublished opinion) (Limits on subject matter jurisdiction are not waivable and, therefore, may be raised at any time.). This argument fails, however, because ADV coverage is not jurisdictional. As the Supreme Court recently noted, Subject matter jurisdiction in federal-question cases is sometimes erroneously conflated with a plaintiff's need and ability to prove the defendant bound by the federal law asserted as the predicate for relief-a merits-related determination. Arbaugh v. Y & H Corp., 546 U.S. 500, 511, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006) (quoting 2 James Wm. Moore et al., Moore's Federal Practice § 12.30[1] (3d ed.2005)). To mitigate this confusion, the Court provided clear guidance for distinguishing between the two concepts: [W]hen Congress does not rank a statutory limitation on coverage as jurisdictional, courts should treat the restriction as nonjurisdictional in character. Id. at 515, 126 S.Ct. 1235. The FLSA places the ADV limitation in the definitions section of the Act, and does not suggest that the ADV limitation is jurisdictional. See 29 U.S.C. §§ 203(s)(1)(a), 216. We therefore treat it as an element of the claim. Cf. Fernández v. Centerplate/NBSE, 441 F.3d 1006, 1009 (D.C.Cir.2006) (While the merits of Fernandez's FLSA claim turn on whether she was paid for hours worked in excess of forty per week, nothing in the FLSA suggests that a failure to prove this particular element of her cause of action requires a dismissal for lack of jurisdiction.); Minard v. ITC Deltacom Commc'ns, Inc., 447 F.3d 352, 356 (5th Cir.2006) (In light of the Supreme Court's decision in Arbaugh, we conclude that the definition section of the [Family Medical Leave Act] . . . is a substantive ingredient of a plaintiff's claim for relief, not a jurisdictional limitation.). As Defendants have not established good cause for setting aside the Sala Stipulation, we find no abuse of discretion in the district court's decision to hold Defendants to their agreement.