Opinion ID: 1346280
Heading Depth: 3
Heading Rank: 2

Heading: Judicial Imprimatur

Text: Defendants' second contention is also unpersuasive. Under Buckhannon, Defendants argue, only three outcomes have the requisite judicial imprimatur: a judgment on the merits, a consent decree, or a judicially enforceable settlement agreement. So-ordered settlements that do not explicitly provide for the retention of jurisdiction, like the one here, fall into none of these three categories, the argument continues, and therefore Plaintiffs are not prevailing parties. But nothing in Buckhannon or its sequelae limits judicial imprimatur to these three narrow categories, hence Defendants' major premise is incorrect. The judicial imprimatur test grows out of Buckhannon, in which the Supreme Court considered and rejected the catalyst theory that was, at the time, the law of this Court (and of the majority of circuits) for gauging whether the prevailing parties requirement was met. See, e.g., Marbley v. Bane, 57 F.3d 224, 234 (2d Cir.1995). Under the catalyst theory, a plaintiff prevailed for the purpose of fee-shifting provisions whenever her lawsuit had sufficient merit to withstand a motion to dismiss and brought about a voluntary change in the defendant's conduct. Buckhannon, 532 U.S. at 601, 605, 121 S.Ct. 1835. The Supreme Court held that this interpretation was inconsistent with the definition of prevailing parties when used as a term of art. Id. at 603, 121 S.Ct. 1835. Instead, the Court held, plaintiffs must receive some relief on the merits to be termed prevailing parties, as, for example, when they win a judgment on the merits or obtain settlement agreements enforced through a consent decree. Id. at 603-04, 121 S.Ct. 1835 (internal quotation marks omitted). In a footnote, the Court added that [p]rivate settlements do not entail the judicial approval and oversight involved in consent decrees. And federal jurisdiction to enforce a private contractual settlement will often be lacking unless the terms of the agreement are incorporated into the order of dismissal. Id. at 604 n. 7, 121 S.Ct. 1835. Although the Supreme Court specifically mentioned merits decisions and consent decrees, it did not suggest that one of these two conditions was necessary for a party to prevail. Indeed, it referred to them as examples of sufficient outcomes. Id. at 605, 121 S.Ct. 1835. Accordingly, we held in Roberson that judicial action other than a judgment on the merits or a consent decree can support an award of attorneys' fees, so long as such action carries with it sufficient judicial imprimatur. Roberson, 346 F.3d at 81. We then went on to consider the status under Buckhannon of a dismissal order that did not incorporate the terms of a settlement agreement but did provide that the district court would retain jurisdiction ... for enforcement purposes. Id. at 78. In examining this question, we looked to Kokkonen, in which the Supreme Court held that a federal district court could not exercise jurisdiction over the enforcement of a settlement agreement where its order of dismissal neither incorporated the terms of the settlement agreement nor included a provision retaining jurisdiction. But the Court stated quite clearly that a district court could exercise jurisdiction in the two above-mentioned scenarios. As the Court wrote: We have recognized inherent authority to appoint counsel to investigate and prosecute violation of a court's order. But the only order here was that the suit be dismissed, a disposition that is in no way flouted or imperiled by the alleged breach of the settlement agreement. The situation would be quite different if the parties' obligation to comply with the terms of the settlement agreement had been made part of the order of dismissal  either by separate provision (such as a provision retaining jurisdiction over the settlement agreement) or by incorporating the terms of the settlement agreement in the order. In that event, a breach of the agreement would be a violation of the order, and ancillary jurisdiction to enforce the agreement would therefore exist. Kokkonen, 511 U.S. at 380-81, 114 S.Ct. 1673 (internal citations omitted). [6] Roberson dealt with the first hypothetical situation discussed in Kokkonen: an order of dismissal retaining jurisdiction over a settlement agreement, but not otherwise referencing its terms. We noted that Buckhannon had cited this portion of Kokkonen approvingly, and had reaffirmed that federal jurisdiction to enforce a private contractual settlement could exist where the terms of the agreement are incorporated into the order of dismissal. Buckhannon, 532 U.S. at 604 n. 7, 121 S.Ct. 1835; see Roberson, 346 F.3d at 81. We went on to state that: [v]iewed in the light of Kokkonen, the district court's retention of jurisdiction in this case is not significantly different from a consent decree and entails a level of judicial sanction sufficient to support an award of attorney's fees. First, despite the district court's statements that it had not specifically reviewed or approved the terms of the settlement agreement, the district court retained jurisdiction to enforce the Agreement. Under Kokkonen, when the district court retained jurisdiction, it necessarily made compliance with the terms of the agreement a part of its order so that a breach of the agreement would be a violation of the order. Further, because the court has the general responsibility to ensure that its orders are fair and lawful, it retains some responsibility over the terms of a settlement agreement as the parties' obligation to comply with the agreement was made a part of its order. Id. at 82 (citation omitted). We held that, as the Fourth Circuit had previously also concluded, [a] court's responsibility to ensure that its orders are fair and lawful stamps an agreement that is made part of an order with judicial imprimatur. Id. at 83 (quoting Smyth v. Rivero, 282 F.3d 268, 282 (4th Cir.2002)). Such ongoing inherent authority made orders of dismissal in which the district court retained jurisdiction to enforce the underlying settlement agreement indistinguishable from consent decrees for the purposes of Buckhannon. As a result, we concluded that the Roberson plaintiffs were entitled to seek fees. Id. at 83-84. We have never squarely considered the second Kokkonen scenario, that of an order of dismissal that explicitly incorporates the terms of a settlement, as does the Order of Settlement before us today. But the logic of Roberson suggests that such orders must satisfy Buckhannon. At the end of a footnote in Torres v. Walker, 356 F.3d 238 (2d Cir.2004), however, we stated in dicta that  Buckhannon requires not only the physical incorporation of the settlement in a district court's order but also some evidence that a district court intended to place its `judicial imprimatur' on the settlement. Id. at 244 n. 6 (emphasis added). Whatever the significance of this remark, it is plain that, even under the Torres footnote, there is ample evidence in the instant case that the District Court intended to place its `judicial imprimatur' on the settlement. Id. The Order of Settlement provided that Plaintiffs' lawsuits would only be dismissed [u]pon the Court's approval and entry of this Stipulation and Order. This is not a case where [d]ismissal was effectuated by stipulation, or mutual agreement of the parties, and did not require any judicial action, Hester Indus., Inc. v. Tyson Foods, Inc., 160 F.3d 911, 916 (2d Cir. 1998); rather, the settlement was only made operative by the Court's review and approval. In a quite literal sense, it was the District Court's imprimatur that made the settlement valid. [7] Furthermore, this language is characteristic of another source of the requisite imprimatur. The record demonstrates beyond peradventure Judge Berman's extensive involvement and close management of the case. He played an integral role in the resolution of the suit, he advised the parties on how they should expect the law to come out, he suggested appropriate settlement terms, and he directed counsel to conduct settlement negotiations and to bring settlement offers back to their respective parties. When the parties brought the outlines of the ultimate settlement proposal to the Court, Judge Berman pressed Defendants' counsel on the need to make the agreement part of an enforceable stipulation. Here again, we find strong evidence that Judge Berman judicially sanctioned the settlement. Cf. Buckhannon, 532 U.S. at 618, 121 S.Ct. 1835 (Scalia, J., concurring) (In the case of court-approved settlements ..., even if there has been no judicial determination of the merits, the outcome is at least the product of, and bears the sanction of, judicial action in the lawsuit. There is at least some basis for saying that the party favored by the settlement ... prevailed in the suit. ). [8] We, therefore, conclude that the evidence considered together makes manifest that the Order of Settlement bore the imprimatur of the District Court. Buckhannon is satisfied, and Plaintiffs qualify as prevailing parties under 42 U.S.C. § 1988(b).