Opinion ID: 533632
Heading Depth: 3
Heading Rank: 4

Heading: Criticism of Ringsby

Text: 38 National Union urges us to adopt what is allegedly the Second Circuit's rule of granting vacatur when both parties agree to it. See Nestle Co. v. Chester's Market, Inc., 756 F.2d 280 (2d Cir.1985) (criticizing Ringsby ). Nestle involved a trademark dispute over the use of the words Toll House with cookies. The district court granted partial summary judgment against Nestle, who appealed. While on appeal a settlement was negotiated. Nestle, however, was still interested in pursuing the appeal and conditioned its settlement on the vacatur of the district court summary judgment, distinguishing it from Ringsby and the present case. 39 In Nestle, the question was not whether to vacate because the case was moot, but whether to vacate to make the case moot. The Nestle court found the Munsingwear rule inapplicable ... because [the case] is not moot. 756 F.2d at 281. In fact, the court reviewed for abuse of discretion, see 756 F.2d at 281 (applying Fed.R.Civ.P. 60(b)), as we did in Ringsby. The court looked to Munsingwear, not because it applied, but because it was instructive ... of the balance it strikes against the finality of judgments. 756 F.2d at 282. 40 The Munsingwear Court, however, did not vacate the underlying judgment. Rather, the Court paid respect to the importance of finality: The case illustrates not the hardship of res judicata but the need for it in providing terminal points for litigation. Munsingwear, 340 U.S. at 41, 71 S.Ct. at 107. 41 The concern of the Nestle court was the competing interests of encouraging settlement and maintaining judicial finality. While we favor the policy of encouraging settlement, see, e.g., Ahern v. Central Pac. Freight Lines, 846 F.2d 47, 48 (9th Cir.1988), settlement was already achieved here and in Ringsby. Further, Ringsby does not discourage settlement, although it may add slightly to its cost in two ways: first, there is a degree of uncertainty as to whether the judgment will be vacated, which will prompt the party desiring vacatur to extract a higher price from the other party; second, because Ringsby may require parties to make vacatur a condition of settlement, there may be delay while awaiting the court's decision on vacatur. 2 This cost is not so high that it should defeat 1) the public interest in maintaining judicial finality and 2) the legitimate interest of others in potential nonmutual preclusion. 42 Professors Wright, Miller and Cooper have also criticized Ringsby. See 13A Wright, Miller & Cooper, Federal Practice & Procedure § 3533.10, at 431-32 (2d ed. 1984). They support the view that the parties should be allowed to vacate a judgment as part of settlement, citing as support all the policies that make voluntary settlement so important a means of concluding litigation. Id. at 432. While this position is not without some merit, it is misleading to suggest, as they do, that such a rule is required by Munsingwear reasoning. We elect to weigh the policy interests differently.