Opinion ID: 76534
Heading Depth: 2
Heading Rank: 2

Heading: The Bar Order

Text: 22 We turn now to the challenge of BAS and Deloitte to a provision in the Final Judgment and Order of Dismissal with Prejudice (herein referred to as the bar order) that bars all related present and future claims by Deloitte and non-settling defendant BAS against the Officers, and also bars any such claims against other officers and agents of JFF who are not parties to the instant case. Deloitte and BAS argue that the bar order impermissibly extends beyond the scope of the Private Securities Litigation Reform Act of 1995, 15 U.S.C. § 78u-4(f)(7)(A) (herein referred to as the PSLRA), by precluding, without a proper settlement credit, claims for contribution in other pending cases and claims that are truly independent of the settled claims — in both instances precluding claims other than those where the damages are calculated based on the non-settling defendants' liability to these plaintiffs in this suit. See, e.g., Gerber v. MTC Elec. Techs. Co., Ltd., 329 F.3d 297, 306 (2nd Cir.2003). Deloitte and BAS argue that there is no justification, wholly aside from any limitation inherent in the PSLRA, for barring contribution claims by Deloitte and BAS against the Officers that may arise out of causes of action brought by plaintiffs other than the plaintiffs in the settled action, or for barring truly independent claims ( e.g. claims which are not based on the claimants' liability to the instant plaintiffs or claims based on damages completely separate from the instant damages) that Deloitte and BAS may have against the Officers. They also argue that there is no justification for barring claims they may have against other officers and agents of JFF who are not parties here. 23 Appellees argue in brief that our decision in In re U.S. Oil & Gas Litigation, 967 F.2d 489 (11th Cir.1992), is controlling in this case. In support of that argument, they now cite as supplemental authority the district court opinion in State of Wisconsin Investment Board v. Ruttenberg, 300 F.Supp.2d 1210, 2003 WL 23205155 (N.D.Ala. Jan.29, 2004). Because that opinion treated our decision in U.S. Oil & Gas as controlling in that case, and because we do not consider U.S. Oil & Gas controlling in the instant case, we do not find the Northern District of Alabama case to be persuasive. Although the language of the bar order involved in U.S. Oil & Gas was broad, as it is here, the holding of our decision was much more narrow. In that case, we addressed the merits of Pinnacle's specific challenge. Id. at 495. We held that the bar order properly barred Pinnacle's cross-claim. However, Pinnacle's cross-claim was an attempt to seek indemnity from A & A for the federal securities law violations alleged against Pinnacle in the complaints in that very case, i.e., for Pinnacle's liability to those same plaintiffs. Id. With respect to Pinnacle's allegedly independent causes of action for fraud and negligence, we held that [t]hese claims were not, in fact, independent of Pinnacle's or A & A's liability to the plaintiffs. Id. at 495-96. Rather, we noted that Pinnacle stated in its cross-claim that it `seeks damages against A & A and Riley to the extent that it is liable to any of the plaintiffs herein.' Id. at 496. The opinion expressly declined to address the issue of truly independent claims. Id. at 496 n. 5. Thus, we reject the argument that U.S. Oil & Gas controls this case. 12 Indeed, we have found no controlling authority. 24 In this case, the bar order is exceedingly broad, and the district court made no findings of fact, and expressed no rationale or authority for barring claims without a settlement credit or set off, or for barring claims that arise from causes of action brought by plaintiffs other than the instant plaintiffs or truly independent claims. In view of the absence of controlling authority, and the absence of findings of fact detailing the relevant circumstances surrounding the issue in this case, and in the absence of any articulation of the district court justifying the bar order, our review is significantly handicapped; we cannot ascertain whether sufficient justification exists for the bar order entered in this case. We prefer to assess the justification issue in the first instance on the basis of concrete facts found by the district court, and with the assistance of the district court's full consideration and discussion of all of the relevant facts of the instant case and a full discussion of the relevant persuasive authorities and the underlying reasons and policies justifying whatever order the district court ultimately approves. Thus, we vacate 13 the bar order and remand 14 the matter to the district court for reconsideration and entry of an order that is reasonable, fair and equitable. 25 DISMISSED IN PART, VACATED IN PART, AND REMANDED.