Court Opinion

ID: 170557
Source: CourtListenerOpinion
Date Created: 2010-08-14 18:10:29+00
Date Added: 2024-06-11T17:25:08.053015
License: Public Domain

FILED
                                                          United States Court of
                                                                 Appeals
                                                              Tenth Circuit

                                                            April 11, 2008
                 UNITED STATES COURT OF APPEALS
                                                         Elisabeth A. Shumaker
                                                             Clerk of Court
                               TENTH CIRCUIT

MALYNDA McMURTRY,

        Plaintiff,

v.                                        Nos. 06-6358, 06-6370
                                          (D.C. No. CV-05-84-C)
AETNA LIFE INSURANCE                        (W.D. Oklahoma)
COMPANY,

        Defendant-Appellee,

NORMAN REGIONAL HOSPITAL
AUTHORITY, a public trust, doing
business as Norman Regional
Hospital,

        Defendant-Appellant,
-------------------------

NORMAN REGIONAL HOSPITAL
LONG TERM DISABILITY PLAN,

        Intervenor - Appellant,

and

LIFECARE HEALTH SERVICES,
LLC; OKLAHOMA HOSPITAL
ASSOCIATION,

        Amici Curiae.
                        ORDER AND JUDGMENT *

Before BRISCOE, SEYMOUR, and LUCERO, Circuit Judges.

      These appeals arise out of an insurance coverage dispute between the

original parties, Malynda McMurtry and Aetna Life Insurance Company. Ms.

McMurtry filed state law bad faith claims, but Aetna argued that those claims

were barred because the insurance plan in question was governed by ERISA. The

district court ruled in favor of Aetna, holding that the plan was covered by ERISA

and the state law claims were therefore preempted. Norman Regional Hospital

Authority and the Norman Regional Hospital Long Term Disability Plan

(hereinafter together referred to as NRHA) then attempted to intervene in order to

argue the ERISA applicability issue. Although the district court denied the

motion to intervene as untimely, it ordered NRHA added as a necessary defendant

to the ERISA claim because it was the offeror of the plan. NRHA and Ms.

McMurtry were granted permissive interlocutory appeals pursuant to 28 U.S.C. §

1292(b). After some of the briefing on the appeals was completed in this court,

Ms. McMurtry and Aetna settled. NRHA is the remaining appellant. The

      *
         This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. It may be cited,
however, for its persuasive value consistent with F ED . R. A PP . P. 32.1 and 10 TH
C IR . R. 32.1.

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questions we address are (1) whether Ms. McMurtry and Aetna’s settlement moots

the present appeals, and, if so, (2) whether the district court order should be

vacated. We answer both questions in the affirmative.

                                          I.

      Courts lack jurisdiction over claims that are moot. Indeed, “Article III of

the Constitution requires that [courts] only decide cases or controversies, and thus

prohibits [them] from resolving hypothetical legal questions . . . relevant only to

the resolution of an already dismissed dispute.” Prier v. Steed, 456 F.3d 1209,

1212 (10th Cir. 2006). Mootness arises in situations like this one because where

“the underlying litigation [is] dismissed by agreement of the parties pursuant to

[a] settlement, [] there is no longer any action in which to intervene.” Energy

Transp. Group, Inc. v. Maritime Admin., 956 F.2d 1206, 1210 (D.C. Cir. 1992)

(citing Tosco Corp. v. Hodel, 804 F.2d 590, 592 (10th Cir. 1986)).

      Ms. McMurtry and Aetna have settled the dispute over Ms. McMurtry’s

insurance benefits. As a result, Ms. McMurtry – the only party who has asserted

any claims in this case – requested dismissal of all of her claims, with prejudice,

in both the district court and this court. Her own appeal has been dismissed and

she has submitted motions seeking dismissal of her as a party in NRHA’s appeals.

      The legal issues that are the subjects of the remaining appeals are either

collateral or subsidiary to Ms. McMurtry’s claims. Any opinion we might issue

on the merits of the remaining appeals would be advisory only, in contravention

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of well-established law. United States v. Burlington N. R.R. Co., 200 F.3d 679,

699 (10th Cir. 1999) (“It is fundamental that federal courts do not render advisory

opinions and that they are limited to deciding issues in actual cases and

controversies.”) (quoting Norvell v. Sangre de Cristo Dev. Co., Inc., 519 F.2d

370, 375 (10th Cir. 1975)). Accordingly, we conclude that the settlement

agreement between Ms. McMurtry and Aetna renders moot the remaining appeals

of NRHA. 1

                                         II.

      Given the mootness of NRHA’s appeals, we must determine whether the

district court’s order granting summary judgment should be vacated. The

Supreme Court has described United States v. Munsingwear, Inc., 340 U.S. 36

(1950), as the “leading case on vacatur.” U.S. Bancorp Mortgage Co. v. Bonner

Mall P’ship, 513 U.S. 18, 22 (1994). In Munsingwear, the Court explained:

      The established practice of the Court in dealing with a civil case
      from a court in the federal system which has become moot while on
      its way here or pending our decision on the merits is to reverse or
      vacate the judgment below and remand with a direction to dismiss.
      That was said in Duke Power Co. v. Greenwood County, 299 U.S.
      259, 267 [1936] to be ‘the duty of the appellate court.’ That
      procedure clears the path for future relitigation of the issues between
      the parties and eliminates a judgment, review of which was prevented
      through happenstance. When that procedure is followed, the rights
      of all parties are preserved; none is prejudiced by a decision which in
      the statutory scheme was only preliminary.

      1
      Under the same reasoning, we also conclude that the pending motion to
supplement the record on appeal is moot.

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Munsingwear, 340 U.S. at 39-40. The Court was concerned that judgments not

subject to appellate review due to mootness not be binding on any parties.

Subsequently, the Court clarified that vacatur of a lower court decision due to

mootness is an equitable remedy, not an automatic right. In deciding whether to

vacate a district court decision, we must consider “the nature and character of the

conditions which have caused the case to become moot.” U.S. Bancorp

Mortgage, 513 U.S. at 24 (quotations and citations omitted). The “principle

condition to which we have looked,” the Court specified, “is whether the party

seeking relief from the judgment below caused the mootness by voluntary action.”

Id. The Court continued:

             The reference to “happenstance” in Munsingwear must be
      understood as an allusion to this equitable tradition of vacatur. A
      party who seeks review of the merits of an adverse ruling, but is
      frustrated by the vagaries of circumstance, ought not in fairness be
      forced to acquiesce in the judgment. The same is true when
      mootness results from unilateral action of the party who prevailed
      below. Where mootness results from settlement, however, the losing
      party has voluntarily forfeited his legal remedy by the ordinary
      processes of appeal or certiorari, thereby surrendering his claim to
      the equitable remedy of vacatur. The judgment is not unreviewable,
      but simply unreviewed by his own choice. The denial of vacatur is
      merely one application of the principle that a suitor’s conduct in
      relation to the matter at hand may disentitle him to the relief he
      seeks.

Id. at 25 (internal quotation and citations omitted). Here, therefore, equitable

vacatur would not be warranted if either Ms. McMurtry or Aetna petitioned for it

because both of those parties voluntarily forfeited their legal remedies by

                                         -5-
choosing to settle. NRHA, however, is not a party to that settlement agreement,

and thus has a more compelling claim for equitable vacatur. In mooting the

remaining claims on appeal, the settlement agreement denied NRHA the appeal

that it seeks. This is precisely the type of “happenstance” that concerned the

Court in Munsingwear.

        “‘When causes beyond the appellant’s control make a case moot pending

appeal, a federal appellate court generally should vacate the judgment below and

remand with directions to dismiss.’” Shawnee Tribe v. United States, 405 F.3d

1121, 1135 (10th Cir. 2005) (quoting McClendon v. City of Albuquerque, 100

F.3d 863, 868 (10th Cir. 1996)). See also Jones v. Temmer, 57 F.3d 921, 923

(10th Cir. 1995) (the “pivotal issue” in deciding whether to grant equitable

vacatur is “‘whether the party seeking relief from the judgment below caused the

mootness by voluntary action.’” (quoting U.S. Bancorp Mortgage, 513 U.S. at

24)).

        Because NRHA had nothing to do with causing this case to become moot, it

“ought not in fairness be forced to acquiesce” in the district court’s judgment.

U.S. Bancorp Mortgage, 513 U.S. at 25. As pertinent here, in Wyoming v. United

States Department of Agriculture, 414 F.3d 1207, 1213 (10th Cir. 2005), we

exercised our discretion to order the district court to vacate its opinion where a

third party’s appeal was mooted by one of the other parties to the action. There,

the intervener defendants’ appeal became moot when the Forest Service, its co-

                                         -6-
defendant, promulgated a new rule replacing the one which was the subject of the

appeal. Id. at 1212. We held that “because the party seeking appellate relief is

not the party responsible for mooting the case,” it was “appropriate to vacate the

district court’s order.” Id. at 1213.

      Accordingly, we DISMISS these appeals as moot, VACATE the district

court’s order granting summary judgment, and REMAND with instructions to

dismiss the action.

                                        ENTERED FOR THE COURT

                                        Stephanie K. Seymour
                                        Circuit Judge

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