Court Opinion

ID: 64870
Source: CourtListenerOpinion
Date Created: 2010-04-26 05:23:55+00
Date Added: 2024-06-11T09:38:54.663088
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS
                     FOR THE FIFTH CIRCUIT United States Court of Appeals
                                                    Fifth Circuit

                                                                                         FILED
                                                                                     February 12, 2009

                                           No. 08-30825                           Charles R. Fulbruge III
                                         Summary Calendar                                 Clerk

SSC ACQUISITION CORP., doing business as Scientific Systems Corporation

                                                           Plaintiff - Appellee
v.

DAVID R. RATCLIFF; ANTHONY W. COLLIER; SAFE AIR TECHNOLOGY
LLC

                                                           Defendants - Appellants

                       Appeal from the United States District Court
                           for the Middle District of Louisiana
                                 USDC No. 3:04-CV-421

Before JOLLY, BENAVIDES, and HAYNES, Circuit Judges.
PER CURIAM:*
        David Ratcliff, Anthony Collier, and Safe Air Technology, LLC
(collectively, “Safe Air”) appeal the district court’s denial of their motion to
interpret a settlement agreement and its grant of Appellee SSC Acquisition
Corp.’s (“SSC”) motion to enforce the settlement agreement. Because the order
does not fully resolve the rights and liabilities of the parties under the
settlement agreement and does not conclude the district court’s role in enforcing

        *
          Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and
is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
                                                  08-30825
the settlement agreement, the order is not final and appealable. We therefore
dismiss the appeal.
                                                       I.
        In 2004, SSC sued Safe Air alleging, among other things, that Safe Air had
violated federal copyright law by infringing on SSC’s trademarks in the
manufacture and sale of certain specialized heating and cooling systems.
Following negotiations, the parties entered into a settlement agreement and
filed a joint motion to dismiss in part, which the district court granted on May
1, 2006.        In granting the motion, the district court specifically retained
“jurisdiction for the limited purpose of enforcement in accordance with the terms
of the Settlement Agreement.”1 Under the terms of the settlement agreement,
the parties’ dispute was to be resolved by a technical auditor and, if necessary,
a special master, a consulting attorney, and an accounting auditor.                                         The
technical auditor’s role was:
           (a) to identify the first generation of a [Safe Air Technology]
        product for a comparison to SSC products; and

           (b) to ascertain whether an existing or new product of [Safe Air
        Technology] was “copied” from the products of SSC as they existed
        prior to January 1, 2003, with information in which SSC had a
        protectable interest. “Protectable information” as used herein is
        information whose source and/or applications came from SSC.
        “Copied” as used herein shall exclude any products copied or that
        could have been copied from another source other than SSC.

        On October 15, 2007, the technical auditor finished his report on certain
Safe Air Technology products and found that they were “copied.” Under the

        1
         The settlement agreement provides that the district court “shall retain jurisdiction to enforce the terms
and conditions of this Agreement, to resolve disputes arising hereunder and for such other action as may be
necessary or appropriate for construction or execution of this Agreement.”

                                                        2
                                       08-30825
terms of the settlement agreement, Safe Air must pay SSC a royalty of eight
percent (8%) of the gross sales of a “copied” product. Safe Air appealed the
technical auditor’s finding to the special master, as provided by the settlement
agreement. The special master affirmed the technical auditor’s findings. Safe
Air subsequently refused to allow the technical auditor to audit its remaining
products. SSC filed a motion to enforce the settlement agreement in the district
court seeking to require Safe Air to allow the technical auditor to continue,
participate in selecting a financial auditor, and pay SSC’s legal fees resulting
from Safe Air’s appeal to the special master. Safe Air then filed a motion to
interpret the settlement agreement in which it asked the district court to require
the special master to reconsider his decision on the grounds that he had
erroneously construed the settlement agreement. On July 16, 2008, the district
court granted SSC’s motion and denied Safe Air’s, and directed Safe Air, inter
alia, to comply with the settlement agreement’s procedures to appoint an
accounting auditor, to cooperate with the technical auditor, and to pay fees due
to SSC’s attorneys. Safe Air appealed from this ruling, and SSC filed a motion
to dismiss for lack of jurisdiction.
                                         II.
      “As a general rule, federal law limits our appellate jurisdiction to
reviewing final decisions of the district courts.” Graham v. Johnson, 168 F.3d
762, 774 (5th Cir. 1999) (citing 28 U.S.C. § 1291). “A ‘final decision’ generally is
one which ends the litigation on the merits and leaves nothing for the court to
do but execute the judgment.” Catlin v. United States, 324 U.S. 229, 233 (1945).
“[T]he final judgment rule promotes efficient judicial administration while at the
same time emphasizing the deference appellate courts owe to the district judge’s
decisions on the many questions of law and fact that arise before judgment.”

                                          3
                                                  08-30825
Richardson-Merrell, Inc. v. Koller, 472 U.S. 424, 430 (1985). “Immediate review
of every trial court ruling, while permitting more prompt correction of erroneous
decisions, would impose unreasonable disruption, delay, and expense. It would
also undermine the ability of district judges to supervise litigation.” Id. Section
1291 does not allow “piecemeal appellate review of trial court decisions which do
not terminate the litigation.” Id. (quoting United States v. Hollywood Motor Car
Co., 458 U.S. 263, 265 (1982)).
        Here, the district court’s ruling is not a “final decision.”                                 We have
previously indicated, in an unpublished opinion, that as long as a district court
“retains its residual grant of jurisdiction further to enforce, administer, and
interpret the settlement agreement, any action it takes in this capacity lacks the
attribute of finality that is necessary to make the order immediately appealable.”
McMahon Foundation v. Amerada Hess Corp., 98 F. App’x 267, 271 (5th Cir.
2004). It is clear that the order here has not concluded the district court’s role
in enforcing the settlement agreement. Moreover, even if we were ever to allow
an appeal of a district court’s ruling on a motion to enforce or interpret a
settlement agreement while the district court retained jurisdiction, we would not
do so here, where there is an obvious risk of “piecemeal appellate review.”
Richardson-Merrell, Inc., 472 U.S. at 430 (quotation omitted). Safe Air alleges
that the technical auditor and special master have misinterpreted the settlement
agreement, and it is undisputed that the technical auditor has not completed his
review of Safe Air Technology’s products—thus, further issues relating to that
review may yet arise.2 Under these facts, the district court has more to do than

        2
           We express no opinion as to whether, to obtain quicker appellate review, Safe Air could have raised
its claims in a separate action for declaratory judgment, nor as to whether the district court could have certified
its ruling as a final judgment under Rule 54(b).

                                                        4
                                                 08-30825
merely execute the judgment, and the decision at issue here is not final.3 Catlin,
324 U.S. at 233. We therefore GRANT SSC’s motion and DISMISS the appeal
for want of jurisdiction. We do not reach the merits of the district court’s ruling.

        3
           Safe Air cites Lindsay v. Ford Motor Co., No. 94-10503, 1994 WL 684970 (5th Cir. Nov. 22, 1994)
(unpublished), for the proposition that a ruling on a motion to enforce a settlement agreement is final and
appealable. In Lindsay, however, the Court specifically noted that as a result of the district court’s order, the
district court had “nothing left to adjudicate.” 1994 WL 684970 at *2. As discussed above, that is not the case
here. Similarly, in Evans-Carmichael v. United States, also cited by Safe Air, the order at issue “effectively
resolved all of the matters between the parties, and was thus appealable as a final decision.” 250 F. App’x 256,
261 (10th Cir. 2007). Finally, while Safe Air cites Kirkland v. Legion Insurance Co., there, too, “[t]here
was no other conceivable district court order with respect to the case’s merits once the court in effect
approved the settlement agreement by enforcing its terms.” 343 F.3d 1135, 1139–1140 (9th Cir.
2003).

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