Court Opinion

ID: 3030342
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:44:13.200173+00
Date Added: 2024-06-11T11:48:07.057611
License: Public Domain

FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

GATOR.COM CORP.,                             No. 02-15035
                 Plaintiff-Appellant,
                 v.                            D.C. No.
                                            CV-01-01126-MEJ
L.L. BEAN, INC.,
                                               OPINION
               Defendant-Appellee.
                                        
       Appeal from the United States District Court
          for the Northern District of California
      Maria-Elena James, Magistrate Judge, Presiding

                  Argued and Submitted
         June 22, 2004—San Francisco, California

                   Filed February 15, 2005

         Before: Mary M. Schroeder, Chief Judge,
      Warren J. Ferguson, Diarmuid F. O’Scannlain,
 Pamela Ann Rymer, A. Wallace Tashima, Susan P. Graber,
       M. Margaret McKeown, William A. Fletcher,
   Ronald M. Gould, Richard A. Paez, and Jay S. Bybee,
                     Circuit Judges.

               Opinion by Judge O’Scannlain;
               Concurrence by Judge Tashima;
                Dissent by Judge W. Fletcher

                             1833
1836          GATOR.COM CORP. v. L.L. BEAN, INC.

                          COUNSEL

Michael Traynor, Cooley Godward LLP, San Francisco, Cali-
fornia, argued the cause for the appellant; Thomas J. Friel, Jr.,
and Brian E. Mitchell, Cooley Godward LLP, San Francisco,
California, and L. Scott Primak, Redwood City, California,
were on the briefs.

Daniel J. Bergeson and Melinda M. Morton, Bergeson, LLP,
San Jose, California, were substituted as counsel for the
appellant after oral argument.

Peter J. Brann, Brann & Isaacson, Lewiston, Maine, argued
the cause for the appellee; Kevin J. Beal, Brann & Isaacson,
Lewiston, Maine, was on the brief.

Alan E. Untereiner, Kathryn Schaefer Zecca, and Max Huff-
man, Robbins, Russell, Englert, Orseck & Untereiner LLP,
Washington, D.C., and Robin S. Conrad and Stephanie A.
Martz, Washington, D.C., were on the brief for amicus curiae
The Chamber of Commerce of the United States.

                          OPINION

O’SCANNLAIN, Circuit Judge:

   We must decide whether a declaratory judgment action ini-
tiated to determine the legality of a software vendor’s pop-up
               GATOR.COM CORP. v. L.L. BEAN, INC.              1837
advertising program is rendered moot by a settlement under
which the vendor permanently modified its software and the
website owner relinquished all claims.

                                 I

   Gator.com Corporation1 is the proprietor of a software pro-
gram that enables computer users to store personal
information—including addresses, credit card numbers, and
passwords—in a “digital wallet.” When a website prompts the
user for such information, Gator’s digital wallet automatically
inputs it. The program also provides users with discount cou-
pons and other special offers that “pop up” on the computer
screen when the user visits certain websites preselected by
Gator. Until November 20, 2004, one of the targets of Gator’s
pop-up advertisements was the website operated by L. L.
Bean, Inc., a clothing manufacturer that sells its products over
the Internet, via a mail-order catalog, and in retail stores.
When a user of computer equipment on which the Gator soft-
ware was installed visited L. L. Bean’s website, the program
triggered a discount coupon for Eddie Bauer—an L. L. Bean
competitor—to appear on the screen.

                                 A

   In a cease-and-desist letter sent to Gator in March 2001, L.
L. Bean alleged that these pop-up advertisements misappro-
priated the good will associated with its trademark and threat-
ened to initiate legal action if Gator did not discontinue this
advertising practice. Gator responded by filing suit against L.
L. Bean in the United States District Court for the Northern
District of California. Gator requested a declaratory judgment
that its program “does not infringe or dilute, directly or contri-
butorily, any trademark held by [L. L. Bean] and does not
constitute unfair competition, a deceptive or unfair trade or
  1
   Gator.com Corporation is now known as the Claria Corporation. For
ease of reference, it will be referred to as “Gator” throughout.
1838             GATOR.COM CORP. v. L.L. BEAN, INC.
sales practice, false advertising, fraud or any other violation
of either federal or state law.” Compl. at 4. Gator sought no
other forms of relief.

   L. L. Bean moved to dismiss the suit on the ground that the
district court lacked personal jurisdiction because L. L. Bean
was incorporated and headquartered in Maine and maintained
no physical presence in California. Upon concluding that both
general and specific personal jurisdiction over L. L. Bean
were absent, the district court granted the motion to dismiss.
Gator timely appealed.

                                    B

   After the parties had briefed the personal jurisdiction issue
and the en banc court had heard oral argument, the parties
jointly informed us that they had reached a confidential settle-
ment of other litigation in which they were involved. The par-
ties assured us, however, that the settlement “does not provide
for the dismissal of this appeal.” Joint Letter of Sept. 1, 2004.
Mindful of our constitutional obligation to police jurisdic-
tional matters assiduously, we nevertheless requested a copy
of the settlement agreement, which the parties submitted
under seal.2

   Under the terms of the settlement, Gator agreed to place no
   2
     Because the parties emphasized to us the confidential nature of their
settlement, we permitted the agreement to be filed under seal and
instructed the parties to submit a copy of any sealing order. Upon review-
ing their submission, we learned that no court had actually ordered that the
agreement be sealed. In the absence of such an order, it is appropriate for
us to disclose the settlement agreement’s content because the outcome of
our mootness inquiry hinges upon those specifics. Cf. Circuit Advisory
Committee Note to Ninth Circuit Rule 27-13 (“any portion of the district
court or agency record that was sealed below shall remain under seal upon
transmittal to this court” (emphasis added)). In any event, none of the pro-
visions that we discuss implicates the parties’ proprietary information or
trade secrets.
              GATOR.COM CORP. v. L.L. BEAN, INC.              1839
more than twenty-five pop-up advertisements per month on
the L. L. Bean website between August 21, 2004, and Novem-
ber 20, 2004. The agreement further provided that, after this
three-month period had elapsed, Gator would permanently
discontinue the use of all such advertisements on the L. L.
Bean website. Gator also agreed to make a monetary payment
to L. L. Bean. In exchange for these concessions, L. L. Bean
renounced all claims arising from Gator’s use of pop-up
advertisements prior to—or in accordance with—the agree-
ment.

  Regarding this litigation, the parties agreed:

    L. L. Bean may, at its sole discretion, require [Gator]
    to file an agreed upon motion to dismiss the appeal
    without costs to any party; if the decision of the
    United States District Court for the Northern District
    of California issued on November 21, 2001 is
    affirmed, finally, then [Gator] shall pay L. L. Bean
    an additional $10,000; in the event the decision of
    the United States District Court for the Northern Dis-
    trict of California issued on November 21, 2001 is
    not affirmed, finally, no payment shall be owed to
    any party.

Settlement Agreement ¶ 3.2.

   After reviewing the settlement agreement, we issued an
order to show cause why this appeal should not be dismissed
as moot. Both parties have submitted responses opposing dis-
missal.

                               II

   [1] It is an inexorable command of the United States Con-
stitution that the federal courts confine themselves to deciding
actual cases and controversies. See U.S. CONST. art. III, § 2,
cl. 1. For a case to fall within the parameters of our limited
1840          GATOR.COM CORP. v. L.L. BEAN, INC.
judicial power, “it is not enough that there may have been a
live case or controversy when the case was decided by the
court whose judgment we are reviewing.” Burke v. Barnes,
479 U.S. 361, 363 (1987). Rather, Article III requires that a
live controversy persist throughout all stages of the litigation.
See Steffel v. Thompson, 415 U.S. 452, 459 n.10 (1974) (“an
actual controversy must be extant at all stages of review, not
merely at the time the complaint is filed”). Where this condi-
tion is not met, the case has become moot, and its resolution
is no longer within our constitutional purview. See Foster v.
Carson, 347 F.3d 742, 747 (9th Cir. 2003) (“We do not have
the constitutional authority to decide moot cases.”). Because
“[m]ootness is a jurisdictional issue,” id. at 745, we are
obliged to raise it sua sponte. See Demery v. Arpaio, 378 F.3d
1020, 1025 (9th Cir. 2004).

    [2] The limitations that Article III imposes upon federal
court jurisdiction are not relaxed in the declaratory judgment
context. Indeed, the case-or-controversy requirement is incor-
porated into the language of the very statute that authorizes
federal courts to issue declaratory relief. See 28 U.S.C. § 2201
(“In a case of actual controversy within its jurisdiction, . . .
any court of the United States, upon the filing of an appropri-
ate pleading, may declare the rights and other legal relations
of any interested party seeking such declaration . . . .”
(emphasis added)). The “test for mootness in the context of a
case, like this one, in which a plaintiff seeks declaratory relief
. . . is ‘whether the facts alleged, under all the circumstances,
show that there is a substantial controversy, between parties
having adverse legal interests, of sufficient immediacy and
reality to warrant the issuance of a declaratory judgment.’ ”
Biodiversity Legal Found. v. Badgley, 309 F.3d 1166, 1174-
75 (9th Cir. 2002) (quoting Md. Cas. Co. v. Pac. Coal & Oil
Co., 312 U.S. 270, 273 (1941)). Stated another way, the
“ ‘central question’ ” before us is “ ‘whether changes in the
circumstances that prevailed at the beginning of litigation
have forestalled any occasion for meaningful relief.’ ” West v.
Sec’y of the Dep’t of Transp., 206 F.3d 920, 925 n.4 (9th Cir.
              GATOR.COM CORP. v. L.L. BEAN, INC.            1841
2000) (quoting 13A Charles Alan Wright, Arthur R. Miller &
Edward H. Cooper, Federal Practice and Procedure
§ 3533.3, at 268 (1984)).

                               A

   [3] The Supreme Court has repeatedly held that the requi-
site case or controversy is absent where a plaintiff no longer
wishes—or is no longer able—to engage in the activity con-
cerning which it is seeking declaratory relief.

   In Golden v. Zwickler, 394 U.S. 103, 105-06 (1969), for
example, the plaintiff sought a declaratory judgment that it
was unconstitutional for the State of New York to prohibit
him from distributing anonymous election leaflets about a
specific member of Congress seeking re-election. The
Supreme Court dismissed the case as moot because, after the
case was brought, the member of Congress in question was
appointed to serve as a state court judge. Id. at 109-10. The
plaintiff was thus no longer able to engage in the electioneer-
ing activity about which he had requested declaratory relief.
Id. at 109.

   Similarly, in Steffel v. Thompson, 415 U.S. at 454-55, the
plaintiff sought a declaratory judgment that a state criminal
trespass statute was being applied in a manner that deprived
him of his First Amendment right to distribute handbills pro-
testing the Vietnam War. After the suit was filed, however,
the United States sharply decreased its military presence in
Southeast Asia. Id. at 460. The Court therefore instructed the
district court to determine on remand whether this develop-
ment had neutralized the petitioner’s desire to engage in hand-
billing and thereby mooted the case. See id. (“it will be for the
District Court on remand to determine if subsequent events
have so altered petitioner’s desire to engage in handbilling at
the shopping center that it can no longer be said that this case
presents a substantial controversy” (internal quotation marks
omitted)).
1842             GATOR.COM CORP. v. L.L. BEAN, INC.
   We have confronted similar cases. In Blair v. Shanahan, 38
F.3d 1514, 1519-20 (9th Cir. 1994), for example, we
expressly relied upon Golden and Steffel to dismiss an appeal
as moot. There, the plaintiff sought a declaratory judgment
invalidating a California statute banning aggressive panhan-
dling. Id. at 1516-17. Although the plaintiff had previously
been a panhandler, by the time that he filed suit he had
obtained employment and had thus stopped begging for
money. Id. at 1517. In concluding that these changed circum-
stances mooted the case, we explained that “Blair lacks the
personal stake necessary to litigate his request for a declara-
tory judgment because he no longer wishes to engage in the
activity proscribed by the statute that he is challenging.” Id.;
see also Sellers v. Regents of the Univ. of Cal., 432 F.2d 493,
500 (9th Cir. 1970) (holding that an actual controversy was
absent where a request for a declaratory judgment invalidating
a university resolution governing the public use of school
facilities was brought by plaintiffs who did not intend to hold
any future gatherings in those facilities); cf. RK Ventures, Inc.
v. City of Seattle, 307 F.3d 1045, 1056-57 (9th Cir. 2002)
(concluding that the plaintiffs lacked standing to request a
declaratory judgment invalidating a city noise ordinance
because they no longer owned the night club that had previ-
ously been subject to the ordinance).3
  3
    Because Golden and Blair involve a plaintiff’s cessation of the conduct
about which declaratory relief is being sought, they are consistent with
other decisions in which we have found a live controversy even after the
defendant unilaterally discontinued the activity that prompted the plaintiff
to file suit. See, e.g., Jacobus v. Alaska, 338 F.3d 1095, 1103 (9th Cir.
2003) (“a defendant’s voluntary cessation of a challenged practice does
not deprive a federal court of its power to determine the legality of the
practice” (internal quotation marks omitted)). Indeed, defendants who
argue that a case has been mooted by their voluntary cessation of allegedly
wrongful conduct must meet a very high burden because a mootness-based
dismissal would “leave the defendant . . . free to return to his old ways.”
Fed. Trade Comm’n v. Affordable Media, LLC, 179 F.3d 1228, 1238 (9th
Cir. 1999) (alteration in original; internal quotation marks omitted). This
consideration is absent where the plaintiff voluntarily discontinues the
activity concerning which it is seeking declaratory relief. Cf. id. at 1237
(while “the victim can moot her need for injunctive relief by her own con-
duct, . . . the alleged wrongdoer can not moot the need for injunctive relief
as easily”).
              GATOR.COM CORP. v. L.L. BEAN, INC.            1843
                               B

   [4] The lessons of Golden and its progeny guide our moot-
ness inquiry in this case. Here, Gator filed suit to obtain a
declaratory judgment that its practice of placing pop-up
advertisements on L. L. Bean’s website did not constitute
copyright infringement, false advertising, trademark dilution,
or unfair competition. In accordance with the parties’ settle-
ment agreement, however, Gator has since permanently dis-
continued its use of pop-up advertisements on L. L. Bean’s
website. Like the ex-handbiller in Golden and the one-time
panhandler in Blair, Gator is therefore unable to obtain a
declaratory judgment because it “no longer wishes to engage
in the activity” concerning which it initially sought declara-
tory relief. Blair, 38 F.3d at 1520. The unavailability of
declaratory relief is reinforced by the fact that L. L. Bean has
released Gator from all liability associated with the pop-up
advertisements previously displayed on L. L. Bean’s website.
See Super Sack Mfg. Corp. v. Chase Packaging Corp., 57
F.3d 1054, 1059 (Fed. Cir. 1995) (holding that a patent hold-
er’s renunciation of all infringement claims arising from the
products currently manufactured by a competitor mooted the
competitor’s request for a declaratory judgment of patent
invalidity).

   [5] Because the parties’ settlement agreement has wholly
eviscerated the dispute that prompted Gator to initiate this
suit, Gator’s request for declaratory relief no longer gives rise
to a live case or controversy. See Headwaters, Inc. v. Bureau
of Land Mgmt., 893 F.2d 1012, 1015 (9th Cir. 1989) (“A case
or controversy exists justifying declaratory relief only when
the challenged . . . activity . . . has not evaporated or disap-
peared” (internal quotation marks omitted)).

                               C

  [6] Notwithstanding the fact that Gator is now ineligible for
declaratory relief, the parties argue that a live controversy
1844          GATOR.COM CORP. v. L.L. BEAN, INC.
remains before us because the settlement agreement requires
Gator to pay L. L. Bean $10,000 if we affirm the district
court’s jurisdictional dismissal. Although several decisions
have indeed found the existence of a live controversy after the
parties entered into a contingent settlement agreement, those
decisions are not controlling on the facts before us.

   In Havens Realty Corp. v. Coleman, 455 U.S. 363, 367
(1982), for example, the plaintiffs requested monetary—as
well as declaratory and injunctive—relief under the Fair
Housing Act. After the court of appeals held that the plaintiffs
had standing to pursue their claim, the parties agreed that the
plaintiffs would receive $400 and no further relief if the
Supreme Court denied certiorari or granted certiorari and
affirmed; if the Court granted certiorari and reversed, neither
party would owe the other anything. Id. at 371. The Court
held that the case was not moot because the settlement agree-
ment merely liquidated the monetary damages that the plain-
tiffs had been seeking all along. See id. (emphasizing that the
plaintiffs “continue to seek damages to redress alleged viola-
tions of the Fair Housing Act”).

   Similarly, in Nixon v. Fitzgerald, 457 U.S. 731, 739-40
(1982), the plaintiff sought civil damages from former Presi-
dent Nixon on the ground that he had been terminated from
his Air Force job as a result of impermissible government
retaliation. After the court of appeals ruled that Nixon was not
entitled to absolute immunity, the parties agreed that the
plaintiff would receive $28,000 if the Supreme Court deter-
mined that the President was not entitled to absolute immu-
nity and no payment if the Court concluded otherwise. Id. at
743-44. The Court relied upon Havens to hold that the case
was not moot. Id. at 744.

   [7] Havens and Nixon can be readily distinguished from
the instant case because neither decision is a declaratory judg-
ment action. Instead, both cases involve plaintiffs who were
seeking monetary damages and who agreed to accept a liqui-
                GATOR.COM CORP. v. L.L. BEAN, INC.                   1845
dated payment if they prevailed on appeal. The contingent set-
tlement agreements therefore preserved a live controversy
because they afforded these plaintiffs the opportunity to
obtain meaningful monetary relief—the very type of relief
that they sought to recover by filing suit in the first place. In
contrast, Gator initiated this suit to obtain a declaratory judg-
ment, but we can no longer grant that relief because Gator has
agreed to terminate its pop-up advertisements and has been
released from liability for its past conduct. Thus, unlike in
Havens and Nixon, the contingent payment for which the par-
ties’ settlement provides does not preserve Gator’s ability to
recover any of the relief upon which this suit was initially
premised.

   Because we can no longer award Gator any meaningful
relief, the personal jurisdiction issue upon which the $10,000
payment hinges is a mere vestige of the parties’ now extin-
guished dispute. See In re Pattullo, 271 F.3d 898, 901 (9th
Cir. 2001) (“If an event occurs while a case is pending on
appeal that makes it impossible for the court to grant any
effectual relief whatever to a prevailing party, the appeal is
moot and must be dismissed . . . .” (internal quotation marks
omitted)). Although the parties have negotiated a “side bet”
concerning our resolution of this appeal, that wager does not
alter the fact that the personal jurisdiction issue is wholly
divorced from any live case or controversy.4
  4
    The settlement agreement also provides that Gator must move to dis-
miss the appeal if L. L. Bean so requests, and it is therefore conceivable
that L. L. Bean could have compelled Gator to seek a dismissal if our reso-
lution of the personal jurisdiction issue had been unfavorable to L. L.
Bean. The fact that the settlement may endow L. L. Bean with the author-
ity to control the outcome of this appeal bolsters our conclusion that we
are not confronted by adverse parties litigating an actual controversy. We
do not, however, express any views regarding whether we are obliged to
grant an unopposed motion to dismiss filed after an opinion is announced
but before the mandate is issued. But see Okla. Radio Assocs. v. FDIC, 3
F.3d 1436, 1444 (10th Cir. 1993) (refusing to grant such a motion).
1846          GATOR.COM CORP. v. L.L. BEAN, INC.
                              III

   [8] There is no live controversy before us because the par-
ties’ settlement agreement has resolved all facets of their dis-
pute and has thereby mooted this appeal. If we were to reach
the merits of the personal jurisdiction issue that remains
before us, we would run squarely afoul of the Supreme
Court’s admonition “to avoid advisory opinions on abstract
propositions of law.” Hall v. Beals, 396 U.S. 45, 48 (1969);
see also Thomas v. Anchorage Equal Rights Comm’n, 220
F.3d 1134, 1138 (9th Cir. 2000) (en banc) (“Our role is nei-
ther to issue advisory opinions nor to declare rights in hypo-
thetical cases, but to adjudicate live cases or controversies
consistent with the powers granted the judiciary in Article III
of the Constitution.”).

   In undertaking our mootness inquiry, we have not over-
looked the fact that the judicial system has already invested
significant resources in this case. “To abandon the case at an
advanced stage may prove more wasteful than frugal,” and a
flexible application of the mootness doctrine may therefore be
appropriate. Friends of the Earth, Inc. v. Laidlaw Envtl.
Servs., Inc., 528 U.S. 167, 191-92 (2000). While mootness
analysis must therefore eschew undue formalism, it must nev-
ertheless operate within the well-defined contours of Article
III. The Supreme Court has accordingly explained that this
“argument from sunk costs [to the judiciary] does not license
courts to retain jurisdiction over cases in which one or both
of the parties plainly lacks a continuing interest, as when the
parties have settled.” Id. at 192 (emphasis added; footnote
omitted).

   Because the bounds of our judicial power cannot be over-
stepped for the sake of expediency, we must await another
opportunity to resolve the important issues of personal juris-
diction originally raised by this appeal. Although it is emphat-
ically the province of the judiciary “to say what the law is,”
Marbury v. Madison, 5 U.S. 137 (1 Cranch) 137, 177 (1803),
              GATOR.COM CORP. v. L.L. BEAN, INC.             1847
the Constitution is equally emphatic that we may do so only
in the course of deciding a live case or controversy.

  DISMISSED.

TASHIMA, Circuit Judge, with whom RYMER and
McKEOWN, Circuit Judges, join, concurring:

   Even assuming that the dissent is correct that the parties
continue to contest — with a monetary stake in the outcome
— the issue of personal jurisdiction, that does not amount to
an Article III “case or controversy.” The case or controversy
at stake in this litigation was whether Gator’s pop-up ad pro-
gram violated L.L. Bean’s trademark and other primary
rights. As the court concludes — and the dissent does not
challenge — that controversy has been concluded by the set-
tlement agreement.

   The remaining “controversy” of whether the California
courts can assert personal jurisdiction over L.L. Bean will set-
tle no dispute between the parties involving any of their pri-
mary rights. For it involves only the subsidiary, threshold
issue of whether a California court has the power to adjudi-
cate the parties’ dispute. But, under the settlement agreement,
no dispute — no case or controversy — involving any of the
parties’ primary rights remains. Thus, as the court’s opinion
aptly states, the $10,000 is truly only a “side bet.” If we were
to hold that the district court could assert personal jurisdiction
over L.L. Bean, there remains no case or controversy over
which that hypothetical jurisdiction could be asserted.

   For these reasons, this case differs from Havens Realty
Corp. v. Coleman, 455 U.S. 363 (1982), and Nixon v. Fitzger-
ald, 457 U.S. 731 (1982), the two cases on which the dissent
primarily relies. In both of those cases, recovery of the
reserved, contingent payment would vindicate a primary right
1848              GATOR.COM CORP. v. L.L. BEAN, INC.
of the plaintiff — in Havens, as damages for violation of the
plaintiffs’ rights under the Fair Housing Act, 455 U.S. at 371
(“[R]espondents continue to seek damages to redress alleged
violations of the Fair Housing Act. The letter agreement . . .
would merely liquidate those damages.”), and in Fitzgerald,
as damages for the wrongful termination of the plaintiff’s
employment, 457 U.S. at 743-44 (characterizing the settle-
ment agreement as “an agreement to liquidate damages,” and
citing Havens).1 Here, the outcome of the side bet would
determine only whether the district court hypothetically could
adjudicate a no-longer-existent dispute. No Article III case or
controversy remains.

  With this additional observation, I fully concur in Judge
O’Scannlain’s opinion for the court.

W. FLETCHER, Circuit Judge, with whom GRABER and
PAEZ, Circuit Judges, join, dissenting:

   The majority concludes that this appeal is moot because
“the parties’ settlement agreement has resolved all facets of
their dispute.” Maj. Op. at 1846. This is not true. One “facet[ ]
of their dispute” — indeed, the only question at issue in the
appeal — has not been resolved.
  1
    The dissent also relies on our cases asserting jurisdiction to decide
attorneys’ fees and costs after a case is settled and contends that if this
case is moot, those cases, Ass’n of Cal. Water Agencies v. Evans, 386 F.3d
879 (9th Cir. 2004), and Zucker v. Occidental Petroleum Corp., 192 F.3d
1323 (9th Cir. 1999), were “wrongly decided.” But, as the dissent’s quota-
tion from Zucker itself makes clear, costs and fees clearly come under the
district court’s ancillary jurisdiction. See id. at 1329 (noting that attorneys’
fees “are but an ancillary matter over which the district court retains equi-
table jurisdiction even when the underlying case is moot”). The dissent
does not contend that the remaining “controversy” here over personal
jurisdiction comes under the court’s ancillary jurisdiction.
              GATOR.COM CORP. v. L.L. BEAN, INC.           1849
   The parties continue to dispute whether a federal district
court in California has personal jurisdiction over L.L. Bean.
They have disputed this since the beginning of this litigation.
Both parties had, and still have, an interest in our resolution
of that dispute. Depending on how we resolve it, either Gator
owes L.L. Bean $10,000 or it does not. Nothing more is
required for our continuing jurisdiction.

                               I

   Gator sued L.L. Bean in the United States District Court for
the Northern District of California seeking a declaratory judg-
ment that its pop-up ads did not infringe L.L. Bean’s trade-
mark or other proprietary rights, and that it was not engaging
in any unfair or deceptive trade practices. L.L. Bean is a
Maine corporation with its principal place of business in
Maine. It advertises in California, both by mail and over the
internet, and it sells significant quantities of retail merchan-
dise to consumers in California. However, L.L. Bean owns no
property in California and has no employees based in Califor-
nia. The district court granted L.L. Bean’s motion to dismiss
for lack of personal jurisdiction. A three-judge panel of this
court reversed, holding that L.L. Bean’s activities conferred
general (not merely specific) jurisdiction in California. We
vacated the panel decision and took the appeal en banc. After
the appeal had been briefed and argued to the en banc panel,
and after a draft opinion had been circulated, the parties
entered into a partial settlement agreement.

   Under the agreement, Gator agreed to cease using the pop-
up ads and to pay L.L. Bean a substantial monetary settle-
ment. In return, L.L. Bean agreed to release Gator from any
further liability. Gator also agreed to pay L.L. Bean an addi-
tional $10,000 if we hold that it improperly sued L.L. Bean
in California. If we hold that its suit was proper, Gator owes
no additional money.
1850          GATOR.COM CORP. v. L.L. BEAN, INC.
                               II

   For an Article III court to have jurisdiction, “an actual con-
troversy must be extant at all stages of review, not merely at
the time the complaint is filed.” Steffel v. Thompson, 415 U.S.
452, 459 n.10 (1974). When an actual controversy ceases to
be present, a case is moot, and it is properly dismissed for
lack of jurisdiction. Mootness has sometimes been referred to
as the “doctrine of standing set in a time frame.” U.S. Parole
Comm’n v. Geraghty, 445 U.S. 388, 397 (1980). But the
Supreme Court recently noted in Friends of the Earth, Inc. v.
Laidlaw Environmental Services, 528 U.S. 167 (2000), that
this phrase is misleading, for it suggests that the personal
stake necessary to support jurisdiction is the same for both
standing and mootness. The Court made clear in Laidlaw that
this is not so. The Court emphasized that mootness is a more
flexible doctrine than standing, and that mootness should
cause a waste of judicial resources by dismissal of cases that
have been fully litigated in lower courts. Under Laidlaw, an
interest that would not support standing at the beginning of a
suit may well be sufficient to avoid mootness in the late
stages of a suit.

  The Court wrote:

        Standing doctrine functions to ensure, among
    other things, that the scarce resources of the federal
    courts are devoted to those disputes in which the par-
    ties have a concrete stake. In contrast, by the time
    mootness is an issue, the case has been brought and
    litigated, often (as here) for years. To abandon the
    case at an advanced stage may prove more wasteful
    than frugal. This argument from sunk costs [to the
    judicial system] does not license courts to retain
    jurisdiction over cases in which one or both of the
    parties plainly lacks a continuing interest, as when
    the parties have settled or a plaintiff pursuing a non-
    surviving claim has died. But the argument surely
              GATOR.COM CORP. v. L.L. BEAN, INC.              1851
    highlights an important difference between the two
    doctrines. See generally Honig v. Doe, 484 U.S. 305,
    329-332 (1988) (REHNQUIST, C.J., concurring).

Id. at 191-92 (some citations omitted). Chief Justice Rehn-
quist, in the concurrence cited by the Court in Laidlaw, spe-
cifically argued for a relaxed view of mootness. He wrote:

    The logical conclusion to be drawn from these cases,
    and from the historical development of the principle
    of mootness, is that while an unwillingness to decide
    moot cases may be connected to the case or contro-
    versy requirement of Art. III, it is an attenuated con-
    nection that may be overridden where there are
    strong reasons to override it.

Honig, 484 U.S. at 331 (1988) (Rehnquist, C.J., concurring).

   Under Laidlaw, a case is moot only when “one or both of
the parties plainly lacks a continuing interest” in the outcome
of the litigation. In this case, the parties retain a monetary
interest of $10,000 in the outcome of the jurisdictional appeal.
The Supreme Court has twice held that a contingent payment
of this kind is sufficient to save an appeal from mootness. In
Havens Realty Corp. v. Coleman, 455 U.S. 363 (1982), a
black “tester” and his employer sued a realty company and
one of its employees for “racial steering” in violation of the
federal Fair Housing Act. Plaintiffs were dismissed by the dis-
trict court for lack of Article III standing. The court of appeals
reversed, and the defendants sought certiorari on the jurisdic-
tional question of standing.

   While the certiorari petition was pending, the parties
reached a partial settlement agreement. If the Supreme Court
denied certiorari, or granted certiorari and affirmed, the plain-
tiffs would each receive $400. If, on the other hand, the Court
granted certiorari and reversed, plaintiffs would get nothing.
In other words, if the plaintiffs were right that the district
1852           GATOR.COM CORP. v. L.L. BEAN, INC.
court had jurisdiction, they would each get $400. If they were
wrong, they would get nothing. The Supreme Court held that
the defendants’ contingent obligation to pay each plaintiff
$400 saved the case from mootness: “If respondents have suf-
fered an injury that is compensable in money damages, the
fact that they have settled on a measure of damages does not
make their claims moot.” 455 U.S. at 371.

   In Nixon v. Fitzgerald, 457 U.S. 731 (1982), decided the
same Term, plaintiff Fitzgerald sued President Nixon and
other executive branch officials for damages, contending that
the defendants had unlawfully retaliated against him for testi-
mony he had given to a congressional committee. President
Nixon contended that he was protected from suit by absolute
official immunity, and that the suit should be dismissed.
Absolute immunity “is an immunity from suit rather than a
mere defense to liability; . . . it is effectively lost if a case is
erroneously permitted to go to trial.” Mitchell v. Forsyth, 472
U.S. 511, 526 (1985) (emphasis in original). The district court
and court of appeals rejected this defense, and the Supreme
Court granted certiorari. While the certiorari petition was
pending, Fitzgerald and Nixon had reached a partial settle-
ment agreement under which Nixon paid Fitzgerald $142,000.
If the Court held that Fitzgerald’s suit could go forward, he
would receive an additional $28,000. However, if his suit was
dismissed, he would receive no additional money. Citing
Havens Realty, the Court held that the contingent obligation
to pay $28,000 saved the appeal from mootness: “The limited
agreement between the parties left both petitioner and respon-
dent with a considerable financial stake in the resolution of
the question presented in this Court.” Id. at 744.

  The Third Circuit has addressed this issue twice, holding
both times that contingent obligations to pay money saved
appeals from mootness. In Keefe v. Prudential Property and
Casualty Insurance Co., 203 F.3d 218 (3rd Cir. 2000), the
parties entered into a partial settlement while the case was on
appeal:
              GATOR.COM CORP. v. L.L. BEAN, INC.            1853
    Prudential has agreed to pay Keefe one amount if
    Prudential’s argument prevails; a second (and
    higher) amount if we do not decide the issue; and a
    third (and still higher) amount if Keefe’s argument
    prevails.

Id. at 223. Citing Havens Realty, the court held that the partial
settlement did not moot the appeal. It wrote that the parties’
“positions are truly adverse with respect to the critical legal
issue that they ask us to resolve, and the dispute between them
is not feigned.” Id. at 224.

   In Wheeling-Pittsburgh Steel Corp. v. United Steel Workers
of America, 791 F.2d 1074 (3rd Cir. 1986), Wheeling-
Pittsburgh Steel declared bankruptcy. As debtor-in-possession
it received permission from the bankruptcy court to reject its
collective bargaining agreements. The district court affirmed,
and the Steel Workers’ union appealed. While the appeal was
pending, the parties agreed to modify the collective bargain-
ing agreement, thereby settling almost all of their dispute.
Only a dispute over a relatively small amount owed to plant
guards remained. The part of the dispute that was settled was
worth about $360,000,000; the dispute over the guards’ pay
was worth about $146,000. The court recognized that the con-
tingent obligation of $146,000 was a means to get an appel-
late decision on Wheeling-Pittsburgh’s ability to reject a
collective bargaining agreement. Nonetheless, citing Havens
Realty and Fitzgerald, the court held that the continuing dis-
pute about the guards’ pay was not a “mere contrivance.” Id.
at 1079. “Although the Union has candidly admitted that it
has an interest in securing a ruling on the merits above and
beyond the satisfaction of the plant guards’ claims, its moti-
vating interest in securing a precedent does not render the
case nonjusticiable as long as there are, in fact, stakes at
issue.” Id. at 1080.

   Gator and L.L. Bean remain adverse on the personal juris-
diction question. They litigated this question vigorously in the
1854          GATOR.COM CORP. v. L.L. BEAN, INC.
district court; they litigated it vigorously before the three-
judge panel; and they litigated it vigorously before the en
banc panel. They both contend, in their post-argument briefs
to the en banc panel, that they continue to be adverse and that
Gator’s appeal is not moot.

   The parties have a jurisdictional question about which they
are in vigorous disagreement, and they have a financial stake
in its resolution. This is all that is required under Havens
Realty, Fitzgerald, Keefe, and Wheeling-Pittsburgh Steel.
Indeed, this case is remarkably similar to both Havens Realty
and Fitzgerald, in which relatively small contingent payments
were enough to save appeals on the jurisdictional and quasi-
jurisdictional questions of standing and official immunity
from suit. In the words of the Supreme Court, this appeal
presents a controversy that is “definite and concrete, touching
the legal relations of parties having adverse legal interests”
Havens Realty, 455 U.S. at 371. Accordingly, it is not moot.

                              III

                              A

   The majority concludes that L.L. Bean’s appeal is moot
because Gator sought a declaratory judgment, and because the
partial settlement eliminated the need for that remedy when
Gator agreed to cease using pop-ups. According to the major-
ity, the Supreme Court has “repeatedly held that the requisite
case or controversy is absent where a plaintiff no longer
wishes — or is no longer able — to engage in the activity
concerning which it is seeking relief.” Maj. Op. at 1841. The
majority principally relies on two Supreme Court cases.

   The most recent is Steffel v. Thompson, 415 U.S. 452
(1974). Plaintiff sought a declaratory judgment that he could
not be criminally prosecuted for leafleting at a shopping cen-
ter against the Vietnam War and United States foreign policy
in Southeast Asia. The Supreme Court took the case to
              GATOR.COM CORP. v. L.L. BEAN, INC.          1855
resolve an unsettled issue of equitable abstention under Youn-
ger v. Harris, 401 U.S. 37 (1971). The Court decided the case
in 1974. The last United States troops left Vietnam in late
March 1973. Referring to “recent developments reducing the
Nation’s involvement in that part of the world,” the Court
remanded to the district court for a determination whether
there was “a substantial controversy, between parties having
adverse legal interests, of sufficient immediacy and reality to
warrant the issuance of a declaratory judgment.” Steffel, 415
U.S. at 460 (internal quotation omitted). Given the withdrawal
of United States troops and the end of the war, it was most
unlikely that Steffel had a continuing interest in leafleting
against the war and United States policy in Southeast Asia.
Notwithstanding this, the court did not hold his appeal moot.
Before remanding, the Court decided the merits of the Youn-
ger issue presented in the appeal.

   The other case is Golden v. Zwickler, 394 U.S. 103 (1969),
decided five years before Steffel. Zwickler had sought a
declaratory judgment that a New York statute prohibiting the
distribution of anonymous campaign literature was unconsti-
tutional. By the time the appeal came before the Supreme
Court, the congressman whom Zwickler had opposed was no
longer in Congress and was “most unlikely” to run again. Id.
at 109. Under these circumstances, the Court held that there
was no longer a case or controversy under Article III.

   There is an obvious tension between Steffel and Zwickler,
and the status of Zwickler as a precedent may be in some
doubt. However, even assuming that Steffel and Zwickler can
be reconciled and that both cases are good law, neither case
answers the mootness question here. In neither Steffel nor
Zwickler — nor indeed in any declaratory judgment case cited
by the majority — did the parties ever seek anything other
than a declaratory judgment. In none of the cases cited by the
majority did the parties enter into a partial settlement agree-
ment, and in none of these cases did a monetary stake depend
on the resolution of the appeal.
1856           GATOR.COM CORP. v. L.L. BEAN, INC.
                                B

   Declaratory judgments are often inverted lawsuits. That is,
the plaintiff seeking the declaratory judgment is often the
party who would be the defendant in a coercive suit for dam-
ages or an injunction. Such was the case here. Gator, the
declaratory judgment plaintiff, had no claim for damages or
injunctive relief against L.L. Bean. Rather, L.L. Bean was the
party with claims for damages and injunctive relief. In a case
like this one, the declaratory judgment is little more than a
forum choice device, permitting a would-be defendant in a
damages and injunction suit to litigate in a favorable forum.

   It is immaterial for purposes of our jurisdiction that this suit
initially took the form of a declaratory judgment suit by Gator
rather than a coercive suit for damages and an injunction by
L.L. Bean. As the Supreme Court wrote in Maryland Casualty
Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 273 (1941) (cita-
tions omitted, emphasis added):

    [T]he question in each [declaratory judgment] case is
    whether the facts alleged, under all the circum-
    stances, show that there is a substantial controversy,
    between the parties having adverse legal interests, of
    sufficient immediacy and reality to warrant the issu-
    ance of a declaratory judgment. It is immaterial that
    frequently, in the declaratory judgment suit, the
    positions of the parties in the conventional suit are
    reversed; the inquiry is the same in either case.

Gator’s suit is not only about declaratory relief. If there is per-
sonal jurisdiction over L.L. Bean in California, as the three-
judge panel held, it is inescapably also about damages and
injunctive relief.

   If the federal district court in California had personal juris-
diction over L.L. Bean, as the three-judge panel held it did,
L.L. Bean would have been forced to bring its suit for dam-
              GATOR.COM CORP. v. L.L. BEAN, INC.            1857
ages and injunctive relief as a compulsory counterclaim. See,
e.g., Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 508
(1959) (noting in a declaratory judgment action that a coun-
terclaim would have been compulsory under Fed. R. Civ. P.
13(a)). The nature of the partial settlement entered into by
Gator and L.L. Bean clearly reflects the fact that, if the three-
judge panel was right, Gator’s declaratory judgment suit was
inevitably, as well, a countersuit for damages and injunctive
relief. Under the settlement, Gator agreed to make a substan-
tial monetary payment to L.L. Bean and agreed to cease deliv-
ering pop-up ads, just as it would have been required to do if
L.L. Bean had prevailed on its compulsory counterclaim for
damages and injunctive relief.

   The $10,000 contingent payment is not a “side bet” on our
determination of the jurisdictional issue. It is, instead, a con-
tingent monetary recovery for L.L. Bean, to be added to the
substantial recovery already received, if we hold that Gator
improperly sued L.L. Bean in California. This contingent
recovery approximates the court costs, and possibly attorneys’
fees, that Gator would owe if we affirmed the district court’s
dismissal of its suit.

   When the parties entered into their partial settlement agree-
ment, the following had occurred: The district court had dis-
missed Gator’s suit for want of personal jurisdiction. A three-
judge panel of this court had then reversed the district court,
holding that L.L. Bean is subject to general jurisdiction. We
then vacated the panel decision and took the appeal en banc.
Before we issued our en banc decision, the parties settled.
When they settled, it was entirely possible that we would
affirm the district court. If we had affirmed, this would have
triggered an award of costs and possibly attorneys’ fees.

   We routinely hear appeals of costs and of attorneys’ fees
awards when that is all that remains in dispute. For example,
in Miles v. California, 320 F.3d 986 (9th Cir. 2003), plain-
tiffs’ suit was dismissed under the Eleventh Amendment
1858          GATOR.COM CORP. v. L.L. BEAN, INC.
because the district court lacked jurisdiction. The district
court awarded costs of $12,238.64. We heard the plaintiffs’
appeal of the cost order even though the underlying case had
been dismissed. In Association of California Water Agencies
v. Evans, 386 F.3d 879 (9th Cir. 2004), plaintiffs’ suit was
dismissed as moot because the defendants ceased the activity
of which plaintiffs had complained. The district court
awarded attorneys’ fees of $304,530 and costs of $13,211 to
plaintiffs. We heard defendants’ appeal of the attorneys’ fees
award even though the underlying suit was moot.

   In this case, L.L. Bean would have been entitled to costs if
we had affirmed the district court’s dismissal. See 28 U.S.C.
§ 1919 (authorizing a district court to award just costs when
a case is dismissed for lack of jurisdiction). It may also have
been entitled to attorneys’ fees if we had affirmed. L.L. Bean
had sent a cease-and-desist letter to Gator, which prompted
Gator’s declaratory judgment suit. In that letter, L.L. Bean
had threatened Gator with suit, stating that a recovery of attor-
neys’ fees was likely: “Given that your conduct is clearly
intentional, it is also likely that L.L. Bean will recover its
attorneys’ fees in connection with any lawsuit brought in con-
nection with these claims.” Gator agreed that attorneys’ fees
were potentially at stake. Referring to L.L. Bean’s cease-and-
desist letter, it wrote in its complaint: “This litigation could
subject Plaintiff to liability for . . . attorneys’ fees.” See 15
U.S.C. §§ 1125(c)(2) and 1117(a) (attorneys’ fees in trade-
mark cases); Walker v. Countryside Home Loans, Inc., 121
Cal. Rptr. 2d 79, 94 (Cal. Ct. App. 2002) (explaining that
attorneys’s fees may be available in suits brought under Cali-
fornia’s unfair competition law pursuant to Cal. Civ. Pro.
Code § 1021.5).

   Given the virtual certainty of a cost award and the possibil-
ity of an attorneys’ fees award if we affirmed the district
court’s jurisdictional dismissal, the parties’ agreement to a
payment of $10,000 contingent on affirmance is readily
understandable. Under the partial settlement, Gator made a
              GATOR.COM CORP. v. L.L. BEAN, INC.             1859
substantial payment to L.L. Bean in return for a release from
further liability on the merits of L.L. Bean’s claims. Except
for the $10,000 contingent obligation, there was no provision
in the agreement for payment of court costs or attorneys’ fees.
The amount of such costs and fees was uncertain, particularly
given the need to discount the attorneys’ fees by the quite low
probability of their being awarded at all. In this circumstance,
the contingent obligation of Gator to pay L.L. Bean $10,000
reasonably approximates, and “liquidates,” costs and attor-
neys’ fees.

   The Supreme Court in Havens Realty specifically held that
such a liquidation in a settlement agreement saves the appeal
from mootness. Referring to the parties’ agreement in that
case that the defendant would pay $400 to each of the plain-
tiffs in the event the lower court’s jurisdictional dismissal was
reversed, the Court wrote:

    The . . . agreement . . . would merely liquidate those
    damages. If respondents have suffered an injury that
    is compensable in money damages of some undeter-
    mined amount, the fact that they have settled on a
    measure of damages does not make their claims
    moot.

455 U.S. at 371. Havens Realty is directly controlling in this
case. We know that costs and attorneys’ fees are a sufficient
basis for appeal, even when all other issues in a case have
been settled, dismissed, or mooted out. We also know that if
Gator and L.L. Bean had agreed to settle their appeal in all
respects but costs and attorneys’ fees, without specifying what
those amounts would be, we would have jurisdiction over the
appeal. The only difference is that they have liquidated those
amounts and settled on a figure of $10,000. Havens Realty
specifically tells us that such a liquidation does not moot an
otherwise proper appeal.

  Judge Tashima would distinguish Havens Realty and Fitz-
gerald by pointing out that in those cases recovery of the
1860          GATOR.COM CORP. v. L.L. BEAN, INC.
“contingent payment would vindicate a primary right of the
plaintiff.” In his view, once Gator and L.L.Bean settled their
underlying dispute, there was no longer any live controversy.
He writes:

       The remaining “controversy” of whether the Cali-
    fornia courts can assert personal jurisdiction over
    L.L.Bean will settle no dispute between the parties
    involving any of their primary rights. For it involves
    only the subsidiary, threshold issue of whether a Cal-
    ifornia court has the power to adjudicate the parties’s
    dispute.

Concurring op. at 1847. Judge Tashima relies on a newly for-
mulated distinction between “primary rights” and some other
kind of rights. But no such distinction exists in mootness law.
As long as there is a bona fide legal dispute, with tangible
consequences for the parties, there is a live controversy.

   As our own case law makes clear, we have jurisdiction to
decide an appeal where the parties have settled the merits of
their underlying dispute, but where they continue to disagree
on costs or attorneys’ fees. For example, in Zucker v. Occi-
dental Petroleum Corp., 192 F.3d 1323 (9th Cir. 1999), plain-
tiffs brought a securities class action in federal district court.
The merits of the suit were settled, but attorneys’ fees
remained in dispute. The parties did not dispute the amount
of fees, but whether fees were owed at all. In Judge Tashima’s
terminology, there were no longer any “primary rights” at
issue because the parties had settled their underlying dispute.
We nevertheless had no trouble understanding that the parties’
dispute over attorneys’ fees was not moot, and that we had
jurisdiction to decide it. In affirming the district court’s award
of attorneys’ fees, we wrote: “No Article III case or contro-
versy is needed with regard to attorneys’ fees as such, because
they are but an ancillary matter over which the district court
retains equitable jurisdiction even when the underlying case
is moot. Its jurisdiction outlasts the ‘case or controversy.’ ”
              GATOR.COM CORP. v. L.L. BEAN, INC.            1861
Id. at 1329. See also Association of California Water Agen-
cies, 386 F.3d 879 (deciding attorneys’ fees on appeal
although merits of the underlying suit had been rendered moot
by action of the defendant).

   Judge Tashima contends that because we referred in Zucker
to attorneys’ fees as an “ancillary matter,” we were exercising
“ancillary jurisdiction” in that case. Concurring op. at 1848,
n.1. From that, he concludes that we have no jurisdiction in
this case. But “ancillary matter” and “ancillary jurisdiction”
are not synonymous terms, and we did not say in Zucker that
we were exercising “ancillary jurisdiction.” Moreover, no
matter what label is attached, it is undisputed that we exer-
cised jurisdiction to decide whether or not attorneys’ fees
were owed in that case. That is what we are asked to decide
in this case. The only difference is that in this case the amount
is liquidated.

   The only question on which the district court ruled in this
case was whether it had personal jurisdiction over L.L. Bean.
That was the only question that was appealed to us. The par-
ties continue to dispute that question, and $10,000 depends on
our decision. The fact that the parties have settled the underly-
ing dispute does not affect our jurisdiction. To put it another
way, if the parties’ appeal has become moot because they
have settled their underlying dispute, our decisions in Zucker
and Association of California Water Agencies are wrongly
decided and must be overruled. Yet neither the majority opin-
ion nor Judge Tashima suggests that they disagree with these
decisions.

                               IV

   In Laidlaw, the Supreme Court explicitly cautioned against
finding cases moot at advanced stages of litigation when it
would be “more wasteful than frugal” to do so. 528 U.S. at
191-92. The majority quotes this passage, but fails to heed it.
The jurisdictional issue before us has been fully and vigor-
1862          GATOR.COM CORP. v. L.L. BEAN, INC.
ously litigated. The settlement was not reached until after
briefing and argument were complete. Indeed, it was not
reached until after a draft opinion had been circulated. Moot-
ness doctrine is intended to ensure that federal courts make
decisions with the benefits of a fully adversarial dispute. See
Geraghty, 445 U.S. at 397 (“The ‘personal stake’ aspect of
mootness doctrine also serves primarily the purpose of assur-
ing that federal courts are presented with disputes they are
capable of resolving.”). We have had every benefit the adver-
sarial process has to offer. If we find this appeal moot, we will
not be frugally guarding the scarce resources of the federal
courts. Rather, we will be wasting them in spectacular fash-
ion.

   The Court’s caution in Laidlaw was not a throwaway
remark. Rather, it was a considered statement, coming at the
end of a long line of cases in which the Supreme Court has
indicated that, more than standing and other Article III justi-
ciability doctrines, mootness has a strong prudential compo-
nent. One way the Court has made this evident is by carving
out numerous exceptions to mootness. An exception is made
for cases in which a party voluntarily ceases his offending
conduct, but remains “free to return to his old ways.” United
States v. W.T. Grant Co., 345 U.S. 629, 632 (1953). Another
exception is made for cases that involve wrongs that are “ca-
pable of repetition, yet evading review.” Moore v. Ogilvie,
394 U.S. 814, 816 (1969). Yet another exception is made in
class action suits, which are not mooted simply because the
named plaintiff’s case is moot. See, e.g., Sosna v. Iowa, 419
U.S. 393, 399 (1975).

  As Laidlaw underscores, the Supreme Court is moving
toward the prudential mootness doctrine advocated by Chief
Justice Rehnquist in his concurrence in Honig v. Doe. See
Laidlaw, 528 U.S. at 192 (citing Honig v. Doe, 484, 305, 329-
332 (1988) (Rehnquist, C.J., concurring)). Neither the Court
nor Chief Justice Rehnquist has yet indicated that they are
willing to follow state-court mootness practice. But I note that
               GATOR.COM CORP. v. L.L. BEAN, INC.             1863
almost every state in the union has an exception for cases on
appeal that raise questions of “continuing public importance”
when the events giving rise to mootness occur after the issue
has been fully litigated in the trial court. See, e.g., Comm. for
Rational Predator Mgmt. v. Dep’t of Agric., 931 P.2d 1188,
1191 (Idaho 1997) (“[I]f the issue is one of substantial public
interest, the Court may address the issue for future guidance
and direction even if the case is technically moot.”); Kona
Old Hawaiian Trails Group v. Lyman, 734 P.2d 161, 165
(Haw. 1987) (“[W]hen the question involved affects the pub-
lic interest, and it is likely in the nature of things that similar
questions arising in the future would likewise become moot
before a needed authoritative determination by an appellate
court can be made, an exception to the rule is justified.”)
(internal citation and quotation marks omitted); State v. Glus-
man, 651 P.2d 639, 643 (Nev. 1982) (“It is, however, within
the inherent discretion of this Court to consider issues of sub-
stantial public importance which are likely to recur, in spite
of any intervening event during the pendency of an appeal
which has rendered the matter moot.”); Witt v. Watkins, 579
P.2d 1065, 1071 n.19 (Alaska 1978) (“Where a resolution of
a particular question is of significant public interest, we may,
in our discretion, resolve it despite the fact that the parties
have settled their dispute.”); Sadowski v. Shevin, 345 So. 2d
330, 331-32 (Fla. 1977) (“Although the questions raised in
this case have become moot . . . we feel constrained to retain
jurisdiction and resolve the question . . . since this is a matter
of great public importance in the administration of the law
and is of general interest to the public.”); Leonard v. City of
Bothell, 557 P.2d 1306, 1308 (Wash. 1976) (“This court will,
however, review a case which has become moot if it involves
matters of substantial public interest.”); Liberty Mut. Ins. Co.
v. Fales, 505 P.2d 213, 215 (Cal. 1973) (“If an action involves
a matter of continuing public interest and the issue is likely
to recur, a court may exercise an inherent discretion to resolve
that issue, even though an event occurring during its pendency
would normally render the matter moot.”); People ex rel.
1864          GATOR.COM CORP. v. L.L. BEAN, INC.
Guggenheim v. Mucci, 298 N.E.2d 109, 110 (N.Y. 1973)
(“[A]n appeal should not be dismissed as moot if a question
of general interest and substantial public importance is likely
to recur.”); Ariz. Osteopathic Med. Ass’n v. Fridena, 463 P.2d
825, 826 (Ariz. 1970) (“We have previously held than an
appellate court has discretion to decide questions which have
become moot.”); State ex rel. Ronish v. Sch. Dist. No. 1 of
Fergus Co., 348 P.2d 797, 799-800 (Mont. 1960) (declining
to dismiss case as moot in part because it presented question
of “great public interest and concern”).

   We are, of course, not a state court but an Article III court
bound by the “case or controversy” requirement. But we
should not close our eyes to what the state courts are doing.
We should remember that for several decades at the beginning
of the last century, the state courts embraced declaratory judg-
ments while the federal courts still believed that a declaratory
judgment suit was not a “case or controversy.” See, e.g.,
Muskrat v. United States, 219 U.S. 346 (1911). Finally, per-
ceiving the great advantages of the declaratory judgment
device, and encouraged by the Supreme Court’s statements in
Nashville, C. & St. L. Ry. v. Wallace, 288 U.S. 249 (1933),
Congress passed the federal Declaratory Judgment Act in
1934. See 28 U.S.C. §2201; Aetna Life Ins. Co. v. Haworth,
300 U.S. 227 (1937) (upholding constitutionality of the Act).
This example reminds us that the federal courts are not the
only source of wisdom on matters of jurisdiction and justicia-
bility.

   Nor should we close our eyes to the enormous cost of hold-
ing cases moot based on events that occur in the last stages
of appeal. There is no doubt, to use the phrase commonly
used by the state courts, that this appeal presents a question
of “continuing public importance.” Litigants in this circuit
know that the district court in this case dismissed Gator’s suit
against L.L. Bean for lack of personal jurisdiction. They also
know that a three-judge panel of this court reversed the dis-
trict court, holding that there was general (not merely spe-
              GATOR.COM CORP. v. L.L. BEAN, INC.             1865
cific) jurisdiction over L.L. Bean in California. General
jurisdiction over L.L. Bean means that it can be sued in Cali-
fornia on any cause of action, irrespective of any connection
to the state. Under the three-judge panel’s holding, an L.L.
Bean employee who lives and works in Maine can sue L.L.
Bean in California for unpaid wages.

   We vacated the decision of the three-judge panel when we
took the appeal en banc, but the panel decision is in the Fed-
eral Reporter for anyone to read. See Gator.com Corp. v. L.L.
Bean, Inc., 341 F.3d 1072 (9th Cir. 2003). That decision no
longer has the force of law, but it is a clear statement by three
judges of this court that, in their view, there is general juris-
diction over L.L. Bean in California. I do not wonder, in light
of that decision, that L.L. Bean has been anxious to preserve
its right of appeal to the en banc panel, and that it specifically
structured its partial settlement with Gator in order to achieve
that result.

    If we were to decide the jurisdictional question that Gator
and L.L. Bean are both asking us to decide and on which
$10,000 depends, we would have the opportunity to harmo-
nize our personal jurisdiction decisions, including those upon
which the three-judge panel relied. See, e.g., Theo H. Davies
& Co., Ltd. v. Republic of the Marshall Islands, 174 F.3d 969
(9th Cir. 1998); Amoco Egypt Oil Co. v. Leonis Nav. Co., Inc.,
1 F.3d 848 (9th Cir. 1993); Shute v. Carnival Cruise Lines,
Inc., 897 F.2d 377 (9th Cir. 1990) overruled on other grounds
by Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585 (1991);
Gray & Co. v. Firstenberg Mach. Co., Inc., 913 F.2d 758 (9th
Cir. 1990); Bancroft & Masters, Inc. v. Augusta Nat. Inc., 223
F.3d 1082 (9th Cir. 2000). The disarray in our case law is
patent. How else to explain such dramatically different hold-
ings from our judges — one judge dismissing for lack of
jurisdiction and three judges holding that there is general
jurisdiction? It is not only the litigants in this case that would
benefit from an en banc opinion in this appeal. All potential
litigants in this circuit would benefit.
1866          GATOR.COM CORP. v. L.L. BEAN, INC.
                              V

   I do not need to rely on Laidlaw, on Chief Justice Rehn-
quist’s concurrence in Honig, on the increasing willingness of
the Supreme Court to treat mootness as a prudential doctrine,
or on the continuing public importance of the question pre-
sented in this appeal. Without any of those things, this appeal
is not moot. Under long-established Supreme Court case law
— Havens Realty and Fitzgerald, both decided in 1982 —
this case continues to present a live controversy sufficient to
support our jurisdiction.