Court Opinion

ID: 9494376
Source: CourtListenerOpinion
Date Created: 2023-08-05 15:36:42.7557+00
Date Added: 2024-06-11T17:56:23.016143
License: Public Domain

DYK, Circuit Judge,
dissenting.
Because I conclude that the district court did not retain jurisdiction over the settlement agreement, I dissent.
After nearly two years of proceedings, on June 6, 1991, the parties executed an agreement settling their claims which provided, inter alia, that if one party breached the agreement, “the other party shall have a right to bring a motion before this Court....” There is nothing in the record to suggest that the agreement was submitted to or reviewed by the district court. On July 8, 1991, the district court provisionally dismissed the case in an order stating in pertinent part that “[t]he court having been advised by counsel that the above action has been settled, IT IS ORDERED that this action is hereby dismissed, with prejudice, the court reserving jurisdiction for sixty (60) days to permit any party to move to reopen this action, for good cause shown, or to submit and file a stipulated form of final judgment.” Two days later, on July 10, 1991, the court approved the parties’ Stipulation that provided: “[pjursuant to a confidential Settlement Agreement, all claims in this action may be dismissed with prejudice and on the merits.... ” The district court’s Order of Dismissal accompanying the Stipulation stated: “The foregoing Stipulation is hereby approved and IT IS HEREBY ORDERED that a judgment of dismissal with prejudice be entered forthwith on all claims in the above action.” Eleven months later, on June 11, 1992, Schaefer moved the district court to enforce the settlement agreement. Contrary to the majority’s opinion, the language of neither the Stipulation and Order of Dismissal nor the parties’ Settlement Agreement is sufficient to confer continuing jurisdiction on the district court to enforce the settlement agreement.
In reaching a contrary result, the majority relies on cases predating the Supreme Court’s decision in Kokkonen v. Guardian Life Insurance Co. of America, 511 U.S. 375, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). See, e.g., Interspiro USA Inc. v. Figgie Int'l, Inc., 18 F.3d 927, 930 (Fed. Cir.1994); Halderman v. Pennhurst State Sch. & Hosp., 901 F.2d 311, 317 (3d Cir.), cert. denied, 498 U.S. 850, 111 S.Ct. 140, 112 L.Ed.2d 107 (1990). Kokkonen materially changed the judicial landscape. In Kokkonen, the parties settled their claims and counterclaims and recited the terms of their agreement on the record before the district judge. 511 U.S. at 376, 114 S.Ct. 1673. The parties then executed a Stipulation and Order of Dismissal with Preju*1292dice, which did not retain jurisdiction or refer to the settlement agreement. The district judge approved the stipulation. Id. at 377, 114 S.Ct. 1673. One month later, Guardian Life moved the district court to enforce the settlement agreement. The district court entered an enforcement order, asserting its “inherent power” to do so. The Supreme Court held that a federal district court, possessing only the limited jurisdiction authorized by the Constitution and by statute, lacked jurisdiction over an independent action for breach of the settlement agreement. Id. at 380-81, 114 S.Ct. 1673. However, the court also made clear that when the parties stipulate to the dismissal of a case and wish to provide the court with jurisdiction over the settlement, they may seek to do so. Id. at 381, 114 S.Ct. 1673. In such circumstances, “the court is authorized to embody the settlement contract in its dismissal order (or what has the same effect, retain jurisdiction over the settlement contract) if the parties agree.” Id. at 381-82, 114 S.Ct. 1673 (parentheses in original). In other words, the court has ancillary jurisdiction over the settlement contract if “the terms of the settlement agreement [have] been made part of the order of dismissal— either by separate provision (such as a provision ‘retaining jurisdiction’ over the settlement agreement) or by incorporating the terms of the settlement agreement in the order.” Id. at 381, 114 S.Ct. 1673 (parentheses in original, bracketed text added). However, “[t]he judge’s mere awareness and approval of the terms of the settlement agreement do not suffice to make them part of his. order.” Id.
We do not have here a situation in which the dismissal order incorporated the terms of the settlement agreement or retained jurisdiction over the agreement, but one in which the judge was merely aware that a settlement agreement existed. Thus, under Kokkonen, the district court did not retain jurisdiction.
Even if Interspiro and Halderman had survived Kokkonen, they are clearly distinguishable. The majority finds this case similar to Interspiro because there the settlement agreement provided that the district court would have “ ‘jurisdiction over the implementation of or disputes arising out of the settlement of this action,’ ” id. at 930, and here the parties’ agreement provided that a “party shall have a right to bring a motion before this Court” if the other party breached the agreement. It is, however, well-settled that “no action of the parties can confer subject-matter jurisdiction upon a federal court. Thus, the consent of the parties is irrelevant....” Ins. Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702, 102 S.Ct. 2099, 72 L.Ed.2d 492 (1982). In Interspiro, since “\t]he parties submitted the Settlement Agreement to the [district] Court with a Proposed Stipulated Order dismissing the case pursuant to the terms of the Agreement,” Interspiro, 815 F.Supp. 1488, 1497 (D.Del. 1993) (emphasis added), the settlement agreement was reviewed by the district court and made of record in the case. This court, therefore, properly found that the district court intended to retain jurisdiction over the settlement agreement by approving the agreement in its dismissal order, 18 F.3d at 930.
Here, because there is no evidence that the district court reviewed the settlement agreement or that it was aware of jurisdiction-granting language in the agreement, it cannot be said that the court intended to retain jurisdiction. Neither the settlement agreement nor any of its terms was entered into the record, and no terms of the agreement were incorporated into the dismissal order. There is no provision in the July 10, 1991, dismissal order providing the district court with continuing jurisdiction. The only mention of continuing jurisdiction is in the court’s July 8, 1991, *1293order which provided for jurisdiction only until September 6, 1991. From this it is inferable that the district court explicitly intended that its jurisdiction end on that date.
In Halderman, the dismissal of the class action provided: “that the Final Settlement Agreement is APPROVED, and IT IS FURTHER ORDERED that the provisions of the Final Settlement Agreement executed on July 12, 1984 heretofore made a part of the record in this case shall have the full force of law and effect of an order of this Court.” 901 F.2d at 317. Because the district court expressly incorporated the settlement agreement and gave notice that it was enforceable as an order of the court, the court retained jurisdiction to enforce it. Here, however, the district court did not make Schaefer’s and J & D’s settlement agreement an order of the court or incorporate any specific terms of the agreement.
In any event, this case is not governed by Third Circuit law, and Interspiro and Halderman have no relevance here. Rather, this case is governed by the law of the Eighth Circuit, and recent cases from the Eighth Circuit, decided after Kokko-nen, make clear that this Stipulation and Dismissal Order does not confer continuing jurisdiction. Miener v. Mo. Dep’t of Mental Health, 62 F.3d 1126, 1128 (8th Cir.1995) held that:
A dismissal order’s mere reference to the fact of settlement does not incorporate the settlement agreement in the dismissal order. Hagestad v. Tragesser, 49 F.3d 1430, 1432-33 (9th Cir.1995) (dismissal stating “action has been settled” did not incorporate terms of settlement agreement); see also Lucille v. City of Chicago, 31 F.3d 546, 548-49 (7th Cir.1994) (judgment stating it was “entered in accordance with” settlement agreement did not incorporate settlement).
Miener, 62 F.3d at 1128. Here, the parties’ stipulation stated only that it was “pursuant to a confidential Settlement Agreement,” and the court’s order only approved the stipulation and did not even mention the settlement agreement or any of its terms. The language used in the parties’ stipulation is quite similar to language of the judgment in Lucille, 31 F.3d at 548-49 (where the judgment order by its own terms was “entered in accordance with the Settlement Agreement”), which the Eight Circuit would find inadequate to incorporate the terms of a settlement agreement into the dismissal order. See also Gilbert v. Monsanto Co., 216 F.3d 695, 699 (8th Cir.2000) (finding that district court retained jurisdiction where Stipulation of Dismissal explicitly “incorporated” settlement agreement and provided that “this Court shall retain jurisdiction to enforce the terms of the settlement agreement.”)
While “magic words” are not required for a court to retain jurisdiction, the Eighth Circuit holdings in Gilbert and Miener clearly articulate the difference between language that can and cannot confer continuing jurisdiction on the district court over the enforcement of a settlement agreement. Here, the district court itself recognized this difference, as the July 8, 1991, order expressly retained jurisdiction over the case for a very limited period, while the July 10, 1991, dismissal order merely acknowledged the existence of the parties’ settlement agreement. In this case, the required retention of jurisdiction is entirely lacking.
For these reasons, I respectfully dissent.