Court Opinion

ID: 7643348
Source: CourtListenerOpinion
Date Created: 2022-07-29 22:00:36.330967+00
Date Added: 2024-06-11T16:25:23.137618
License: Public Domain

Appellate Case: 21-6146     Document: 010110718155         Date Filed: 07/29/2022     Page: 1
                                                                                     FILED
                                                                         United States Court of Appeals
                        UNITED STATES COURT OF APPEALS                           Tenth Circuit

                              FOR THE TENTH CIRCUIT                              July 29, 2022
                          _________________________________
                                                                            Christopher M. Wolpert
                                                                                Clerk of Court
  MONSTER TECHNOLOGY GROUP,
  LLC,

        Plaintiff - Appellant,

  v.                                                           No. 21-6146
                                                        (D.C. No. 5:21-CV-00879-J)
  GARRETT A. ELLER,                                            (W.D. Okla.)

        Defendant - Appellee.
                       _________________________________

                              ORDER AND JUDGMENT *
                          _________________________________

 Before TYMKOVICH, Chief Judge, MATHESON and EID, Circuit Judges.
                  _________________________________

        This matter is before the court on Appellant Monster Technology Group,

 LLC’s Motion to Dismiss Appeal on Grounds of Mootness and the Iowa Tribe of

 Oklahoma’s 1 Rule 38 Motion for Attorneys’ Fees and Costs. We grant both motions

 as set forth herein.

        *
         After examining the briefs and appellate record, this panel has determined
 unanimously that oral argument would not materially assist in the determination of
 this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
 ordered submitted without oral argument. This order and judgment is not binding
 precedent, except under the doctrines of law of the case, res judicata, and collateral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
 Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
        1
          Appellee Garrett Eller is party to this suit “in his official capacity” as a judge
 for the Iowa Tribe of Oklahoma. Aplt. App. at 8. The Iowa Tribe, and not Eller, is
 therefore the real party in interest. See McDonald v. Wise, 769 F.3d 1202, 1215
Appellate Case: 21-6146      Document: 010110718155          Date Filed: 07/29/2022       Page: 2

                                        I. Background

        Monster believes the Iowa Tribe breached a contract with it that concerned

 development of software for online gaming operations. Monster therefore filed a

 petition for arbitration with the American Arbitration Association (AAA).

        The Iowa Tribe contends the dispute must be adjudicated by its tribal court. It

 therefore sought and obtained from the tribal district court a preliminary injunction

 preventing Monster from pursuing AAA arbitration. Monster filed a notice of

 interlocutory appeal seeking to appeal the preliminary injunction to the Supreme Court of

 the Iowa Tribe of Oklahoma.

        Before the Iowa Tribe Supreme Court ruled on the appeal, Monster filed a

 complaint for declaratory and injunctive relief against the tribal district judge, in his

 official capacity, in the Western District of Oklahoma. Monster sought declarations that

 the tribal court lacked jurisdiction to entertain the claims brought by the Iowa Tribe

 against it, and that the question of whether Monster could force the Iowa Tribe to

 arbitrate must be decided by the AAA, and not the tribal court. Monster also sought an

 injunction ordering the tribal judge to refrain from exercising jurisdiction over claims

 against Monster or from continuing to enjoin Monster’s efforts to seek arbitration with

 the AAA.

 (10th Cir. 2014) (“[O]fficial capacity suits are simply ‘another way of pleading an
 action against an entity of which an officer is an agent.’” (quoting Monell v. Dep’t of
 Soc. Servs., 436 U.S. 658, 690 n. 55 (1978)).

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        The district court dismissed the complaint sua sponte. It noted that under “[t]he

 tribal court exhaustion rule,” “‘as a matter of comity, a federal court should not exercise

 jurisdiction over cases arising under its federal question or diversity jurisdiction, if those

 cases are also subject to tribal jurisdiction, until the parties have exhausted their tribal

 remedies.’” Aplt. App. at 68 (quoting United States v. Tsosie, 92 F.3d 1037, 1041

 (10th Cir. 1996)). And it concluded that “[i]f the Tribal Supreme Court upholds the

 lower court’s determination that it has jurisdiction, [Monster] may challenge that ruling

 before this Court.” Id. at 70. “But,” the district court further concluded, “unless and until

 that happens, because the exhaustion of tribal court remedies is required before

 [Monster’s] claims may be considered by a federal court, and because [Monster] has not

 exhausted its tribal court remedies, this case is hereby DISMISSED without prejudice.”

 Id.

        Monster filed a motion for reconsideration, which the district court denied, and

 then Monster filed a notice of appeal.

        While this appeal was pending, on February 18, 2022, the Iowa Tribe Supreme

 Court dismissed Monster’s interlocutory appeal “for failure of the would-be Appellant to

 comply with the provisions of Iowa Tribe of Oklahoma Appellate Procedure.” Aplee.

 App. at 139.

        Two days after the Iowa Tribe filed its response brief in this appeal, on March 16,

 2022, Monster filed a new complaint in the Western District of Oklahoma that sought

 essentially the same relief as the complaint underlying this appeal.

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        Monster later filed its motion to dismiss this appeal, asserting its new district court

 case rendered this appeal of the district court’s dismissal of its first case moot. The Iowa

 Tribe responded by arguing the new case did not render this appeal moot but stating that

 it did not oppose dismissal. The Iowa Tribe also filed a Federal Rule of Appellate

 Procedure 38 motion for attorneys’ fees and double costs as a sanction for Monster’s

 frivolous appeal and tactics in prosecuting the appeal. The Iowa Tribe asks that the

 sanction be imposed jointly and severally on Monster and its attorney.

                          II. The Motion to Dismiss this Appeal

        Federal Rule of Appellate Procedure 42 governs voluntary dismissals and provides

 that “[a]n appeal may be dismissed on the appellant’s motion on terms agreed to by the

 parties or fixed by the court.” Fed. R. App. P. 42(b). “[I]t is within our discretion

 whether to accede to a litigant’s request to terminate his appeal.” United States v.

 DeShazer, 554 F.3d 1281, 1285 n.1 (10th Cir. 2009). Rule 42(b) “motions are generally

 granted, but may be denied in the interest of justice or fairness.” Am. Auto. Mfrs. Ass’n v.

 Comm’r, Mass. Dep’t of Env’t Prot., 31 F.3d 18, 22 (1st Cir. 1994).

        Monster argues its motion to dismiss should be granted because its new district

 court action renders this appeal prudentially moot. See Mot. to Dismiss at 3 (“In our

 view, the appeal has been rendered moot, in that . . . [‘]the anticipated benefits of a

 remedial decree no longer justify the trouble of deciding the case on the merits.’”

 (quoting Winzler v. Toyota Motor Sales U.S.A., Inc., 681 F.3d 1208, 1210 (10th Cir.

 2012)).

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        The Iowa Tribe responds by stating it “does not oppose dismissal in principle,” but

 does “oppose both Monster’s stated reason for dismissal and Monster’s refusal to even

 attempt to resolve the allocation of attorneys’ fees and costs.” Resp. to Mot. to Dismiss

 at 11; see also id. at 10 (“That is not to say the appeal should not be dismissed. It should.

 However, it should be dismissed on the proper grounds . . . .”). And the Iowa Tribe asked

 the court to “grant an award of attorneys’ fees and double costs.” Id. at 11–12.

        Because both parties want the appeal dismissed, and neither party asserts dismissal

 will undermine fundamental fairness or the interests of justice, we grant the motion to

 dismiss.

                       III. The Rule 38 Motion for Fees and Costs

        Federal Rule of Appellate Procedure 38 provides that “[i]f a court of appeals

 determines that an appeal is frivolous, it may, after a separately filed motion or notice

 from the court and reasonable opportunity to respond, award just damages and single or

 double costs to the appellee.” Rule 38’s phrase “just damages” includes “attorney’s

 fees.” Braley v. Campbell, 832 F.2d 1504, 1510 (10th Cir. 1987) (en banc). Sanctions

 are imposed under Rule 38 “to penalize an appellant who takes a frivolous appeal and to

 compensate the injured appellee for the delay and added expense of defending the district

 court’s judgment.” Burlington N. R.R. v. Woods, 480 U.S. 1, 7 (1987).

        “An appeal is frivolous when the result is obvious, or the appellant’s arguments of

 error are wholly without merit.” Braley, 832 F.2d at 1510 (internal quotation marks

 omitted). As for the scope of a sanctions award, an appeal may be frivolous as filed or as

 argued. See id. at 1513–14; see also Finch v. Hughes Aircraft Co., 926 F.2d 1574, 1578–

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 79 (Fed. Cir. 1991). An appeal is frivolous as filed when “the judgment by the tribunal

 below was so plainly correct and the legal authority contrary to appellant’s position so

 clear that there really is no appealable issue.” Finch, 926 F.2d at 1579. In a frivolous-as-

 argued appeal, “genuinely appealable issues may exist,” but “the appellant’s contentions

 in prosecuting the appeal are frivolous.” Id.

        In the Rule 38 motion, the Iowa Tribe argues the appeal is (1) frivolous as filed

 because the court lacks appellate jurisdiction to entertain it, and (2) frivolous as argued

 because Monster’s arguments for reversal fail to grapple with binding precedent that

 supports the district court’s order. The Iowa Tribe also complains about Monster’s

 conduct on appeal in resisting the Iowa Tribe’s motion for the court to take judicial notice

 of filings in the tribal court proceedings and in Monster’s tactic of waiting until after the

 Iowa Tribe filed its response brief to file its second district court action and seek

 dismissal of this appeal.

        A. Appellate Jurisdiction

        The Iowa Tribe argues this court clearly lacked jurisdiction under 28 U.S.C.

 § 1291 to entertain an appeal from the district court’s order because the order dismissed

 Monster’s action without prejudice, and therefore was not a final order. But our

 precedent demands further analysis:

        [T]hat a dismissal was without prejudice does not necessarily make it non-
        final under section 1291. Rather, in this circuit, whether an order of
        dismissal is appealable generally depends on whether the district court
        dismissed the complaint or the action. A dismissal of the complaint is
        ordinarily a non-final, nonappealable order (since amendment would
        generally be available), while a dismissal of the entire action is ordinarily
        final.

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        Despite our use of this complaint/action terminology, we have long
        recognized that the requirement of finality imposed by section 1291 is to be
        given a practical rather than a technical construction. In evaluating finality,
        therefore, we look to the substance and objective intent of the district
        court’s order, not just its terminology.

 Moya v. Schollenbarger, 465 F.3d 444, 448–49 (10th Cir. 2006) (internal quotation

 marks and citations omitted).

        The district court’s order states that the “case” is dismissed, Aplt. App. at 70, and

 the court entered a separate judgment stating “the matter” is dismissed, id. at 71. Also,

 the court’s denial of Monster’s motion for reconsideration states the “action has been

 dismissed.” Id. at 82. Based on these statements, there is a non-frivolous argument this

 court has appellate jurisdiction under § 1291. Not only that, but the Iowa Tribe fails to

 address Monster’s contention that the court has jurisdiction under 28 U.S.C. § 1292(a),

 which provides jurisdiction over interlocutory appeals from orders refusing injunctions,

 among other things. We therefore do not agree with the Iowa Tribe that the appeal was

 frivolous as filed due to the absence of appellate jurisdiction.

        B. Merits of the Appeal

        The Iowa Tribe also argues the court should impose Rule 38 sanctions because

 Monster’s appeal is frivolous as argued. On this point, we agree.

        This court has imposed sanctions where an appellant’s “position [was] not

 warranted by existing law or a good faith argument for the extension, modification or

 reversal of existing law,” and where the appellant made “no effort” “to distinguish

 existing case law, to bring about a reasoned extension or change in the law, or to point

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 out actual errors.” Casper v. Comm’r, 805 F.2d 902, 905 (10th Cir. 1986), overruled on

 other grounds by Wheeler v. Comm’r, 521 F.3d 1289, 1291 n.1 (10th Cir. 2008).

        Monster’s argument section of its opening brief spans under two pages. See Aplt.

 Opening Br. at 12–13. It does not address the basis for the district court’s

 order—namely, that principles of comity and the tribal court exhaustion doctrine require

 federal courts to refrain from exercising jurisdiction until the tribal court has had a full

 opportunity to consider its jurisdiction. To the extent Monster challenges the district

 court’s dismissal order at all, it contends only that the Tenth Circuit should establish

 safeguards for tribal exhaustion dismissals that include requiring the defendant to respond

 and giving the plaintiff a chance to reply to this response. In making this argument,

 Monster cites a Sixth Circuit case, Tingler v. Marshall, 716 F.2d 1109 (6th Cir. 1983),

 overruled by statute as stated in Coleman v. Tollefson, 733 F.3d 175, 177 (6th Cir. 2013),

 that established similar safeguards to be employed before dismissing a case sua sponte on

 the merits. But Monster does not address United States v. Tsosie, 92 F.3d 1037, 1039,

 1041 (10th Cir. 1996), in which this court held district courts have “discretion to raise

 comity issues sua sponte” and affirmed the district court’s dismissal of the action in that

 case under the tribal court exhaustion doctrine without imposing any procedural

 conditions precedent on the district court’s dismissal. Nor does Monster explain why the

 procedural safeguards from Tingler should be applied to a non-merits dismissal, why the

 opportunity for a litigant to file a motion for reconsideration, like Monster did, does not

 suffice to protect plaintiffs from erroneous dismissals, or why the district court’s failure

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 to impose Monster’s suggested procedural safeguards harmed it given that the district

 court considered Monster’s arguments in connection with the motion for reconsideration.

        We conclude Monster’s appeal was frivolous as argued and order Monster’s

 attorney to pay the Iowa Tribe’s reasonable attorneys’ fees incurred in connection with

 this appeal. We deny the Iowa Tribe’s request for costs as a sanction under Federal Rule

 of Appellate Procedure 38. 2

                                      IV. Conclusion

        We grant Monster’s motion and dismiss this appeal. We grant the Iowa Tribe’s

 motion for sanctions as set forth herein. We remand to the district court for the limited

 purpose of determining the amount of the monetary award. The pending motion for

 judicial notice is denied as moot.

                                               Entered for the Court

                                               Timothy M. Tymkovich
                                               Chief Judge

        2
         This ruling has no bearing on any party’s ability to seek costs under Federal
 Rule of Appellate Procedure 39.
                                              9