Sixth Circuit Decision on Appellate Jurisdiction and Manufactured Finality (Guest Post by Andrew Pollis)

Andrew Pollis presents the following guest post on a very interesting Sixth Circuit decision:

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Last week, in Rowland v. Southern Health Partners, Inc., the Sixth Circuit issued a split decision on the vexing question of manufactured finality in civil actions—that is, a party’s dismissal of unadjudicated claims as a means of securing appellate jurisdiction over the district court’s resolution of an adjudicated claim. The majority rejected the maneuver, explaining its rationale in the opening paragraph of the decision:

Can a litigant circumvent the requirements of Rule 54(b) by the expedient of voluntarily dismissing her surviving claims in order to seek immediate appellate review of an adverse judgment on her resolved claims, with the intention of reinstating the dismissed claims should she obtain a favorable outcome on appeal? Eight years ago, we answered this question no, because such a dismissal does not create a final order under 28 U.S.C. § 1291. Page Plus of Atlanta, Inc. v. Owl Wireless, LLC, 733 F.3d 658, 658 (6th Cir. 2013). The answer is still no.

The majority reiterated the court’s previous holding in Page Plus that there are only two circumstances that permit the appeal to go forward in the face of manufactured finality: (1) when “a voluntary dismissal comes at a cost,” such as when “a party assumes the risk that the statute of limitations, any applicable preclusion rules or any other defenses might bar recovery on the claim”; and (2) when “a claim voluntarily dismissed without prejudice must be re-filed in a separate action,” which removes the “risk that the same case will produce multiple appeals raising different issues.” The majority also noted that its holding was consistent with the holdings of other appellate courts to address the issue, save the Second Circuit.

Judge Karen Moore, in dissent, took issue primarily with the majority’s characterization that the plaintiff had in fact assumed no risks in agreeing to dismiss her unresolved claims:

Unlike in Page Plus, here nothing in the district court’s order states or even hints that the parties agreed that Defendants would not assert any time-based affirmative defenses against the voluntarily dismissed state-law claims. In fact, Defendants have explicitly stated that they believe that any re-filing of the voluntarily dismissed claims would be time-barred.

But perhaps the most interesting feature of Judge Moore’s dissent is her discussion of the inconsistent rulings courts have issued in these types of cases. She noted that litigants’ efforts to manufacture finality have “troubled courts of appeals for over forty years” and that “[n]early every circuit has weighed in on this question with inter- and intra-circuit splits causing confusion and frustration for both courts and litigants.” And she lamented the “disturbing lack of predictability in circuits that allow or do not allow litigants to employ Rule 41(a) dismissals without prejudice to gain appellate review; intra-circuit splits and unclear exceptions exist both in circuits with a bright-line rule disfavoring such appeals and in circuits that routinely allow them.” She admonished litigants that the “disagreement and confusion sown by the circuits” require parties to be “very wary of using Rule 41(a) as a mechanism for obtaining immediate appellate review. . . . Nothing is certain, even in a circuit that purports to allow parties to utilize Rule 41(a)(2) voluntary dismissals to secure appellate review.” Judge Moore also suggested that the Supreme Court “may eventually “intervene and decisively bar litigants from using Rule 41(a) voluntary dismissals without prejudice as an option to pursue appellate review,” given its holding in Microsoft Corp. v. Baker, 137 S. Ct. 1702 (2017), that “evinces a strong respect for rulemaking as the proper avenue for determining when a decision is final for purposes of [28 U.S.C. § 1291] or when a decision is otherwise appealable.”