McCook Metals LLC v. Alcoa, Incorporated ( 2001 )

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
MCCOOK METALS LLC, 
Plaintiff-Appellant,
v.
ALCOA, INCORPORATED,
Defendant-Appellee,  No. 00-1333
and
REYNOLDS METALS COMPANY,
Party in Interest-Appellee.

Appeal from the United States District Court
for the Eastern District of Virginia, at Richmond.
James R. Spencer, District Judge.
(MISC-99-7-3)
Argued: April 3, 2001
Decided: May 10, 2001
Before NIEMEYER, MICHAEL, and MOTZ, Circuit Judges.
Motion to transfer granted by published opinion. Judge Niemeyer
wrote the opinion, in which Judge Michael and Judge Motz joined.
COUNSEL
ARGUED: Jodi Rosen Wine, JENKENS & GILCHRIST, P.C., Chi-
cago, Illinois, for Appellant. Warren Eugene Zirkle, MCGUIRE-
WOODS, L.L.P., McLean, Virginia, for Appellees. ON BRIEF:
2 MCCOOK METALS v. ALCOA, INC.
Edward F. McCormack, JENKENS & GILCHRIST, P.C., Chicago,
Illinois; William R. Mauck, Jr., WILLIAMS, MULLEN, CLARK &
DOBBINS, Richmond, Virginia, for Appellant. Brian C. Riopelle,
Kristen M. Calleja, MCGUIREWOODS, L.L.P., Richmond, Virginia,
for Appellees.
OPINION
NIEMEYER, Circuit Judge:
This appeal is taken from an order in an ancillary discovery pro-
ceeding commenced to enforce a subpoena that issued from the East-
ern District of Virginia in connection with an underlying action filed
in the Northern District of Illinois. Because jurisdiction in the under-
lying action is based in part on 28 U.S.C. § 1338, which confers juris-
diction upon district courts in patent matters, we conclude that any
review of this ancillary discovery ruling must be sought from the
United States Court of Appeals for the Federal Circuit under 28
U.S.C. §§ 1292(c) and 1295(a). Rather than dismissing this appeal,
however, we invoke 28 U.S.C. § 1631 to transfer it to the Federal Cir-
cuit, despite any uncertainty that might exist as to the appealability of
this type of discovery order, based on the fact that the Federal Circuit
will ultimately have jurisdiction to review the merits of the underlying
action.
I
McCook Metals L.L.C. ("McCook") commenced an action against
Alcoa, Inc., a competitor of McCook in the manufacture and sale of
commercial aircraft wing components, in the Northern District of Illi-
nois. In that action, McCook alleged that Alcoa interfered with
McCook’s customer contracts and prospective business advantage in
violation of state law, that Alcoa monopolized the relevant product
market in violation of the Sherman Act, and that two of Alcoa’s pat-
ents for making high strength aluminum alloy — nos. 4,828,631 and
4,954,188 — were neither valid nor enforceable. McCook invoked the
district court’s subject matter jurisdiction based on the patent and
antitrust claims.
MCCOOK METALS v. ALCOA, INC. 3
In connection with this underlying litigation, McCook served a
third-party subpoena, issuing from the Eastern District of Virginia, on
Reynolds Metals Company to appear, testify, and produce documents
at a deposition scheduled in Richmond, Virginia. When Reynolds
Metals refused to answer particular questions and produce particular
documents, giving as its reasons the work product doctrine and
attorney-client privilege, McCook filed a motion in the Eastern Dis-
trict of Virginia to enforce its subpoena. The district court upheld
Reynolds Metals’ position and denied McCook’s motion, and
McCook took this appeal from the district court’s order. Shortly
before oral argument before us, Reynolds Metals filed a motion to
transfer this case to the Court of Appeals for the Federal Circuit on
jurisdictional grounds.
II
In its motion to transfer, which was made under 28 U.S.C. § 1631,
Reynolds Metals asserted that, because the validity of two Alcoa pat-
ents is at issue in the underlying action and subject matter jurisdiction
in that action is premised in part on 28 U.S.C. § 1338, the Court of
Appeals for the Federal Circuit has exclusive jurisdiction over appeals
of decisions in ancillary discovery proceedings. Reynolds Metals rep-
resented in its motion that "McCook agrees with this analysis," a posi-
tion McCook confirmed at oral argument. McCook nonetheless
requested that we proceed to decide the discovery issues on the merits
because they have been briefed and argued before us. We agree with
Reynolds Metals, however, that this court "must be sure of its own
jurisdiction before getting to the merits." Ortiz v. Fibreboard Corp.,
527 U.S. 815, 831 (1999) (citing Steel Co. v. Citizens for a Better
Env’t, 523 U.S. 83, 88-89 (1998)).
We begin our analysis by noting that, while most appeals must be
filed in the court of appeals for the circuit in which the district court
is located, see 28 U.S.C. § 1294, only the Federal Circuit can hear an
appeal when the district court’s jurisdiction was based "in whole or
in part" on 28 U.S.C. § 1338, which confers original jurisdiction over
patent-related claims on district courts, id. § 1295(a)(1). Similarly,
interlocutory orders in cases in which jurisdiction is based on § 1338
are reviewed exclusively by the Federal Circuit. See id. § 1292(c).
Congress created this dual-appellate structure in 1981 to promote "na-
4 MCCOOK METALS v. ALCOA, INC.
tionwide uniformity in patent law." Bonito Boats, Inc. v. Thunder
Craft Boats, Inc., 489 U.S. 141, 162 (1989) (quoting H.R. Rep. No.
97-312, at 20 (1981) (internal quotation marks omitted)). As a conse-
quence, the regional courts of appeals have no jurisdiction over
appeals in cases in which the district court’s jurisdiction was based in
whole or in part on 28 U.S.C. § 1338.
Because the parties in this case agree that the jurisdiction of the
District Court for the Northern District of Illinois was predicated in
part upon 28 U.S.C. § 1338, as McCook’s complaint sought a declara-
tory judgment of its rights vis-a-vis Alcoa under the federal patent
law, 35 U.S.C. § 1 et seq., any appeal from the final judgment in the
Northern District of Illinois must go to the Federal Circuit. Because
subject matter jurisdiction in the underlying action is based in part on
28 U.S.C. § 1338, so too must the jurisdiction supporting the ancillary
proceeding commenced in the Eastern District of Virginia be based
in part on § 1338. Although it is true that the ancillary court’s first-
layer authority derives from Federal Rules of Civil Procedure 37(a)(1)
and 45, which assign to it the responsibility of issuing and enforcing
subpoenas in its district, Rules 37 and 45 do not confer subject matter
jurisdiction upon the courts. Rather, an ancillary court’s power to
issue and enforce subpoenas is entirely dependent upon the jurisdic-
tion of the court in which the underlying action is pending. See United
States Catholic Conference v. Abortion Rights Mobilization, Inc., 487
U.S. 72, 76 (1988) ("[T]he subpoena power of a court cannot be more
extensive than its jurisdiction. . . . [I]f a district court does not have
subject-matter jurisdiction over the underlying action . . . then the pro-
cess is void"); United States v. Morton Salt Co., 338 U.S. 632, 642
(1950) ("The judicial subpoena power . . . is subject to those limita-
tions inherent in the body that issues them"); see also Houston Bus.
Journal, Inc. v. Office of the Comptroller of the Currency, 86 F.3d
1208, 1213 (D.C. Cir. 1996) ("[T]he district court is . . . without
power to issue a subpoena when the underlying action is not even
asserted to be within federal-court jurisdiction"). Thus, because the
ancillary discovery proceeding is, by its very terms, an extension of
the underlying proceeding and the subject matter jurisdiction of the
ancillary proceeding is derived from the jurisdiction of the underlying
case, any appeal from an order of the ancillary court in a patent case
must proceed to the Federal Circuit by reason of 28 U.S.C. §§ 1292(c)
and 1295(a). We therefore conclude that we have no jurisdiction to
MCCOOK METALS v. ALCOA, INC. 5
review the order entered by the Eastern District of Virginia. See Dorf
& Stanton Communications, Inc. v. Molson Breweries, 56 F.3d 13,
14-15 (2d Cir. 1995); see also Haworth, Inc. v. Herman Miller, Inc.,
998 F.2d 975, 977 (Fed. Cir. 1993) (noting that the Federal Circuit
applies the law of the regional circuit from which a discovery order
is appealed).
III
Our determination that we do not have appellate jurisdiction, how-
ever, does not lead inexorably to the conclusion that we must dismiss
this appeal. Section 1631 of Title 28 authorizes us to transfer it to the
Federal Circuit if (1) to do so would be "in the interest of justice" and
(2) the appeal "could have been brought" in the Federal Circuit when
it was initially filed in our court.
The first prong of this test is readily met. McCook’s erroneous fil-
ing of an appeal in the wrong circuit is "just the type of good faith
mistake that Congress intended 28 U.S.C. § 1631 to remedy." Kopp
v. Dir., Office of Worker’s Comp. Programs, 877 F.2d 307, 309 (4th
Cir. 1989). Moreover, were we to dismiss this appeal now, McCook
might be denied the opportunity to urge review of this ancillary dis-
covery order because the 30-day time limit for taking an appeal may
have run. See 28 U.S.C. § 2107; Fed. R. App. P. 4(a). For these rea-
sons, a transfer to the Federal Circuit would be "in the interest of jus-
tice."
It is less obvious, however, that McCook’s appeal "could have been
brought" in the Federal Circuit at the time when it was filed or noticed
in our court. 28 U.S.C. § 1631. Appellate review is as a general matter
limited by 28 U.S.C. § 1291 to final orders — those that "end[ ] the
litigation on the merits and leave nothing for the court to do but exe-
cute the judgment." Catlin v. United States, 324 U.S. 229, 233 (1945).
A discovery order, in contrast, is inherently interlocutory. Given the
sheer number of discovery orders that are issued in any given case,
appellate courts are justifiably reluctant to review them. "Allowing
immediate appeal of the orders resolving discovery disputes would
only disrupt and delay district court proceedings and clog the courts
of appeals with matters more properly managed by trial courts famil-
6 MCCOOK METALS v. ALCOA, INC.
iar with the parties and their controversy." MDK, Inc. v. Mike’s Train
House, Inc., 27 F.3d 116, 119 (4th Cir. 1994).
Nevertheless, federal courts have long recognized that some collat-
eral orders warrant "review even where they do not conclude the liti-
gation in question." MDK, Inc., 27 F.3d at 120 (citing Cohen v.
Beneficial Indus. Loan Corp., 337 U.S. 541, 546 (1949)). While we
have not yet been presented with the question, courts in several other
circuits have held that this "collateral order" doctrine renders certain
ancillary discovery orders appealable if the district court supervising
the ancillary proceeding is located in a different circuit from the court
supervising the underlying proceeding. In holding that these orders
are sufficiently final to merit review, these courts have noted that such
orders (1) conclusively determine the issues before the district court,
(2) resolve issues independent of the issues in the underlying litiga-
tion, and (3) are unreviewable by the court of appeals having jurisdic-
tion to review the judgment of the district court in the underlying
litigation. See CF & I Steel Corp. v. Mitsui & Co., 713 F.2d 494, 496
(9th Cir. 1983); Nat’l Life Ins. Co. v. Hartford Accident & Indem.
Co., 615 F.2d 595, 597 (3d Cir. 1980); Republic Gear Co. v. Borg-
Warner Corp., 381 F.2d 551, 554 (2d Cir. 1967).
Because unreviewability by the court of appeals having appellate
jurisdiction over the final judgment in the underlying case is critical
to the determination that an ancillary discovery order is "final," most
circuit courts have held that an ancillary discovery order is not "final"
when it is entered by a district court within the same circuit as the
court in which the underlying litigation is pending. See Periodical
Publishers Serv. Bureau, Inc. v. Keys, 981 F.2d 215, 217-18 (5th Cir.
1993); Hooker v. Cont’l Life Ins. Co., 965 F.2d 903, 905 (10th Cir.
1992); Barrick Group, Inc. v. Mosse, 849 F.2d 70, 73 (2d Cir. 1988);
In re Subpoena Served on the Cal. Pub. Utils. Comm’n, 813 F.2d
1473, 1476-80 (9th Cir. 1987). Because the same court of appeals
can, in such a case, review both the ancillary discovery disputes and
the final judgment on the merits, the discovery order does not become
reviewable in these circuits until the court of appeals reviews the final
judgment. In such cases, the several district court proceedings in the
aggregate are considered analogous to the ordinary case in which the
same district court conducts discovery and considers the merits. In
MCCOOK METALS v. ALCOA, INC. 7
either situation, discovery orders are not "final" because they may be
reviewed simultaneously with the final judgment.
The case before us presents a peculiar twist because for patent mat-
ters, Congress created one national court of appeals to review all the
district courts — the Court of Appeals for the Federal Circuit — and
thus one district court’s ancillary discovery ruling in a patent case is
appealed to the same circuit as is another district court’s ruling on the
merits in the same case, even when the district courts are located in
different regional circuits. Because in patent cases the Federal Circuit
reviews both the final judgment on the merits and rulings on discov-
ery, under the majority rule — that discovery orders reviewable in the
same court of appeals that reviews the final judgment are not "final"
— we could not transfer the case to the Federal Circuit because the
appeal of the discovery order could not have been brought there at
this time. See 28 U.S.C. § 1631.
But the Federal Circuit has not always followed the majority rule
in this context and has entertained on more than one occasion inter-
locutory appeals from ancillary orders denying discovery in patent
cases. See Micro Motion, Inc. v. Kane Steel Co., 894 F.2d 1318, 1320
(Fed. Cir. 1990); Heat & Control, Inc. v. Hester Indus., Inc., 785 F.2d
1017, 1020-22 (Fed. Cir. 1986). Accordingly, under these Federal
Circuit precedents McCook might have been able to obtain immediate
review of the district court’s denial of its motion to compel had it
filed its appeal with the Federal Circuit. Even though the wisdom of
allowing such interlocutory appeals may be questionable, we will not
determine the scope of the Federal Circuit’s jurisdiction for it. Rather,
as a matter of comity, we grant the motion to transfer this proceeding
to the Federal Circuit to permit that court to make its own determina-
tion on the issue.
Accordingly, for the reasons given, Reynolds Metals’ motion to
transfer this case to the Federal Circuit is granted.
IT IS SO ORDERED