Dresser v. The Ohio Hempery Inc , 122 F. App'x 749 ( 2004 )

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT December 22, 2004
Charles R. Fulbruge III
Clerk
No. 04-30294
CHRISTOPHER J. DRESSER,
Plaintiff-Appellant,
versus
THE OHIO HEMPERY INC.; ET AL.,
Defendants,
OAKMONT INVESTMENT COMPANY INC.; AMERICAN EMPLOYERS’ INSURANCE
COMPANY; COMMERCIAL UNION INSURANCE COMPANY;
Defendants-Appellees.
Appeal from the United States District Court
for the Eastern District of Louisiana
(No. 98-CV-2425-R)
Before REAVLEY, DAVIS, and WIENER, Circuit Judges.
PER CURIAM:*
Plaintiff-Appellant Christopher Dresser appeals the district
court’s grant of a stay pending the outcome of a Coast Guard
administrative proceeding. As we are without jurisdiction to
hear the appeal, we dismiss.
I. FACTS AND PROCEEDINGS
*
Pursuant to 5TH CIR. R. 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
Dresser is a Coast Guard-licensed vessel engineer. He alleged
that, prior to taking a Coast Guard drug test, he ingested “Hemp
Liquid Gold,” a product manufactured and distributed by Defendant-
Appellee Oakmont Investment Company Inc. (“Oakmont”). Dresser
failed the drug test, testing positive for marijuana/THC, as a
result of which the Coast Guard sought to have Dresser’s license
revoked. A hearing was commenced by a Coast Guard Administrative
Law Judge (“ALJ”) in April 1998 and completed in June of that year.
Two months later, Dresser sued Oakmont in federal district court
seeking damages for emotional distress as well as significant loss
of earnings, earning capacity, pension benefits, medical insurance
and loss of other job-related benefits.
Early the following year, the ALJ ordered Dresser’s license
revoked, after which Oakmont sought a stay of the proceedings in
district court pending the outcome of Dresser’s administrative
appeal. Oakmont’s stay was granted and some two and one half years
later the ALJ’s decision was affirmed by the Coast Guard
Commandant. Dresser appealed the Commandant’s decision to the
National Transportation Safety Board (“NTSB”) which, after the
passage of yet another year, reversed and remanded for new hearings
because the original ALJ had a conflict of interest (the ALJ’s son
was representing Oakmont in the instant litigation).
The month after the NTSB reversed and remanded, Dresser filed
a motion to reopen this case, which motion the district court
granted. Oakmont again sought to stay the district court
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proceeding pending a final result in the Coast Guard administrative
proceedings. After oral argument and consideration of supplemental
memoranda, the district court granted Oakmont’s stay. Dresser
seeks appellate review of the stay or, alternatively, a writ of
mandamus.
II. ANALYSIS
Before addressing the merits of the stay order, we must
determine whether we have appellate jurisdiction. Generally, 28
U.S.C. § 1291 provides appellate jurisdiction only over final
judgments of the district courts.1 Stays do not typically qualify
as final judgments for purposes of § 1291.2 Dresser relies on two
exceptions to § 1291’s finality requirement to sustain our
jurisdiction over this appeal: (1) the so-called death knell or
“effectively out of court” exception; and (2) the collateral order
doctrine. In the alternative, Dresser asks us to treat his appeal
as a petition for mandamus. As a result of the narrow construction
given to both the death knell exception and the collateral order
doctrine, and the restriction of mandamus to “extraordinary
1
“The courts of appeals . . . shall have jurisdiction of
appeals from all final decisions of the district courts of the
United States . . . except where a direct review may be had in
the Supreme Court.” 28 U.S.C. § 1291.
2
“[A] stay is not ordinarily a final decision for purposes
of § 1291.” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp.,
460 U.S. 1, 10 n.11 (1983); see also Kershaw v. Shalala, 9 F.3d
11, 14 (5th Cir. 1993) (same).
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situations,” we conclude that we do not have jurisdiction to hear
Dresser’s appeal.
A. THE DEATH KNELL EXCEPTION
The death knell or “effectively out of court” exception can be
traced to the Supreme Court’s decision in Idlewild Bon Voyage
Liquor Corp. v. Epstein.3 The plaintiff in Idlewild filed suit in
federal court challenging the constitutionality of a state statute.
The district court declined to convene a three judge panel and
stayed the federal court suit under the Pullman abstention
doctrine.4 The Second Circuit disagreed with the district court,
but dismissed for lack of appellate jurisdiction. After the
plaintiff was rejected by the district court for a second time, the
Supreme Court granted certiorari and held that the district court’s
action was final and therefore reviewable by the appellate court,
pointing out that the appellant “was effectively out of court.”5
In Moses H. Cone Memorial Hospital v. Mercury Construction
Corp., the Court narrowed the application of Idlewild to “cases
where (under Colorado River, abstention, or a closely similar
doctrine) the object of the stay is to require all or an essential
3
370 U.S. 713 (1962).
4
Idlewild Bon Voyage Liquor Corp. v. Rohan, 188 F.Supp. 434(S.D.N.Y. 1960).
5
Id. at 715 n.2.
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part of the federal suit to be litigated in a state forum.”6
Dresser relies primarily on our decision in Granite State Insurance
Co. v. Tandy Corp. in support of his insistence that the death
knell exception is applicable to his case.7 In Granite State, we
allowed the appeal of a stay order in favor of a state court
proceeding, holding that “[w]here a stay order effectively
dismisses the federal suit, as in this case, it is treated as a
final order under § 1291.”8 Following the teaching of Moses H.
Cone, we have expressly limited application of the death knell
exception to cases in which the stay required all or essentially
all of the suit to be litigated in state court.9 Dresser’s
reliance on Granite State is misplaced because the stay in the
present case does not require any part of a suit to be decided in
a state forum; it requires a decision by a federal agency.
6
460 U.S. at 10 n.11; see also Quackenbush v. Allstate Ins.
Co., 517 U.S. 706, 713 (1996).
7
986 F.2d 94 (5th Cir. 1992).
8
Id. at 95.
9
See Kershaw, 9 F.3d at 14 (acknowledging holding in Moses
that limits use of exception to situations when the stay requires
all or essentially all of the suit to be litigated in state
court); Kmart Corp. v. Aronds, 123 F.3d 297, 300 (5th Cir. 1997)
(“[T]his Court has stated that while it liberally construed the
death knell exception in the past, it could no longer do so
because the exception was limited to cases where the stay
requires all or essentially all of the suit to be litigated in
state court.”); United States v. L.J. Garner, 749 F.2d 281, 288
(5th Cir. 1985) (same).
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Dresser advances two arguments for why his case should still
fall within the death knell exception. First, he notes that the
suit, although not relegated to state court, has been removed from
a federal forum. In Kershaw v. Shalala, we rejected this line of
reasoning.10 The plaintiff in Kershaw had been denied disability
benefits under the Social Security Act by the Secretary of Health
and Human Services. The district court ruled that the record did
not contain substantial evidence to sustain the Secretary’s
decision and entered an order reversing and remanding. The
plaintiff filed a motion to recover attorney’s fees and expenses as
provided by statute. The district court stayed the application
pending disposition by the administrative agency on remand. The
plaintiff appealed the district court’s stay order but we dismissed
for lack of appellate jurisdiction, refusing to apply the death
knell exception:
The eventual decision of the Secretary will be fully
reviewable by the district court, and that court’s
decision will be fully reviewable by this Court. Thus,
unlike certain abstention stay orders, the present order
does not deprive the plaintiff of an effective appeal in
a federal forum.11
As was the situation in Kershaw, Dresser will not be deprived
of an “effective appeal in a federal forum.” The decision in the
Coast Guard administrative proceeding will ultimately be reviewable
by federal district and appellate courts. Dresser tries to
10
9 F.3d 11 (5th Cir. 1993).
11
Id. at 14.
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distinguish the cases by highlighting the fact that the district
court that issued the stay here will not be the same one that
conducts the review, as it was in Kershaw. This is a
quintessential distinction without a difference. The concern
animating the death knell exception is with an effective appeal in
“a” federal forum, not in the same federal forum in which the
plaintiff chose to file his action.12
Second, Dresser argues that the stay is the equivalent of
putting him out of court as a result of the unconscionable delay
that the administrative proceeding and its review will create.
Dresser relies entirely on our decision in Hines v. D’Artois, in
which we allowed review of a district court’s sua sponte decision
to stay a case brought under §§ 1981 & 1983 pending exhaustion of
Title VII administrative proceedings in the EEOC.13 Noting that the
EEOC proceedings would likely take eighteen months, if not longer,
we ruled that the stay order effectively put the plaintiffs out of
court for a protracted and indefinite period.14 Although Hines has
never been overturned, subsequent case law has made its
12
Neither is Dresser deprived of an effective appeal in a
federal forum if a decision in the administrative proceeding will
have no collateral estoppel effect in the instant case. As the
death knell exception fails for other independent reasons, it is
unnecessary to examine the collateral estoppel effect that a
decision by the Coast Guard administrative board would have on
this case.
13
531 F.2d 726 (5th Cir. 1976).
14
See id. at 731-32.
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precedential value questionable. In coming to its conclusion, this
court in Hines relied on the Supreme Court’s decisions in Idlewild
and Gillespie v. United States Steel Corp.,15 two rulings that were
narrowed substantially in the years following Hines.16
In light of our recent decision in Kershaw, and the very
narrow interpretation given to the death knell exception by both
the Supreme Court and this circuit, we hold that the death knell
exception is unavailable as a basis for appellate jurisdiction.
B. COLLATERAL ORDER DOCTRINE
Dresser argues in the alternative that the denial of his
motion for a stay is appealable under the exception to the finality
rule espoused in Cohen v. Beneficial Loan Corp.,17 generally known
as the collateral order doctrine. In this circuit, “an order may
be appealed under the Cohen exception if the appellant demonstrates
that the order (1) conclusively determines the disputed question,
(2) resolves an important issue completely separate from the merits
of the action, and (3) is effectively unreviewable on appeal from
15
379 U.S. 148 (1964).
16
See Moses H. Cone, 460 U.S. at 10 n.11 (limiting the
reach of Idlewild to instances when a stay forces all or an
essential part of a federal suit to be litigated in a state
forum); Coopers & Lybrand v. Livesay, 437 U.S. 463 (1978)
(narrowing Gillespie to its unique facts). In Kmart, we noted
that Gillespie’s finality exception was no longer recognized in
our circuit. 123 F.3d at 300.
17
337 U.S. 541 (1949).
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a final judgment.”18 We have stated that “the collateral order
doctrine is not to be applied liberally. Rather, the doctrine is
extraordinarily limited in its application.”19 The requirements of
the collateral order doctrine are conjunctive; failure to satisfy
any one of them defeats appellate jurisdiction.20 As the district
court’s stay order does not “conclusively determine the disputed
question,” it does not qualify as a collateral order.21
The Supreme Court, which analyzed the first prong of the test
for the collateral order doctrine in both Moses Cone and Gulfstream
Aerospace Corp. v. Mayacamas Corp., contrasted two types of orders:
those that are “inherently tentative” and those that, although
technically amendable, are “made with the expectation that they
will be the final word on the subject addressed.”22 In Moses Cone,
18
A-Mark Auction Galleries, Inc. v. Am. Numismatic Ass’n,
233 F.3d 895, 898 (5th Cir. 2000)(citing Acoustic Systems, Inc.
v. Wenger Corp., 207 F.3d 287, 290 (5th Cir. 2000) and Coopers &
Lybrand v. Livesay, 437 U.S. 463, 468-69 (1978)).
19
Acoustic Systems, 207 F.3d at 291; see also Kershaw, 9
F.3d at 14 (“Absent a Moses Cone situation, stay orders rarely
satisfy [the doctrine’s] requirements, and therefore, are usually
not reviewable as collateral orders.”).
20
Garner, 749 F.2d at 287.
21
We note, without deciding the issues, that at least one
other circuit, in an unpublished opinion, has held that a stay of
proceedings in favor of federal agency proceedings does not
satisfy the second or third prongs as well. In re American
Freight Systems, Inc., No. 92-3426, 1993 WL 356784, at *2-3 (10th
Cir. Sept. 3, 1993).
22
Moses H. Cone, 460 U.S. at 13; Gulfstream Aerospace Corp.
v. Mayacamas Corp., 485 U.S. 271, 277 (1988).
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the district court had entered an order under Colorado River Water
Conservation District v. United States staying a federal diversity
suit pending the completion of a declaratory judgment action that
had been filed in state court. The Supreme Court concluded that
such an order is not tentative in nature and held that the stay was
appealable under the collateral order doctrine.23 In Gulfstream,
the Court was faced with the question whether the denial of a
Colorado River stay order was appealable. Answering in the
negative, the Court contrasted the nature of the stay order in
Moses Cone with the refusal to grant such a stay and concluded that
a Colorado River stay “‘necessarily contemplates that the federal
court will have nothing further to do in resolving any substantive
part of the case’ because a district court may enter such an order
only if it has full confidence that the parallel state proceeding
will ‘be an adequate vehicle for the complete and prompt resolution
of the issues between the parties.’”24
Regardless of whether the ultimate outcome of the Coast Guard
administrative hearings will have some estoppel effect on Dresser’s
claims, it cannot be said that a “federal court will have nothing
further to do in resolving any substantive part of the case.” Any
decision by the ALJ will ultimately be reviewable in a federal
district court and presumably in a federal appellate court as well.
23
Moses H. Cone, 460 U.S. at 10.
24
Gulfstream, 485 U.S. at 277 (quoting Moses H. Cone, 460
U.S. at 28).
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If the administrative proceedings are stalled or terminated, the
district court may choose to lift the stay; and it is virtually
certain that the instant case will be resumed at least to some
extent once the administrative proceeding is completed. As the
district court’s stay order is inapposite to the complete
abdication of federal jurisdiction that was present in Moses Cone,
the stay in favor of the federal administrative proceedings here
does not fall into that narrow class of cases in which the
collateral order doctrine applies.25 We hold that the collateral
order doctrine is not available to confer appellate jurisdiction in
this instance.
C. MANDAMUS
Finally, as we have failed to find the stay order otherwise
appealable, we address briefly Dresser’s alternative request that
we issue a writ of mandamus directing the district court to vacate
the stay. “‘Mandamus is an extraordinary remedy reserved for
extraordinary cases,’ one granted ‘not as a matter of right, but in
the exercise of a sound judicial discretion.’”26 The Supreme Court
has ruled emphatically that mandamus must not be used as a
substitute for appeal.27 Mandamus is appropriate to correct the
25
Accord Cofab, Inc. v. Philadelphia Joint Bd., Amalgamated
Clothing & Textile Workers’ Union, 141 F.3d 105 (3d Cir. 1998).
26
In re Occidental Petroleum Corp., 217 F.3d 293, 295 (5th
Cir. 2000) (citing Southern Pac. Transp. Co. v. San Antonio, 748
F.2d 266, 270 (5th Cir. 1984)).
27
Schlagenhauf v. Holder, 379 U.S. 104, 110 (1964).
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grant of a stay only when there is a clear abuse of discretion.28
Dresser “must show not only that the district court erred, but that
it clearly and indisputably erred.29
The short paragraph in Dresser’s brief requesting mandamus
fails to carry this heavy burden. The district court made its
decision after allowing full briefing and oral argument from both
parties before concluding that a stay was proper. The court
reasoned that (1) it would be wasteful for two separate tribunals
to proceed on the same issue of liability simultaneously; (2)
collateral estoppel could operate to bar Dresser’s claim if he
should fail at the administrative hearing to rebut the presumption
of marijuana use through proof by a preponderance of the evidence
that Hemp Liquid Gold was the cause of his failing the drug test;
and (3) Dresser’s theory of damages is largely predicated on the
final outcome of the Coast Guard administrative proceedings.
Without addressing whether the stay was providently granted, we
hold that Dresser has failed to show clearly and indisputably that
the district court’s order falls under those “exceptional
circumstances amounting to a judicial usurpation of power.”30
APPEAL DISMISSED.
28
See Southern Pac. Transp. Co., 748 F.2d at 270.
29
In re Occidental Petroleum Corp., 217 F.3d at 295(internal citations omitted).
30
Gulfstream, 485 U.S. at 289 (citations omitted).
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