Christopher Jones v. E. McDaniel , 717 F.3d 1062 ( 2013 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
CHRISTOPHER A. JONES, No. 10-16658
Plaintiff-Appellant,
D.C. No.
v. 3:05-cv-00278-
RAM
E. K. MCDANIEL; MARK DRAIN ;
JACKIE CRAWFORD ,
Defendants-Appellees. OPINION
Appeal from the United States District Court
for the District of Nevada
Robert A. McQuaid, Magistrate Judge, Presiding
Argued and Submitted
April 12, 2013—Pasadena, California
Filed June 10, 2013
Before: Marsha S. Berzon and Richard C. Tallman, Circuit
Judges, and Lee. H. Rosenthal, District Judge.*
Opinion by Judge Berzon
*
The Honorable Lee H. Rosenthal, District Judge for the U.S. District
Court for the Southern District of Texas, sitting by designation.
2 JONES V . MCDANIEL
SUMMARY**
Prisoner Civil Rights
The panel dismissed a prisoner’s civil rights appeal after
finding that it was rendered moot by the parties’ post-trial
settlement agreement.
Following a jury trial on damages on plaintiff’s due
process claim, the parties entered into a settlement agreement,
according to which plaintiff received $11,000 plus costs and
attorneys’ fees, as well as expungement of the record of a
disciplinary violation, in full satisfaction of the judgment.
Plaintiff then filed this appeal arguing that the district court’s
post-trial “Judgment in a Civil Case” did not encompass the
district court’s earlier summary judgment order pertaining to
plaintiff’s First Amendment claims. The panel held that the
district court’s summary judgment on the First Amendment
claim merged with the district court’s final judgment and was
therefore subject to the parties’ Accord and Satisfaction
which resolved all facets of their dispute.
COUNSEL
Bradley Walters (argued) and Jorge Nicolas Anwandter
(argued), Law Students, under the supervision of Erwin
Chemerinsky, Peter Afrasiabi, and Kathryn Davis, University
of California, Irvine, School of Law, Appellate Litigation
Clinic, Irvine, California, for Plaintiff-Appellant.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
JONES V . MCDANIEL 3
Clark G. Leslie (argued), Senior Deputy Attorney General,
and Catherine Cortez Masto, Attorney General, Carson City,
Nevada, for Defendants-Appellees.
OPINION
BERZON, Circuit Judge:
While incarcerated in Ely State Prison in Ely, Nevada,
Christopher Jones wrote a letter to his fellow inmates, calling
on them to work together in support of his class action
lawsuit against prison administrators. Later, prison officials
discovered the letter in Jones’ cell and disciplined him for
violating a prison regulation that prohibited encouraging
disruption.
Jones filed suit pursuant to 42 U.S.C. § 1983 against
Warden E.K. McDaniel, Corrections Officer Mark Drain, and
Nevada Department of Corrections (“NDOC”) Director
Jackie Crawford (collectively, “defendants”), alleging
violations of his First and Fourteenth Amendment rights. The
district court granted Jones summary judgment on the due
process claim, but granted defendants summary judgment as
to the First Amendment claims. Following a jury trial on
damages in which Jones was awarded both nominal and
punitive damages, the parties entered into a settlement
agreement, according to which Jones received $11,000 plus
costs and attorney’s fees, as well as expungement of the
record of the violation, “in full satisfaction of the judgment
entered herein.” Jones then filed this appeal seeking review
of the district court’s adverse partial summary judgment order
regarding his First Amendment claims.
4 JONES V . MCDANIEL
The question in this case is whether Jones’ appeal may go
forward or whether it was rendered moot by the parties’
settlement agreement. We hold the latter and dismiss the
appeal.
I. Background
A. The Letter
In September 1999, Jones drafted a letter to his fellow
inmates, calling on them to “work togather [sic] and try and
tie this system in knots, by using the legal system and the
administrative grievence [sic] process to open the door for [a]
class action I am working on.” By “working together for our
common good,” Jones wrote, the inmates “[would] have a
loud voice” to “direct [their] distrust, dissatisfaction, rage and
intelligence in one direction (at the system) instead of at each
other.” Jones concluded by telling inmates to “read this[,]
and if you agree[,] just write your cell [number] on the back
and pass it to the next cell and I’ll get back to you with the
next step.” Jones did not circulate the letter broadly; he may,
however, have shown it to a few other inmates.
In September 2000, NDOC Corrections Officer Michael
Nustad searched Jones’ cell as part of an unrelated prison-
wide search. According to Jones, Officer Nustad was aware
that Jones previously had filed § 1983 actions against several
other corrections officers. Jones states that during the search
of his cell, he heard Officer Nustad tell another corrections
officer, “this is the case I was telling you about against the
Sarg, Rob and Grant. This is that assh–e.” At some point
during the search, Officer Nustad discovered the letter.
JONES V . MCDANIEL 5
B. Disciplinary Proceedings
The following day, Officer Nustad wrote up charges
against Jones for violating Code of Penal Discipline Section
MJ-28, which prohibits prisoners from “[o]rganizing,
encouraging or participating in a work stoppage or other
disruptive demonstration or practice.” The charging
document characterizes the letter as an “attempt to organize
and disrupt,” citing language from the letter calling on
inmates to “[tie] the system in knots” and “direct . . . distrust,
dissatisfaction, rage and intelligence . . . at the system.”
Corrections Officer Mark Drain served as the Hearing
Officer at Jones’ subsequent disciplinary hearing on the MJ-
28 charge. At the hearing, Officer Drain refused Jones’
request for a copy of the letter to review prior to or during the
proceedings. When Jones repeatedly asked for the letter to be
produced, Officer Drain removed him for “disrupting the
hearing.” Officer Drain then determined that Jones had
violated MJ-28, and issued sanctions of 180 days in
disciplinary segregation, 90 days loss of phone privileges, and
forfeiture of the letter.
Jones appealed Officer Drain’s determination to Warden
McDaniel, contending that the letter should have been
presented at the hearing, and that it was protected under the
First Amendment. Warden McDaniel upheld the finding and
sanctions. Having exhausted his appeals within the prison
system, Jones served the entirety of his disciplinary sanctions.
6 JONES V . MCDANIEL
C. Jones’ § 1983 Suit
1. Partial Summary Judgment Orders
Pursuant to 42 U.S.C. § 1983, Jones filed an amended
complaint against Officer Drain, Warden McDaniel, and
NDOC Director Crawford. Jones asserted three causes of
action: (1) violation of his procedural due process rights
stemming from Officer Drain’s refusal to produce the letter
at the disciplinary hearing; (2) violation of his First
Amendment rights and retaliation based on the exercise of his
right to free speech; and (3) violations of the First, Fifth, and
Fourteenth Amendments by Warden McDaniel and Crawford
based on their failure to supervise their subordinates. Jones
requested declaratory and injunctive relief, as well as
compensatory and punitive damages in excess of $10,000.
Magistrate Judge Robert McQuaid, Jr. issued a Report
and Recommendation (“R&R”) on the parties’ cross-motions
for summary judgment recommending that the court: (1)
grant Jones’ request for summary judgment as to the due
process claim; (2) grant defendants’ request for summary
judgment as to the First Amendment and retaliation claims;
and (3) grant Jones’ request for summary judgment on his
failure to supervise claim against Warden McDaniel, but deny
Jones’ request for the same claim as to Crawford. The district
court later issued an order accepting the R&R.
2. The Trial
Upon the district court’s finding that Officer Drain and
Warden McDaniel violated Jones’ due process rights, the
parties “proceed[ed] to trial solely on the issue of Mr. Jones’
JONES V . MCDANIEL 7
damages.”1 Magistrate Judge McQuaid, the same judge who
issued the R&R, presided over the trial. As in his amended
complaint, Jones sought nominal and punitive damages,2 as
well as injunctive and declaratory relief. At trial, Jones
argued that his disciplinary sanctions, particularly his
placement in disciplinary segregation, constituted an
exaggerated response to the uncirculated letter, thereby
entitling him to punitive damages.
The jury agreed and awarded Jones $2 in nominal
damages ($1 each for Officer Drain’s violation and Warden
McDaniel’s violation) and $11,000 in punitive damages.
That same day, the district court issued its “Judgement in a
Civil Case,” which ordered that Jones recover $11,002 from
defendants.
3. The Settlement
Following the district court’s entry of judgment in this
case, the parties filed various post-judgment motions.
Magistrate Judge McQuaid then held a “Status Conference”
to resolve the post-judgment motions.3 At the conference,
defendants agreed to pay Jones a total of $34,825.16, which
included Jones’ damages award of $11,0004 plus attorney’s
fees and costs. Defendants also agreed to expunge the
1
The parties “agreed to waive Jackie Crawford’s liability.”
2
A pretrial ruling precluded compensatory damages.
3
Jones attended the meeting by telephone; his attorney attended in
person along with defendants’ counsel.
4
Jones agreed at the conference to forego the $2 in nominal damages
awarded.
8 JONES V . MCDANIEL
official records of Jones’ MJ-28 violation and subsequent
discipline. Judge McQuaid then stated to Jones, “[i]n
exchange for that . . . you will execute a release of all claims,
releasing the defendants from all claims arising out of this
lawsuit.” Jones’ attorney responded that “since the case was
decided on the merits,” the term “release[]” may not be
appropriate. Judge McQuaid agreed, and indicated that the
agreement instead would be designated a “satisfaction of
judgment,” meaning that “the defendants paid the judgment
and it’s satisfied.” At that point, Judge McQuaid asked
Jones, “[n]ow, you agree to that settlement, Mr. Jones?” to
which Jones responded, “[y]es, I do, Your Honor.” The
parties then stipulated to withdraw all post-trial motions, and
Judge McQuaid concluded: “[t]hen it’s done. It’s all
done. . . . Just a Satisfaction of Judgment, that’s the last
document in the file and then the file will be closed.”
The parties thereupon executed an “Accord and
Satisfaction,” providing that the defendants agreed to pay
Jones a total of $11,800 plus $23,025.16 in attorney’s fees,
and to remove all record of the disciplinary charge. The
document then states that “Jones, by and through his attorney
. . . hereby acknowledge[s] receipt of payment . . . in full
satisfaction of the judgment entered herein and the accord
regarding post judgment disputes raised by the parties.”
4. The Appeal
Two days after executing the Accord and Satisfaction,
Jones filed a pro se Notice of Appeal of the district court’s
order adopting the R&R. Defendants moved to dismiss the
appeal on the grounds that the Accord and Satisfaction
resolved all of Jones’ claims against them. Alternatively,
defendants’ motion sought an indicative ruling from the
JONES V . MCDANIEL 9
district court pursuant to Federal Rule of Appellate Procedure
12.1 as to the scope of the Accord and Satisfaction. A
motions panel of this court denied the motion “without
prejudice to refiling if the district court issues an indicative
ruling.”
Defendants thereupon filed a “Motion for Indicative
Ruling” in the district court, seeking the court’s views as to
the scope of the Accord and Satisfaction. The district court
denied the motion because “there [were] not any outstanding
motions pending before [that] court on which to rule,” but
stated that, insofar as
the Court of Appeals was seeking this court’s
opinion as to the scope of the settlement
reached on June 29, 2010, it was [this court’s]
opinion that the case was fully and finally
settled on that date with no issues remaining
and that the case would be closed following
the filing of the Satisfaction of Judgment.
Based on the district court’s order, defendants renewed
their motion to dismiss the appeal. We denied the renewed
motion, and subsequently ordered the appointment of pro
bono counsel to represent Jones on appeal.
II. Discussion
A. Settlement & Mootness
We begin with some general observations regarding the
effect of a prior settlement on a case pending on appeal.
“Generally, when a party settles all of his personal claims
before appeal, an appeals court must dismiss the appeal as
10 JONES V . MCDANIEL
moot.” Smith v. T-Mobile USA Inc., 570 F.3d 1119, 1122
(9th Cir. 2009). That is because there is no “live case or
controversy” where “the parties’ settlement agreement has
resolved all facets of their dispute.” Gator.com Corp. v. L.L.
Bean, Inc., 398 F.3d 1125, 1131–32 (9th Cir. 2005) (en banc).
Thus, we have held, where a plaintiff “enter[s] into a
settlement agreement in which she agree[s] to relinquish ‘any
claims,’” against a defendant, a subsequent appeal of such a
claim is moot. Sanford v. MemberWorks, Inc., 625 F.3d 550,
556–57 (9th Cir. 2010).
The question in this case, then, is whether the parties’
Accord and Satisfaction “resolved all facets of their dispute,”
including Jones’ First Amendment claims, thereby rendering
this appeal moot. Gator.com Corp., 398 F.3d at 1132; see
also 13B Charles Alan Wright, Arthur R. Miller & Edward H.
Cooper, Federal Practice and Procedure § 3533.2, at 785 (3d
ed. 2008) (noting that a settlement moots only the issues the
parties intended to settle). According to Jones, the Accord
and Satisfaction is limited to the judgment entered on his due
process claim, and “has nothing to do with the First
Amendment claim[s].” Defendants disagree, urging that the
parties intended “to settle the entire litigation” at the June 29,
2010 Status Conference.
As a general matter, “‘[t]he construction and enforcement
of settlement agreements are governed by principles of local
law.’” O’Neil v. Bunge Corp., 365 F.3d 820, 822 (9th Cir.
2004) (quoting United Commercial Ins. Serv., Inc. v.
Paymaster Corp., 962 F.2d 853, 856 (9th Cir. 1992)). That
is true “even where a federal cause of action is settled or
released.” Botefur v. City of Eagle Point, 7 F.3d 152, 156
(9th Cir. 1993) (internal quotation marks and citations
omitted).
JONES V . MCDANIEL 11
Under Nevada law, “a settlement agreement[’s]
construction and enforcement are governed by principles of
contract law.” May v. Anderson, 119 P.3d 1254, 1257 (Nev.
2005). The “ultimate goal is to effectuate the contracting
parties’ intent.” In re Amerco Derivative Litig., 252 P.3d
681, 693 (Nev. 2011). Although any analysis of a
settlement’s terms starts with the language of the agreement,
“when that intent is not clearly expressed in the contractual
language, [courts] may also consider the circumstances
surrounding the agreement.” Id.B. The Accord & Satisfaction
We turn now to the settlement agreement at issue in this
case. Pursuant to the Accord and Satisfaction, the parties
agreed to withdraw all post-trial motions. Defendants also
agreed to pay Jones $11,000 in punitive damages, plus costs
and attorney’s fees, and to expunge all records of the
disciplinary charge. For his part, Jones gave up the nominal
damages and acknowledged receipt of the agreed-upon
payment “in full satisfaction of the judgment entered herein.”
There is only one judgment to which the statement “the
judgment entered herein” could possibly refer: the “Judgment
in a Civil Action” entered by the district court on March 31,
2010. On its face, that judgment makes no mention of Jones’
individual causes of action. It simply states that “[t]he court
has ordered that . . . Jones[] recover from [Officer Drain]
$1.00 in nominal damages, and $4,000.00 in punitive
damages, and that [Jones] recover from [Warden McDaniel]
$1.00 in nominal damages, and $7,000.00 in punitive
damages.”
12 JONES V . MCDANIEL
Jones maintains that because the “Judgement in a Civil
Action” does not mention his First Amendment claims, it
does not encompass the district court’s earlier partial
summary judgment order as to those claims. Thus, he argues,
the Accord and Satisfaction also does not cover those claims.
Not so. Orders granting partial summary judgment “are
not final appealable orders.” Dannenberg v. Software
Toolworks Inc., 16 F.3d 1073, 1074 (9th Cir. 1994) (internal
quotation marks omitted). “As a result, parties ordinarily
must obtain Rule 54(b) certification in order to appeal partial
summary judgments.” Id.; see Fed. R. Civ. P. 54(b). Absent
such certification, “[a] ruling on a motion for partial summary
judgment merges with the final judgment.” Adkins v.
Mireles, 526 F.3d 531, 538 (9th Cir. 2008); see also 15B
Charles Alan Wright, Arthur R. Miller, & Edward H. Cooper,
Federal Practice and Procedure § 3914.28 (2d ed. 1991 &
2008 Supp.).
Jones did not seek Rule 54(b) certification of the district
court’s order granting defendants summary judgment on the
First Amendment claims. Accordingly, that order merged
with the district court’s final judgment, i.e., the “Judgment in
a Civil Case.” Ordinarily, a partial summary judgment order
that has merged with the final judgment “is reviewable on
appeal from the final judgment.” Adkins, 526 F.3d at 538.
Here, however, the parties executed an agreement “in full
satisfaction” of the final judgment. By its plain terms, then,
the Accord and Satisfaction encompasses the district court’s
prior summary judgment ruling on Jones’ First Amendment
claims.
Moreover, at no point did Jones attempt to reserve his
right to appeal or otherwise exclude his First Amendment
JONES V . MCDANIEL 13
claims from the agreement. We can find no authority (and
Jones cites none) supporting Jones’ claim that his right to
appeal the First Amendment claims was automatically
preserved. To the contrary, we have held in related contexts
that “[i]n general, a party cannot appeal a judgment entered
with its consent” unless it “specifically preserves its right to
appeal.” Slaven v. Am. Trading Transp. Co., 146 F.3d 1066,
1070 (9th Cir. 1998). In executing the Accord and
Satisfaction, Jones essentially consented to the “full
satisfaction of the judgment entered herein,” which, as noted,
included the court’s prior ruling on Jones’ First Amendment
claims.
The circumstances surrounding the execution of the
Accord and Satisfaction confirm the parties’ intent to settle
all of Jones’ claims. At the June 29, 2010 Settlement
Conference, Judge McQuaid explained to Jones that, under
the terms of the agreement, Jones “will execute a release of
all claims, releasing defendants from all claims arising out of
this lawsuit.” At the parties’ request, Judge McQuaid
indicated that the agreement would be designated a
“satisfaction of judgment” instead of a “release,” meaning
that “the defendants paid the judgment and it’s satisfied.”
Judge McQuaid then asked Jones, “[n]ow, you agree to that
settlement, Mr. Jones?” to which Jones responded, “[y]es, I
do, Your Honor.”
Although Judge McQuaid’s statement that Jones would
release “all [of the] claims arising out of this lawsuit” was not
memorialized in the Accord and Satisfaction, that does not
mean Jones may escape the legal consequences of his assent.
Under Nevada law, a contract may be formed “when the
parties have agreed to the material terms, even though the
contract’s exact language is not finalized until later.” May,
14 JONES V . MCDANIEL
121 Nev. at 672. What matters, therefore, is that parties
intended to resolve the entire dispute at the settlement
conference, and so indicated orally. Nothing in the written
document is inconsistent with that intent.
In light of that intent, Jones’ reliance on the “usual rule in
the federal courts . . . that payment of a judgment does not
foreclose an appeal,” Milicevic v. Fletcher Jones Imports,
Ltd., 402 F.3d 912 (9th Cir. 2005), is misplaced. See also
Stanton Rd. Assocs. v. Lohrey Enters., 984 F.2d 1015, 1020
(9th Cir. 1993) (“The fact that payments have been made in
satisfaction of a money judgment does not foreclose an
appeal.”). As we noted in Milicevic, that general rule does
not apply where, as here, “there is some contemporaneous
agreement not to appeal, implicit in a compromise of the
claim after judgment.” Milicevic, 402 F.3d at 915. The
Nevada Supreme Court similarly recognizes that satisfaction
of a judgment “waives the right to appeal or renders the
matter moot when the payment is intended to compromise or
settle the matter.” Wheeler Springs Plaza, LLC v. Beemon,
119 Nev. 260, 265 (2003). That plainly is the case here.
Finally, it makes sense that Jones would have agreed to
resolve the entire dispute with defendants, so as to preclude
an appeal by the defendants. Jones initially sought in his
amended complaint “damages in excess of $10,000.” Under
the terms of the Accord and Satisfaction, that is precisely
what he received. That $11,000 punitive damages award,
moreover, represented a penalty against defendants for taking
disciplinary action against Jones following discovery of the
letter—namely, placing him in disciplinary segregation.
Although that damages award would not, by itself, preclude
Jones from seeking nominal damages for the alleged First
Amendment violations, it is unlikely that Jones would be
JONES V . MCDANIEL 15
entitled to additional damages for the disciplinary sanctions.
See, e.g., Elyousef v. O’Reilly & Ferrario, LLC, 245 P.3d
547, 549 (Nev. 2010) (holding that “[a] plaintiff may not
recover damages twice for the same injury simply because he
or she has two legal theories” (internal quotation marks
omitted)).
Further, defendants had already returned the letter to
Jones, and they agreed in the Accord and Satisfaction to
remove all records pertaining to the MJ-28 disciplinary
charges. In fact, much of the discussion at the June 2010
Status Conference centered on whether and how defendants
would expunge Jones’ disciplinary record. The expungement
was not part of the jury award; rather, it was relief bargained
for at the Status Conference. By agreeing to relinquish his
remaining claims against defendants in exchange for that
benefit, Jones obtained a remedy responsive to his First
Amendment concerns and not obtained in the course of
litigating the due process issue. Having received that relief,
it is difficult to see what further injunctive relief Jones could
have obtained were he permitted to proceed with his First
Amendment claims.
In short, given that Jones had obtained $11,000 in
damages, return of the letter, and expungement of the
violation and disciplinary sanctions, it is unsurprising that he
agreed to release his remaining claims against defendants and
did not seek to exclude his First Amendment claims from the
agreement.
Finally, we note that there is little reason to remand
Jones’ case to the district court for a determination as to the
scope of the settlement agreement. The district court has
already weighed in on the matter, stating its “opinion that the
16 JONES V . MCDANIEL
case was fully and finally settled on [June 29, 2010] with no
issues remaining.” We agree and, accordingly, dismiss
Jones’ appeal as moot. See Gator.com Corp., 398 F.3d at
1132.
DISMISSED.