Derek Hoggett v. University of Phoenix , 863 F.3d 1105 ( 2017 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES and STATE OF No. 14-17492
CALIFORNIA ex rel. DEREK HOGGETT
and TAVIS GOOD, D.C. No.
Plaintiffs-Appellants, 2:10-cv-02478-
MCE-EFB
v.
UNIVERSITY OF PHOENIX; APOLLO OPINION
GROUP, INC.,
Defendants-Appellees.
Appeal from the United States District Court
for the Eastern District of California
Morrison C. England, Jr., District Judge, Presiding
Argued and Submitted February 14, 2017
San Francisco, California
July 25, 2017
Before: Ronald M. Gould and Marsha S. Berzon, Circuit
Judges, and Marvin J. Garbis, * District Judge.
Opinion by Judge Gould
*
The Honorable Marvin J. Garbis, United States District Judge for
the District of Maryland, sitting by designation.
2 U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX
SUMMARY **
Appellate Jurisdiction
The panel dismissed as untimely relators’ appeal from
the dismissal of their qui tam suit under the False Claims
Act.
The panel held that the relators’ post-judgment motion,
styled as a motion to alter or amend the judgment under Fed.
R. Civ. P. 59, was in substance a motion only to stay entry
of judgment and therefore did not toll the time to file a notice
of appeal under Fed. R. App. P. 4(a)(4).
COUNSEL
Daniel R. Bartley (argued), Bartley Law Offices, Campbell,
California, for Plaintiffs-Appellants.
Jonathan C. Bunge (argued), Quinn Emanuel Urquhart &
Sullivan LLP, Chicago, Illinois; Leonid Feller, Kirkland &
Ellis LLP, Chicago, Illinois; Todd Michael Noonan, DLA
Piper LLP, Sacramento, California; for Defendants-
Appellees.
**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX 3
OPINION
GOULD, Circuit Judge:
Relators Derek Hoggett and Tavis Good (collectively
“Relators”) appeal the district court’s dismissal of their qui
tam lawsuit against the University of Phoenix and the Apollo
Group (collectively “UOPX”). Relators allege that UOPX
violated the False Claims Act (FCA), 31 U.S.C. §§ 3729–
3733, and the California False Claims Act, Cal. Gov’t Code
§§ 12650–12656, by knowingly submitting false
certifications and making false statements to the government
that it was complying with the recruiter incentive
compensation ban in order to receive federal student
financial aid funding under Title IV of the Higher Education
Act (HEA). We conclude that their appeal is untimely, and
we dismiss for lack of jurisdiction.
I
UOPX is one of the largest for-profit post-secondary
education providers in the United States. It receives large
amounts of money from the federal government in the form
of Title IV student financial aid. In December 2009, UOPX
entered into a settlement agreement for $67,500,000 with the
United States and two relators, Mary Hendow and Julie
Albertson, to settle a qui tam lawsuit involving allegations
that UOPX violated the FCA by presenting claims to the
government for payment in connection with Title IV
programs. Settlement Agreement, United States ex rel.
Hendow v. Univ. of Phoenix, No. 2:03-cv-00457-GEB-DAD
(E.D. Cal. Dec. 16, 2009), ECF No. 345, Ex. A. The
allegations asserted that UOPX falsely certified that it was
in compliance with the HEA provision relating to incentive
compensation, 20 U.S.C. § 1094(a)(20), and/or the
4 U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX
associated regulations, 34 C.F.R. § 668.14(b)(22). Id. at 2. 1
The settlement covered the period from March 1997 to
December 11, 2009, and did not include an
acknowledgment, admission, or concession of wrongdoing.
Id. at 2, 13–15.
Relators were enrollment counselors at UOPX during
part of the time period covered by the Hendow settlement
and after December 11, 2009. On September 15, 2010,
Relators filed this suit, alleging that UOPX continued to
knowingly violate the incentive compensation ban after the
settlement period in Hendow. The government declined to
intervene.
After discovery, UOPX filed a motion to dismiss
Relators’ complaint for lack of jurisdiction. On July 24,
2014, the district court dismissed the case with prejudice,
concluding that it did not have jurisdiction because of the
1
To receive funds under Title IV of the HEA, “schools must enter
with the [Department of Education] into a Program Participation
Agreement, in which they agree to abide by a host of statutory,
regulatory, and contractual requirements.” United States ex rel. Lee v.
Corinthian Colls., 655 F.3d 984, 989 (9th Cir. 2011). One of these
requirements is the “recruiter-incentive compensation ban, which
prohibits institutions from paying recruiters ‘incentive payments’ based
on the number of students they enroll.” Id. A safe harbor provision
“provides that an educational institution may, without violating the ban
on incentive compensation, provide ‘payment of fixed compensation,
such as a fixed annual salary or a fixed hourly wage, as long as that
compensation is not adjusted up or down more than twice during any
twelve month period, and any adjustment is not based solely on the
number of students recruited, admitted, enrolled, or awarded financial
aid.’” Id. (quoting 34 C.F.R. § 668.14(b)(22)(ii)(A) (2010)). This safe
harbor provision was eliminated effective July 2011, after this suit was
filed. Id. at 989 n.1.
U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX 5
public disclosure bar. 2 See 31 U.S.C. § 3730(e)(4). On
August 21, 2014, Relators filed a post-judgment motion
captioned “Relators’ Motion, Pursuant to FRCP Rule 59(e),
to Stay the Order Dismissing and Final Judgment, Pending
Ninth Circuit Court of Appeals Decision in the United States
ex rel. Lee v. Corinthian Colleges.” The district court denied
Relators’ motion on November 18, 2014. Relators filed a
notice of appeal—as to both the dismissal of their case and
the order denying their post-judgment motion—on
December 14, 2014.
II
“A timely notice of appeal is mandatory and
jurisdictional.” Bordallo v. Reyes, 763 F.2d 1098, 1101 (9th
Cir. 1985). If an appeal is untimely, the Court of Appeals
lacks jurisdiction and must dismiss the appeal. United States
ex rel. Haight v. Catholic Healthcare W., 602 F.3d 949, 953
(9th Cir. 2010). We conclude that we lack jurisdiction to
consider this appeal because it is untimely.
Ordinarily, if the government declines to intervene in a
qui tam FCA action, the relator must file a notice of appeal
within 30 days after the district court’s entry of final
2
The FCA’s public disclosure bar was amended by the Patient
Protection and Affordable Care Act, Pub. L. No. 111-148, 124 Stat. 119,
in March 2010. See Graham Cty. Soil & Water Conservation Dist. v.
United States ex rel. Wilson, 559 U.S. 280, 283 n.1 (2010). Before those
amendments, the public disclosure bar deprived federal courts of subject
matter jurisdiction when the fraud had been publically disclosed, unless
the relator was an “original source.” 31 U.S.C. § 3730(e)(4)(A) (2006).
We recently held that the 2010 amendments transformed the public
disclosure bar from a jurisdictional bar into an affirmative defense. See
Prather v. AT&T, Inc., 847 F.3d 1097, 1103 (9th Cir. 2017). Because
we dismiss this appeal as untimely, we do not reach and address any
effect that Prather may have had on this case.
6 U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX
judgment. United States ex rel. Eisenstein v. City of New
York, 556 U.S. 928, 937 (2009); Fed. R. App. P. 4(a)(1)(A).
However, if a party files one of the motions listed in Federal
Rule of Appellate Procedure (FRAP) 4(a)(4)(A), the time to
file a notice of appeal is tolled during the motion’s pendency.
Relevant here, FRAP 4(a)(4)(A) includes motions to alter or
amend the judgment under Federal Rule of Civil Procedure
(FRCP) 59 so long as the motion is filed no later than 28 days
after the entry of judgment. See Fed. R. App. 4(a)(4)(A)(iv);
Fed. R. Civ. P. 59(e). If an FRCP 59 motion to alter or
amend the judgment is timely filed, the time to file a notice
of appeal begins to run “from the entry of the order disposing
of” the FRCP 59 motion. Fed. R. App. P. 4(a)(4)(A).
Here, Relators filed a post-judgment motion—styled as
a FRCP 59(e) motion—within 28 days after the entry of
judgment, and filed the notice of appeal within 30 days after
the district court denied that motion. Nonetheless, UOPX
argues Relators’ appeal was untimely. UOPX asserts that
Relators’ post-judgment motion, although styled as a Rule
59(e) motion, was in substance a motion only to stay the
entry of judgment, which does not toll the time to file a
notice of appeal. We agree.
A motion’s “nomenclature is not controlling.” Miller v.
Transamerican Press, Inc., 709 F.2d 524, 527 (9th Cir.
1983) (quoting Sea Ranch Ass’n v. Cal. Coastal Zone
Conservation Comm’ns, 537 F.2d 1058, 1061 (9th Cir.
1976)). Instead, we “construe [the motion], however styled,
to be the type proper for the relief requested.” Id. (construing
a motion styled as an FRCP 59(e) motion as an FRCP 60(a)
motion because the court’s amendment memorialized a prior
oral ruling, and was thus a correction of a clerical error
properly addressed under FRCP 60(a)). We must therefore
look to the substance, not simply the title, of Relators’ post-
U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX 7
judgment motion to determine whether it is in substance a
motion to alter or amend the judgment.
“[A] postjudgment motion will be considered a Rule
59(e) motion [to alter or amend the judgment] where it
involves ‘reconsideration of matters properly encompassed
in a decision on the merits.’” Osterneck v. Ernst & Whinney,
489 U.S. 169, 174 (1989) (quoting White v. N.H. Dep’t of
Emp’t Sec., 455 U.S. 445, 451 (1982)); see also Buchanan v.
Stanships, Inc., 485 U.S. 265, 268–69 (1988) (concluding
that a post-judgment motion for costs styled as a motion to
alter or amendment the judgment was not an FRCP 59(e)
motion because “[a]ssessment of such costs [predicated on
FRCP 54(d)] does not involve reconsideration of any aspect
of the decision on the merits”). “[T]o alter or amend the
judgment . . . requir[es] a ‘substantive change of mind by the
court.’” Bordallo, 763 F.2d at 1102 (quoting Miller, 709
F.2d at 527). A motion that does not request a substantive
change of mind by the court is not an FRCP 59(e) motion to
alter or amend the judgment. See id.
Here, Relators’ motion did not argue for a substantive
change in the district court’s decision. Relators did not
contend that the district court clearly erred, present the
district court with newly discovered evidence, or assert an
intervening change in the controlling law. See Wood v.
Ryan, 759 F.3d 1117, 1121 (9th Cir. 2014). In other words,
Relators presented no ground upon which the district court
could grant a motion to alter or amend its judgment. See id.
(“A district court may grant a Rule 59(e) motion if it ‘“is
presented with newly discovered evidence, committed clear
error, or if there is an intervening change in the controlling
law.”’” (emphasis omitted) (quoting McDowell v. Calderon,
197 F.3d 1253, 1255 (9th Cir. 1999) (en banc) (per
curiam))). Instead, Relators said they were asking the
8 U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX
district court to “amend” the order and judgment, but
actually only asked for a stay until this court decided the
then-pending appeal in United States ex rel. Lee v.
Corinthian Colleges, Court of Appeals No. 13-55700. 3 We
will “not strain to characterize artificially” a motion as
something it is not, simply to keep an appeal alive. Munden
v. Ultra-Alaska Assocs., 849 F.2d 383, 386 (9th Cir. 1988).
Relators’ motion was not, in substance, an FRCP 59(e)
request to alter or amend the judgment; it was a request to
stay.
Relators’ argument that they properly urged the district
court to amend the substance of its decision by incorporating
the arguments set forth in an amicus brief (filed in Lee) that
Relators attached to their post-judgment motion is
unpersuasive. The post-judgment motion states: “As
reflected in [the attached] 30-page amicus curiae brief, the
public disclosure bar is a strongly contested issue in the
Corinthian Colleges case. In its subject amicus brief filed in
Lee, DOJ asserts, inter alia, that the lawsuits with similar
allegations filed against other schools should not trigger the
public disclosure bar.” Relators did not explain how the
arguments made in the amicus brief applied to the district
court’s order, how that brief showed an intervening change
in the law, or how those arguments or legal authorities
showed that the district court erred. 4
3
This court issued a memorandum disposition in United States ex
rel. Lee v. Corinthian Colleges on June 9, 2016, affirming the district
court’s dismissal for lack of subject matter jurisdiction. 652 F. App’x
503 (9th Cir. June 9, 2016).
4
To the extent Relators assert that the amicus brief itself constitutes
new legal authority presented to the district court, we reject this
argument. A brief—amicus or otherwise—is not legal authority.
U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX 9
III
We recognize that by looking to the substance of the
motion and the relief requested, we place the burden “upon
the party seeking to appeal the obligation to determine for
itself whether a motion denominated as a[n FRCP] 59(e)
motion does in fact fall within the parameters for which that
rule is designed.” Fincher v. Keller Indus., Inc., 905 F.2d
691, 693 (3d Cir. 1990) (holding that a motion filed “as a
Rule 59(e)” was not a motion to alter or amend the judgment
and did not toll the time to file an appeal because the “motion
for costs was wholly collateral to the judgment on the
merits”). This result, however, is required by precedent from
the Supreme Court and our circuit. See, e.g., Buchanan,
485 U.S. at 266–69; Miller, 709 F.2d at 527.
Relators had options other than incorrectly calling a
motion to stay a “Motion[] Pursuant to FRCP Rule 59(e).” 5
If Relators wanted the district court to consider our decision
in Lee, they could have filed a motion in the district court
seeking a stay of the case pending Lee before the district
court entered its judgment. 6 See Leyva v. Certified Grocers
of Cal., Ltd., 593 F.2d 857, 863–64 (9th Cir. 1979) (“A trial
court may, with propriety, find it is efficient for its own
docket and the fairest course for the parties to enter a stay of
an action before it, pending resolution of independent
5
Although we note various courses of action Relators could have
taken, we take no position on whether these motions, if filed, would have
or should have been granted.
6
The appeal in Lee was docketed more than a year before the district
court entered its order and judgment in Relators’ case. Indeed, the
amicus brief that Relators wanted the district court to consider was filed
almost eight months before the district court entered its order and
judgment.
10 U.S. EX REL. HOGGETT V. UNIVERSITY OF PHOENIX
proceedings which bear upon the case. This rule . . . does
not require that the issues in such proceedings are
necessarily controlling of the action before the court.”). The
district court could have entered a stay under its authority to
control its own docket “to provide for a just determination of
the cases pending before it.” Id. at 864.
Alternatively, after the district court entered its order and
judgment, Relators could have filed a timely notice of appeal
and then filed a motion in this court to stay the appeal
pending Lee. They could also, of course, have simply
allowed their appeal to proceed and argued that we should
take Lee into consideration, once it was decided. 7
Relators did not exercise any of these options. Because
their post-judgment motion did not ask for a substantive
change to the district court’s decision, it was not an FRCP
59(e) motion to alter or amend the judgment, regardless of
its title. Instead, it was a motion to stay, which does not toll
the time for filing a notice of appeal. See Fed. R. App. P.
4(a)(4)(A). Relators filed their notice of appeal as to the
dismissal of their case almost four months too late. We lack
jurisdiction to consider it. 8
DISMISSED.
7
If our decision in Lee issued after briefing concluded, Relators
could have brought it to our attention by filing a 28(j) letter. See Fed. R.
App. P. 28(j).
8
Relators did not raise any arguments relating to the denial of their
post-judgment motion in their Opening Brief. They have therefore
waived any argument related to the district court’s denial of that motion.
See, e.g., Alaska Ctr. for Env’t v. U.S. Forest Serv., 189 F.3d 851, 858
n.4 (9th Cir. 1999) (“Arguments not raised in opening brief are
waived.”).