Everett, M.A. v. US Airways Group Inc ( 1998 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 7, 1997 Decided January 6, 1998
No. 96-7158
M.A. Everett, et al.,
Appellants
v.
US Airways Group, Inc., et al.,
Appellees
Appeal from the United States District Court
for the District of Columbia
(No. 95cv00990)
Brian W. Shaughnessy argued the cause for appellants,
with whom Philip A. Gagner and Lester A. Katz were on the
briefs.
Neal D. Mollen argued the cause for appellees, with whom
Zachary D. Fasman and Erin M. Sweeney were on the brief.
Before: Ginsburg, Sentelle and Rogers, Circuit Judges.
Opinion for the court filed by Circuit Judge Sentelle.
Sentelle, Circuit Judge: A group of retired and active US
Airways pilots (collectively, "Pilots") appeal from a decision of
the district court dismissing two claims as subject to manda-
tory arbitration under the Railway Labor Act ("RLA"), 45
U.S.C. ss 151 et seq., and staying proceedings on a third
claim pending the outcome of that arbitration. Because the
district court's order is not final, and no exception to the final
order rule applies, we dismiss the appeal for lack of appellate
jurisdiction.
I
Around 500 retired and active US Airways pilots sued US
Airways Group, Inc. and its pension fund (collectively, "US
Airways") for: (1) failure to pay approximately $70 million in
benefits due under Sections 1054(g) and 1132(a)(1)(B) of the
Employee Retirement Income Security Act ("ERISA"), 29
U.S.C. ss 1001 et seq.; (2) violation of ERISA's disclosure
provision, 29 U.S.C. s 1022; and (3) breach of ERISA fiducia-
ry duties, 29 U.S.C. s 1104. The Pilots are each eligible for
pension benefits under a plan collectively bargained in 1972
between US Airways and the Air Line Pilots Association
("ALPA"). This 1972 collective bargaining agreement re-
placed the pension benefits of participants under a prior plan
with a "minimum benefit" based in part on "the investment
performance of the Standard and Poor's 500 stock index
(unadjusted for dividends)." The Pilots allege that US Air-
ways has improperly interpreted the relevant language of the
1972 agreement by excluding dividends from its benefit com-
putations.
On motion for summary judgment, the district court dis-
missed Counts (1) and (3), holding that the district court
lacked subject matter jurisdiction over these claims because
they depended on the proper interpretation of a collective
bargaining agreement and thus were subject to mandatory
arbitration under the RLA. See Everett v. USAir Group,
Inc., 927 F. Supp. 478, 482-83 (D.D.C. 1996). The district
court retained jurisdiction over Count (2), holding that even if
US Airways properly interpreted the agreement, it had an
independent duty under ERISA to provide a summary plan
description that was "calculated to be understood by the
average plan participant." Id. at 484. The district court
stayed proceedings on Count (2) until the end of the arbitral
process. Id.Claiming among other things futility of resort to an arbitra-
tion process controlled by US Airways and ALPA, both of
whom the Pilots believe have interests adverse to their own,
the Pilots ask this court to reverse the district court's dis-
missal of Counts (1) and (3). Because the order of the
district court is not final, we have no jurisdiction to reach the
merits of the Pilots' claims.
II
Our jurisdiction to review judgments of the district court is
limited to "appeals from all final decisions," 28 U.S.C. s 1291
(emphasis added), and to interlocutory appeals that fall within
the narrow exceptions defined by 28 U.S.C. s 1292. Thus, we
cannot review this case unless the judgment of the district
court is final or one of the conditions enumerated in s 1292 is
satisfied.
A final decision "ends the litigation on the merits and
leaves nothing for the court to do but execute the judgment."
Catlin v. United States, 324 U.S. 229, 233 (1945). The
question presented by this case is whether the order may be
considered final because the district court dismissed two of
the claims for lack of subject matter jurisdiction and the stay
of the third claim is, arguably, effectively unreviewable. The
Federal Rules of Civil Procedure speak directly to these
issues, providing in relevant part:
When more than one claim for relief is presented in an
action, ... the court may direct the entry of a final
judgment as to one or more but fewer than all of the
claims ... only upon an express determination that
there is no just reason for delay and upon an express
direction for the entry of judgment. In the absence of
such determination and direction, any order ... which
adjudicates fewer than all the claims ... shall not
terminate the action as to any of the claims....
Fed. R. Civ. P. 54(b) (emphasis added); see also Summers v.
United States Dep't of Justice, 999 F.2d 570, 571 n.1 (D.C.
Cir. 1993) (citing Kappelmann v. Delta Air Lines, Inc., 539
F.2d 165 (D.C. Cir. 1976)); 15A Wright et al., Federal
Practice and Procedure s 3914.7, at 544 (2d ed. 1992) (de-
scribing the bright-line rule that "[a]bsent an express di-
rection for entry of judgment, an order that disposes of less
than all the claims--no matter with what firmness and appar-
ent finality--is not appealable....").
In the instant litigation, the trial court dismissed two of
three claims, but stayed Count (2) pending the outcome of
arbitration. The stay of judgment on a claim pending arbi-
tration does not constitute a final ruling by the trial court
with respect to that claim. See McCowan v. Dean Witter
Reynolds Inc., 889 F.2d 451, 453-54 (2d Cir. 1989) (holding
that an order dismissing two claims and referring two others
to arbitration is not final). Thus, the district court adjudicat-
ed "fewer than all the claims" and, without the express
determination and direction required by Rule 54(b), the judg-
ment cannot be considered final "as to any of the claims." Of
course, entry of judgment according to Rule 54(b) is not alone
sufficient to confer appellate jurisdiction--an appellate court
must also satisfy itself that the district court applying Rule
54(b) properly determined the particular claims to be final
and distinct from other claims in the litigation. See Gold Seal
Co. v. Weeks, 209 F.2d 802, 807 (D.C. Cir. 1954) (noting that
Rule 54(b) only permits entry of final judgment with respect
to "a claim distinct from the other claim or claims"); Inver-
world, Ltd. v. Commissioner, 979 F.2d 868, 874 (D.C. Cir.
1992) ("Rule 54(b) does not 'create' finality under s 1291
where it does not already exist...."). But this does not
imply, as the Pilots contend, that compliance with Rule 54(b)
is unnecessary. Where, as here, the district court adjudicates
fewer than all of the claims, finality with respect to certain
claims, while not a sufficient condition for appellate review of
those claims, is a necessary one. Barring some other excep-
tion to the final decision rule, appellate review of an order
which does not decide all the claims presented requires both
finality with respect to the adjudicated claims and entry of
judgment on those claims in accordance with Rule 54(b).
Because the latter condition is not met in this case, the
district court's order cannot be considered final with respect
to any of the claims.
The Pilots also try to bring the district court's ruling within
the narrow "collateral order" exception to the doctrine of
finality as set forth in Cohen v. Beneficial Industrial Loan
Corp., 337 U.S. 541, 545-47 (1949). We have recognized that
"[t]o fall within the small class of decisions excepted from the
final judgment rule by Cohen, the order must conclusively
determine the disputed question, resolve an important issue
completely separate from the merits of the action, and be
effectively unreviewable on appeal from a final judgment."
Summers v. United States Dep't of Justice, 925 F.2d 450, 453
(D.C. Cir. 1991) (quoting Coopers & Lybrand v. Livesay, 437
U.S. 463, 468 (1978)) (internal quotation marks omitted). The
Pilots initially contended that because they expect the retire-
ment board to rule against them, and because under the RLA
an arbitration decision is "effectively unreviewable," the prac-
tical effect of the referral to arbitration will be to end the
entire case. Not only have the Pilots failed to explain why
this should imply finality with respect to the disclosure viola-
tions alleged in Count (2), but both parties agreed at oral
argument that at the end of arbitration, after a final judg-
ment from the district court on the entire case, this Court
could review any error in the initial decision dismissing
Counts (1) and (3) as subject to mandatory arbitration. Thus,
neither the decision to refer Counts (1) and (3) to arbitration
nor the stay of Count (2) are "effectively unreviewable on
appeal from a final judgment," and the collateral order excep-
tion does not apply.
The Pilots also urge upon us a "practical finality" doctrine
drawn from Gillespie v. United States Steel Corp., 379 U.S.
148 (1964). Discussing Cohen, Gillespie recognized that the
finality requirement should be given "a practical rather than
a technical construction." Id. at 152 (quoting Cohen, 337 U.S.
at 546). Gillespie noted that in "marginal cases," i.e., where
finality is a close question, courts should consider the "incon-
venience and costs of piecemeal review" as well as the "dan-
ger of denying justice by delay." Id. at 152-53. The Pilots
argue that Gillespie expands the set of exceptions to the
finality rule, and some authority supports that proposition.
See, e.g., Service Employees Int'l Union, Local 102 v. County
of San Diego, 60 F.3d 1346, 1349-50 (9th Cir. 1995), cert.
denied, 116 S. Ct. 774 (1996) (finding appellate jurisdiction to
rule on a central legal question arising from a "marginally
final" order when the only remaining proceeding in the
district court was a calculation of damages); Travis v. Sulli-
van, 985 F.2d 919, 922-23 (7th Cir. 1993) (holding that a
district court order remanding proceedings to an agency
under particular statutory provisions was immediately appeal-
able even though not fitting precisely within the contours of
the collateral order rule). But it is just as plausible that the
Gillespie dictum does nothing more than discuss application
of existing doctrine. As we have noted, "No federal appellate
court, to our knowledge, has ever followed the Gillespie
dictum in a case in which the appeal could not be justified on
the basis of some other, narrower, policy demanding deviation
from the finality rule." Green v. Department of Commerce,
618 F.2d 836, 841 (D.C. Cir. 1980).
We recognize the warning of the Supreme Court that "[i]f
Gillespie were extended beyond the unique facts of that case,
s 1291 would be stripped of all significance." Coopers &
Lybrand, 437 U.S. at 477 n.30. As we have already dis-
cussed, the Pilots have an adequate remedy on appeal from a
final judgment, and the Cohen exception therefore does not
apply. We decline--at least on these facts--to hold that
Gillespie provides an additional exception to the finality rule
or otherwise expands the set of cases deemed final under the
collateral order doctrine. In summary, the judgment of the
district court cannot be deemed final and subject to appeal
under s 1291.
The Pilots further argue that the judgment qualifies for
interlocutory appeal under 28 U.S.C. s 1292(a)(1), which con-
fers jurisdiction over appeals from district court orders
"granting, continuing, modifying, refusing or dissolving in-
junctions." They rely on Carson v. American Brands, Inc.,
450 U.S. 79 (1981), in which the Supreme Court held that this
provision also allows in some cases appeals from orders
having "the practical effect of refusing an injunction." Id. at
84. The district court in Carson had refused to enter a
proposed consent decree which would have required one
party to give hiring and seniority preferences on the basis of
race. Id. at 81. The heart of the rejected settlement in-
volved "prospective relief" that would have "permanently
enjoined respondents from discriminating against black em-
ployees." Id. at 84. The Court held that because rejection of
the settlement could not be "effectually challeng[ed]" and
plainly had a "serious, perhaps irreparable, consequence," the
order should be deemed immediately appealable within the
ambit of s 1292(a)(1). Id. at 86.
The instant case is readily distinguishable from Carson.
The Pilots have sought no relief which we could properly
deem injunctive. Asking the court to enjoin US Airways to
interpret pension provisions in a certain fashion merely re-
states the Pilots' claim for benefits under ERISA. Indeed,
not only do we find dubious the Pilots' claim that the order
has the effect of denying injunctive relief, but Carson also
requires that "[u]nless a litigant can show that an interlocu-
tory order of the district court might have a serious, perhaps
irreparable, consequence, and that the order can be effectual-
ly challenged only by immediate appeal, the general congres-
sional policy against piecemeal review will preclude interlocu-
tory appeal." Id. at 84 (internal quotation marks omitted).
As already discussed at length, the district court's order can
be adequately challenged by appeal from a final judgment
issued after the completion of arbitration. The Pilots will
suffer no harm sufficient to invoke the interlocutory review
provisions of s 1292(a)(1).
CONCLUSION
We conclude that the partial dismissal by the district court
neither constitutes a final order nor satisfies any of the
exceptions to the finality rule. We therefore dismiss the
appeal for lack of appellate jurisdiction.