A Court Must Expressly Retain Jurisdiction to Enforce the Terms of a Settlement Agreement

In Mirsad Hajro and James R. Mayock v. United States Citizenship and Immigration Services, et al. (collectively, “USCIS”), 2016 S.O.S. 11-17948, The Ninth US Circuit Court of Appeals held that it had jurisdiction to review the district court’s summary judgment order under FRAP 4(a)(2) but dismissed appellant, USCIS’s, challenge to the permanent injunction for lack of jurisdiction. The panel filed an amended opinion on January 19, 2016 vacating the permanent injunction, reversing the summary judgment order, vacating the attorneys’ fees award, and remanding for further proceedings in a Freedom of Information Act (“FOIA”) action brought against USCIS by permanent resident, Misrad Hajro, and his attorney, James Mayock.

Plaintiffs filed the action in March of 2008 seeking declaratory and injunctive relief under FOIA and the Administrative Procedures (“APA”), and enforcement of a Settlement Agreement that had been executed in 1992 between Mr. Mayock and the Immigration and Naturalization Service (“INS”)–USCIS’s predecessor agency. In the Settlement Agreement, the INS agreed to implement expedited processing of FOIA requests when the safety of an individual was jeopardized or the requestor’s substantive due process rights would be impaired. In 2003, Mr. Hajro applied for naturalization and was denied on the grounds that his alien registration file contained evidence that he had falsely testified about his foreign military service. When Mr. Hajro submitted a FOIA request for this file in 2007, he requested expedited processing but it was denied and USCIS failed to timely issue his request. Accordingly, plaintiffs filed the instant lawsuit for, inter alia, violations of the Settlement Agreement.

In granting summary judgment in favor of the plaintiffs, the district court found that USCIS had engaged in a pattern or practice violating the FOIA’s time limits and other requirements in complying with requests for information pursuant to 5 U.S.C. §522(a)(6)(A), (B), (C) (2012). The USCIS challenged the district court’s jurisdiction to enforce the Settlement Agreement given that the case was dismissed with prejudice, without incorporating the terms of the settlement or expressly retaining jurisdiction, and the Settlement Agreement was subsequently filed with the Court. Although the summary judgment order was entered on October 13, 2011 the district court did not enter a permanent injunction until May 7, 2012 after receiving input from both parties in defining its scope and form. USCIS filed a notice of appeal on December 12, 2011.

The first issue in the appeal was whether the notice of appeal was timely given that it was filed after the summary judgment order but before entry of the actual permanent injunction. Noting the time requirements for filing a notice of appeal pursuant to FRAP 4(a)(B)(1)(B) (“sixty days of the date of a final judgment or an appealable order”) the panel recognized that FRAP 4(a)(2) permits a party to prematurely file an appeal only where all that remains is the “ministerial task” of entering a judgment.

In determining whether the appeal was valid, the panel analogized the present set of facts to Kennedy v. Applause, Inc., 90 F.3d 1477, 1482–83 (9th Circ. 1996). At issue in Kennedy, was whether a notice of appeal, that was filed after entry of an order granting summary judgment, but before attorneys’ fees and costs were determined. Ultimately, the panel addressed the merits of the summary judgment order but dismissed the appellant’s challenge to the award of attorneys’ fees because it lacked jurisdiction.

In comparing Kennedy to the set of facts in the present case, the panel determined that the notice of appeal was premature in that the Court had not yet finalized the language of the permanent injunction and the scope was still being debated by the parties. This further debate was determined to not be merely “ministerial” in nature and, as a result, the panel declined authority to hear the challenge to the scope of the permanent injunction. Notwithstanding this lack of jurisdiction, the panel vacated the permanent injunction because it did have jurisdiction to reverse and remand the summary judgment order––upon which the permanent injunction was predicated.

In reviewing the summary judgment order, the panel analyzed the impact of the Supreme Court’s decision in Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375 (1994), which provides that a district court does not have the inherent power to enforce the terms of the settlement agreement under the doctrine of ancillary jurisdiction. Citing interpreting case law, the panel unambiguously stated that all courts must apply rules announced by the Supreme Court retroactively, unless stated otherwise, especially cases involving jurisdictional issues.

Despite acknowledging the “harsh consequence” of the retroactive application, the panel held that the jurisdictional rule set forth in Kokkonen applied to the 1992 Settlement Agreement and therefore the district court did not have the inherent power to enforce the terms of the Settlement Agreement. In addition, the panel held that while the district court may assert supplemental jurisdiction of the Settlement Agreement claims, plaintiffs failed to show an “unequivocally expressed” waiver of sovereign immunity.

This case highlights two important reminders for counsel. First, notices of appeal must be timely made after the entry of a final or appealable order, which includes entry of permanent injunctions and the determination of attorneys’ fees and costs. Second, in dismissing a case, with prejudice, where a Settlement Agreement is in place, the parties should have the dismissal incorporate the terms of the Settlement Agreement or expressly indicate that the court is to retain jurisdiction.

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January 22, 2016