IMPORTANT NEW FINALITY RULE FROM FOURTH CIRCUIT
(Posted August 17, 2022) Finality, and hence appealability, can be tricky. Today’s published order in Britt v. DeJoy is thus vital news for practitioners. The remarkable thing is, we don’t even learn today who wins the appeal.
This is an employment-discrimination suit brought by a postal worker. She added a count for retaliation. The district court dismissed the discrimination count with prejudice for failure to state a claim. It then dismissed the retaliation claim without prejudice, but didn’t grant leave to amend. The employee appealed.
But can she? A dismissal with prejudice is plainly final, but when the district court declines to apply the bar of prejudice, that looks more like an interlocutory order that isn’t appealable. Most such orders give the pleader X days to file an amended pleading or accept the ruling under protest and appeal immediately. This order didn’t address amendment at all.
The appeal matured to the point of oral argument – lucky litigants; 90% of Fourth Circuit appeals end without a single “May it please the Court” – last autumn. That panel evidently picked up on the jurisdictional issue. We learn today that the court sua sponte polled itself and decided to ask the parties for supplemental briefing for an en banc ruling on jurisdiction.
In a published order, the court discards an earlier rule that it felt was unworkable, and adopts one that’s based on the approaches used in the D.C. and Sixth Circuits: “We now hold that when a district court dismisses a complaint or all claims without providing leave to amend, we need not evaluate the grounds for dismissal or do anything more—the order dismissing the complaint is final and appealable.” This means that if a district court does what the court had done in this appeal, dismissing without prejudice but saying nothing about amendment, the Fourth will consider it to be a final, appealable order.
The order notes that this new rule can create a trap where a plaintiff gets a dismissal-without-prejudice order but wants to amend. The new rule means that the dismissal order is immediately appealable, and the plaintiff has to act promptly. A vigilant plaintiff will move the district court to reopen or vacate the judgment (FRCivP 59, 60). That postpones finality and appealability until the court adjudicates those motions. A different plaintiff might want to stand on the original pleading and appeal immediately. “To do so, however, the plaintiff must waive her right to amend the complaint by requesting that the district court take further action to finalize its decision.”
I’ve omitted one key component of today’s order: the outcome. Applying this new rule, the full court rules that the employee can indeed appeal the judgment here because the district court’s order meets the finality requirements. The en banc court then does something truly rare: Having granted en banc review, it sends the appeal back to the three-judge panel for a decision on the merits. That’s one that you don’t see every day.
Ultimately, the best rule for advocates is the simplest: You don’t play around with finality, because getting it wrong can have fatal consequences. Be proactive and protect your client’s appeal rights.