Myers v. Richland County

• Decision Date: 16 November 2005
• Docket Number: No. 04-3653.,04-3653.
• Citation: 429 F.3d 740
• Parties: Earle MYERS, Jr., also known as "Bud," Appellant, v. RICHLAND COUNTY; Bryan L. Flaa; Don Holen; Lynn C. Larsen; Tim Campbell; Joel Dotzenrod, Richland County Commissioners, in their official capacities; Ray Ward; Steve Campbell; Merlin Berg; Dave Paulson, former Richland County Commissioners, in their individual and official capacities, Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 740

429 F.3d 740

Earle MYERS, Jr., also known as "Bud," Appellant, v. RICHLAND COUNTY; Bryan L. Flaa; Don Holen; Lynn C. Larsen; Tim Campbell; Joel Dotzenrod, Richland County Commissioners, in their official capacities; Ray Ward; Steve

Campbell; Merlin Berg; Dave Paulson, former Richland County Commissioners, in their individual and official capacities, Appellees.

No. 04-3653.

United States Court of Appeals, Eighth Circuit.

Submitted: September 14, 2005.

Filed: November 16, 2005.

COPYRIGHT MATERIAL OMITTED

Patricia Rudck Monson, argued, Fargo, ND, for appellant.

Ronald Francis Fischer, argued, Grand Forks, ND, for appellee.

Before MURPHY, HANSEN, and GRUENDER, Circuit Judges.

GRUENDER, Circuit Judge.

Earle Myers, Jr. ("Myers") brought this action for breach of contract, intentional infliction of emotional distress ("IIED") and defamation arising from an alleged violation of a settlement agreement. The district court granted the defendants' motion for summary judgment as to all three claims. For the reasons discussed below we affirm the district court's grant of summary judgment on the breach of contract claim, vacate the grant of summary judgment on the IIED and defamation claims and remand with instructions to dismiss the IIED and defamation claims for lack of jurisdiction.

I. BACKGROUND

Myers served as the elected State's Attorney for Richland County, North Dakota, from 1977 until 2003. In May 2000, a former Richland County employee, Jewel Jones-Van Tassel ("Jones-Van Tassel"), filed an amended complaint against Richland County and others in the District of North Dakota alleging claims including gender discrimination in violation of Title VII of the Civil Rights Act.¹ In that litigation, Myers gave deposition testimony that was favorable to Jones-Van Tassel concerning his knowledge of the behavior of Richland County Sheriff Harlan Muehler and Richland County Commissioner Dave Paulson toward female employees of Richland County. The parties settled the case, and Jones-Van Tassel received $1.2 million. The defendant-signatories of the Jones-Van Tassel settlement agreement who are also defendants in the present action include Richland County and former Richland County Commissioners Ray Ward, Dave Paulson, Merlin Berg and Steve Campbell. Paragraph six of the settlement agreement, the "no-retaliation provision," provides:

6. No Retaliation. Defendants agree that they will not retaliate with respect to any employment related matter against any former, present, or prospective City or County employee, or individual whose compensation is paid, in whole or in part, by the City or County, who have provided any support to Plaintiff, whether by affidavit, deposition testimony, providing information to Plaintiff, or any other manner of support.

Furthermore, paragraph 17 of the settlement agreement provides, "The parties agree that the Federal District Court for the District of North Dakota shall retain jurisdiction of this matter to enforce the terms of this Settlement Agreement and Release." The district court expressly retained jurisdiction to enforce the settlement agreement in its January 10, 2001, Order for Dismissal with Prejudice and Retaining Jurisdiction with the statement that "this Court shall retain jurisdiction of this matter to enforce the terms of the Settlement Agreement and Mutual Releases."

On November 12, 2002, Myers instituted the present action against Richland County and current and former members of the Richland County Board of Commissioners in their individual and official capacities. Myers brought three claims. The first was a breach of contract claim against Richland County.² He asserted that Richland County breached the Jones-Van Tassel settlement agreement by retaliating against him for his deposition testimony and that the retaliation resulted in his defeat in the November 2002 election for State's Attorney. He also brought claims for IIED and defamation against present Richland County Commissioners Bryan L Flaa, Don Holen, Lynn C. Larsen, Tim Campbell and Joel Dotzenrod, in their individual capacities, and former Richland County Commissioners Ray Ward, Steve Campbell, Merlin Berg and Dave Paulson, in their individual capacities.

The defendants moved to dismiss the action. The district court denied the defendants' motion to dismiss on October 23, 2003, rejecting the arguments that it lacked subject matter jurisdiction, that Myers lacked standing to enforce the settlement agreement and that Myers failed to state a claim upon which relief could be granted. The district court later amended its order so as to dismiss the defendants who were not signatories to the Jones-Van Tassel settlement agreement-Bryan L. Flaa, Don Holen, Lynn C. Larsen, Tim Campbell and Joel Dotzenrod. Next, the parties stipulated that Steve Campbell and Merlin Berg be dismissed from the suit. The remaining defendants, Richland County, Ray Ward and Dave Paulson, moved for summary judgment. On September 30, 2004, the district court granted the motion for summary judgment as to Myers's remaining claims for breach of settlement agreement against Richland County, and for IIED and defamation against Ray Ward and Dave Paulson. Myers appeals.

II. DISCUSSION

A. Subject Matter Jurisdiction

We first must address the defendants' argument that this action should be dismissed for lack of subject matter jurisdiction because "[a]ny party or the court may, at any time, raise the issue of subject matter jurisdiction." GMAC Commercial Credit LLC v. Dillard Dept. Stores, Inc., 357 F.3d 827, 828 (8th Cir.2004). We review the question of subject matter jurisdiction de novo. Gilbert v. Monsanto Co., 216 F.3d 695, 699 (8th Cir.2000).

The district court found that the breach of contract claim, as well as the IIED and defamation claims, fell within supplemental jurisdiction under 28 U.S.C. § 1367(a), and rejected the defendants' request that the district court exercise its discretion to decline jurisdiction based on the factors listed in 28 U.S.C. § 1367(c). We hold that because the district court expressly retained jurisdiction to enforce the Jones-Van Tassel settlement agreement, it had ancillary enforcement jurisdiction over the breach of contract claim. We also hold, however, that the district court lacked supplemental jurisdiction pursuant to § 1367(a) over the IIED and defamation claims because it did not possess original jurisdiction over the action, as required by § 1367(a).

1. Breach of Contract

"Federal courts are courts of limited jurisdiction." Kokkonen v. Guardian Life Insurance Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). The Supreme Court held in Kokkonen that district courts do not have inherent power to enforce a settlement agreement entered into by parties in federal court. 511 U.S. at 380-81, 114 S.Ct. 1673. Because an action to enforce a settlement agreement is a claim for breach of contract, it should be heard in state court unless it has "its own basis for jurisdiction." Id. at 378, 114 S.Ct. 1673. While the Court found no basis for jurisdiction where the district court's order did not even mention the settlement agreement, the Court explained that

if the parties' obligation to comply with the terms of the settlement agreement had been made part of the order of dismissal-either by separate provision (such as a provision "retaining jurisdiction" over the settlement agreement) or by incorporating the terms of the settlement agreement in the order.... a breach of the agreement would be a violation of the order, and ancillary jurisdiction to enforce the agreement would therefore exist.

511 U.S. at 381, 114 S.Ct. 1673; see also Adduono v. World Hockey Ass'n, 824 F.2d 617, 621-22 (8th Cir.1987) (holding that the district court lacked jurisdiction where it did not incorporate the settlement agreement into the dismissal order or expressly retain jurisdiction to enforce the settlement agreement).

Kokkonen distinguished two "heads" of "ancillary jurisdiction (in the very broad sense in which that term is sometimes used)," explaining that the Court has asserted it "for two separate, though sometimes related, purposes: (1) to permit disposition by a single court of claims that are, in varying respects and degrees, factually interdependent; and (2) to enable a court to function successfully, that is, to manage its proceedings, vindicate its authority, and effectuate its decrees." 511 U.S. at 379-80, 114 S.Ct. 1673 (citations omitted). The exercise of jurisdiction to enforce a settlement agreement serves the latter role. Id. at 380-81, 114 S.Ct. 1673. This "ancillary enforcement jurisdiction" is distinct from the type of ancillary jurisdiction exercised pursuant to 28 U.S.C. § 1367.³ Section 1367 "combines the doctrines of pendent and ancillary jurisdiction under a common heading" of supplemental jurisdiction. City of Chicago v. Int'l College of Surgeons, 522 U.S. 156, 165, 118 S.Ct. 523, 139 L.Ed.2d 525 (1997). It provides in part that "in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution." 28 U.S.C. § 1367(a). Claims within the action are part of the same case or controversy if they "derive from a common nucleus of operative fact." City of Chicago, 522 U.S. at 165, 118 S.Ct. 523 (quoting United Mine Workers v. Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966)).

The existence of ancillary enforcement jurisdiction apart from the supplemental jurisdiction embodied by § 1367 is evidenced by Kokkonen's caveat that its use of the term "ancillary jurisdiction" was in a "very broad sense" and by its lack of reliance on § 1367.⁴ 511 U.S. at 379-80, 114 S.Ct. 1673. Furthermore, the distinction is...