Cement Antitrust Litigation (MDL No. 296), In re

• Decision Date: 30 October 1981
• Docket Number: Nos. 81-5481,81-7465 and 81-8079,s. 81-5481
• Citation: 673 F.2d 1020
• Parties: , 1982-1 Trade Cases 64,515 In re CEMENT ANTITRUST LITIGATION (MDL NO. 296). STATE OF ARIZONA, et al., Plaintiffs-Appellants, v. IDEAL BASIC INDUSTRIES, et al., Defendants-Appellees. STATE OF ARIZONA, et al., Petitioners, v. UNITED STATES DISTRICT COURT FOR the DISTRICT OF ARIZONA, Respondent, and Kaiser Cement and Gypsum Corporation, et al., Real Parties in Interest. STATE OF ARIZONA, et al., Petitioners, v. ASH GROVE CEMENT COMPANY, et al., Respondents. . Order filed
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1020

673 F.2d 1020

64 A.L.R.Fed. 415, 1982-1 Trade Cases 64,515

In re CEMENT ANTITRUST LITIGATION (MDL NO. 296).

STATE OF ARIZONA, et al., Plaintiffs-Appellants, v. IDEAL BASIC INDUSTRIES, et al., Defendants-Appellees.

STATE OF ARIZONA, et al., Petitioners, v. UNITED STATES DISTRICT COURT FOR the DISTRICT OF ARIZONA, Respondent, and Kaiser Cement and Gypsum Corporation, et al., Real Parties

in Interest.

STATE OF ARIZONA, et al., Petitioners, v. ASH GROVE CEMENT COMPANY, et al., Respondents.

Nos. 81-5481, 81-7465 and 81-8079.

United States Court of Appeals, Ninth Circuit.

Order filed Oct. 30, 1981.

Opinion filed Jan. 27, 1982.

As Amended on Denial of Rehearing and Rehearing En Banc

April 15, 1982.

Before WALLACE, SKOPIL, and BOOCHEVER, Circuit Judges.

WALLACE, Circuit Judge:

Plaintiffs, appellants and petitioners herein, seek review of the district court's order of May 26, 1981, granting a motion to recuse brought by defendants, appellees and real parties herein. Three avenues are attempted: a direct appeal under 28 U.S.C. § 1291, a discretionary interlocutory appeal pursuant to 28 U.S.C. § 1292(b), and a petition for a writ of mandamus. Defendants move to dismiss the appeal on the ground that a grant of a motion to recuse is not a final appealable order subject to review under 28 U.S.C. § 1291, and argue that an interlocutory appeal under section 1292(b) is not warranted. We dismiss the appeal for lack of jurisdiction and deny the petition for permission to appeal pursuant to section 1292(b). Review will be based upon the petition for mandamus.

I

Plaintiffs, a national class of public and private purchasers of cement and cement-containing products, and two statewide classes of governmental purchasers, assert a nationwide conspiracy among various cement producers to fix, maintain and stabilize the price of cement and cement products in violation of, inter alia, Section 1 of the Sherman Act, 15 U.S.C. § 1. The original suit was filed in the District of Arizona in 1976. Similar actions, which were filed in other parts of the country, were thereafter transferred by the Judicial Panel on Multi-District Litigation to the District of Arizona for consolidated pretrial proceedings. Because of his experience with the pretrial proceedings that had already been conducted in the actions pending in the District of Arizona, Judge Muecke was assigned to hear the coordinated or consolidated pretrial proceedings. In re Cement and Concrete Antitrust Litigation, 437 F.Supp. 750, 753 (Jud.Pan.Mult.Lit.1977).

On March 9, 1979, Judge Muecke certified that the litigation proceed on behalf of a nationwide class of public and private cement purchasers and two statewide governmental entity classes. Following certification of these classes, the parties lodged with the court a Master Class List of 210,235 entities, consisting of all putative class members who could be ascertained through reasonable efforts. On January 12, 1981, after Judge Muecke had approved the list and had given notice to the putative class members, pursuant to Fed.R.Civ.P. 23(c)(2), that they could elect exclusion from the class by written request prior to December 31, 1980, defendants informed Judge Muecke in a letter that a comparison of his 1980 financial disclosure statement with the Master Class List indicated that his wife owned stock in seven of the 210,235 entities, none of which had requested exclusion. Defendants asserted that such stock ownership constituted interests both in parties to the litigation and in the subject matter of the litigation, thereby mandating Judge Muecke's recusal under 28 U.S.C. § 455(b)(4). ¹ On February 23, 1981, defendants filed a motion for Judge Muecke's disqualification on the grounds asserted in their previous letter. Judge Muecke granted defendants' motion to recuse on the basis that his wife's stock ownership fell within the per se rule of 28 U.S.C. § 455(b)(4), which requires recusal when a judge's spouse has a financial interest in a party to the proceeding. In re Cement and Concrete Antitrust Litigation, 515 F.Supp. 1076 (D.Ariz.1981). ² On June 3, 1981, Judge Muecke certified his order for an interlocutory appeal pursuant to 28 U.S.C. § 1292(b).

II

The first question we must decide is whether a party may take an appeal, pursuant to 28 U.S.C. § 1291, from an order granting a motion to recuse. Under section 1291, the courts of appeals are vested with "jurisdiction of appeals from all final decisions of the district courts...." The Supreme Court has consistently interpreted this language as indicating that a party may not take an appeal under this section until there has been a decision by the district court that "ends the litigation on the merits and leaves nothing for the court to do but execute the judgment." Coopers & Lybrand v. Livesay, 437 U.S. 463, 467, 98 S.Ct. 2454, 2457, 57 L.Ed.2d 351 (1978) (Coopers & Lybrand ), quoting Catlin v. United States, 324 U.S. 229, 233, 65 S.Ct. 631, 633, 89 L.Ed. 911 (1945). An order granting a motion to recuse clearly does not terminate the entire litigation. ³ "Such an order is appealable, therefore, only if it comes within an appropriate exception to the final-judgment rule." Coopers & Lybrand, supra, 437 U.S. at 467, 98 S.Ct. at 2457. In this case, plaintiffs rely on the "collateral order" exception articulated by the Supreme Court in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949) (Cohen).

In Cohen the Supreme Court recognized that some orders by their nature require review at an earlier stage, because they will be effectively unreviewable upon appeal from a final judgment. Id. at 546, 69 S.Ct. at 1225. The Cohen collateral order doctrine allows appeals from orders that can be said to fall within

that small class which finally determine claims of rights separable from, and collateral to, rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated.

Id. Although there is a strong policy behind the rule that appeals are to be made only following final judgment on the merits, the Court has recognized that under certain circumstances "a rigid insistence on technical finality would sometimes conflict with the purposes of the statute." Coopers & Lybrand, supra, 437 U.S. at 471, 98 S.Ct. at 2459. Recently, the Court summarized the Cohen standard in the following manner:

"(T)he 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."

Firestone Tire & Rubber Co. v. Risjord, 449 U.S. 368, 375, 101 S.Ct. 669, 674, 66 L.Ed.2d 571 (1981), quoting Coopers & Lybrand, supra, 437 U.S. at 468, 98 S.Ct. at 2457.

Firestone also stressed that the Cohen exception is narrow and teaches that "interlocutory orders are not appealable 'on the mere ground that they may be erroneous.' " 449 U.S. at 378, 101 S.Ct. at 675. Thus, in determining whether a district court's order granting a motion to recuse is appealable prior to final judgment, we must be aware not only of the practical effect of denying immediate review upon a particular party, but also of the potential "unjustified waste of scarce judicial resources" which can result if the limited exception carved out in Cohen is transformed "into a license for broad disregard of the finality rule imposed by Congress in § 1291." Id. at 378, 101 S.Ct. at 676.

Plaintiffs argue that an order granting recusal is appealable under Cohen. Applying the standard as summarized by the Court in Firestone, id. at 375, 101 S.Ct. at 674, we cannot disagree that an order granting recusal conclusively determines a disputed question, completely separate from the merits of the action, which, if not reviewed immediately, will be effectively unreviewable on appeal from final judgment. Cf. In re Coordinated Pretrial Proceedings in Petroleum Products Antitrust Litigation, 658 F.2d 1355 (9th Cir. 1981) (allowing appeal from order disqualifying counsel under Cohen). However, not all orders which meet the requirements of this standard are reviewable under section 1291. The Court in Cohen spoke of that small class of orders which finally determine "claims of right." More recently the Court has explained that in the situations in which Cohen has been applied, "each involved an asserted right the legal and practical value of which could be destroyed if it were not vindicated before trial." United States v. MacDonald, 435 U.S. 850, 860, 98 S.Ct. 1547, 1552, 56 L.Ed.2d 18 (1978) (footnote omitted). Thus, criminal defendants have been permitted appeals prior to criminal trials when they claim a violation of the double jeopardy clause, Abney v. United States, 431 U.S. 651, 662, 97 S.Ct. 2034, 2041, 52 L.Ed.2d 651 (1977), or a violation of their statutory and constitutional right to bail, Stack v. Boyle, 342 U.S. 1, 6, 72 S.Ct. 1, 4, 96 L.Ed. 3 (1951). In these situations, like the posting of security for costs involved in Cohen, the party seeking immediate review can establish not only that the district court's order is effectively unreviewable on appeal, but also that the effect of an erroneous decision by the district court will deprive him of some protectable interest. See Firestone Tire & Rubber Co. v. Risjord, supra, 449 U.S. at 376-77, 101 S.Ct. at 674-675. The rights sought to be vindicated by an immediate appeal would be extinguished by the time a final judgment is entered. Since the Supreme Court has recently cautioned that the final judgment rule and the important policies which support it must not be eroded by an unnecessarily liberal application of the Cohen exception, we are convinced that the "claim of right" language used in Cohen and reiterated by the Court on subsequent occasions must be viewed as establishing a mandatory prerequisite...