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

Decision Date01 October 1982
Docket NumberNo. 81-7465,81-7465
Citation688 F.2d 1297
Parties1982-2 Trade Cases 64,973 In re CEMENT ANTITRUST LITIGATION (MDL NO. 296). STATE OF ARIZONA, et al., Petitioners, v. UNITED STATES DISTRICT COURT For the DISTRICT OF ARIZONA, Respondent, Kaiser Cement & Gypsum Corporation, et al., Real Parties in Interest.
CourtU.S. Court of Appeals — Ninth Circuit

Josef D. Cooper, Frederick P. Furth, San Francisco, Cal., argued, for petitioners; Kenneth R. Reed, Phoenix, Ariz., Tracy R. Kirkham, Kirk A. McKinney, Cooper, Kirkham, Hainline & McKinney, P.C., Daniel S. Mason, Matthew A. Joseph, San Francisco, Cal., Peter K. Shack, Michael R. Granen, Deputy Attys. Gen., George Deukmejian, Atty. Gen., Robert H. Philibosian, Sanford N. Gruskin, Chief Asst. Attys. Gen., Las Angeles, on brief.

David Bonderman, Washington, D.C., argued, for respondent; Jacqueline R. Denning, Richard C. Lowery, Washington, D.C., William J. Maledon, Phoenix, Ariz.,

On Petition for Writ of Mandamus United States District Court for the District of Arizona.

Before FERGUSON, NELSON and REINHARDT, Circuit Judges.

REINHARDT, Circuit Judge.

Plaintiffs seek a writ of mandamus directing the district court to vacate its opinion and order in which Judge Muecke granted the defendants' motion to recuse himself pursuant to 28 U.S.C. § 455(b)(4) (1976). In re Cement and Concrete Antitrust Litigation, 515 F.Supp. 1076 (D.Ariz.1981). Petitioners request that we issue the writ pursuant to our supervisory authority under the All Writs Act, 28 U.S.C. § 1651 (1976). We have previously dismissed plaintiffs' appeal from Judge Muecke's order for lack of jurisdiction under 28 U.S.C. § 1291 (1976) and have denied plaintiffs' petition for permission to appeal pursuant to 28 U.S.C. § 1292(b) (1976). In re Cement Antitrust Litigation, 673 F.2d 1020 (9th Cir. 1982). In our opinion we concluded, however, that the petition for a writ of mandamus would be reviewed on the merits. Id. at 1025. We now do so under our supervisory authority to insure the proper and orderly administration of the federal judicial system. See Schlagenhauf v. Holder, 379 U.S. 104, 85 S.Ct. 234, 13 L.Ed.2d 152 (1964); La Buy v. Howes Leather Co., 352 U.S. 249, 77 S.Ct. 309, 1 L.Ed.2d 290 (1957). 1

I. History of Proceedings

Beginning in 1976, twenty-one separate actions were filed in federal district courts in Arizona and California alleging a conspiracy among various cement and concrete producers to fix the price of cement and concrete in violation of the antitrust laws. On September 12, 1977, the Judicial Panel on Multi-District Litigation transferred those actions to the Central District of Arizona and assigned the cases to the Honorable C. A. Muecke for coordinated or consolidated pretrial procedures. In re Cement and Concrete Antitrust Litigation, 437 F.Supp. 750 (Jud. Pan. Mult. Lit. 1977). The Panel on Multi-District Litigation cited Judge Muecke's familiarity with the litigation as one of the reasons for transferring the case to the District of Arizona. Id. at 753.

Early in 1979, Judge Muecke certified a nationwide class of public and private cement producers and two statewide governmental entity classes. The parties lodged with the court a master class list that contained the names of 210,235 putative class members who could be identified with reasonable effort. Judge Muecke actively presided over the pretrial proceedings through January of 1981, during which time he entered over 75 pretrial orders, ruled on countless motions, supervised the substantial completion of the discovery process, approved the master class list, and gave notice to class members that they could opt out of the class by written request prior to December 31, 1980.

On January 12, 1981, several of the defendants advised Judge Muecke by letter that a comparison of his 1980 financial disclosure report with the names on the master class list revealed that Judge Muecke's wife owned stock in seven of the 210,235 class members. The defendants asserted that the judge was under a per se obligation to recuse himself pursuant to 28 U.S.C. § 455(b)(4) and Canon 3(C)(1)(c) of the Code of Judicial Conduct. Judge Muecke ordered the parties to brief the question and heard oral argument on two occasions.

Judge Muecke also requested an advisory opinion from the Advisory Committee on Codes of Conduct of the Judicial Conference of the United States. The Committee responded by suggesting that Judge Muecke should disqualify himself because (1) his wife had a financial interest in the subject matter of the proceeding within the meaning of section 455, (2) his wife's interests could be substantially affected by the outcome of the proceeding within the meaning of Canon 3 of the Code of Judicial Conduct, and (3) his continued handling of the case could create the appearance of impropriety in violation of Canon 2 of the Code of Judicial Conduct. 515 F.Supp. at 1083-84. See also Advisory Comm. on Judicial Activities, Disqualification in Class Actions, Advisory Op. 68 (1981).

Judge Muecke recused himself in an opinion and order, 515 F.Supp. at 1076. The judge did not reach the issue of whether he had a financial interest in the "subject matter" of the proceeding, but rather, based his order of recusal on his conclusion that his wife's stock constituted a financial interest in a "party" to the proceeding within the meaning of 28 U.S.C. § 455(b)(4) (1976). In his opinion and order of recusal, Judge Muecke made it clear that the sole reason he disqualified himself was because he believed that section 455 imposed a per se rule of recusal in such circumstances:

I must admit that my first reaction to (respondents') position recalled the words of Mr. Bumble in Dicken's Oliver Twist: "If the law supposes that ... the law is an ass-an idiot."

... I have concluded (,however,) that I must recuse myself, not because I feel a sense of conflict, and not because I feel that to continue would create the appearance of impropriety. I have concluded that I must recuse myself for the sole reason that the law, as written, says I must.

515 F.Supp. at 1078 (footnote omitted). Judge Muecke further indicated that he was willing and able to continue handling the multidistrict proceeding and that he would have done so were it not for section 455. Id. at 1081. Judge Muecke certified his order of recusal for an interlocutory appeal pursuant to 28 U.S.C. § 1292(b) (1976).

Plaintiffs have sought review of Judge Muecke's recusal order through three avenues: (1) an appeal pursuant to 28 U.S.C. § 1291; (2) a petition for permission to appeal pursuant to 28 U.S.C. § 1292(b); and (3) a petition for a writ of mandamus requesting this court to exercise its supervisory authority over the district courts pursuant to 28 U.S.C. § 1651. Although we dismissed the appeal under section 1291 and denied permission to appeal under section 1292(b), we noted that where a party claims exceptional circumstances, such as major disruption of the litigation resulting from an order of recusal, the party may seek a writ of mandamus in the court of appeals. In deciding to review the petition on the merits, we said, "(i)t is for just such an exceptional circumstance that the writ was designed." 673 F.2d at 1025.

II. Bauman Revisited
A. Introduction

In reviewing petitioners' request for a writ of mandamus, we are guided by the principles collected and distilled in Bauman v. United States District Court, 557 F.2d 650 (9th Cir. 1977). In Bauman, we expressed our concern over the unprincipled use of the writ as a means of wresting control of litigation from the district courts merely because appellate judges disagree with interlocutory rulings of the district courts or are sympathetic to arguments made in support of petitions. Such unrestrained use of mandamus would undermine the mutual respect that is an indispensable element of the relationship between federal trial and appellate courts and would "subvert the policies underlying the finality rule, 28 U.S.C. § 1291, or the carefully limited congressional scheme governing interlocutory appeals ...." Id. at 653.

In order to confine the use of mandamus to its proper office, we enunciated five general guidelines in Bauman to assist in the determination of whether mandamus is the appropriate remedy in a particular case. The guidelines are: (1) whether the party seeking the writ has no other adequate means, such as direct appeal, to attain the relief he desires; (2) whether the petitioner will be damaged or prejudiced in a way that is not correctable on appeal; (3) whether the district court's order is clearly erroneous as a matter of law; (4) whether the district court's order is an oft repeated error or manifests persistent disregard for the federal rules; and (5) whether the district court's order raises new and important problems or issues of law of first impression. Id. at 654-55. Related considerations include: whether the injury alleged by petitioners, although not correctable on appeal, is the kind that justifies invocation of our mandamus authority; whether the petition presents an issue of law which may repeatedly evade appellate review; and whether there are other compelling factors relating to the efficient and orderly administration of the district courts.

As we noted in Bauman, the guidelines are cumulative and may not all point to the same conclusion. Id. at 655. Moreover, all of the guidelines are unlikely to be met in any one case. Some are more relevant to particular categories of cases than others. Certain concepts relating to the traditional use of mandamus are not necessarily applicable in supervisory mandamus cases, or, at the least, are applied differently. The guidelines are not susceptible of mechanical application; they are not meant to supplant reasoned and independent analysis by appellate courts. In sum, the guidelines serve only as a useful starting point, an analytic...

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