K.C. v. Torlakson

• Decision Date: 11 August 2014
• Docket Number: No. 12–16178.,12–16178.
• Citation: 762 F.3d 963
• Parties: K.C., by and through ERICA C., her guardian; A.A., by and through Stacey A., her guardian; M.C., by and through Laurie C., her guardian; K.F., by and through Sheree F., her guardian; American Diabetes Association, Plaintiffs–Appellants, v. Tom TORLAKSON, in his official capacity as Superintendent of Public Instruction for the State of California, Defendant–Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

762 F.3d 963

K.C., by and through ERICA C., her guardian; A.A., by and through Stacey A., her guardian; M.C., by and through Laurie C., her guardian; K.F., by and through Sheree F., her guardian; American Diabetes Association, Plaintiffs–Appellants,

v.Tom TORLAKSON, in his official capacity as Superintendent of Public Instruction for the State of California, Defendant–Appellee.

No. 12–16178.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted April 10, 2014.

Filed Aug. 11, 2014.

Donna Brorby (argued), Law Office of Donna Brorby, San Francisco, CA; Arlene B. Mayerson, Larisa M. Cummings and Charlotte L. Lanvers, Disability Rights Education and Defense Fund, Inc., Berkeley, CA, for Plaintiffs–Appellants.

Paul E. Lacy (argued), Deputy General Counsel, Amy Bisson Holloway, General Counsel, Edmundo Aguilar, Assistant General Counsel, and Ava C. Yajima, Deputy General Counsel, California Department of Education, Sacramento, CA, for Defendants–Appellees.

Appeal from the United States District Court for the Northern District of California, Maxine M. Chesney, Senior District Judge, Presiding. D.C. No. 3:05–cv–04077–MMC.

Before: JOHN T. NOONAN, JACQUELINE H. NGUYEN, and PAUL J. WATFORD, Circuit Judges.

OPINION

NGUYEN, Circuit Judge:

The common-law doctrine of ancillary jurisdiction over related claims, codified as part of a federal court's supplemental jurisdiction under 28 U.S.C. § 1367, is generally well understood. Yet, as the Supreme Court observed, the “doctrine of ancillary jurisdiction can hardly be criticized for being overly rigid or precise,” because the more obscure doctrine of ancillary jurisdiction over collateral proceedings remains a matter of case law. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 379, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994); see13 Charles Alan Wright et al., Federal Practice & Procedure § 3523 (3d ed.). The present appeal involves the latter—ancillary jurisdiction over proceedings related to, but technically separate from, a federal lawsuit. Under this doctrine, a federal court may exercise ancillary jurisdiction over collateral proceedings in two distinct contexts that are relevant here: to enforce a settlement agreement, and to resolve an attorney's fees dispute.

Four juvenile plaintiffs, by and through their respective guardians, and the American Diabetes Association (collectively, “Plaintiffs”) filed a putative class action against Jack O'Connell, in his official capacity as Superintendent of Public Instruction for the State of California,¹ the State Board of Education and the California Department of Education (collectively, “Defendants”). The parties eventually settled, and the district court retained limited jurisdiction to enforce their settlement agreement. After the court's jurisdiction to enforce the settlement agreement had expired under the terms of that agreement, Plaintiffs filed a motion seeking attorneys' fees for monitoring Defendants' compliance with the agreement. The district court denied the motion for lack of jurisdiction on the ground that its jurisdiction to enforce the settlement agreement had expired.

On appeal, Plaintiffs' argument is two-fold. First, they argue that their motion for attorneys' fees does not seek to enforce the settlement agreement. Consequently, the conclusion that the district court lacks ancillary jurisdiction to enforce the settlement agreement is irrelevant. Second, they argue that the district court independently has ancillary jurisdiction over a post judgment attorneys' fees dispute, irrespective of the fact that the court's jurisdiction to enforce the settlement agreement has expired. We agree. Therefore, we reverse and remand.

BACKGROUND

In October 2005, Plaintiffs filed a putative class action alleging that Defendants failed to provide necessary services for students with diabetes in California public schools. Plaintiffs alleged violations of the Americans with Disabilities Act (“ADA”), 42 U.S.C. § 12131 et seq.,Section 504 of the Rehabilitation Act of 1973 (“Section 504”), 29 U.S.C. § 794, and the Individuals with Disabilities Education Act (“IDEA”), 20 U.S.C. § 1400 et seq.

In July 2007, the parties entered into a settlement agreement, resolving Plaintiffs' claims (the “Settlement Agreement”). On August 8, 2007, “pursuant to the settlement agreement between the parties, the terms of which [we]re expressly incorporated [t]herein,” the district court entered an order of dismissal with prejudice. Under the Settlement Agreement, Plaintiffs' attorneys were awarded $400,000 in fees.²

Under paragraph 14 of the Settlement Agreement, the district court retained jurisdiction for two and one-half years from the effective date of the Settlement Agreement, “solely to rule on any motion filed pursuant either to Paragraph 1.b. or to Paragraph 10, of [the Settlement Agreement].” The district court found that the “effective date” of the Settlement Agreement was July 24, 2007.

On November 18, 2011, almost two years after the district court's jurisdiction to enforce the Settlement Agreement had expired, Plaintiffs filed a motion for an additional $288,627.41 in attorneys' fees, pursuant to the ADA, 42 U.S.C. § 12205, Section 504, 29 U.S.C. § 794a(b), and the IDEA, 20 U.S.C. § 1415(i)(3)(B), “for their work monitoring implementation of the settlement with the California Department of Education in this matter.”

On April 20, 2012, the district court denied Plaintiffs' motion for lack of jurisdiction. The court ruled that the Settlement Agreement limited the “time within which the Court may entertain a motion for such fees,” and that the time had expired. On May 15, 2012, Plaintiffs timely appealed.

JURISDICTION

The district court had jurisdiction pursuant to 28 U.S.C. § 1331. We have jurisdiction pursuant to 28 U.S.C. § 1291. Cf. Balla v. Idaho, 677 F.3d 910, 915 (9th Cir.2012) (“Periodic fee awards for monitoring compliance with a final judgment are appealable [under Section 1291] if the award disposes of the attorneys' fee issue for the work performed during the time period covered by the award.”).

STANDARDS OF REVIEW

“A district court's decision to deny attorney's fees is reviewed for an abuse of discretion.” United States v. One 1997 Toyota Land Cruiser, 248 F.3d 899, 903 (9th Cir.2001). “An abuse of discretion occurs if the district court based its decision on an erroneous legal conclusion or a clearly erroneous finding of fact.” Andrew v. Bowen, 837 F.2d 875, 877 (9th Cir.1988). “Any elements of legal analysis and statutory interpretation that figure in the district court's attorneys' fees decision are reviewed de novo.” Barrios v. Cal. Interscholastic Fed'n, 277 F.3d 1128, 1133 (9th Cir.2002). Here, “[t]he existence of subject matter jurisdiction is a question of law that we review de novo.” Marin Gen. Hosp. v. Modesto & Empire Traction Co., 581 F.3d 941, 944 (9th Cir.2009).

DISCUSSION

I

The “doctrine of ancillary jurisdiction ... recognizes federal courts' jurisdiction over some matters (otherwise beyond their competence) that are incidental to other matters properly before them.” Kokkonen, 511 U.S. at 378, 114 S.Ct. 1673. Broadly speaking, federal courts exercise ancillary jurisdiction “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.” Id. at 379–80, 114 S.Ct. 1673 (emphases added).

The first and well-known purpose—ancillary jurisdiction over factually interdependent claims—is codified as part of 28 U.S.C. § 1367. See Peacock v. Thomas, 516 U.S. 349, 354 n. 5, 116 S.Ct. 862, 133 L.Ed.2d 817 (1996) (“Congress codified much of the common-law doctrine of ancillary jurisdiction as part of ‘supplemental jurisdiction’ in 28 U.S.C. § 1367.”). That purpose, however, is not relevant here.

This case instead involves the second, less common purpose—ancillary jurisdiction over collateral proceedings. Nat'l City Mortgage Co. v. Stephen, 647 F.3d 78, 85 (3d Cir.2011) (“Ancillary jurisdiction is a common law doctrine that survived the codification of supplemental jurisdiction in 28 U.S.C. § 1367.”); see13 Charles Alan Wright et al., Federal Practice & Procedure § 3523.2 (3d ed.) (differentiating “supplemental jurisdiction over claims asserted in federal court” from “jurisdiction over related proceedings that are technically separate from the initial case that invoked federal subject matter jurisdiction” (emphasis in original)).

As the Tenth Circuit has explained, this less common exercise of non-statutory ancillary jurisdiction “rests on the premise that a federal court acquires jurisdiction of a case or controversy in its entirety. Incident to the disposition of the principal issues before it, a court may decide collateral matters necessary to render complete justice.” Jenkins v. Weinshienk, 670 F.2d 915, 918 (10th Cir.1982).

In particular, this appeal turns on the distinction between a court's ancillary jurisdiction to enforce a settlement agreement and its ancillary jurisdiction over collateral matters such as an attorney's fees dispute.

II

A

We first address a court's authority to enforce settlement agreements. Federal courts “have no inherent power to enforce settlement agreements entered into by parties litigating before them.” Arata v. Nu Skin Int'l, Inc., 96 F.3d 1265, 1268 (9th Cir.1996) (citing Kokkonen, 511 U.S. at 378, 114 S.Ct. 1673). Rather, courts have ancillary jurisdiction to enforce a settlement agreement only “if the parties' obligation to comply with the terms of the settlement agreement ha[s] 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.” Kokkonen, 511 U.S. at 381, ...