Samake v. Thunder Lube, Inc.
| Decision Date | 27 January 2022 |
| Docket Number | August term 2021,No. 21-102-cv,21-102-cv |
| Citation | 24 F.4th 804 |
| Parties | Sekouba SAMAKE, Plaintiff-Appellant, v. THUNDER LUBE, INC., Abko Associates, Inc. and Dror Hershowitz, Defendants-Appellees. |
| Court | U.S. Court of Appeals — Second Circuit |
ABDUL K. HASSAN, Abdul Hassan Law Group, PLLC, Queens Village, NY, for Plaintiff-Appellant.
MICHAEL BRUK, Law Office of Michael Bruk, New York, NY, for Defendants-Appellees.
Before: JACOBS, MENASHI, Circuit Judges, LIMAN, District Judge.1
Plaintiff Sekouba Samake filed this suit against his former employer for alleged violations of the Fair Labor Standards Act and other laws. After the employer moved to compel arbitration, Samake filed a notice of voluntary dismissal without prejudice pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(i). The next day, the district court entered an order retaining jurisdiction over the case pursuant to Cheeks v. Freeport Pancake House, Inc., 796 F.3d 199 (2d Cir. 2015), pending confirmation that the parties had not reached any settlement that would necessitate review.
In response, Samake filed a letter disclaiming a settlement but asserting that the case must continue in federal court. The court interpreted the letter as a request to withdraw the notice of dismissal, and ordered the parties to determine a briefing schedule for the pending motion to compel arbitration. The parties fully briefed the motion to compel arbitration, which the district court granted.
In Cheeks, this Court held that any Fair Labor Standards Act ("FLSA") settlement must be reviewed by the district court for compliance with that Act before the parties may dismiss a case with prejudice by joint stipulation pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii). See Cheeks, 796 F.3d at 206–207. The Court acknowledged that a stipulated dismissal is typically effective automatically under Rule 41(a)(1)(A)(ii), but cited the exception for an "applicable federal statute," Rule 41(a)(1)(A), and ruled that the FLSA is such a statute. Id. at 206.
We hold that the FLSA limits the automatic operation of Rule 41(a)(1)(A)(i), which concerns unilateral dismissals, as well as (ii), which concerns stipulated dismissals. Accordingly, the district court properly retained jurisdiction to inquire whether the parties had reached a settlement necessitating Cheeks review. Further, we conclude that the district court reasonably interpreted Samake's letter--filed while the district court retained jurisdiction--as a request to withdraw his unilateral dismissal, which it then in its discretion deemed withdrawn.
As a result, the withdrawal of Samake's notice of dismissal was effected on June 25, 2019. Since Samake failed to appeal it within the 30 days required under Federal Rule of Appellate Procedure 4(a)(1)(A), we lack jurisdiction to review it. The order to compel arbitration, entered on December 22, 2020, was appealed within 30 days; but it is an unappealable interlocutory order. See 9 U.S.C. § 16(b). Since that is the only order that is presented to us, we dismiss this appeal for lack of appellate jurisdiction.
The facts that bear upon this appeal are procedural. On February 24, 2019, Plaintiff Sekouba Samake filed suit seeking unpaid overtime wages from his former employer, Thunder Lube, Inc. and others ("Thunder Lube") under the FLSA and other statutes. On May 16, 2019, Thunder Lube moved to compel arbitration. In response, on June 17, 2019, Samake filed a unilateral notice of voluntary dismissal without prejudice under Federal Rule of Civil Procedure 41(a)(1)(A)(i).
The next day, the district court entered a docket order (the "June 18 Order") reserving decision on whether to so-order the voluntary dismissal. The district court explained that, if the parties had reached a settlement, it was subject to court review and approval in order to ensure compliance with the FLSA pursuant to Cheeks v. Freeport Pancake House, Inc., 796 F.3d 199 (2d Cir. 2015). The June 18 Order cited two district court decisions discussing Cheeks review: Gallardo v. PS Chicken Inc., 285 F. Supp. 3d 549 (E.D.N.Y. 2018), in which the parties "filed [a] stipulation of dismissal without prejudice in apparent effort to evade judicial review"; and Carson v. Team Brown Consulting, Inc., 416 F. Supp. 3d 137 (E.D.N.Y. 2017), which "discuss[ed] potential preclusive effect of a dismissal without prejudice in light of overbroad release provisions and the applicable statute of limitations." Joint App'x 3 (internal quotation marks omitted). Although Samake had "implie[d] that no settlement ha[d] been reached,"2 the district court requested he "file a further letter on ECF, by June 24, 2019, stating whether the parties have reached a settlement, and, if so, whether they intend to file a motion for settlement approval" under Cheeks. Id.
Samake filed a letter as instructed, which advised that "there is no settlement of this action," but, addressing the concern expressed in Carson, went on to argue that the validity of the arbitration agreement must be reviewed because it may have "preclusive effect" on refiling his claims. Joint App'x 26–27. Accordingly, Samake concluded, "this case must continue in this Court." Id.
On June 25, 2019, the district court entered another docket order (the "June 25 Order"), stating that "[i]n light of [Samake's] letter[ ] withdrawing the voluntary dismissal," the parties should inform the court whether and when they would continue briefing the pending motion to compel arbitration. Joint App'x 3. The parties conferred, and Samake submitted a letter stating that "Defendants are moving forward with their motion to compel arbitration." Joint App'x 28. The parties completed briefing as scheduled.
On December 22, 2020, the district court granted Thunder Lube's motion to compel arbitration. See Samake v. Thunder Lube Inc., No. 19-cv-01094, 2020 WL 11039197, at *1 (E.D.N.Y. Dec. 22, 2020). The district court rejected Samake's argument that the obligation to arbitrate was ambiguous, id. at *2 ; Samake's remaining arguments--that specific provisions conflicted with the FLSA--were left to the arbitrator: "Once a court finds that an agreement exists and governs the controversy at issue, the validity and meaning of specific provisions within the Agreement to arbitrate is a matter for the arbitrator to decide." Id. at *4 (internal quotation marks omitted).
Finally, the district court turned to the "entirely separate issue" raised by Samake "that should the Court find, as it has, his claims arbitrable, it should grant and order his earlier motion for voluntary dismissal rather than compel arbitration." Id. The district court rejected this argument because "Samake subsequently withdrew" his motion for voluntary dismissal. Id.
Samake filed a timely notice of appeal of that December 22 order. On appeal, Samake argues that either the arbitration agreement is invalid or that the district court was divested of jurisdiction to consider arbitrability because his notice of dismissal terminated the action on June 17.
Before we address the timeliness of Samake's appeal, we first consider whether the district court properly retained jurisdiction following Samake's notice of dismissal, and whether the district court properly deemed that notice of dismissal withdrawn, questions that bear upon our appellate jurisdiction for two reasons. See Jacobs v. Patent Enf't Fund, Inc., 230 F.3d 565, 567 (2d Cir. 2000) ().
First , Samake challenges the district court's jurisdiction to continue proceedings--and enter an order compelling arbitration--following his notice of voluntary dismissal. As this Court has observed in similar cases, "if the lower court had altogether lost jurisdiction over the action when the order was entered, an appeal from it will not be dismissed, but will be decided on the merits." Littman v. Bache & Co., 246 F.2d 490, 492 (2d Cir. 1957) (Hand, J. ). "[U]nder the Littman formula, the question of our jurisdiction is thus dependent on our determination of the validity of the district court's action, [so] we must of course assert jurisdiction in order to make that determination." Thorp v. Scarne, 599 F.2d 1169, 1172 (2d Cir. 1979) ; see also Radack v. Norwegian Am. Line Agency, Inc., 318 F.2d 538, 543 n.5 (2d Cir. 1963) (). If Samake's notice of dismissal terminated the district court's jurisdiction, we have appellate jurisdiction to review the order to compel arbitration. That line of cases refutes the jurisdictional argument of the concurring opinion.
Second , Samake argues that his appeal is timely because the notice of dismissal was not deemed withdrawn until the order to compel arbitration. Accordingly, if the notice of dismissal properly was deemed withdrawn, we must determine when the order was entered in order to decide whether the appeal from that order is timely.
"The applicability of Rule 41(a)(1)(A)(i) to the plaintiff's claim is a legal question which we review de novo." Youssef v. Tishman Constr. Corp., 744 F.3d 821, 824 (2d Cir. 2014) (internal quotation marks omitted). We conclude that, notwithstanding Samake's Rule 41(a)(1)(A)(i) voluntary dismissal without prejudice, the district court properly retained limited jurisdiction to conduct a Cheeks review.
Federal Rule of Civil Procedure 41(a)(1)(A) allows voluntary dismissal of a case (i) by a notice of dismissal filed by plaintiff prior to answer or motion for summary judgment, or (ii) by a stipulation of dismissal signed by all parties. Subject to "any applicable federal statute," Fed. R. Civ. P. 41(a)(1)(A), dismissal under...
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