Swope v. Columbian Chemicals Co., 99-30216.

Citation281 F.3d 185
Decision Date24 January 2002
Docket NumberNo. 99-30216.,99-30216.
PartiesClaude SWOPE; Sandra K. Swope, Plaintiffs-Appellants, v. COLUMBIAN CHEMICALS CO.; et al., Defendants, Columbian Chemicals Co.; Henkel Corp.; Millennium Petrochemicals Inc., formerly known as National Distillers & Chemical Corp., also known as Quantum Chemicals Corp., Defendants-Appellees.
CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)

Lawrence Charles Billeaud (argued), Lafayette, LA, for Plaintiffs-Appellants.

James Berry St. John, Jr. (argued), Greg Lynn Johnson, Liskow & Lewis, New Orleans, LA, for Columbian Chemicals Co.

John C. Combe, Jr. (argued), Judith V. Windhorst, Jones, Walker, Waechter, Poitevent, Carrere & Denegre, New Orleans, LA, for Henkel Corp. and Millennium Petrochemicals, Inc.

Appeals from the United States District Court for the Western District of Louisiana.

Before JOLLY and DENNIS, Circuit Judges, and DOWD,* District Judge.

DENNIS, Circuit Judge, and DOWD, District Judge**:

Mr. Claude Swope and his wife brought this suit alleging that he was rendered totally and permanently disabled by lung damage caused through his inhalation of ozone during his employment as a maintenance worker by Columbian Chemicals Company ("Columbian"). Columbian is in the business of manufacturing carbon black with a process that involves the use of ozone. Columbian purchased and operated ozone generators manufactured by Emery Industries, Inc. ("Emery"). Henkel Corporation/Millennium Petrochemicals, Inc., ("Henkel") is Emery's successor corporation and subject to liability for harm to persons caused by Emery's defective products.

Under the Swopes' allegations of facts, Mr. Swope's lung damage resulted from hazardous characteristics of the Emery ozone generators which made them unreasonably dangerous in design and unreasonably dangerous for lack of an adequate warning of those hazards. The Swopes allege that Columbian knew to a substantial certainty that its continual exposures of Mr. Swope to harmful amounts of ozone without providing him with any respiratory protection would cause repeated damage to his lungs. Accordingly, the Swopes sued for damages against Henkel under allegations raising products liability theories and against Columbian for intentional torts or batteries. The district court granted motions for summary judgment by Columbian and Henkel rejecting all of the Swopes' claims, except that their products liability claim for design defect was dismissed voluntarily without prejudice to its refiling in the event of reversal of the summary judgment in favor of Henkel on appeal.

The questions raised by the Swopes' appeal from the district court's summary judgments against them are: (1) Does this court have appellate jurisdiction? (2) If so, can the Swopes' tort action against Columbian survive a motion for summary judgment because of a genuine dispute as to whether Columbian's intentional tort of battery caused Swope's lung damage? (3) Is the Swopes' products liability action against Henkel time-barred under Louisiana Revised Statute § 9:2772 because Emery, the manufacturer of the ozone generators, performed a "construction of an improvement to immovable property"? (4) If the Swopes' product liability action is not time barred under Louisiana Revised Statute § 9:2772, can it survive a motion for summary judgment because Henkel failed to carry its burden of showing that Columbian knew or reasonably should have been expected to know of the dangerous characteristic of the Emery generator that caused damage to Mr. Swope?

After reviewing the defendants' motions for summary judgment de novo, we reverse and remand the case for further proceedings.

I. JURISDICTION

On February 8, 1999, the district court entered an order granting summary judgment to, and dismissing all claims against, Columbian. On February 17, 1999, plaintiffs filed both a notice of appeal from the district court's February 8 ruling and a motion to designate the February 8 order in favor of Columbian as final under Federal Rule of Civil Procedure 54(b). On February 22, 1999, the trial court entered partial summary judgment in favor of defendant Henkel, and dismissed all claims against Henkel except for plaintiffs' claim for defective design. The same day, the district court denied the Swopes' Rule 54(b) motion to designate the court's February 8 ruling as final.

On April 23, 1999, plaintiffs filed a "Rule 41(a)" stipulated motion to dismiss the remaining claim against Henkel and a motion to designate both the February 8 and the February 22 orders granting summary judgment as final pursuant to Fed.R.Civ.P. 54(b). The plaintiffs also filed a second notice of appeal on both grants of summary judgment. The plaintiffs' stipulated motion to dismiss was qualified. The dismissal was to be with prejudice if the trial court's summary judgment ruling in favor of Henkel was affirmed on appeal, and without prejudice if the district court was reversed. On May 3, 1999, the district court entered an order dismissing without prejudice the remaining claim against Henkel.1 Also on that day, the district court granted plaintiffs' second Rule 54(b) motion and expressly designated the February 8 and February 22 summary judgment rulings as final judgments.2

On appeal, Columbian filed a motion to dismiss for lack of appellate jurisdiction, arguing that appellate jurisdiction is defective because appellants' notice of appeal preceded the trial court's designation of its summary judgment decisions as final. Henkel has filed a motion making essentially the same arguments. The Swopes have filed memoranda in opposition, and Henkel has replied.

This Court's jurisdiction is limited by 28 U.S.C. § 1291, which authorizes appeals from "final decisions of the district courts." Hence, as a general rule, all claims and issues in a case must be adjudicated before appeal, and a notice of appeal is effective only if it is from a final order or judgment. There are exceptions, of course, and one such exception is found in St. Paul Mercury Insurance Co. v. Fair Grounds Corp.3 In that case, this Circuit held that "a premature notice of appeal is effective if Rule 54(b) certification is subsequently granted."4 Here, the Swopes filed a notice of appeal at the same time they filed for Rule 54(b) certification. Since the Swopes' Rule 54(b) motion was subsequently granted,5 the rule in St. Paul Mercury Insurance Co. controls and appellate jurisdiction is proper.

Appellees argue, however, that St. Paul Mercury Insurance Co. is inconsistent with United States v. Cooper6 and FirsTier Mortgage Co. v. Investors Mortgage Ins. Co.7 FirsTier involved a plaintiff who had filed a notice of appeal close to a month before entry of judgment, but after a bench ruling on the same claims. FirsTier held that Federal Rule of Appellate Procedure 4(a)(2) "permits a notice of appeal from the final judgment only when a district court announces a decision that would be appealable if immediately followed by the entry of judgment."8

In Cooper, the Fifth Circuit relied on FirsTier to hold that no appellate jurisdiction existed where a plaintiff purported to appeal from a magistrate's report and recommendation, even though the district court subsequently entered final judgment.9 In so holding, it disapproved the "Jetco-Alcorn-Alcom" line of cases, which had held that the circuit can consider a premature appeal where judgment becomes final prior to disposition of the appeal.10 Though Cooper did not discuss St. Paul Mercury Insurance Co., it stated that "to the extent that our prior cases allowed appeal of non-final decisions, they are no longer good law...."11

Cooper does not abrogate St. Paul Mercury Insurance Co. — Cooper is not an en banc opinion, and FirsTier (decided in 1991) is not an intervening decision (St. Paul Mercury Insurance Co. was decided in 1997). Hence, the Cooper panel cannot have overruled St. Paul Mercury Insurance Co.12 Moreover, the logic of Cooper is not inconsistent with that of St. Paul Mercury Insurance Co. St. Paul Mercury Insurance Co. may be limited to the Rule 54(b) scenario, because Rule 54(b) was created specifically to avoid piecemeal appeals and to create finality for appeal.13 Cooper, on the other hand, applies to non-final orders that become final through means other than a Rule 54(b) motion; and arguably it may apply only in the more limited situation where the order purportedly appealed from "can never be a final decision."14 In any event, it is unnecessary to decide today the exact scope of Cooper, since it does not conflict with St. Paul Mercury Insurance Co., by which we are bound.

We observe that finality in this case was not created by the filing or granting of the stipulated motion that purported to be a Rule 41(a) dismissal of the remaining claim against Henkel.15 Hence, the trial court's granting of the Rule 54(b) motion was not superfluous and St. Paul Mercury Insurance Co. controls.

It is a settled rule in the Fifth Circuit that appellate jurisdiction over a non-final order cannot be created by dismissing the remaining claims without prejudice. This rule originated in Ryan v. Occidental Petroleum Corp., in which a district court granted a defendant's motion and dismissed the majority of plaintiff's complaint.16 In order to appeal, the plaintiff obtained an order dismissing without prejudice his remaining substantive claims against the would-be appellees; but the plaintiff did not file a Rule 54(b) motion to designate the earlier ruling as final.17 The Ryan court found it lacked appellate jurisdiction because a dismissal without prejudice "cannot be regarded as terminating the litigation between the[] parties."18 In the absence of Rule 54(b) certification, the trial court's rulings were held to lack finality under 28 U.S.C. § 1291.19

The Ryan rule is employed by three of our sister circuits.20 But two circuits have adopted...

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