Wingerter v. Chester Quarry Co.

• Decision Date: 11 September 1998
• Docket Number: No. 98-3069,98-3069
• Parties: (7th Cir. 1998) KEVIN WINGERTER, Plaintiff-Appellee, v. CHESTER QUARRY COMPANY, Defendant-Appellant. SUBMITTED:
• Court: U.S. Court of Appeals — Seventh Circuit

Page 657

185 F.3d 657 (7th Cir. 1998)

KEVIN WINGERTER, Plaintiff-Appellee, v. CHESTER QUARRY COMPANY, Defendant-Appellant.

No. 98-3069

United States Court of Appeals, Seventh Circuit

SUBMITTED: SEPTEMBER 11, 1998

DECIDED: SEPTEMBER 11, 1998

OPINION ISSUED: July 23, 1999^*

Appeal from the United States District Court for the Southern District of Illinois. No. 97 C 206--Paul E. Riley, Judge. [Copyrighted Material Omitted]

[Copyrighted Material Omitted]

Before MANION, KANNE, and ROVNER, Circuit Judges.

PER CURIAM.

In March 1997, Kevin Wingerter filed a complaint under the Jones Act, 46 U.S.C. sec. 688, and under general admiralty and maritime law, naming Chester Quarry Company ("Chester") as the lone defendant. Wingerter sought damages for injuries he sustained as a result of Chester's alleged negligence while he was employed by Chester as a towboat pilot on the Mississippi River. Wingerter then filed a First Amended Complaint, which added a defendant subsequently dismissed by partial summary judgment. In January 1998, Wingerter filed a Second Amended Complaint, which set forth the alleged circumstances with more specificity, and Chester filed its answer and affirmative defenses.

In June 1998, Wingerter filed a motion for leave to file a Third Amended Complaint in order to designate the action as being one in admiralty pursuant to Fed. R. Civ. P. 9(h), the practical effect of which was the waiver or nullification of his prior demand for a trial by jury. See Fed. R. Civ. P. 38(e). After the magistrate judge granted Wingerter's motion, and the Third Amended Complaint was filed, Chester filed a motion with the district court judge to vacate the order granting leave to file the Third Amended Complaint, or, in the alternative, for leave to file an answer and a demand for a jury trial. On July 14, 1998, the district court judge denied the motion to vacate and set the bench trial for September 14, 1998.

On August 11, 1998, Chester filed a notice of appeal from the district court's denial of the motion to vacate. Chester also filed a motion to stay the trial pending appeal, which the district court denied. This Court ordered the parties to file brief memoranda addressing the Court's jurisdiction over the appeal. On September 11, 1998, this Court dismissed the appeal for lack of appellate jurisdiction, denied Chester's renewed motion for a stay as moot, and indicated that this opinion setting forth the panel's reasoning would follow.

Analysis

A court of appeals has an obligation to examine its jurisdiction sua sponte, even if the parties fail to raise a jurisdictional issue. United States v. County of Cook, 167 F.3d 381, 387 (7th Cir. 1999). Assuming for the moment that we have appellate jurisdiction, we must decide whether Chester waived its right to appeal, and, if not, which orders would be before this Court on appeal. The magistrate judge was authorized to rule on the motion for leave to file the Third Amended Complaint pursuant to 28 U.S.C. sec. 636(b)(1)(A), which provides that the district court may designate a magistrate judge to hear and determine, with certain exceptions not relevant here, any nondispositive pretrial matter pending before the district court. See United States v. Brown, 79 F.3d 1499, 1503 (7th Cir.), cert. denied, 519 U.S. 875 (1996); United States District Court for the Southern District of Illinois Local Rule 25(c). Designation of the magistrate judge to hear such pretrial matters is automatic by operation of that court's Local Rule 26(a)(1). Although a magistrate judge's order entered pursuant to sec. 636(b)(1)(A) is "'self- operating' and thus valid when entered," Brown, 79 F.3d at 1503 (citation omitted), the district court was authorized to review the magistrate judge's order pursuant to the second sentence of sec. 636(b)(1)(A), which provides that the district court "may reconsider any pretrial matter under this subparagraph (A) where it has been shown that the magistrate's order is clearly erroneous or contrary to law," 28 U.S.C. sec. 636(b)(1)(A); Brown, 79 F.3d at 1503. Indeed, such a challenge to the magistrate judge's order is a necessary predicate to Chester's ability to attack the order on appeal. See Brown, 79 F.3d at 1504-05 ("failure to challenge before a district judge a magistrate's pretrial rulings under sec. 636(b)(1)(A) waives the right to attack such rulings on appeal" subject to certain "equitable considerations"). Pursuant to Local Rule 28(a), the district court's reconsideration of the magistrate judge's pretrial order may occur sua sponte, or by the filing of "a written statement of appeal" within 10 days of the issuance of the magistrate judge's order. Here it appears that Chester's motion to vacate, filed within 10 days of the entry of the magistrate judge's order, served as the statement of appeal. We therefore conclude that Chester has not waived its right to challenge both orders on appeal.

Again assuming for the moment that we do have appellate jurisdiction, we next consider which order or orders would be before us. The notice of appeal specified that the appeal was from the district court's denial of the motion to vacate and it was timely filed as to that order. See Fed. R. App. P. 3(c)(1)(B), 4(a)(1)(A). Thus, the question is whether the magistrate judge's order would also be before us on appeal. The two orders are so entwined that it would be inefficient to give them separate consideration. Moreover, because sec. 636(b)(1)(A) has a self-contained mechanism for the district court's review of the magistrate judge's pretrial rulings, an appeal from the district court's order would necessarily encompass an appeal from both orders, as it would be illogical to review the district court's order in isolation without reference to the magistrate judge's order. Accordingly, for purposes of our jurisdictional analysis, we will treat both orders as being subject to our review.

A. Final Order

In analyzing its appellate jurisdiction, an appellate court looks first to the final judgment rule. Then, if the appealed order does not qualify as a final decision, the court must determine whether any statutory exceptions or other bases of jurisdiction support appellate jurisdiction. Thus, we will start with an examination of whether the order granting leave to file an amended complaint, and the denial of reconsideration of that order, constitutes a final decision.

The baseline principle for appealability is the final judgment rule, as embodied in section 1291 of Title 28, which provides that a court of appeals "shall have jurisdiction of appeals from all final decisions of the district courts of the United States. . . ." 28 U.S.C. sec. 1291; Cunningham v. Hamilton County, 119 S. Ct. 1915, 1919 (1999). A decision is final where it "ends the litigation on the merits and leaves nothing more for the court to do but execute the judgment." Cunningham, 119 S. Ct. at 1920 (citation and internal quotation omitted). The final judgment rule has been explained as follows:

The effect of the statute is to disallow appeal from any decision which is tentative, informal or incomplete. Appeal gives the upper court a power of review, not one of intervention. So long as the matter remains open, unfinished or inconclusive, there may be no intrusion by appeal.

* * * *

Nor does the statute permit appeals, even from fully consummated decisions where they are but steps towards final judgment in which they will merge. The purpose is to combine in one review all stages of the proceeding that effectively may be reviewed and corrected if and when final judgment results.

Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 546 (1949).

In this case, the district court's order did nothing more than affirm the magistrate judge's decision to allow the filing of the Third Amended Complaint. Both orders are "managerial order[s], like dozens of others a court must enter in the course of complex litigation." See Equal Employment Opportunity Comm'n v. Mitsubishi Motor Mfg. of America, Inc., 102 F.3d 869, 871 (7th Cir. 1996). Accordingly, because such orders are reviewable at the end of the case, they are not immediately appealable. See id.; Bogard v. Wright, 159 F.3d 1060, 1063 (7th Cir. 1998) ("most procedural orders . . . are entered before final judgment, and so in principle anyway are reviewable, albeit not immediately, when the judgment is entered"). See also Bisciglia v. Kenosha Unified Sch. Dist. No. 1, 45 F.3d 223, 229-30 (7th Cir. 1995) (reversing in part for an erroneous denial of motion for leave to file an amended complaint). Furthermore, neither decision was "final" within the meaning of sec. 1291 in the traditional sense, as neither ended the litigation or afforded (or denied) any relief on the merits. See Mitsubishi, 102 F.3d at 871. Rather than terminating the litigation on the merits, "such an order ensures that litigation will continue in the District Court." Lauro Lines S.R.L. v. Chasser, 490 U.S. 495, 498 (1989) (internal quotation and citation omitted). Finally, other courts have held that an order granting leave to amend a complaint is not a final decision. See, e.g., Lawson v. Abrams, 863 F.2d 260, 262 (2d Cir. 1988) ("An order that grants leave to amend the complaint is plainly not a final decision because it allows the litigation to continue") (citations omitted); Levy v. Securities & Exchange Comm'n, 405 F.2d 484, 486 (5th Cir. 1968) (same); La Capria v. Compagnie Maritime Belge, 373 F.2d 579, 581 (2d Cir. 1967) ("No discussion is required to show that the order [granting leave to amend the complaint to designate the action as one in admiralty pursuant to Fed. R. Civ. P. 9(h)] is [not] a final decision under 28 U.S.C. sec. 1291. . .") (citations omitted). Accordingly, we conclude that neither order is appealable as a final decision within the meaning of sec. 1291. This is precisely the type of appeal that the final judgment rule was designed to prevent, as such a...