As is our tradition, this article discusses important 9th Circuit appellate procedure cases from the past year. Cases from 2024 covered the usual topics, from appealability to appellate ethics. And two key procedural doctrines—anti-SLAPP appealability and the binding-dicta doctrine—appear poised for reversal in the future.
Finality and appealability
In United States v. Allahyari, 99 F.4th 486 (9th Cir. 2024), the 9th Circuit considered when an order to sell real property is final for purposes of appeal. The case involved an appeal of an order holding that a deed of trust was fraudulently transferred and thus lacked priority over IRS tax liens. The panel dismissed the appeal for lack of jurisdiction, holding that the district court order was not final. The court explained that for a foreclosure order to be final for appeal, it must determine not only any superior liens, but also what the order of sale shall contain, so that all rights of the parties are settled with nothing left to do but make the sale and pay off the liens. The 9th Circuit found that the "needful details" to ensure finality were absent, like "the sequence in which the funds obtained from a sale should be paid out." In addition, the order did not provide any detail about how the sale should be conducted.
The 9th Circuit also addressed finality for appellate purposes in Diaz v. Macy's West Stores, 101 F.4th 697 (9th Cir. 2024), regarding orders to compel arbitration. A terminated employee sued Macy's under California's Private Attorneys General Act. The district court compelled arbitration for all claims brought in both the employee's individual and non-individual capacities and denied her motion to stay pending a California Supreme Court decision that would resolve whether dismissal of non-individual PAGA claims is required when arbitration is compelled as to individual claims.
The 9th Circuit panel affirmed in part and vacated in part. Relevant to appellate attorneys, the panel held that it had jurisdiction because the ruling to compel arbitration was sufficiently final under 9 U.S.C. § 16(a)(3), which states that a judicial decision on an arbitration dispute is "final" when it "ends the litigation on the merits and leaves nothing more for the court to do but execute the judgment." Even though the district court did not expressly dismiss the claims, the language of the denial of the requested stay and the accompanying closure of the action indicated that the district court intended the closure to be final.
Another finality case, Doe v. Fitzgerald, 102 F.4th 1089 (9th Cir. 2024), addressed whether a district court stay order was final for appellate purposes. The plaintiffs sued under the civil remedy provision of the Trafficking Victims Protection Reauthorization Act. The United States Attorney's Office intervened and moved to stay the action against Fitzgerald pending the resolution of a related criminal action against a different defendant. The district court granted the government's motion to stay, and plaintiffs appealed that stay order.
On appeal, the panel considered whether it had appellate jurisdiction under 28 U.S.C. § 1291 to review the district court's stay order and determined that it did. The court held that a lengthy and indefinite stay order is final for purposes of appeal because it effectively puts the plaintiffs out of court. The decision underscored that appellate jurisdiction exists over a lengthy and indefinite order to stay regardless of whether the district court surrenders jurisdiction to a federal or state court, and even if it is possible that the district court will resume proceedings following the stay.
Continuing the theme of jurisdictional limits, in CPC Patent Technologies v. Apple, 119 F.4th 1126 (9th Cir. 2024), a 9th Circuit panel evaluated whether a discovery order under 28 U.S.C. § 1782—a statute governing discovery for use in foreign tribunals—was final on appeal. After CPC sought discovery from Apple for use in a patent infringement suit in Germany, the district court issued an order approving CPC's document subpoenas. Apple served objections and then appealed the order. The panel held that the order was not final because the district court did not rule on Apple's objections to CPC's subpoena, and thus the scope of production remained unresolved. Moreover, Apple's concerns hinged on production of proprietary code and the injury that could result from lesser confidentiality protections in a foreign proceeding. But because the district court had not ordered production of the code, finality was lacking, i.e., significant questions about the scope of discovery in the § 1782 applications remained. In short, the panel held that for an order to be reviewable on appeal, it must resolve all material disputes between the parties.
In Martinez v. ZoomInfo Technologies, 90 F.4th 1042 (9th Cir. 2024), the 9th Circuit voted to vacate a panel decision involving a class action challenging ZoomInfo's use of the plaintiffs' details in employment search profiles. The district court had denied ZoomInfo's motions to dismiss under Rule 12(b)(6) and to strike the case under California's anti-SLAPP statute. On appeal, the original panel applied 9th Circuit precedent allowing appeals from the denial of an anti-SLAPP motion as a collateral order. Finding it had appellate jurisdiction, the panel affirmed. Judge Desai wrote separately and urged her colleagues to overturn Circuit precedent and hold that denials of anti-SLAPP motions are not appealable because, in her view (shared by several other judges), "anti-SLAPP motions to strike require the court to assess the merits of a plaintiff's claim and are not effectively unreviewable on appeal." The panel decision was vacated, but then the case settled and the appeal was dismissed. Judge McKeown also penned a concurrence pointing out that five other circuits do not allow such appeals and that eight 9th Circuit judges have now written or concurred in decisions expressing the view that anti-SLAPP denial orders should not be appealable.
In another appeal from an order denying an anti-SLAPP motion, Judge Desai (in a concurrence to an affirmance of the district court's order) again "reiterate[d] the need for [the 9th Circuit] to reconsider" its precedent on appellate jurisdiction over anti-SLAPP denials as collateral orders. Young v. Neocortext, Inc., 2024 WL 4987254 (9th Cir. Dec. 5, 2024) (Desai, J., concurring). This remains an issue to watch.
Sanctions
With acerbic wit, a 9th Circuit panel decided an appeal of a default judgment in Transamerica Life Insurance v. Akop Arutyunyan, 93 F.4th 1136 (9th Cir. 2024). The panel detailed the defendants' myriad discovery violations. Initially, defendants failed to produce agreed supplemental discovery, and their recalcitrance to comply only grew. After missing several deadlines despite court orders, the magistrate judge issued orders to show cause and imposed new deadlines, which the defendants again missed. Eventually, the magistrate judge issued a report recommending a default judgment, which the district court adopted.
On appeal, the defendants argued the merits of their objections to Transamerica's discovery requests but failed to address their repeated noncompliance. Because the defendants' arguments did not address the district court's reasoning, the appellate panel upheld the order requiring discovery answers.
The defendants also challenged the entry of a default judgment against them. Again, the panel affirmed.
After painting a picture of the case's byzantine procedural history and the defendants' confounding behavior, the panel spared no words in characterizing the appeal as frivolous and totally without merit. Even at oral argument, defendants' counsel continued to minimize their noncompliance--and made misstatements--prompting the court to ponder the maxim of Hanlon's Razor: "Never attribute to malice that which is adequately explained by stupidity." Without deciding whether malice or stupidity explained defense counsel's missteps, the panel ordered the defendants to show cause as to why it should not impose sanctions and refer the matter to the state bar.
Another 9th Circuit panel considered deficient legal practice in Grant v. City of Long Beach, 96
F.4th 1255 (9th Cir. 2024). Plaintiffs had sued the City of Long Beach for alleged constitutional and due process violations. After summary judgment for the City, the plaintiffs filed an opening appellate brief filled with mischaracterizations and hallucinated citations. Their brief cited two cases it claimed addressed the unlawful removal of a child from a parent's home, but in neither case were the words "parent" or "child" mentioned. Although called out on this, plaintiffs filed no reply brief. And despite a pre-argument focus letter, plaintiffs' counsel gave no clear answers or apology at oral argument.
In its published opinion, the court identified 11 cases for which the facts or holdings had been misrepresented in the opening brief, and two more cases that appeared completely fabricated. The panel held that the brief, which almost entirely lacked accurate legal citations, was so deficient that it violated Federal Rule of Appellate Procedure 28(a)(8)(A), and the panel therefore sua sponte dismissed the appeal. Grant provides the ultimate cautionary tale for totally disregarding the rules that require supplying correct supporting citations.
Stare Decisis
In AGK Sierra de Montserrat, L.P. v. Comerica Bank, 109 F.4th 1132 (9th Cir. 2024), the 9th Circuit panel ruled that district courts must follow 9th Circuit precedent on the interpretation of state law unless state courts later indicate that the federal court's interpretation is incorrect. The appeal concerned whether an attorney fees award incurred in prosecuting an indemnity action contravened California law. The court reiterated that, absent a ruling from the state's highest court, federal courts must follow intermediate state appellate court decisions unless strong evidence exists that the highest state court would differ. The panel declined to follow an old 9th Circuit opinion, DeWitt v. Western Pacific Railroad, 719 F.2d 1448 (9th Cir. 1983), which had held that California law supports the award of first-party attorney fees incurred during prosecution of indemnification actions. Instead, the panel cited California appellate cases rejecting DeWitt's reasoning and holding that attorney fee provisions must be explicit in the indemnity agreement to be recoverable. The panel concluded that the California Supreme Court would likely align with the uniform judgment of state intermediate appellate courts and not the older Ninth Circuit opinion. The panel thus highlighted its commitment to aligning federal interpretations of state law with state appellate courts and indicated support for litigants citing state appellate decisions in the absence of definitive state high court signals otherwise. Judge Miller's concurrence explains why it is appropriate to apply a "more flexible standard of intra-circuit stare decisis to questions of state law than to questions of federal law."
Honorable mention: The binding-dicta flamingo
We cannot conclude without mentioning Judge Forrest's concurrence in Stein v. Kaiser Foundation Health Plan, 115 F.4th 1244 (9th Cir. 2024). In the context of an en banc decision (also authored by Judge Forrest) overturning circuit precedent and holding that the first-to-file rule is not jurisdictional, Judge Forrest wrote separately to address the 9th Circuit's anomalous "dicta-is-binding" rule. See id. at 1247. We previously discussed the Ninth Circuit's unique approach to dicta in our September 2022 column, "Dicta ain't necessarily so." See also Barapind v. Enomoto, 400 F.3d 744, 751 (9th Cir. 2005) (en banc) (explaining that the discussion at issue was "law of the circuit" because it addressed the issue and was decided in an opinion joined by a majority of the panel--"regardless of whether it was in some technical sense 'necessary' to [the] disposition of the case.").
Judge Forrest sharply critiqued the 9th Circuit's binding-dicta rule because it differs from "the jurisprudence of the Supreme Court and every other circuit court in the nation." Stein, 115 F.4th at 1247. In Stein, the district court and three-judge panel applied previous 9th Circuit dicta indicating that the first-to-file rule is jurisdictional, despite its inconsistency with Supreme Court precedent. Judge Forrest lamented the inefficiency of requiring an "en banc court . . . to convene to tidy up the law," whereas in other circuits, the "three-judge panel could have analyzed [the] issue without constraint." Id.
Judge Forrest also argued that the 9th Circuit's aberrational rule is unworkable because it requires lower courts to apply "well-reasoned" dicta, a test lacking objectivity, even in comparison to the nebulous task of determining which parts of an opinion are dicta. See id. at 1252. "[M]ost troubling" to Judge Forrest was the rule's violation of Article III's limitation of federal judicial power to actual cases or controversies. See id. at 1252-53. Judge Bumatay joined Judge Forrest's concurrence. And Judges VanDyke, Tashima and Kleinfeld have previously spoken out against the Circuit's binding-dicta rule. Should a majority of judges adopt this view, the 9th Circuit's approach to the precedential weight of dicta will not for much longer "stand out like a flamingo in a flock of finches." See id. at 1250.
Reprinted with permission from Daily Journal.
