When Can You Appeal an Order That Only Dismisses Some Claims or Parties? A Primer on Rule 54(b) Certification

        It’s a common occurrence: midway through a case, an order granting partial summary judgment or dismissal cleaves off some of the claims or parties from the action.  Because such orders do not resolve the case in its entirety, they are not “final” appealable judgements under 28 U.S.C. § 1291. And without a final order, the parties are forced to litigate the remainder of the action to its conclusion before initiating an appeal.  This can inject years of delay and – in many cases – necessitate a costly, second trial.

            However, there is a limited workaround. Federal Rule of Civil Procedure 54(b) empowers a district court to certify an order that disposes of some, but not all, claims or parties as a “final judgment,” thereby paving the way for an appeal.  (In some instances, a party can also file an interlocutory appeal, but that will be discussed elsewhere).  There are three prerequisites to Rule 54(b) certification: (1) there must be “multiple claims or parties”; (2) the order being appealed must have finally determined “at least one of the claims or the rights and liabilities of at least one party”; and (3) the district court must make “an express determination that there is no just reason for delay.’”[1] 

            Certification, though, is not liberally granted – it will “not be entered routinely or as a courtesy or accommodation to counsel.”[2] Because of the policy against piecemeal appeals, the Second Circuit has warned that a district court’s authority under Rule 54(b) should be “exercised sparingly” and “only if there are interests of sound judicial administration and efficiency to be served, or in the infrequent harsh case where there exists some danger of hardship or injustice through delay which would be alleviated by immediate appeal.” Harriscom Svenska AB v. Harris Corp., 947 F.2d 627, 629 (2d Cir. 1991).

The requirements for Rule 54(b) certification are clear in theory, but often murky in practice.  This post aims to bring some clarity to Rule 54(b) and offer guidance to practitioners pursuing (or defending again) a Rule 54(b) certification motion.  

Preconditions to Rule 54(b) Certification

1.    Multiplicity

The existence of multiple parties is easy to ascertain.  The existence of multiple claims, on the other hand, requires more detailed attention.

The first thing to grasp here is that, for purposes of Rule 54(b), a claim is not coterminous with a cause of action.  Many complaints are kitchen-sink compendiums of causes of action that are duplicative or stated in the alternative.  Rule 54(b) requires courts to look past the labels and adopt a pragmatic approach to determine whether the claims are “separate and distinct.” The purpose of this inquiry is to promote judicial economy and protect appellate panels from having “to familiarize themselves with a given case in successive appeals from successive decisions on interrelated issues.”[3] 

  Claims are separate and distinct where “they involve different questions of fact and law,” even where they “arise from the same underlying facts.”[4]  Where, by contrast, a claimant presents “a number of legal theories, but will be permitted to recover only on one of them, the bases for recovery are mutually exclusive, or simply presented in the alternative, . . . [the] plaintiff has only a single claim for relief for purposes of Rule 54(b).”[5]  

Multiplicity is easiest to establish where the “elements [of the claims] and the potential recoveries differ” and where “the claim for greater relief would be pressed by the plaintiff even if the other claim were granted.”[6]  For example, in Cullen v. Margiotta, plaintiffs alleged that the local Republican Committee and County conspired to coercively exact contributions from town employees, in violation of Section 1983 and RICO.  The Second Circuit held that the two claims were distinct because there was virtually no overlap between the elements of Section 1983 and RICO and because RICO authorized treble damages.[7]  Thus, the Cullen plaintiffs could still pursue RICO damages even after recovering on the Section 1983 claim.  

On the flipside, multiplicity is most obviously lacking where the dismissed and surviving claims are claims pled in the alternative (e.g., a breach of contract and quantum meruit claim)[8] or where the claims require identical proofs (e.g., discrimination claims brought under substantively identical federal and state laws).

In between these two poles lay a chasmic grey zone where, in the colorful words of the Ninth Circuit, “the essence [of a claim for Rule 54(b) purposes] eludes the grasp like quicksilver.”[9]  Certification in this grey zone hinges not on some bright-line principle, but on a court being persuaded that the differences between the dismissed and surviving claims “sufficiently outweigh what they have in common.”[10]

Sometimes a difference in burdens suffices.  For example, in NAACP v. Am. Family Mut. Ins. Co., 978 F.2d 287 (7th Cir. 1992), the NAACP brought an action alleging that redlining violated the Fair Housing Act (“FHA”) and several other state and federal anti-discrimination statutes.  The Seventh Circuit held that the district court properly certified the dismissal of the FHA claim because the plaintiff faced two different burdens of proof: disparate impact for the FHA claim and intentional discrimination for the surviving claims. 

But a difference in burdens is not always dispositive. Thus, in Barnett v. MacArthur, 715 F. App'x 894 (11th Cir. 2017), a plaintiff brought a Section 1983 claim against a sheriff for false arrest and a state law claim for false imprisonment.  The Eleventh Circuit acknowledged that the burdens differed (only the latter required a showing that an official policy caused the detention) and that the potential damages under Section 1983 were higher than under state law. Nonetheless, the court found the claims were not sufficiently distinct for purposes of Rule 54(b).

Courts will sometimes find multiplicity where a single act causes injury to different rights. For example, the Sixth Circuit found that a challenge to the ACA’s individual mandate alleging violations of the right to association, right to liberty, and right to privacy stated separate claims. U.S. Citizens Ass'n v. Sebelius, 705 F.3d 588, 595 (6th Cir. 2013). But in other instances, courts have declined to certify claims alleging distinct injuries, even where those injuries arose from different actions.  Thus, the Ninth Circuit found that an employee’s claim based on an unfavorable reassignment was not distinct from her claim based on a demotion, because both claims shared a common feature – namely, that the employer’s actions were motivated by ageism. Wood v. GCC Bend, LLC, 422 F.3d 873, 880-81 (9th Cir. 2005).

In some cases, courts will grant certification notwithstanding a near-complete factual overlap between the claims, either because the facts at issue in the certified judgment are unlikely to be disputed during the litigation of the surviving claim,[11] or because certification will streamline the legal proceedings.[12]

The variance within the caselaw reflects the fact that the multiplicity inquiry is not rooted in some abstract philosophical commitment to defining the essence of a “claim,” but in a practical desire to avoid the pitfalls of piecemeal appeals.

Given the above, the best way for a party to succeed on a Rule 54(b) motion is to establish: (1) that different facts and/or legal standards underlie the claims; (2) that the movant could separately recover on each of the claims; and (3) that the legal and factual differences are such that the appellate court will not have to familiarize itself with the same set of facts in two successive appeals.

2.    Finality

Compared to multiplicity, the finality inquiry is blessedly simple.  To satisfy the finality requirement, a decision must be a “‘judgment’ in the sense that it is a decision on a cognizable claim for relief, and it must be ‘final’ in the sense that it is an ultimate disposition of an individual claim entered in the course of a multiple claims action.”[13] A simple trick is to “ask whether [the order] would count as a final decision in a hypothetical independent case” – that is, whether it would end the litigation and leave nothing for the court to do but execute the judgment.[14] 

Accordingly, the following do not qualify for Rule 54(b) certification:

• An order granting or denying summary judgment that only partially adjudicates the claim – e.g., a decision that finds liability without determining damages.[15]

• An order dismissing only a portion of a claim – e.g., an order dismissing a punitive damages claim that leaves compensatory a damages claim intact.[16]

• An order requiring that a claim be submitted to arbitration.[17]

• An in limine evidentiary ruling, even if it effectively disposes of a claim in the case.[18]

• An order striking a jury demand.[19]

• An order denying class certification.[20]

3.    No Just Reason for Delay

Once multiplicity and finality are established, the district court must still find that there is “no just reason for delay.”  To make that finding, courts must balance the “judicial administrative interests and the equities involved” and determine that certification is necessary to alleviate some hardship or injustice.[21]  If that guidance sounds vague, it’s for good reason: as the Supreme Court has recognized, there are far too many factual and legal constellations to “fix or sanction narrow guidelines for the district courts to follow.” Curtiss-Wright Corp. v. General Elec. Co., 446 U.S. 1, 10-11 (1980). 

The following are a few examples where courts have found “no just reason for delay”:

• Where a plaintiff might be prejudiced by a delay in recovering an award, for example by forfeiting interest payments.[22]

• Where a party might become insolvent in the interim. [23]

• Where reversal on appeal would save a minor plaintiff from having to testify about sexual assault a second time. [24]

• Where resolution of the certified claims would facilitate a settlement of the remaining claims. [25]

• Where resolution of the certified claim would confine the scope of a particularly complicated case and streamline further litigation. [26] 

• Where resolution would conserve a party’s resources by producing a res judicata bar in parallel proceedings. [27] 

• Where “an expensive and duplicative trial could be avoided if, without delaying prosecution of the surviving claims, a dismissed claim were reversed in time to be tried with the other claims.”[28]

Courts are disinclined to certify dismissed claims that would be mooted by an unfavorable disposition of the surviving claims.  For example, Section 1983 plaintiffs often bring claims against individual officers and a separate claim against the municipality alleging that a “policy or practice” led to the constitutional violation. Such claims involve different sets of proofs and are directed against different parties.  Nonetheless, because a claim against the municipality cannot succeed without establishing an underlying constitutional violation by an individual officer, courts rarely certify orders dismissing municipal liability claims.[29]

Finally, practitioners mustn’t forget: Rule 54(b) motions are deviations from the norm.[30]  For that reason, a Rule 54(b) movant will rarely prevail by raising generic protestations of delay. Delay is inherent in every denial of a Rule 54(b) motion, as is the attendant risk that memories will fade or that the parties will be forced to engage in duplicative discovery or suffer a second trial.[31]  A successful Rule 54(b) motion, then, should articulate some harm or interest that is unique to that particular case. The moving party must show some “unusual hardship or injustice” above and beyond what a party would face if required to wait – in accordance with normal federal practice – for disposition of the entire case before filing an appeal.[32] 

Other Practice Pointers

Are the Merits of the Appeal Relevant?

Sort of. Rule 54(b) does not require a party to demonstrate a meritorious appeal, and there is some authority within the Second Circuit the appeal’s merits are irrelevant to Rule 54(b) certification.[33] However, as a practical matter, a court is unlikely to certify if it believes the appeal to be frivolous, and other cases have held that the existence of a viable issue on appeal weighs (marginally and indeterminably) in favor of certification.[34] What’s clear is that no demonstration of the merits will compensate for a failure to satisfy the three-part test explained above.

What is the Deadline to File a Rule 54(b) Motion?

While there is no fixed time limit for filing a Rule 54(d) motion, courts have held that the motion must be “seasonable.”  As the Seventh Circuit recently explained, tardiness in filing a Rule 54(b) motion “creates delay and undermines the function of a partial final judgment.”[35]  Thus, while not strictly required, the best practice is to file a Rule 54(b) motion within 30 days.

            Can You Appeal a Rule 54(b) Determination?

            There’s no right of appeal if the district court denies a Rule 54(b) motion.  However, an appellee may challenge a Rule 54(b) certification.

            There are two standards of review on appeal.  The first two elements (multiplicity and finality) are reviewed de novo.  The third element (“no just reason for delay”) is reviewed for abuse of discretion.[36]  Certification orders that consist of “mere boiler-plate approval phrased in appropriate language but unsupported by evaluation of the facts or analysis of the law,” are unlikely to survive review.[37]

J. Pace Law, PLLC can help you craft or oppose a Rule 54(b) certification. If you require further assistance, please click on the Contact Us link.   

[1] Fed. R. Civ. P. 54(b); Transport Workers Union, Local 100 v. N.Y. City Transit Auth., 505 F.3d 226, 230 (2d Cir. 2007).

[2] Siderpali, S.P.A. v. Judal Indus., 833 F. Supp. 1023, 1034 (S.D.N.Y. 1993).

[3] Novick v. AXA Network, LLC, 642 F.3d 304, 311 (2d Cir. 2011).

[4] Gallo Wine Distributors, L.L.C. v. Niebaum-Coppolla Estate Winery, L.P., 56 F. App'x 8, 9 (2d Cir. 2003).

[5] 10 Wright & Miller, Fed. Prac. & Proc. Civ § 2657.

[6] Cullen v. Margiotta, 811 F.2d 698, 711-12 (2d Cir. 1987).

[7] See also Geneva Pharmaceuticals Tech. Corp. v. Barr Labs, Inc., 2002 U.S. Dist. LEXIS 18177, 2002 WL 31159048, as *3 (S.D.N.Y. Sep. 27, 2002).

[8] Plum Creek Tech., LLC v. Next Cloud, LLC, No. 8:19-cv-1974-T-60CPT, 2020 U.S. Dist. LEXIS 41429, at *13 (M.D. Fla. Feb. 5, 2020).

[9] Cont'l Airlines, Inc. v. Goodyear Tire & Rubber Co., 819 F.2d 1519, 1525 (9th Cir. 1987).

[10] In re Fifth Third Early Access Cash Advance Litig., 925 F.3d 265, 275 (6th Cir. 2019).

[11] Ty, Inc. v. Publications Int’l Ltd., 292 F.3d 512, 515–516 (7th Cir. 2002).

[12] Texaco, Inc. v. Ponsoldt, 939 F.2d 794, 797-98 (9th Cir. 1991).

[13] Curtiss-Wright Corp. v. General Elec. Co., 446 U.S. 1, 7 (1980).

[14] Horn v. Transcon Lines, 898 F.2d 589, 593 (7th Cir. 1990); State Street Bank & Trust Co. v. Brockrim, Inc., 87 F.3d 1487, 1490 (1st Cir. 1996).

[15] Kaszuk v. Bakery & Confectionery Union, 791 F.2d 548, 553 (7th Cir. 1986).

[16] Arizona State Carpenters Pension Trust Fund v. Miller, 938 F.2d 1038, 1040 (9th Cir. 1991).

[17] Perera v. Siegel Trading Co., 951 F.2d 780, 786 (7th Cir. 1992).

[18] Ultra-Precision Mfg. Ltd. v. Ford Motor Co., 338 F.3d 1353, 1358-60 (Fed. Cir. 2003) (in limine evidentiary ruling is not final, because it is by definition preliminary and subject to change as case unfolds).

[19] Howard v. Parisian, Inc., 807 F.2d 1560, 1566 (11th Cir. 1987) (order denying jury demand does not dispose entirely of claim but leaves claim pending for bench trial).

[20] Chevron USA, Inc. v. School Board Vermilion Parish, 294 F.3d 716, 719–720 (5th Cir. 2002).

[21] United Bank of Kuwait PLC v. Enventure Energy Enhanced Oil Recovery Assocs.-Charco Redondo Butane, 763 F. Supp. 729, 731 (S.D.N.Y. 1990).

[22] Curtiss-Wright Corp., 446 U.S. at 10-11.

[23] Shintom Am., Inc. v. Car Telephones, Inc., 45 F.3d 1107, 1110–1111 (7th Cir. 1995).

[24] Doe v. City of Waterbury, Nos. 3:01cv2298 (SRU), 03cv571), 2006 U.S. Dist. LEXIS 85962, at *6 (D. Conn. Nov. 16, 2006).

[25] New York v. Amro Realty Corp., 936 F.2d 1420, 1426 (2d Cir. 1991).

[26] Continental Airlines v. Goodyear Tire & Rubber Co., 819 F.2d 1519, 1525 (9th Cir. 1987).

[27] Shamley v. ITT Corp., 869 F.2d 167, 170 (2d Cir. 1989).

[28] Cullen v. Margiotta, 811 F.2d 698, 711 (2d Cir. 1987).

[29] Richardson v. City of N.Y., 2007 U.S. Dist. LEXIS 43507, at *8 (S.D.N.Y. June 14, 2007); Trujillo v. Campbell, Civil Action No. 09-cv-03011-CMA-KLM, 2012 U.S. Dist. LEXIS 145761, at *5-6 (D. Colo. Oct. 10, 2012); but see Mwangangi v. Nielsen, 536 F. Supp. 3d 371, 389 (S.D. Ind. 2021).

[30] Horn v. Transcon Lines, Inc., 898 F.2d 589, 592 (7th Cir. 1990).

[31] Jeffery v. City of N.Y., No. 20-CV-2843 (NGG) (RML), 2022 U.S. Dist. LEXIS 122891, at *10 (E.D.N.Y. July 12, 2022); Adrian v. Town of Yorktown, 210 F. App'x 131, 133 (2d Cir. 2006).

[32] Timperio v. Bronx-Lebanon Hosp. Ctr., No. 18-CV-1804 (PGG), 2020 U.S. Dist. LEXIS 262601, 2020 WL 9211177, at *3 (S.D.N.Y. Mar. 9, 2020).

[33] TADCO Construction Grp. Corp. v. Dormitory Auth. of N.Y., No, 08-CV73 (KAM) (JMA), 2012 U.S. Dist. LEXIS 102136, at *7 (E.D.N.Y. July 23, 2012); Jeffery v. City of N.Y., No. 20-CV-2843 (NGG) (RML), 2022 U.S. Dist. LEXIS 122891, at *10 n.2 (E.D.N.Y. July 12, 2022).

[34] See Swope v. Columbian Chems. Co., 281 F.3d 185, 193 (5th Cir. 2002) (“[A]ny factors which make an appeal meritorious, and which support the argument for appeal as of right, are properly within the cognizance of the trial court in deciding a Rule 54(b) motion.”); Banks v. Lakeland Nursing & Rehab. Ctr., LLC, No. 3:22-CV-433-DPJ-FKB, 2023 U.S. Dist. LEXIS 57927, at *10 (S.D. Miss. Apr. 3, 2023);  Zeiser Motors, Inc. v. Sentry Select Ins. Co., No. 4:10CV1261 CDP, 2011 U.S. Dist. LEXIS 103291, at *5 (E.D. Mo. Sep. 13, 2011).

[35] DaSilva v. Indiana, 30 F.4th 671, 673 (7th Cir. 2022).

[36] Ginett v. Comput. Task Grp., 962 F.2d 1085, 1091-92 (2d Cir. 1992).

[37] Novick v. AXA Network, LLC, 642 F.3d 304, 310 (2d Cir. 2011).