Parsons et al v. Ryan et al

Filing 3077

ORDER re: Magistrate Judge Duncan's jurisdiction. Signed by Senior Judge Roslyn O Silver on 12/6/18. (CLB)

1

WO

2
3
4
5
6

IN THE UNITED STATES DISTRICT COURT

7

FOR THE DISTRICT OF ARIZONA

8
9

Victor Antonio Parsons, et al.,
Plaintiffs,

10
11

ORDER

v.

12

No. CV-12-00601-PHX-ROS

Charles L Ryan, et al.,

13

Defendants.

14
15

In advance of the December 6, 2018, status conference, and to comply with the

16

Court’s own obligation to confirm it has jurisdiction, the Court will address in some detail

17

an argument Defendants have raised regarding Magistrate Judge Duncan’s jurisdiction.

18

BACKGROUND

19

When this case was filed in March 2012, it was assigned to District Judge Neil V.

20

Wake and referred to Magistrate Judge Mark E. Aspey. (Judge Wake subsequently

21

withdrew that referral.) The case proceeded before Judge Wake with discovery and motion

22

practice. Trial was set for October 20, 2014. A few months before trial, Judge Wake

23

referred this case to Magistrate Judge Duncan for a settlement conference. (Doc. 978).

24

The parties attended that settlement conference, continued to negotiate after the conference,

25

and simultaneously prepared for trial. On August 11, 2014, the case was reassigned from

26

Judge Wake to District Judge Diane J. Humetewa. (Doc. 1074). Less than a week before

27

trial, the parties filed a “Stipulation” indicating that they had agreed to a settlement. Less

28

than five minutes after filing that stipulation, the parties filed a “Joint Motion to Refer

1

Remainder of Case to Magistrate Judge Duncan and to Refer Case to Magistrate Judge

2

Buttrick for Mediation.” (Doc. 1186). That motion stated, in relevant part,

3
4
5
6

Pursuant to 28 U.S.C. § 636(c) and Fed. R. Civ. P. 73, the parties hereby
consent to have Magistrate Judge David Duncan conduct all further
proceedings in this case, including proceedings to determine the fairness of
the settlement pursuant to Fed. R. Civ. P. 23(e), and any other proceedings
contemplated by the settlement in this case.

7

The parties explained their motion was based on Magistrate Judge Duncan’s “constructive

8

participation in the settlement negotiations” which had “provided him with a unique ability

9

to effectuate the parties’ intent in any future proceedings.” (Doc. 1186 at 2). The request

10

for a referral to Magistrate Judge Buttrick was based on the parties’ settlement

11

contemplating the mediation of certain disputes before more formal “enforcement

12

proceedings” could be initiated. Based on the parties’ filings, Judge Humetewa vacated

13

the trial.

14

On October 22, 2014, Judge Humetewa granted the parties request for

15

“reassignment of this case to Magistrate Judge Duncan pursuant to 28 U.S.C. § 636(c) and

16

Rule 73 of the Federal Rules of Civil Procedure.” In doing so, Judge Humetewa stated

17

Judge Duncan would “conduct all further proceedings in this case.” (Doc. 1194). Judge

18

Humetewa denied the request to refer the case to Magistrate Judge Buttrick because “[i]n

19

light of the reassignment of this matter to Judge Duncan, any requests to refer the matter

20

to a magistrate judge . . . should be directed to Judge Duncan.” (Doc. 1194). Once the

21

case was reassigned to Magistrate Judge Duncan, he held the necessary hearings and

22

formally approved the parties’ settlement. (Doc. 1458). As recounted in prior orders,

23

Magistrate Judge Duncan then undertook a multi-year effort to have Defendants comply

24

with their settlement obligations. Magistrate Judge Duncan eventually issued multiple

25

rulings, prompting multiple appeals.

26

Magistrate Judge Duncan while the appeals were being briefed.

27
28

(Doc. 1817).

Proceedings continued before

In May 2018, Magistrate Judge Duncan informed the parties he would be retiring in
June 2018.

That announcement prompted defense counsel to research the “legal

-2-

1

ramifications” of Magistrate Judge Duncan’s retirement. (Doc. 2825 at 2). Defense

2

counsel discovered a 2003 case from the Seventh Circuit that prompted them to conclude

3

Magistrate Judge Duncan never had “subject matter jurisdiction to conduct any

4

proceedings in this case.” (Doc. 2825 at 2). On May 18, 2018, Defendants filed a motion

5

asking Judge Humetewa “to vacate the referral of this matter to Magistrate Judge

6

[Duncan].” (Doc. 2825). Defendants’ motion prompted Magistrate Judge Duncan to issue

7

an Order stating:

8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

Defendants have filed a motion seeking the return of the case to Judge
Humetewa pursuant to 28 U.S.C. § 636(c)(4) based upon the extraordinary
circumstances of the undersigneds disability retirement. This text only order
does not address that issue which is properly before the District Judge. This
Order addresses the Defendants jurisdictional argument and the request to
stay matters presently before the undersigned. Hatcher v. Consolidated City
of Indianapolis, 323 F.3d 513 (7th Cir. 2003), is neither controlling authority
and, in any event, is not persuasive given that it does not address the factual
scenario presented here. This action was referred to the undersigned to
conduct a settlement conference (Docs. 961, [978]). After that referral, and
successful negotiation of the Stipulation, the parties explicitly consented to
the undersigned continuing to exercise jurisdiction over this action pursuant
to 28 U.S.C. § 636(c) to promote the interests of judicial economy and
efficiency (Doc. 1186). Moreover, there is no statutory or Ninth Circuit
authority precluding such assignment. Accordingly, the undersigned rejects
Defendants jurisdictional argument and affirms all rulings, briefing
schedules, and pending matters set for hearing until an order to the contrary
issues.
(Doc. 2826).
On June 5, 2018, Judge Humetewa issued a similar order. Judge Humetewa ruled,
in relevant part,
Citing 28 U.S.C. § 636(c)(4) and Federal Rule of Civil Procedure 73(b)(3),
Defendants attack Judge Duncan’s subject matter jurisdiction over this action
and request that the referral of this action be vacated for extraordinary
circumstances. Defendants allege that under Hatcher v. Consolidated City
of Indianapolis, 323 F.3d 513 (7th Cir. 2003), their explicit agreement to
Judge Duncan’s jurisdiction in October 2014 is invalid. Judge Duncan has
addressed this argument, but the undersigned agrees that Hatcher is factually
and legally distinguishable from this case. Defendants’ position is also
foreclosed by the Supreme Court’s decision in Roell v. Withrow, 538 U.S.
-3-

1
2
3
4

580, 587 (2003), because while there does not appear to be any defect in the
process by which Judge Duncan became involved in this case, and even if
there was one, it was cured by the parties’ explicit consent to his jurisdiction
in their standalone joint motion at Doc. 1186 (“Pursuant to 28 U.S.C. §
636(c) and Fed. R. Civ. P. 73, the parties hereby consent to have Magistrate
Judge David Duncan conduct all further proceedings in this case[.]”).

5

***

6

As a consequence, the transfer of this case consistent with the parties’
consent extinguished this Court’s jurisdiction over this matter. The motion
to vacate the Magistrate Judge referral is therefore denied.

7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

(Doc. 2856 at 1-2).
After not obtaining relief from Judge Humetewa, Defendants turned to the Ninth Circuit.
In one of their pending appeals, Defendants filed a “Motion to Dismiss Appeals for
Lack of Magistrate Judge Jurisdiction.” That motion presented the same arguments and
requested the Ninth Circuit “vacate [Magistrate Judge Duncan’s] rulings and dismiss the
appeals for lack of magistrate-judge jurisdiction.” (16-17282, Doc. 110). The Ninth
Circuit has not ruled on that motion.
ANALYSIS
Although there is no pending motion regarding jurisdiction, the Court has an
obligation to confirm jurisdiction exists. See, e.g., WMX Techs., Inc. v. Miller, 104 F.3d
1133, 1135 (9th Cir. 1997) (jurisdiction “must” be raised sua sponte). The Court has read
Defendants’ prior filings on the jurisdictional issue and those filings are based on a single
opinion from the Seventh Circuit, Hatcher v. Consolidated City of Indianapolis, 323 F.3d
513 (7th Cir. 2003). A careful analysis of that case shows it has no application to the
present situation and that Magistrate Judge Duncan had jurisdiction.
Plaintiff Lee Hatcher obtained a jury verdict of approximately $19,000 against the
City of Indianapolis and several individuals. Id. at 514. That verdict prompted crossappeals by the parties as well as a motion for attorneys’ fees by Hatcher. The District Judge
did not immediately rule on that motion. While the cross-appeals were pending, the parties
settled. The parties’ settlement agreement provided “for a $100,000 payment to Hatcher

-4-

1

and his attorneys” but went on to state the “legal fees claimed by [various lawyers] . . .

2

would be referred to Magistrate V. Sue Shields for mediation and resolution.” Id. at 514.

3

The parties “advised” the District Judge of their settlement and the District Judge “seemed

4

to endorse the referral to a named magistrate judge.” Id. at 515. The Magistrate Judge set

5

a briefing schedule but, without any explanation, the District Judge ruled on the motion for

6

attorneys’ fees and awarded Hatcher some, but not all, of his requested costs and fees. Id.

7

Neither side was pleased with the District Judge’s order and the previously filed cross-

8

appeals became solely about the awards of costs and fees.

9

Hatcher presented two arguments on appeal. First, Hatcher believed the District

10

Judge had erred by ruling on the motion for fees given the language in the parties’

11

settlement agreement designating the Magistrate Judge would decide that issue. Second,

12

Hatcher argued even if the District Judge had been authorized to resolve the fees issue, the

13

amount awarded was too low. The Seventh Circuit concluded it did not need to “delve too

14

deeply into the merits of the [amount of the] award” because “the district court never should

15

have ruled on the fee petitions in the first place.” Id. To explain that conclusion, the

16

Seventh Circuit went into great detail about the parties’ ill-fated attempt to have a particular

17

judicial officer resolve the fees issue.

18

The Seventh Circuit began its analysis by holding the parties had validly consented

19

to referring the case to a Magistrate Judge. The written settlement agreement was sufficient

20

evidence of the parties’ consent to the Magistrate Judge hearing the case and “the district

21

court acknowledged that the reference was being made when he told the parties that he

22

would give Magistrate Judge Shields a ‘heads up’ on the matter.” Id. at 516. Thus, the

23

Seventh Circuit believed there had been a valid referral to the Magistrate Judge. Despite

24

the existence of that valid referral, the Seventh Circuit reasoned there was a “problem”

25

with the parties “consenting only to referral to a specific named magistrate judge whom

26

the parties have handpicked.” Id.

27

The “problem” with the parties’ attempt to have a specific Magistrate Judge resolve

28

the fees motion was that “parties are not permitted to select their own judges in cases in

-5-

1

federal court.” Id. at 517. And “the degree of specificity the parties sought in this case is

2

inconsistent with the role of magistrate judges as federal judicial officers.” Id. at 516. The

3

Seventh Circuit believed “the parties [had] attempted to override the district court’s

4

assignment protocol and [] substitute their own chosen magistrate.” Id. at 518. The

5

governing statutes allegedly indicated “that magistrate judge assignment is a matter for the

6

court to decide, not the parties.” Id. Thus, only “the court, and not the parties, [] has the

7

power to confer general or specific duties upon an individual magistrate judge.” Id.

8

Based on the parties’ allegedly improper attempt to select Magistrate Judge Shields,

9

the Seventh Circuit remanded for the district court to determine if the parties’ settlement

10

agreement had meant to allow any Magistrate Judge resolve their remaining disputes. In

11

that situation, the reference would be permissible and a Magistrate Judge, presumably

12

selected at random, could resolve the issues. If, however, the parties’ intent had been to

13

select only Magistrate Judge Shields, their “consent” was “ineffective” and the district

14

court would have to “reconsider its award of fees and costs.” Id. at 520.

15

The Seventh Circuit’s analysis is contradictory. The Seventh Circuit claimed the

16

parties had “commandeer[ed]” the judge selection process by designating Magistrate Judge

17

Shields. Id. at 518. But the Seventh Circuit’s own recitation of the facts proves it was the

18

District Judge, not the parties, who decided the case should be referred to Magistrate Judge

19

Shields. At the start of its analysis, the Seventh Circuit ruled the parties had validly

20

consented to Magistrate Judge jurisdiction and that the District Judge properly made the

21

referral to the Magistrate Judge. Id. at 515. Accepting that it was the District Judge, not

22

the parties, who made the referral, the remainder of the Seventh Circuit’s analysis falls

23

apart. Assuming the parties attempted to pick Magistrate Judge Shields to hear the fees

24

motion, that attempt would not have come to anything if the District Judge had not

25

consented. In other words, the District Judge could have rejected the parties’ attempt to

26

designate Magistrate Judge Shields. But instead of rejecting the parties’ allegedly improper

27

request for Magistrate Judge Shields, the District Judge ratified it and, in so doing, made it

28

the Court’s determination. Thus, the Seventh Circuit’s conclusion that it was the parties,

-6-

1

not the District Judge, who made the important decision is not accurate.

2

Ignoring the contradictory nature of the Seventh Circuit’s analysis, Defendants

3

focus on the portions of that decision remarking it is improper for parties to try and pick

4

the judicial officer to resolve their disputes. Relying on those portions, Defendants argue

5

the referral of this case to Magistrate Judge Duncan was ineffective such that he lacked

6

“subject matter jurisdiction” to take any actions in this case. Defendants’ argument is

7

premised on a misreading of the record.

8

Defendants’ filings argue the joint motion requesting Judge Humetewa refer the

9

case to Magistrate Judge Duncan was equivalent to what occurred in Hatcher. But similar

10

to the analysis by the Seventh Circuit, Defendants have not explained why it is their joint

11

motion–and not Judge Humetewa’s decision–that is important. It is undisputed that Judge

12

Humetewa could have denied the parties’ request to refer the case to Magistrate Judge

13

Duncan. In fact, Judge Humetewa denied a portion of the motion regarding which other

14

judge would handle mediations with the parties. Thus, it is inaccurate to describe the

15

referral to Magistrate Judge Duncan as taking place because of the parties’ selection of

16

him. The more accurate view is that the referral occurred because of Judge Humetewa’s

17

order.1 And Defendants have not identified any flaw in Judge Humetewa’s order. That is,

18

Defendants have not explained how Judge Humetewa’s direct assignment of this matter to

19

Magistrate Judge Duncan conflicts with the statement in Hatcher “that magistrate judge

20

assignment is a matter for the court to decide, not the parties.” 323 F.3d at 518. In short,

21

Defendants’ reliance on Hatcher is based on a simple misunderstanding of how the referral

22

to Magistrate Judge Duncan actually occurred.

23

Finally, even assuming there were some flaw in the way in which the case ended up

24

before Magistrate Judge Duncan, Defendants have not explained how that flaw meant

25
1

26
27
28

By way of example, parties routinely file joint motions seeking extensions of time
regarding discovery deadlines. When presented with such a joint motion, a judge must
decide whether to grant or deny the extension. If a judge grants the motion, it would be
quite strange to complain the parties have “commandeered” the judicial scheduling
process. Yet that seems to be how the Seventh Circuit would view things given its concern
that an attempt to designate a particular Magistrate Judge, subject to approval by the
District Judge, constituted an inappropriate invasion of the judicial role.
-7-

1

Magistrate Judge Duncan was proceeding without subject matter jurisdiction. The facts in

2

Hatcher did not involve any actions by the designated Magistrate Judge. Thus, even if this

3

Court were to accept Hatcher entirely, it does not follow that Magistrate Judge Duncan

4

lacked jurisdiction. Hatcher simply does not address what should occur when a Magistrate

5

Judge takes actions despite some flaw in the way in which the case came before him. There

6

is no authority suggesting that the necessary or appropriate result would be to vacate

7

Magistrate Judge Duncan’s nearly four years of rulings. And available Supreme Court

8

authority indicates Defendants waited far too long to complain.

9

In Roell v. Withrow, two defendants had never explicitly consented to proceeding

10

before a Magistrate Judge. 538 U.S. 580 (2003). Nor had the two defendants ever objected.

11

Instead, they participated in the litigation before the Magistrate Judge, all the way up

12

through a jury trial and verdict. Id. at 583. It was only on appeal that the defendants’ lack

13

of explicit consent was noticed. Id. The Fifth Circuit eventually ruled consent to

14

Magistrate Judge jurisdiction “cannot be implied by the parties’ conduct.” Id. at 585. Thus,

15

the litigation had to start anew. The issue for the Supreme Court was whether the Fifth

16

Circuit was correct.

17

The Supreme Court’s analysis turned, in large part, on the language of the statute

18

governing Magistrate Judge jurisdiction and how parties consent to proceeding before a

19

Magistrate Judge. Under 28 U.S.C. § 636(c)(1), “[u]pon the consent of the parties,” a

20

Magistrate Judge “may conduct any or all proceedings in a jury or nonjury civil matter and

21

order the entry of judgment in the case.” Under 28 U.S.C. § 636(c)(2), the decision of the

22

parties whether to proceed before a Magistrate Judge “shall be communicated to the clerk

23

of court.” The Supreme Court interpreted these provisions as “envision[ing] advance,

24

written consent communicated to the clerk.” Roell, 538 U.S. at 586. But the Supreme

25

Court believed a party might “signal[] consent to the magistrate judge’s authority through

26

actions rather than words.” Id. at 589. And that type of consent is no less valid than the

27

preferred “advance, written consent.” According to the Supreme Court, “a defect in the

28

referral to a full-time magistrate judge under § 636(c)(2) does not eliminate that magistrate

-8-

1

judge’s ‘civil jurisdiction’ under § 636(c)(1) so long as the parties have in fact voluntarily

2

consented.” Id. at 587. The Supreme Court noted that any other conclusion would create

3

a serious risk of “gamesmanship” where a party could sit back and await “the outcome

4

before denying the magistrate judge’s authority.” Id. at 590. Accordingly, the actions by

5

the two defendants constituted implicit consent and they were bound by the verdict

6

obtained before the Magistrate Judge.

7

Based on Roell, Defendants had years and years to object to Magistrate Judge

8

Duncan’s exercise of jurisdiction. They did nothing. Only after compliance proceedings

9

did not evolve as they hoped did Defendants discover and assert their jurisdictional

10

argument. Defendants appear to be engaged in the type of “gamesmanship” the Supreme

11

Court identified and discouraged. Defendants long ago waived any objection to Magistrate

12

Judge Duncan’s exercise of jurisdiction. Accordingly, Magistrate Judge Duncan had

13

jurisdiction and this case will proceed based on his rulings remaining in place.

14

Notwithstanding the foregoing, and to avoid any future disputes, the parties should

15

be prepared to discuss at the December 6, 2018, status hearing their current positions

16

regarding jurisdiction. In particular, Defendants should be prepared to explain how this

17

case would proceed if the Ninth Circuit were to agree with their position regarding

18

Magistrate Judge Duncan’s jurisdiction. Defendants should also be prepared to explain

19

whether they have any objection to the manner in which this case was reassigned to the

20

undersigned upon Magistrate Judge Duncan’s retirement.

21

IT IS SO ORDERED.

22

Dated this 6th day of December, 2018.

23
24
25

Honorable Roslyn O. Silver
Senior United States District Judge

26
27
28

-9-