Gelboim v. Bank of Am. Corp., 574 U.S. 405 (2015)
The London InterBank Offered Rate (LIBOR) is a reference point in determining interest rates for financial instruments in the U.S. and globally. The Judicial Panel on Multidistrict Litigation (JPML) established a multidistrict litigation for cases alleging that banks understated their borrowing costs, depressing LIBOR and enabling the banks to pay lower interest rates on financial instruments sold to investors. Over 60 actions were consolidated, including the Gelboim class action, which raised a single claim that banks, acting in concert, had violated federal antitrust law. The district court dismissed all antitrust claims and granted certifications under Rule 54(b), which authorizes parties with multiple-claim complaints to immediately appeal dismissal of discrete claims. The Second Circuit dismissed the Gelboim appeal because the order appealed from did not dispose of all of the claims in the consolidated action. A unanimous Supreme Court reversed. The order dismissing their case in its entirety removed Gelboim from the consolidated proceeding, triggering their right to appeal under 28 U.S.C. 1291, which gives the courts of appeals jurisdiction over appeals from “all final decisions of the district courts.” Because cases consolidated for MDL pretrial proceedings ordinarily retain their separate identities, an order disposing of one of the discrete cases in its entirety qualifies under section 1291 as an appealable final decision. The JPML’s authority to transfer civil actions for consolidated pretrial proceedings, 28 U.S.C. 1407, refers to individual “actions,” not to a monolithic multidistrict “action” and indicates Congress’ anticipation that, during pretrial proceedings, final decisions might be rendered in one or more of the consolidated actions. The Gelboim plaintiffs are no longer participants in the consolidated proceedings.
When claims are consolidated into a single proceeding, the dismissal of one of the claims in its entirety is an appealable final decision by a district court under 28 U.S.C. 1291, even if the entire consolidated proceeding was not dismissed. This is because the party whose claim was dismissed is no longer part of the proceeding, and decisions to dismiss claims may qualify as final even if they happen before trial.
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U.S. 321, 337.
SUPREME COURT OF THE UNITED STATES
gelboim et al. v. bank of america corp. et al.
certiorari to the united states court of appeals for the second circuit
No. 13–1174. Argued December 9, 2014—Decided January 21, 2015
Three legal prescriptions figure in this case. Title 28 U. S. C. §1291 gives the courts of appeals jurisdiction over appeals from “all final decisions of the district courts of the United States,” and its core application is to rulings that terminate an action. Federal Rule of Civil Procedure 54(b) permits district courts to authorize immediate appeal of dispositive rulings on separate claims in a civil action raising multiple claims. And 28 U. S. C. §1407 authorizes the Judicial Panel on Multidistrict Litigation (JPML) to transfer civil actions “involving one or more common questions of fact . . . to any district for coordinated or consolidated pretrial proceedings” in order to “promote the just and efficient conduct of such actions,” §1407(a).
The London InterBank Offered Rate (LIBOR) is a reference point in determining interest rates for financial instruments in the United States and globally. The JPML established a multidistrict litigation (LIBOR MDL) for cases involving allegations that defendant-banks understated their borrowing costs, thereby depressing LIBOR and enabling the banks to pay lower interest rates on financial instruments sold to investors. Over 60 actions were consolidated for pretrial proceedings in the U. S. District Court for the Southern District of New York, including a class action filed by petitioners Ellen Gelboim and Linda Zacher, who raised the single claim that several banks, acting in concert, had violated federal antitrust law. Determining that no plaintiff could assert a cognizable antitrust injury, the District Court granted the banks’ motion to dismiss all antitrust claims, including the Gelboim-Zacher complaint’s sole claim. The District Court thus dismissed the Gelboim-Zacher complaint, denied leave to amend, and dismissed the case in its entirety. Other cases made part of the LIBOR MDL, however, presented discrete claims which remained before the District Court. Assuming that the Gelboim-Zacher plaintiffs were entitled to an immediate appeal of right under §1291, the District Court granted Rule 54(b) certifications authorizing the plaintiffs in some of the multiple-claim actions to appeal the dismissal of their antitrust claims while their other claims remained pending in the District Court. On its own initiative, the Second Circuit dismissed the Gelboim-Zacher appeal because the order appealed from did not dispose of all of the claims in the consolidated action. The District Court thereafter withdrew its Rule 54(b) certifications.
Held: The order dismissing their case in its entirety removed Gelboim and Zacher from the consolidated proceeding, thereby triggering their right to appeal under §1291.
Because cases consolidated for MDL pretrial proceedings ordinarily retain their separate identities, an order disposing of one of the discrete cases in its entirety should qualify under §1291 as an appealable final decision. Section 1407 refers to individual “actions” transferrable to a single district court, not to a monolithic multidistrict “action” created by transfer. See Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26, 37. And §1407(a)’s language—“at or before the conclusion of . . . pretrial proceedings,” each transferred action must be remanded to the originating district “unless [the action] shall have been previously terminated”—indicates Congress’ anticipation that, during the pendency of pretrial proceedings, final decisions might be rendered in one or more of the actions consolidated pursuant to §1407. The District Court’s order dismissing the Gelboim-Zacher complaint was a final decision. The District Court completed its adjudication of petitioners’ complaint and terminated their action. Petitioners thus are no longer participants in the consolidated proceedings. Nothing about the initial consolidation of their civil action with other LIBOR MDL cases renders the dismissal of their complaint tentative or incomplete.
To hold, as the banks contend, that no appeal of right accrues until a §1407 consolidation ends would leave plaintiffs like Gelboim and Zacher in a quandary about the event that triggers the 30-day period for taking an appeal. The sensible solution to the appeal-clock trigger is to allow an immediate appeal in a case such as this, where the transferee court in an MDL grants a defendant’s dispositive motion on every claim (or the sole claim) in a transferred case. The banks are also concerned about allowing plaintiffs with the weakest cases to appeal because their complaint states only one claim, while leaving those with stronger cases unable to appeal simultaneously because they have other pending claims. But that concern is attended to by Rule 54(b), which authorizes district courts to grant certifications to parties with multiple-claim complaints, thereby enabling plaintiffs in actions that have not been dismissed in their entirety to pursue immediate appellate review of discrete claims. The District Court did that in this very case. Rule 54(b), however, is of no avail to Gelboim and Zacher, who asserted only one claim. See Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 435. Section 1292(b)—which allows district courts to designate for review certain interlocutory orders—is also inapposite here, for there is nothing “interlocutory” about the dismissal order in the Gelboim-Zacher action. Pp. 6–10.
Reversed and remanded.
Ginsburg, J., delivered the opinion for a unanimous Court.