Opinion
Case No.: 91-0986-CIV-GOLD.
December 14, 2004
THIS CAUSE is before the Court upon Defendant's recently filed Emergency Motion for Stay of Execution on Amended Judgment for Named Plaintiffs Pending Supreme Court Review Incorporated Memorandum of Law [DE # 1765, filed December 10, 2004]. The parties briefly discussed the Emergency Motion during the December 10, 2004 hearing on Plaintiff's Objections to Magistrate Simonton's Report and Recommendation re: Plaintiff's Motions for Injunctions Against Interlopers.
At the hearing, Defendant's counsel explained that Defendant filed theEmergency Motion on an emergency basis because Plaintiffs' counsel indicated that Plaintiffs would begin seizing assets to satisfy the amended judgment on Monday, December 13, 2004. At the hearing, Plaintiffs' counsel stipulated on the record that Plaintiffs agreed not to execute on the judgment until the Court held a hearing and ruled on the Emergency Motion. After Plaintiffs' counsel stipulated that Plaintiffs would wait until this Court issued an order on the Emergency Motion before executing on the judgment, Defendant's counsel agreed that the Emergency Motion need not be resolved on an emergency basis.
Accordingly, it is hereby ORDERED AND ADJUDGED that:
1. A hearing on Defendant Exxon Corporation's Emergency Motion for Stay of Execution on Amended Judgment for Named Plaintiffs Pending Supreme Court Review Incorporated Memorandum of Law [filed December 10, 2004] will take place on January 7, 2004 at 9:00 a.m. at the United States Courthouse, Courtroom Ten, Tenth Floor, 301 N. Miami Avenue, Miami, FL 33128.
DONE AND ORDERED.
ORDER AFFIRMING REPORT AND RECOMMENDATION
THIS CAUSE is before the Court upon Plaintiffs' Objection to Report and Recommendation re: Plaintiffs Motions for Injunctions Against Interlopers [DE # 1730]. Plaintiffs objected to Magistrate Judge Andrea Simonton's Report and Recommendation denying Plaintiffs' Motion for Injunctions Against Interlopers [DE # 1724]. CCB filed a Response [DE # 1739] to Plaintiffs' Objection to the Report. CARG failed to file a response and it has not appeared in this case.After CCB filed its Response, Plaintiffs filed a second Objection to the Report [DE # 1743]. Plaintiffs later amended the title of this second Objection and refiled essentially the same pleading as a Corrected Reply to CCB's Response [DE # 1745]. CCB filed a Motion to Strike the second Objection and the Corrected Reply [DE # 1744] as untimely and procedurally improper. Thereafter, Plaintiffs filed a Motion for Leave to File Reply Memorandum [DE # 1751] nunc pro tunc. CCB then filed a Response to the Motion for Leave to File Reply Memorandum [DE # 1754]. I held a hearing on December 10, 2004 to discuss the Objections and the motions.
I. The Report and Recommendation
On October 28, 2004, Magistrate Simonton issued her Report and Recommendation. In the Report and Recommendation, she recommended denying Plaintiff's Emergency Motion for Injunction Prohibiting Non-Party Interloper' (Claims Compensation Bureau) Misleading Solicitation of Class Members [DE # 1648] and Plaintiff's Second Emergency Motion for Injunction Prohibiting Additional Non-Party (Class Action Recovery Group) From Solicitation of Class Members [DE # 1649]. In the motions, Plaintiffs asked the Court to enter an injunction prohibiting Claims Compensation Bureau ("CCB"), Class Action Recovery Group ("CARG") and any other non-party which later attempted to solicit any of the individual class members to offer their assistance in filing claims in this case without prior approval from the Court. CCB and CARG are two companies which are in the business of helping class members file and process class settlement/verdict claims for a fee. Plaintiffs asked the Court to enter the injunctions pursuant to Fed.R.Civ.P. 23, the All Writs Act, 28 U.S.C. § 1651 and Local Rule 7.1E (local rule allowing for emergency hearings).
Magistrate Simonton concluded that the district court does not have subject matter jurisdiction to enter the injunctions requested by Plaintiffs under Fed.R.Civ.P. 23 or the All Writs Act. With regard to Rule, 23, Magistrate Simonton noted that the Eleventh Circuit has made clear that Rule 23 does not grant a district court subject matter jurisdiction to enjoin a non-party from contacting class members. See In re: Infant Formula Antitrust Litigation, 72 F.3d 842, 842-43 (11th Cir. 1995) (R R at 11).
Magistrate Simonton also concluded that the district court does not have subject matter jurisdiction to enter the injunction under the All Writs Act, 28 U.S.C. § 1651. (See R R at 11-19). The All Writs Act simply pronounces: "The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law." Magistrate Simonton cited Syngenta Crop Protection, Inc. v. Henson, 537 U.S. 28 (2002), a recent U.S. Supreme Court case which established that the All Writs Act does not create subject matter jurisdiction; subject matter jurisdiction must exist independently of the All Writs Act. (R R at 12). Further, Magistrate Simonton cited Eleventh Circuit case law which establishes that a district court may only issue an injunction under the All Writs Act when the injunction is necessary for the court to discharge its duties or protect its jurisdiction. See Klay v. United Healthgroup, Inc., 376 F.3d 1092 (11th Cir. 2004); see also Rosen v. Cascade Int'l, Inc., 21 F.3d 1520, 1526-27 (11th Cir. 1994); ITT Comm'ty Dev't Corp. v. Barton, 569 F.2d 1351, 1359-60 (5th Cir. 1978).
Magistrate Simonton concluded that an injunction prohibiting CCB, CARG and all other non-party claims assistance companies from contacting class members is not necessary for the Court to enforce its jurisdiction because the non-parties' actions neither interfere with any prior orders of the Court nor affect the Court's ability to give full relief to the class members. Magistrate Simonton also concluded that Plaintiffs have not shown any irreparable harm justifying an injunction because any damages the class members might suffer would only be monetary. Moreover, in the Report and Recommendation, Magistrate Simonton found that "the communications from CCB and CARG do not misstate the District Court's orders". (R R at 17). The Report recommended denying the request for injunctions because the Court does not have subject matter jurisdiction to enter the injunctions under either Fed.R.Civ.P. 23 or the All Writs Act.
I find that Magistrate Simonton's conclusions that the solicitations were not misleading and did not misrepresent this Court's prior orders to be dicta. Accordingly, the issue of whether the solicitations are misleading or misrepresentative may be reasserted at a later time.
II. The Objections
Plaintiffs filed their Objections to the Report and Recommendation [DE # 1730] on October 13, 2004. In the Objections, Plaintiffs concede that Magistrate Simonton correctly stated the applicable facts and the legal standard. Rather, Plaintiffs' object that Magistrate Simonton incorrectly applied the law to the facts in recommending that the request for the injunctions be denied.
Plaintiffs object to Magistrate Simonton's conclusion that the district court does not have subject matter jurisdiction over CCB and CARG. Plaintiffs maintain that the district court has jurisdiction over these two entities because their actions interfere with the Court's prior orders by frustrating the claims administration process established by the Court in prior orders. Further, Plaintiffs argue that Magistrate Simonton erred in concluding that CCB and CARG's solicitations contained false and misleading information that Defendant is paying claims under a settlement and that CCB and CARG can represent the class members' interests in the claims administration process.
In the objections, Plaintiffs fail to raise any objection to Magistrate Simonton's conclusion that there is no subject matter jurisdiction for the requested injunction under Rule 23. Plaintiffs only object to Magistrate Simonton's conclusion that the district court does not have subject matter jurisdiction under the All Writs Act. Consequently, I adopt and affirm the Report and Recommendation that I do not have subject matter jurisdiction to enter the requested injunctions under Rule 23.
III. The Hearing
Counsel for Plaintiffs, counsel for CCB and counsel for Defendant appeared at the hearing. No one appeared at the hearing on behalf of CARG. During the hearing, counsel for Plaintiffs acknowledged that there is no longer any need for the Court to enter any injunctions because the deadline for class members to file claims has passed in this case. Accordingly, Plaintiffs' counsel withdrew its request for the injunctions. Although Plaintiffs' counsel conceded that their request for entry of injunctions is now moot, I agree with Magistrate Simonton's conclusion that I do not have subject matter jurisdiction to enter the injunctions requested by Plaintiffs in any event.
At the hearing, Plaintiffs' counsel raised additional concerns that allowing non-party claims assistance companies such as CCB and CARG to solicit class members may result in disputes between the class members and these companies. Plaintiffs suggested that these disputes will result in the disruption of the claims administration process established by the Court in this case. Counsel for CCB challenged Plaintiffs' concerns that CCB's actions may interfere with the claims administration process.
CCB's counsel informed the Court that no disputes between any class members and CCB have arisen to date. In addressing what would happen if any dispute between CCB and a class member should arise, CCB's counsel conceded to the personal jurisdiction of the district court over CCB to hear the dispute. Although counsel for CCB stipulated in open court that CCB is subject to personal jurisdiction in this Court, I would have found that this Court had personal jurisdiction over CCB in any event.
After counsel for CCB acquiesced to the Court's jurisdiction, the parties agreed to a procedure for handling any disputes between class members and CCB should any such dispute arise. Both counsel for Plaintiffs and counsel for CCB agreed that all disputes between class members and CCB will be raised before the Special Master. The Special Master will hear the dispute and make a recommendation to the Court. The parties also agreed that if any disputes between a class member and Defendant should arise regarding who is entitled to make a claim, that dispute should raised before the Special Master. The Special Master will also hear this dispute and make a recommendation to the Court.
IV. Standard of Review of Magistrate's Report and Recommendation
Both 28 U.S.C. § 636 and the Local Rules of the United States District Court for the Southern District of Florida, Magistrate Judge Rule 4(b) provide that any party may object to a Magistrate Judge's proposed findings, recommendations or report. In reviewing a Magistrate Judge's proposed findings and recommendations, a district court judge "shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made." 28 U.S.C. § 636(b)(1); see also Mag J Rule 4(b) (stating that a "District Judge shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made and may accept, reject, or modify, in whole or in part, the findings or recommendations made by the Magistrate Judge."); United States v. One Piece of Real Property Located at 5800 SW 74th Ave., Miami, Fla., 363 F.3d 1099, 1103 (11th Cir. 2004) (instructing that the district court must make a de novo review of the objections to a magistrate's recommendation).
V. Analysis
I have conducted a de novo review of the portion of Magistrate White's Report and Recommendation to which Plaintiffs have objected and find no error. Plaintiffs have objected to the Report and Recommendation on the grounds that Magistrate Simonton incorrectly applied the facts of this case to the law in concluding that the district court does not have subject matter jurisdiction under the All Writs Act to enter injunctions against CCB, CARG and other non-party claims assistance companies. Magistrate Simonton's conclusion is correct, this Court does not have subject matter jurisdiction under the All Writs Act to enter the requested injunctions in this case.
The All Writs Act, 28 U.S.C. § 1651, allows district courts to "issue all writs necessary or appropriate in aid of their respective jurisdictions." In 2002, the United States Supreme Court made clear that the All Writs Act does not create independent jurisdiction for district courts. Syngenta Crop Protection, Inc. v. Henson, 537 U.S. 28, 29 (2002). The Eleventh Circuit recently analyzed the issue of a court's ability to issue an injunction under the All Writs Act. In Klay v. United Healthgroup, Inc., 376 F.3d 1092 (11th Cir. 2004), the Eleventh Circuit concluded that a court may issue an injunction under the All Writs Act if the injunction is necessary for the court to discharge its duties or protect its jurisdiction. See also Rosen v. Cascade Int'l, Inc., 21 F.3d 1520, 1526-27 (11th Cir. 1994); ITT Comm'ty Dev't Corp. v. Barton, 569 F.2d 1351, 1359-60 (5th Cir. 1978). The injunctions requested by Plaintiffs are not necessary for this Court to discharge its duties or to protect its jurisdiction.
Plaintiffs have not articulated a valid basis for how CCB, CARG or any other non-party claims assistance companies' actions interfered with the Court's prior orders or the Court's ability to enter final judgment in this case. Plaintiffs vaguely assert that this Court's earlier orders establishing the class administration process do not account for the presence of non-parties, therefore, allowing these non-parties to solicit class members will result in confusion and frustration of the efficient administration of the claims process. (Objections at 13). Plaintiffs also argue that this Court should issue the injunctions to prevent the third party claimants from unfairly receiving a "substantial portion of class members' hard fought recovery". (Objections at 9).
A district court can only issue an injunction under the All Writs Act if is necessary for the court to discharge its duties or protect its jurisdiction. Klay, 376 F.3d 1092 (11th Cir. 2004). Plaintiffs have failed to show how the actions of the non-party claims assistance companies neither prevent the Court from discharging its duties. Further, Plaintiffs have failed to establish that the Court's jurisdiction is threatened, therefore, there is no need for the Court to enjoin the actions of the non-party claims assistance companies. Id.
Moreover, class members are free to enter into a contract with one of these non-party claims assistance companies in order to assist them in filing claims. If the class members develop a problem with any of these companies, the class members have an adequate remedy at law available to them — they may seek relief against these companies by filing their own lawsuits. As the All Writs Act does not create subject matter jurisdiction where there is none and there are no orders which this Court must enforce that are threatened by the non-party claims assistance companies, Magistrate Simonton was correct in finding that subject matter jurisdiction does not exist in this case. Syngenta Crop Protection, Inc. v. Henson, 537 U.S. 28 (2002).
Accordingly, it is hereby ORDERED AND ADJUDGED:
1. Magistrate Simonton's Report and Recommendation [DE # 1724] is hereby ADOPTED and AFFIRMED. Plaintiff's Emergency Motion for Injunction Prohibiting Non-Party Interloper' (Claims Compensation Bureau) Misleading Solicitation of Class Members [DE # 1648] and Plaintiff's Second Emergency Motion for Injunction Prohibiting Additional Non-Party (Class Action Recovery Group) From Solicitation of Class Members [DE # 1649] are BOTH DENIED.
2. This Court has personal jurisdiction over CCB and CARG.
3. If a dispute arises between Defendant and any class member as to the class member's entitlement to make a claim during the claims administration process, Defendant Exxon shall raise this dispute with the Special Master. The Special Master will hear the dispute and will then make findings of fact and recommendations to this Court regarding the disposition of the matter.
4. If any class member who contracts with CCB, CARG or any other non-party claims assistance company disputes how the final payment to the class member should be made, the class member shall raise this dispute with the Special Master. The Special Master will hear the dispute and will then make findings of fact and recommendations to this Court regarding the disposition of the matter.
5. CCB's Motion to Strike Plaintiff's second Objection and Corrected Reply [DE # 1744] is DENIED. Further, Plaintiffs' Motion for Leave to File Reply Memorandum [DE # 1751] nunc pro tunc is also DENIED.
DONE AND ORDERED.