Opinion
Civil Action No. 04-1971 (RMC).
March 16, 2005
ORDER
Defendants District of Columbia and Alcoholic Beverage Regulation Administration ("Defendants") move to dissolve an order of this Court entered on December 23, 2004 that enjoined enforcement of a law that prohibited the sale of single containers of beer in a "Targeted Ward 4 Moratorium Zone" pending consideration of the Plaintiffs' allegations of violations of the United States Constitution and the D.C. Home Rule Act. Defendants argue that dissolution is appropriate because the Court lacks subject-matter jurisdiction over the action. Because Defendants have appealed the preliminary injunction to the Court of Appeals, this Court is divested of jurisdiction to consider in parallel a motion for the same relief. The Defendants' motion is denied.
BACKGROUND
Plaintiffs are holders of class A and B liquor licenses in Ward 4 of the District of Columbia. On November 12, 2004, they filed a complaint and moved for a temporary restraining order prohibiting Defendants from enforcing the "Targeted Ward 4 Moratorium Zone," and its related provisions, as provided in Title 1, Section 101(o) of the "Omnibus Alcoholic Beverage Amendment of 2004," D.C. LAW 15-187 (to be codified at D.C. Code § 25-3419(a)-(d)), alleging that it: 1) was not duly enacted and is null and void; 2) denies due process to current license holders; 3) denies equal protection to license holders; and 4) is void for vagueness. These provisions would, inter alia, place a moratorium on the sale of certain single containers of beer, malt liquor, and ale in Ward 4. Memorandum in Support of Motion for Temporary Restraining Order at 2. After a hearing held that same day, the Court issued a TRO that was later extended by agreement of the parties.
In anticipation of oral argument on the motion for a preliminary injunction, the Defendants filed a motion to dismiss or for summary judgment, which was fully briefed. On December 21, 2004, the Court heard oral argument, ruled on the record in open court, and issued a preliminary injunction. The Court found that "Plaintiffs have made a substantial showing of their likelihood of success on the merits of their claim that their class A and class B liquor licenses qualify as `property' — thereby implicating the protections of procedural due process under the Fifth Amendment to the United States Constitution — and that their rights to procedural due process have been violated." December 23, 2004 Preliminary Injunction at 2.
On January 7, 2005, Defendants filed a motion to dissolve the preliminary injunction, acknowledging that the Federal Rules of Civil Procedure "do not expressly mention motions to dissolve preliminary injunctions." Memorandum in Support of Motion to Dissolve Preliminary Injunction ("Motion to Dissolve") at 1 n. 1. As counsel argued during hearings on both the motion for a temporary restraining order and for a preliminary injunction, Defendants maintain that this Court does not have subject-matter jurisdiction because local law issues predominate over issues of federal law. Id. at 3. Defendants then proceed to reargue that Plaintiffs have not adequately stated a claim for violation of constitutional due process. Id. at 5.
Plaintiffs filed their opposition to the motion to dissolve on January 18, 2005. Later that same day, Defendants filed notice of their appeal of the Court's preliminary injunction order. Plaintiffs subsequently filed a surreply, which the Court accepts, arguing that the appeal from the entry of the preliminary injunction divested the Court of control over that aspect of the case. Surreply in Opposition to Motion to Dissolve Preliminary Injunction ("Surreply") at 2.
ANALYSIS
The issue presented is whether a district court may properly entertain a motion to dissolve an interlocutory order that has been appealed. Absent a change in circumstances, the Court finds that it may not.
A preliminary injunction is interlocutory and may be appealed under the statutory exception to the final judgment rule embodied in Section 1292(a)(1) of Title 28. That provision vests the courts of appeals with jurisdiction to review "[i]nterlocutory orders of the district courts . . . granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions. . . ." 28 U.S.C. § 1292; see Nat'l R.R. Passenger Corp. v. Express Trak, L.L.C., 330 F.3d 523, 527 (D.C. Cir. 2003) (finding that 28 U.S.C. § 1292(a)(1) is "typically invoked to appeal preliminary injunctions").
Defendants do not ground their motion to dissolve the preliminary injunction in rule or statute. In a welcome attempt to add clarity, Plaintiffs suggest that Defendants may be proceeding under Rule 54(b) of the Federal Rules of Civil Procedure. Opposition to Motion to Dissolve Preliminary Injunction ("Opposition") at 3. But injunctive orders are generally considered to be outside the scope of Rule 54(b). 11A CHARLES ALAN WRIGHT, ARTHURR. MILLER MARYKAYKANE, FEDERALPRACTICE AND PROCEDURE § 2962 (1995); see Redding Co. v. Russwine Construction Corp., 417 F.2d 721, 726 n. 33 (D.C. Cir. 1969) ("In our view, the requirements of Rule 54(b) do not apply to otherwise appealable collateral orders.").
Absent an appeal, a district court has complete power over its interlocutory orders. Ideal Toy Corp. v. Sayco Doll Corp., 302 F.2d 623, 625 (2d Cir. 1962) (citing John Simmons Co. v. Grier Bros., 258 U.S. 828 (1922)). Accordingly, it is normally within the discretion of the district court to dissolve an injunction where, for example, "changed circumstances eviscerate the justification therefor. . . ." SEC v. Vision Communications, 1995 U.S. Dist. LEXIS 2868, at *6 (D.D.C. March 6, 1995) (citing United States v. Swift Co., 286 U.S. 106 (1932)).
The filing of a notice of appeal, however, confers jurisdiction on the court of appeals and divests the district court of its control over those aspects of the case involved in the appeal. United States v. El-O-Pathic Pharmacy, 192 F.2d 62, 79-80 (9th Cir. 1951) (per curiam); Common Cause v. Judicial Ethics Comm., 473 F. Supp. 1251, 1254 (D.D.C. 1979).
[I]t [is] generally understood that a federal district court and a federal court of appeals should not attempt to assert jurisdiction over a case simultaneously. The filing of a notice of appeal is an event of jurisdictional significance — it confers jurisdiction on the court of appeals and divests the district court of its control over those aspects of the case involved in the appeal.Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 58 (1982); see Sierra Club v. Cedar Point Oil Co., Inc, 73 F.3d 546, 578 (5th Cir. 1996) ("notice of appeal divests the district court of jurisdiction over the judgment or order that is the subject of the appeal"); SEC v. Investors Sec. Corp., 560 F.2d 561, 568 (3d Cir. 1977) (similar). The reasons for this transfer of jurisdiction are prudential and obvious: divestiture of district court jurisdiction avoids the "`confusion and waste of time that might flow from putting the same issues before two courts at the same time.'" In the Matter of Thorp, 655 F.2d 997, 998 (9th Cir. 1981) (citation omitted); c.f. Barnstead Broadcasting Corp. v. Offshore Broadcasting Corp., 869 F. Supp. 35, 37 (D.D.C. 1994) (transfer of jurisdiction is discretionary).
Defendants assert that both the appeal of the preliminary injunction order and its motion to dissolve the preliminary injunction order may proceed on parallel tracks. Perhaps anticipating that the filing of their appeal might raise an objection to reconsideration of the preliminary injunction, Defendants dropped a footnote.
It is generally true that the filing of a notice of appeal "confers jurisdiction on the court of appeals and divests the district court of control over those aspects of the case involved in the appeal." United States v. Defries, 129 F.3d 1293, 1302 (D.C. Cir. 1997). However, because the District's Motion to Dissolve Preliminary Injunction was filed to challenge an interlocutory order, "appellate review may continue uninterrupted." Hoai v. Vo, 935 F.2d 308, 312 (D.C. Cir. 1991), cert. denied, 503 U.S. 967 (1992).
Reply on Motion to Dissolve Preliminary Injunction ("Reply") at 2 n. 1. Such a proposition is too flimsy a reed upon which to support its claim to this relief. The simple fact that the order is interlocutory in nature has no effect on the transfer of jurisdiction to the court of appeals.
Defendants filed a motion to dissolve the preliminary injunction raising no new facts or argument. It would be inadvisable for this Court, absent changed circumstances or a change in the law, to reconsider and dissolve a preliminary injunction issued after due consideration of briefs and arguments where the propriety of its initial determination is also under review by the D.C. Circuit. This is particularly true because dissolution of a preliminary injunction is also subject to appellate review under 28 U.S.C. § 1292(a)(1) and Plaintiffs could appeal any decision by this Court granting the relief Defendants request. This could lead to a highly inefficient result, namely: the Court issues a preliminary injunction; Defendants file an appeal; the Court dissolves the preliminary injunction; the D.C. Circuit remands or otherwise disposes of the appeal; and Plaintiffs subsequently appeal the dissolution. Considerable time and effort would be expended by the parties and the courts but the issue would remain unresolved. Under such circumstances, the Court will deny the motion to dissolve the preliminary injunction.
The district court does retain jurisdiction to act with respect to matters not related to the issues involved in the appeal. Taylor v. Sterrett, 640 F.2d 663, 667-68 (5th Cir. 1981); Burns v. County of Cambria, Pa., 788 F. Supp. 868, 869 (W.D. Pa. 1991). Accordingly, the Court will consider Defendants' Motion to Dismiss or, in the Alternative, for Summary Judgment and Plaintiffs' opposition and will issue a decision in due course.
CONCLUSION
For the reasons stated, the Motion to Dissolve Preliminary Injunction is DENIED.
SO ORDERED.