Opinion
1:24-cv-00016-JPH-MKK
12-12-2024
IVF CRYO LLC, Plaintiff, v. H&W HOLDCO LLC, BRIAN HOFF, Defendants. BRIAN HOFF, H&W HOLDCO LLC, Counter Claimants, v. IVF CRYO LLC, Counter Defendant.
ORDER REGARDING STIPULATION OF DISMISSAL
James Patrick Hanlon United States District Judge
The parties have filed a stipulation of dismissal that would dismiss this case with prejudice "with the understanding that this Court will retain jurisdiction for the sole purpose of enforcing the terms of the Settlement Agreement." Dkt. 49.
Ordinarily, a case resolved in federal court with a settlement agreement is dismissed with prejudice and any necessary enforcement is accomplished through a breach-of-contract action. See Jones v. Assoc. of Flight Attendants- CWA, 778 F.3d 571, 573 (7th Cir. 2015) ("A disagreement about whether parties to settlement have honored their commitments is a contract dispute."). Such an action arises under state law and therefore "cannot be adjudicated in federal court unless there is an independent basis of subject-matter jurisdiction, such as diversity." Id.
There is "an exception . . . for settlements embodied in a consent decree or some other judicial order" under Federal Rule of Civil Procedure 65, or if "jurisdiction to enforce the agreement is retained." Id.; see Blue Cross and Blue Shield Ass'n v. Am. Express Co., 467 F.3d 634, 636 (7th Cir. 2006). But "a district judge cannot dismiss a suit with prejudice, thus terminating federal jurisdiction, yet at the same time retain jurisdiction to enforce the parties' settlement that led to the dismissal with prejudice." Shapo v. Engle, 463 F.3d 641, 643 (7th Cir. 2006); see Depuy v. McEwen, 495 F.3d 807, 809 (7th Cir. 2007).
The parties therefore shall have through January 10, 2025 to show cause why the Court should retain jurisdiction over the settlement agreement. See H.A.L. NY Holdings, LLC v. Guinan, 958 F.3d 627, 635 (7th Cir. 2020) ("A federal court is most certainly not a recorder of contracts but an organ of government charged with the exercise of federal power."). If they do not respond, the Court will acknowledge the stipulation of dismissal with prejudice without retaining jurisdiction, allowing the settlement agreement to be enforced, if necessary, in a breach-of-contract action. See Jones, 778 F.3d at 573.
SO ORDERED.