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IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF VIRGINIA


CHARLOTTESVILLE DIVISION

BRENNAN M. GILMORE, CASE NO.: 3:18-cv-00017-NKM-JCH

Plaintiff

v.

ALEXANDER JONES, et al., REPLY BRIEF IN SUPPORT OF THE


JOINT MOTION TO RECONSIDER
Defendants THIS COURTS’ FINDING OF
PERSONAL JURISDICTION OR TO
CERTIFY THE QUESTION FOR
INTERLOCUTORY APPEAL, FILED
BY DEFENDANTS WILBURN,
HICKFORD, HOFT, CREIGHTON,
AND WORDS-N-IDEAS, LLC

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TABLE OF CONTENTS

Table of Authorities iii

Introduction 1

I. Subsequent Caselaw Has Shown that This Court Committed Clear Error by Failing to
Independently Weigh Whether the Long-Arm Statute Had Been Satisfied 1

A. This Court Clearly Erred by Ignoring the Language of Virginia’s Long-Arm Statute
2

B. This Court Can Reconsider Its Decision in Light of Mercer v. MacKinnon 9

II. The Plaintiff Has Failed to Show Any Reason Why This Court Should Not, in the
Alternative, Certify the Issue of Personal Jurisdiction for Interlocutory Appeal 12

A. A Favorable Decision in the Fourth Circuit Would Materially Advance the Ultimate
Termination of the Litigation for the Undersigned Defendants 12

1. Section 1292(b)’s Material Advancement Clause Does Not Require the


Possibility of Complete Termination of the Litigation 13

2. This Court Should Find That the Material Advancement Clause has been
Satisfied for the Undersigned Defendants Because They Have Been
Misjoined 15

3. This Court Can Find that the Material Advancement Requirement is


Satisfied With or Without a Stay 16

B. Personal Jurisdiction is a Controlling Question of Law 17

1. There is No Factual Dispute, Therefore the Question of Personal


Jurisdiction Is Purely One of Law 17

2. The Question of Jurisdiction is Controlling for These Undersigned


Defendants 18

C. There is Substantial Ground for Difference of Opinion 22

Conclusion 24

ii

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TABLE OF AUTHORITIES

CASES

Atrion Networking Corp. v. Marble Play, LLC, 31 F. Supp.3d 357 (D. R.I. 2014) 20

Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez, 305 F.3d 120 (2nd Cir. 2002) 3

Bergaust v. Flaherty, 57 Va. App. 423 (2011) 10

Blue Ridge Bank v. Veribanc, Inc., 755 F.2d 371 (4th Cir. 1985) 5

Bussing v. Cor Clearing, LLC, No. 8:12-CV-238 (D. Neb. July 17, 2014) 20

Cement Antitrust Litigation (MDL No. 296), In re, 673 F.2d 1020 (9th Cir. 1981) 21

Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm’n, No. CCB-06-
2773 (D. Md. June 29, 2015) 21

Cossart v. United Excel Corp., 804 F. 3d 13 (1st Cir. 2015) 3

D & R Global Selections, S.L. v. Bodega Olegario Falcon Pineiro, 29 N.Y.3d 292 (2017) 3

Dorato v. Smith, 163 F. Supp.3d 837 (D. N.M. 2015) 21

Edwards v. Schwartz, No. 7:18-cv-378 (W.D. Va. March 20, 2019) 23

English & Smith v. Metzger, 901 F.2d 36 (4th Cir. 1990) 6-7

Fannin v. CSX Transp., Inc., 873 F.2d 1438 (4th Cir. 1989) 19

Felts v. Volvo Grp. N. Am., LLC, No. 7:17-cv-00297 (W.D. Va. Aug. 17, 2018) 10

First American First v. National Ass’n of Bank Women, 802 F.2d 1511 (4th Cir. 1986) 5

Gaston v. LexisNexis Risk Sols., NO. 5:16-cv-9 (W.D. N.C. Nov. 13, 2017) 21

Government of Virgin Islands v. Blake, 944 F. Supp. 434 (D. V.I. 1996) 20

Headhunter, LLC v. Doe, No. 5:17-cv-00069 (W.D. Va. Sept. 21, 2018) 15-16

In re Lupron Marketing and Sales Practices Lit., 313 F. Supp.2d 8 (D. Mass. 2004) 20

Johnson v. Burken, 930 F.2d 1202 (7th Cir. 1991) 20

Katz v. Carte Blanche Corporation, 496 F.2d 747 (3rd Cir. 1974) 19-21

Kell v. Crowther, No. 2:07-CV-00359-CW (D. Utah Feb. 8, 2018) 20

iii

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Kopff v. Battaglia, 425 F. Supp. 2d 76 (D.D.C. 2006) 8

Krantz v. Air Line Pilots Ass’n, Intern., 245 Va. 202 (1993) 10

LaFleur v. Dollar Tree Stores, Inc., No. 2:12-CV-00363, 2014 WL 2121721 (E.D. Va. May 20,
2014) 21

Legard v. EQT Production Co., 771 F. Supp. 2d 607 (W.D. Va. 2011) 8 and 10

Louis v. Flagship Airlines, Inc., No. 98-1753, 181 F.3d 79, 1999 WL 525947 (1st Cir. Feb. 5, 1999)
3

Lynn v. Monarch Recovery Mgmt., Inc., 953 F. Supp. 2d 612 (D. Md. 2013) 21

Mackey v. Compass, 391 Md. 117, 892 A.2d 479 (2006) 8

Mercer v. MacKinnon, No. 180358 (Va. S. Ct. Feb. 21, 2019) passim

Muller v. Temura Shipping Co., 629 F. Supp. 1024 (E.D. Pa. 1986) 13

Navajo Nation, Corp. v. Urban Outfitters, Inc., No. 12-195 LH/LAM (D. N.M. Feb. 12, 2015)
20

N.C. Elec. Membership v. Carolina Power & Light, 666 F.2d 50 (4th Cir. 1981) 14 and 19

New York Football Giants, Inc. v. Commissioner, 85 T.C.M. 810 (T.C. 2003) 20

Planet Aid, Inc. v. Reveal, No. GLR-16-2974 (D. Md. June 26, 2017) 23

Ratzlaf v. United States, 510 U.S. 135 (1994) 13 and 18

Schmalfeldt v. Grady, et. al., No. 4:17-cv-01310-RBH-KDW (D. S.C. Dec. 7, 2017) (Schmalfeldt
II) 22

Schmalfeldt v. Johnson, et. al., No. 15-CV-1516 (E.D. Wis. July 1, 2016) (Schmalfeldt I) 22

Stover v. O’Connell Assocs., Inc., 84 F.3d 132 (4th Cir. 1996) 6-8

Strebe v. Kanode, No. 7:17cv00321 (W.D. Va. Nov. 21, 2018) 11

St. Clair v. Righter, 250 F. Supp. 148 (W.D. Va. 1966) 6

U.S. v. Ups Customhouse Brokerage, Inc., 464 F. Supp.2d 1364 (Ct. Int'l Trade 2006) 20

Virginia ex rel. Integra REC LLC v. Countrywide Sec. Corp., No. 3:14cv706 (E.D. Va. June 3,
2015) 20

Willis v. Semmes, Bowen & Semmes, 441 F. Supp. 1235 (E.D. Va. 1977) 5

iv

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Young v. New Haven Advocate, 315 F.3d 256 (4th Cir. 2002) 6-8, 10 and 17

CONSTITUTIONAL PROVISIONS, STATUTES AND RULES

U.S. Const. Amend. 14, § 1, cl. 3 passim

28 U.S.C. § 1292 passim

VA CODE § 8.01-328.1 passim

MD CODE CTS. & JUD. PROC. § 6-103 7

D.C. CODE § 13–423 8

Fed. R. Civ. P. 20 16

Fed. R. Civ. P. 21 20

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INTRODUCTION

As a preliminary matter, by presenting this Reply, Mr. Wilburn, Ms. Hickford, Mr. Hoft,

Mr. Creighton, and Words-N-Ideas, LLC (the “Undersigned Defendants”) do not waive any rights

of jurisdiction, notice, process, joinder, or venue. The Undersigned Defendants continue to support

and join the arguments made by Defendants McAdoo, Jones, Free Speech Systems, LLC and

Infowars, LLC (the “Free Speech Defendants”) in their “Motion for Reconsideration or

Certification For Interlocutory Appeal of the Court’s March 29 Order and Opinion” and

accompanying brief in support (Dkts. 133 and 133-1, respectively) and their “Reply in Support of

Motion for Reconsideration or Certification For Interlocutory Appeal of the Court’s March 29

Order and Opinion” (Dkt. 147). The Undersigned Defendants will focus on defending their own

arguments in this Reply.

The Plaintiff has presented no plausible argument why this Court should not reconsider its

March 29, 2019, Order and Opinion finding personal jurisdiction by ignoring the specific language

of Virginia’s long-arm statute VA CODE § 8.01-328.1 or why it should not certify this question for

interlocutory appeal. Subsequent developments in the law have shown that this Court has made a

clear error in finding that personal jurisdiction exists. Alternatively, even if this Court was not

willing to reconsider this issue, this Court can and should certify the issue for interlocutory appeal.

I.
SUBSEQUENT CASELAW HAS SHOWN THAT THIS COURT COMMITTED CLEAR
ERROR BY FAILING TO INDEPENDENTLY WEIGH WHETHER THE LONG-ARM
STATUTE HAD BEEN SATISFIED

The Plaintiff has presented no credible reason why this Court should not reconsider its

decision to ignore the language of Virginia’s long-arm statute. The Plaintiff correctly lists “an

intervening change in the law” and “correction of a clear error of law” as two grounds justifying

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reconsideration,1 but incorrectly states that neither of those conditions have been met when, in fact,

both have been satisfied. The subsequent decision in Mercer v. MacKinnon, No. 180358 (Va. Feb.

21, 2019), shows that this Court committed clear error when it disregarded the specific

requirements of Virginia’s long-arm statute, justifying reconsideration.

A. This Court Clearly Erred by Ignoring the Language of Virginia’s Long-Arm Statute.

The Undersigned Defendants recognize that before this Court was alerted to the Virginia

Supreme Court’s decision in Mercer, the question of whether this Court could ignore the language

of VA CODE § 8.01-328.1 was more muddled than it is now. Mercer made clear like no decision

before it that § 8.01-328.1 could not be ignored. Under Mercer, the Plaintiff must show that the

specific requirements enumerated in the long-arm statute have been met and he has failed to do so.

In an attempt to dodge the devastating impact of the Mercer ruling, the Plaintiff claims in

his Opposition (at 8, n. 4.), that Mercer

is inapposite because, as that court explained, that decision focused exclusively on


the long-arm statute because that was the “only basis [for personal jurisdiction]
presented.” Mercer v. MacKinnon, No. 180358, Slip op. at 1 (Va. Feb. 21, 2019).

This argument misses the point. If this Court’s analysis was correct, the Virginia Supreme Court

would have focused on the meaning of Due Process instead. In its Opinion (Dkt. 123), this Court

held that Virginia’s long-arm statute was interpreted as having the same meaning as the limitations

on personal jurisdiction imposed by the Due Process Clause. Under that “single inquiry” approach,

whether one is looking at the long-arm statute, or the Due Process Clause, the analysis is the same.

As this Court said:

For a court to assert personal jurisdiction over a nonresident defendant, two


conditions must be satisfied: (1) the exercise of jurisdiction must be authorized

1
See Plaintiff’s Consolidated Opposition to Defendants’ Motions for Reconsideration or
Certification for Interlocutory Appeal of the Court’s March 29 Order and Opinion (Dkt. 145) (the
“Opposition”) at 1.
2

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under the state’s long-arm statute; and (2) the exercise of jurisdiction must comport
with the due process requirements of the Fourteenth Amendment. ... Because
Virginia’s long-arm statute extends personal jurisdiction to the outer bounds of due
process, the two-prong test collapses into a single inquiry when Virginia is the
forum state.

Id. at 15-16 (internal citations and quotation marks omitted). Under this approach, this Court

treated the language of § 8.01-328.1 as identical to the requirements of Due Process.

The Virginia Supreme Court plainly did not agree that § 8.01-328.1 should be interpreted

that way. If the Virginia Supreme Court agreed with that “single inquiry” analysis, then Mercer

would have said something to this effect: “Regardless of the specific language used, Virginia’s

long-arm statute is always to be automatically interpreted as reaching the outer limits of personal

jurisdiction permissible under the Due Process Clause, and, therefore, we will examine the

meaning of due process in the context of these facts.” If the Virginia Supreme Court had followed

the same “single inquiry” analysis as this Court, the Mercer court would have ignored the language

of the statute as this Court had and delved into the familiar principles governing specific and

general personal jurisdiction under the Due Process Clause.

However, that is not what the Mercer court did. The Virginia Supreme Court did not ignore

the specific language of VA CODE § 8.01-328.1(A)(4). Indeed, it delved deeply into one single

clause in the statute. It briefly examined the history of the statute, Mercer, Slip op. at 4, examined

what the plain language of the clause meant, id. at 4-5, examined how other courts interpreted the

same subsection, id. at 4-6, and even examined what courts said when interpreting similar

provisions of other states’ long-arm statutes, id. at 5-6.2 In other words, the Mercer court did all

2
Specifically, Mercer cited Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez, 305 F.3d
120 (2nd Cir. 2002) (interpreting New York’s long-arm statute) and Louis v. Flagship Airlines,
Inc., No. 98-1753, 1999 WL 525947 (1st Cir. Feb. 5, 1999) (unpublished; for table disposition, see
181 F.3d 79) (attached as Exhibit L) (interpreting Massachusetts’ long-arm statute). Neither state
interprets their respective long-arm statutes as being identical to the limits imposed by Due
3

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the things courts typically do when interpreting the language of a statute. Furthermore, the words

“Due Process” do not appear in that decision (separately or together), and the concept of Due

Process is not even alluded to. In every respect, Mercer treated VA CODE § 8.01-328.1(A)(4) as

having a meaning separate and independent from the Due Process Clause.

Furthermore, the cases the Virginia Supreme Court relied on in Mercer also interpreted the

long-arm statute independently from the Due Process Clause. For instance, Mercer relied heavily

on the analysis of § 8.01-328.1(A)(4) found in Willis v. Semmes, Bowen & Semmes, 441 F. Supp.

1235 (E.D. Va 1977). That analysis was expressly divorced from Due Process analysis:

In reaching the above conclusions, the Court feels it has not given too restrictive a
reading of Virginia’s long arm statute. The Virginia Supreme Court has stated the
purpose of the statute is “. . . to assert jurisdiction over nonresidents who engage in
some purposeful activity in this State to the extent permissible under the due
process clause.” Kolbe, Inc. v. Chromodern Chair Co., 211 Va. 736, 740 [...]
(1971); Carmichael v. Snyder, 209 Va. 451, 456 [...] (1968). However, this
depiction of the law’s purpose was derived directly from a statement of intent by
the state legislature, a legislature that particularized in the statute what it deemed
the permissible outer limits for the acquisition of personal jurisdiction consistent
with due process. Therefore, insistence that these particulars be satisfied even in
those situations where it could plausibly be argued that a lesser standard would
meet due process requirements is a course mandated by legislative judgment.

This was not an incidental bit of dicta; It was central to the Willis court’s reasoning, because Willis

interpreted the long-arm statute as having a meaning separate and independent of due process.

Every case cited by Mercer that specifically dealt with the interpretation of § 8.01-

328.1(A)(4) agreed with Willis on this point. For instance, Mercer (Slip op. at 4) cited two pages

from Blue Ridge Bank v. Veribanc, Inc., 755 F.2d 371, 373-74 (4th Cir. 1985) that quoted from and

endorsed the above-quoted statement from Willis that Virginia’s long-arm statute had to be

interpreted separately from the Due Process Clause. The other case Mercer cited that involved the

Process. See D & R Global Selections, S.L. v. Bodega Olegario Falcon Pineiro, 29 N.Y.3d 292,
299 (2017) and Cossart v. United Excel Corp., 804 F. 3d 13, 18 (1st Cir. 2015).
4

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interpretation of § 8.01-328.1(A)(4) was First American First [sic] v. National Ass’n of Bank

Women, 802 F.2d 1511 (4th Cir. 1986). Relying on Veribanc, First American also separated the

two issues, first determining that the requirements of § 8.01-328.1(A)(4) had been met, and then

deciding whether Due Process was satisfied. Id. at 1514-17.

In short, Mercer interpreted Virginia’s long-arm statute—indeed, one phrase in § 8.01-

328.1(A)(4)—as having a history and meaning separate from the Due Process Clause. To support

its reading, it cited three federal cases, Willis, Veribanc, and First American, which explicitly

treated the requirements of the Virginia’s long-arm statute as separate from the constitutional

limitations on jurisdiction. In fact, there is not a single case cited in Mercer that says that the

language of Virginia’s long-arm statute can be ignored. Mercer made it clear that a Virginia court

cannot find personal jurisdiction without meeting the requirements of the long-arm statute and that

a Virginia court cannot ignore the language of the statute while doing so.

Furthermore, to pretend that the actual language of § 8.01-328.1 can be ignored would

violate the Virginia Supreme Court’s presumption against surplusage. In Travelers Property Cas.

Co. v. Ely, 276 Va. 339, 666 S.E.2d 523, 527 (2008), the Virginia Supreme Court rejected a

proffered interpretation of a different statute because

Any contrary construction or application of Code § 65.2-804(B) would render the


phrase “nonrenewed by the insurer issuing such policy” mere surplusage, which is
contrary to the settled rule in this Commonwealth that every provision in or part of
a statute shall be given effect if possible.

Yet this Court’s ruling treated the entirety of § 8.01-328.1, every provision in it and every part of

it, as surplusage. This Court has treated § 8.01-328.1 as though the actual words in the statute did

not matter, and instead pretended that the law actually said “a court may exercise personal

jurisdiction over persons outside of this Commonwealth to the utmost allowed under the

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constitutions of the United States and Virginia.” As previously noted 3 by the Undersigned

Defendants: “There are over 600 words in V A CODE § 8.01-328.1, and yet, according to this

Court’s ruling, Virginia only needed twenty-five.”

This “single inquiry” approach is also inconsistent with how the Virginia legislature has

treated the statute. The language chosen by the Virginia General Assembly was not only carefully

chosen: It was fussed over. Section 8.01-328.1 was first passed in 1964, St. Clair v. Righter, 250

F. Supp. 148, 149(W.D. V.A. 1966), and the Assembly has tinkered with it continually ever since,

with the statute being amended fifteen times since then. Why tinker with the language in a statute

that the courts are supposed to ignore?

Indeed, a great deal of this tinkering has come after the Fourth Circuit declared that the

statute’s language could be ignored. It appears that the first time the Fourth Circuit declared that

the language of § 8.01-328.1 could be ignored in favor of pure Due Process analysis came in Young

v. New Haven Advocate, 315 F.3d 256, 261 (4th Cir. 2002). Since Young, the statute was amended

three times: In 2007, 2009 and 2017. Were these useless acts, like shuffling deck chairs on the

Titanic? Mercer has made it clear that the Assembly has not been wasting its time, and § 8.01-

328.1 is not surplusage.

Moreover, additional developments in the law have undermined Young’s conclusion that

the language of Virginia’s long-arm statute can be ignored. Young stated that

Because Virginia’s long-arm statute extends personal jurisdiction to the extent


permitted by the Due Process Clause, see English & Smith v. Metzger, 901 F.2d 36,
38 (4th Cir. 1990), “the statutory inquiry necessarily merges with the constitutional
inquiry, and the two inquiries essentially become one.” Stover v. O’Connell
Assocs., Inc., 84 F.3d 132, 135-36 (4th Cir. 1996).

3
See the Brief in Support of the Joint Motion to Reconsider this Courts’ Finding of Personal
Jurisdiction or to Certify the Question for Interlocutory Appeal of Defendants Wilburn, Hickford,
Hoft, Creighton, and Words-N-Ideas, LLC at 11 (Dkt. 138).
6

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The first case cited in that passage, Metzger, does not support the proposition that the language of

§ 8.01-328.1 can be ignored. Metzger involved the interpretation of § 8.01-328.1(A)(1) and

specifically what the term “transacting business” meant in that subsection. Metzger did state that

“[i]n defining the term transacting business, we are mindful that the purpose of the Virginia long-

arm statute is to extend jurisdiction to the extent permissible under the Due Process Clause.”

However, this was not treated as an excuse to ignore the particular language of the statute. Rather,

it was used as a guiding principle as the court first independently determined whether the

requirements in § 8.01-328.1 (A)(1) had been met and then determined whether Due Process had

been satisfied. Thus, Metzger engaged in precisely the two-step analysis that Young eschewed.

That passage in Young also relied on Stover, but there are two problems in relying on Stover

today: 1) Stover did not concern Virginia law and 2) Stover has been overturned. Specifically,

Stover involved the interpretation of Maryland’s long-arm statute, 4 stating that

Because the limits of Maryland’s statutory authorization for the exercise of personal
jurisdiction are coterminous with the limits of the Due Process Clause, the statutory
inquiry necessarily merges with the constitutional inquiry, and the two inquiries
essentially become one.

This was a dubious interpretation at the time, and, it has subsequently been rebuked by the

Maryland Court of Appeals:

We stated recently in Beyond v. Realtime, 388 Md. 1, 15, 878 A.2d 567, 576 (2005)
that “[w]e have consistently held that the purview of the long arm statute is
coextensive with the limits of personal jurisdiction set by the Due Process Clause
of the Federal Constitution.” We did not, of course, mean by this that it is now
permissible to simply dispense with analysis under the long-arm statute. See id. at
14, 878 A.2d at 575 (noting that personal jurisdiction analysis entails “dual
considerations,” the first of which is analysis under the long-arm statute). Rather,
we meant no more than what we said in Geelhoed, viz., that we interpret the long-
arm statute to the limits permitted by the Due Process Clause when we can do so
consistently with the canons of statutory construction.

4
MD CODE CTS. & JUD. PROC. § 6-103(b).
7

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Mackey v. Compass, 391 Md. 117, 892 A.2d 479, 493 n.6 (2006). This overrules Stover because

the final authority on the meaning of a state’s law is that state’s highest court:

In accord with Erie R.R. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188
(1938), a federal court exercising diversity jurisdiction must apply the law of the
highest court of the state in which it sits. Wells v. Liddy, 186 F.3d 505, 527-28 (4th
Cir. 1999). Where state law is unclear, the court must predict how the highest court
of that state would rule if presented with the issue. Id.

Legard v. EQT Production Co., 771 F. Supp. 2d 607, 609 (W.D. Va. 2011). In Maryland, their

highest court, the Court of Appeals, has not overturned Mackey, and thus, that court has made it

abundantly clear that Maryland’s long-arm statute cannot be ignored, 5 just as the Virginia Supreme

Court has in Mercer.6 This fatally undermines Young’s single-inquiry approach.

Indeed, all the Undersigned Defendants are asking this Court to do is what the Mercer court

did. Just like the Mercer court, this Court should ask if the Plaintiff has met the requirements of

either § 8.01-328.1(A)(1) or (4), the subsections cited as supporting jurisdiction in the Amended

Complaint ¶ 4 (Dkt. 29). The Plaintiff does not dispute that they have failed to meet the

requirements of either subsection. Instead, they have put all of their “chips” on their hope that this

Court will continue to ignore the statutory language of § 8.01-328.1. The Plaintiff does not dispute

that the language of § 8.01-328.1(A)(1) has not been met because there is no allegation that the

alleged defamation arises from the Undersigned Defendants “[t]ransacting any business in this

Commonwealth” as required by the statute. Further, the Plaintiff does not dispute that the language

5
The Plaintiff claims that Stover is controlling law, apparently unaware of Mackey’s rebuke.
6
The Undersigned Defendants continue to ask this Court to interpret Virginia’s long-arm statute
in line with Maryland’s and Washington, D.C.’s long-arm statutes. Maryland’s long-arm statute
has been shown to be interpreted separately from Due Process. Likewise, D.C.’s long-arm statute,
D.C. CODE § 13–423, has also been interpreted as having a separate and independent meaning
from the Due Process Clause. Kopff v. Battaglia, 425 F. Supp. 2d 76, 81 (D.D.C. 2006) (“the
District government has made a deliberate decision not to allow access to D.C. courts to every
person who is injured here and otherwise could bring a claim for civil redress”).
8

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of subsection (A)(4) has not been met because the Undersigned Defendants have mounted an

evidence-based challenge to the application of this provision, and the undisputed evidence before

this Court shows that none of the Undersigned Defendants regularly do or solicit business, or

engage in any other persistent course of conduct, or derive substantial revenue from goods used or

consumed or services rendered, in this Commonwealth 7 as is required by this subsection. Simply

put, the Plaintiff left it so that if this Court decides it cannot ignore the long-arm statute, he loses.

Finally, like the Court in Mercer, this Court can stop right there. If there is no jurisdiction under

the long-arm statute, then it does not matter what the Due Process Clause says.

Therefore, respectfully, this Court’s decision holding that it had personal jurisdiction over

the Undersigned Defendants was mistaken. This was made clear by the Virginia Supreme Court’s

decision in Mercer which was decided after all briefing and hearings on the subject had concluded.

Because this represents an intervening change in the law, and because this Court’s decision was in

clear error, this Court should reconsider its ruling and dismiss the Undersigned Defendants for

lack of personal jurisdiction.

B. This Court Can Reconsider Its Decision in Light of Mercer v. MacKinnon.

The Plaintiff has also argued that even if this Court was wrong, it cannot reconsider its

decision granting personal jurisdiction over the Undersigned Defendants. This is incorrect. The

Plaintiff concedes that this Court can reconsider its ruling if there is an “an intervening change in

the law” or in order to “correct[] ... a clear error of law.” While only one of those two grounds are

needed for reconsideration, both are present in the instant case.

First, there has been a “significant change in the law … since the submission of the issue

7
See Declaration of R. Scott Creighton, Dkt. 47-2, ¶ 3; Declaration of James Hoft, Dkt. 47-3, ¶ 3;
Declaration of Michele Hickford, Dkt. 47-4, ¶ 4 (attesting to her and Words-N-Ideas, LLC’s lack
of contact with Virginia); and Declaration of Derrick Wilburn, Dkt. 47-5, ¶ 3.
9

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to the Court [has occurred].” Felts v. Volvo Grp. N. Am., LLC, No. 7:17-cv-00297 at *3 (W.D. Va.

Aug. 17, 2018) (brackets in original) (Exhibit A). Mercer was decided in February of this year,

after briefing had ended, and after the November, 2018, hearing on the motions to dismiss. Thus,

as required by Felts, this change in law came after submission of the issue to this Court.

Further, it was a significant change if only because it provided a clearer precedent than any

previous case. Before Mercer, each precedent cited by the Undersigned Defendants had persuasive

power, but each could be discounted for various reasons. For instance, the Undersigned Defendants

previously cited a number of Virginia circuit court decisions in support, but as circuit court

precedents, they might not have been seen as persuasive to this Court. Similarly, the Undersigned

Defendants cited Krantz v. Air Line Pilots Ass’n, Intern., 245 Va. 202 (1993) as an instance where

the Virginia Supreme Court said that the long-arm statute was intended to reach to the outer limits

of Due Process but still interpreted the long-arm statute separately from the Due Process Clause.

This Court could have reasonably discounted that analysis because the interpretation of the long-

arm statute did not impose a clear limitation in that case when jurisdiction was found to lie after

that analysis. Alternatively, this Court could have discounted that case because it was over twenty

years old, and it was decided before Young.

Likewise, the Undersigned Defendants had previously cited Bergaust v. Flaherty, 57 Va.

App. 423 (2011). Like in Mercer, the Flaherty court first focused on whether the terms of § 8.01–

328.1 had been satisfied, and, also like in Mercer, the Flaherty court found that the lower court

correctly dismissed the case based solely on the long-arm statute. However, this Court might have

discounted that persuasive authority because it was only issued by Virginia’s mid-level appellate

court and Legard held that this Court was only bound to obey the highest court of a relevant state

on matters of state law, supra 8.

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Thus, what makes Mercer so strong as a precedent can be boiled down to four factors that

had not coincided in any prior case. First, it comes from the Virginia Supreme Court, which this

Court is bound to follow (unlike lower Virginia courts). Second, its analysis of the long-arm statute

was determinative: The failure in Mercer to satisfy the strictures of § 8.01–328.1 was fatal, without

any consideration of Due Process. Third, it was clear that Mercer had treated § 8.01–328.1 as

having statutory requirements that were different than those seen in Due Process analysis. Fourth,

Mercer was recent—about as recent as one can ask for. While previous cases had some of these

factors, none of them had all four at once, making Mercer a very clear and controlling holding that

the long-arm statute’s specific language is not to be ignored. That is what Mercer changed.

By the above analysis, Mercer demonstrates that this Court had made a clear error of law,

and it is manifest injustice to try the Undersigned Defendants far from their homes, their jobs and

their families when this Court does not have personal jurisdiction over them. This is said with

respect, and with the recognition that Mercer had not been brought to this Court’s attention prior

to its ruling.8 However, with the benefit of Mercer, this Court has hard proof that it cannot ignore

the specific language of Virginia’s long-arm statute.

As this Court noted in Strebe v. Kanode, No. 7:17cv00321, at *1 (W.D. Va. Nov. 21, 2018)

(Exhibit B), when determining whether to grant a motion to reconsider “the goal is to reach the

correct judgment under law.” The emergence of Mercer has made it plain that this Court’s holding

that it had personal jurisdiction over the Undersigned Defendants was incorrect. Thus, it provides

two justifications for reconsideration: 1) the law had changed since submission of the motions to

dismiss, and 2) this change meant that this Court had made a clear error. Under this new and clear

8
Undersigned counsel was not aware of this ruling until after this Court’s March 29 opinion
because Mercer was decided while he was recovering from open-heart surgery that had been
performed earlier this year.
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precedent, this Court can no longer assert personal jurisdiction over the Undersigned Defendants

and, therefore, this Court should reconsider its ruling and dismiss them from this case. 9

II.
THE PLAINTIFF HAS FAILED TO SHOW ANY REASON WHY THIS COURT
SHOULD NOT, IN THE ALTERNATIVE, CERTIFY THE ISSUE OF PERSONAL
JURISDICTION FOR INTERLOCUTORY APPEAL

An interlocutory appeal is only available if this Court certifies that its ruling “involves a

controlling question of law as to which there is substantial ground for difference of opinion and

that an immediate appeal from the order may materially advance the ultimate termination of the

litigation,” 28 U.S.C. § 1292(b). Every single element required to make such a showing is present

with respect to the issue of personal jurisdiction.

A. A Favorable Decision in the Fourth Circuit Would Materially Advance the Ultimate
Termination of the Litigation for the Undersigned Defendants.

Taking these elements out of order, this Court should find that resolution of the question

“may materially advance the ultimate termination of the litigation.” The Plaintiff has argued, based

on a case from Pennsylvania, that a question would not materially advance termination of the

litigation unless it resolves all claims for all parties. Thus, the Plaintiff argues, because Mr.

Stranahan has not challenged personal jurisdiction, a favorable decision on personal jurisdiction

would not prevent this case from going forward for him. Furthermore, the Plaintiff has argued that

material advancement is frustrated because the Undersigned Defendants have not yet asked for a

stay in these proceedings. These arguments are unavailing for three reasons: First, the Plaintiff’s

proffered reading of the Material Advancement Clause is contrary to the plain language of

§ 1292(b) and binding precedent. Second, the Undersigned Defendants are only in the same case

9
Alternatively, this Court could certify the question of whether the language of the long-arm
statute can be ignored to the Virginia Supreme Court, as suggested previously without objection
from the Plaintiff.
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as Mr. Stranahan because the Plaintiff has inappropriately joined them. Finally, a stay might still

be granted and, even if it is not, the Fourth Circuit might rule in time to cut this case short. For all

of these reasons, it is plain that an appeal on the question of jurisdiction would materially advance

the ultimate termination of litigation.

1. Section 1292(b)’s Material Advancement Clause Does Not Require the Possibility
of Complete Termination of the Litigation.

The Material Advancement Clause of § 1292(b) amounts to an impact-on-litigation

requirement. The Plaintiff argues that the Material Advancement Clause imposes the most

stringent impact-on-litigation requirement possible, arguing that “resolution of the personal

jurisdiction question in Defendants’ favor will not materially advance termination of the litigation

because Stranahan would remain in this case.” Opposition at 16. In order to support that

interpretation of the Material Advancement Clause, the Plaintiff only cites Muller v. Temura

Shipping Co., 629 F. Supp. 1024, 1028 (E.D. Pa. 1986) a Pennsylvania case, which is only at best

persuasive authority. However, this interpretation of § 1292(b) is not persuasive, either as a matter

of plain language or in light of binding precedent.

First, it is a nonsensical interpretation of the plain language of the statute. Section 1292(b)

asks whether “an immediate appeal from the order may materially advance the ultimate

termination of the litigation.” If Congress intended to require that the appeal create the possibility

of ending the litigation for all parties, it could have instead asked whether “an immediate appeal

from the order may terminate the litigation.” The Plaintiff’s proffered interpretation of the Material

Advancement Clause would read the words “materially advance” out of the statute. Like the

Virginia Supreme Court, the United States Supreme Court has long cautioned that federal statutes

should be presumed to contain no surplusage. Ratzlaf v. United States, 510 U.S. 135, 140 (1994)

(disapproving of a lower court’s interpretation of a statute because it rendered some of its words

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“surplusage” and stating that “Judges should hesitate so to treat statutory terms”). Thus, under a

plain language interpretation—combined with the cannons of statutory construction—the Material

Advancement Clause does not require the possibility of complete termination of the suit.

This plain language reading of the statute is consistent with how the statute has been read

in this circuit. For instance, the Fourth Circuit has found that recusal was an appropriate issue for

interlocutory consideration under § 1292(b) because the original judge “has spent long months

mastering the factual background of this complicated lawsuit” and any new judge will have to

expend “time, expense and effort” catching up. In Re Virginia Elec. & Power Co., 539 F.2d 357,

364 (4th Cir. 1976). There was no suggestion that changing judges (or not) would immediately

terminate the litigation. Instead, the Fourth Circuit read the Material Advancement Clause as being

satisfied by a showing that less time, expense or effort might be expended by the Court depending

on the outcome of the appeal. Plainly that is equally true in the instant case, because if the

defendants seeking certification are successful in the Fourth Circuit on the issue of personal

jurisdiction, this Court would only have one defendant and one cause of action remaining.

Meanwhile, In re Microsoft Corp. Antitrust Litigation, 274 F. Supp.2d 741, 743 (D. Md.,

2003) held that certification was appropriate on an issue of collateral estoppel—the potential

preclusion of one factual question—because it would determine “the scope of evidence at the trial”

and the “scope of discovery.” This echoes the Fourth Circuit’s acceptance of an appeal under

§ 1292(b) related to a denial of discovery in N.C. Elec. Membership v. Carolina Power & Light,

666 F.2d 50 (4th Cir. 1981). Neither case involved a question with the potential to end the litigation

immediately—they only involved simplifying the trial or discovery. Both considerations are

equally present in the instant case: The scope of the trial and/or of discovery would be significantly

reduced if there was one defendant and one cause of action remaining.

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Certainly, the best way to materially advance the termination of litigation is to terminate it

completely. However, the plain language of the statute and the way it has been applied in this

circuit shows that reductions in time spent in court, expense and effort can also satisfy the Material

Advancement Clause. The Undersigned Defendants have made such a showing, and, therefore, the

Material Advancement requirement has been satisfied.

2. This Court Should Find That the Material Advancement Clause has been Satisfied
for the Undersigned Defendants Because They Have Been Misjoined.

The Undersigned Defendants have shown that complete termination of litigation is one

way, but not the only way, to satisfy the Material Advancement Clause. At first blush, it would

appear that this consideration is not present in relation to this motion for certification.

However, this suit has been misjoined, and it is only that misjoinder that makes it

impossible to end this entire suit on personal jurisdiction grounds alone. As this Court stated in

Headhunter, LLC v. Doe, No. 5:17-cv-00069 (W.D. Va. Sept. 21, 2018) (Exhibit C):

Federal Rule of Civil Procedure 20 permits a plaintiff to join parties in a single


action if (1) a right to relief is asserted against the defendants with respect to the
same transaction, occurrence, or series of transactions or occurrences; and (2) a
common question of law or fact will arise in the action. Fed. R. Civ. P. 20(a)(2).
Although the transaction or occurrence test of Rule 20 permits all “reasonably
related claims . . . to be tried in a single proceeding,” Saval v. BL Ltd., 710 F.2d
1027, 1031 (4th Cir. 1983) (quoting Moseley v. Gen. Motors Corp., 497 F.2d [1330],
1333 (8th Cir. 1974)), “[m]erely committing the same type of violation in the same
way does not link defendants together for purposes of joinder,” Raw Films, Ltd. v.
Does 1-32, No. 3:11-cv-532, 2011 WL 6182025, at *2 (E.D. Va. Oct. 5, 2011)
(quoting Laface Records, LLC v. Does 1-38, No. 5:07-cv-298, 2008 U.S. Dist.
LEXIS 14544, at *7 (E.D.N.C. Feb. 27, 2008)).

That last sentence, stating that “[m]erely committing the same type of violation in the same way”

is particularly salient in this case as the Plaintiff seems to have sued a random group of defendants

because they committed the same tort in a similar way. In Headhunter, nine Internet users had

allegedly used the same Internet service (BitTorrent) to illegally copy the movie A Family Man.

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However, this Court reasoned that the plaintiff had inappropriately joined those defendants:

this court concludes that plaintiff’s allegations do not support the joinder of nine
unknown and otherwise unrelated defendants. In so doing, the court rejects
plaintiff’s argument that defendants’ joining a common “swarm” to upload or
download A Family Man satisfies, in and of itself, “the same transaction,
occurrence, or series of transactions or occurrences” requirement under Rule
20(a)(2). That defendants uploaded and/or downloaded pieces of the same digital
copy of A Family Man does not necessarily give rise to the inference that their
actions are transactionally related.

Similarly, the Plaintiff has made no allegation that the Undersigned Defendants are related to Mr.

Stranahan. Instead, the Plaintiff seems to think that all he has to do is allege that each defendant

committed the same type of wrongful act. However, Headhunter expressly rejected the notion that

this was sufficient to meet the transaction or occurrence requirement of Rule 20(a)(2).

Therefore, Lee Stranahan does not belong in the same case as the Undersigned Defendants.

This Court can therefore sever the portion of the case involving Mr. Stranahan from the

Undersigned Defendants under Rule 21. Or, the simpler solution is to refuse to give the Plaintiff

the benefit of his misjoinder by ruling that because Mr. Stranahan’s case is improperly joined with

the Undersigned Defendants, that the Material Advancement Clause can be satisfied by showing

that a favorable decision would terminate the case for the Undersigned Defendants.

This is not the sole basis for finding that the Material Advancement requirement had been

met, but it would be a sufficient basis to support such a finding, supporting a certification allowing

for interlocutory appeal.

3. This Court Can Find that the Material Advancement Requirement is Satisfied With
or Without a Stay.

In a footnote, the Plaintiff notes that the Undersigned Defendants have not yet sought a

stay of proceedings in case this Court certifies an interlocutory appeal, and has claimed, citing an

inapplicable case, that discovery would necessarily continue even if such an appeal is granted. This

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entire inquiry is premature. The Undersigned Defendants will explore the issue of a stay when the

time is appropriate, but even if no stay was granted, the Fourth Circuit is likely to rule before trial

and perhaps even before this Court can rule on any motions for summary judgment the

Undersigned Defendants are likely to file. Thus, with or without a stay, the question would

materially advance the termination of litigation.

B. Personal Jurisdiction is a Controlling Question of Law.

As an initial matter, there is no doubt that the question of personal jurisdiction can be

controlling. For instance, Young was itself an interlocutory appeal, 315 F.3d at 261. However, the

Plaintiff argues that there is not a controlling question of law in this case based on two arguments:

First, the Plaintiff claims that the question of jurisdiction is a mixed question of fact and law and,

second, because a favorable decision would not end the case for all parties. Both arguments are

unavailing because there are no facts in dispute and because the Plaintiff’s interpretation of the

term “controlling” is erroneous. When applying the appropriate standard, it is plain that personal

jurisdiction is a controlling question of law within the meaning of § 1292(b).

1. There is No Factual Dispute, Therefore the Question of Personal Jurisdiction Is


Purely One of Law.

First, the Plaintiff argues that this motion does not involve a question of law because

determination of personal jurisdiction can involve disputes of fact. There is no question that an

appeal to the Fourth Circuit would be inappropriate to resolve a dispute of fact, but there is no such

dispute of fact in this case. The Undersigned Defendants presented an unrebutted factual challenge

to the Plaintiff’s assertion of jurisdiction. Having failed to present any evidence in his favor, the

Plaintiff cannot now pretend there is any dispute of fact. Therefore, what is left is a question of

how the law applies to these facts. That is a question of pure law.

Indeed, the unique question that the Undersigned Defendants have raised—whether this

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Court could appropriately ignore the specific language of Virginia’s long-arm statute—relies on

one single, undisputable fact: That this Court sits in Virginia. The rest of the issue is a

determination of how Virginia’s long-arm statute is to be interpreted—an issue of pure law if there

ever was one. For all of these reasons, both the interpretation of Virginia’s long-arm statute and

the question of personal jurisdiction generally are questions of law.

2. The Question of Jurisdiction is Controlling for These Undersigned Defendants.

Next, the Plaintiff claims that the question of personal jurisdiction cannot be controlling

because it will not dispose of the case for every defendant. The Plaintiff states that a “controlling

question of law … is a narrow question of pure law whose resolution will be completely dispositive

of the litigation, either as a legal or practical matter, whichever way it goes.” Opposition at 11

(internal quotation marks omitted). The Plaintiff then argues that because Lee Stranahan has not

challenged personal jurisdiction, the case will go on regardless. In short, the Plaintiff is arguing

that the term “controlling” in the phrase “controlling question of law” includes an impact-on-

litigation requirement that requires nothing less than the possibility completely terminating the

litigation. This represents both a misreading of § 1292(b) and the caselaw interpreting it.

The most obvious problem with reading this stringent impact-on-litigation requirement into

the word “controlling” is that § 1292(b) already has an impact-on-litigation requirement, stating

that certification is only appropriate if “an immediate appeal from the order may materially

advance the ultimate termination of the litigation.” As shown above, supra 12-15, the Material

Advancement Clause requires considerably less than a complete termination of all litigation for all

parties. In other words, the Plaintiff is trying to read the word “controlling” so that it would render

the entire phrase “may materially advance the ultimate termination of the litigation” surplusage.

As stated above, supra 13, federal statutes are presumed to contain no surplusage. Ratzlaf, 510

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U.S. at 140. Accordingly, this is not a persuasive interpretation of § 1292(b).

Furthermore, that reading is not supported by caselaw. The Plaintiff cites a number of cases

to support his reading of this subsection, but each district court decision the Plaintiff cites relies

on language found in Fannin v. CSX Transp., Inc., 873 F.2d 1438 (4th Cir. 1989) (unpublished)

(Exhibit D). However, none of those district court cases can be read as having such an extreme

interpretation of § 1292(b), because Fannin does not support that interpretation. All Fannin says

is “[c]ertainly the kind of question best adapted to discretionary interlocutory review is a narrow

question of pure law whose resolution will be completely dispositive of the litigation, either as a

legal or practical matter, whichever way it goes.” Id. at *5 (emphasis added). The Fannin court

was saying that this was an ideal circumstance under which to grant interlocutory review. It did

not say that it was the only situation that justified interlocutory review.

Likewise, that extreme interpretation of the word “controlling” cannot be squared with the

Fourth Circuit’s caselaw where interlocutory appeal was granted. As alluded to above, the Fourth

Circuit found that the recusal of a judge was correctly certified for interlocutory appeal, In Re

Virginia Elec. & Power Co., even though exchanging judges (or keeping the same judge) would

not have the effect of terminating the litigation. Similarly, in N.C. Elec. Membership, the Fourth

Circuit found that it could properly hear an interlocutory appeal regarding the scope of discovery,

even though the question was not determinative of the litigation for any party. Plainly, when

looking to the Fourth Circuit’s practice, a question does not have to be dispositive to any party, let

alone all parties, in order to be “controlling” within the meaning of § 1292(b).

Still, the Fourth Circuit has provided frustratingly little guidance on when a question is

controlling. However, if one looked outside this circuit, it would find that the most plausible

interpretation of the term “controlling,” is found in Katz v. Carte Blanche Corporation, 496 F.2d

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747 (3rd Cir. 1974) and its close examination of statutory history when interpreting § 1292(b):

A controlling question of law must encompass at the very least every order which,
if erroneous, would be reversible error on final appeal. If the statute were
interpreted to exclude any such order that interpretation would be inconsistent with
the clear intention of the sponsors to avoid a wasted trial. Nor need the order be
determinative of any plaintiff’s claim on the merits, since a dismissal for want of
jurisdiction is within § 1292(b). Zahn v. International Paper Co., supra; S. Rep.
No. 2434, 85th Cong., 2d Sess. 2 (1958) (reprinted in 3 U.S. Code Cong. & Admin.
News, p. 5256 (1958)). Nor need a reversal of the order terminate the litigation,
since with impleader and transfer of venue orders, two of the sponsors’ examples,
the lawsuit could continue regardless of the interlocutory determination although
an erroneous decision might cause a reversal on appeal from a final order. What
remains is the question whether in order for a question to be “controlling” must it
be one which if decided erroneously would lead to a reversal on appeal? Certainly
Judge Maris, testifying in favor of the bill on behalf of the Judicial Conference, did
not think so. His testimony suggests that “controlling” means serious to the conduct
of the litigation, either practically or legally. House Hearings at 21; see Note,
Discretionary Appeals of District Court Interlocutory Orders: A Guided Tour
through Section 1292(b) of the Judicial Code, 69 Yale L. J. 333, 343 (1959). And
on the practical level, saving of time of the district court and of expense to the
litigants was deemed by the sponsors to be a highly relevant factor. See S. Rep. No.
2434, 85th Cong., 2d Sess. 2 (1958) (reprinted in 3 U.S. Code Cong. & Admin.
News, p. 5256 (1958)).

Id. at 755 (footnotes omitted and emphasis added). This “serious to the conduct of the litigation”

approach has been adopted in many circuit and district courts across this country. 10

The question posed by the Undersigned Defendants—either about jurisdiction generally or

specifically under the long-arm statute—meets the standards for when a question is controlling

10
See, Virginia ex rel. Integra REC LLC v. Countrywide Sec. Corp., No. 3:14cv706 at *4 (E.D.
Va. June 3, 2015) (Exhibit H); Johnson v. Burken, 930 F.2d 1202, 1206 (7th Cir. 1991); Atrion
Networking Corp. v. Marble Play, LLC, 31 F. Supp.3d 357, 359 (D. R.I. 2014); In re Lupron
Marketing and Sales Practices Lit., 313 F. Supp.2d 8, 9 (D. Mass. 2004); Government of Virgin
Islands v. Blake, 944 F. Supp. 434, 437 (D. V.I. 1996); Bussing v. Cor Clearing, LLC, No. 8:12-
CV-238, at *1 (D. Neb. July 17, 2014) (Exhibit I); Kell v. Crowther, No. 2:07-CV-00359-CW, at
*2 (D. Utah Feb. 8, 2018) (Exhibit J); Navajo Nation, Corp. v. Urban Outfitters, Inc., No. 12-195
LH/LAM, at *5 (D. N.M. Feb. 12, 2015) (Exhibit K); U.S. v. Ups Customhouse Brokerage, Inc.,
464 F. Supp.2d 1364, 1372 (Ct. Int’l Trade 2006); and New York Football Giants, Inc. v.
Commissioner, 85 T.C.M. 810, 811 (T.C. 2003).
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under Katz. If the Undersigned Defendants are successful on appeal, this Court will be left with

one defendant and one cause of action. That is plainly serious to the conduct of the litigation,

satisfying Katz. Further, it involves an “order which, if erroneous, would be reversible error on

final appeal,” satisfying a different formulation in Katz. Id.11

Likewise, sister courts in this circuit have examined other criteria that are present in the

instant case. For instance, Gaston v. LexisNexis Risk Sols., No. 5:16-cv-9, at *1 (W.D. N.C. Nov.

13, 2017) (Exhibit E) held that “a question of law may be controlling ... if interlocutory reversal

might save time for the district court and time and expense for the litigants” (internal quotation

marks and citations omitted), another consideration that obviously applies when all but one party

and one claim is dismissed. Meanwhile LaFleur v. Dollar Tree Stores, Inc., No. 2:12-CV-00363,

2014 WL 2121721, at *2 (E.D. Va. May 20, 2014) (Exhibit F) held that a question can be

controlling if “the resolution of its questions on appeal would materially affect the outcome of

litigation”—another standard satisfied by the prospect of dismissing all but one defendant and

cause of action. Finally, Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ.

Comm’n, No. CCB-06-2773, at *4 (D. Md. June 29, 2015) (Exhibit G) held that “the application

of a legal standard is a controlling question of law within the meaning of section 1292(b),” a

consideration uniquely applicable to the Undersigned Defendants desire to revisit the question of

how Virginia’s long-arm statute should be interpreted.

Finally, while the Undersigned Defendants are not required to show that the question would

dispose of all issues for all defendants in order to render the question controlling, it is certainly

one way to show it is controlling. Here, again, the Plaintiff is attempting to benefit from his

11
See also Lynn v. Monarch Recovery Mgmt., Inc., 953 F. Supp. 2d 612, 623 (D. Md. 2013);
Cement Antitrust Litigation (MDL No. 296), In re, 673 F.2d 1020, 1026 (9th Cir. 1981); and Dorato
v. Smith, 163 F. Supp.3d 837 (D. N.M. 2015).
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misjoinder of the Undersigned Defendants to Mr. Stranahan, when there is no proper relationship

alleged between them. Under those circumstances, it should be sufficient to show that the question

might end the entirety of this case for the Undersigned Defendants depending on how it was

resolved, because they are not properly joined with Mr. Stranahan.

In short, the caselaw makes it clear that there are a number of ways to determine that the

question presented by the Undersigned Defendants is controlling, and the Undersigned Defendants

have met five of them. Accordingly, this case involves a controlling question of law.

C. There is Substantial Ground for Difference of Opinion.

Both sides essentially agree that one way to show that there are substantial grounds for a

difference of opinion is to show a split among courts on the question; they merely disagree about

whether the caselaw shows such a split. With respect to the interpretation of Virginia’s long-arm

statute, there can no longer be any doubt that Virginia courts do not read the statute as simply a

mirror of the limitations imposed by the Due Process Clause and the discussion of the issue, supra

2-9, makes that clear.

With respect to the question of whether the proposed assertion of personal jurisdiction will

offend Due Process, the Undersigned Defendants will let the Free Speech Defendants defend their

own arguments and will focus only on the caselaw that the Undersigned Defendants mentioned in

their brief. In instance after instance, the Undersigned Defendants have shown that the logic

applied by other courts would have resulted in dismissal for lack of personal jurisdiction in this

case, and the Plaintiff has failed to rebut those arguments.

The clearest example of those failures involves the Schmalfeldt cases.12 In those cases, the

12
Schmalfeldt v. Johnson, et. al., No. 15-CV-1516 (E.D. Wis. July 1, 2016) (Schmalfeldt I) and
Schmalfeldt v. Grady, et. al., No. 4:17-cv-01310-RBH-KDW (D. S.C. Dec. 7, 2017) (Schmalfeldt
II).
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behavior of the defendants ranged from writing about events in the forum state to the Internet at

large from outside the forum state—just as the Undersigned Defendants did—to a defendant

allegedly making phone calls and sending emails into the forum state from outside of the state.

However, those courts found that Due Process would not allow for the assertion of jurisdiction

over those defendants. The Plaintiff’s response misstated the facts of those cases, stating that “the

allegedly defamatory statements principally reflected the parties’ animus toward one another, and

they did not in any respect target the forum states.” The actual facts, which included alleged emails

and calls directed into the forum states and discussions of events taking place in those states, show

that those decisions are incompatible with this Court’s March 29 opinion.

Meanwhile, the Plaintiff tries to distinguish Edwards v. Schwartz, No. 7:18-cv-378 (W.D.

Va. March 20, 2019), which was handed down by this Court’s Roanoke division nine days before

the ruling in this case, by saying the following in a parenthetical:

none of the communications “targeted a particular forum, let alone Virginia,” that
they “were [not] of special interest to Virginia readers,” and that there were no
“facts indicating” that anyone in Virginia “was even aware of the communications
in question”

Opposition at 14 (citation omitted). However, every part of that argument applies to the instant

case. The Undersigned Defendants targeted the world at large and were only found to target

Virginia because the events they were discussing took place here. Because the events in

Charlottesville were a national story, it was not of interest to Virginians only, and there was no

evidence that anyone in Virginia were aware of the communications in question. Rather than

distinguishing the cases, the Plaintiff has shown just how similar they are.

Meanwhile, with respect to Planet Aid, Inc. v. Reveal, No. GLR-16-2974 (D. Md. June 26,

2017), the Plaintiff simply ignored the fact that Planet Aid held that the defendants could not be

subject to personal jurisdiction in Maryland, even though defendants in that case sent radio

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programs to be broadcast on Maryland public radio stations and appeared on a television broadcast

that transmitted from Washington, D.C., into Maryland, the Plaintiff focusing on factors that the

court did not consider controlling.

The purpose of the “substantial disagreement” inquiry is not to decide which side of the

debate among the courts is right, but to show that there is actual or potential debate. The cases

above, as well as the cases cited by the Free Speech Defendants, demonstrate beyond any

reasonable doubt that those courts, on the same facts, would have reached a different outcome,

satisfying the Substantial Disagreement Clause. With all three requirements of § 1292(b)’s test for

certifiability being met, this Court should certify the question of personal jurisdiction for

interlocutory appeal.

CONCLUSION

Mercer changed the law. This decision, handed down after the Undersigned Defendants’

motion to dismiss was submitted to this Court, made it clear that a plaintiff ignores the specific

requirements of Virginia’s long-arm statute at the peril of seeing his or her case dismissed. This

Court should find that the emergence of Mercer has demonstrated that it made a clear error that

must be rectified by reconsidering this Court’s March 29 decision, and dismissing the Undersigned

Defendants. Alternatively, this Court should grant the Undersigned Defendants the opportunity to

show the Fourth Circuit that Virginia’s courts have no rightful jurisdiction over them by certifying

the question of personal jurisdiction for interlocutory appeal.

24

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Thursday, June 6, 2019 Respectfully submitted,

s/ Aaron J. Walker
Aaron J. Walker, Esq.
Attorney for Defendants Wilburn, Hickford, Hoft,
Creighton and Words-N-Ideas, LLC
Va. Bar# 48882
7537 Remington Road
Manassas, Virginia 20109
(703) 216-0455
AaronJW72@gmail.com

CERTIFICATE OF SERVICE

I hereby certify that I electronically filed the foregoing with the Clerk of the Court for the
United States District Court for the Western District of Virginia on Thursday, June 6, 2019. All
participants in the case except Mr. Stranahan will be served automatically. Mr. Stranahan has been
served by email, with his consent.

s/ Aaron J. Walker

25

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List of Exhibits:
Exhibit A: Felts v. Volvo Grp. N. Am., LLC, No. 7:17-cv-00297 (W.D. Va. Aug. 17, 2018)

Exhibit B: Strebe v. Kanode, No. 7:17cv00321 (W.D. Va. Nov. 21, 2018)

Exhibit C: Headhunter, LLC v. Doe, No. 5:17-cv-00069 (W.D. Va. Sept. 21, 2018)

Exhibit D: Fannin v. CSX Transp., Inc., 873 F.2d 1438 (4th Cir. 1989)

Exhibit E: Gaston v. LexisNexis Risk Sols., NO. 5:16-cv-9 (W.D. N.C. Nov. 13, 2017)

Exhibit F: LaFleur v. Dollar Tree Stores, Inc., No. 2:12-CV-00363, 2014 WL 2121721 (E.D. Va.
May 20, 2014)

Exhibit G: Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm’n, No.
CCB-06-2773 (D. Md. June 29, 2015)

Exhibit H: Virginia ex rel. Integra REC LLC v. Countrywide Sec. Corp., No. 3:14cv706 (E.D. Va.
June 3, 2015)

Exhibit I: Bussing v. Cor Clearing, LLC, No. 8:12-CV-238 (D. Neb. July 17, 2014)

Exhibit J: Kell v. Crowther, No. 2:07-CV-00359-CW (D. Utah Feb. 8, 2018)

Exhibit K: Navajo Nation, Corp. v. Urban Outfitters, Inc., No. 12-195 LH/LAM (D. N.M. Feb.
12, 2015)

Exhibit L: Louis v. Flagship Airlines, Inc., No. 98-1753, 1999 WL 525947 (1st Cir. Feb. 5, 1999)

26

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EXHIBIT A

Case 3:18-cv-00017-NKM-JCH Document 148-1 Filed 06/06/19 Page 1 of 5 Pageid#: 2296


Felts v. Volvo Grp. N. Am., LLC (W.D. Va., 2018)

CAMERON R. FELTS Plaintiff, (CAP). Count II of the complaint asserts that


v. Volvo
VOLVO GROUP NORTH AMERICA,
LLC, Defendant. Page 2

Civil Action No. 7:17-cv-00297 retaliated against Felts for exercising his
FMLA rights by intentionally miscounting and
UNITED STATES DISTRICT COURT mis-designating his FMLA-qualifying leave
FOR THE WESTERN DISTRICT OF hours as unapproved, which resulted in Felts
VIRGINIA ROANOKE DIVISION having to sign the CAP. Count III of the
complaint, which is at issue in Felts's motion
August 17, 2018 to reconsider, asserts:

By: Elizabeth K. Dillon United States District Volvo willfully and in bad faith
Judge violated the FMLA and
regulations promulgated by the
OPINION AND ORDER GRANTING IN Department of Labor pursuant
PART AND DENYING IN PART to the FMLA by retaliating
PLAINTIFF'S MOTION TO against Felts for exercising his
RECONSIDER AND DENYING rights under the FMLA and
DEFENDANT'S MOTION FOR terminating him pretextually for
JUDGMENT ON THE PLEADINGS appearing three minutes late
and subsequently refusing to pay
This matter is before the court on two him backpay and benefits when
motions: 1) plaintiff Cameron Felts's motion to it finally reinstated him about 14
reconsider the court's memorandum opinion months later.
and order granting summary judgment as to
Count III of plaintiff's complaint, and 2) Volvo pretextually terminated
defendant Volvo Group North America, LLC's Felts for his purported violation
motion for judgment on the pleadings. For the of the Chronic Attendance Policy
following reasons, the court will grant in part on a single occasion when he was
and deny in part plaintiff's motion to about three minutes late for
reconsider and deny as moot defendant's work. However, Felts should
motion for judgment on the pleadings. never have been held to the
Chronic Attendance Policy in the
I. INTRODUCTION1
first place. Volvo intentionally
violated the FMLA by
In this case, Felts alleges that Volvo
misdesignating and
interfered with his substantive rights under
mischaracterizing his approved,
the Family and Medical Leave Act (FMLA) and
FMLA qualified leave hours as
retaliated against him for exercising his FMLA
unapproved and unexcused
rights. Count I of the complaint asserts that
hours.
Volvo interfered with Felts's lawful exercise of
his FMLA rights by mis-designating his
In violation of Felts' right to
FMLA-qualifying leave hours as unapproved,
reinstatement when Volvo
by overstating the number of FMLA-qualifying
finally relented and returned
leave hours Felts actually took, and by forcing
him to the workplace in
Felts to sign the Chronic Attendance Program
November 2016, defendant
unlawfully refused to make him
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Felts v. Volvo Grp. N. Am., LLC (W.D. Va., 2018)

whole and continued to retaliate terminating him were pretextual. The court
against him for his lawful reasoned that "[n]othing in the record
exercise of his FMLA rights. suggests that those responsible for Felts's
Volvo's post-reinstatement termination knew—or had any reason to
retaliatory adverse employment know—that the number of unexcused absence
actions included, inter alia, the hours were inaccurate, if indeed they were."
company's (A) refusal to afford (Id. at 16.)
him backpay and back benefits
to cover the 14 month period Felts now moves the court to reconsider
between his unlawful discharge its ruling as to Count III of the complaint
and reinstatement; (B) under under Federal Rule of Civil Procedure
demotion of Felts to a lower rate 54(b). Although Felts submits a barrage of
of pay; and (C) placement of reasons, many irrelevant to the motion at
Felts on a period of probation. hand, the court will address only those
arguments relevant to and underlying its
(Compl. ¶¶ 34-36.) decision. For its part, Volvo moves for
judgment on the pleadings, arguing that, given
The parties submitted cross-motions for the court's ruling with respect to Count III,
summary judgment, which were fully briefed Felts cannot prove damages.
and argued before the court. On May 15, 2018,
the court issued its memorandum opinion and II. DISCUSSION
order. The court denied summary judgment as
to Count I because "[i]t is not this court's role A. Felts's Motion to Reconsider
to decide at summary judgment whether Lilly's
and Shiffner's later statements were adequate Under Federal Rule of Civil Procedure
to justify earlier alleged errors, or to weigh 54(b), "a district court retains the power to
hypothetical scenarios as to whether Felts reconsider and modify its interlocutory
would have been placed on CAP with only 42 judgments . . . at any time prior to final
or 44 hours of unexcused absences." (Mem. judgment when such is warranted." Am.
Op. 12, Dkt. No. 51.) Likewise, the court denied Canoe Ass'n v. Murphy Farms, Inc., 326 F.3d
summary judgment as to Count II because 505, 514-15 (4th Cir. 2003). The resolution of
"there is a genuine dispute a motion for reconsideration filed pursuant to
this rule is "committed to the discretion of the
Page 3 district court." Id. at 515. In light of such
discretion, "[m]otions for reconsideration of
of material fact as to whether approximately interlocutory orders are not subject to the
40 hours of Felts's absences were properly strict standards applicable to
coded as FMLA-protected or not" and, "to the
extent Volvo contends that its reason for Page 4
placing Felts on CAP was legitimate and
nondiscriminatory, its reason is only motions for reconsideration of a final
'legitimate' if a) those 40 hours that comprise judgment." Id. at 514. Nonetheless, courts
the difference between the estimates of 42 or often consider the same factors2 and generally
44 and 84 hours were not FMLA-protected, or do not grant such motions unless "the Court
b) 42 or 44 hours of unexcused absences would has patently misunderstood a party, or has
have sufficed to place him on CAP." (Id. at 13.) made a decision outside the adversarial issues
With respect to Count III, however, the court presented to the Court by the parties, or has
concluded that Felts could not prevail because made an error not of reasoning but of
he could not establish that Volvo's reasons for apprehension [or] a controlling or significant
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Felts v. Volvo Grp. N. Am., LLC (W.D. Va., 2018)

change in the law or facts since the submission Decl. ¶ 9, Dkt. No. 24-5) ("Labor Relations
of the issue to the Court [has occurred]." Manager Linda Zart and I made the decision to
McAfee v. Boczar, No. 3:11-cv-646, 2012 WL terminate Felts.") The parties' briefing and
2505263, at *2 (E.D.Va. June 28, 2012) arguments on the motion to reconsider have
(citation omitted). "Reconsideration is also brought to light the internal inconsistency in
appropriate when 'the prior decision was the court's reasoning—specifically, between its
clearly erroneous and would work manifest declining to wade into matters of witness
injustice.'" McCoy v. Robinson, No. 3:08-cv- credibility with regard to Shiffner and the
555, 2011 WL 5975277, at *9 (E.D. Va. Nov. 28, legitimacy of Felts's placement on the CAP on
2011) (quoting Am. Canoe Ass'n, 326 F.3d at one hand, and its concluding that no genuine
515). dispute of material fact exists as to the reason
for Felts's termination, purportedly for
At the periphery, Felts argues that the violating the CAP, on the other hand.
court mistakenly refers to one of Felts's shifts Furthermore, a question remains as to the
as "scheduled" rather than "voluntary," and identity of the individual or individuals who
that the opinion incorrectly states that Felts actually made the decision to place Felts on
signed a Last Chance Agreement on November CAP in the first place. (See CAP Ltr. 1, Dkt. No.
28, 2016. The Court agrees. It amends page six 24-3). Accordingly, the court concludes that it
of the opinion to replace "scheduled" with committed a clear error of law when it held
"voluntary," and it strikes from page seven of that no genuine dispute of material fact exists
the opinion that "Felts signed a Last Chance as to Volvo's reasons for terminating Felts. See
Agreement on November 28, 2016." (Dkt. No. Am. Canoe Ass'n, 326 F.3d at 515 ("The
51.) ultimate responsibility of the federal courts, at
all levels, is to reach the correct judgment
At the heart of the matter, the court is under law.") It will grant Felts's motion for
persuaded by Felts's argument that the court reconsideration as to the allegations regarding
erred in concluding that Felts had insufficient termination in Count III.
evidence for a jury to conclude that Volvo's
reasons for terminating him were pretextual. To the extent Felts requests the court to
This is true, both as to his prima facie case and reconsider additional matters not addressed in
with regard to overcoming Volvo's legitimate this order, his motion will be denied.3
non-discriminatory reason for not awarding
backpay. On this basis alone, the court will B. Volvo's Motion for Judgment on the
grant Felts's motion to reconsider summary Pleadings
judgment as to Count III. With respect to
Count I, the court reasoned that Shiffner's Volvo moves for judgment on the
explanation as to why his earlier statement pleadings on the basis that, given the court's
regarding Felts's absence hours was incorrect summary judgment ruling as to Count III,
"may be legitimate, but that is not for Felts cannot prove he suffered any damages
under Counts I and
Page 5
Page 6
this court to decide" because matters of
witness credibility are for the jury. (Mem. Op. II. Because the court is granting Felts's motion
11.) With respect to Count III, it is now clear to to reconsider with respect to his termination
the court that it was not just Zart who as alleged in Count III, Volvo's motion is now
ultimately decided to terminate Felts for moot.
violating the CAP. Rather, Shiffner was also
involved in making the decision. (See Shiffner III. CONCLUSION
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Felts v. Volvo Grp. N. Am., LLC (W.D. Va., 2018)

For the reasons stated above, the court element of his prima facie case: whether he has
GRANTS plaintiff's motion for a serious health condition. As the court has
reconsideration regarding only the already noted in its memorandum opinion,
termination claim in Count III. (Dkt. No. 62.) that Felts's anxiety qualifies as a serious
Page six of the court's memorandum opinion medical condition is undisputed for purposes
is AMENDED to replace "scheduled" with of the motion only. (Mem. Op. 3 n.1.) The
"voluntary," and the statement "Felts signed a court's conclusion as to this matter will not
Last Chance Agreement on November 28, change regardless of how many times Felts
2016" is STRICKEN from page seven of the makes the same request.
opinion. (Dkt. No. 51.) Furthermore, the court
now DENIES defendant's motion for summary --------
judgment as to the allegations regarding
termination in Count III. (Dkt. No. 23.)
Plaintiff's motion to reconsider, to the extent it
raises issues other than the termination claim
in Count III, is DENIED.

Defendant's motion for judgment on the


pleadings is DENIED AS MOOT.

The clerk is directed to provide a copy of


this order to all counsel of record.

Entered: August 17, 2018.

/s/
Elizabeth K. Dillon
United States District Judge

--------

Footnotes:

1.The court assumes the parties'


knowledge of the facts underlying this case.

2.Pursuant to the Rule 59(e) factors, a


motion to reconsider may be granted : "(1) to
accommodate an intervening change in
controlling law; (2) to account for new
evidence not [previously] available . . .; or (3)
to correct a clear error of law or prevent
manifest injustice." Pac. Ins. Co. v. Am. Nat'l
Fire Ins. Co., 148 F.3d 396, 403 (4th Cir.
1998).

3. The court acknowledges that, in addition

to asking the court to reconsider its ruling as


to Count III, Felts once again asks for the court
to grant summary judgment in his favor on an
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EXHIBIT B

Case 3:18-cv-00017-NKM-JCH Document 148-2 Filed 06/06/19 Page 1 of 6 Pageid#: 2301


Strebe v. Kanode (W.D. Va., 2018)

BRIAN DAVID STREBE, Plaintiff, Farm, Inc., 326 F.3d 505, 514-15 (4th Cir.
v. 2003)).
BARRY KANODE, et al., Defendants.
Page 2
Civil Action No. 7:17cv00321
Resolution of the motion is "committed to
UNITED STATES DISTRICT COURT the discretion of the district court," Am. Canoe
FOR THE WESTERN DISTRICT OF Ass'n, 326 F.3d at 515, and "the goal is to reach
VIRGINIA ROANOKE DIVISION the correct judgment under law." Netscape
Commc'n Corp. v. ValueClick, Inc., 704 F.
November 21, 2018 Supp. 2d 544, 547 (E.D. Va. 2010) (internal
citation omitted). The court may consider
OPINION & ORDER reasoning from Rules 59(e) and 60(b) in
deciding whether to grant relief under Rule
By: Norman K. Moon United States 54(b). See Fayettesville Investors v.
District Judge Commercial Builders, Inc., 936 F.2d 1462,
1470 (4th Cir. 1991); Lynn, 953 F. Supp. 2d at
On September 18, 2018, I denied Strebe's
619 n.22 (collecting cases applying the
motion for preliminary injunction and granted analyses of Rules 59(e) and 60(b) to Rule 54(b)
summary judgment for the defendants. Strebe
reconsiderations). Therefore, a court may
v. Kanode, No. 7:17cv00321, 2018 WL 4473117 consider such factors as "undue delay, bad
(W.D. Va. Sept. 18, 2018). Strebe, a Virginia
faith or dilatory motive on the part of the
inmate proceeding pro se filed two motions to
movant, repeated failure to cure deficiencies
alter, amend, or reconsider (Dkt. Nos. 33, 40)
by amendments previously allowed, undue
pursuant to Rule 59 and/or Rule 60 of the
prejudice to the opposing party by virtue of
Federal Rules of Civil Procedure. For the
allowance of the amendment, futility of the
reasons that follow, the motions are
amendment, etc." Foman v. Davis, 371 U.S.
DENIED.
178, 182 (1962).

I.
In Strebe's proposed amendment, he
sought to add two retaliation claims against
I will first assess the motion for
RNCC employees. In the proposed third claim,
reconsideration of the denial of Strebe's
he alleges Investigator Horton retaliated
motion to amend, Dkt. No. 33.
against Strebe for filing the present lawsuit by
threatening Strebe. In the proposed fourth
Motions for reconsideration of an
claim, Strebe argues that his due process rights
interlocutory order are governed by Federal
were violated when Chief of Housing and
Rule of Civil Procedure 54(b), under which
Programs A. Kilbourne, Assistant Warden P.
"any order . . . may be revised at any time
White, and Senior Counselor Walz fired Strebe
before the entry of a judgment adjudicating all
from his job as an inmate law library clerk
the claims and all the parties' rights and
without a hearing. The court denied the
liabilities." Fed. R. Civ. P. 54(b). "Thus, when
motions. In his motion for reconsideration,
warranted, a district court retains the power to
Strebe argues (1) the motion is timely because
reconsider and modify its interlocutory
he submitted the motion to amend
judgments at any time before the final
immediately following the actions of the
judgment." Lynn v. Monarch Recovery
proposed new defendants; and (2) the claims
Mgmt., Inc., 953 F. Supp. 2d 612, 618 (D. Md.
relate to the underlying lawsuit. Timeliness is
2013) (citing Am. Canoe Ass'n v. Murphy
immaterial because the proposed third claim is

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Strebe v. Kanode (W.D. Va., 2018)

unexhausted and the proposed fourth claim is is warranted when an institution's appeal
unrelated to the underlying lawsuit. process necessarily must continue after the
filing of the complaint." Germain v. Shearin,
As to the third claim, Strebe alleges 653 F. App'x 231, 234 (4th Cir. 2016) (citing
Investigator Horton retaliated in response to McKinney v. Carey, 311 F.3d 1198, 1199 (9th
Strebe's lawsuit against Warden Kanode and Cir. 2002) (noting the First, Second, Third,
Director Clarke. Specifically, Investigator Seventh, Eleventh, and D.C. Circuits follow
Horton told this rule)); see Freeman v. Francis, 196 F.3d
641, 645 (6th Cir. 1999) ("The plain language
Page 3 of the statute [§ 1997e(a)] makes exhaustion a
precondition to filing an action in
Strebe to drop his lawsuit against Warden
Kanode and Director Clarke. When Strebe Page 4
informed Investigator Horton that he would
not comply, Investigator Horton stated that he federal Court. . . . The prisoner, therefore, may
would make sure that Strebe would be: fired not exhaust administrative remedies during
from his job as a law library clerk, banned from the pendency of the federal suit."); see also
the law library, charged with a false infraction, Ross v. Blake, 578 U.S. ___, 136 S. Ct. 1850,
transferred to another institution, and housed 1859 (2016) ("When an administrative process
with an offender who would rape Strebe. is susceptible of multiple reasonable
Another investigator later approached Strebe, interpretations, Congress has determined that
reminded Strebe of Investigator Horton's the inmate should err on the side of
threats, and had Strebe write a statement exhaustion."). Here, Strebe fully admits that
admitting that Strebe had made false his claims are unexhausted and that he is
allegations against a staff member. On actively attempting to litigate this claim and
November 27, 2017, Strebe was suspended proceed through the grievance procedure
from his institutional employment due to an simultaneously. Am. Compl. 2, Dkt. No. 28-1;
"open investigation," but he was not charged Grievance Reports, Dkt. No. 28-3. Therefore,
with a disciplinary infraction. After Strebe the claim is premature under the PLRA and I
filed his first motion to amend, an outside will deny the motion to reconsider the motion
investigator arrived to speak with Strebe about to amend as to his proposed third claim.
his allegations, but, according to Strebe, the
investigator was only interested in the threat Furthermore, the proposed fourth claim is
of sexual assault. Strebe asserts that he heard unrelated to the underlying complaint and
Investigator Horton laughing through the wall ultimately futile because there is no
during the interview. The laughing upset constitutional due process protection for an
Strebe, so he ended the interview and returned institutional occupation. See Fed. R. Civ. P.
to his cell. 20(a)(2) (discussing permissive joinder of a
defendant). The Due Process Clause applies
Under the Prisoner Litigation Reform Act when government action deprives an
("PLRA"), a prisoner must fully exhaust individual of a legitimate liberty or property
available administrative remedies before interest. Bd. of Regents of State Colls. v. Roth,
bringing a § 1983 action. Porter v. Nussie, 534 408 U.S. 564, 569 (1972). The first step in
U.S. 516, 524 (2002). An inmate plaintiff is not analyzing a procedural due process claim is to
required to make an affirmative showing that identify whether the alleged conduct affects a
he has exhausted his claims pursuant to the protected interest. See Beverati v. Smith, 120
prison's grievance procedure. Jones v. Bock, F.3d 500, 502 (4th Cir. 1997). Here, "[t]he law
549 U.S. 199, 215 (2007). Nonetheless, is clear that [an inmate does] not enjoy a
"[e]xhaustion has not occurred and dismissal protected property or liberty interest in
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Strebe v. Kanode (W.D. Va., 2018)

retaining his prison job." Hinton v. Diggs, No. As to the preliminary injunction, Strebe
3:09cv469, 2011 WL 2964413, at *2 (E.D. Va. argued that the defendants denied him access
July 20, 2011); see also Bulger v. United States to the courts when they replaced computer
Bureau of Prisons, 65 F.3d 48, 49 (5th Cir. programs with programs that had lesser
1995) (holding that "prisoners have no functionality. I ruled directly on this matter in
constitutionally protected liberty or property the memorandum opinion and Strebe has not
interests per se in their prison job presented an intervening change in controlling
assignments"); Backus v. Ward, 151 F.3d law, new evidence, a clear error of law, or
1028, 1028 (4th Cir. 1998) (per curiam) manifest injustice. See Mem. Op. 15 n.4
(unpublished) (citing Bulger and asserting ("Strebe is not constitutionally entitled to any
same). Therefore, I will deny the motion to specific word processor, computer program, or
reconsider the motion to amend as to his typing apparatus."). Therefore, I will deny the
proposed fourth claim as futile and unrelated motion for reconsideration as to the
to the underlying complaint. preliminary injunction.

Page 5 As for reconsideration of the dismissal of


his case, Strebe asserts the following:
II.
Page 6
Second, I will discuss the denial of the
motion for preliminary injunction and the (1) Under the second Turner
dismissal of Strebe's case. See Dkt. Nos. 33, 39, factor,1 I failed to address:
40. A court may amend or alter a judgment
under Rule 59(e) "(1) to accommodate an
intervening change in controlling law; (2) to a. the strain that
account for new evidence not available at trial; the revised policy
or (3) to correct a clear error of law or prevent places on Strebe's
manifest injustice." Hutchison v. Staton, 994 family;
F.2d 1076, 1081 (4th Cir. 1993). "Importantly,
however, a Rule 59(e) motion for b. that not all
reconsideration may not be used to 'reargue inmates possess a
the facts and law originally argued in the JPay device or are
parties' briefs.'" Projects Mgmt. Co. v. able to access
DynCorp Int'l, L.L.C., 17 F. Supp. 3d 539, 541 online services;
(E.D. Va. 2014) (quoting United States v.
Smithfield Foods, 969 F. Supp. 975, 977 (E.D. c. the quality of the
Va. 1997)). This standard is narrowly copied photos; and
construed, as a Rule 59(e) motion is "'an
extraordinary remedy which should be used d. the prison's
sparingly.'" Pac. Ins. Co. v. Am. Nat'l Fire Ins. destruction of
Co., 148 F.3d 396, 403 (4th Cir. 1993) (quoting returned
11 Wright et al., Federal Practice and prisoners' mail.
Procedure § 2810.1, at 124 (2d ed. 1995)); see
Durkin v. Taylor, 444 F. Supp. 879, 889 (E.D.
Va. 1977) ("Whatever may be the purpose of (2) Under the third Turner
Rule 59(e) it should not be supposed that it is factor, I failed to recognize that
intended to give an unhappy litigant one the new policies have not
additional chance to sway the judge."). reduced the flow of contraband
into the prison; and
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Strebe v. Kanode (W.D. Va., 2018)

appear to raise it. Although pro se litigants are


(3) I failed to address that the entitled to liberal construction of their claims,
prison was retaining and reading a court may not create facts and claims for
scanned copies of incoming mail them. He may raise such a claim in a new and
which chilled Strebe's family's separate filing.
freedom of expression for fear of
retaliation. In Error 2, Strebe asserts that I did not
address the prison policy's ultimate failure.
Strebe's motion mostly presents issues that the His argument is unconvincing. Strebe
court already ruled upon, either expressly or simultaneously argues that more contraband
by reasonable implication, when I dismissed is flowing into the prison than before while
his action. Furthermore, he fails to show an admitting that the correspondence policy
intervening change in controlling law, new "eliminates all avenues for smuggling drugs
evidence not available at trial, a clear error of into the system through the mail." Mot. for
law, or manifest injustice. Nevertheless, the Recons. 5, Dkt. No. 40. The prison's desired
court will briefly discuss his arguments. impact was to deter and lessen contraband
smuggling through the mails. Therefore, the
Errors 1(a), 1(c), and 3 are closely related third Turner factor still weighs in favor of the
and so I will address them together. In these defendants, because reversal of the policy
assignments of error, Strebe asserts that I would allow for a greater risk of the entry of
failed to fully address his arguments under the drugs. See Mem. Op. 12-13.
second factor in Turner, specifically the
significant negative impact of the policy on his III.
family. However, in the memorandum
opinion, I specifically discussed the Accordingly, the court DENIES the
alternatives available for Strebe and his motions for reconsideration, ECF Nos. 33, 40.
relatives. Although I sympathize that paying
extra and using particular methods The Clerk is directed to send a copy of this
order to the parties.
Page 7
ENTER: This 21st day of November, 2018.
of correspondence may place some strain on
both Strebe and his family, prisoners are not /s/_________
entitled to unlimited access to the mails and I NORMAN K. MOON
previously ruled on the constitutionality of the SENIOR UNITED STATES DISTRICT
policy at issue in the memorandum opinion. JUDGE
See Mem. Op. 11-14; Oliver v. Powell, 250 F.
Supp. 2d 593, 607-08 (E.D. Va. 2002) --------
(quoting Turner, 482 U.S. at 92) ("[I]f
Footnotes:
prisoners were permitted to have unfettered
access to their general correspondence, it 1. Turner v. Safley, established the four-
would 'threaten the core functions of prison pronged test that applies to regulations
administration, maintaining safety and censoring incoming mail. 482 U.S. 78 (1987)
internal security.'"). (establishing test and specifically rejecting
strict scrutiny standard); see Montcalm Publ'g
As to Error 1(b), Strebe has a JPay Corp. v. Beck, 80 F.3d 105, 108 (4th Cir. 1996).
device—his argument that other prisoners may Under Turner, courts must consider: (1)
not have them is unavailing. For Error 1(d), I whether there is a "valid, rational connection"
did not address the claim because he did not between the prison regulation or action and
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Strebe v. Kanode (W.D. Va., 2018)

the interest asserted by the government, or


whether this interest is "so remote as to render
the policy arbitrary or irrational"; (2) whether
"alternative means of exercising the right . . .
remain open to prison inmates"; (3) what
impact the desired accommodation would
have on security staff, inmates, and the
allocation of prison resources; and (4) whether
there exist any "obvious, easy alternatives" to
the challenged regulation or action. Lovelace
v. Lee, 472 F.3d 174, 200 (4th Cir. 2006)
(quoting Turner, 482 U.S. at 89-92).

--------

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EXHIBIT D

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EXHIBIT C

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Headhunter, LLC v. Doe (W.D. Va., 2018)

HEADHUNTER, LLC, Plaintiff, is styled as a motion to quash, which is more


v. appropriately construed (because of its
DOES 1-9, Defendants. content and liberal construction of pro se
pleadings), and which the court will construe,
Civil Action No. 5:17-cv-00069 as a motion to sever. (Dkt. No. 15.) This motion
purports to be filed by a different John Doe
UNITED STATES DISTRICT COURT defendant, but he did not file anything
FOR THE WESTERN DISTRICT OF identifying himself to the court, and he failed
VIRGINIA HARRISONBURG DIVISION to sign the motion. The third motion is a
redacted "Motion to Sever and Dismiss with
September 21, 2018 Prejudice, Motion to Dismiss" (hereinafter
motion to sever and dismiss) filed by the Filing
By: Elizabeth K. Dillon United States District
Defendant. (Dkt. No. 25).
Judge
For the following reasons, the court will
MEMORANDUM OPINION
allow the Filing Defendant to file his motions
anonymously. The court will construe the
I. BACKGROUND
motion to sever and dismiss (Dkt. No. 25) as a
motion to sever, and it will grant the motion to
Plaintiff Headhunter, LLC filed this action
sever in part. Accordingly, plaintiff's claim
for copyright infringement against nine "John
against John Doe 1 will be severed from the
Doe" defendants (the Doe defendants).
claims against Doe defendants 2-9, and the
Plaintiff owns the copyright to a movie titled A
claims against Doe defendants 2-9 will be
Family Man. The Doe defendants are alleged
dismissed without prejudice. The court
to have downloaded and distributed A Family
understands that the Filing Defendant is not
Man illegally, using BitTorrent, a peer-to-peer
John Doe 1, so he would not remain in the case
file-sharing internet protocol. The Doe
after the claims against Doe defendants 2-9 are
defendants are identified in the complaint only
severed. The unsigned, motion to quash (Dkt.
by internet protocol (IP) addresses, through
No. 15), filed by the unknown John Doe
which the copyrighted work was allegedly
defendant, will be struck pursuant to Rule 11.
downloaded. Each IP address is assigned to a
Because of the ruling as to the motion to sever
customer on a specific date by an Internet
and dismiss (Dkt. No. 25), the court will deny
Service Provider (ISP). No defendant has been
as moot the first motion to quash. (Dkt. No.
served yet, but the court allowed discovery to
11). Although the court is not granting any
enable Headhunter to issue a third party
motion to quash, because the court is severing
subpoena1 in an attempt to identify the Doe
the claims of the Doe defendants, the court will
defendants.
quash the current subpoena as to Doe
This matter is before the court on three defendants 2-9. Headhunters will be directed
motions. The first is a redacted motion to to notify the recipient of the third-party
quash subpoena filed by one of the John Doe subpoena of this ruling.
defendants, pro se, (Filing Defendant) who
II. DISCUSSION
identifies himself in an unredacted motion
filed with the court. (Dkt. Nos. 11 and 13.) The
A. The Filing Defendant May Proceed
second motion
Anonymously
Page 2
First, the court must determine whether
the Filing Defendant may proceed
anonymously in this case. While he did not file
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Headhunter, LLC v. Doe (W.D. Va., 2018)

a motion asking leave to file anonymously, the public is not denied its right to attend the
court will proceedings or inspect the" court's opinions
and orders on the underlying constitutional
Page 3 issue. Id. "[T]he only thing potentially being
shielded from the public is plaintiff's name and
construe his pleadings to make that request any court proceedings or
given that he filed unredacted and redacted
versions of his pleadings. Headhunter has not, Page 4
in its responses, objected to anonymity.
opinions that might be necessary to determine
"The ultimate test for deciding if a plaintiff standing." Id. (quoting Doe v. Barrow Co., 219
should proceed anonymously is whether [he] F.R.D. 189, 193 (N.D. Ga. 2003)). "Still, it is
'has a substantial privacy right which the exceptional case in which a court allows a
outweighs the customary and constitutionally- party to proceed anonymously." Id.
embedded presumption of openness in
judicial proceedings.'" Doe v. Pittsylvania Whether a plaintiff is allowed to proceed
Cty., Va., No. 4:11-cv-43, 2012 U.S. Dist. anonymously is a decision committed to the
LEXIS 13618, at *2-3 (W.D. Va. Feb. 3, 2012) sound discretion of the district court. Id. at *6.
(some internal quotation marks omitted) To guide this decision, the Fourth Circuit has
(quoting Doe v. Frank, 951 F.2d 320, 323 (11th provided the following five factors:
Cir. 1992)). This presumption of openness is
well grounded in our nation's laws. Id. at *3. [1] whether the justification
"Courts have long held that the First asserted by the requesting party
Amendment protections of freedom of speech is merely to avoid the annoyance
and press safeguard the public's right to attend and criticism that may attend
trials, which must be 'open to the public absent any litigation or is to preserve
an overriding and clearly articulated interest privacy in a matter of sensitive
to the contrary.'" Id. (quoting Doe 1 v. Merten, and highly personal nature; [2]
219 F.R.D. 387, 390-91 (E.D. Va. 2004)). In whether identification poses a
fact, "anonymity is not contemplated by the risk of retaliatory physical or
Federal Rules of Civil Procedure." Id. Quite the mental harm to the requesting
opposite: Rule 10(a) provides that "[t]he title party or even more critically, to
of the complaint must name all the parties." innocent non-parties; [3] the
Fed. R. Civ. P. 10(a) (emphasis added). The ages of the persons whose
purpose of this rule "is to 'apprise the parties privacy interests are sought to be
of their opponents and to protect the public's protected; [4] whether the action
legitimate interest in knowing all the facts and is against a governmental or
events surrounding court proceedings.'" private party; and relatedly [5]
Pittsylvania Cty., 2012 U.S. Dist. LEXIS the risk of unfairness to the
13618, at *3 (quoting Doe v. Hallock, 119 opposing party from allowing an
F.R.D. 640, 643 n.1 (S.D. Miss. 1987)). action against it to proceed
anonymously.
But the presumption of openness is not
absolute; anonymity may be appropriate in James v. Jacobson, 6 F.3d 233, 238 (4th Cir.
some cases. "The crucial interests served by 1993). Not all of these factors may be relevant
open judicial proceedings are not to a given case, and there may be others that
compromised by allowing a party to proceed are. Id. At bottom, then, the trial court must
anonymously." Id. at *4. If a plaintiff is granted "carefully review all the circumstances of [the]
leave to proceed under a pseudonym, "the case and then decide whether the customary
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Headhunter, LLC v. Doe (W.D. Va., 2018)

practice of disclosing the plaintiff's identity severing the case for improper joinder based
should yield to the plaintiff's privacy on disparate alleged acts.3 (Mot. to Quash;
concerns." Pittsylvania Cty., 2012 U.S. Dist. Dkt. No. 15). The court will grant the motion in
LEXIS 13618, at *7 (quoting Frank, 951 F.2d at part.
323).
1. Federal Rule of Civil Procedure
The court concludes that the factors 20(a)(2)
relevant to this case weigh in favor of
anonymity. Here, not all of the factors are Federal Rule of Civil Procedure 20
relevant. Given that the Filing Defendant has permits a plaintiff to join parties in a single
not been identified or served yet and that he action if (1) a right to relief is asserted against
challenges the efforts to identify him, he has the defendants with respect to the same
justification for his request and is not merely transaction, occurrence, or series of
avoiding annoyance. Moreover, and most transactions or occurrences; and (2) a
importantly, there is no risk of unfairness to common question of law or fact will arise in the
the opposing party because the opposing party action. Fed. R. Civ. P. 20(a)(2). Although the
was allowed to file the case against John Doe transaction or occurrence test of Rule 20
defendants and proceed with attempting to permits all "reasonably related claims . . . to be
identify those defendants. For these tried in a single proceeding," Saval v. BL Ltd.,
710 F.2d 1027, 1031 (4th Cir. 1983) (quoting
Page 5 Moseley v. Gen. Motors Corp., 497 F.2d

reasons, the court will permit the Filing Page 6


Defendant to proceed anonymously and will
deem his redacted pleadings to be 1300, 1333 (8th Cir. 1974)), "[m]erely
appropriately filed. committing the same type of violation in the
same way does not link defendants together
B. Motion to Sever and Dismiss with for purposes of joinder," Raw Films, Ltd. v.
Prejudice, Motion to Dismiss Does 1-32, No. 3:11-cv-532, 2011 WL 6182025,
at *2 (E.D. Va. Oct. 5, 2011) (quoting Laface
The court turns next to the Filing Records, LLC v. Does 1-38, No. 5:07-cv-298,
Defendant's second motion which is the 2008 U.S. Dist. LEXIS 14544, at *7 (E.D.N.C.
motion to sever and dismiss. (Dkt. No. 25.) In Feb. 27, 2008)). Rule 20 grants courts "wide
that motion, the Filing Defendant seeks discretion concerning the permissive joinder
dismissal of the case because of numerous of parties," and if joinder will result in
extensions of time to serve the defendants, prejudice, expense, or delay, the court has
asks that the court rule on the Filing discretion to deny joinder. Aleman v. Chugach
Defendant's initial motion to quash (Dkt. No. Support Servs., Inc., 485 F.3d 206, 218 n.5
11) and the other Doe defendant's motion to (4th Cir. 2007). If Rule 20's requirements are
sever (Dkt. No. 15), and asks that this judge not met, the court has the power under Rule 21
recuse herself from the case for a delay in to sua sponte sever the defendants deemed to
ruling on the motions.2 Because the Filing be improperly joined. See Cell Film Holdings,
Defendant seeks relief requested by the other LLC v. Does 1-12, No. 3:16-cv-749, 2016 WL
Doe defendant in the form of a motion to sever, 7494319, at *2 (E.D. Va. Dec. 30, 2016)
the court will liberally construe the Filing (finding joinder of Doe defendants in
Defendant's motion to incorporate by copyright action improper and sua sponte
reference the arguments set forth in the other severing and dismissing defendants).
Doe defendant's motion. Specifically, that
motion offers arguments in support of 2. The BitTorrent protocol
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Headhunter, LLC v. Doe (W.D. Va., 2018)

A brief description of how BitTorrent torrent file to ensure that the


functions is useful in order for the court to reconstituted file is error-free. A
properly address joinder in this case. The court user that has received all of the
in Malibu Media, LLC v. John Does, 878 F. pieces can also become a new
Supp. 2d 628, 631 (E.D. Va. 2012), described "seeder" using the reconstituted
the program aptly: file as a new "seed."

BitTorrent is a filesharing 3. Joinder of the nine Doe


protocol that distributes the defendants is improper.
work of downloading and
uploading files among several Plaintiff contends that joinder of the Doe
computers, thereby reducing the defendants is proper under Federal Rule of
workload on the source of a file Civil Procedure 20(a)(2) because defendants'
and enabling faster, more acts of infringement were part of the same
efficient sharing of large files. To series of transactions involving A Family Man.
use the protocol, a user installs a Specifically, plaintiff alleges that the Doe
BitTorrent client on his or her defendants participated in the same "swarm,"
computer. A user wishing to or group of BitTorrent users that downloaded
share a file uses the client to and uploaded the same file during a given
create a torrent descriptor file period, here three weeks, in order to receive
for the target file. The client and transmit a digital copy of A Family Man
breaks the target file into pieces, associated with a specific hash value. (See
each of which is assigned [an] Opp'n 13, Dkt. No. 18.)
alphanumeric identifier unique
to the target file, known as a Joining multiple Doe participants in a
"hash." The original file is known BitTorrent swarm into a single action is
as a "seed," and the user sharing commonly referred to as "swarm joinder." See
it is known as a "seeder." I.T. Prods., LLC v. Does 1-12, No. DKC 16-
3999, 2017 WL 167840, at *1 (D. Md. Jan. 17,
Other BitTorrent users then can 2017). Courts across the country have split as
begin downloading pieces of the to whether swarm joinder is permissible. Cell
target file. As each user Film Holdings LLC v. Galang, 2:16-cv-2142,
downloads a piece, his 2017 WL 5895132, at *3 (D. Nev. Nov. 29,
BitTorrent client immediately 2017) (collecting cases). The only circuit court
makes that piece available to to have addressed the issue, the D.C. Circuit,
other users. Thus, it is not has held that swarm joinder is impermissible
necessary for a user to download under Rule 20(a)(2). See AF Holdings, LLC v.
a particular piece from the Does 1-1058, 752 F.3d 990, 998 (D.C. Cir.
original seeder, and the 2014). Of the three district courts within the
workload of sharing is Fourth Circuit to have addressed the issue,
distributed among a two—the United States District Court for the
District of Maryland and the United States
Page 7 District Court for the Eastern District of
Virginia—have found swarm joinder to be
"swarm" of users. Once a user improper, see I.T. Prods., 2017 WL 167840, at
has downloaded all of the pieces *1 (collecting cases); Cell Film Holdings, 2016
of a file, the client compares the WL 7494319, at *3 (collecting cases), while
hash values of each piece against one—the United States District Court for the
that recorded in the original
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Headhunter, LLC v. Doe (W.D. Va., 2018)

Eastern District of North Carolina—has AF Holdings, 752 F.3d at 998 (internal


permitted swarm quotations and citations omitted).

Page 8 Plaintiff essentially argues that the court


can infer that defendants actually exchanged
joinder, K-Beech, Inc. v. Doe 37, No. 5:11-cv- data amongst themselves because their alleged
381, 2012 WL 12910991, at *2 (E.D.N.C. June copyright infringement of A Family Man took
12, 2012). place during the same swarm during the same
three-week time interval. While the court in
Joining the first two of those district AF Holdings assumed without deciding that
courts, this court concludes that plaintiff's "two individuals who participate in the same
allegations do not support the joinder of nine swarm at the same time are part of the same
unknown and otherwise unrelated defendants. series of transactions within the meaning of
In so doing, the court rejects plaintiff's Rule 20(a)(2)" because they "might well be
argument that defendants' joining a common actively sharing a file with one another," it did
"swarm" to upload or download A Family Man not define what it
satisfies, in and of itself, "the same transaction,
occurrence, or series of transactions or Page 9
occurrences" requirement under Rule
20(a)(2). That defendants uploaded and/or meant by "the same time" and its assumption
downloaded pieces of the same digital copy of was not necessary to its decision. Id.
A Family Man does not necessarily give rise to (emphasis in original). But for the reasons
the inference that their actions are explained below, court concludes that the
transactionally related. This is because of (1) mere fact that the download occurred during
the design of the BitTorrent protocol, and (2) the same swarm—even if it was at the same
the absence of any alleged facts that would time—is, in and of itself, insufficient to support
permit the court to infer an exchange of data joinder.
between these defendants. The D.C. Circuit
provided an analogy that strikingly illustrates Here, the complaint alleges that the
both issues: swarm occurred over a three-week time
interval. Regardless of whether a three-week
[T]wo BitTorrent users who period constitutes "the same time," as
download the same file months referenced in AF Holdings, this interval does
apart are like two individuals not suffice to link defendants together at that
who play at the same blackjack same figurative blackjack table. See Cell Film
table at different times. They Holdings, 2016 WL 7494319, at *3 n.5 (finding
may have won the same amount joinder improper despite allegation that
of money, employed the same copyright infringement occurred over the span
strategy, and perhaps even of one day because "the length of time [of
played with the same dealer, but BitTorrent use is not] dispositive in
they have still engaged in determining the propriety of joinder").
entirely separate transactions. Temporal proximity alone fails to sufficiently
And [s]imply committing the connect swarm-defendants in order to permit
same type of violation in the joinder because "[t]he connectivity is created
same way does not link automatically by the BitTorrent protocol and
defendants together for the not by any acts of the individuals using the
purposes of joinder. protocol." UN4 Prods., Inc. v. Does 1-15, No.
17-2768, 2017 WL 5885779, at *3 (E.D. Pa.
Nov. 29, 2017) (rejecting three-week interval
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Headhunter, LLC v. Doe (W.D. Va., 2018)

argument). Even if defendants were all online remained in the case because there was no
in the swarm at the exact same time, it is showing of any exchange of files between those
possible that any given Doe defendant did not defendants. Patrick Collins, Inc. v. John Does
directly upload or download any piece of the 1-54, No. CV-11-1602-PHX-GMS, 2012 WL
file from or to any of the other defendants 911432, at *5 (D. Ariz. Mar. 19, 2012)
because "[i]t is entirely possible that John Doe (explaining that joinder was impermissible
#1 and third parties A, B, and C, received where "Plaintiff alleges that the two remaining
pieces only from the Initial Seeder and Defendants 'participat[ed] in the BitTorrent
uploaded only to each other, and John Doe #2 swarm with other infringers' but does not
did the same with third parties X, Y, and Z." claim that John Doe 6 provided data to the
UN4, 2017 WL 5885779, at *3. See also former John Doe 12 or vice versa"). Absent
Galang, 2017 WL 5895132, at *4 (rejecting 19- allegations that the Doe defendants shared
day interval argument and emphasizing that data with each other, joinder is impermissible
nothing about the temporal proximity regardless of whether "Plaintiff has limited the
"suggests . . . that these identified defendants action to a reasonable and manageable
acted in concert as part of the same transaction number of [defendants]." (Opp'n at 24.)
or occurrence"). That some of the Doe
defendants allegedly uploaded or downloaded Page 11
a piece of A Family Man during the same
three-week interval Furthermore, even if joinder were proper
under Rule 20(a)(2), Rule 20(b) might
Page 10 support discretionary severance of
defendants. Rule 20(b) provides that a court
does nothing to bolster joinder in the absence may order separate trials "to protect a party
of any allegations that defendants interacted against embarrassment, delay, expense, or
with each other in their exchange of data.4 other prejudice." Fed. R. Civ. P. 20(b). While
the court does not utilize such discretionary
Plaintiff also takes issue with any severance here, it notes that each Doe
argument that "attempts to equate a case defendant is likely to have different and
involving 300 defendants with this case." divergent defenses, CineTel Films, Inc. v. Does
(Opp'n at 18.) But just as with the three-week 1-1, 052, 853 F. Supp. 2d 545, 552 (D. Md.
time interval, the fact that this case involves 2012), and thus severing all but one defendant
nine Doe defendants rather than 300 fails to avoids potential prejudice and unfairness. See
support joinder where only conclusory also Cell Film Holdings, 2016 WL 7494319, at
allegations serve to connect defendants to the *4 (noting the potential to coerce unjust
same data transfer. Because the analysis turns settlements and the purpose of the filing fee in
on whether defendants—however many there support of discretionary severance).
are—engaged in the same transaction or
occurrence, courts have found swarm joinder Finally, plaintiff argues that the issue of
impermissible under Rule 20(a)(2) in similar joinder is better analyzed once defendants
cases involving only four unidentified appear and raise any defenses. (Opp'n at 18-
defendants, Galang, 2017 WL 5895132, at *2- 19.) But defendants' personal identifying
4, and twelve unidentified defendants, Pow information is unnecessary to evaluate
Nevada, LLC v. Doe 2, No. C17-1649RSM, joinder, and this court relies on other courts
2018 WL 525958, at *1 (W.D. Wash. Jan. 24, within the Fourth Circuit where "experience
2018); I.T. Prods., 2017 WL 167840, at *1-2; [regarding later analyzing joinder] has proven
Cell Film Holdings, 2016 WL 7494319, at *3. that the countervailing concerns of 'prejudice,
Indeed, one court found swarm joinder expense, or delay,' see Aleman, 485 F.3d at 218
impermissible where only two defendants n.5, substantially outweigh any convenience."
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Headhunter, LLC v. Doe (W.D. Va., 2018)

I.T. Prods., LLC, 2017 WL 167840, at *2. prejudice. The court understands that the
Because plaintiff fails to allege that Filing Defendant is not John Doe 1, so he
defendants' actions arise out of the same would not remain in the case after the claims
transaction, occurrence, or series of against Doe defendants 2-9 are severed. The
transactions or occurrences, joinder is court will deny the other relief requested in the
improper under Rule 20. motion. The unsigned motion to quash (Dkt.
No. 15), filed by the unknown John Doe
C. Unsigned Motion to Quash defendant, will be struck pursuant to Rule 11.
Because of the ruling as to the motion to sever
The unknown John Doe defendant filed and dismiss (Dkt. No. 25), the court will deny
the unsigned motion to quash. (Dkt. No. 15.) as moot the first motion to quash (Dkt. No. 11).
While the arguments contained in that motion Although the court is not granting any motion
were construed to be adopted by the Filing to quash, because the court is severing the
Defendant, the motion itself cannot stand. claims of the Doe defendants, the court will,
Rule 11 of the Federal Rules of Civil Procedure sua sponte, quash the current subpoena as to
requires that every written motion "must be Doe defendants 2-9. Headhunters will be
signed by at least one attorney of record . . . or directed to notify the recipient of the third-
by a party personally if the party is party subpoena of this ruling.
unrepresented." Any motion that is unsigned
must be struck by Page 13

Page 12 An appropriate order will be entered.

the court unless the omission is corrected Entered: September 21, 2018.
promptly. Fed. R. Civ. P. 11. Here, the court
cannot call the error to the party's attention in /s/
order to have a signed motion filed because the Elizabeth K. Dillon
court does not know who the party is. Thus, the United States District Judge
court will strike the unsigned motion.
--------
Because the court grants the motion to
sever and will dismiss without prejudice the Footnotes:
claims against Doe defendants 2-9, the Filing 1. The court notes that the subpoena
Defendant's first motion to quash (Dkt. No. 11)
identifies the style of the case incorrectly.
is moot.5
Instead of nine Doe defendants, it states that
there are eleven Doe defendants. (Dkt. No. 11-
III. CONCLUSION
2.) The court further notes that it is unclear
For the foregoing reasons, the court will from Exhibit B (Dkt. No. 1-2), attached to the
allow the Filing Defendant to file his motions complaint, about which of the ISP addresses
(Dkt. Nos. 11 and 25) anonymously. The court Headhunter was seeking subscriber
will construe the motion to sever and dismiss information because there are more than nine
with prejudice, motion to dismiss (Dkt. No. listed. The court does not know if this is the
25) as a motion to sever, and it will grant the same Exhibit B that was attached to the
motion only to the extent it seeks severance. subpoena.
Accordingly, plaintiff's claim against John Doe
A delay in ruling on motions is not a
2.
1 will be severed from the claims against Doe
proper ground for recusal, so that request will
defendants 2-9, and the claims against Doe
be denied.
defendants 2-9 will be dismissed without

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Headhunter, LLC v. Doe (W.D. Va., 2018)

3.Plaintiff is not prejudiced by this


construction of the motion in that plaintiff
addressed that possibility and responded to
the arguments in its memorandum in
opposition. (Dkt. No. 27.)

4.According to an article in the Syracuse


Journal of Science & Technology Law, "[a]
swarm can consist of peers from all around the
world, whose only shared characteristic is the
fact that they are all downloading and
uploading the target file." Christopher Civil,
Mass Copyright Infringement Litigation: Of
Trolls, Pornography, Settlement, and
Joinder, 30 Syracuse J. Sci. & L. Tech. L. 2, 10
(2014) (citations omitted). The user does not
connect to all peers within the swarm; rather,
using the BitTorrent protocol, "users are
constantly shifting connections; indeed, they
potentially connect and transfer data with a
new individual every 30 seconds" based upon
download speeds. Id. at 11.

The court notes, however, that although


5.

the Filing Defendant seeks to quash the


subpoena because it "asks that his computer
be inspected or confiscated" (Mot. to Quash 4,
Dkt. No. 11), the subpoena asks for no such
thing. Instead, it seeks as to each IP address
"any and all identifying information," which
"includes, but is not limited to, the business
name and/or first and last name, address,
phone number, and email address."
(Subpoena, Dkt. No. 11-2.)

--------

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EXHIBIT E

Case 3:18-cv-00017-NKM-JCH Document 148-5 Filed 06/06/19 Page 1 of 5 Pageid#: 2324


Gaston v. LexisNexis Risk Sols. (W.D. N.C., 2017)

DELORIS GASTON, et al., Plaintiffs, II. Legal Standard


v.
LEXISNEXIS RISK SOLUTIONS, et al., A district court may certify an order for
Defendants. immediate appeal if "such order involves a
controlling question of law as to which there is
DOCKET NO. 5:16-cv-9 substantial ground for difference of opinion"
and "an immediate appeal from the order may
UNITED STATES DISTRICT COURT materially advance the ultimate termination of
WESTERN DISTRICT OF NORTH the litigation." 28 U.S.C. § 1292(b); see also
CAROLINA STATESVILLE DIVISION United States ex rel. Michaels v. Agape Senior
Cmty., Inc., 848 F.3d 330, 340 (4th Cir. 2017).
November 13, 2017 A question of law refers to "a question of the
meaning of a statutory or constitutional
ORDER provision, regulation, or common law
doctrine" as opposed to an issue of fact. Lynn
THIS MATTER is before the Court on
v. Monarch Recovery Mgmt., 953 F.Supp.2d
defendants' Motion for Certification of an
612, 623 (D. Md. 2013). A controlling question
Interlocutory Appeal Pursuant to 28 U.S.C. § of law is one with an answer that "will be
1292(b). Having considered defendants'
completely dispositive of the litigation, either
motion and reviewed the pleadings, the court as a legal or practical matter." David v. Alphin,
enters the following Order.
2009 U.S. Dist. LEXIS 108413, at *10-11
(W.D.N.C. Oct. 30, 2009) (internal quotations
I. Background
and citations omitted). Alternately, a question
of law may be controlling "even though its
Defendants filed a Motion to Dismiss
disposition might not lead to reversal on
Plaintiff's Class Action Amended Complaint
appeal, if interlocutory reversal might save
(#25) on June 7, 2016. Defendants argued that
time for the district court and time and
the definition of "personal information" under
expense for the litigants." North Carolina ex
the Driver's Privacy Protection Act, 18 U.S.C. §
rel. Howes v. W.R. Peele, Sr. Trust, 889 F.
2721, et seq. ("DPPA"), expressly excludes all
Supp. 849, 853 (E.D.N.C. 1995); see also Riley
"information from vehicular accidents," e.g.,
v. Dow Corning Corp., 876 F. Supp. 728, 731
accident reports, from regulation under the
(M.D.N.C. 1992) ("[t]he core question in the
DPPA. Based on this interpretation,
certification process is whether an immediate
defendants argued that plaintiffs' Amended
reversal of an issue at the appellate level will
Complaint should be dismissed as a matter of
save the parties unnecessary time and
law. It appearing from the face of the Amended
expense"). A substantial grounds for
Complaint that plaintiff had stated a
difference of opinion exists if courts differ on a
cognizable claim, the Rule 12(b)(6) motion
controlling question of law, "creating the need
was summarily denied by Order entered
for an interlocutory appeal to resolve the
September 13, 2017. Defendants now seek
split." Charlotte Commercial Grp., Inc. v. Fleet
certification of an interlocutory appeal from
Nat'l Bank, 2003 U.S. Dist. LEXIS 5392, at *8
that Order, seeking clarification of the
(M.D.N.C. Mar. 13, 2003) (citations omitted).
definition of "personal information" and a
determination of what information in an
Page 3
accident report falls within the DPPA's
exclusions.
The decision of whether to certify is
"wholly within the discretion of the district
Page 2
court" and the district court is afforded "great
flexibility . . . in deciding whether to certify an
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Gaston v. LexisNexis Risk Sols. (W.D. N.C., 2017)

order for appeal." Howes, 889 F. Supp. at 852. that plaintiffs had stated a cognizable cause of
However, given basic policy of postponing action. In sum, when ruling on a Rule 12(b)(6)
appellate review until after the court has motion, "a judge
entered final judgment in the case, the movant
bears the burden of persuading the court that Page 4
"exceptional circumstances" justify a
departure from that policy. Fisons Ltd. v. must accept as true all of the factual
United States, 458 F.2d 1241, 1248 (7th Cir.), allegations contained in the complaint."
cert. denied, 405 U.S. 1041 (1972); see also Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per
James v. Jacobson, 6 F.3d 233, 237 (4th Cir. curiam) (citations omitted). A complaint
1993) ("[P]iecemeal review of decisions that "need only give the defendant fair notice of
are but steps toward final judgments on the what the claim is and the grounds upon which
merits are to be avoided, because they can be it rests." Id. at 93 (alteration and internal
effectively and more efficiently reviewed quotation marks omitted). However, to
together in one appeal from the final survive a motion to dismiss, the complaint
judgments."). must "state[ ] a plausible claim for relief" that
"permit[s] the court to infer more than the
III. Discussion mere possibility of misconduct" based upon
"its judicial experience and common sense."
Interlocutory appeals should not be Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). To
certified unless a court is "of the opinion that survive a motion to dismiss, a plaintiff need
such order involves a controlling question of not demonstrate that her right to relief is
law as to which there is a substantial ground probable or that alternative explanations are
for difference of opinion." 28 U.S.C. § 1292(b). less likely; rather, a plaintiff must merely
The definition that defendants ask this Court advance their claim "across the line from
to certify for clarification is, as follows: conceivable to plausible." Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). If a
"personal information" means plaintiff's explanation is plausible, the
information that identifies an complaint survives a motion to dismiss under
individual, including an Rule 12(b)(6), regardless of whether there is a
individual's photograph, social more plausible alternative explanation. "[A]
security number, driver well-pleaded complaint may proceed even if it
identification number, name, strikes a savvy judge that actual proof of those
address (but not the 5-digit zip facts is improbable, and that a recovery is very
code), telephone number, and remote and unlikely." Id. at 556. Failure to
medical or disability state a claim can occur two ways: first, by
information, but does not failing to state a valid legal cause of action, i.e.,
include information on vehicular a cognizable claim, see Holloway v. Pagan
accidents, driving violations, River Dockside Seafood, Inc., 669 F.3d 448,
and driver's status. 452 (4th Cir. 2012); or second, by failing to
allege sufficient facts to support a legal cause
18 U.S.C. § 2725(3). of action, see Painter's Mill Grille, LLC v.
Brown, 716 F.3d 342, 350 (4th Cir. 2013).
In this case, defendants earlier contended Here, plaintiff states a cognizable claim as
that this action should be dismissed for failure previously determined.
to state claim based on a reading of that statute
which, they contend, would make plaintiff's The only issue now pending is whether
allegations non-cognizable. This Court this Court should exercise its discretion and
summarily denied that motion as it was clear certify its Rule 12(b)(6) cognizability
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determination for interlocutory appeal to the information, from a motor


Fourth Circuit. This Court would give serious vehicle record, for a purpose not
consideration to certifying an interlocutory permitted under [the DPPA]."
appeal where there is split among judges of the Id. § 2724(a). In accordance with
district courts of the Fourth Circuit or where it "one of the most basic
is arguable among reasonable interpretive canons" of statutory
interpretation, "[a] statute
Page 5 should be construed so that
effect is given to all its
jurists that this Court's determination was provisions, so that no part will be
wrong. Here, except for one outlier,1 this Court inoperative or superfluous, void
can find no split among the courts that have or insignificant." Corley v.
addressed this precise issue. Indeed, this United States, 556 U.S. 303, 314
Court's determination is fully consistent with a (2009) (alteration in original)
recent decision of a colleague in the Middle (quoting Hibbs v. Winn, 542
District of North Carolina, the Honorable U.S. 88, 101 (2004)).
Loretta C. Biggs, United States District Judge, Accordingly, giving effect to the
where she held as follows: entire statute, including section
2721(a) on which Defendants
The Farbman Defendants rely, as well as section 2724(a),
further argue that they cannot be the Court concludes that the
held liable under the DPPA DPPA covers information
because "the statute simply does knowingly disclosed by a state
not apply to Defendants' DMV as well as information that
conduct, even if the allegations is knowingly obtained, disclosed,
in the ... Complaint are taken as or used by any person. Nowhere
true," and the Complaint, in the statute does it state that it
therefore, fails to state a claim. applies so as to limit liability in
(ECF No. 22 at 18.) In particular, the manner argued by
the Farbman Defendants, citing Defendants. As such, the Court
to section 2721(a)(1) of the denies Defendants' motions to
statute, assert that "[t]he DPPA dismiss for failure to state a
only regulates the disclosure of claim on this basis.
information held by a state
DMV." (Id. at 18-19.) Hatch v. Demayo, 1:16CV925, 2017 WL
The Court rejects these 4357447, at *7 (M.D.N.C. Sept. 29,
arguments, which fly in the face 2017)(footnote omitted). In addition, Judge
of the precise language of the Biggs specifically addressed the accident
DPPA. To be sure, section report exception, as follows:
2721(a)(1) of the DPPA prohibits
the knowing use or disclosure of Although Defendants seek to
protected "personal characterize the information
information" by State DMVs, as they obtained and used as
well as their employees and "information on vehicular
agents. 18 U.S.C. § 2721(a)(1). accidents," Plaintiffs specifically
However, section 2724(a) of the allege that Defendants violated
statute also ascribes liability to the statute by impermissibly
anyone "who knowingly obtains, obtaining and using their names
discloses or uses personal and addresses, (see ECF No. 5 ¶¶
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33-36, 45-48, 54-59), "not [by] IT IS, THEREFORE, ORDERED that


obtaining ... information related defendants' Motion for Certification of an
to the accident (e.g., vehicles Interlocutory Appeal Pursuant to 28 U.S.C. §
involved, road conditions, times 1292(b) (#36) is DENIED.
of day, etc.)," Pavone v.
Meyerkord & Meyerkord, LLC, Signed: November 13, 2017
118 F. Supp. 3d 1046,
/s/_________
Page 6 Max O. Cogburn Jr.
United States District Judge
1050 (N.D. Ill. 2015). Plaintiffs'
allegations, therefore, concern --------
Defendants' conduct with
respect to Plaintiffs' names and Footnotes:
addresses, which is information
Mattivi v. Russell, No. CIV.A. 01-WM-
1.
explicitly included in the
533(BNB), 2002 WL 31949898, at *4 (D.Colo.
definition of "personal
Aug. 2, 2002).
information" protected under
the DPPA. Accordingly, the 2.See Senne v. Village of Palatine, Ill., 695
Court finds that it need not look F.3d 597 (7th Cir. 2012); Pichler v. UNITE, 542
any further than the plain F.3d 380, 391 (3d Cir. 2008); Pavone, supra;
language of the statute to St. Clair v. Capital One Bank (USA), N.A., No.
conclude that it applies to CIV. 12-1572 MJD/AJB, 2013 WL 1110810, at
Defendants' underlying conduct *5 (D. Minn. Jan. 22, 2013), rejected in part on
as alleged in the Complaint, and other grounds, No. CIV. 12-1572 MJD/AJB,
Defendants' motions to dismiss 2013 WL 1110803 (D. Minn. Mar. 18, 2013);
on this ground will be denied. Camara v. Metro-N. R. Co., 596 F. Supp. 2d
517, 525 (D. Conn. 2009).
Id. at *8. This Court fully concurs with its
learned colleague in the Middle District. --------
Further, the Hatch determination is fully
consistent with the vast majority of cases
addressing this issue nationwide.2

Applying a modicum of common sense to


what is a clearly written statute, being involved
in a fender bender on the way to work is clearly
an insufficient reason to expose protected
"personal information" (especially a person's
name and home address) to a web audience
increasingly inhabited more by identity
thieves than boy scouts. Rather than certify
what would most likely be a futile and
expensive interlocutory appeal, the Court will
allow defendants to revisit the legal issue at
summary judgment, but only after the close of
discovery.

ORDER
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EXHIBIT F

Case 3:18-cv-00017-NKM-JCH Document 148-6 Filed 06/06/19 Page 1 of 4 Pageid#: 2329


Lafleur v. Dollar Tree Stores, Inc. (E.D. Va., 2014)

MARINA LaFLEUR, ET AL. Plaintiffs, Section 1292(b) of Title 28 of the United


v. States Code allows a district judge to certify his
DOLLAR TREE STORES, INC. or her order for appellate review when the
Defendant. order "involves a controlling question of law as
to which there is substantial ground for
CIVIL ACTION NO.: 2:12-cv-00363 difference of opinion and that an immediate
appeal from that order may materially advance
UNITED STATES DISTRICT COURT the ultimate termination of the litigation." 28
FOR THE EASTERN DISTRICT OF U.S.C. 1292(b).
VIRGINIA Norfolk Division
Page 2
Dated: May 20, 2014
The decision to certify issues for interlocutory
MEMORANDUM ORDER appeal rests wholly within the discretion of the
district court. McDaniel v. Mehfoud, 708 F.
Before the Court is Defendant's Motion Supp. 754, 756 (E.D. Va. 1989). However, the
for Certification of Interlocutory Appeal and United States Court of Appeals for the Fourth
Stay of Order Denying Decertification (ECF Circuit ("Fourth Circuit") has ruled that the
No. 456). In the Motion, Defendant moves the procedural requirements for interlocutory
Court to certify for interlocutory appeal three appeal under Section 1292(b) are to be strictly
questions related to the March 7, 2014 Order construed and applied. Myles v. Laffitte, 881
denying certification, which Defendant argues F.2d 125,127 (4th Cir. 1989) (citing Milbert v.
are appropriate for review: Bison Lab., Inc., 260 F.2d 431 (3d Cir. 1958)).
Furthermore, "given the basic policy of
(1) Whether evidence of how
postponing appellate review until after the
many hours individual plaintiffs
court has entered final judgment in the case, §
worked and evidence of their pay
1292(b) clearly places on the movant the
rates is relevant to liability, not
burden of persuading the court that
just damages, in a Fair Labor
'exceptional circumstances' justify departure
Standards Act ("FLSA") case,
from that policy." North Carolina ex rel.
and therefore must be
Howes v. W.R. Peek, Sr. Trust, 889 F.Supp.
considered on a motion to
849, 853 (E.D.N.C. 1995) (citations omitted).
decertify a collective action.
(2) Whether variations in Defendant has not met its burden of
damages among plaintiffs are establishing exceptional circumstances to
relevant to decertification of a justify certification of interlocutory appeal
collective action. because its questions do not satisfy the
(3) Whether a court can certify a controlling question of law requirement for
collective action where some early appellate review. See Atlantic Textile
managers follow a policy against Grp., Inc. v. Neal, 191 B.R. 652, 653 (E.D. Va.
off-the-clock work, but others do 1996) (citing 28 U.S.C. § 1292(b)) (holding
not, and plaintiffs' claims are that to determine whether to exercise its
subject to "varied discretion to certify for interlocutory appeal,
circumstances," a "combination the order must pertain to a "controlling
of practices" and "factual question of law"); see also Fannin v. CSX
differences." Transp, Inc., No. 88-8120, 1989 WL 42583, at
*5 (4th Cir. April 26, 1989) (noting that a
See Def.'s Mem. In Supp. 1-2, ECF No. 457.
controlling question of law is "a narrow
question of pure law whose resolution will be
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Lafleur v. Dollar Tree Stores, Inc. (E.D. Va., 2014)

completely dispositive of the litigation, either and related questions are inappropriate for
as a legal or practical matter, whichever way it interlocutory review.
goes.").
Second, not only has Defendant failed to
First, Defendant's proposed questions are present pure questions of law, Defendant has
not pure questions of law; rather, they would not established that its questions are
require the Fourth Circuit to study the record "controlling." A question of law is not
extensively. "[T]he term 'question of law' in controlling if litigation will "necessarily
section 1292(b) refers 'to a question of the continue regardless of how that question [is]
meaning of a statutory or constitutional decided." North Carolina ex rel. Howes, 889
provision, regulation, or common law F. Supp. at 853. Here, the Court never
doctrine.'" In re Text Messaging Antitrust determined that the issues presented by
Litig., 630 F.3d 622, 626 Defendant's questions-hours worked, pay
rates, damage variations or varied
Page 3 circumstances-were irrelevant to the
decertification analysis. Instead, the Court
(7th Cir. 2010) (quoting Ahrenholz v. Bd. of found these issues relevant but not
Trustees of Univ. of Illinois, 219 F.3d 674, 676 determinative of whether the proposed class
(7th Cir. 2000)). "[A] pure question of law [is] shared common issues
something the court of appeals could decide
quickly and cleanly without having to study the Page 4
record." Id. at 625-26. However, questions
requiring the court of appeals to hunt through central to the disposition of the FLSA claims
the record are not appropriate for and whether such common issues can be
interlocutory appeal. See id. at 626 (holding substantially adjudicated without
that a question is not a controlling question of consideration of particularized facts. In other
law if the court of appeals is required to review words, the Court held that the differences in
findings of fact or application of legal hours, pay rate, damages and circumstances
standards to set of facts). Defendant's would not preclude a finding that opt-in
questions constitute a challenge to the plaintiffs were similarly situated in terms of
correctness of this Court's application of the the core issue in the case, whether a practice of
"similarly situated" standard under the allowing off-the-clock work existed in Dollar
specific facts of this case. Resolving these Trees Stores that made the performance of
questions would require the Fourth Circuit to uncompensated work possible in violation of
review the record to determine the level of the FLSA. The highly fact-intensive nature of
consideration the Court should have given the inquiry required infers that even a ruling in
certain factual information within its weighing favor of Defendant on appeal may not
of the fact-intensive multifactor "similarly terminate this case. While an issue need not be
situated" standard. See Morgan v. Family dispositive in order to be controlling,
Dollar Stores, Inc., 551 F.3d 1233, 1262 (11th Defendant has not established that the
Cir. 2008) ("[U]ltimately, whether a collective resolution of its questions on appeal would
action is appropriate depends largely on the "materially affect the outcome of litigation"
factual question of whether the plaintiff because the Court's decision to deny
employees are similarly situated to one decertification was based on a relative
another."). Because the Fourth Circuit would weighing of facts in the record beyond those
be required to consider the particular facts and Defendant moves to challenge on appeal. In re
claims of the case if the proposed questions are Cement Antitrust Litig., 673 F.2d 1020, 1026
certified for appeal, the decertification order (9th Cir. 1982) (citing U.S. Rubber Co. v.
Wright, 359 F.2d 784, 785 (9th Cir. 1966)).
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Lafleur v. Dollar Tree Stores, Inc. (E.D. Va., 2014)

Having considered the foregoing analysis


under Section 1292(b), the Court does not find
it appropriate to certify its March 7, 2014
Order for appeal, and Defendant's Motion for
Certification for Interlocutory Appeal and to
Stay Order Denying Decertification is
DENIED. Since the Court declines to issue
certification for interlocutory appeal, there is
no reason proceedings in this case should be
stayed.

The Clerk is DIRECTED to send a copy


of this Memorandum Order to counsel and
parties of record.

IT IS SO ORDERED.

Norfolk, Virginia
May 20, 2014

__________
Raymond A. Jackson
United States District Judge

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EXHIBIT G

Case 3:18-cv-00017-NKM-JCH Document 148-7 Filed 06/06/19 Page 1 of 9 Pageid#: 2333


Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm'n (D. Md., 2015)

THE COALITION FOR EQUITY AND extension of time to respond to the Coalition's
EXCELLENCE IN remedial proposal. For the reasons that follow,
MARYLAND HIGHER EDUCATION, et the court will grant the motion for a certificate
al. of appealability, deny the motion to stay, and
v. grant the motion for an extension.
MARYLAND HIGHER EDUCATION
COMMISSION, et al. BACKGROUND

Civil No. CCB-06-2773 The Ruling, issued on October 7, 2013,


examined three policies of the Maryland
UNITED STATES DISTRICT COURT system of higher education allegedly traceable
FOR THE DISTRICT OF MARYLAND to the era of de jure segregation: (1) limited
institutional missions of historically black
June 29, 2015 institutions of higher education ("HBIs") as
compared to traditionally white institutions
MEMORANDUM ("TWIs"); (2) operational funding deficiencies
at HBIs; and (3) unnecessary program
Plaintiff The Coalition for Equity and duplication between HBIs and TWIs. The
Excellence in Maryland Higher Education and court found that the Coalition failed to prove
named individuals associated with the that "any current operational funding or
organization ("the Coalition") sued the State of mission related policy or practice" was
Maryland, the Maryland Higher Education traceable to the de jure era, but succeeded in
Commission, and its officers in their official proving that the State had "failed to eliminate
capacities (collectively, "the State") alleging the traceable de jure era policy of unnecessary
violations of Title VI of the Civil Rights Act of program duplication for Maryland's HBIs."
1964 and the Equal Protection Clause of the Coal. for Equity & Excellence, 977 F. Supp. 2d
Fourteenth Amendment. After a bench trial, at 524. The court "strongly suggest[ed] that the
the court issued an opinion containing parties enter mediation to attempt to generate
findings of fact and conclusions of law ("the a suitable plan to address" the problem of
Ruling"), and holding that under United States unnecessary program duplication, id. at 544,
v. Fordice, 505 U.S. 717 (1992), unnecessary and on October 31, 2013, they agreed to
program duplication within Maryland's mediation with Judge Paul Grimm, (Letter to
system of higher education continues to have Counsel, ECF No. 385). Mediation
segregative effects for which the State has no commenced in January 2014 and continued
sound educational justification. Coal. for for over a year. Despite Judge Grimm's
Equity & Excellence in Md. Higher Educ. v. substantial efforts, however, the parties were
Md. Higher Educ. Comm'n, 977 F. Supp. 2d unable to agree on an appropriate plan.
507 (D. Md. 2013). At the court's suggestion,
the parties then engaged in mediation to On May 4, 2015, one day before the
determine an appropriate remedy. That Coalition's proposed remedies were due to be
mediation recently culminated without the filed, the State moved to certify an
parties having reached an agreement. The interlocutory appeal of the Ruling. In a
State has now moved for a certificate of separate motion filed that same day, the State
appealability as to the Ruling, to stay the moved to stay all proceedings other than those
remainder of the case, and for an related to the motion to certify and to stay all
proceedings if the court ultimately granted
Page 2 that motion. The Coalition filed its

Page 3
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Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm'n (D. Md., 2015)

proposed remedies on May 5, 2015. On May 15, however, That application for an
2015, the State moved for an extension of time appeal hereunder shall not stay
to respond to the Coalition's proposed proceedings in the district court
remedies. The Coalition then filed oppositions unless the district judge or the
to each of the State's motions. On May 27, Court of Appeals or a judge
2015, the court issued a letter indicating that thereof shall so order.
the motion for an extension would be granted,
at least in part, depending on the resolution of 28 U.S.C. § 1292(b). Thus, certification of an
the other pending motions. interlocutory appeal under § 1292(b) is
appropriate where a district court makes an
ANALYSIS order, and "(1) the order to be appealed
involves a controlling question of law; (2)
I. Motion to Certify Interlocutory there is substantial ground for difference of
Appeal opinion on that

"The Interlocutory Appeals Act of 1958, Page 4


28 U.S.C. § 1292(b), was enacted to meet the
recognized need for prompt review of certain question of law; and (3) an immediate appeal
nonfinal orders." Coopers & Lybrand v. from the order may materially advance the
Livesay, 437 U.S. 463, 474 (1978) (footnote ultimate termination of the litigation." In re
omitted); see also Kennedy v. Villa St. Microsoft Corp. Antitrust Litig., 274 F. Supp.
Catherine, Inc., No. PWG-09-3021, 2010 WL 2d 741, 741 (D. Md. 2003).2 But interlocutory
9009364, at *1 (D. Md. June 16, 2010)1 (noting appeal under § 1292(b) is the exception, not
that the "purpose behind the exception" to the the rule. Accordingly, it "should be used
normal appeals process "is to avoid sparingly," Myles v. Laffitte, 881 F.2d 125, 127
unnecessary litigation" (citation omitted)). (4th Cir. 1989), and the party seeking its
Section 1292(b) provides, in full, as follows: application must persuade the court that
"exceptional circumstances justify a departure
When a district judge, in making from the basic policy of postponing appellate
in a civil action an order not review until after the entry of a final
otherwise appealable under this judgment." Coopers & Lybrand, 437 U.S. at
section, shall be of the opinion 475 (citation omitted).
that such order involves a
controlling question of law as to The State argues that all the requirements
which there is substantial of § 1292(b) are met here, and interlocutory
ground for difference of opinion review is appropriate. The Coalition responds
and that an immediate appeal that this case is not "exceptional," the Ruling is
from the order may materially not an "order" within the meaning of §
advance the ultimate 1292(b), that section's other requirements are
termination of the litigation, he not met, and the State unreasonably delayed
shall so state in writing in such the filing of its motion to certify. I agree with
order. The Court of Appeals the State.
which would have jurisdiction of
an appeal of such action may A. Whether This Case Presents
thereupon, in its discretion, Exceptional Circumstances
permit an appeal to be taken
from such order, if application is Interlocutory review under § 1292(b) is
made to it within ten days after limited to exceptional circumstances. Coopers
the entry of the order: Provided, & Lybrand, 437 U.S. at 475. As the State notes,
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Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm'n (D. Md., 2015)

the Ruling "constitute[d] the first time since Court looked to the predecessor statute to §
the early 1990s that any district court in the 1292(c) and examined whether a patent ruling
United States has had occasion to issue a which was labeled an "order" qualified as a
ruling on liability in a case involving issues of "decree." Id. at 98. The Court held that the
desegregation in public higher education." district court's labeling of the ruling was "not
(State's Mot. Certify 8, ECF No. 404.) This case of crucial significance" because its "binding
presents exceptional circumstances. effect in disposing of the question before it is
the same as though it had been entitled a
B. Whether the Ruling is an "Order" 'decree.'" Id. at 99. Other cases agree that a
functional approach is appropriate. See
By its terms, § 1292(b) allows the Birmingham Fire Fighters Ass'n 117 v.
interlocutory appeal only of an "order." The Jefferson Cnty., 280 F.3d 1289, 1292-95 (11th
Coalition argues that the Ruling contained no Cir. 2002) (applying a "functional approach"
order. Rather, the Coalition points out that the and "looking not to the form of the district
Ruling "propose[d] to defer entry of judgment court's order but to its actual effect" in
pending mediation or further proceedings if examining whether, under § 1292(a), a district
necessary to court's interpretation of a consent decree
"modified" an injunction so as to render it
Page 5 appealable under

establish an appropriate remedy." 977 F. Supp. Page 6


2d at 544. The State responds that the Ruling
was an order in substance and effect because it that provision (citation omitted)); Link v.
disposed of the question before it, and if there Mercedes-Benz of N. Am., Inc., 550 F.2d 860,
were any doubt the court could "issu[e] a 863 (3d Cir. 1977) ("These orders [under §
revised order clarifying that the findings of fact 1292(b)] must be definitive, effective, and in a
and conclusions of law are to be treated as an posture capable of affirmance or reversal.").
order of the Court." (State's Reply in Support
of Mot. Certify 3, ECF No. 415.) The State argues that the Ruling had the
actual effect of adjudicating the State's liability
No definitive definition of order appears definitely, effectively, and in a posture capable
to exist to which the court must look here. The of affirmance or reversal, and should thus be
State points to a portion of the Black's Law construed as an order. The State further
Dictionary definition in which "order" is argues that the Ruling had the same actual
defined as a "written direction or command" effect as orders appealed under § 1292(b) in
and a "determination of the court upon some other high-stakes desegregation cases before
subsidiary . . . matter arising in an action." the remedies were determined. See Gratz v.
Order, Black's Law Dictionary (10th ed. 2014). Bollinger, 122 F. Supp. 2d 811, 836 (E.D. Mich.
The State says the Ruling is a "written 2000) (ruling on motions for summary
direction or command" and a "determination judgment); Bradley v. Milliken, 338 F. Supp.
of the court upon some subsidiary . . . matter 582, 594-95 (E.D. Mich. 1971) (ruling after
arising in an action," and should therefore be trial).
viewed as an order.
The Coalition's lone authority in support
The State also cites several cases that of its position is In re Community Bank of
applied a functional approach to determining Northern Virginia, 622 F.3d 275 (3d Cir.
whether a ruling is susceptible to interlocutory 2010). There, the court noted that "the District
review. In McCullough v. Kammerer Corp., Court could not have certified its 2006
331 U.S. 96 (1947), for example, the Supreme Memorandum for appellate review under 28
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U.S.C. § 1292(b) or Federal Rule of Civil requirements of § 1292(b) have been met. See
Procedure 54(b), as it was an interlocutory Fed. R. App. P. 5(a)(3).
ruling on a question of law, not an order or a
judgment." Id. at 314 n.35. But as the State C. Whether the Ruling Involves a
points out, Community Bank involved the Controlling Question of Law
attempted settlement of a class action, and the
memorandum addressed whether certain "The term 'question of law,' for purposes
claims the plaintiffs had failed to assert "could of § 1292(b), refers to 'a question of the
have survived a Rule 12(b)(6) motion to meaning of a statutory or constitutional
dismiss." Id. at 288. In the State's words, that provision, regulation, or common law
memorandum thus consisted of "the most doctrine'—as opposed to 'whether the party
purely advisory and academic exercise a court opposing summary judgment had raised a
could ever take." (State's Reply in Support of genuine issue of material fact.'" Lynn v.
Mot. Certify 6.) See also Linton v. Shell Oil Co., Monarch Recovery Mgmt., Inc., 953 F. Supp.
563 F.3d 556, 557 (5th Cir. 2009) ("[S]ection 2d 612, 623 (D. Md. 2013) (quoting Clark
1292(b) authorizes certification of orders for Constr. Grp., Inc. v. Allglass Sys., Inc., No.
interlocutory appeal, not certification of DKC-02-1590, 2005 WL 736606, at *2 (D. Md.
questions."); 16 Charles Alan Wright et al., March 30, 2005)). And though a "controlling"
Federal Practice and Procedure § 3930 (3d ed. question of law clearly includes every order
that, "if erroneous, would be reversible error
Page 7 on final appeal," id. (citing Katz v. Carte

2012) (noting that an order appealable under Page 8


§ 1292(b) should "raise issues that are ripe for
appellate review"). Blanche Corp., 496 F.2d 747, 755 (3d Cir.
1974)), a question also may be controlling "if
Unlike the memorandum in Community interlocutory reversal might save time for the
Bank, the Ruling is not merely a "ruling on a district court, and time and expense for the
question of law." Rather, it was the litigants," 16 Wright et al., Federal Practice &
culmination of the liability phase of the case. Procedure § 3930.
Community Bank therefore does little to
support the Coalition's argument. Regardless, "Decisions holding that the application of
however, the Coalition's argument that the a legal standard is a controlling question of law
Ruling should not be construed as an within the meaning of section 1292(b) are
appealable order places form over substance: numerous." In re Text Messaging Antitrust
the Ruling was this court's final adjudication of Litig., 630 F.3d 622, 626 (7th Cir. 2010); see,
the State's liability in this case, and it is clearly e.g., Florence v. Bd. of Chosen Freeholders of
susceptible to appellate review. Further, given Cnty. of Burlington, 621 F.3d 296, 301 (3d Cir.
that the remaining requirements of § 1292(b) 2010) ("The District Court certified the
are met, the Coalition's formalistic approach following question for our review: 'whether a
would seem to frustrate the purpose of § blanket policy of strip searching all non-
1292(b). The court thus rejects the Coalition's indictable arrestees admitted to a jail facility
argument that the Ruling was not an "order" without first articulating reasonable suspicion
within the meaning of § 1292(b). violates the Fourth Amendment of the United
States Constitution as applied to the States
Nonetheless, to avoid any uncertainty the through the Fourteenth Amendment.'").
court is today entering an order incorporating Though "routine applications of well-settled
the findings of fact and conclusions of law legal standards" are not appropriate for
contained in the Ruling and finding that the interlocutory appeal, under certain
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Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm'n (D. Md., 2015)

circumstances even a question as prosaic as 1438 (4th Cir. 1989) (per curiam)
whether a complaint states a claim has been (unpublished), on which the Coalition places
held to satisfy this standard. See Text substantial reliance. Fannin included some
Messaging Antitrust Litig., 630 F.3d at 624- strong language limiting the scope of §
27 (addressing the application of post- 1292(b). See id. at *5 ("[T]he kind of question
Twombly pleading standards to a Sherman best adapted to discretionary interlocutory
Act complaint). review is a narrow question of pure law whose
resolution will be completely dispositive of the
The State frames the central controlling litigation, either as a legal or practical matter,
question of law here as "[t]he correct legal whichever way it goes."). Ultimately, however,
analysis for determining whether, despite it merely found that the defendant sought
having fully desegregated its TWIs, [it] can be interlocutory review of the denial of its
held liable based on a finding of unnecessary summary judgment motion, and such review
program duplication[.]" (State's Mot. Certify was not appropriate. See id. ("[I]t appears that
14.) The Coalition says this question is merely the only question that we properly might
another way of asking whether the court consider on an interlocutory appeal of this
misapplied settled law to the facts, and is order would simply be whether the district
therefore not a "controlling question of law" court erred in concluding that summary
under § 1292(b). More specifically, the judgment for CSX was not warranted . . . .").
Coalition argues that what the State really Appellate review of this case would not involve
wants is for the Fourth Circuit to reexamine a hunt for disputed issues of material fact.
this court's application of Fordice. But Rather, the State seeks to challenge the
whether, under Fordice, a state can be held application of Fordice to facts that have now
been found, and "there is no doctrine
Page 9 [concerning § 1292(b)] counseling courts to
avoid
liable for unnecessary program duplication
despite having fully desegregated its TWIs is Page 10
certainly a question of law, and that question
is potentially controlling here. The "multiple ruling on legal issues involving undisputed
issues subsumed within that question" are facts that are before them." Kennedy v. St.
more fact-dependent, (see State's Mot. Certify Joseph's Ministries, Inc., 657 F.3d 189, 195
10-14 (setting out six Fordice-related issues (4th Cir. 2011). Accordingly, the State has
that turn on the facts of this case), and the demonstrated the existence of a controlling
Fourth Circuit may or may not address them question of law.
all. In either case, the Ruling involves a
controlling question of law. D. Whether There is Substantial
Ground for Difference of Opinion
It is true, as the Coalition points out, that
some cases refer to "a pure question of law, A substantial ground for difference of
something the court of appeals could decide opinion may exist where there is "a dearth of
quickly and cleanly without having to study the precedent within the controlling jurisdiction
record[.]" Ahrenholz v. Bd. of Trustees of and conflicting decisions in other circuits," or
Univ. of Ill., 219 F.3d 674, 677 (7th Cir. 2000) "where a court's challenged decision conflicts
(emphasis added). But that standard is with decisions of several other courts." APCC
generally recited to justify denying Servs., Inc. v. Sprint Commc'ns Co., 297 F.
interlocutory appeal on a summary judgment Supp. 2d 90, 97-98 (D.D.C. 2003). "The level
ruling. See, e.g., id. Such was the case in of uncertainty required to find a substantial
Fannin v. CSX Transportation, Inc., 873 F.2d ground for difference of opinion should be
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Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm'n (D. Md., 2015)

adjusted to meet the importance of the the court finds that there is substantial ground
question in the context of the specific case." 16 for difference of opinion sufficient to justify an
Wright et al., Federal Practice & Procedure § interlocutory appeal.
3930.
E. Whether an Immediate Appeal
The State points to the lack of Fourth Would Materially Advance the Ultimate
Circuit precedent concerning Fordice, and Termination of the Litigation
argues that substantial ground for difference
of opinion arises from the fact that, at least in "In determining whether certification will
the State's view, the Ruling's analysis differs materially advance the ultimate termination of
from that of Fordice and the Ayers decision3 the litigation, a district court should consider
implementing it. (See State's Mot. Certify 17- whether an immediate appeal would: '(1)
18 (detailing examples of where the Ruling eliminate the need for trial, (2) eliminate
supposedly deviated from Fordice and Ayers). complex issues so as to simplify the trial, or (3)
The State further argues that this element of § eliminate issues to make discovery easier and
1292(b) is established by the fact that the less costly.'" Lynn, 953 F. Supp. 2d at 626
Ruling's conclusions differ from the "complex (citation omitted).
educational judgments" of State officials. (Id.
at 19.) The trial in this case has already taken
place. The State argues, however, that this
In response, the Coalition argues that the element of § 1292(b) is satisfied where, as here,
State's own view as to its liability does not reversal could result in dismissal of the entire
establish substantial ground for difference of action. See In re Travelstead, 250 B.R. 862,
opinion. See Nat'l Cmty. Reinvestment Coal. 866 (D. Md. 2000) ("Reversal of the
v. Accredited Home Lenders Holding Co., 597 Bankruptcy Court's Order would result in
F. Supp. 2d 120, 122 (D.D.C. 2009) ("Mere dismissal of the entire action. Accordingly, the
disagreement, even if vehement, with a court's third requirement is met."). The State further
ruling does not establish a substantial ground argues that even if the case is not reversed, an
for appeal "is likely to

Page 11 Page 12

difference of opinion sufficient to satisfy the provide guidance that will help clarify the
statutory requirements for an interlocutory issues" to be resolved during the remedies
appeal."). The Coalition also seeks to refute the phase, thus "possibly averting the need for a
State's contention that the analysis in the future appeal." (State's Mot. Certify 20.) The
Ruling differed from that in Fordice and Coalition responds that an interlocutory
Ayers. appeal would prolong the litigation, and result
in multiple appeals should the parties appeal
The court is confident in the correctness of later. See Winstead v. United States, 863 F.
the Ruling's conclusions, but the Fourth Supp. 264, 269 (M.D.N.C. 1994) ("Certifying
Circuit has never examined Fordice. Though a the action for review before damages have
case of first impression within a circuit is not been determined would likely result in one
generally sufficient to establish this element of appeal on the liability issue and a separate
§ 1292(b), the State believes the Ruling appeal on the damages issue. Creating a
misinterpreted Fordice in such a way as to situation necessitating two separate appeals is
conflict with it, and the other criteria for a waste of judicial resources and should be
interlocutory appeal are satisfied.4 Within the avoided if possible.").
context of this extraordinarily important case,
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A reversal by the Fourth Circuit could The State has also moved to stay the case
advance the litigation by ending it. And if the pending resolution of the motion to certify,
Fourth Circuit does not reverse, it may clarify and if the court grants the motion to certify, to
the issues in such a way as to assist this court stay all proceedings pending resolution of the
in examining the parties' remedial proposals, appeal. The court will deny the first request as
which are much more complex than a moot. As to the second request, § 1292(b)
monetary damages calculation. Accordingly, provides that certification of an interlocutory
the court finds that this element is satisfied. appeal "shall not stay proceedings"
automatically; rather, a district judge must "so
F. Whether the State's Motion to order." 28 U.S.C. § 1292(b). "The grant or
Certify Is Timely denial of a request to stay proceedings calls for
an exercise of the district court's judgment 'to
The only express time limitation in § balance the various factors relevant to the
1292(b) provides that the party seeking an expeditious and comprehensive disposition of
interlocutory appeal must, within ten days of the causes of action on the court's docket.'"
the district court's order certifying the appeal, Maryland v. Universal Elections, Inc., 729
file an application with the appellate court. F.3d 370, 375 (4th Cir. 2013) (citation
Some courts have found, however, that omitted).
"[t]here is also a nonstatutory requirement:
the petition must be filed in the district court The State argues that a stay is warranted
within a reasonable time after the order here because "[e]ven if the result of the
sought to be appealed," Ahrenholz, 219 F.3d at interlocutory appeal does not end the case, . . .
675, and "a district judge should not grant an the appellate court's ruling is likely to provide
inexcusably dilatory request," Richardson guidance that will need to be applied on
Electronics, Ltd. v. Panache Broad. of Pa., remand to this Court." (State's Mot. Stay 2,
Inc., 202 F.3d 957, 958 (7th Cir. 2000). ECF No. 405.) The State adds that
"[p]roceeding with litigation of remedies
The parties were engaged in mediation before the appellate court has an opportunity
until recently, and the timing of the State's to rule would be a waste of judicial resources
motion was reasonable and not inexcusably and would work a disservice to the people of
dilatory. None of the cases cited by the Maryland." (State's Reply in Support of Mot.
Coalition address a Certify 19.) The Coalition responds that
allowing the remedies phase to continue is the
Page 13 most efficient means of handling this case.

situation like this one, where the delay was Page 14


attributable solely to the failure of mediation.
Accordingly, the delay should not bar an Given that the Coalition has already filed
interlocutory appeal. its proposed remedies, the court will require
the State to respond, albeit with an extension
G. The Court Will Certify the Appeal of time. If the State refiles a motion to stay
after briefing on remedies is complete, the
The requirements of § 1292(b) are
court will revisit the issue, perhaps with the
satisfied here. The court will certify an
benefit of the Fourth Circuit's decision on
interlocutory appeal of the Ruling.
whether to accept certification of the
interlocutory appeal.
II. Other Motions
As to the State's motion for an extension
of time to respond to the Coalition's remedial
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Coal. For Equity & Excellence in Md. Higher Educ. v. Md. Higher Educ. Comm'n (D. Md., 2015)

proposal, the State asks that its response be at *2. The Fourth Circuit appeared to agree,
postponed "to no sooner than September 3, examining the issue and noting that "the
2015." (State's Mot. Extension 1, ECF No. requirements of § 1292(b) [were] clearly
409.) The Coalition's remedial proposal satisfied . . . ." Kennedy, 657 F.3d at 195.
presents complicated issues, and the State's
request is reasonable. Given that the court has --------
required time to consider the motions, the
State's response to the Coalition's remedial
proposal will be due by September 30, 2015.

CONCLUSION

For the reasons stated above, the court


will grant the motion for a certificate of
appealability, deny the motion to stay, and
grant the motion for an extension.

A separate order follows.

June 29, 2015


Date

/S/_________
Catherine C. Blake
United States District Judge

--------

Footnotes:

Unpublished cases are cited for the


1.

persuasiveness of their reasoning, not for any


precedential value.

2. A district court may amend a prior

decision to state that the conditions necessary


for an interlocutory appeal have been met. See
Fed. R. App. P. 5(a)(3).

Ayers v. Fordice, 111 F.3d 1183, 1217-21


3.

(5th Cir. 1997).

4. In Kennedy, 2010 WL 9009364, the


court certified an issue for interlocutory appeal
despite it being a question of first impression.
The court noted, however, that "when a matter
of first impression also had other grounds for
difference of opinion—and met the other two
criteria—, district courts in this circuit have
certified the issue for interlocutory appeal." Id.

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EXHIBIT H

Case 3:18-cv-00017-NKM-JCH Document 148-8 Filed 06/06/19 Page 1 of 12 Pageid#:


2342
Virginia ex rel. Integra REC LLC v. Countrywide Sec. Corp. (E.D. Va., 2015)

COMMONWEALTH OF VIRGINIA ex misrepresentations in offerings of mortgage-


rel. INTEGRA REC LLC, Plaintiff, backed securities ("MBS"), also called
v. certificates, or residential mortgage-backed
COUNTRYWIDE SECURITIES securities ("RMBS"), also called certificates
CORPORATION, et al., Defendants. (collectively, "certificates"). CSC and four of its
affiliates ("the Removing Defendants")
Civil Action No. 3:14cv706 removed the portion of the Richmond Circuit
Court action they say involves every MBS
UNITED STATES DISTRICT COURT certificate issued by Countrywide Financial
FOR THE EASTERN DISTRICT OF Corporation ("CFC") and its affiliates. On
VIRGINIA Richmond Division October 24, 2014, CSC filed a Motion to
Transfer this action to the United States
June 3, 2015 District Court

MEMORANDUM OPINION Page 3

This matter comes before the Court on the for the Central District of California. (ECF No.
Commonwealth of Virginia's Motion to Amend 15.) On October 31, 2014, the Commonwealth
and Certify Order for Interlocutory Review moved this Court to remand the action to the
Pursuant to 28 U.S.C. § 1292(b)1 (the "Motion Richmond Circuit Court. (ECF No. 42.)
to Amend and Certify") and Motion to Stay.
(ECF No. 99.) Countrywide Securities On March 17, 2015, following a stay
Corporation ("CSC") filed a response to the ordered by the Court (ECF Nos. 75-76), the
Motion, and the remaining four defendants in Court entered the March Opinion and Order.
this removed action joined CSC's opposition. (ECF Nos. 85-86.) The Court denied CSC's
(ECF Nos. 101, 103-06.) The Commonwealth Motion to Transfer this action to the Central
filed its reply. (ECF No. 107.) The matter is ripe District of California and the Commonwealth's
for disposition. The Court dispenses with oral Motion to Remand as to mandatory
argument because the materials before the abstention, permissive abstention, and
Court adequately present the facts and legal equitable remand. (March Mem. Op. 7-12.)
contentions, and argument would not aid the The Court also referred the parties to
decisional process. settlement proceedings with the Honorable
David J. Novak, United States Magistrate
Page 2 Judge. (March Mem. Op. 12-13.) The parties
scheduled a settlement conference to take
The Court exercises jurisdiction pursuant
place on June 9 and 10, 2015. (See Am. O.
to 28 U.S.C. § 1334(b)2 and 1367.3 For the Regarding Proced. Settlement Conf. ("Am.
reasons that follow, the Court will deny the
Settlement Conf. O.") 1, ECF No. 118.)
Commonwealth's Motion to Amend and
Certify and the Commonwealth's Motion to The Commonwealth's present motion
Stay. (ECF No. 99.) seeks interlocutory appeal only of the Court's
denial of mandatory abstention pursuant to 28
I. Procedural and Factual Background4
U.S.C § 1334(c)(2).5 (Commw. Mot. Amend 1,
ECF No. 99.) In its March Opinion, the Court
In its Complaint originally filed in the
noted that of the five factors required for
Richmond Circuit Court, the Commonwealth
mandatory abstention, the parties contested
of Virginia, on behalf of the Virginia
only the final factor: whether "an action is
Retirement System ("VRS"), alleges that
commenced and can be timely adjudicated in
defendants made fraudulent
state court." (March Mem. Op. 10.) The
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Virginia ex rel. Integra REC LLC v. Countrywide Sec. Corp. (E.D. Va., 2015)

language of the fifth factor involves two adjudication in the Richmond Circuit Court
considerations, meaning the failure to meet based on the general caseload and judicial
either the statistics before it, the Court could not find
that the evidence supported mandatory
Page 4 abstention.

"commencement" or "timely adjudication" Page 5


prong blocks a party's ability to satisfy the
mandatory abstention test. The rinding as to timely adjudication
rested primarily on the factual record before
While in the March Opinion this Court the Court notwithstanding the legal issue the
noted discussion among several courts Court had to address. In short, as to timely
regarding the application of both the adjudication, the Court discussed the various
"commencement" and the "timely evidentiary exhibits placed before it by both
adjudication" requirements, this Court the Commonwealth and CSC that purportedly
ultimately found that the Commonwealth addressed the Richmond Circuit Court's ability
failed to meet any test articulated as to timely to timely adjudicate the action. (Id. at 11-12).
adjudication, and denied the motion for Largely because neither party addressed the
mandatory abstention without making what progress of any proceeding in the Richmond
would have been an advisory analysis of the Circuit Court,6 the Court found the record
commencement prong of the mandatory "bereft" of adequate helpful evidence to allow
abstention test. For instance, in its discussion it to make a finding that the Richmond Circuit
of the judicial development of this factor's Court could timely adjudicate this matter. (Id.
analysis, the Court simply noted that the at 12; see also id. at 9 ("The record before the
United States Court of Appeals for the Fourth Court does not present a solid basis for
Circuit "has not spoken to the split of lower mandatory abstention.").)
court authority as to when an action must have
been 'commenced' under this test." (March The Commonwealth seeks certification of
Mem. Op. 10 (citing cases).) Because the Court two questions for interlocutory review related
made a finding as to timely adjudication, it did to 28 U.S.C. § 1334(c)(2) (the "First Question"
not further address the commencement prong and the "Second Question"):
of the test.
1. "[W]hether the provision stating 'if an
Instead, the Court observed that while the action is commenced . . . in a State forum of
Fourth Circuit "has not resolved a split of appropriate jurisdiction' imposes an
lower court authority as to which party bears additional requirement that the state court
the burden of demonstrating whether a case action must have been filed prior to the
can be timely adjudicated in state court, and related-to bankruptcy case." (Commw. Mot.
what evidence is needed to meet the burden[,]" Amend 1 (alteration in original).)
(id. (citing cases)), the Court had a record
before it in which none of the evidence Page 6
produced by either side "sufficiently
educate[d]" the Court regarding the timely 2. "[W]hich party bears the burden of
adjudication issue. (Id. at 11.) This finding demonstrating whether the 'action . . . can be
necessarily placed the burden on the timely adjudicated in a State forum of
Commonwealth as the party moving for appropriate jurisdiction,' and what evidence is
mandatory abstention, and found the evidence sufficient to satisfy the burden." (Commw.
wanting. Because the Court could not make a Mot. Amend 1 (alteration in original).)
finding that the evidence supported a timely
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2344
Virginia ex rel. Integra REC LLC v. Countrywide Sec. Corp. (E.D. Va., 2015)

II. Applicable Law: Interlocutory Bayer Corp., No. 3:10cv261-JRS, 2010 WL


Review Pursuant to 28 U.S.C. § 1292(b) 4789838, at *2 (E.D. Va. Nov. 16, 2010).
Interlocutory appeals are an "extraordinary
The Commonwealth seeks an immediate remedy," Fannin v. CSX Transp., Inc., No. 88-
appeal from the March Order. At the same 8120, 1989 WL 42583, at *2 (4th Cir. Apr. 26,
time, the Commonwealth seeks a stay in this 1989) (unpublished) (per curiam), that sit
action - to commence after the "already contrary to "the well-established policy
referred . . . settlement conference" in the limiting appeals to final judgments." Long v.
district court.7 (Mot. Amend at 1-2.) CPI Sec. Sys., Inc., No. 3:12cv396-RJC-DSC,
2013 WL3761078, at *1 (W.D.N.C. July 16,
A. General Standards Underlying 2013) (citation omitted) (internal quotation
Interlocutory Appeal marks omitted); see Difelice v. U.S. Airways,
Inc., 404 F. Supp. 2d 907, 908 (E.D. Va. 2005).
As to the requirements for an appeal, Further, courts are "bound 'to protect the
"[f]ederal appellate jurisdiction generally integrity of the congressional policy against
depends on the existence of a decision by the piecemeal appeals.'" Fannin, 1989 WL 42583,
[d]istrict [c]ourt that 'ends the litigation on the at *2 (quoting Switz. Cheese Ass'n v. Home's
merits and leaves nothing for the court to do Mkt., Inc., 385 U.S. 23, 25 (1966)); see Xoom,
but execute the judgment.'" Coopers & Inc. v. Imageline, Inc., No. 3:98cv00542-JRS,
Lybrand v. Livesay, 1999 WL 1611444, at *1 (E.D. Va. Sept. 3, 1999)
(citing James v. Jacobson, 6 F.3d 233, 237
Page 7
(4th Cir. 1993)); Riley v. Dow

437 U.S. 463, 467 (1978) (citing Catlin v.


Page 8
United States, 324 U.S. 229, 233 (1945)).
However, Congress has established narrow Corning Corp., 876 F. Supp. 728, 731
avenues by which litigants may pursue appeals (M.D.N.C. 1992). Section 1292(b) is not
of non-final orders. See Katz v. Carte Blanche intended to allow interlocutory appeals in
Corp., 496 F.2d 747, 753-54 (3d Cir. 1974) ordinary suits, Xoom, 1999 WL 1611444, at *1,
(discussing the legislative history of but instead should be utilized for "'orders
interlocutory appeals). Section 1292(b) deemed pivotal and debatable.'" Difelice, 404
provides litigants one such path to an F. Supp. 2d at 908 (quoting Swint v.
interlocutory appeal "upon the consent of both Chambers Cnty. Comm'n, 514 U.S. 35, 46
the district court and the court of appeals." In (1995)). Thus, certification is "not to be
re Cement Antitrust Litig., 673 F.2d 1020, granted lightly." Fannin, 1989 WL 42583, at
1025-26 (9th Cir. 1982). Pursuant to Section *2.
1292(b), a district court may certify a non-final
order for interlocutory appeal when the court Section 1292(b) ensures such an
finds that the order sought for appeal involves extraordinary remedy will not be granted
(1) a controlling question of law (2) about lightly by requiring "dual judicial discretion"
which there is substantial ground for in the certification and acceptance of the
difference of opinion and (3) an immediate appeal. Cross v. Suffolk City Sch Bd, No.
appeal therefrom may materially advance the 2:11cv88-RBS, 2011 WL 2838180, at *2 (E.D.
termination of the litigation.8 28 U.S.C. § Va. July 14, 2011) (citing Myles v. Laffitte, 881
1292(b). F.2d 125, 126 n.2 (4th Cir. 1989)). First, the
movant must demonstrate to the district court
The Court must begin a Section 1292(b) that he or she meets all three Section 1292(b)
analysis "by emphasizing the gravity of the factors. See Cooke-Bates, 2010 WL 4789838,
relief sought in such a request. Cooke-Bates v. at *2. "Even if the requirements of [S]ection
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2345
Virginia ex rel. Integra REC LLC v. Countrywide Sec. Corp. (E.D. Va., 2015)

1292(b) are satisfied, the district court has question were decided." Wyeth v. Sandoz,
'unfettered discretion' to decline to certify an Inc., 703 F. Supp. 2d 508, 525 (E.D.N.C. 2010)
interlocutory appeal if exceptional (quoting Howes, 889 F. Supp. at 852-53).
circumstances are absent." Manion v. When the resolution of a question would not
Spectrum Healthcare Res., 966 F. Supp. 2d completely end the litigation altogether,
561, 567 (E.D.N.C. 2013) (citation omitted); district courts look to whether the immediate
see Coopers & Lybrand, 437 U.S. at 474 ("A appeal would be "serious to the conduct of the
party seeking review of a nonfinal order must litigation, either practically or legally." Katz,
first obtain the consent of the trial judge."); 496 F.2d at 755-56.
State of N.C. ex rel. Howes v. W.R. Peele, Sr.
Trust, 889 F. Supp. 849, 852 (E.D.N.C. 1995) Questions sought to be certified should be
(noting that Section 1292(b) provides "great "narrow question[s] of pure law." Fannin,
flexibility" to the district court). After 1989 WL 42583, at *5. Even if a question "is
certification in the district court, the court of technically one of law," if the issue is "heavily
appeals makes a separate determination as to freighted with the necessity for factual
the appropriateness of an interlocutory assessment," the question is likely not proper
appeal.9 for

Page 9 Page 10

B. The Three Elements of Section Section 1292(b) interlocutory review. Id.; see
1292(b) Xoom, 1999 WL 1611444, at *2 (finding an
issue not a "controlling question of law"
1. A District Court Must Find It because "it was in part based on facts" placed
Ruled on a Controlling Question of Law into evidence by the parties); In re Jemsek
Clinic, P.A., Nos. 06-31766, 06-319866, 07-
The standards by which a district court 03006, 07-03008, 2011 WL 3841608, at *3
must evaluate the three parts of Section (W.D.N.C. Aug. 30, 2011) (denying
1292(b) are clear. The party seeking an certification of a question that was "'grounded
interlocutory appeal must first demonstrate in the specific facts of the case, and cannot be
that the question sought for certification is a divorced from [those] facts'" (alteration in
"controlling question of law." 28 U.S.C. § original) (citation omitted)) (applying Section
1292(b). This element may be divided into two 1292(b) analysis to an interlocutory
requirements: the question must be bankruptcy appeal). Pure questions of law
"controlling" and it must be one "of law." In include "matters the court of appeals can
order for a question to be "controlling," the decide quickly and cleanly without having to
district court must actually have decided such study the record." Long, 2013 WL 3761078, at
question. Paschall v. Kansas City Star Co., *2 (citation omitted) (internal quotation
605 F.2d 403, 409 (8th Cir. 1979); see marks omitted).
Schwartz v. Rent a Wreck of Am., Inc., ___ F.
App'x ___, No. 13-2189, 2015 WL 1020647, at 2. A District Court Must Find A
*3 n.2 (4th Cir. Mar. 10, 2015) (unpublished). Substantial Ground for Difference of
Controlling questions include those "whose Opinion
resolution will be completely dispositive of the
litigation, either as a legal or practical matter, Next, the party pursuing a Section 1292(b)
whichever way it goes." Fannin, 1989 WL interlocutory appeal must show that a
42583, at *5. "Conversely, a question of law "substantial ground for difference of opinion"
would not be controlling 'if the litigation would exists as to the controlling questions of law. 28
necessarily continue regardless of how that U.S.C. § 1292(b). Such ground "must arise 'out
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of a genuine doubt as to whether the district of the litigation" as required by Section


court applied the correct legal standard in its 1292(b).
order.'" Wyeth, 703 F. Supp. 2d at 527 (citation
omitted). "[J]ust any simple disagreement III. Analysis
between courts will not merit certification."
Cooke-Bates, 2010 WL 4789838, at *2. A mere For the following reasons, the March
lack of unanimity, Wyeth, 703 F. Supp.2d at Opinion and Order do not involve "a
527, or opposing decisions outside of the controlling question of law," nor would an
governing circuit, need not persuade a court immediate appeal from that decision
that a substantial ground for disagreement "materially advance the ultimate termination
exists. Cross, 2011 WL 2838180, at *3 n.1. "An of the litigation."10 28 U.S.C. § 1292(b). The
issue presents a substantial ground for First Question does not involve a controlling
difference of opinion if courts, as opposed to question of law, and any appeal could seek
parties, disagree on a controlling question of only an advisory opinion. The Second
law." Cooke-Bates, 2010 WL 4789838, at *2 Question does not involve a controlling
(citation omitted). question of law because it turns upon an

Page 11 Page 12

3. A District Court Must Find an examination of the factual record in this case.
Interim Appeal Would Materially Further, immediate appeal of the questions
Advance the Ultimate Termination of would not materially advance the termination
the Litigation of the litigation, and therefore certification
would not be proper. Accordingly, the Court
Finally, the party seeking interlocutory will deny the Commonwealth's Motion to
appeal must establish that certification would Amend and Certify.
"materially advance the ultimate termination
of the litigation." 28 U.S.C. § 1292(b). "The A. The First Question Is Not a
mere fact that [the resolution of the question Controlling Issue of Law and an
sought to be certified] at this time may save Immediate Appeal Could Seek Only an
pre-trial and trial effort and expense is not Advisory Opinion
determinative . . . ." Fannin, 1989 WL 42583,
at *5 (citation omitted). Such speculation "of Because the Court denied mandatory
course can be said of any interlocutory abstention based on "timely adjudication" and
appeal." Id. Instead, courts look to whether not "commencement," the First Question does
"'early appellate review might avoid protracted not constitute a controlling question of law.
and expensive litigation.'" Xoom, 1999 WL The Court did not make a ruling as to when an
1611444, at *1 (quoting Howes, 889 F. Supp. at action need be commenced in a State forum,
852); see In re Va. Elec. & Power Co., 539 F.2d meaning an immediate appeal to the Fourth
357, 364 (4th Cir. 1976) (finding interlocutory Circuit could seek only an advisory opinion.
appeal would advance the ultimate The First Question "necessarily misstates the
termination of the litigation because the Court's ruling in this case." Xoom, 1999 WL
decision would prevent needless waste of 1611444, at *1. While the Court discussed
"much time, expense and effort"). Accordingly, courts' differing approaches regarding the
courts use a case-specific analysis to "commencement" of an action in a state forum,
determine whether the time and expense the March Opinion and Order clearly made no
saved on interlocutory appeal would ruling on the interpretation of this phrase. (See
"materially advance the ultimate termination March Mem. Op. 10.) A plain reading of the
March Opinion shows that the Court based its
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ruling on the lack of useful evidence presented be timely adjudicated in state court."11 Id. at
to it by the parties with respect to the timely 297.
adjudication prong only. (See March Mem. Op.
9, 11-12.) The Court cannot certify for Second, to the extent the March Opinion
interlocutory appeal a question not ruled would need the clarification only one party
upon. See Paschall, 605 F.2d at 409. Any seeks here, the Court may, "on its own, with or
Fourth Circuit ruling on an issue not without notice[,]" correct what could be
addressed by this trial court would be
advisory. See Schwartz, 2015 WL 1020647, at Page 14
*3 n.2. Accordingly, the First Question does
not involve a controlling question of law characterized as "a mistake arising from
required by Section 1292(b). Thus, the oversight or omission." Fed. R. Civ. P. 60(a).12
Commonwealth fails to satisfy the first See Sartin v. McNair Law Firm PA, 756 F.3d
element required for an interlocutory appeal, 259, 265-66 (4th Cir. 2014). As noted above,
and the Court will deny the Commonwealth's the Court implicitly placed, and still intends to
Motion to Amend as to the First Question. place, the burden of proof on the
Commonwealth, the moving party, regarding
Page 13 timely adjudication. To the extent the March
Opinion might "include[ ] an unintended
B. The Second Question Is ambiguity that obfuscates the court's original
Inappropriate for Interlocutory Appeal intent," Sartin, 756 F.3d at 266, and
"consistent with the intent of the original
1. The March Opinion Placed the [opinion]," id., the Court now clarifies that the
Burden of Proof on the Commonwealth March Opinion placed the burden of proof
regarding timely adjudication on the
The Commonwealth's briefing suggests Commonwealth.13
that the March Opinion did not sufficiently
articulate the Court's intent to hold the Third, the "correct inquiry [as to timely
Commonwealth, as the moving party, to a adjudication] is whether the claim will be
burden of proof regarding timely adjudication timely adjudicated in state court." Massey
of this matter in state court. CSC correctly Energy Co. v. W. Va. Consumers for Justice,
identifies that the Court implicitly placed the 351 B.R. 348, 352 (E.D. Va. 2006). Thus, the
burden of proof as to timely adjudication on Court's ultimate conclusion, that it had
the Commonwealth. (CSC Mem. Opp'n Mot. conflicting general information and no specific
Amend 9 n.2.) However, to the extent a lack of evidence as to this issue, is consistent with case
clarity exists, it requires no different outcome. law. At least two other courts have addressed
timely adjudication without an analysis of the
First, as CSC identifies, the March burden and decided to remand based on the
Opinion impliedly ruled that the very evidence the Court found lacking in this
Commonwealth, as the party moving for case. See, e.g., Bender v. Insight Health Corp.,
abstention, held the burden of proof. Indeed, Nos. 7:13cv00157, -158, -159, 2013 WL
as noted by the court in Power Plant Entm't 1952150, at *1 n.1 (W.D. Va.
Casino Resort Ind., LLC v. Mangano, 484 B.R.
290, 297-99 (Bankr. D. Md. 2012), when the Page 15
parties present no evidence—or, as in this
instance, no helpful evidence—regarding May 10, 2013) (finding the timely adjudication
timely adjudication in state court, the element met when the parties had submitted
resolution of this element "hinges on which affidavits and other filings to show that the
party has the burden to show that a matter can state case was moving swiftly, with partial
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summary judgment already issued and a plan Page 16


to address factual and legal issues moving
forward); Massey Energy Co., 351 B.R. at 352 Court held that the evidence presented by both
(finding the timely adjudication element met parties was unhelpful in its analysis. The Court
when the parties showed that discovery had found that, while it would not undergo an
commenced, motions had been heard, a final analysis of the relative state and federal court
trial date had been set, and further dockets, the fact that the parties omitted any
continuances would be denied by the state mention of the specific status of the related
court). litigation at the state court level prevented the
Court from evaluating an important aspect of
Finally, as the Court discusses in Section the timely adjudication analysis. (March Mem.
III.B.2, infra, independent of the implicit Op. 12.) The Court ruled that the only evidence
finding as to burden made by this Court, the before it was contradictory: it could not make
Second Question is too heavily freighted with a timely adjudication finding based on a court
factual assessment to be appropriate for being "generally busy," based on dated articles
interlocutory appeal. about judicial vacancies, or based on statistics
that showed both swift decisions and cases
2. The Second Question Is Not a that languished for years. (March Mem. Op.
Controlling Question of Law Because It 11-12).
is Too Heavily Freighted with Factual
Assessment That said, any determination by another
court on appeal would necessarily involve
Regardless of any ambiguity regarding the reviewing the law and weighing the facts.
party that carries the burden, the Second Thus, unlike questions of pure law, these
Question as to which party bore the burden of factual questions cannot be "decide[d] quickly
demonstrating timely adjudication is not a and cleanly without having to study the
controlling question of law because its analysis record." Long, 2013 WL 3761078, at *2
would necessarily require a factual assessment (citation omitted). Because the Second
beyond that which is appropriate on an Question grounds itself in the "specific facts"
interlocutory appeal under Section 1292(b). presented by the parties, its resolution proves
The Court ruled that no party presented inappropriate for interlocutory appeal. In re
sufficiently helpful evidence to allow this Court Jemsek Clinic, 2011 WL 3841608, at*3.
to find that the Richmond Circuit Court could Accordingly, the Second Question does not
timely adjudicate this action. (See March pose a controlling question of law as required
Mem. Op. 11-12.) When it ruled, the Court had by Section 1292(b). Thus, the Commonwealth
conflicting general evidence, but no specific fails to satisfy the first element required for an
insight, as to how efficiently the state court interlocutory appeal, and the Court will deny
action could proceed, or was proceeding. The the Commonwealth's Motion to Amend as to
Court considered various exhibits submitted the Second Question.
by both the Commonwealth and CSC. (Id.) As
such, the Court's ruling necessarily took into C. An Immediate Appeal from the
account questions of fact not appropriate on Opinion and Order Would Not
an interlocutory appeal. See Fannin, 1989 WL Materially Advance the Ultimate
42583, at *5. Termination of this Litigation

The Court feels it necessary to point out a The Court also finds that an immediate
distinction in its ruling. The Court did not hold appeal from the March Opinion would not
that the parties presented no evidence at all on materially advance the ultimate termination of
the issue of timely adjudication. Rather, the the litigation in this case. An immediate
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appeal, even were it to be granted, would only further delay such briefing.16 See Difelice, 404
delay the trial process further, especially in F. Supp. 2d at 910. In addition, the stay sought
light of the stay requested by the by the Commonwealth "while it pursues
Commonwealth. Even were an immediate appeal [would] only exacerbate[ ] the delay
appeal certified by this Court, heard by the inherent in interlocutory appeal on these
Fourth Circuit, and ruled upon in the facts." Long, 2013 WL 3761078, at *4. Finally,
Commonwealth's favor, such ruling would not even if all went in the Commonwealth's favor—
that is, this Court certified the March Opinion
Page 17 and Order; the Fourth Circuit accepted the
interlocutory appeal; and, the Fourth Circuit
advance an ultimate termination of the reversed this Court as to its finding on timely
litigation. Presumably, the case would first adjudication—the appeal would, likely, at best
return to this Court under remand to result in a remand of this action to this Court
implement a finding as to timely adjudication. to implement a timely adjudication finding
Next, this Court likely would have to make a and then determine "commencement" on the
finding on the First Question regarding facts of this case. If the Commonwealth again
"commencement" as it applied to the record in prevailed, a remand to the Richmond Circuit
this case. Only then could the case advance. Court would take place, where the action will
And that progress would amount to continued be no more advanced on the merits than it now
litigation in this federal court, or in state court stands.
upon remand from this Court. The case would
not terminate. Here, certification cannot "materially
advance the ultimate termination of the
This action has been pending in this Court litigation," 28 U.S.C. § 1292(b), because it
for over six months, and its progression has "would only serve to further delay the trial
been characterized by multiple procedural process." Riley, 876 F. Supp. at 731. Thus, the
motions. The Court has yet to see a motion or Commonwealth also fails to meet the third
pleading, with the exception of the Complaint, prong required to establish a basis for
regarding the merits of the Commonwealth's interlocutory appeal, and the Court will deny
claims. In the event that the scheduled the Commonwealth's Motion to Amend as to
settlement proceedings do not prove both the First and Second Questions.
successful, the Court has ordered a status
conference to order expeditious briefing on a Page 19
potentially dispositive summary judgment
motion: the preclusive effect of the Luther IV. The Motion to Stay Is Moot
federal class action,14 which presents "an
important question of federal law."15 (March Because the Court denies this motion, the
Mem. Op. 7-8 (noting that a review of the proceedings will continue as presently
Luther documents suggests "that 17 of the 22 scheduled, and the Commonwealth's Motion
certificates in this action are included in the to Stay is rendered moot. The Court will deny
settlement.").) (See March Mem. Op. 12-13; the Motion to Stay as moot.
April 28, 2015 docket entry (setting June 15,
2015 conference call to establish briefing on V. Conclusion
the Luther class issue).)
For the reasons stated above, the Court
Page 18 denies the Commonwealth's Motion to Amend
and Certify Order for Interlocutory Review
Certification of the March Opinion and and the Commonwealth's Motion to Stay.
Order for interlocutory appeal would only (ECF No. 99.)
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An appropriate Order shall issue. jurisdiction that they form part of the same
case or controversy . . . .").
/s/_________
M. Hannah Lauck 4.The Court assumes familiarity with the
United States District Judge procedural and factual background of this case
as summarized in its January 14, 2015
Richmond, Virginia Memorandum Opinion and Order and its
Date: 6/3/15 March Opinion and Order. (ECF Nos. 75-76,
85-86.) Those opinions and orders more fully
describe the procedural and factual
-------- background of this case, and the Court repeats
the background only to the extent necessary to
Footnotes: inform for the present motion. All terms
defined in those opinions and orders will
1.Section 1292(b) describes a process
continue unless otherwise noted.
under which a district court and the court of
appeals may permit an interim appeal from a 5. That statute states, in pertinent part:
"not otherwise appealable" order. 28 U.S.C. §
1292(b). The Court evaluates the application of (2) Upon timely motion of a
this statute in detail in Sections II and III, party in a proceeding based
infra. upon a State law claim or State
law cause of action, related to a
2.That statute states, in pertinent part: case under title 11 but not arising
"[T]he district courts shall have original but under title 11 or arising in a case
not exclusive jurisdiction of all civil under title 11, with respect to
proceedings arising under title 11, or arising in which an action could not have
or related to cases under title 11." 28 U.S.C. § been commenced in a court of
1334(b). A court has "related to" jurisdiction the United States absent
over all claims giving rise to contractual claims jurisdiction under this section,
against entities in pending bankruptcy the district court shall abstain
proceedings. See In re Celotex, 124 F.3d 619, from hearing such proceeding if
625 (4th Cir. 1997). In the Court's March 17, an action is commenced, and can
2015 Memorandum Opinion and Order (the be timely adjudicated, in a State
"March Opinion" or collectively, the "March forum of appropriate
Opinion and Order"), the Court concluded that jurisdiction.
it has such "related to" jurisdiction in this
action. (See March 17, 2015 Memorandum 28 U.S.C. § 1334(c)(2).
Opinion ("March Mem. Op.") 4-5, ECF No.
85.)
6. Oddly enough, the Court now has some
evidence that the Richmond Circuit Court may
3. The Court exercises supplemental be entertaining a dispositive motion regarding
jurisdiction over any claims that do not give the preclusive effect of a federal class action
rise to contractual obligations upon entities in settlement on the unremoved portion of the
bankruptcy, pursuant to 28 U.S.C. § 1367(a) Commonwealth's original action. (See CSC
("[I]n any civil action of which the district Mem. Opp'n Mot. Amend 15 n.9, ECF No. 101;
courts have original jurisdiction, the district see generally Decl. Brian E. Pumphrey, ECF
courts shall have supplemental jurisdiction No. 102 (including an excerpt from a
over all other claims that are so related to memorandum in support of such a motion).)
claims in the action within such original The Court finds this peculiar for three reasons.
First, such motion appears to have been filed
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on January 20, 2015, the same date the parties proceedings following the settlement
filed supplemental briefs in this Court on the conference on June 9 and 10 and before
motions to transfer, remand, and stay, yet no briefing would begin. (See Mot. Amend 1-2.)
party presented this information to the Court
at that time. Second, while CSC has now The Court expresses dismay at the
presented a portion of that motion to the Commonwealth's procedural wrangling when
Court, it provided the Court with no the March Opinion plainly cites a federal class
information regarding its present status in the action settlement - identified by CSC at the
Richmond Circuit Court. Finally, and perhaps onset of litigation - that may govern the case
most curious, the Commonwealth has never and could require dismissal. If the Court's
addressed the existence of the motion and observations are incorrect, the best use of
failed to discuss its presence even in its reply litigative resources would be to address the
to CSC's response in opposition to the Motion issue posed by the Court directly, rather than
to Amend and Certify. Although the parties to seek a procedural workaround so that a
were not required to provide this Court with different court rules on the issue. The Court
evidence on the Motion to Amend and Certify, has ordered multiple delays with the
the parties have yet again provided the Court Commonwealth's consent, and the
with just a trace of useful evidence regarding Commonwealth now seeks an additional
the ability of the Richmond Circuit Court to indeterminate stay while claiming, in essence,
timely adjudicate this action. that it does so to save resources. This
inconsistent position strains logic.
7. The Commonwealth continues to insist
that remand to the Richmond Circuit Court,
8. If the district court does not certify its
after appeal, is necessary to effectuate judicial order contemporaneously, the court may
economy. Yet many of the Commonwealth's amend the order later to include the
actions belie their arguments for efficiency. certification. Fed. R. App. P. 5(a)(3).
During briefing on the previously ruled upon 9. The Fourth Circuit has stated that courts
motions to remand, stay, and transfer, the
should use Section 1292(b) "sparingly," Myles,
parties filed two joint motions to extend the
881 F.2d at 127, and only "'in exceptional
time allotted to file responses and replies to
situations in which [doing so] would avoid
the pending substantive motions. (ECF Nos. 7,
protracted and expensive litigation.'" Fannin,
53.) In the interest of judicial economy and
1989 WL 42583, at *2 (alteration in original)
recognizing the complexity of the case, the
(quoting In re Cement Antitrust Litig., 673
Court granted such extensions, allowing the
F.2d at 1026). Accordingly, "given the basic
parties substantially more time than the
policy of postponing appellate review until
Federal Rules of Civil Procedure would
after the court has entered final judgment in
normally allow. (ECF Nos. 27, 54.)
the case, [Section] 1292(b) clearly places on
During a telephone conference on April the movant the burden of persuading the court
28, 2015, again through the agreement of the that 'exceptional circumstances' justify a
parties, the Court functionally halted the departure from that policy." LeFleur v. Dollar
normal briefing process to allow the parties to Tree Stores, Inc., No. 2-12cv00363, 2014 WL
focus on settlement. The Court allowed 2121721, at *1 (E.D. Va. May 20, 2014)
briefing on the preclusive effect of a federal (quoting Howes, 889 F. Supp. at 853). Thus,
class action to commence only if settlement even if the district court certifies an order for
did not succeed. A briefing schedule would be interlocutory appeal, the movant must still
set during a conference call on June 15, 2015 demonstrate the existence of "exceptional
should settlement fail. Now, in its Motion to circumstances" to the court of appeals.
Amend, the Commonwealth seeks a stay of the Fannin, 1989 WL 42583, at *2.

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10. CSC also argues that no "substantial 13.The Court notes that it was most
ground for difference of opinion" exists as to persuaded by the traditional notion that the
the questions sought for certification. The moving party carries the burden of proof. See
Court finds that neither of the questions In re Freeway Foods of Greensboro, Inc., 449
involves "controlling questions of law" and B.R. 860, 878 (Bankr. M.D.N.C. 2011). (See
that immediate appeal would not "materially March Mem. Op. 10.) The Court has
advance the ultimate termination of the established jurisdiction over this case (see
litigation." While the Court finds persuasive March Mem. Op. 4-5), and the Court holds a
CSC's arguments as to a "substantial ground responsibility to exercise its jurisdiction unless
for difference of opinion," it need not address some rule demands otherwise. In light of the
whether such difference of opinion exists. See Commonwealth's failure to satisfy its burden
Cooke-Bates, 2010 WL 4789838, at *2 n.4 of proof, no rule demands that the Court
(declining to address two of Section 1292(b)'s decline to exercise jurisdiction in this matter.
requirements after finding one element
unsatisfied). Should the parties desire a separate order
clarifying the March Opinion, they may
11.The Power Plant court highlighted the petition the Court with such a request.
importance of the burden when no evidence
existed regarding the state court's ability to
14.Luther v. Countrywide Fin. Corp., No.
timely adjudicate the case. 484 B.R. at 297-99. 2:12-cv-05125-MRP (MANx) 1, ECF No. 320
If the party seeking abstention—here the (CD. Cal. Dec. 5, 2013) (final order approving
Commonwealth—holds the burden but class settlement).
presents no helpful evidence, the court would
The Supreme Court of the United States
15.
necessarily deny the motion and retain the
directs that "[t]he preclusive effect of a federal-
action in federal court. See id. Conversely, if
court judgment is determined by federal
CSC, when opposing abstention, held the
common law." Taylor v. Sturgell, 553 U.S.
burden but provided no helpful evidence, the
880, 890 (2008). (See March Mem Op. 7.)
Court would have abstained from the case. See
id. The first example proved true in this Court. 16.Indeed, it seems that the arguments
In the March Opinion, the Court found that a made by the Commonwealth regarding the
lack of helpful evidence existed on the record judicial economy of an immediate appeal—the
and denied the motion to abstain. Thus, the efficiency of consolidating the removed action
Court impliedly held that the Commonwealth with the original action—only reiterate its
bore the burden of proof. position taken on permissive abstention and
equitable remand. (Compare Commw. Mem.
12. That rule states, in pertinent part:
Supp. Mot. Amend 7, ECF No. 100, with
(a) Corrections Based on Commw. Supp'l Br. Supp. Mot. Remand 2-3,
Clerical Mistakes; ECF No. 83.) The Court has already rejected
Oversights and Omissions. these arguments and found judicial economy
The court may correct a clerical best served by retaining the action in this
mistake or a mistake arising Court to determine the preclusive effect of a
from oversight or omission potentially related class action settlement.
whenever one is found in a (March Mem. Op. 9.)
judgment, order, or other part of
the record. The court may do so
--------
on motion or on its own, with or
without notice . . . .

Fed. R. Civ. P. 60(a).


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EXHIBIT I

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Bussing v. Cor Clearing, LLC (D. Neb., 2014)

JULIE A. BUSSING, Plaintiff, 2008). Interlocutory appeals are to be used in


v. extraordinary cases where they might avoid
COR CLEARING, LLC, et al., protracted and expensive litigation; not
Defendants. merely to provide review of difficult rulings in
hard cases. And they should be granted
8:12-CV-238 sparingly and with discrimination. Union
Cnty., 525 F.3d at 646. The party seeking an
UNITED STATES DISTRICT COURT appeal bears the heavy burden of
FOR THE DISTRICT OF NEBRASKA demonstrating that the case is an exceptional
one in which an immediate appeal is
Dated: July 17, 2014 warranted. Id. Here, the Court finds that
defendants have met their burden.
MEMORANDUM AND ORDER
The Court begins with the first and third
This matter is before the Court on the
criteria, which present related inquiries. The
defendants' motion to certify a question for an
matter to be certified is plainly a question of
interlocutory appeal and for a stay pending
law, as it is a
appeal. Filing 94. In its Memorandum and
Order of May 21, 2014 (filing 93), the Court Page 2
found that the plaintiff, Julie Bussing, had
stated a claim for relief under 15 U.S.C. § 78u- question of pure statutory interpretation. It is
6(h), a whistleblower-protection provision of also a controlling question of law. A question
the Dodd-Frank Wall Street Reform and is controlling "if its resolution is quite likely to
Consumer Protection Act of 2010 ("Dodd- affect the further course of the litigation, even
Frank"). More specifically, the Court found if not certain to do so." Sokaogon Gaming
that, for purposes of that anti-retaliation Enterprise Corp. v. Tushie-Montgomery
provision, the term "whistleblower" should be Associates, Inc., 86 F.3d 656, 659 (7th Cir.
read in the ordinary sense of the word, or as 1996). Stated another way, "controlling"
defined in 15 U.S.C. § 78u-6(a)(6). The means "serious to the conduct of the litigation,
defendants ask the Court to certify this issue either practically or legally." Katz v. Carte
for an interlocutory appeal pursuant to 28 Blanche Corp., 496 F.2d 747, 755 (3d Cir.
U.S.C. § 1292(b). For the reasons discussed 1974). And there is substantial overlap
below, the defendants' motion will be granted between the first and third criteria: "'a
in part and denied in part—the Court will question is controlling, even though its
certify the question presented for interlocutory decision might not lead to reversal on appeal,
appeal; but the Court will not stay if interlocutory reversal might save time for
proceedings. the district court, and time and expense for the
litigants.'" Johnson v. Burken, 930 F.2d 1202,
I. Certification of Interlocutory Appeal 1206 (7th Cir. 1991) (quoting 16 Charles Alan
Wright et al., Federal Practice and Procedure
Section 1292(b) establishes three criteria
§ 3930 (West 2014)).
for certification: the district court must be of
the opinion that (1) the order involves a If the Court of Appeals reverses this
controlling question of law; (2) there is Court's interpretation of the statute, then
substantial ground for a difference of opinion; Bussing's Dodd-Frank claim fails. This case
and (3) certification may materially advance would nonetheless continue, as Bussing has
the ultimate termination of the litigation. 28 asserted other claims for relief arising under
U.S.C. § 1292(b); Union Cnty., Iowa v. Piper state law. Even so, an appellate ruling on this
Jaffray & Co., Inc., 525 F.3d 643, 646 (8th Cir. disputed issue will have significant practical
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Bussing v. Cor Clearing, LLC (D. Neb., 2014)

and legal effects on other aspects of this case, Page 3


such that it should be deemed controlling.
amount of back pay. 15 U.S.C. § 78u-
First, as of now, this Court's subject 6(h)(1)(C). This uncertainty, in turn, tends to
matter jurisdiction is premised on Bussing's inhibit any potential for settlement. See Ungar
Dodd-Frank claim, which is her sole claim v. Dunkin' Donuts of America, Inc., 531 F.2d
arising under federal law. The Magistrate 1211, 1214 (3d Cir. 1976).
Judge previously found, as a preliminary
matter, that diversity jurisdiction had also The implications for an appellate ruling in
been established. See filing 70 at 17-18. But this case—whether an affirmance or reversal—
this was a preliminary determination, made on demonstrate that this issue is a controlling
the pleadings, which this Court has not question of law. For the same reasons,
evaluated, and which the defendants have resolution of this issue may materially advance
vowed to challenge. If the Court of Appeals this litigation. It will clarify the scope and
affirms this Court's ruling, this potential necessity of inquiring into the related legal
jurisdictional issue will remain dormant questions identified above and will put all
(along with the related question of whether to parties on firmer footing when it comes to
exercise supplemental jurisdiction under 28 conducting discovery, preparing for trial, and
U.S.C. § 1367). If the Court of Appeals reverses, forming their overall litigation strategy.
then these jurisdictional issues will need to be
examined. The Court also finds the second criterion
satisfied. To determine if a substantial ground
Second, Bussing's state-law claim for for difference of opinion exists under §
wrongful termination in violation of public 1292(b), courts must examine to what extent
policy is intimately connected to her Dodd- the controlling law is unclear. Couch v.
Frank claim. The Court previously found it Telescope Inc., 611 F.3d 629, 633 (9th Cir.
unnecessary to explore the precise boundaries 2010). The law may be unclear where the
of Nebraska public policy regarding retaliation circuits are in dispute on the question and the
against whistleblowers. Instead, the Court court of appeals of the circuit has not spoken
found that because Bussing is pointing to on the point. Id. That accurately describes the
Dodd-Frank as the source of public policy for present situation. The issue at hand has not
her state-law claim, then for all practical been addressed by the Eighth Circuit, and it
purposes, her wrongful discharge and Dodd- has prompted conflicting rulings from federal
Frank claims are perfectly co-extensive. Filing courts across the country. Compare, e.g.,
93 at 18. Again, if the Court of Appeals affirms, Ellington v. Giacoumakis, 977 F. Supp. 2d 42
these issues remain dormant; if it reverses, the (D. Mass. Oct. 16, 2013); Murray v. UBS Sec.,
contours of Bussing's state-law wrongful LLC, 2013 WL 2190084 (S.D.N.Y. May 21,
discharge claim will need to be explored. 2013); Genberg v. Porter, 935 F. Supp. 2d
Significant time may be saved by addressing 1094 (D. Colo. Mar. 25, 2013); Kramer v.
this and any potential jurisdictional issues Trans-Lux Corp., 2012 WL 4444820 (D.
now, rather than following a trial. Conn. Sep. 25, 2012); Nollner v. S. Baptist
Convention, Inc., 852 F. Supp. 2d 986 (M.D.
Third, appellate review will help clarify Tenn. Apr. 3, 2012) with Asadi v. G.E. Energy
the damages potentially available to Bussing. (USA), L.L.C., 720 F.3d 620 (5th Cir. 2013);
Depending upon the viability of Bussing's Englehart v. Career Educ. Corp., 2014 WL
Dodd-Frank claim, these could vary greatly, as 2619501 (M.D. Fla. May 12, 2014); Banko v.
that statute provides for attorney fees and Apple Inc., 2013 WL 7394596 (N.D. Cal. Sept.
double the 27, 2013); Wagner v. Bank of Am. Corp., 2013
WL 3786643 (D. Colo. July 19, 2013). Thus,
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Bussing v. Cor Clearing, LLC (D. Neb., 2014)

the Court finds that the criteria for an stay, in terms of additional delay in these
interlocutory appeal are satisfied, and will already lengthy proceedings, than defendants
certify this question of law to the Court of stand to gain. If the parties are able to make
Appeals for the Eighth Circuit. progress, even while the appeal is pending, it
can only serve to expedite resolution of this
II. Stay of Proceedings Before This case. Certain matters, such as Bussing's breach
Court of contract claims, will need to proceed
regardless of the outcome on appeal.
The defendants have also asked the Court
to stay proceedings during the pendency of IT IS ORDERED:
their appeal. A district court has the "inherent
power to control the disposition of the causes 1. The defendants' motion to
on its docket in a manner which will promote certify a question for an
economy of time and effort for itself, for interlocutory appeal and for a
counsel, and for litigants. The exertion of this stay pending appeal (filing 94) is
power calls for the exercise of a sound granted in part and denied in
discretion." Filtrol Corp. v. Kelleher, 467 F.2d part:
242, 244 (9th Cir. 1972). Reflecting this
discretion, § 1292(b) provides that a. The motion to
"application for an appeal hereunder shall not certify is granted.
stay proceedings in the district court unless b. The motion to
the district judge or the Court of Appeals or a stay is denied. The
judge thereof shall so order." 28 U.S.C. § proceedings before
1292(b). In deciding whether to grant a stay, this Court shall be
the Court must weigh various competing not stayed during
interests, including the possible damage, the pendency of
hardship, or inequity which may result from the appeal.
granting the stay or allowing proceedings to
BY THE COURT:
Page 4
__________
continue. Filtrol Corp., 467 F.2d at 244. The John M. Gerrard
Court must also consider the effect of a stay on United States District Judge
the "orderly course of justice measured in
terms of the simplifying or complicating of
issues, proof, and questions of law." Id.

Having considered these factors, the


Court declines to stay proceedings during this
appeal. Plaintiff opposes the stay, as she wants
to resolve this case as soon as possible.
Defendants' main argument is that time and
money will be saved by a stay, as a reversal
would narrow the scope of necessary
discovery. At the same time, however,
defendants have promised to "vigorously
explore Plaintiff's alleged diversity jurisdiction
through discovery." Filing 100 at 2. The Court
finds that the plaintiff has more to lose from a
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EXHIBIT K

Case 3:18-cv-00017-NKM-JCH Document 148-11 Filed 06/06/19 Page 1 of 8 Pageid#:


2362
Navajo Nation, Corp. v. Urban Outfitters, Inc. (D. N.M., 2015)

THE NAVAJO NATION, a sovereign Page 2


Indian Nation, DINE DEVELOPMENT
CORPORATION, a corporation wholly- I. Procedural Background
owned by and formed under
the laws of the Navajo Nation, and On February 28, 2012, Plaintiffs filed their
NAVAJO ARTS AND CRAFTS original Complaint seeking injunctive relief
ENTERPRISE, a wholly-owned and damages (ECF No. 1). Plaintiffs
instrumentality of the Navajo Nation, subsequently filed three amended complaints,
Plaintiffs, all of which alleged infringement of at least
v. nine of their federally-registered trademarks
URBAN OUTFITTERS, INC., UO.COM, in violation of 15 U.S.C. § 1114, among other
L.L.C., URBAN OUTFITTERS state and federal claims.
WHOLESALE, INC.,
ANTHROPOLOGIE, INC., On April 22, 2013, Defendants filed
ANTHROPOLOGIE.COM, various counterclaims, including
L.L.C., FREEPEOPLE of PA, L.L.C., and Counterclaim V, a request for a declaratory
FREEPEOPLE.COM, judgment that Plaintiffs' federal registrations
L.L.C., a Delaware Corporation, for their Navajo marks are invalid and subject
Defendants. to cancellation. (ECF No. 57, ¶¶ 107-110).
Counterclaim V states:
CIV No. 12-195 LH/LAM
108. [Plaintiffs'] federal
UNITED STATES DISTRICT COURT registrations for NAVAJO marks
FOR THE DISTRICT OF NEW MEXICO are invalid and subject to
cancellation on the basis that
February 12, 2015 they were merely descriptive
and/or geographically
MEMORANDUM OPINION AND descriptive and have become a
ORDER generic term for a type or
category of style or design.
THIS MATTER comes before the Court
on Defendants' Motion for Certification
Pursuant to 28 U.S.C. § 1292(b) or,
Alternatively, for Entry and Certification of 109. The term "NAVAJO" in
Partial Final Judgment Pursuant to Rule 54(b) [Plaintiffs'] federal registrations
(Mot. for Certification, ECF No. 196). Briefing for NAVAJO-formative marks
on this motion was completed on November should be disclaimed on the
24, 2014. The Court, having read the motion basis that the term is merely
and briefs of the parties as well as relevant descriptive or has become a
caselaw and being fully advised in the generic term for a type or
premises, concludes that Defendants' motion category of style or design.
for certification is well taken and shall be
granted, and that this Court hereby certifies
an interlocutory appeal. In the event
Defendants file a timely petition for 110. Accordingly, pursuant to 15
interlocutory appeal with the Tenth Circuit U.S.C. §§ 1119 and 1064,
Court of Appeals, this matter shall be stayed Counterclaimants hereby seek a
in its entirety, pending the Tenth Circuit's declaration that the Nation's
review of the matter. federal registrations for

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2363
Navajo Nation, Corp. v. Urban Outfitters, Inc. (D. N.M., 2015)

NAVAJO marks are invalid and under FED.R.CIV.P. 12(b)(1) for lack of subject
an Order that the Nation's matter jurisdiction.
registrations for NAVAJO marks
are cancelled, and the term In this ruling, the Court construed
"NAVAJO" in the Nation's Counterclaim V as a claim for invalidation,
NAVAJO-formative marks be cancellation and disclaimer of trademarks of
disclaimed. the Nation under 15 U.S.C. §§ 1119 and 1064 of
the Lanham Act ("the Act"). When addressing
In short, in this counterclaim Defendants the recoupment issue, the Court explained its
asked the Court to declare that the Nation's understanding as to the impact that the relief
federally registered NAVAJO trademarks are sought by Defendants in Counterclaim V
invalid and subject to cancellation on the basis would have, if granted. "This relief, if obtained,
that they are "merely descriptive and/or would forever bar the Nation from claiming a
geographically descriptive and have become a trademark, pursuant to its federal
generic term for a type or category of style or registrations, against any party, not just
design." (Id. at ¶ 108). Further, this against Defendants. Winning on Counterclaim
counterclaim seeks disclaimer of the term V would allow Defendants (and all others) free
'NAVAJO' in the Nation's federal registrations use of the NAVAJO mark in the future." (Mem.
for NAVAJO-formative marks on the same Op. and Order, ECF No. 179 at 15).
basis. (Id. at ¶ 109).
Page 4
Page 3
II. Defendants' Motion for Certification
On March 6, 2014, Plaintiffs filed a
Motion to Dismiss Counterclaim V Pursuant to Defendants' motion asks this Court to
12(b)(1) and 12(b)(6) ("Pls.' Mot. to Dismiss," certify its September 19, 2014 Memorandum
ECF No. 105), arguing, among other things, Opinion and Order for interlocutory appeal
that Counterclaim V should be dismissed pursuant to 28 U.S.C. § 1292(b), or
based on the doctrine of sovereign immunity. alternatively, to enter a partial final judgment
(Id. at 5-12). On September 19, 2014, the Court pursuant to FED.R.CIV.P. 54(b), thereby
entered a Memorandum Opinion and Order, permitting Defendants to seek interlocutory
dismissing Counterclaim V with prejudice. review of the Memorandum Opinion and
(ECF No. 179). Order. (Mot. for Certification at 5, ECF No.
196).
In this ruling, the Court found: (1) the
Lanham Act applies to Plaintiffs; (2) Defendants contend that the Court's
notwithstanding the applicability of the September 19, 2014 holding involves a
Lanham Act to Plaintiffs and to Plaintiffs' controlling question of law over which there is
claims, Plaintiffs are not subject to suit under substantial ground for difference of opinion,
the Lanham Act due to the doctrine of namely whether sovereign immunity permits
sovereign immunity; and (3) Counterclaim V the Nation to claim infringement of its
does not sound in recoupment and therefore trademarks under the Lanham Act while
Plaintiffs have not waived sovereign simultaneously being protected from having
immunity. As to whether the Plaintiffs' them cancelled, invalidated or disclaimed.
trademarks are subject to cancellation under Defendants assert that immediate appellate
the Lanham Act, the Court reasoned that there review is necessary because this issue goes to
is no language suggesting that Congress had the enforceability of the very trademarks that
"unequivocally waived tribal immunity under the Nation is claiming have been infringed in
the Act." The Court dismissed Counterclaim V violation of the Lanham Act. (Id.).
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Navajo Nation, Corp. v. Urban Outfitters, Inc. (D. N.M., 2015)

The statute imposes three criteria for a if Counterclaim V is reinstated by the appellate
district court's exercise of discretion to grant a court and if they are thereafter able to achieve
§ 1292(b) certificate. The relevant language of cancellation of the Nation's registrations, this
28 U.S.C. § 1292 is: will result in the loss of evidentiary
presumptions afforded by ownership of the
(b) When a district judge, in registrations. They explain more fully that a
making in a civil action an order certificate of registration from the Patent and
not otherwise appealable under Trademark Office gives rise to a presumption
this section, shall be of the of the validity of the trademark. 15 U.S.C. §
opinion that such order involves 1057(b). If a registered mark has become
a controlling question of law as incontestable under 15 U.S.C. § 1065, then the
to which there is substantial registration provides conclusive evidence of
ground for difference of opinion the validity of the registered mark. 15 U.S.C. §
and that an immediate appeal 1115(b). On the other hand, if the Nation's
from the order may materially registrations are cancelled and the Nation is
advance the ultimate not entitled to the benefit of any evidentiary
termination of the litigation, he presumptions, then the Nation must establish
shall so state in writing in such that it has valid, protectable trademark rights
order. in the term "Navajo." On this basis,
Defendants contend that the issue of whether
Rule 54(b) provides: or not the Nation is entitled to federal
registration of its alleged trademarks, and the
When more than one claim for evidentiary presumptions that accompany
relief is presented in an action, those registrations, will certainly affect the
whether as a claim, evidentiary burdens of the parties at trial and
counterclaim, cross-claim, or in the course of this litigation and is a
third party claim, or when controlling question of law. (Mot. for
multiple parties are involved, the Certification at 5-6, ECF No. 196). Under the
court may direct the entry of a same reasoning, Defendants contend the
final judgment as to one or more statutory requirement of material
but fewer than all of the claims advancement of the ultimate termination of
or parties only upon an express litigation is met.
determination that there is no
just reason for delay and upon an As to the last statutory requirement,
express direction for the entry of Defendants contend that there is a substantial
judgment. ground for difference of opinion here, given
the lack of direct legal authority on the issue as
Page 5 to whether the Nation may seek to enforce
trademark rights granted to them under the
III. Applicability of 28 U.S.C. § 1292
Lanham Act

A. Position of Defendants
Page 6

Defendants argue that the first


while at the same time claiming immunity
requirement under § 1292(b) is satisfied
from any effort to challenge the validity of
because resolution of this question on appeal
those trademarks. (Id. at 6).
could materially affect the outcome of the
litigation in district court. In arguing that this 2. Position of the Nation
is a controlling question of law, they assert that

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2365
Navajo Nation, Corp. v. Urban Outfitters, Inc. (D. N.M., 2015)

The Nation addresses the first litigation, but would in fact complicate and
requirement under § 1292(b), arguing that the lengthen it. This is because the now dismissed
sovereign immunity issue is not "controlling," counterclaim seeks to invalidate all of the
because dismissal of the counterclaim could be Nation's 86 registered trademarks, that are
upheld on appeal on at least two other applied to approximately 22 classes of goods,
grounds. In other words, the Nation's premise while the Nation's remaining claim relates to a
is that under § 1292(b), a question of law is much smaller number of trademarks in the
"controlling" only if an error on that question class of clothing, jewelry and accessories.
would constitute reversible error on final (Decl. of Karin B. Swope, ECF No. 201). The
appeal. The Nation contends that, if the Nation notes that discovery and trial on these
counterclaim can be dismissed on other allegations would vastly expand the scope of
grounds, the question of law raised by this case. The Nation argues that this result
Defendants in their certification motion is not would actually be contrary to the purposes of §
deemed to be "controlling." Specifically, the 1292(b), which is to save time and money, and
Nation contends that dismissal of the that reinstatement of Counterclaim V would
counterclaim could also be affirmed under have the opposite effect. In short, the Nation
Rule 12(b)(6) - a ground that was not argues that because the relief that Defendants
addressed by this Court in its September 19, seek via this appeal would expand greatly,
2014 ruling, and alternatively that the Court rather than materially advance termination of
could have declined to exercise jurisdiction the litigation, this request must be denied.
under the Declaratory Judgment Act. The
Nation contends that because dismissal of Finally, the Nation argues that the mere
Counterclaim V could be affirmed on these presence of an immunity issue does not justify
additional grounds, sovereign immunity does an appeal, and that in any event, the Tenth
not present a controlling question of law. Circuit may never have to reach this issue if the
Finally, the Nation disputes that dismissal of Nation's infringement claims are dismissed. In
Counterclaim V significantly affects the other words, if the Nation fails to prove its case
evidentiary posture of this case because the at the district court level, the question which
presumption of validity of its trademarks may Defendants seek to have certified would never
be rebutted either by way of an affirmative have to be reached by the Tenth Circuit.
defense or by way of a counterclaim seeking
cancellation. IV. The Requirements for Certification
Under 28 U.S.C. § 1292(b) Have Been
Insofar as the second requirement under Met
the statute, the Nation argues that because this
Court's decision was made under well-settled As noted above, pursuant to the statute,
principals, there can be no substantial ground the underlying order must (1) involve a
for difference of opinion, even if the exact issue controlling question of law, (2) offer
has not previously been decided. substantial ground for difference of opinion as
to its
Page 7
Page 8
Thirdly, the Nation argues that an
immediate appeal would not advance the correctness, and (3) if appealed immediately
ultimate termination of this litigation. Instead, materially advance the ultimate termination of
the Nation argues that if Counterclaim V were the litigation.
revived, this would not change the case's basic
evidentiary posture but would expand its Under the statutory framework, courts
scope, and that it would not shorten the look for a controlling question that has the
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2366
Navajo Nation, Corp. v. Urban Outfitters, Inc. (D. N.M., 2015)

potential to substantially accelerate The Nation attempts to downplay the


disposition of the litigation. The critical importance of the issue, arguing that a party
requirement is that resolution of the question can collaterally attack the registration of
will advance the ultimate resolution of the another party's trademarks, either by way of
litigation. 19 JAMES WM. MOORE ET AL., an affirmative defense or by way of a
MOORE'S FEDERAL PRACTICE § 203.31[3] counterclaim seeking cancellation of the
(3d ed. 2014). As noted by the Tenth Circuit in registration, if the mark has not become
Utah ex rel. Utah State Dep't of Health v. incontestable. On this basis, the Nation
Kennecott Corp., 14 F.3d 1489, 1495 (10th Cir. contends that resolution on appeal of the issue
1994), the purpose of § 1292(b) is to avoid will not change how the litigation is conducted,
wasted district court time. and that it would not materially affect the
outcome or advance the ultimate resolution, of
Conversely, a legal question cannot be the litigation.
termed "controlling" if litigation would be
conducted in much the same manner The Court disagrees. The Court's
regardless of the disposition of the question September 19, 2014 ruling precluded
upon appeal. Bank of New York v. Hoyt, 108 Defendants from pursuing Counterclaim V,
F.R.D. 184, 188 (D.R.I. 1985). As noted by the which sought a ruling from this Court that the
Third Circuit, "[C]ontrolling means serious to Nation's trademark registrations were invalid
the conduct of the litigation, either practically and subject to cancellation on the basis that
or legally . . . . And on the practical level, saving they had become generic. Although
of time of the district court and of expense to Defendants' affirmative defense of genericness
the litigants was deemed by the sponsors to be is related to it, Counterclaim V encompasses
a highly relevant factor." Katz v. Carte Blanche much broader implications. By dismissing
Corp., 496 F.2d 747, 755 (3d Cir.)(citations Counterclaim V, the Court foreclosed
omitted), cert. denied, 419 U.S. 885 (1974). Defendants from potentially obtaining
See also In re Baker & Getty Financial cancellation of the Nation's registered
Services, 954 F.2d 1169, 1172 n.8 (6th Cir. trademarks, which would not have been of
1992)("[A]ll that must be shown in order for a effect in this litigation only, but could have
question to be controlling is that resolution of allowed Defendants and all others free use of
the issue on appeal could materially affect the the NAVAJO mark in the future.
outcome of the litigation in the district court.")
(internal quotation marks and citations Consequently, it would be far more
omitted). efficient to obtain a ruling by the Tenth Circuit
on this issue at this juncture, rather than face
Bearing this guidance in mind, the Court possible reinstatement of Counterclaim V in a
is convinced that the issue involving propriety post-trial appeal, which could result in a
of the dismissal of Counterclaim V is a lengthy and expensive re-trial. Clearly,
controlling question, in part because this issue reinstatement of Counterclaim V would alter
will significantly affect the further course of significant aspects of this case and have a
the litigation. As noted herein at page 7, the tremendous effect on the conduct of the
Nation litigation, in ways much different and more
far-reaching than the mere assertion of an
Page 9 affirmative defense of genericness. On
balance, as frustrating and inconvenient as an
itself has pointed out how drastically different interlocutory appeal may be, this interruption
the scope of the case will be, if Counterclaim V now in the district court proceedings could
is reinstated in the case. save a

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2367
Navajo Nation, Corp. v. Urban Outfitters, Inc. (D. N.M., 2015)

Page 10 put this issue to rest once and for all if it so


chooses.
great deal of time and expense in the long run,
and would best serve considerations of judicial Page 11
economy and fairness to the litigants. A ruling
by the Tenth Circuit at this juncture will The Court notes that this issue is well
interject certainty on this controlling question suited for an interlocutory appeal because it
of law, for purposes of Counterclaim V, as well presents clear-cut questions of law against a
as for the assertion of Defendants' affirmative background of established facts. The Court
defenses. believes that the issue involving Counterclaim
V is an important and close question of law.
Furthermore, the Court agrees with
Defendants that an immediate appeal will V. Conclusion
conclusively resolve a central issue in this case,
i.e., whether sovereign tribal immunity should This Court is well aware that § 1292(b)
protect the Nation from cancellation of the should be construed strictly and that appeals
trademarks they sued Defendants for allegedly under this section are disfavored and should
infringing. Immediate resolution of the be allowed only sparingly. The Court
immunity issue will have an effect on whether concludes, in its discretion, that this is one of
or not the Nation may take advantage of the exceptional instances where an
evidentiary presumptions that flow from interlocutory appeal should be certified.
possession of registered trademarks. If the
Nation's registrations are cancelled, the For the reasons set forth above, this Court
Nation would not be entitled to the evidentiary concludes that the September 19, 2014
presumptions afforded by such registrations, Memorandum Opinion and Order satisfied the
and the Nation would have to carry the burden three criteria set required by § 1292(b), and is
at trial of demonstrating that it has valid, hereby amended to state that it involved a
protectable rights in the term "Navajo." controlling question of law as to which there is
substantial ground for difference of opinion
For these reasons, the Court concludes and that an immediate appeal therefrom may
that an immediate appeal will materially materially advance the ultimate termination of
advance the orderly presentation of evidence the litigation. On this basis, the Court hereby
at trial and the course of the litigation, and will certifies an interlocutory appeal. Defendants'
advance the ultimate resolution of the petition for such an immediate interlocutory
litigation. appeal must be filed, if at all, with the Tenth
Circuit Court of Appeals, within ten (10) days
Finally, the Court agrees with Defendants of entry of this Order. Upon Defendants' filing
that there is a substantial ground for difference of such a petition, all proceedings at the
of opinion as to the controlling questions of district court level shall be STAYED, pending
law, as is illustrated by the parties' briefs. the Tenth Circuit's review of the matter.
Obviously this Court would not frivolously
certify an appeal from its own order and does WHEREFORE, IT IS HEREBY
so in this instance only because this is such a ORDERED that Defendants' Motion for
complex and evolving area of law, because Certification Pursuant to 28 U.S.C. § 1292(b)
there is a dearth of direct on-point authority, or, Alternatively, for Entry and Certification of
and because the Court believes there is Partial Final Judgment Pursuant to Rule 54(b)
substantial room for difference of opinion and (Mot. for Certification, ECF No. 196) is
that the circuit should have the opportunity to granted.

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Navajo Nation, Corp. v. Urban Outfitters, Inc. (D. N.M., 2015)

IT IS SO ORDERED.

/s/_________
SENIOR UNITED STATES
DISTRICT JUDGE

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EXHIBIT J

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2358
Kell v. Crowther (D. Utah, 2018)

TROY MICHAEL KELL, Plaintiff, Page 2


v.
SCOTT CROWTHER, WARDEN, UTAH When a district judge, in making
STATE PRISON; Defendant. in a civil action an order not
otherwise appealable under this
2:07-CV-00359-CW section, shall be of the opinion
that such order involves a
UNITED STATES DISTRICT COURT controlling question of law as to
DISTRICT OF UTAH, CENTRAL which there is substantial
DIVISION ground for difference of opinion
and that an immediate appeal
February 8, 2018 from the order may materially
advance the ultimate
MEMORANDUM DECISION AND termination of the litigation, he
ORDER shall so state in writing in such
order.
District Judge Clark Waddoups
28 U.S.C. § 1292(b) (emphasis added). The
On November 16, 2017, the court, in a decision to grant certification lies within the
written order, granted Mr. Kell a limited stay
sound discretion of the district court.
and abeyance only with respect to Claim 3(F)
of his Amended Petition so that he could A. Controlling Question of Law
properly exhaust that claim in state court.
(ECF No. 258.) The court found that under In order to obtain interlocutory review
Rhines v. Weber, 544 U.S. 269 (2005), Kell under § 1292(b), Respondent must point to "a
had shown a potentially meritorious claim, controlling question of law about which there
good cause for the stay and that his tactics is substantial ground for difference of
were not abusive or dilatory. When addressing opinion." Mere disagreement with the court's
the good cause element, however, the court ruling is insufficient. See United States v.
noted a lack of agreement on what that term Grand Trunk W.R.R, 95 F.R.D. 463, 471 (W.D.
means, and a lack of controlling Tenth Circuit Mich. 1981).
precedent. The court's decision was not a final
appealable decision, and the State now seeks The State asserts that this court's Rhines
certification under 28 U.S.C. § 1292(b) to ruling identified and resolved "a controlling
pursue interlocutory appellate review of the question of law"—the meaning of "good cause"
following legal question: What "good cause" under Rhines. The State notes that without
standard must a federal habeas petitioner deciding what the term meant and that Kell
satisfy to obtain a stay-and-abeyance of federal had met the standard, the court could not have
habeas proceedings under Rhines v. Weber, granted Kell's Rhines motion. Although Kell
544 U.S. 269 (2005)? argues that the court did not explicitly
articulate a standard in its Memorandum
Title 28 of the United States Code Decision and Order, a close look at the order
addresses the court of appeals' limited shows that the court adopted the lower Blake
appellate jurisdiction over interlocutory standard. The court noted that ineffective
decisions. Respondent relies on a subpart of assistance of post-conviction counsel would
28 U.S.C. § 1292, which sets forth an exception satisfy Rhines good cause only under Blake's
to the general rule that interlocutory decisions lower standard, and then found that "post-
are not appealable: conviction counsel's deficient performance" in

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Kell's case "constitutes cause under Rhines." cause under Rhines is a controlling question of
(ECF No. 258 at 5.) law.

The parties agree that "controlling B. Substantial Ground for


question[s] of law" under § 1292(b) include Difference of Opinion
questions that (1) are "serious to the conduct
of the litigation, either practically or legally," The standard for a substantial ground for
Katz v. Carte Blanche Corp., 496 F.2d 747, 755 difference of opinion is met "where 'the
(3d Cir. 1974); (2) could "affect the ability of circuits are in dispute on the question and the
the district court to render a binding decision" court of appeals of the circuit has not spoken
or "materially affect the outcome of the on the point, if complicated questions arise
litigation in the district under foreign law, or if novel and difficult
questions of first impression are presented.'"
Page 3 Couch v. Telescope, Inc., 611 F.3d 629 (9th Cir.
2010) (internal citation omitted). The State
court," In re Cement Antitrust Litig., 673 F.2d fails to meet this requirement. While this court
1020, 1027 (9th Cir. 1981); or (3) "might save recognized that some
time for the district court, and time and
expense for the litigants," Johnson v. Burken, Page 4
930 F.2d 1202, 1206 (7th Cir. 1991). This
court's good cause determination, and the district courts have reached different
resulting stay, fits each of these. conclusions about what is required to show
good cause for a Rhines stay (see ECF No. 258,
First, the court must consider whether its at 3), the decisions in this district which have
decision to grant a limited stay as to claim 3(F) addressed the issue have predominantly
is serious to the conduct of the litigation, either applied the standard adopted in Blake v.
practically or legally. Kell argues that it has no Baker, 745 F.3d 977 (9th Cir. 2014) and Rhines
bearing on the court's ability to substantively v. Weber, 408 F.Supp. 844, 848-49 (D.S.D
decide his claims (citing In re Cement 2005) (Rhines II). Some of these courts have
Antitrust Litig., 673 F.2d 1020, 1027 (9th Cir. granted stays based on that standard (see, e.g.,
1981)). He argues that a stay order "merely Archuleta v. Crowther, No. 2:07-CV-630, ECF
regulate[s] the course of the proceedings" No. 107 (D. Utah, Nov. 12, 2014); and Taylor
(citing Swanson v. DeSantis, 606 F.3d 829, v. Turley, No. 2:07-CV-194, ECF No. 45 (D.
932 (6th Cir. 2010)). The court disagrees. The Utah, Feb. 14, 2008)), while others have
Rhines order clearly bears on this court's adopted the standard but have denied the stay
ability to reach claim 3(F) because, without a for other reasons, see, e.g., Lafferty v.
stay that enables Kell to exhaust the claim, it Crowther, No. 2:07-CV-322, ECF No. 379 (D.
remains unexhausted and beyond merits Utah, Oct. 30, 2015); and Honie v. Crowther,
review. The court's order permits Kell to 2:07-CV-628, ECF No. 120 (D. Utah, Dec. 13,
exhaust the claim and then present it in this 2017).
court for merits review. Whether Kell met the
Rhines "good cause" standard thus has a One Utah case, Carter v. Friel, 415
substantial effect on this court's ability to F.Supp.2d 1314 (D. Utah 2006), followed
reach the merits of Kell's claim. For this reason Hernandez v. Sullivan, 397 F.Supp.2d 1205,
the question could "materially affect the 1207 (C.D. Cal. 2005), a case in which the
outcome of the litigation in the district court." district court reached a different conclusion
In re Cement Antitrust Litig., 673 F.2d at 1027. about the good cause standard. In the absence
Thus, the question of what constitutes good of other guidance, the Hernandez court found
an analogy to the standard applied in
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procedural default cases and applied what it not grant a stay with respect to any other claim
referred to as an objective standard. But as this in the petition. So while Mr. Kell returns to
court observed, the Hernandez analysis was state court to exhaust Claim 3(F), this court
subsequently rejected by the Ninth Circuit in will move forward in deciding the remainder of
Blake. Although Carter, which was decided Mr. Kell's claims. The only way that an
only a year after Rhines, followed Hernandez, interlocutory appeal would advance the
the court did not have the benefit of the later ultimate termination of the litigation, is if the
analysis by the Ninth Circuit in Blake. No court Tenth Circuit were to decide the "good cause"
in this district has since followed Carter. standard differently than this court did, and if
Moreover, the Carter court, upon remand Kell were unable to prove good cause under the
from the Tenth Circuit, recently granted a different standard, meaning he would not be
Rhines stay in the same case to allow Carter to entitled to a Rhines stay, so the entire petition
exhaust some of his claims in state court. could be decided immediately. See Rhines, 544
Carter v. Crowther, 2:02-CV-326, ECF No. U.S. at 276-78. If the stay order were affirmed,
576, 2016 WL 843273 (D. Utah, March 1, on the other hand, "the interlocutory appeal
2016). would have delayed the ultimate termination
of this case rather than advanced it." See
Thus, the present state of the law is that in Valdovinos v. McGrath, 2007 WL 2023505 at
this district the predominant trend is to follow *4 (N.D.Cal. July 12, 2007).
the Blake good cause standard. Given this
trend, there is not sufficient basis to find a For the above reasons, the court hereby
difference of opinion on which standard DENIES Respondent's Motion to Amend
should apply. The State also fails to cite to a Rhines Order to Include Certification Under
difference among the 28 U.S.C. § 1292(b). (ECF No. 261.)

Page 5 Page 6

circuits. There is not a substantial IT IS SO ORDERED.


disagreement among any binding authorities
that a standard other than the one applied by DATED this 8th day of February, 2018.
the court in this case should apply. Under
these precedents, there is no substantial BY THE COURT:
ground for an interlocutory appeal.
/s/_________
C. Materially advance the ultimate CLARK WADDOUPS
termination of the litigation United States District Court Judge

Having found no substantial ground for


difference of opinion, this court need not
consider whether an immediate appeal from
the Rhines order "may materially advance the
ultimate termination of the litigation." 28
U.S.C. § 1292(b). However, it does not appear
that an immediate appeal would necessarily
materially advance the termination of the
litigation. This court granted "a limited stay
and abeyance only with respect to Claim 3(F)"
of Mr. Kell's Amended Petition. (ECF No. 258
at 11-12 ) (emphasis in original). The court did
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EXHIBIT L

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Louis v. Flagship Airlines, Inc., 181 F.3d 79 (1999)

KeyCite Yellow Flag - Negative Treatment


Distinguished by In re Ace American Insurance Company, Tex.App.-
Dallas, June 15, 2018
181 F.3d 79
Unpublished Disposition I. Background
NOTICE: THIS IS AN UNPUBLISHED OPINION.
(The Court’s decision is referenced in a “Table of In the first leg of a journey to Haiti, Louis boarded an
Decisions Without Reported Opinions” appearing in American Eagle (“American”) commuter flight at Boston’s
the Federal Reporter. Use FI CTA1 Rule 36 for rules Logan airport on January 6, 1994. The flight was
regarding the citation of unpublished opinions.) subsequently canceled, and the passengers were asked to
United States Court of Appeals, First Circuit. deplane. When descending the stairs to the tarmac, Louis
slipped and fell on an icy patch. She declined American’s
Martha Moise LOUIS, Plaintiff, Appellant, offer to arrange and pay for immediate medical assistance.
v. More than a year and a half later, in August 1995, her
FLAGSHIP AIRLINES, Inc. d/b/a American attorney sent a letter to American seeking a report of the
Eagle, American Airlines, Inc., and ICALM Group, incident. American responded in October 1995 that it was
Inc., Defendants, Appellees. commencing an investigation of the accident and requested
information about Louis’s injuries. Her counsel sent the
No. 98-1753. material on November 5, 1995.
|
Feb. 5, 1999. American forwarded the package to its insurance adjuster,
ICALM, a New York corporation with its principal place
of business in North Carolina. On November 20, 1995,
Appeal from the United States District Court for the
ICALM sent Louis a letter requesting that she provide the
District of Massachusetts [Hon. Robert E. Keeton, U.S.
medical and employment authorizations necessary to
District Judge].
verify the nature and extent of her injuries. Louis provided
Attorneys and Law Firms the materials on January 29, 1996, two years and twenty-
three days after the accident. After conducting its own
Marian H. Glaser for appellant. investigation, ICALM denied her claim because the
Warsaw Convention’s two-year statute of limitations had
Dennis J. Kelly with whom Mark J. Ventola and expired. During the entire period, ICALM contacted Louis
Christopher D. Engebretson were on brief for appellees. or her attorney four times: once to request the
authorizations, twice to return calls from Louis’s attorney,
Before SELYA, Circuit Judge, COFFIN, Senior Circuit and once to inform Louis that her claim had been denied.
Judge, and BOUDIN, Circuit Judge.
Louis subsequently filed suit in Massachusetts against
Opinion American for negligence and against ICALM for unfair or
deceptive insurance practices. When both American and
ICALM moved for summary judgment, the court dismissed
COFFIN. the claim against American as barred by the statute of
limitations. It also expressed doubt about its ability to
exercise personal jurisdiction over ICALM, and asked
*1 After sustaining injuries while descending stairs from
Louis to file a supplemental memorandum detailing
an airplane, Martha Moise Louis (“Louis”) filed suit
ICALM’s relevant in-state activities. Louis filed both the
against the airline and its insurance adjuster, ICALM. The
supplemental memorandum and a motion to amend the
court: 1) dismissed the claim against ICALM for lack of
complaint to add “Underwriters of Lloyd’s of London” as
personal jurisdiction; 2) denied Louis’s motion to amend
a defendant. The court denied her motion to amend, and
the complaint; and 3) denied her motion for post-judgment
dismissed the claims against ICALM for lack of personal
discovery regarding the identity of other possible
jurisdiction. Louis then filed a post-judgment discovery
defendants.1 Louis now appeals all three decisions.
motion in an attempt the learn the names of other
Because the court’s rulings were entirely appropriate, we
defendants who might not be covered by the same statute
affirm.
of limitations as American, but again the court denied her
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entreaty. between the parties. See, e.g., Tatro v. Manor Care, Inc.,
416 Mass. 763, 625 N.E.2d 549, 553 (Mass.1994). In non-
contractual cases such as this one Massachusetts has
required more than the four contacts that occurred here for
its courts to exercise jurisdiction. See New Hampshire Ins.
Guar. Ass’n v. Markem Corp., 424 Mass. 344, 676 N.E.2d
809, 812 (Mass.1997) (finding in action by third party that
II. Discussion foreign insured had not transacted business in
Massachusetts simply because foreign insurer had
*2 The district court’s opinions are lengthy and thoughtful,
conducted some administration of insured’s policies in
and we need not linger in our discussion of the issues.
Massachusetts). Even the most liberal interpretation of
ICALM’s in-state activities would not permit personal
jurisdiction under this prong of the statute.

Subsection (c) is equally inapplicable since it requires the


A. Personal Jurisdiction tortious act to be within Massachusetts. The complaint
District courts may exercise personal jurisdiction over out- alleged that ICALM delayed its investigation and failed to
of-state defendants if “such jurisdiction is authorized by affirm or deny coverage within a reasonable time.
state statute or rule and its exercise does not offend due ICALM’s actions and alleged omissions, consisting solely
process.” United Elec. Workers v. 163 Pleasant Street of examining the related documents and denying coverage,
Corp., 960 F.2d 1080, 1086 (1st Cir.1992). In relevant part took place entirely at its offices in North Carolina.
the Massachusetts long-arm statute provides for personal
jurisdiction over a defendant in another state if he: Subsection (d) does allow a plaintiff to file suit for injuries
(a) transact[s] any business in [Massachusetts]; in Massachusetts based on tortious acts or omissions
outside the state. However, Louis’s complaint cannot meet
... the other element of that subsection, which requires a
finding that ICALM “regularly does or solicits business, or
(c) caus[es] tortious injury by an act or omission in engages in any other persistent course of conduct, or
[Massachusetts]; [or] derives substantial revenue from ... services rendered, in
[Massachusetts].” As stated earlier, ICALM does not do
(d) caus[es] tortious injury in [Massachusetts] by an act or business in Massachusetts, or solicit business there. Nor
omission outside [Massachusetts] if he regularly does or does it derive substantial revenue from services rendered
solicits business, or engages in any other persistent course there.3 A finding that ICALM’s two letters and two phone
of conduct, or derives substantial revenue from goods used calls constituted a “persistent course of conduct” would
or consumed or services rendered, in [Massachusetts]; stretch that term beyond all recognition.

*3 The long arm statute simply does not allow courts in


Mass. Gen. L. ch. 223A, § 3. Massachusetts to exercise jurisdiction over ICALM under
the facts of this case, as the district court correctly ruled.
In its opinion, the district court correctly found that none
of these standards had been met. Subsection (a) requires
the defendant to have transacted business in Massachusetts.
ICALM, a New York corporation with its principal place
of business in North Carolina, marketed its services to
American, a Delaware corporation with principal places of B. Motion to amend
business in Texas and Tennessee.2 ICALM has never After the court permitted Louis to fortify her filing with
maintained any presence in Massachusetts, nor is it respect to ICALM’s in-state activities, Louis filed a
registered to do business there. Its only contacts with supplemental memorandum and a motion to amend the
Massachusetts arise from adjusting claims made by complaint to add “Underwriters of Lloyd’s of London” as
Massachusetts residents against its clients located a defendant. Noting both that it was an attempt to delay the
elsewhere. inevitable dismissal of the action against the current
defendants and that Louis had learned about the insurance
Most cases exploring the reach of the “transacting company’s identity four months earlier, the court denied
business” language involve direct contractual relations her motion. We review such a decision under an abuse of
discretion standard, and “defer to the district court if any
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adequate reason for the denial is apparent on the record.” will be overruled only if it abused that discretion. Daigle v.
Grant v. News Group Boston, Inc., 55 F.3d 1, 5 (1st Maine Med. Ctr., Inc., 14 F.3d 684, 692 (1st Cir.1994); see
Cir.1995). also Mack v. Great Atlantic and Pacific Tea Co., Inc., 871
F.2d 179, 186 (1st Cir.1989) (requiring the ruling to be
It is evident that the court did not abuse its discretion. A “plainly wrong and result[ ] in substantial prejudice”).
finding that Louis unduly delayed filing the motion is an
adequate reason to deny it. See Acosta-Mestre v. Hilton Since the district court succinctly and aptly disposed of this
Int’l of Puerto Rico, Inc., 156 F.3d 49, 51 (1st Cir.1998). issue, we quote its language here at length:
The action began on December 31, 1996.4 On October 1, Essentially, plaintiff asks the court to stay the case until
1997, Louis learned that Lloyd’s was the insurer. However, defendants, after the court has ruled that plaintiff does not
she neglected to move to amend until February 19, 1998, have any legally cognizable claims against them, tell
fourteen months after the original complaint was filed and plaintiff who was the owner of the staircase on which
more than four months after she discovered the insurer’s plaintiff fell.
identity. The district court found that this four month wait
constituted undue delay, especially in light of the court’s Plaintiff’s request for discovery after a final judgment in
intervening ruling that the claim against American was this civil action, without even a contention that the
dismissed and the claims against ICALM would likely be requested discovery would be material to the outcome of
as well. The district court’s reason for denying her motion this civil action, is simply unprecedented and has no
is sufficient. support at law.

*4 Because all three decisions challenged on appeal were


entirely appropriate, the decision is affirmed.

C. Post-Judgment Discovery
Louis subsequently filed a motion asking the court to stay All Citations
judgment, to reconsider and to permit discovery of other
possible defendants. It was denied. The district court has 181 F.3d 79 (Table), 1999 WL 525947
considerable discretion in ruling on discovery motions and

Footnotes

1 The court also dismissed the claim against the airline as barred by the statute of limitations, but Louis has not appealed that ruling.

2 Defendant American is really three interrelated companies: American Eagle, American Airlines and Flagship Airlines. Both American
Eagle and American Airlines are Delaware corporations with principal places of business in Texas. Flagship Airlines’ principal place
of business is in Tennessee. The distinction, however, is irrelevant for the purposes of personal jurisdiction in this case.

3 Since its formation in 1990 ICALM has adjusted an average of two claims per year by Massachusetts residents against its clients.
This does not approach the level of “substantial revenue.”

4 The complaint was originally filed in Suffolk Superior Court, but the action was removed to federal court on March 26, 1997.

End of Document © 2019 Thomson Reuters. No claim to original U.S. Government Works.

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