Monday, November 07, 2005

District Courts Must Spell Out Reasons for FRCP Rule 54(b) Certification Says 10th Circuit

The Tenth Circuit in Stockman's Water Co., LLC v. Vaca Partners, L.P., 425 F.3d 1263 (10th Cir. Oct. 12, 2005) dismissed a matter certified for appeal under FRCP Rule 54(b) on the ground that the district court failed to fulfill its duty to explain the basis for its decision. The rule permits certification of a claim for appeal while other claims remain before the district court provided that the district court makes "an express determination that there is no just reason for delay." The Tenth Circuit has indicated that this language means that courts entering a Rule 54(b) certification should "clearly articulate their reasons and make careful statements based on the record supporting their determination of 'finality' and 'no just reason for delay' so that we [can] review a 54(b) order more intelligently[ ] and thus avoid jurisdictional remands."

Because the district court here offered no analysis of the factors relevant under Rule 54(b), the certification order failed to comport with Rule 54(b)'s requirement that a final judgment be entered only upon an express determination that there is no just reason for delay. As a result, the appellate panel concluded that the district court's certification order failed to provide it with appellate jurisdiction over the appeal.


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