Commercial Litigation and Arbitration

No Pendent Appellate Jurisdiction Over Denial of Summary Judgment Is Conferred by Appealable, Intertwined Denial of Preliminary Injunction — At Least, Where Possibility of Prevailing Still Exists

From Byrum v. Landreth, 2009 U.S. App. LEXIS 8312 (5th Cir. April 22, 2009):

In this commercial speech case, the appellants would prevent Texas from enforcing its interior design "titling" law, which prohibits unlicensed practitioners from using the terms "interior designer" or "interior design" to describe their trade and the services they provide but does not limit who may practice interior design. The district court denied their motions for preliminary injunction and summary judgment. We have jurisdiction over the former order, 28 U.S.C. § 1292(a), but not over the latter except by exercising pendent appellate jurisdiction.

Because the district court abused its discretion by denying the preliminary injunction, we reverse for entry of relief. We decline, however, to exercise pendent appellate jurisdiction to resolve the appellants' summary judgment motion.

***

The denial of the appellants' preliminary injunction motion is an appealable interlocutory order, 28 U.S.C. §1292(a)(1), but the denial of their summary judgment motion is not, Meza v. Livingston, 537 F.3d 364, 366 (5th Cir. 2008). The appellants request us to exercise pendent appellate jurisdiction over their denied motion for summary judgment, but we decline the invitation.

Pendent appellate jurisdiction may exist where, in the interest of judicial economy, courts have discretion to review interlocutory rulings related to independently appealable orders when the two are "inextricably intertwined." Swint v. Chambers County Comm'n, 514 U.S. 35, 43-44, 51, 115 S. Ct. 1203, 1208-09, 1212; Wallace v. County of Comal, 400 F.3d 284, 291-92 (5th Cir. 2005). Although Swint did not foreclose pendent appellate jurisdiction in all circumstances, the opinion emphasized that courts should not circumvent congressional intent by grafting ad hoc appellate jurisdictional rules on the statutory grant of jurisdiction. Swint, 514 U.S. at 46-47, 50-51, 115 S. Ct. at 1210-12. Following Swint, this court has held that, "[p]end[ent] appellate jurisdiction is only proper in rare and unique circumstances where a final appealable order is 'inextricably intertwined' with an unappealable order or where review of the unappealable order is necessary to ensure meaningful review of the appealable order." Thornton v. General Motors Corp., 136 F.3d 450, 453 (5th Cir. 1998); see also Gates v. Cook, 234 F.3d 221, 232-33 (5th Cir. 2000) (Jones, J., dissenting). ***

The appellants' chief argument for pendent appellate jurisdiction is that we cannot consider the preliminary injunction ruling here without also considering the very same law and facts on which the district court premised its denial of summary judgment. The district court denied the motions for summary judgment because the State failed to meet its evidentiary burden to show that the terms "interior design" and "interior designer" are inherently misleading and that the titling law directly advances the State's interest in consumer protection. In addition, the district court found that neither party produced any evidence regarding whether the restriction was more extensive than necessary to protect the State's interest. Because the summary judgment ruling, like the preliminary injunction test for success on the merits, turns on the Central Hudson factors, appellants contend the rulings are inextricably intertwined.

To support this proposition, appellants cite three cases, all of which are distinguishable. In Lamar Advertising of Penn, LLC v. Town of Orchard Park, 356 F.3d 365 (2d Cir. 2004), Lamar requested both a preliminary injunction and summary judgment in its First Amendment challenge to a local ordinance restricting outdoor advertising.... The district court denied the summary judgment because of mootness and plaintiffs' lack of standing.... But instead of entering a final order, the district court denied Lamar's motion for a preliminary injunction and set a trial date.... When Lamar appealed the denial of preliminary injunction, the Second Circuit exercised pendent appellate jurisdiction over the summary judgment motion because "the district court denied Lamar's request for a preliminary injunction for the very same reasons it denied Lamar's motion for summary judgment . . . ." Id. at 372 (emphasis added). Lamaris distinguishable from this case for the reason articulated by the State: the appellate court was required to invoke pendent appellate jurisdiction to correct the error of law — denial of plaintiff's standing — -that had become the basis for the denial of preliminary injunction. In this case, we have reviewed the injunctive order without reaching a dispositive ruling on the First Amendment claim.

The same reasoning disposes of the other cases cited by appellants. See Law v. NCAA, 134 F.3d 1010, 1015-16 (10th Cir. 1998) (the court reviewed the summary judgment order that served as the legal basis for granting the permanent injunction.); Dare v. California, 191 F.3d 1167, 1170 (9th Cir. 1999), (appellate jurisdiction existed because partial "summary judgment order provides legal authority for the injunction . . . ." ). Moreover, in both cases, the summary judgment was subsumed in a permanent injunction ruling.

More pointedly, appellants rely on two cases that employ what might be called a "readily apparent" pendent appellate jurisdiction standard. In both Amandola v. Town of Babylon, 251 F.3d 339 (2d Cir. 2001), and Hurwitz v. Directors Guild of America, Inc., 364 F.2d 67 (2d Cir. 1966), the court reviewed district court rulings denying a motion for preliminary injunction and also denying a motion for summary judgment. In Hurwitz, the court held that the membership oath denying Communist Party membership and support required by the Director's Guild of America was "per se an unreasonable and unlawful requirement for union membership." ... The court then explained it was exercising jurisdiction for "the obvious interest of economy of litigation." Id. Amandola, citing Hurwitz, employs similar reasoning. There, a religious group was denied access to what the group claimed was a limited public forum.... The district court denied the group's motion for preliminary injunction finding no irreparable harm. The Second Circuit reversed, but rather than "address any tension" in its cases regarding irreparable harm and the First Amendment, the court decided the case on the merits.... Citing Hurwitz, it ruled that jurisdiction was appropriate because the First Amendment issue had been fully briefed and argued, and the invalidity of the provision was "readily apparent." ...

The appellants advance a similar argument here. While we are sympathetic that on remand, the State's attempt to justify this speech infringement may readily fail, Central Hudson offers the possibility that the State can bolster its case with additional evidence. But see Pagan v. Village of Glendale, 559 F.3d 477, 479 (6th Cir. 2009) (holding a local commercial speech ordinance unconstitutional because the state did not produce any additional evidence on remand). Although the State moved for summary judgment in the trial court, it never waived its right to a trial. Our approval of a preliminary injunction signals the difficulty of the State's legal position, but it does not entirely foreclose the State from possible eventual success.

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