Waetzig v. Halliburton Energy Services, Inc.
LII note: The U.S Supreme Court has now decided Waetzig v. Halliburton Energy Services, Inc.
Issues
Does Rule 60(b) permit plaintiffs to reopen suits that they voluntarily dismissed without prejudice under Rule 41?
This case asks the Supreme Court to determine if courts may relieve a party under Rule 60(b) from a Rule 41 voluntary dismissal without prejudice. Waetzig contends that the language “final judgment, order, or proceeding” in Rule 60(b) includes a Rule 41 voluntary dismissal without prejudice because it is a step in a proceeding that terminates the case. Halliburton Energy Services counters that a voluntary dismissal without prejudice is neither a proceeding nor final because the plaintiff preserves the right to refile suit. The outcome of this case affects federal courts’ ability to grant Rule 60(b) relief to plaintiffs who dismissed their case because of a mistake or fraud.
Questions as Framed for the Court by the Parties
Whether a voluntary dismissal without prejudice under Federal Rule of Civil Procedure 41 is a “final judgment, order, or proceeding” under Federal Rule of Civil Procedure 60(b).
Facts
In February 2020, Gary Waetzig sued Halliburton Energy Services, Inc. (“Halliburton”), his former employer, for violating the Age Discrimination in Employment Act . Waetzig alleged that Halliburton had impermissibly discriminated against him based on his age in its decision to terminate his employment. However, because his employment agreement contained an arbitration clause, Halliburton petitioned to have the claims arbitrated. In response, Waetzig voluntarily dismissed his case under Federal Rule of Civil Procedure (“FRCP”) 41(a)(1)(A) . Because it was the first time that Waetzig had voluntarily dismissed his case, it was automatically without prejudice .
The party’s arbitration clause required the arbitrator to give ten calendar days’ notice to the parties in advance of any hearing, to provide a recording of any such hearing, and to provide a brief statement of the essential findings of fact and conclusions of law to explain the decision. On May 28th, 2021, the arbitrator notified the parties of a telephone conference scheduled for June 2nd, 2021, five calendar days later. At the conference, the arbitrator decided to hear oral arguments for Halliburton’s motion for summary judgment . Later that day, the arbitrator granted the motion but neither made a recording of the hearing nor provided a statement of the essential findings of fact and conclusions of law.
After the arbitration, Waetzig returned to federal court and moved to reopen his case under FRCP 60(b) . Rule 60(b) allows a court to relieve a party from a “final judgment, order, or proceeding” if the party made a mistake, among other reasons. The district court ruled that it could relieve Waetzig from his voluntary dismissal under Rule 60(b) because he had mistakenly chosen to dismiss the case rather than staying it. He could not refile a new case because in the meantime, the Supreme Court had narrowed the circumstances in which a court may overturn arbitration awards in Badgerow v. Walters . The district court then concluded that the arbitrator had exceeded their powers by not providing sufficient notice of the June 2 hearing and not adequately explaining the factual findings and legal conclusions that led to their decision.
The United States Court of Appeals for the Tenth Circuit , through a divided panel, overturned the district court’s holding. It held that Waetzig’s voluntary dismissal without prejudice was not final and neither a judgement, order, nor a proceeding, and therefore the district court could not reopen the case under Rule 60(b). Waetzig petitioned the United States Supreme Court for certiorari , which the Court granted on October 4th, 2024.
Analysis
THE FINALITY OF A VOLUNTARY DISMISSAL
Waetzig claims that because the FRCP does not define “final,” dictionary definitions at the time the rules at issue were adopted offer guidance. For example, Waetzig cites Black’s Law Dictionary, which defines final as “definitive; terminating; completed; conclusive; last,” and as “generally contrasted with ‘interlocutory.’” Waetzig contends that courts could historically use their inherent power to modify interlocutory decisions without Rule 60(b), but needed Rule 60(b) to revisit final decisions because they were case terminating. Waetzig claims that the FRCP’s Advisory Committee Notes on Rule 60(b) support that interpretation, contrasting “final” with “interlocutory” decisions that do not fall within the rule. Waetzig thus argues that a voluntary dismissal is final because it terminates the pending case and leaves nothing to do for the court or defendant. Further, Waetzig asserts that once a plaintiff voluntarily dismisses a case, the district court loses power to rule on other case-related matters, unlike interlocutory decisions.
Further, Waetzig contends that when the FRCP were adopted, it codified existing state procedures and equity rules. At that time, Waetzig claims, if a plaintiff voluntarily terminated a case the court had the authority to later re-open it. Therefore, Waetzig argues that Rule 60(b) adopted this existing practice.
Additionally, Waetzig argues that Rule 60(b) should be read flexibly given its equitable origin. Waetzig notes that the Supreme Court has construed finality flexibly, relying on a “practical rather than technical construction.” Waetzig asserts that the Court should rely on similar equitable considerations here and adopt a sensible meaning of the word final.
Waetzig maintains that even though his case was dismissed without prejudice, it is still final. Waetzig asserts that although he could have immediately filed a new action, the dismissal is not any less final because it was related to the first action and a new suit would not bear on the finality of the first. Further, Waetzig argues that the law treats several other decisions as final even though they are without prejudice. For example, Waetzig notes that an order dismissing a case for lack of personal jurisdiction is without prejudice but nonetheless final for purposes of Rule 60(b).
On the other hand, Halliburton claims that the district court lacked subject-matter jurisdiction over Waetzig’s motion to vacate the arbitral award. Halliburton asserts that Waetzig’s motion only asserted subject-matter jurisdiction under the Federal Arbitration Act (“FAA”). However, Halliburton argues that the Supreme Court has held that FAA does not confer jurisdiction by itself and requires some other jurisdictional basis. Further, Halliburton posits that a Rule 60(b) motion cannot create jurisdiction. Halliburton contends that there is no independent basis for federal jurisdiction—such as diversity jurisdiction —in Waetzig’s motion.
Alternatively, Halliburton claims that history and the words around “final” limit Rule 60(b) to actions that resolve all the relevant issues within their scope. Halliburton argues that in 1946, when the word “final” was added to Rule 60(b), it already had an established legal meaning that carried over. Halliburton notes that the Judiciary Act of 1789 gave circuit courts the ability to hear appeals over “final judgments and decrees.” A judgement or decree, Halliburton explains, is final for purposes of appeals when it “terminates the litigation between the parties on the merits of the case.” Alternatively, for non-merits decisions —a legal ruling by a court that does not address the substantive issues of a case—Halliburton posits a court action is final if it “effectually terminates the particular case, prevents the plaintiff from further prosecuting the same and relieves the defendant from putting in a defense.” Halliburton argues that “final” in Rule 60(b) means the same because an amendment in 1946 copied the “final judgement” language from the Judiciary Act. Halliburton also notes that the Supreme Court usually treats decisions as final at the same time for purposes of both appeals and Rule 60(b).
Next, Halliburton claims that Waetzig’s request for a “practical rather than technical” reading of “final” cuts against him. Halliburton asserts that the Supreme Court reads “final” in a practical way to prevent finality principles from eroding. Therefore, Halliburton argues that the Court should not read final in a way contrary to its established meaning.
Finally, Halliburton claims that voluntary dismissals without prejudice are not final because they do not definitively resolve the dispute because the plaintiff can bring another suit for the same claim. For one, Halliburton asserts that a voluntary dismissal without prejudice is not final for appeals and thus not final for Rule 60(b). Additionally, Halliburton argues that the Supreme Court recently implied in Microsoft Corp. v. Baker that a voluntary dismissal without prejudice is not final. In that case, a voluntary dismissal with prejudice was not final because the plaintiff retained the ability to bring the claims again and similar reasoning should apply in the case at hand.
WHETHER A VOLUNTARY DISMISSAL IS A PROCEEDING
Waetizig claims that the word “proceeding” under Rule 60(b) means any step in the litigation between the start of the suit and execution. Waetzig cites dictionary definitions and lower court rulings from the time Rule 60(b) was adopted to support that reading. Using that definition, Waetzig argues that a voluntary dismissal without prejudice is a proceeding because it is an action taken by the parties during litigation.
Waetzig maintains that that definition is better than the “narrower” one the Tenth Circuit mentioned, which only includes “applications to the court” or “method[s] of invoking action, the action of a court.” Waetzig claims that various tools of statutory interpretation advise against the Tenth Circuit’s definition. First, Waetzig argues that the canon against surplusage advises against the narrow definition because it would give “proceeding” the same meaning as “order,” making it redundant. Second, Waetzig asserts that other rules use “proceeding” antithetically to the narrower definition. For example, Waetzig posits that “proceeding” refers to party filings that do not require court intervention elsewhere in the rules. Third, Waetzig posits the noscitur a sociis doctrine supports a broader understanding of “proceeding” because, when read alongside judgement and order, it refers to an action that terminates the litigation.
Further, Waetzig notes that the Supreme Court has suggested, in dicta , that a voluntary dismissal without prejudice can be reopened under Rule 60(b) as a final proceeding. Additionally, Waetzig asserts multiple circuit courts and State supreme courts have treated a voluntary dismissal without prejudice as a final proceeding. With all that case law, Waetzig claims that “proceeding” is not ambiguous so the doctrine of ejusdem generis should not apply; it should only be used for uncertain general terms—such as “other”—at the end of a list. In any event, Waetzig maintains that even under the Tenth Circuit’s definition, a voluntary dismissal is a proceeding because it is a request to the court to induce action.
Conversely, Halliburton claims that a (final) proceeding means a step in the litigation process that determines the parties’ rights and obligations and that burdens a party. Halliburton asserts that a voluntary dismissal without prejudice is not a proceeding because it leaves the situation as if the case had never been filed, creating no rights or obligations, and not burdening the plaintiff. Halliburton contrasts a voluntary dismissal with prejudice , which “operates as an adjudication on the merits” and does burden parties.
Halliburton maintains that various canons of statutory interpretation support that definition. First, Halliburton disagrees with Waetzig that interpreting proceeding that way is superfluous, because proceeding does independent work in defining determinations of rights that do not qualify as judgements or orders, such as consent decrees . If anything, Halliburton claims, Waetzig’s definition is superfluous because judgments and orders would qualify as a proceeding. Second, Halliburton argues that the noscitur doctrine, which clarifies a word’s definition using neighboring words, counsels that a final proceeding must determine rights and obligations because that is also true of final judgements and orders. Additionally, Halliburton contends that “relieve” in Rule 60(b) signals that a proceeding must determine rights because otherwise there would be nothing for a Rule 60(b) motion to grant relief from.
Finally, Halliburton argues that Waetzig misconstrues the relevant judicial precedents that interpret the meaning of “proceeding.” Halliburton contends that federal courts could not reopen a voluntary dismissal before the adoption of Rule 60(b) and that nothing in the rule disturbed that tradition, even if some circuit courts disagree. Further, Halliburton asserts that “proceeding” operates as a backstop provision in Rule 60(b), giving parties an avenue for relief from final determinations of their rights that do not constitute a judgement or order. Halliburton argues that the ejusdem canon is an appropriate tool of statutory interpretation because proceeding is a general term at the end of a list. Halliburton claims that the ejusdem cannon instructs “proceeding” to be read considering the common attributes it shares with judgement and order. Because a final judgement or order determines the parties’ rights and obligations, Halliburton maintains that a final proceeding must also.
Discussion
FEDERAL COURTS’ ABILITY TO CORRECT MISTAKES AND FRAUD
Waetzig asserts that the Tenth Circuit’s interpretation of “final” would disrupt the application and intentions of the FRCP. Waetzig argues that a narrow reading of the word “final” would only capture a small subset of cases eligible for refiling. Waetzig contends that this would create a dangerous “twilight zone” of cases that can neither be supervised as interlocutory nor revisited as final under Rule 60(b). That twilight zone, Waetzig explains, places a third category of cases beyond the federal courts’ power. Waetzig warns that that category involves all cases that are dismissed because of fraud or mistake by an attorney or a defendant. Waetzig claims that district courts would lack jurisdiction to ameliorate those wrongs because there is no judicial determination as the Tenth Circuit requires.
Halliburton counters that plaintiffs will not be without remedy in cases of dismissal because of fraud, unless other circumstances, like the expiration of a statute of limitations, prevent plaintiffs from refiling. Halliburton argues that treating a dismissal as final for Rule 60(b) purposes, even when it’s not final for appeal, creates confusion. Halliburton maintains that this disconnect introduces unnecessary complexity in understanding the concept of finality in legal proceedings. Halliburton asserts that the FRCP were not intended to be an “all-purpose fix-it” tool for errors or mistakes in the litigation process. Halliburton argues that the appropriate redress for attorney negligence and misconduct is in state courts, rather than collateral actions in federal courts. Halliburton adds that the remedy for a defendant’s fraud also lies in state court. Federal courts, Halliburton contends, deliberately lack the jurisdiction to correct every “litigation-adjacent” error.
JUSTICE FOR PLAINTIFFS WHO MISTAKENLY DISMISS
Waetzig asserts that if a judicial determination is required for Rule 60(b) to apply to a dismissal, plaintiffs can only get relief when they seek a motion requesting the court’s signature. Waetzig claims that this creates a “trap for the unwary,” preventing relief to deserving parties. If a plaintiff cannot reassert their claims for some reason, Waetzig argues that their previous dismissal without prejudice in effect becomes a dismissal with prejudice, frustrating Rule 41’s goals. For example, a superseding judicial decision may preclude a plaintiff’s cause of action. Waetzig also posits that plaintiffs only seek Rule 60(b) relief when truly necessary. Waetzig explains that plaintiffs who cannot refile a new case depend on Rule 60(b) to obtain relief, whereas plaintiffs who can refile will likely do so to avoid the rigid requirements of Rule 60(b). Waetzig maintains that requiring a judicial determination will discourage parties from dismissing by notice or stipulation because that will waive Rule 60(b) relief. As a result, Waetzig asserts that such a requirement will squander judicial resources and prolong litigation.
On the other hand, Halliburton asserts, that Rule 60(b) is carefully crafted to balance the conflicting goals of finality and flexibility. Halliburton argues that Rule 41 permits plaintiffs to refile their cases as soon as the next day to get appropriate relief. Halliburton thus claims that plaintiffs rarely turn to Rule 60(b) to undo their own voluntary dismissal without prejudice. Halliburton explains that plaintiffs do not need Rule 60(b) unless a plaintiff erred in seeking a voluntary dismissal without prejudice. For example, if a plaintiff cannot refile their case because the statute of limitations has expired, the cause would be plaintiff’s decision to dismiss rather than stay the case. Halliburton claims courts should not use Rule 60(b) to protect plaintiffs from the effects of their own litigation decisions.
Conclusion
Authors
Written by: Garrett Taylor and Alexandra Fertig
Edited by: Gijs de Bra
Acknowledgments
The authors would like to thank Professor Alexandra Lahav for her insights into this case.
Additional Resources
- The Chamber of Commerce of the United States of America, Brief of Amicus Curiae , (December 26, 2024).