George Reiter v. Honeywell, Inc. , 104 F.3d 1071 ( 1997 )

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Nos. 95-2859/2884
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George Reiter, *
*
Appellant/Cross-Appellee, *
* Appeals from the United States
v. * District Court for the District
* of Minnesota.
Honeywell, Inc.; Donna Neff; *
Dennis Madden; Thomas *
Wylie, *
*
Appellees/Cross-Appellants.*
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Submitted: June 10, 1996
Filed: January 16, 1997
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Before BEAM and HEANEY, Circuit Judges, and BOGUE,1 District Judge.
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BEAM, Circuit Judge.
In this employment discrimination case, George Reiter appeals from
the district court's order which adopted the report and recommendation of
the magistrate judge to whom the case was referred. Because we find that
the magistrate judge was without jurisdiction to conduct a jury trial in
this matter, we dismiss this appeal for lack of jurisdiction and remand to
the district court for further proceedings consistent with this opinion.
I. BACKGROUND
For purposes of this opinion, we need only outline the facts
underlying Reiter's employment dispute with Honeywell. After working at
Honeywell for more than thirty-five years, Reiter
1
The Honorable Andrew W. Bogue, United States District Judge
for the District of South Dakota, sitting by designation.
retired. He later brought suit against Honeywell and several of its
officials, alleging they violated Title VII, the Minnesota Human Rights Act
(MHRA), the Age Discrimination in Employment Act (ADEA) and committed
various state torts including tortious interference with contract,
defamation, and intentional infliction of emotional distress. Reiter
alleges that his retirement was less than voluntary and that, instead, he
was constructively discharged from his position because of his age and
gender.
The district court granted summary judgment for defendants on the
breach of contract, tortious interference with contract, and promissory
estoppel claims and referred the remaining matters to the magistrate judge
"as special master, for trial and recommended findings of fact and
conclusions of law." Reiter v. Honeywell, No. 4-93-CV-394, order at 1 (D.
Minn. Aug. 12, 1994). In its referral order, the district court cited Rule
53(b) of the Federal Rules of Civil Procedure and 28 U.S.C. § 636(b)(2).
Id. The parties did not consent to this referral or complete the consent
forms sent to them by the Clerk of Court at the commencement of the action.
Upon referral, the magistrate judge presided over a jury trial in
this action.2 The jury found for Reiter on all claims, finding malice on
the defamation claim and constructive discharge on the discrimination
claims. It awarded $315,000 in damages for age and sex discrimination,
$300,000 for damage to reputation and $150,000 for emotional distress. The
magistrate judge then recommended that the district court enter judgment
on the discrimination claims, order Reiter's reinstatement, grant Reiter
backpay with prejudgment interest, grant Reiter attorneys' fees and costs,
deny defendants' motion for a new trial, but grant judgment as a matter of
law on
2
Plaintiff had demanded a jury trial. Although not all of
plaintiff's claims were entitled to a jury trial, the magistrate
judge tried the entire case to a jury. As to those claims for
which no jury was required, the magistrate judge treated the jury's
verdict as advisory only.
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the defamation and emotional distress claims and grant a directed verdict
on the negligent retention and supervision claim.
Following a de novo review of the record, the district court adopted
the magistrate judge's report and recommendation. Reiter appeals,
requesting reinstatement of the jury's full award of damages. Defendants
cross-appeal the judgment for Reiter.
II. DISCUSSION
We must determine whether a magistrate judge's authority under 28
U.S.C. § 636(b)(2) is broad enough to encompass the jury trial conducted
here and, if not, whether the requirements of section 636(c), which
expressly authorize a magistrate judge to conduct trials, were satisfied.
We answer both questions in the negative.
The district court's referral of this matter to the magistrate judge
was purportedly under 28 U.S.C. § 636(b)(2).3 Because the parties did not
consent to that referral, the magistrate judge was bound by the strictures
of Rule 53(b)4 of the Federal Rules of
3
That section provides:
A judge may designate a magistrate to serve as a special
master pursuant to the applicable provisions of this
title and the Federal Rules of Civil Procedure for the
United States district courts. A judge may designate a
magistrate to serve as a special master in any civil
case, upon consent of the parties, without regard to the
provisions of rule 53(b) of the Federal Rules of Civil
Procedure for the United States district courts.
28 U.S.C. § 636(b)(2).
4
Rule 53(b) provides:
A reference to a master shall be the exception and not
the rule. In actions to be tried by a jury, a reference
shall be made only when the issues are complicated; in
actions to be tried without a jury, save in matters of
account and of difficult computation of damages, a
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Civil Procedure. That rule states that matters to be tried to a jury are
only to be referred to a special master if the issues are complicated and
that those matters to be tried without a jury are only to be referred to
a master upon a finding of "some exceptional condition" requiring such
referral. Although the district court made no such findings, it referred
both the jury and nonjury matters to the magistrate judge for trial. The
only reason given for the referral was that the case had been on the
district court docket for over a year. Therefore, the referral did not
comport with section 636(b)(2).
The remaining portions of section 636(b) also fail to offer statutory
authority for this referral. Section 636(b) allows a district judge to
refer specific matters to a magistrate judge including, but not limited to:
(1) certain pretrial matters, section 636(b)(1)(A), reviewed by the
district court for clear error; and (2) evidentiary hearings and proposed
findings of fact, section 636(b)(1)(B), reviewed by the district court de
novo. Under these subsections, consent of the parties is not required and,
as stated above, the matters referred are subject to reconsideration by the
district court. Section 636(b) does not, however, authorize the magistrate
judge to conduct jury trials. As the Eleventh Circuit stated in Hall v.
Sharpe, trial by jury under (b)(1) would create a "paradox"--if the
district court fails to conduct a de novo review of the jury verdict, it
would not comply with the statute; if the district court conducts a de novo
review of the jury verdict, it reduces the jury to an advisory role in
violation of the Seventh Amendment. 812 F.2d 644, 648 (11th Cir.
reference shall be made only upon a showing that some exceptional
condition requires it. Upon the consent of the parties, a
magistrate judge may be designated to serve as a special master
without regard to the provisions of this subdivision.
Fed. R. Civ. P. 53(b).
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1987). See also In re Wickline, 796 F.2d 1055, 1057 (8th Cir. 1986).
In contrast to section 636(b), section 636(c) does authorize
magistrate judges to conduct civil jury and nonjury trials. See Lehman
Bros. Kuhn Loeb, Inc. v. Clark Oil & Ref. Corp., 739 F.2d 1313 (8th Cir.
1984) (en banc) (upholding constitutionality of section 636(c)).
Subsection (c) provides, in relevant part:
Upon the consent of the parties, a full-time United States
magistrate or a part-time United States magistrate who serves
as a full-time judicial officer may conduct any or all
proceedings in a jury or nonjury civil matter and order the
entry of judgment in the case, when specially designated to
exercise such jurisdiction by the district court or courts he
serves.
28 U.S.C. § 636(c)(1). However, as the statute makes clear, the reference
of trials is contingent upon the parties' consent. See, e.g., Adams v.
Heckler, 794 F.2d 303, 307 (7th Cir. 1986); Lehman Bros., 739 F.2d at 1315;
Alaniz v. California Processors, Inc., 690 F.2d 717, 720 (9th Cir. 1982).
By expressing their consent to a referral, parties waive their right to
have their case tried before an Article III judge. Lehman Bros., 739 F.2d
at 1315. As stated above, the parties did not consent to the referral of
this trial to the magistrate judge.
Reiter argues that defendants' failure to lodge an objection to the
referral should operate as a waiver of section 636(c)'s consent
requirement. In support of this contention, Reiter relies primarily on
four cases which are either distinguishable or not binding on this court.
In Peretz v. United States, the parties expressly consented to the
magistrate judge's conducting of the voir dire, the action about which they
later complained. 501 U.S.
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923, 925 n.2 (1991). The remaining cases are from the Fifth Circuit Court
of Appeals and are not binding on this court.5
As our cases make clear, "[s]ection 636(c) requires a clear and
unambiguous statement in the record of the affected parties' consent to the
magistrate judge's jurisdiction." J.C. Henry v. Tri-Services, Inc., 33
F.3d 931, 933 (8th Cir. 1994) (citing Gleason v. Secretary of Health and
Human Servs., 777 F.2d 1324 (8th Cir. 1985)). On this record, the parties
did not consent to proceed in front of the magistrate judge. A purported
section 636(b) referral may not act as a section 636(c) referral and bypass
the consent requirement of that section. In re Wickline, 796 F.2d at 1058
(stating "[s]ince [the consent] safeguard is not present in a reference
under section (b), to allow a jury trial absent consent under [that
section] is clearly inconsistent with the spirit and
5
The Fifth Circuit has held that an improper referral is a
procedural error, not a jurisdictional one, where the district
court and not the magistrate judge entered the final order. See,
e.g., Equal Employment Opportunity Comm'n v. West Louisiana Health
Servs., Inc., 959 F.2d 1277, 1282 (5th Cir. 1992) (citing Sockwell
v. Phelps, 906 F.2d 1096, 1098 (5th Cir. 1990)). That court's
reasoning emphasizes the importance of the district court's
supervision of the magistrate judge's actions. According to the
Fifth Circuit, the rendering of final judgment by the district
court essentially cures any procedural irregularities in the
referral. With due respect to our sister circuit, we disagree with
such reasoning.
As the facts of this case show, the district court's entry of
a final order does not cure the improper referral to the magistrate
judge. Cases upholding the constitutionality of section 636
emphasize the presence of two safeguards: (1) supervision and
control by the district court under subsection (b); and (2) consent
of the parties to proceed in front of a non-Article III judge under
subsection (c). See, e.g., In re Wickline, 796 F.2d at 1058;
Lehman Bros., 739 F.2d at 1315. In this case, there was no consent
for a trial under subsection (c). Additionally, the district
court's review of the jury's verdict creates Seventh Amendment
problems in addition to the Article III concerns already expressed.
See generally Hall, 812 F.2d at 648. For these reasons, we decline
to follow the Fifth Circuit's reasoning.
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intent of section (c)"). See also Loewen-America, Inc. v. Advance
Distribut. Co., 673 F.2d 219, 220 (8th Cir. 1982).
Furthermore, the requirement of consent is fundamental to section
636(c)'s constitutionality. See, e.g., Gomez v. United States, 490 U.S.
858, 870 (1989); Lehman Bros., 739 F.2d at 1315. Without that consent, the
parties cannot be deemed to have given up their right to proceed in front
of an Article III judge. We will not lightly find a waiver of that
consent. As the Eleventh Circuit has stated:
[T]he waiver approach does violence to Congress' specification
in § (c) that trial before a magistrate must be predicated upon
express consent. That the parties proceeded to trial neither
fulfilled nor removed the requirements of § (c), nor invested
a non-Article III officer with authority in excess of that
provided by law.
Hall, 812 F.2d at 649. On these facts, we find that the parties did not
consent to a jury trial in front of the magistrate judge.
Reiter next argues that even if the jury matters were improperly
referred to the magistrate judge, the nonjury matters were properly
referred there. In so arguing, Reiter implies that the improper referral
of an action implicating a litigant's right to a jury trial is more
problematic than the improper referral of a nonjury action. See generally
In re Wickline, 796 F.2d at 1058. Although we acknowledge that only some
of Reiter's claims were entitled to a jury trial, we need not reach this
argument. On these facts, the issues referred to the magistrate judge were
so intertwined as to prevent this court from sifting through the actions
and separating those properly referred, if any, from those improperly
referred.6
6
For instance, under Reiter's proposed partial affirmance of
the referrals, he would have us affirm the jury's finding of
constructive discharge on the MHRA claim, a nonjury discrimination
claim. He would then presumably render it binding on the ADEA
allegation, a jury claim, in later proceedings.
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Our holding today is in no way meant to condone defendants' actions.
Defendants only complained of the referral after the jury rendered a hefty
verdict against them. This "wait and see" procedure is contrary to
judicial efficiency. However, the language of the referral statute is
clear. The parties must consent to the referral of a trial to a magistrate
judge. Because the parties did not consent to the referral in this case,
we find that the magistrate judge was without jurisdiction to conduct the
trial.
III. CONCLUSION
Because the district court improperly referred this matter to the
magistrate judge, we dismiss this appeal for lack of jurisdiction and
remand this matter to the district court for further proceedings consistent
with this opinion.
A true copy.
Attest:
CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.
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