Curtiss-Wright Corp. v. General Electric Co.
446 U.S. 1 (1980)
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Rule of Law:
A district court's decision to certify a final judgment on a single claim in a multi-claim action under Federal Rule of Civil Procedure 54(b) is reviewed for abuse of discretion and should be given substantial deference. The mere presence of non-frivolous counterclaims does not, by itself, create a just reason for delay or preclude certification.
Facts:
- Between 1968 and 1972, Curtiss-Wright Corp. entered into 21 contracts with General Electric Co. to manufacture components for nuclear-powered naval vessels.
- A dispute arose, and Curtiss-Wright asserted that General Electric owed an undisputed outstanding balance of $19 million for work already performed.
- The only disagreement regarding the $19 million debt concerned the interpretation of a contractual release clause; the amount of the debt itself was not in contest.
- In response to Curtiss-Wright's lawsuit, General Electric filed counterclaims seeking approximately $54 million for alleged extra costs and unjust enrichment.
Procedural Posture:
- Curtiss-Wright Corp. filed a diversity action against General Electric Co. in the U.S. District Court for the District of New Jersey.
- The District Court granted summary judgment for Curtiss-Wright on its claim for a $19 million balance due.
- The District Court then granted Curtiss-Wright's motion to certify the summary judgment as a final judgment under Federal Rule of Civil Procedure 54(b), expressly finding 'no just reason for delay.'
- General Electric, as appellant, appealed the certification to the U.S. Court of Appeals for the Third Circuit.
- A divided panel of the Court of Appeals held the District Court abused its discretion, dismissed the case for want of an appealable order, and directed the trial court to vacate the certification.
- The U.S. Supreme Court granted certiorari to review the decision of the Court of Appeals.
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Issue:
Does a district court abuse its discretion under Federal Rule of Civil Procedure 54(b) by certifying a final judgment on a single claim as immediately appealable when non-frivolous counterclaims remain, based on its weighing of judicial administrative interests and the equities between the parties?
Opinions:
Majority - Chief Justice Burger
No. A district court does not abuse its discretion under Federal Rule of Civil Procedure 54(b) by certifying a final judgment on a single claim when non-frivolous counterclaims remain, provided its decision is a reasonable assessment of judicial administrative interests and the equities involved. The proper standard of review on appeal is abuse of discretion, and the district court's judgment is entitled to substantial deference because it is the most familiar with the case. The Court of Appeals erred by applying a rigid rule requiring 'unusual or harsh circumstances' to justify certification in the presence of counterclaims. The district court is to act as a 'dispatcher,' and here it properly considered factors such as the separability of the claims, the avoidance of duplicative appellate review, and the economic impact of delay on the prevailing party, such as the differential between statutory and market interest rates on a large, liquidated sum.
Analysis:
This decision clarifies the standard for granting and reviewing Rule 54(b) certifications, rejecting rigid legal tests in favor of a flexible, discretionary approach centered on the trial judge's sound judgment. By emphasizing substantial deference to the district court, the Supreme Court empowers trial judges as case managers, allowing them to promote judicial efficiency and fairness without being constrained by categorical rules. This approach preserves the federal policy against piecemeal appeals but provides a practical mechanism to avoid injustice when one part of a complex case is fully resolved and delaying its finality would be inequitable.
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