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Motion to compel settlement9/28/2023 In contrast, dismissal pursuant to Rule 41(a)(2) expressly requires the approval of the district court and is not effective unless and until the court takes appropriate action. A district court need not and may not take action after the stipulation becomes effective because the stipulation dismisses the case and divests the district court of jurisdiction. The crux of the Eleventh Circuit’s decision lies in the difference between a dismissal under Rule 41(a)(1) versus Rule 41(a)(2):Ī stipulation filed pursuant to Rule 41(a)(1) is self-executing and dismisses the case upon its filing unless it explicitly conditions its effectiveness on a subsequent occurrence. And no effective court order retaining jurisdiction had been entered in Shaz. The Eleventh Circuit emphasized that “jurisdiction cannot exist by mere consent of the parties.” Consent is required, but the district court must also issue an order specifically retaining jurisdiction to enforce a settlement agreement. Notwithstanding the parties’ stipulated agreement providing for retention of jurisdiction and the court’s subsequent entry of a consent final judgment pursuant to the settlement agreement (enjoining defendant Shaz), the Eleventh Circuit concluded that the district court lacked jurisdiction to consider the motion to enforce the settlement agreement. When the plaintiff breached the settlement agreement, the defendants filed a motion to compel enforcement. The stipulation simply asserted that “the Court shall reserve jurisdiction to enforce the settlement between the parties” – but it was not conditioned on the entry of an order retaining jurisdiction. In Shaz, the parties entered into a settlement agreement, and filed a stipulation for dismissal with prejudice. Shaz, LLC answers this question, at least for litigants within the Eleventh Circuit. Where did you go wrong?Īnago Franchising, Inc. When the opposing party breaches the settlement agreement, you promptly file a motion to compel enforcement – only to have your motion denied for lack of jurisdiction. The lawsuit is dismissed pursuant to the settlement agreement and Federal Rule of Civil Procedure 41(a)(1). Imagine this scenario: after years of litigation in federal court, your client reaches a settlement agreement with the opposing party.
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