PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
C. L. RITTER LUMBER COMPANY,
INCORPORATED; COAL MOUNTAIN
TRUST; HURT-MCGUIRE LAND TRUST;
JAMES M. MCGUIRE LAND TRUST;
HUGH MACRAE LAND TRUST;
BUCKHORN COAL COMPANY;
BUCHANAN COAL COMPANY; SAYERS
POCAHONTAS COAL COMPANY; YUKON
POCAHONTAS COMPANY; GEORGIA
PACIFIC CORPORATION; GARRET K.
FRANKS; LINDA SCHRACK,
Administrator of the estate of
Nermal S. Whited; SUE SNYDER,
Administrator of the estate of No. 01-1286
Nermal S. Whited; MARY RUSSELL,
Administrator of the estate of Ruth
F. Officer; HARVEY H. FRANKS;
VERNELL FRANKS; J. C. FRANKS;
TRULA S. FRANKS; JOHN FRANKS,
Administrator of the estate of Estil
E. Franks; DOROTHY CASTEEL;
WANDA L. ROSE; STUART ROSE;
MONA WICKS; FREDA MEISTER; JERRY
MEISTER; EARL MAY; JANIE MAY;
CLELL METCALF; CHARLES R.
ARTHUR; T. J. BONDURANT;
2 RITTER LUMBER v. CONSOLIDATION COAL
MARGARET BONDURANT; INTERMONT
LAND COMPANY; ANN DOBRENZ,
Special Administrator of the estate
of Lillian Metcalf; KELLY WRIGHT,
JR., Executor of the estates of Kelly
Wright, deceased and Evelyn
Wright, deceased,
Plaintiffs-Appellees,
and
LEVISA COAL COMPANY,
Plaintiff,
v.
CONSOLIDATION COAL COMPANY;
CONOCO, INCORPORATED; POCAHONTAS
GAS PARTNERSHIP; APPALACHIAN
METHANE, INCORPORATED;
APPALACHIAN OPERATORS,
INCORPORATED; BUCHANAN
PRODUCTION COMPANY,
Defendants-Appellants.
RITTER LUMBER v. CONSOLIDATION COAL 3
LEVISA COAL COMPANY; HELEN C.
JOHNSON; CAROL COMBS IRVIN;
FREDERICK H. COMBS, II, Trustee for
the Marion S. Combs Trust;
MARTHA E. COMBS; VIRGINIA LEE
LINWICK; CARL J. PUCKETT, Trustee
for the W. Kent Pobst Trust;
MEREDITH E. IQBAL; PHILLIP G.
LINWICK; ELENE M. COMBS,
Plaintiffs-Appellees,
v.
APPALACHIAN METHANE, No. 01-1287
INCORPORATED; APPALACHIAN
OPERATORS, INCORPORATED;
BUCHANAN PRODUCTION COMPANY,
Defendants-Appellants,
and
CARDINAL STATES GATHERING
COMPANY; MCNIC OAKWOOD
GATHERING, INCORPORATED; MCNIC
CSG PIPELINE COMPANY; CONSOL
INC.; ISLAND CREEK COAL COMPANY,
Defendants.
Appeals from the United States District Court
for the Western District of Virginia, at Abingdon.
Samuel G. Wilson, Chief District Judge.
(CA-97-117-1, CA-01-00009-1)
Argued: October 31, 2001
Decided: March 8, 2002
Before WILKINS, NIEMEYER, and LUTTIG, Circuit Judges.
4 RITTER LUMBER v. CONSOLIDATION COAL
Affirmed by published opinion. Judge Wilkins wrote the opinion, in
which Judge Niemeyer and Judge Luttig joined.
COUNSEL
ARGUED: David Wayne Hardymon, VORYS, SATER, SEYMOUR
& PEASE, L.L.P., Columbus, Ohio, for Appellants. William R.
Rakes, Jeffrey Scott Sexton, GENTRY, LOCKE, RAKES &
MOORE, Roanoke, Virginia, for Appellees. ON BRIEF: Monica L.
Taylor, GENTRY, LOCKE, RAKES & MOORE, Roanoke, Virginia,
for Appellees.
OPINION
WILKINS, Circuit Judge:
These consolidated appeals arise from judgments in favor of sev-
eral coalbed owners (collectively, "Plaintiffs") in an action against
multiple energy companies (collectively, "Defendants"). The Defen-
dants contend that the district court lacked jurisdiction to enter these
judgments. We affirm.
I.
The Defendants leased coalbeds from the Plaintiffs in order to
extract and sell methane gas found in the coal seams. In all, there
were 12 leases ("Disputed Leases"). The terms of these leases
required the Defendants to pay royalties to the Plaintiffs based on the
value of the gas collected from the coalbeds, minus specified deduc-
tions. The Plaintiffs contend that the Defendants took excessive
deductions and thus underpaid royalties. As a result, the Plaintiffs
filed this lawsuit, joining 12 counts—one for each lease—in a single
complaint. Federal jurisdiction over this suit was based on diversity
of citizenship. See 28 U.S.C.A. § 1332 (West 1993 & Supp. 2001).
A jury found in favor of the Plaintiffs on all 12 counts. The Defen-
dants then moved pursuant to Federal Rules of Civil Procedure 50(b)
RITTER LUMBER v. CONSOLIDATION COAL 5
and 59(a) for judgment as a matter of law or, in the alternative, a new
trial. Later, they submitted a second post-trial motion asserting that
the trial judge had a conflict of interest. The trial judge agreed with
the latter assertion and recused himself from all further involvement
in the case. With one exception not relevant here, the district court
(acting through a different judge) denied the Defendants’ remaining
post-verdict challenges and entered judgment in favor of the Plain-
tiffs.
After judgment was entered, the Defendants moved to dismiss this
suit for lack of complete diversity between the Plaintiffs and Defen-
dants.1 See Fed. R. Civ. P. 60(b)(4). Specifically, the Defendants
alleged that three Plaintiffs—John Irvin, Carol Combs Irvin, and
Levisa Coal Company (collectively, "Texas Plaintiffs")—and two
Defendants—Conoco, Inc. and Pocahontas Gas Partnership (collec-
tively, "Texas Defendants")—were Texas residents for diversity pur-
poses. The Plaintiffs moved to amend the judgment by splitting this
suit into two separate cases, with one embracing the claims asserted
by the Texas Plaintiffs and the other embracing the claims against the
Texas Defendants. (This was possible because none of the Texas
Plaintiffs asserted claims against any of the Texas Defendants.) The
district court agreed that this measure would alleviate any jurisdic-
tional concern and therefore vacated the existing judgment, divided
the lawsuit into two cases, and entered judgment in favor of the Plain-
tiffs in each of the cases. The Defendants noted an appeal in each
case.
II.
The Defendants’ primary claim is that the district court erred in
refusing to dismiss this suit for lack of jurisdiction. We hold that the
court had the power to choose an alternative remedy for the jurisdic-
tional defect and that it did not abuse its discretion in doing so.
1
At oral argument, the Defendants’ attorney suggested that the Defen-
dants may have been aware of this jurisdictional problem at the begin-
ning of this litigation. If Defendants’ counsel shared this knowledge, then
they engaged in unacceptable gamesmanship by waiting until after judg-
ment to raise this issue.
6 RITTER LUMBER v. CONSOLIDATION COAL
It is undisputed at this stage of the proceedings that some Plaintiffs
and some Defendants were Texas residents and that the district court
therefore could not exercise diversity jurisdiction over the case as it
was originally pled.2 See Wis. Dep’t of Corr. v. Schacht, 524 U.S.
381, 388 (1998). On the other hand, if the Plaintiffs had filed separate
complaints ab initio, there would have been no jurisdictional obstacle
to joining the cases for trial. See Cella v. Togum Constructeur Ensem-
leier en Industrie Alimentaire, 173 F.3d 909, 913 (3d Cir. 1999) (stat-
ing that, to determine whether complete diversity exists, courts must
examine consolidated cases separately); cf. Intown Props. Mgmt., Inc.
v. Wheaton Van Lines, Inc., ___ F.3d ___, 2001 WL 1337547, at *2
(4th Cir. Oct. 31, 2001) (observing that consolidation of proceedings
does not merge separate cases into a single unit or make the parties
in one case parties in the other). The amendment of the judgment by
the district court had the effect of retroactively creating the latter situ-
ation (that is, two separate cases properly joined for trial). Such post-
trial reorganizations are specifically authorized by the Federal Rules
of Civil Procedure. See Fed. R. Civ. P. 21 (stating that court may cure
misjoinder of parties "at any stage of the action").
The Defendants assert that the amendment of the judgment was
nevertheless improper because the absence of jurisdiction deprived
the district court of the power to enter any order other than dismissal.
This is incorrect, in light of precedents upholding efforts to rescue
jurisdiction by, for example, dismissing non-diverse parties. See, e.g.,
Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S. 826, 833-35
(1989). Furthermore, the Defendants’ attempts to distinguish such
precedents are unavailing. According to the Defendants, the amend-
ment of the judgment was improper because the original judgment
was reached through trial rather than summary judgment. So far as we
can discern, the gist of the Defendants’ argument is that, while both
summary judgment decisions and trial verdicts are nullities when the
2
There is precedent suggesting that jurisdiction was proper even as the
case was originally pled. See Harris v. Ill.-Cal. Express, Inc., 687 F.2d
1361, 1368-69 (10th Cir. 1982) (upholding jurisdiction in case involving
two discrete claims because parties to each claim were diverse, even
though there was not complete diversity between all plaintiffs and all
defendants). This theory has not been asserted, however, and we there-
fore do not consider it.
RITTER LUMBER v. CONSOLIDATION COAL 7
court lacks jurisdiction, measures that resuscitate jurisdiction will
retroactively validate earlier legal rulings but not jury determinations.
The rationale for this distinction eludes us. When a court acts without
jurisdiction, the extent of the transgression is the same whether the act
involves ruling on a legal question, presiding over an evidentiary
hearing, or receiving a verdict from a jury. Cf. Steel Co. v. Citizens
for a Better Env’t, 523 U.S. 83, 94-95 (1998) (holding that it is
improper to address any non-jurisdictional question before jurisdic-
tion is ascertained). The defect is the same in any of these situations,
and so is the propriety of rescuing jurisdiction.
The Defendants next contend that cases like Newman-Green, in
which the judgment was amended by the mere dismissal of a party,
cannot support the more extensive remedy employed here. We dis-
agree. Here, as in Newman-Green, the remedy applied by the court
was authorized by the Federal Rules of Civil Procedure. And here, as
in Newman-Green, this remedy resulted in a trial unit over which the
court could validly exercise jurisdiction. The specific nature of the
remedy implicates the discretion of the court, not its power to act. See
Koehler v. Dodwell, 152 F.3d 304, 309 (4th Cir. 1998).
Moreover, we do not hesitate to uphold the exercise of discretion
here. In general, the equities favor upholding a judgment already
entered. See Caterpillar Inc. v. Lewis, 519 U.S. 61, 75 (1996) ("Once
a diversity case has been tried in federal court, . . . considerations of
finality, efficiency, and economy become overwhelming."). More-
over, while the Defendants contend that allowing this case to proceed
despite the absence of complete diversity was prejudicial because it
was difficult to keep the parties straight (particularly Defendants Con-
oco, Consol, and Consolidation Coal), this concern is entirely distinct
from the diversity question. The potential for confusion among parties
with similar names exists regardless of where the parties are domi-
ciled, and the remedy—irrespective of jurisdictional issues—is sever-
ance pursuant to Fed. R. Civ. P. 42(b), a remedy the Defendants never
requested. Moreover, the district court found no prejudice, and that
court was in a better position to make this determination, see
Newman-Green, 490 U.S. at 838. We therefore hold that the district
court did not abuse its discretion in granting the Plaintiffs’ motion to
amend the judgment.
8 RITTER LUMBER v. CONSOLIDATION COAL
III.
For the foregoing reasons, we affirm the decision of the district
court to amend the judgment instead of dismissing this suit for lack
of complete diversity. We have also considered the Defendants’ other
challenges to the judgment of the district court; having reviewed the
briefs and the applicable law, and having had the benefit of oral argu-
ment, we hold that these claims are without merit. Accordingly, the
judgment of the district court is affirmed.
AFFIRMED