Limits of Appellate Jurisdiction over Settlement Enforcement: Non-Appealability of Orders Enforcing Class Action Releases

1. Introduction

In In re Credit Default Swaps Antitrust Litigation, 24-635-cv (2d Cir. May 20, 2025), the Second Circuit clarified when its jurisdiction is triggered—or withheld—by orders that enforce class action settlement releases. The appeal arose from a District of New York order enjoining certain pension‐fund plaintiffs (the “Funds”) from pursuing auction‐rigging claims in a separate New Mexico suit. The plaintiffs had opted into a 2016 nationwide class settlement against major banks accused of anticompetitive conduct in the credit default swap (CDS) market, and later tried to sue the same banks for related auction‐rigging practices. The district court enforced the broad release in the 2016 settlement, and the Funds appealed. The Second Circuit dismissed for lack of appellate jurisdiction.

2. Summary of the Judgment

• The 2016 class settlement in the Southern District of New York released any “claims, known or unknown” based on pre-June 30, 2014 conduct “arising out of or relating to any CDS Transaction.”
• The Funds remained class members and did not opt out; they shared in a $1.864 billion recovery.
• In 2021 the Funds sued in New Mexico for auction-price manipulation. The banks moved in New York to enforce the 2016 release, and the district court enjoined the Funds from pursuing any pre-June 30, 2014 claims.
• On appeal, the Second Circuit held the order was neither a “final decision” under 28 U.S.C. § 1291 nor an appealable interlocutory injunction under § 1292(a)(1), and therefore dismissed the appeal for lack of jurisdiction.

3. Analysis

3.1 Precedents Cited

• In re Tronox Inc., 855 F.3d 84 (2d Cir. 2017): Held that mere enforcement or interpretation of an existing injunction is not a “final decision” under § 1291 unless accompanied by contempt findings or sanctions.
• Wilder v. Bernstein, 49 F.3d 69 (2d Cir. 1995): Confirmed that an injunction without contempt adjudication is not final for § 1291 purposes.
• Wal-Mart Stores, Inc. v. Visa U.S.A., Inc., 396 F.3d 96 (2d Cir. 2005): Defined appealable interlocutory relief under § 1292(a)(1) narrowly to orders “granting, continuing, modifying, refusing or dissolving injunctions.”
• Uniformed Fire Officers Ass’n v. de Blasio, 973 F.3d 41 (2d Cir. 2020): Summarized jurisdictional prerequisites for appeals of injunctions.

3.2 Legal Reasoning

The panel’s reasoning unfolded in two steps:

1. No Final Decision under § 1291. Section 1291 authorizes appeals only from “final decisions” of district courts. An order that simply interprets or enforces an existing injunction—without contempt findings or sanctions—does not qualify. The court applied Tronox and Wilder and concluded the 2024 enforcement order was not final.
2. No Appealable Interlocutory Injunction under § 1292(a)(1). Section 1292(a)(1) covers only orders that “grant, continue, modify, refuse or dissolve injunctions.” Here, the 2024 order did not create new injunctive relief or expand the release beyond its original terms; it merely enforced the permanent injunction entered in 2016. The court likewise rejected the Funds’ argument that it had “modified” the old injunction via misapplication of the identical‐factual‐predicate or adequate‐representation doctrines.

3.3 Impact

• For plaintiffs and defense counsel, the decision clarifies that enforcement orders of class‐action settlement releases are generally not appealable unless the district court imposes sanctions or issues a new, substantive injunction.
• Future litigants must recognize that challenges to scope or application of a preexisting settlement release are likely to be heard only in the district court unless an exception to finality or interlocutory appealability applies.
• Settlement negotiations may now factor in that enforcement disputes are deferred to post-settlement proceedings, limiting appellate oversight.

4. Complex Concepts Simplified

• Final Decision (28 U.S.C. § 1291): A ruling that concludes the litigation on the merits or a separable branch thereof, leaving nothing for the court to do but execute the judgment.
• Interlocutory Appeal Under § 1292(a)(1): A narrow exception allowing appeals from certain non-final orders concerning injunctions, but only when the order itself grants or changes injunctive relief.
• Identical Factual Predicate Doctrine: In class settlement releases, unpled claims sharing the same integral facts as settled claims may also be released.
• Adequate Representation Doctrine: Due-process requires that class members whose claims are released were adequately represented, which is established by aligned interests, not by the vigor of pursuit.

5. Conclusion

The Second Circuit’s summary order in In re Credit Default Swaps Antitrust Litigation reinforces the principle that appeals from enforcement of class action settlement releases are unavailable unless the district court issues a new or expanded injunction or attaches contempt sanctions. By applying established precedent—Tronox, Wilder, and Wal-Mart—the court reaffirmed the narrow scope of appellate jurisdiction under 28 U.S.C. §§ 1291 and 1292(a)(1). This ruling underscores the need for litigants to resolve settlement‐enforcement disputes at the district‐court level and highlights the finality of broad class‐wide releases when class members fail to opt out.