No Rule 54(b) Appeal Without Finality: Zivkovic v. Laura Christy LLC Clarifies Limits on Conditional Dismissals

Introduction

Zivkovic v. Laura Christy LLC is a Second Circuit decision (Docket No. 22-1558, decided May 15, 2025) that addresses the interplay between federal appellate jurisdiction (28 U.S.C. § 1291), Federal Rule of Civil Procedure 54(b), and overlapping wage-and-hour claims under the federal Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL). Pavle Zivkovic and a class of “tipped” restaurant employees sued Laura Christy LLC (Valbella), Laura Christy Midtown LLC, and individual restaurant owners, alleging unpaid minimum wages and overtime under both federal and state law, among other causes of action. After a jury trial limited to the NYLL claims, the district court entered a judgment in favor of the plaintiffs, certified a partial Rule 54(b) final judgment on those state‐law claims, and left FLSA claims “conditionally dismissed” but subject to reinstatement if the NYLL judgment were reversed. Defendants appealed; the Second Circuit dismissed for lack of jurisdiction, holding that the conditional dismissal of FLSA claims deprived the decision of the finality required under § 1291 and that piecemeal appeal was disfavored under Rule 54(b).

Summary of the Judgment

The Second Circuit unanimously dismissed the appeal for lack of appellate jurisdiction. The court held:

The district court’s partial Rule 54(b) certification of the NYLL claims was inappropriate because plaintiffs had reserved the right to reinstate their overlapping FLSA claims if they lost on appeal.
Under 28 U.S.C. § 1291, a final decision ends the litigation on the merits and leaves nothing for the district court to do but execute the judgment. A conditional dismissal without prejudice—and the right to revive—fails to meet that finality requirement.
Federal policy disfavors piecemeal appeals. A true Rule 54(b) certification requires that certified claims be “separable” and pose no risk of duplicative review; here, overlapping FLSA and NYLL claims would necessarily implicate the same facts and potentially similar legal issues in successive appeals.
The appeal was dismissed because neither the § 1291 final‐decision rule nor Rule 54(b)’s no-just‐reason‐for‐delay standard was satisfied.

Analysis

1. Precedents Cited

28 U.S.C. § 1291 – Grants courts of appeals jurisdiction over “final decisions” of district courts. The Circuit emphasized that a “decision . . . ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.” (Coopers & Lybrand v. Livesay, 437 U.S. 463 (1978)).
Fed. R. Civ. P. 54(b) – Allows certification of a final judgment on some—but fewer than all—claims “only if the court expressly determines that there is no just reason for delay.” The court drew heavily on Curtiss-Wright Corp. v. General Electric Co., 446 U.S. 1 (1980), which requires “sound judicial administration” and warns against routine certifications that would encourage piecemeal appeals.
Curtiss-Wright – Identified two key tests for Rule 54(b): (1) claims must be “separable” so that no appellate court would have to decide the same issues more than once; (2) the district court must explicitly find “no just reason for delay,” weighing both judicial administrative interests and fairness to the litigants.
Purdy v. Zeldes, 337 F.3d 253 (2d Cir. 2003) – Permitted an immediate appeal where a plaintiff dismissed his remaining third claim “with prejudice” subject to revival only if the appellate court reversed the dismissal of two other claims, because the plaintiff risked losing the third claim if unsuccessful on appeal.
Scottsdale Insurance Co. v. McGrath, 88 F.4th 369 (2d Cir. 2023) – Distinguished Purdy; held that a conditional dismissal “without prejudice” allowing revival of claims if an appeal failed is not a “final decision” under § 1291.
Microsoft Corp. v. Baker, 582 U.S. 23 (2017) – Disapproved the tactic of voluntary dismissal to secure interlocutory review, holding that such dismissals would “undermine § 1291’s firm finality principle.”
Curtiss-Wright and Sears, Roebuck & Co. v. Mackey, 351 U.S. 427 (1956) – Established the historic federal policy against piecemeal appeals.

2. Legal Reasoning

The Second Circuit’s reasoning unfolds in two main lines:

a. Finality Under Section 1291

The court reaffirmed that § 1291 demands a final decision: litigation must be concluded on all claims or rights so that the district court’s only task is to execute the judgment. A conditional dismissal, leaving open the possibility of reinstatement based on the outcome of an appeal, means the district court retains a live matter—namely, the potential revival of FLSA claims—and thus no § 1291 finality exists.

b. Piecemeal Appeal and Rule 54(b)

Federal policy disfavors fragmenting appeals. Curtiss-Wright requires that certified claims be factually and legally separable from the remaining claims, ensuring no risk of duplicative appellate review. Here, the NYLL and FLSA claims arise from identical factual predicates (hours worked, tip credits, wage computations) and share similar defenses, so successive review in two appeals would likely revisit the same core issues.

Moreover, the district court’s Rule 54(b) analysis compared only the NYLL class claims to Zivkovic’s individual discrimination claims, but omitted any comparison to the FLSA claims that remained subject to reinstatement. This truncated inquiry failed to demonstrate that appellate panels would avoid duplicative review, so it was an abuse of discretion.

3. Impact

Zivkovic v. Laura Christy LLC reinforces the rigorous finality requirements for appeals under § 1291 and the discretionary but constrained use of Rule 54(b). The decision:

Closes the loophole of “conditional dismissals” permitting appeals while preserving revival rights on related claims.
Warns district courts to conduct a full Curtiss-Wright test, including a comparison of all adjudicated and remaining claims, before certifying partial final judgments.
Provides guidance for litigants in wage-and-hour class actions about the perils of bifurcating federal and state labor‐law claims for trial and appeal.
Strengthens the federal policy against piecemeal litigation, ensuring that overlapping claims under FLSA and state statutes are adjudicated together or not dissected into incremental appeals.

Complex Concepts Simplified

FLSA vs. NYLL: Both federal (FLSA) and New York state law (NYLL) require minimum wages and overtime pay, but NYLL often provides higher rates and fee-shifting to employees. Claims under both statutes typically arise from the same facts (e.g., hours worked, tip offsets).
28 U.S.C. § 1291 (“Final Decision”): Appeals courts can hear only “final decisions.” A decision is final if it disposes of all claims on the merits, leaving nothing for the district court except to enforce the ruling.
Fed. R. Civ. P. 54(b): When a case has multiple claims, the district court may certify a final judgment on some claims if (a) those claims are “separable” from the rest, and (b) the court expressly finds “no just reason for delay.” This avoids unnecessary delay in appeals but must respect the policy against piecemeal review.
Mootness vs. Finality: A claim is “moot” if the parties no longer have a live controversy. But a conditional dismissal without prejudice does not moot a claim—it simply shelves it, allowing revival—so there is no finality.

Conclusion

Zivkovic v. Laura Christy LLC emphasizes that an appealable final judgment under 28 U.S.C. § 1291 cannot rest on a conditional or reversible disposition of overlapping claims. A Rule 54(b) certification requires more than segregating some claims from others; it demands complete adjudication of the certified claims and a thorough Curtiss-Wright analysis showing no risk of duplicative appellate review. By dismissing the appeal for lack of jurisdiction, the Second Circuit reaffirmed the federal policy against piecemeal appeals and closed off strategies that would allow litigants to split their claims into incremental appeals while keeping others alive. This decision will guide counsel and courts in structuring wage-and-hour litigations and appeals to ensure that all related claims are either fully resolved or not prematurely appealed.