Cycle Chem, Inc.; Clean Venture, Inc. v. Lisa P. Jackson Commissioner, New Jersey Department of Environmental Protection

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 09-1320
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CYCLE CHEM, INC.;
CLEAN VENTURE, INC.,
Appellants
v.
LISA P. JACKSON
COMMISSIONER, NEW JERSEY DEPARTMENT
OF ENVIRONMENTAL PROTECTION;
BRADLEY M. CAMPBELL
_____________
Appeal from the United States District Court
for the District of New Jersey
(D.C. Civil No. 2-07-cv-05575)
District Judge: Honorable Stanley R. Chesler
_____________
Argued November 9, 2011
Before: RENDELL, JORDAN and GREENAWAY, JR., Circuit Judges
(Opinion Filed: February 14, 2012)
_____________
James M. Hazen, Esq. [ARGUED]
331 Newman Springs Road
Suite 143, Building I
Red Bank, NJ 07701
Counsel for Appellants

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Jon C. Martin, Esq. [ARGUED]
Office of Attorney General of New Jersey
Division of Law
Richard J. Hughes Justice Complex
P.O. Box 093
Trenton, NJ 08625
Counsel for Appellees
Matthew H. Duncan, Esq. [ARGUED]
Fine, Kaplan & Black
1835 Market Street, Suite 2800
Philadelphia, PA 19103
Counsel for Court Appointed Amicus Curiae
_____________
OPINION OF THE COURT
_____________
RENDELL, Circuit Judge.
Plaintiff-Appellants Cycle Chem, Inc. and Clean Venture, Inc. (collectively,
“Cycle Chem”) appeal an order of the United States District Court for the District of New
Jersey denying their motion for reconsideration of the District Court’s prior order
granting the Defendant’s motion to dismiss. For the following reasons, we will affirm.
I. Background
Cycle Chem is in the business of generating, transporting and storing hazardous
waste in the state of New Jersey, an industry highly regulated by the New Jersey
Department of Environmental Protection (“DEP”).1
1 Cycle Chem initially sued Lisa P. Jackson, naming her as the Commissioner of the
DEP. Cycle Chem amended its complaint, and while Jackson’s name remains in the case
caption on appeal, the amended complaint substituted former DEP Commissioner
Bradley Campbell as the defendant in Jackson’s place.
On December 5, 2001 and
December 31, 2001, the DEP attempted to inspect Cycle Chem’s facilities pursuant to the

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New Jersey Solid Waste Management Act and associated regulations. Cycle Chem failed
to provide certain requested documents and to allow inspection of its oil drums at that
time.
The DEP imposed two penalties on Cycle Chem for failing to permit the
inspections. Cycle Chem contested those penalties in a state administrative proceeding
before an administrative law judge. The Commissioner of the DEP adopted the findings
of the administrative law judge, upheld the imposition of the penalties, and fixed their
total amount at $29,000. Cycle Chem appealed the Commissioner’s decision to the
Appellate Division of the New Jersey Superior Court, which affirmed the
Commissioner’s ruling. The New Jersey Supreme Court then denied Cycle Chem’s
petition for certification in November 2005.
Two years later, Cycle Chem filed a § 1983 action in federal court, alleging due
process and Fourth Amendment violations. Cycle Chem claims that the Defendant, the
Commissioner of the DEP, violated its due process rights by imposing the penalties
without evidence that Cycle Chem refused to allow the DEP to inspect the premises, and
that the decision of the administrative law judge and the Commissioner violated its due
process rights by upholding the penalties despite no evidence sustaining their validity.
Cycle Chem further claims that the administrative search regime authorizing the DEP to
inspect its facilities violates the Fourth Amendment.
The Commissioner moved to dismiss Cycle Chem’s case. At oral argument, the
District Court granted that motion on the basis of the Rooker-Feldman doctrine. See
generally Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280 (2005). The

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District Court also denied Cycle Chem’s motion for leave to file a second amended
complaint because that proposed complaint would also have been subject to dismissal
under the Rooker-Feldman doctrine. The District Court memorialized its decision in an
order filed on September 4, 2008. That order provided that Cycle Chem “may, within 30
days of the date of this Order, file a renewed motion for leave to file a Second Amended
Complaint to assert claims for relief not based on the alleged wrongdoing underlying the
claim asserted in the Amended Complaint.” If Cycle Chem did not file the renewed
motion, the order further provided that “the Amended Complaint will be dismissed with
prejudice and the Clerk of the Court will be directed to close this case.” (App. at A2.)
On September 19, 2008, Cycle Chem filed a motion for reconsideration under
Federal Rule of Civil Procedure 59(e). Under then-existing rules, that motion was
untimely. See Fed. R. Civ. P. 59(e) (2008) (requiring that a motion for reconsideration be
filed no later than ten days after entry of the judgment). In its motion, Cycle Chem
argued that the District Court was wrong to dismiss the complaint on the basis of the
Rooker-Feldman doctrine. Cycle Chem also renewed its motion to file a second amended
complaint, timely submitting that filing on October 3, 2008. In an order filed on January
6, 2009, the District Court denied Cycle Chem’s motion for reconsideration and renewed
motion to file a second amended complaint. The order also provided that “this action be
and hereby is CLOSED.” (App. at A13.) Cycle Chem then filed a notice of appeal on
February 2, 2009, which was timely when measured from the order denying the motion
for reconsideration, but clearly untimely when measured from the order dismissing the

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complaint. See Fed. R. App. P. 4(a)(1) (setting a 30-day deadline to file a notice of
appeal).
II. Discussion
A threshold issue — whether the September 4, 2008 order dismissing Cycle
Chem’s complaint was an appealable final order — must first be answered so that we
may determine the scope of our jurisdiction in this appeal. If the initial dismissal order
was not an appealable final judgment, Cycle Chem’s notice of appeal from the order
denying the motion for reconsideration would bring up the initial dismissal order for
review. That is, if the initial dismissal order was merely an interlocutory order, then the
January 6, 2009 order would be the only final order in this case. As such, we would then
have jurisdiction over both the January 6, 2009 order and the initial dismissal order
because under the merger rule, prior interlocutory orders, like the initial dismissal order
here, “merge with the final judgment in a case, and the interlocutory orders (to the extent
that they affect the final judgment) may be reviewed on appeal from the final order.”
Pineda v. Ford Motor Co., 520 F.3d 237, 243 (3d Cir. 2008) (internal quotation marks
and citation omitted). If, however, the initial dismissal order was an appealable final
order, we would need to address whether Cycle Chem’s notice of appeal brings up the
initial dismissal order for review, i.e., whether Appellate Rule 4(a)(4)(A) tolls the time
for taking the appeal.
We find that the initial dismissal order was not an appealable final order. Rather,
the order was essentially a dismissal without prejudice because it granted Cycle Chem the

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opportunity to file a renewed motion to file a second amended complaint. A dismissal
without prejudice is generally not an appealable final judgment under 28 U.S.C. § 1291,
unless “the plaintiff cannot cure the defect in the complaint or elects to stand on the
complaint without amendment.” Bethel v. McAllister Bros., Inc., 81 F.3d 376, 381 (3d
Cir. 1996). Cycle Chem did not elect to stand on the complaint without amendment;
instead, it renewed its motion to file a second amended complaint, which it believed
alleged wrongdoing that did not form the basis of the complaint that the District Court
dismissed. Therefore, the initial dismissal order was not an appealable final order under
28 U.S.C. § 1291.
Only the order denying Cycle Chem’s motion for reconsideration was an
appealable final order under 28 U.S.C. § 1291; in that order, the District Court finally
dismissed the case with prejudice by ordering that “this action be and hereby is
CLOSED.” (App. at A13.) Cycle Chem’s notice of appeal was timely when measured
from that order. Because under the merger rule, the initial dismissal order is merged with
the final judgment, we review on appeal both the District Court’s denial of the motion for
reconsideration and the initial underlying dismissal.2
2 To the extent that the order denying the motion for reconsideration also denied Cycle
Chem’s renewed motion for leave to file a second amended complaint, we do not review
it on appeal. Cycle Chem has waived any right to appeal that decision, for it has not
presented any argument on that portion of the District Court’s order in its briefs. See
Kost v. Kozakiewicz, 1 F.3d 176, 182 (3d Cir. 1993).
We exercise plenary review over
those decisions. See Tourscher v. McCullough, 184 F.3d 236, 240 (3d Cir. 1999)
(exercising plenary review over a motion to dismiss); Max’s Seafood Cafe ex rel. Lou-

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Ann, Inc. v. Quinteros, 176 F.3d 669, 673 (3d Cir. 1999) (exercising plenary review when
the denial of a motion for reconsideration is predicated on an issue of law).
The District Court initially dismissed the case without prejudice and denied the
motion for reconsideration for the same reason; it believed that pursuant to the Rooker-
Feldman doctrine, it had no subject matter jurisdiction over Cycle Chem’s suit. The
Rooker-Feldman doctrine “takes its name from the only two cases in which the Supreme
Court has applied it to defeat federal subject-matter jurisdiction: Rooker v. Fidelity Trust
Co., 263 U.S. 413, 44 S.Ct. 149, 68 L.Ed. 362 (1923), and District of Columbia Court of
Appeals v. Feldman, 460 U.S. 462, 103 S.Ct. 1303, 75 L.Ed.2d 206 (1983).” Great
Western Mining & Mineral Co. v. Fox Rothschild LLP, 615 F.3d 159, 164 (3d Cir. 2010).
As the Supreme Court has explained, the Rooker-Feldman doctrine “is confined to cases
of the kind from which the doctrine acquired its name: cases brought by state-court
losers complaining of injuries caused by state-court judgments rendered before the
district court proceedings commenced and inviting district court review and rejection of
those judgments.” Exxon Mobil Corp., 544 U.S. at 284. The doctrine, the Court has
emphasized, applies in “limited circumstances” and is “not triggered simply by the entry
of judgment in state court.” Id. at 291, 292.
There are four requirements that must be met for the Rooker-Feldman doctrine to
apply: “(1) the federal plaintiff lost in state court; (2) the plaintiff complain[s] of injuries
caused by [the] state-court judgments; (3) those judgments were rendered before the
federal suit was filed; and (4) the plaintiff is inviting the district court to review and reject
the state judgments.” Great Western Mining, 615 F.3d at 166 (internal quotation marks

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and citation omitted). “The second and fourth requirements are the key to determining
whether a federal suit presents an independent, non-barred claim.” Id. Here, the District
Court focused on the second requirement. It reasoned that Cycle Chem’s injury — the
penalties — was caused by the state-court judgments because even though the penalties
were imposed by the DEP, they were upheld by the New Jersey Appellate Division.
As we explained in our recent opinion in Great Western Mining, we can determine
whether a plaintiff is complaining of injuries caused by a state-court judgment by
identifying the source of the plaintiff’s injury. If the Rooker-Feldman doctrine is to
apply, the injury must be caused by the state-court judgment, not the defendant. But
“when the source of the injury is the defendant’s actions (and not the state court
judgments), the federal suit” is not barred by the Rooker-Feldman doctrine, “even if it
asks the federal court to deny a legal conclusion reached by the state court.” Id. at 167.
We further noted that “[a] useful guidepost is the timing of the injury, that is, whether the
injury complained of in federal court existed prior to the state-court proceedings and thus
could not have been ‘caused by’ those proceedings.” Id. (citations omitted).
Cycle Chem’s injury, from the alleged due process and Fourth Amendment
violations, stemmed not from the New Jersey Appellate Division’s decision to uphold the
penalties. Rather, the source of the injury is the DEP, for it is the DEP that engaged in
allegedly illegal warrantless searches of Cycle Chem’s facilities and imposed penalties on
Cycle Chem without due process for impeding its attempted search. This injury occurred
before any proceedings in state court began. The Appellate Division’s decision merely
affirmed the penalties; it was not the source of the claimed injury. Therefore, the District

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Court incorrectly held that the Rooker-Feldman doctrine barred it from exercising
jurisdiction over Cycle Chem’s suit.
Nevertheless, as we observed in Great Western Mining, principles of preclusion
may still bar a federal court from hearing the claims presented. See 615 F.3d at 173
(“Ordinarily, having concluded our jurisdictional inquiry, the next step would be to apply
state law to determine the preclusive effect of the prior state-court judgments.”). We find
that res judicata, or claim preclusion, applies to Cycle Chem’s action. As a result, the
District Court was correct to dismiss Cycle Chem’s complaint and deny its motion for
reconsideration.
The doctrine of res judicata applies to federal civil actions brought under § 1983,
and, in this context, we must afford “a state-court judgment the same preclusive effect as
would be given that judgment under the law of the State in which the judgment was
rendered.” Jones v. Holvey, 29 F.3d 828, 829-30 (3d Cir. 1994) (citation omitted). Res
judicata bars the relitigation of “matters actually determined in an earlier action, [and] to
all relevant matters that could have been so determined.” Watkins v. Resorts Int’l Hotel
& Casino, Inc., 591 A.2d 592, 599 (N.J. 1991). “If, under various theories, a litigant
seeks to remedy a single wrong, then that litigant should present all theories in the first
action. Otherwise, theories not raised will be precluded in a later action.” Id. Under New
Jersey law, res judicata applies when “(1) the judgment in the first action is valid, final
and on the merits; (2) there is identity of the parties, or the parties in the second action are
in privity with those in the first action; and (3) the claim in the later action grows out of
the same transaction or occurrence as the claim in the first action.” Jones, 29 F.3d at 830

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(citing Watkins, 591 A.2d at 599; Culver v. Ins. Co. of N. Am., 559 A.2d 400, 405-06
(N.J. 1989)).
All three requirements are met here. The judgment rendered by the New Jersey
Appellate Division was valid, final and on the merits. There is also identity of the
parties, for Cycle Chem was a party to the first action and the Defendant, the DEP
Commissioner, is the DEP’s privy. See Jones, 29 F.3d at 830 (finding that the
defendants, who were employees of a state agency, were in privity with that state agency,
which was the defendant in the first action); see also Schuster v. Martin, 861 F.2d 1369,
1373 (5th Cir. 1988) (“It is also a general principle of the law of preclusion that state
officials are, as a matter of law, in privity with the agency or department in which they
serve.”).
Finally, the claims presented in this action grow out of the same transaction or
occurrence as the claims in the first action; indeed, the New Jersey Appellate Division
considered and rejected the same claims that Cycle Chem brings here. Cycle Chem’s
claims here stem from the DEP’s allegedly illegal search of Cycle Chem’s facilities and
imposition of penalties on Cycle Chem for impeding the attempted search. In its opinion,
the Appellate Division listed Cycle Chem’s arguments, among them that the DEP “lacked
authority to conduct a warrantless search” and that the penalties were wrongfully
imposed. (App. at A37.) The Appellate Division then rejected those arguments,
discerning “no basis in the record of this matter justifying a departure from the general
rule permitting ‘administrative,’ i.e. warrantless, searches of highly or pervasively
regulated industries” and finding that the penalties were therefore properly imposed. (Id.

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at A38-39.) By doing so, the Appellate Division demonstrated that it would have
exercised its original jurisdiction to resolve the § 1983 claims had Cycle Chem brought
them in state court. See Jones, 29 F.3d at 831-32 (predicting whether a state court would
have exercised original jurisdiction over a § 1983 claim in an appeal from an
administrative decision). Accordingly, res judicata bars a federal court from entertaining
Cycle Chem’s suit. The District Court was correct to dismiss Cycle Chem’s complaint
and deny its motion for reconsideration.
III. Conclusion
For the foregoing reasons, we will affirm the judgment of the District Court.

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