Using two-dimensional electrostatic particle-in-cell code, we study the dynamical behavior of planar double layers (DLs) in magnetized plasmas nonuniformly distributed along an ambient magnetic field Bo. The plasma is driven by a magnetic field-aligned (parallel) potential drop with a polarity appropriate for the return current auroral plasma; the low-density hot plasma at the top of the simulation plane is positive with respect to the high-density cold plasma at the bottom. In response to the applied potential drop, a planar double layer rapidly forms at the evolving interface between the cold and hot plasmas. The ions accelerated downward by the DL into the cold plasma generate low-frequency electrostatic ion cyclotron (EIC) fluctuations; their nonlinear evolution fragments the DL horizontally into filamentary DLs having U- and V-shaped equipotentials like in diverging electrostatic shocks (D-shocks). The filamentary potential structures have density depletions bounded by high-density plasma columns. The cold electrons accelerated by the parallel fields inside the DL substructures (DLSS) generate electron holes, which become the dominant feature of the plasma above the regions of the parallel fields. The initial filaments have the size of hot ion Larmor radius, but at latter times the transverse size of the filaments increases as they dynamically evolve both in shape and size with the transverse ion heating. During the process of fragmentation of the initial DL the cold ions undergo considerable transverse acceleration by the perpendicular electric fields in the developing substructures. Those initially cold ions which manage to get above the time-dependent DLSSs and even the hot ions traversing the region above them are seen to undergo significant heating in both parallel and perpendicular directions by the sustained interactions with the upward moving large-amplitude electron holes. Relevance of our findings to the physics of the auroral return current plasma is discussed.