The Week in Federal Appellate Jurisdiction: September 15–21, 2019

This week’s roundup was slightly delayed. Last week saw several unique and interesting decisions on appellate jurisdiction. The Seventh Circuit said that the civil-appeal deadline applied to a criminal forfeiture order. The Third Circuit allowed the appeal of a gag order that prohibited a defendant from contacting the plaintiff’s shareholders. And the Eleventh Circuit navigated the rules on post-judgment discovery appeals in the context of an order enforcing arbitral summonses.

The Seventh Circuit on the deadline for appealing criminal forfeiture orders

In United States v. Segal, the Seventh Circuit held that the civil-appeal deadline (60 days, since the case involved the United States), and not the criminal-appeal deadline (14 days), applied to an order refusing to modify the settlement of a criminal forfeiture obligation.

After being convicted for racketeering, fraud, and other offenses, the defendant in Segal settled his forfeiture obligations with the government. But he later sought to rescind or modify that agreement. The district court refused, and the defendant appealed.

The government challenged appellate jurisdiction because the defendant had not filed his notice of appeal within 14 days of the district court’s decision. But the Seventh Circuit applied the 60-day deadline for civil appeals in which the United States is a party. The district court’s decision was technically made as part of criminal proceedings. But the relief sought was was of a civil nature: rescission or modification of the settlement. The Seventh Circuit thus concluded that the decision “resolved what was in essence a civil dispute embedded within a criminal case.”

Segal also held that appellate jurisdiction existed despite the continuing liquidation proceedings. The modification that the defendant sought—immediate transfer of property—was a kind of injunctive relief. Denial of that relief was thus appealable under 28 U.S.C. § 1292(a)(1).

On the merits of the appeal, the Seventh Circuit held that the challenge to the district court’s decision was groundless.

United States v. Segal, 2019 WL 4399864 (7th Cir. 2019), available at the Seventh Circuit and Westlaw.

The Third Circuit on appealing gag orders

In Bank of Hope v. Chon, the Third Circuit held that an order prohibiting a defendant from contacting the plaintiff’s shareholders was appealable under the collateral-order doctrine.

Chon involved a bank’s suit for embezzlement against its founder. The founder wrote letters to the bank’s executive, denying any involvement in a former bank employee’s scheme to steal more than a million dollars from the bank’s customers. When that didn’t work, the founder started mailing the bank’s shareholders. He again denied wrongdoing and warned that the lawsuit would harm the bank. Unhappy with these letters, the bank sought and obtained an order prohibiting the founder from further contacting the shareholders.

The Third Circuit held that the gag order was immediately appealable under the collateral-order doctrine. The order definitively resolved the founder’s ability to speak to shareholders. The gag order was separate from the merits or the embezzlement claim and presented important issues about the founder’s First Amendment rights. And the order could not be effectively reviewed after a final judgment; the court could never give the founder back the opportunity to timely contact shareholders.

On the merits, the Third Circuit held that the gag order violated the founder’s First Amendment rights, as the order was not necessary to protect the integrity of the proceedings.

The opinion had a few quirks. First, some of the analysis was case-specific, which conflicts with the normal requirement that collateral-order decisions be categorical. Second, the court said that “[c]ollateral orders are by definition not final.” That’s not right. The collateral-order doctrine is technically an interpretation of what it means for something to be a “final decision” under 28 U.S.C. § 1291. It operates as an exception to the final-judgment rule. But collateral orders are “final” for purposes of § 1291.

Bank of Hope v. Chon, 2019 WL 4431856 (3d Cir. 2019), available at the Third Circuit and Westlaw.

The Eleventh Circuit on appeals from the conditions on an amendment

In Bell v. Guardian Automotive Corp., the Eleventh Circuit held that it lacked jurisdiction to review an order imposing conditions on the amendment of the plaintiffs’ complaint.

After extensive discovery and briefing on the plaintiffs’ class claims, they sought leave to amend their complaint to remove all class allegations. The district court granted the motion, finding that the prejudice to the defendants could be minimized by requiring that plaintiffs pay the costs and expenses the defendants had incurred in defending the class claims. After further disputes as the the amount, the district court eventually ordered the plaintiffs to pay about $240,000. The plaintiffs appealed.

The Eleventh Circuit held that the order was not appealable. It did not satisfy the requirements for the collateral-order doctrine, as the conditions of the amendment could be effectively reviewed on appeal from the final judgment. And the plaintiffs had inadequately briefed their argument that invoked the practical-finality exception to the final-judgment rule.

Bell v. Guardian Automotive Corp., 2019 WL 4466856 (11th Cir. 2019), available at the Eleventh Circuit and Westlaw.

The Eleventh Circuit on arbitration summonses

In Managed Care Advisory Group, LLC v. CIGNA Healthcare, Inc., the Eleventh Circuit held that it had jurisdiction to review an order enforcing arbitral summonses.

The jurisdictional dispute in Managed Care stemmed from an arbitrator’s issuing non-party summonses to several third parties, requiring them to appear at an arbitration hearing. The summoned (or summonsed?) parties objected, and the district court enforced the summonses under 9 U.S.C. § 7.

The Eleventh Circuit faced two conflicting lines of authority on appealability. On the one hand, a post-judgment order is final and appealable if it ends the post-judgment proceedings, and the arbitral proceedings in Managed Care were post-judgment proceedings to enforce a settlement. On the other hand, post-judgment orders compelling discovery are generally not final or appealable. Navigating these two points of precedent, the court concluded that the district court’s order ended the proceedings in question—the proceedings to enforce the arbitral summonses. Because the district court had disposed of all of the issues before it, the enforcement order was final and appealable.

On the merits, the Eleventh Circuit reversed the enforcement of the summonses.

Managed Care Advisory Group, LLC v. CIGNA Healthcare, Inc., 2019 WL 4464301 (11th Cir. 2019), available at the Eleventh Circuit and Westlaw.

The Seventh Circuit on appealing from a dismissal for want of prosecution

In Bertha v. Hain, the Seventh Circuit held that it had jurisdiction over an appeal even though the plaintiff’s case had been dismissed for failure to prosecute.

The plaintiff in Bertha had sued several government officials—judges, prosecutors, and law-enforcement officers—who were involved in his prosecutions for contempt and trespass. After the district court dismissed the bulk of his complaint, the remainder was eventually dismissed for failure to prosecute. The plaintiff then appealed.

The Seventh Circuit held that the appeal was not limited to the order dismissing the case for failure to prosecute. All interlocutory decisions merged into the final judgment dismissing the plaintiff’s claims. And there was no suggestion that the plaintiff was acting in bad faith—that he had invited the dismissal to secure appellate review of interlocutory decisions.

On the merits, the Seventh Circuit affirmed dismissal of the plaintiff’s claims.

Bertha v. Hain, 2019 WL 4458390 (7th Cir. 2019), available at the Seventh Circuit and Westlaw.

The Ninth Circuit on administrative appeals

In Pit River Tribe v. Bureau of Land Management, the Ninth Circuit held that it had jurisdiction to review an order remanding a dispute to the Bureau of Land Management.

The case involved a challenge to the Bureau’s decision to continue 26 geothermal leases in California. The Bureau argued that so long as 1 of the 26 leases produced steam at a commercial quantity, it could continue all the leases. But a district court disagreed and remanded the case to the Bureau to determine whether to cancel the non-producing leases.

Although orders remanding a dispute to an agency for further proceedings are normally not appealable, the Ninth Circuit held that it had jurisdiction over this one. The district court’s decision ordered the Bureau to apply a particular legal standard regarding the maintenance of leases. Were the Bureau to apply that rule and lose in the administrative proceedings, there would be no avenue for it to appeal—it cannot appeal its own decisions. So for the Bureau to obtain any appellate review of the district court’s decision on the correct legal standard, it needed to be immediate.

On the merits, the Ninth Circuit affirmed—the district court’s interpretation of the relevant statute was correct.

Pit River Tribe v. Bureau of Land Management, 2019 WL 4508340 (9th Cir. 2019), available at the Ninth Circuit and Westlaw.