The Week in Federal Appellate Jurisdiction: August 1–7, 2021

There is lots to talk about from last week, including decisions involving three circuit splits. A divided Second Circuit created a split over the appealability of fugitive-disentitlement orders. The Eighth Circuit held that bankruptcy’s appeal deadline is non-jurisdictional, joining the Sixth Circuit in the split on that issue. And the Fifth Circuit noted that it now stands alone as the only court to allow appeals from denials of antitrust’s state-action defense.

In other decisions, the Second Circuit said that the scope of review in a certified bankruptcy appeal included only those issues presented in the certified order—not the specific questions that the bankruptcy court thought merited an immediate appeal. The Federal Circuit said that the time for filing a § 1292(c)(2) appeal ran from the denial of a new trial on liability, even though the district court had not yet resolved a motion for a new trial on the amount of damages. And the Eighth Circuit deemed a notice of appeal sufficient, despite the notice saying it was from, and to, courts that don’t exist. Plus an improper Rule 54(b) partial judgment, pendent appellate jurisdiction in a Rule 23(f) appeal, and a form notice of appeal in a criminal case.

• The Second Circuit on Appealing Fugitive Disentitlement
• The Eighth Circuit Held That Bankruptcy’s Appeal Deadline Is Not Jurisdictional
• The Fifth Circuit Noted Its Outlier Status on Appeals Involving Antitrust’s State-Action Defense
• The Second Circuit on the Scope of Certified Appeals
• The Federal Circuit on § 1292(c)(2) Appeals
• The Eighth Circuit on the Court- and Order-Designation Requirements for Notices of Appeal
• Quick Notes

The Second Circuit on Appealing Fugitive Disentitlement

Sometimes a fugitive defendant’s lawyer will appear in court to challenge the charges against the defendant. The defendant—who has failed to appear, evaded capture, or fled the jurisdiction—is absent. Yet the defendant hopes that the district court will dismiss some or all of the charges before the defendant submits to the court’s jurisdiction. The defendant thereby avoids the risk of confinement and conviction while hoping to obtain a favorable outcome.

District courts can refuse to consider these challenges under what’s called the fugitive-disentitlement doctrine. The doctrine allows a district court to demand the defendant’s presence before ruling on any challenges to an indictment.

In United States v. Bescond, a split Second Circuit held that defendants can immediately appeal from a fugitive-disentitlement order. A majority of the court determined that these orders are appealable via the collateral-order doctrine. Disentitlement orders, the majority said, impose severe harms on defendants and must be reviewed immediately if they are to be reviewed at all. In so holding, the Second Circuit split with the Sixth and Eleventh Circuits, which have dismissed appeals from fugitive-disentitlement orders. Dissenting, Chief Judge Livingston contended that fugitive-disentitlement orders do not involve sufficiently important interests to warrant an immediate appeal.

For more on Bescond, see my post New Split on Fugitive-Disentitlement Appeals.

United States v. Bescond, 2021 WL 3412115 (2d Cir. Aug. 5, 2021), available at CourtListener and Westlaw.

The Eighth Circuit Held That Bankruptcy’s Appeal Deadline Is Not Jurisdictional

In In re VeroBlue Farms USA, Inc., the Eighth Circuit determined that bankruptcy’s part-statute, part-rule appeal deadline is not jurisdictional.

The Supreme Court has drawn a fairly clear line between deadlines found in statutes—which are jurisdictional—and those found only in rules of procedure—which aren’t. Bankruptcy’s appeal deadline is a bit of a hybrid. It comes partially from a statute—28 U.S.C. § 158(c)(2)—and partially from a rule—Federal Rule of Bankruptcy Procedure 8002. The statutory part has led most courts to conclude that the 14-day deadline is jurisdictional.

But last October, the Sixth Circuit became the first court to hold that bankruptcy’s appeal deadline is not jurisdictional. In In re Tennial, the Sixth Circuit explained that the statute says only that appeals must come within a time specified by the bankruptcy rules. The actual deadline comes from those rules.

In VeroBlue Farms, the Eighth Circuit sided with the Sixth. The court found Tennial’s reasoning persuasive, quoted it at length, and deepened the circuit split.

Though not jurisdictional, the appeal deadline was still mandatory. And the appellees in VeroBlue Farms objected to the late notice of appeal. The Eighth Circuit accordingly determined that the appeal was untimely.

For more on this issue, see my posts New Split on Bankruptcy’s Appeal Deadline and Is Bankruptcy’s Hybrid Appeal-Filing Deadline Jurisdictional?

In re VeroBlue Farms USA, Inc., 2021 WL 3411834 (8th Cir. Aug. 5, 2021), available at the Eighth Circuit and Westlaw.

The Fifth Circuit Noted Its Outlier Status on Appeals Involving Antitrust’s State-Action Defense

In Quadvest, L.P. v. San Jacinto River Authority, the Fifth Circuit heard an appeal from the denial of antitrust’s state-action defense, which is often called “Parker immunity.” In the course of doing so, the Fifth Circuit noted that it is now the only circuit to allow for immediate appeals from the rejection of this defense. The Eleventh Circuit used to agree with the Fifth that these denials were immediately appealable via the collateral-order doctrine. But last month, the en banc Eleventh Circuit overruled its caselaw in this area. The Quadvest panel noted that it remained bound by its precedent allowing these appeals, and neither party had challenged appealability.

Quadvest, L.P. v. San Jacinto River Authority, 2021 WL 3362470 (5th Cir. Aug. 3, 2021), available at the Fifth Circuit and Westlaw.

The Second Circuit on the Scope of Certified Appeals

In In re Gravel, the Second Circuit limited its review in a certified bankruptcy appeal to the certified order, not the questions that the bankruptcy court had certified.

Gravel arose from a bankruptcy court order that imposed punitive sanctions on a creditor. Simplifying a bit, the creditor held or serviced the debtors’ mortgages. The creditor sent the debtors a statement that included $700 in previously undisclosed fees. The bankruptcy court determied that these fees violated both an order finding that the debtors were current on their mortgages and Bankruptcy Rule of Procedure 3002.1 (which requires that creditors inform debtors of new post-petition fees and charges). The bankruptcy court then imposed about $300,000 in punitive sanctions. The court also certified this order for a direct appeal to the court of appeals under 28 U.S.C. § 158(d)(2).

Before deciding whether the bankruptcy court could impose these punitive sanctions, the Second Circuit had to determine the scope of the appeal. Section 158(d)(2) is a lot like 28 U.S.C. § 1292(b). It allows a bankruptcy court to certify an order for an immediate appeal to the court of appeals. Absent certification, the case would first have to go to a district court or bankruptcy appellate panel, after which it might be within the court of appeals’s jurisdiction. Section 158(d)(2) skips this intermediate step.

The bankruptcy court had certified three questions that concerned a bankruptcy court’s power to impose sanctions. The parties wanted the Second Circuit to address all of those questions on appeal. But § 158(d)(2) does not grant appellate jurisdiction over questions. It instead allows the bankruptcy court to certify an “order” for an immediate appeal. So the Second Circuit could address only those issues that were posed in that order. To do otherwise would be an advisory opinion.

In re Gravel, 2021 WL 3277211 (2d Cir. Aug. 2, 2021), available at CourtListener and Westlaw.

The Federal Circuit on § 1292(c)(2) Appeals

In Mondis Technology Ltd. v. LG Electronics Inc., the Federal Circuit deemed untimely an appeal filed more than 30 days after the district court denied a retrial on all issues except damages.

Mondis Technology was a patent-infringement suit. A jury found that the defendant had infringed the patent, that the patent was valid, and that the defendant’s infringement was willful. The jury awarded $45 million in damages. Shortly thereafter, the defendant moved for a new trial on each of these findings—infringement, validity, willfulness, and the amount of damages. The district court initially denied a new trial on the liability issues: infringement, validity, and willfulness. But the court asked for additional briefing on damages. Seven months later, the district court ordered a new trial on damages. A few weeks after that, the defendant appealed to challenge the denial of a new trial on liability.

The Federal Circuit determined that this appeal was untimely. 28 U.S.C. § 1292(c)(2) gives the Federal Circuit jurisdiction over “an appeal from a judgment in a civil action for patent infringement which would otherwise be appealable to the United States Court of Appeals for the Federal Circuit and is final except for an accounting.” The defendant in Mondis Technology accordingly had to file its notice of appeal within 30 days of the district court’s decision becoming final except for an accounting. And “under § 1292(c)(2), a judgment is final except for an accounting when all liability issues have been resolved, and only a determination of damages remains.”

The district court’s initial order denying a new trial on all issues except damages resolved all liability issues. The only issue left concerned the amount of damages. That first order was accordingly appealable under § 1292(c)(2), and the defendant’s notice of appeal—filed several months later—was untimely.

The Federal Circuit went on to reject the defendant’s argument that Federal Rule of Appellate Procedure 4(a)(4) delayed the start of the appeal clock. Rule 4(a)(4) provides that the filing of certain post-judgment motions delays the start of the time to appeal.

The Federal Circuit said that Rule 4(a)(4) applied to both interlocutory appeals (like the one in Mondis Technology) and final-judgment appeals. But since § 1292(c)(2) deals with appeals from liability but not damages, only post-judgment motions concerning liability (and not those concerning damages) can affect the appeal clock. So in Mondis Technology, the motions for a new trial on liability postponed the start of the appeal clock until the district court resolved those motions. The motion for a new trial on damages did not relate to the determination of liability and thus did not affect the time to appeal under § 1292(c)(2).

The Federal Circuit ended its opinion by noting that § 1292(c)(2) appeals are optional. The defendant can accordingly challenge liability in a final-judgment appeal, after the district court determines the amount of damages.

Mondis Technology Ltd. v. LG Electronics Inc., 2021 WL 3354780 (Fed. Cir. Aug. 3, 2021), available at the Federal Circuit and Westlaw.

The Eighth Circuit on the Court- and Order-Designation Requirements for Notices of Appeal

In Kohlbeck v. Wyndham Vacation Resorts, Inc., the Eighth Circuit had to address a potentially defective notice of appeal.

Kohlbeck involved consumer-protection claims against a timeshare company and the timeshare company’s counterclaims for breach of contract. The district court eventually dismissed the plaintiffs’ claims and granted the timeshare company’s motion for summary judgment on liability. The timeshare company then moved for damages, while the plaintiffs moved to reconsider the liability ruling. The district court eventually granted the timeshare company’s damages request and denied the plaintiffs’ motion for reconsideration.

The plaintiffs appealed. But in their notice of appeal, they designated only the district court’s last order—granting the timeshare company’s request for damages and denying the plaintiffs’ motion for reconsideration. The notice of appeal also said that the plaintiffs were appealing from the “United States District Court for the Southern District of Missouri” and “to the United States Court of Appeals for the Southern District of Missouri,” neither of which exist.

The Eighth Circuit ultimately determined that the notice was sufficient to appeal the district court’s liability decision. Federal Rule of Appellate Procedure 3(c)(1) requires that a notice of appeal designate the appealed judgment or order as well as the court to which the appeal is taken. Courts treat Rule 3(c)(1)’s requirements as jurisdictional (even though the requirements come only from a procedural rule). But they also construe notices of appeal liberally, “permit[ting] review where the intent of the appeal is obvious and the adverse party incurs no prejudice.”

As for the court designation, the Eighth Circuit excused the failure to name it. That court had recently dismissed an appeal when the “entirely deficient” notice failed to name the proper court. But the notice in that case had other problems. And it was obvious in Kohlbeck that the plaintiffs wanted to appeal to the Eighth Circuit; no one was harmed by their failure to say as much.

As for the order designation, the Eighth Circuit determined that specifying the damages decision was sufficient to include the liability decision within the scope of review. The district court’s decision was not final until that court determined the amount of damages, so the damages decision was the only final, appealable order in the action. The designation of a final order brings with it all previous rulings that merged into the final decision. And the timeshare company was in no way prejudiced by the plaintiffs’ omitting the liability decision from their notice of appeal.

Note, the difficulties courts sometimes have with the order-designation requirement should soon disappear. Pending amendments to Rule 3(c) provide that:

• “[A] notice of appeal encompasses the final judgment . . . if the notice designates an order that adjudicates all remaining claims and the rights and liabilities of all remaining parties”;
• “Without [an express statement limiting the scope of the notice of appeal], specific designations do not limit the scope of the notice of appeal”; and
• “An appeal must not be dismissed . . . for failure to properly designate the judgment if the notice of appeal was filed after entry of the judgment and designates an order that merged into that judgment.”

These amendments should end the practice of appellate courts using order designations to limit the scope of an appeal.

Thanks to Howard Bashman for sending me this case.

Kohlbeck v. Wyndham Vacation Resorts, Inc., 2021 WL 3354356 (8th Cir. Aug. 3, 2021), available at the Eighth Circuit and Westlaw.

Quick Notes

In Dinosaur Merchant Bank Limited v. Bancservices International LLC, the Eight Circuit held that a district court abused its discretion in entering a partial judgment under Federal Rule of Civil Procedure 54(b). That rule permits a district court to enter an partial judgment on the resolution of some—but not all—claims in a multi-claim suit. An aggrieved party can then appeal from the partial judgment, despite the pending claims. But courts of appeals normally require that the resolved claims be distinct from those that remain. Otherwise the court will have to tread similar ground in two appeals—one from the partial judgment and one after a final judgment. The Eighth Circuit determined that the partial judgment in Dinosaur Merchant Bank was too related to the remaining claims—the still-pending claims involved the same facts and similar law. The Eighth Circuit accordingly dismissed the appeal.

Dinosaur Merchant Bank Limited v. Bancservices International LLC, 2021 WL 3440750 (8th Cir. Aug. 6, 2021), available at the Eighth Circuit and Westlaw.

In In re Zetia (Ezetimibe) Antitrust Litigation, the Fourth Circuit refused to extend pendent appellate jurisdiction over a partial dismissal alongside a Rule 23(f) appeal. Zetia involved a suit against two pharmaceutical companies, which alleged that the defendants’ settlement of a patent dispute was anticompetitive. The district court initially dismissed one group of plaintiffs who did not directly purchase the the drug in question. The district court later certified the remaining claims for class treatment. The Fourth Circuit then granted the defendants’ request to immediately appeal the class-certification decision via Federal Rule of Civil Procedure 23(f). The court declined, however, to also review the partial dismissal via pendent appellate jurisdiction. The appealable issue—the propriety of class certification—did not involve the same legal analysis as the pendent issue—whether the dismissed plaintiffs had antitrust standing. The two issues were thus not inextricably intertwined, and the exercise of pendent jurisdiction would have been improper.

In re Zetia (Ezetimibe) Antitrust Litigation, 2021 WL 3379035 (4th Cir. Aug. 4, 2021), available at the Fourth Circuit and Westlaw.

In United States v. Howard, the Second Circuit excused a defendant’s failure to check a box indicating that he was appealing from his conviction. The defendant in Howard was convicted for a racketeering conspiracy, and the district court denied the defendant’s motion for acquittal on that conviction. The defendant then appealed. But his notice of appeal designated only the denial of an acquittal. He did not check a box in the form notice that would have also specified his conviction. The Second Circuit nevertheless reviewed the conviction. The defendant’s intent to challenge his conviction was clear, as “[t]here is no practical difference between appealing from a district court’s judgment of conviction and a district court’s denial of a motion for a judgment of acquittal on that judgment of conviction.” The defendant also indicated in his notice “that his appeal concerned his ‘Conviction.’”

United States v. Howard, 2021 WL 3354983 (2d Cir. Aug. 3, 2021), available at CourtListener and Westlaw.