Abelesz v. Erste Grp. Bank AG

• Decision Date: 22 August 2012
• Docket Number: 11–2946.,Nos. 11–2940,s. 11–2940
• Citation: 695 F.3d 655
• Parties: Erno Kalman ABELESZ et al., Plaintiffs–Appellees, v. ERSTE GROUP BANK AG, Defendant–Appellant. In re Erste Group Bank AG, Petitioner.
• Court: U.S. Court of Appeals — Seventh Circuit

695 F.3d 655

Erno Kalman ABELESZ et al.,^* Plaintiffs–Appellees,

v.ERSTE GROUP BANK AG, Defendant–Appellant.

In re Erste Group Bank AG, Petitioner.

Nos. 11–2940, 11–2946.

United States Court of Appeals,

Seventh Circuit.

Argued Jan. 11, 2012.

Decided Aug. 22, 2012.

Anthony Alfred D'Amato, Attorney, Northwestern University School of Law, Paul M. Weiss, Jeffrey A. Leon (argued), Attorney, Complex Litigation Group LLC, Highland Park, IL, Robert James Pavich (argued), Attorney, Pavich Law Group, Chicago, IL, Richard H. Weisberg, Cardozo Law School, New York, NY, for Plaintiff–Appellee and Party–in–Interest.

Steven L. Baron, Attorney, Mandell Menkes, LLC, Chicago, IL, Alan Kanzer (argued), Attorney, Alston & Bird, New York, NY, for Defendant–Appellant and Petitioner.

Before KANNE, WILLIAMS, and HAMILTON, Circuit Judges.

HAMILTON, Circuit Judge.

A group of Holocaust survivors and heirs of other Holocaust victims filed suit against several banks alleging the banks participated in expropriating property from Hungarian Jews during the Holocaust. This case and a parallel case against the Hungarian national railway have produced nine separate pending appeals and mandamus petitions. In this opinion, we address the plaintiffs' claims against defendant Erste Group Bank AG (“Erste”), which is a privately owned Austrian bank. In separate opinions released today, we address plaintiffs' claims against two other private banks, the Hungarian national bank, and the Hungarian national railway.¹

Invoking subject-matter jurisdiction under the Foreign Sovereign Immunities Act (“FSIA”), 28 U.S.C. § 1330(a), the Alien Tort Statute, 28 U.S.C. § 1350, and federal question jurisdiction, 28 U.S.C. § 1331, plaintiffs allege six causes of action: genocide, aiding and abetting genocide, bailment, conversion, constructive trust, and accounting. Plaintiffs seek to have their case certified as a class action and ask that each defendant bank be held jointly and severally responsible for damages of approximately $75 billion. The defendant banks moved to dismiss on many grounds, including lack of subject-matter jurisdiction and lack of personal jurisdiction. The district court denied all motions to dismiss, motions to reconsider, and motions for certification of interlocutory appeals under 28 U.S.C. § 1292(b). Holocaust Victims of Bank Theft v. Magyar Nemzeti Bank, 807 F.Supp.2d 689 (N.D.Ill.2011) (denying motions to dismiss); 807 F.Supp.2d 699 (N.D.Ill.2011) (denying motions for reconsideration, clarification, and certification of interlocutory appeal).

Those denials pose some challenging problems of appellate jurisdiction, as we explain in Abelesz v. OTP Bank, 692 F.3d at 645–46. The appellate jurisdiction story in this case begins with defendant Magyar Nemzeti Bank (“MNB”), the Hungarian national bank, which moved to dismiss based on a defense of sovereign immunity under the FSIA, 28 U.S.C. § 1604. The district court denied MNB's motion. MNB has appealed that denial, and as we explain in Abelesz v. Magyar Nemzeti Bank, it is well established that a denial of sovereign immunity under the FSIA is a collateral order subject to interlocutory appeal. 692 F.3d at 667. From that one sound basis for appellate jurisdiction, MNB has asked us to exercise pendent appellate jurisdiction over the other arguments it made for dismissal. And in turn, appellant Erste, like the other private banks, OTP and MKB, seeks here to stretch the narrow doctrine of pendent appellate jurisdiction to include its own appeal and the separate issues it seeks to raise. Erste, like MKB and OTP, also filed a petition for writ of mandamus, which it asks that we consider in the event that appellate jurisdiction is lacking.

Erste's appeal must be dismissed for lack of appellate jurisdiction without reaching the merits of the issues it raises.² Erste's petition for writ of mandamus is also denied because, while we recognize the extraordinary nature of this litigation, Erste has not demonstrated a clear and indisputable right to relief on par with MKB's and OTP's personal jurisdiction defense.

I. Appellate Jurisdiction

Erste seeks review of the district court's denial of its motion to dismiss. As a general rule, the district court must issue a final order before an appellate court has jurisdiction to entertain an appeal. See 28 U.S.C. § 1291. Erste advances two arguments for hearing its appeal. First, it argues that the district court's denial of its motion to dismiss based on the political question doctrine can be appealed now under the collateral order doctrine. Second, Erste argues, like all three of its co-defendants, that we can exercise pendent appellate jurisdiction over other issues because its appeal is “inextricably intertwined” with the appeals of its co-defendants. Neither argument provides us with jurisdiction over Erste's appeal.

A. Collateral Order Doctrine

Erste, like MKB, urges that the district court's rejection of its political question defense, in this case based on the United States's involvement in the creation of the Austrian General Settlement Fund (“GSF”), is a collateral order that can be appealed immediately. This argument is based on the U.S. government's efforts to “provide some measure of justice to the victims of the Holocaust, and to do so in their remaining lifetimes.” Stipulated J.A. 49 (Statement of Interest filed by U.S. government). The United States has been party to two international settlements that have provided approximately $8 billion for the benefit of victims of the Holocaust. One of these settlements, the GSF, was established by the Austrian federal government and Austrian companies to make payments for Holocaust-era claims against Austria and Austrian companies, excluding claims for restitution of works of art. To facilitate the creation and funding of the GSF, the United States pledged to help achieve “legal peace” for Austrian companieswith respect to Nazi-era claims in U.S. courts. The United States government, based on its participation in the GSF, filed in the district court a Statement of Interest pursuant to 28 U.S.C. § 517 urging dismissal of the claims against Erste “on any valid legal ground(s).” Id. at 48. The government's Statement of Interest did not argue for dismissal on any specific basis.

In its opinion denying Erste's motions for reconsideration and certification of an interlocutory appeal pursuant to 28 U.S.C. § 1292(b), the district court stated that “based on the facts of this case at this juncture, there remain questions as to whether the Government's Statement of Interest is applicable and as to whether Plaintiffs are eligible for the funds referenced in the Statement of Interest.” 807 F.Supp.2d at 706. Erste argues that the district court misinterpreted the Statement of Interest, creating a new precondition to dismissal when the filing of the Statement of Interest should have been sufficient on its own to warrant dismissal on political question grounds. Resolution of this political question issue is separate from the merits and not effectively reviewable on appeal from final judgment, says Erste, since further litigation would undermine the “legal peace” offered to Austrian corporations like Erste in exchange for their participation in the GSF.

An immediately appealable collateral order is one that (1) conclusively determines the disputed question; (2) resolves important issues separate from the merits; and (3) is effectively unreviewable on appeal from a final judgment. Mohawk Industries, Inc. v. Carpenter, 558 U.S. 100, 130 S.Ct. 599, 605, 175 L.Ed.2d 458 (2009). As we note in our analysis of MKB's parallel argument in Abelesz v. OTP Bank, 692 F.3d at 649, the collateral order doctrine is a narrow exception to “the general rule that a party is entitled to a single appeal, to be deferred until final judgment has been entered....” Digital Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 863, 868, 114 S.Ct. 1992, 128 L.Ed.2d 842 (1994) (internal citation omitted); see also Will v. Hallock, 546 U.S. 345, 350, 126 S.Ct. 952, 163 L.Ed.2d 836 (2006) (“we have not mentioned applying the collateral order doctrine recently without emphasizing its modest scope”). The court must consider the entire category of similar cases to determine whether applying the collateral order doctrine under § 1291 is appropriate. See Mohawk Industries, 130 S.Ct. at 605.

In applying these teachings, the D.C. Circuit determined that the denial of a motion to dismiss on political question grounds was not an immediately appealable collateral order, notwithstanding the fact that the first two requirements for invoking the collateral order doctrine were satisfied. Doe v. Exxon Mobil Corp., 473 F.3d 345, 349 (D.C.Cir.2007). The D.C. Circuit took to heart the Supreme Court's admonition that “we have meant what we have said; although the Court has been asked many times to expand the ‘small class' of collaterally appealable orders, we have instead kept it narrow and selective in its membership.” Will, 546 U.S. at 350, 126 S.Ct. 952; see also Doe, 473 F.3d at 349. The line between those orders that are and are not appealable as collateral orders probably owes more to history than to precise logical consistency, but the line has been drawn in precedents that we must respect and follow as best we can. Erste has not directed us to, and we have not found, any case in which a federal appeals court held that denial of a motion to dismiss on political question grounds was immediately appealable as a collateral order. Permitting an appeal from the denial of a motion to dismiss based on politicalquestion grounds would substantially expand the scope of the collateral order doctrine. We follow the D.C. Circuit on this question and hold that the collateral order doctrine does not provide appellate jurisdiction over the denial of the motion to dismiss based on Erste's political question defense. Doe, 473 F.3d at 353.³

B. Pendent Appellate Jurisdiction

As...