In re Blinder Robinson & Co., Inc.
| Decision Date | 17 October 1991 |
| Docket Number | No. 91-K-983.,91-K-983. |
| Citation | 132 BR 759 |
| Parties | In re BLINDER ROBINSON & CO., INC., Debtor. INTERCONTINENTAL ENTERPRISES, INC., Greg Gerganoff, Kalmon Glovin, Thomas Orrell, John Winston, Appellants, v. Glen E. KELLER, Jr., Trustee for Blinder, Robinson & Co., Inc., Appellee. |
| Court | U.S. District Court — District of Colorado |
Michael E. Katch, Dana M. Arvin, Katch, Wasserman & Jobin, Denver, Colo., Jay L. Gueck, Gueck & Mohoney, Dallas, Tex., for appellant Intercontinental Enterprises, Inc.
Kalmon Glovin, pro se.
John Fogerty Winston, pro se.
Thomas E. Orrell, pro se.
Gregory Z. Gerganoff, pro se.
William A. Bianco, Madison E. Bond, Davis, Graham & Stubbs, Denver, Colo., for debtor Blinder Robinson & Co., Inc.
Glen E. Keller, Jr., Englewood, Colo., Trustee for Liquidation of Blinder, Robinson & Co., Inc.
ORDER GRANTING MOTION TO DISMISS APPEAL
This matter is before me on the motion by the trustee for the liquidation of Blinder, Robinson & Co. ("trustee") to dismiss this appeal for lack of jurisdiction. The trustee contends that (1) the appeal of the February 15, 1991 Disqualification Order ("Disqualification Order") by Intercontinental Enterprises, Inc. ("Intercontinental") was untimely, (2) that former Blinder Robinson attorneys Greg Gerganoff, Kalmon Glovin, Thomas Orrell, and John Winston (collectively, "former Blinder Robinson attorneys") lack standing to appeal the Disqualification Order, (3) that the Disqualification Order is not a final order subject to appeal, (4) that the Disqualification Order is not a collateral order otherwise appealable, (5) that interlocutory appeal is not justified, and (6) that the former Blinder Robinson attorneys' appeal of the May 28, 1991 order was rendered moot by the bankruptcy court's April 5, 1991 order.
On July 30, 1990, Blinder, Robinson & Co. ("Blinder Robinson") filed a petition for reorganization under Chapter 11 of the Bankruptcy Code. On August 1, 1990, the Securities Investor Protection Corporation ("SIPC") filed a complaint in the District Court for the District of Colorado seeking a decree that the customers of Blinder Robinson were in need of protection under the Securities Investor Protection Act ("SIPA"), 15 U.S.C. §§ 78aaa-78lll. The court granted SIPC's request, appointed Glen E. Keller, Jr. as trustee for the liquidation of Blinder Robinson, appointed the law firm of Davis, Graham, and Stubbs as counsel for the trustee, and removed the proceedings to the bankruptcy court for liquidation of Blinder Robinson under SIPA.
At the time the SIPA proceedings commenced, Blinder Robinson employed Greg Gerganoff, Kalmon Glovin, Thomas Orrell, and John Winston as in-house counsel. Upon commencing his duties, the trustee terminated the attorneys' employment with Blinder Robinson, and they subsequently became employed by Intercontinental. Intercontinental is the parent corporation of Blinder Robinson and one of its largest creditors. The attorneys subsequently entered appearances on behalf of Intercontinental in numerous matters adverse to the estate of Blinder Robinson.
On November 1, 1990, the trustee filed a motion seeking an order disqualifying the attorneys from representing Intercontinental in the SIPA proceedings. On February 15, 1991, the bankruptcy court granted the motion and entered the Disqualification Order 123 B.R. 900. The order prohibited the former Blinder Robinson attorneys from representing Intercontinental in the SIPA, and related, proceedings and prohibited them from disclosing any confidences, secrets, or work product acquired or created while employed by Blinder Robinson. On February 25, 1991, the attorneys, acting in their individual capacities, filed an application for intervention and a motion to amend the Disqualification Order. On March 7, 1991, Intercontinental filed a motion for a new trial or to alter or amend the Disqualification Order.
The Bankruptcy Court denied Intercontinental's motion on April 5, 1991. The motion to amend and application for intervention, filed by the former Blinder Robinson attorneys, was not ruled on until May 28, 1991. Both the motion to amend and the application to intervene were denied.
On June 5, 1991, Intercontinental filed a notice of appeal, seeking review of the Disqualification Order and the court's denial of Intercontinental's motion for a new trial. The former Blinder Robinson attorneys followed by filing a notice of appeal on June 6, 1991, seeking review of the Disqualification Order and the court's denial of the attorneys' application for intervention and motion to amend.
The trustee first argues that the notice of appeal filed by Intercontinental on June 6, 1991 was not timely. Bankruptcy Rule 8002 provides that a notice of appeal must be filed within ten days after the date of entry of the judgment, order, or decree appealed from. However, the rule further states:
If a timely motion is filed by any party: (1) for judgment notwithstanding the verdict under Rule 9015; (2) under Rule 7052(b) to amend or make additional findings of fact, whether or not an alteration of the judgment would be required if the motion is granted; (3) under Rule 9023 to alter or amend the judgment; or (4) under Rule 9023 for a new trial, the time for appeal for all parties shall run from the entry of the order denying a new trial or granting or denying any other such motion. A notice of appeal filed before the disposition of any of the above motions shall have no effect; a new notice of appeal must be filed. No additional fees shall be required for such filing.
Bankr.R. 8002(b). A notice of appeal, not timely filed, constitutes a jurisdictional defect and mandates dismissal of the appeal. See State Bank of Spring Hill v. Anderson (In re Bucyrus Grain Co.), 905 F.2d 1362, 1367 (10th Cir.1990).
The trustee contends that because Intercontinental's motion for a new trial or to amend the Disqualification Order was denied on April 5, 1991, Intercontinental's time for appealing that order expired on April 15, 1991. Thus, Intercontinental's notice of appeal, filed on June 6, 1991, is jurisdictionally defective and the appeal should be dismissed. The trustee also argues that the motion to amend, filed by the former Blinder Robinson attorneys, is irrelevant to the calculation of time for appeal. The trustee contends that the former Blinder Robinson attorneys could not file a motion for post-trial relief because they were not parties to the controversy.
Intercontinental and the former Blinder Robinson attorneys respond by asserting that the attorneys were parties to the controversy, and thus eligible to file one of the tolling motions noted in Bankruptcy Rule 8002(b), that their motion to intervene should have been granted, and that, regardless of whether or not they were parties to the controversy, the triggering event for their time to appeal was the court's ruling on the their motions.
Intercontinental and the former Blinder Robinson attorneys have the better argument. The trustee bases his argument on Toronto-Dominion Bank v. Central National Bank & Trust Co., 753 F.2d 66 (8th Cir.1985), and the wording of Bankruptcy Rule 8002(b). Toronto-Dominion is factually distinct from this controversy. Toronto-Dominion involved a dispute between two banks over losses they suffered as a result of a check-kiting scheme. A third bank, also affected by the scheme, attempted to intervene in the litigation. After an appeal had been filed by one of the formal parties in the case, the court referred the matter for a settlement conference and specifically reserved ruling on the motion to intervene. After no settlement was reached, the case came before the court again on the previous appeal of one of the formal parties. The third bank filed a brief as a cross-appellant. The court ruled that the third bank, the potential intervenor, had no standing to appeal or appear as a party, because the motion to intervene had not yet been granted or denied. Id. at 68.
Toronto-Dominion is factually distinct and thus not persuasive here. First, the court's ruling is in reference to what the potential intervenor may do, or not do, in the appeal filed by the formal party. The court did not rule on whether the potential intervenor could have filed a motion in the case itself. Second, the court's ruling was influenced by the fact that the lower court had specifically reserved ruling on the motion to intervene. This is not the case here. The motion to amend filed by the former Blinder Robinson attorneys was filed before the judgment had been appealed by any of the formal parties and, while the motion to intervene had not yet been granted or denied, the court had not reserved ruling on it.
The trustee also relies on the wording of Bankruptcy Rule 8002(b) in support of his argument. The trustee contends that, given the wording of 8002(b), only "a party" may file one of the time-extending motions listed. The trustee contends that the former Blinder Robinson attorneys were not parties and consequently they could not file a time-extending motion, such as their motion to amend.
However, whether the former Blinder Robinson attorneys were parties or not, once they filed their motion to amend, Rule 8002(b) suspended the time for filing a notice of appeal until the motion to amend had been granted or denied. This would include the court's denial of the motion based on a lack of standing. Thus, while resolution of the question of the former Blinder Robinson attorneys' standing is important in its own right, it is not dispositive of whether the attorneys' motion to amend tolled the period for filing a notice of appeal. See Charles v. Daley, 799 F.2d 343 (7th Cir.1986) (). Until the decision on the attorneys' motion to amend was made...
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