In re Richards, Bankruptcy No. 97-01501. Adversary No. 97-0090.
| Decision Date | 01 December 1999 |
| Docket Number | Bankruptcy No. 97-01501. Adversary No. 97-0090. |
| Citation | 241 BR 769 |
| Court | United States Bankruptcy Courts – District of Columbia Circuit |
| Parties | In re Nancy B. RICHARDS, Debtor. Lindner & Associates, P.C., Plaintiff, v. Nancy B. Richards, Defendant. |
Paul D. Pearlstein, Washington, DC, for defendant.
Brian R. Seeber, Brian R. Seeber, P.C., Washington, DC, for plaintiff.
Roger Schlossberg, Hagerstown, MD, for Brian R. Seeber.
The district court recently affirmed this court's monetary judgment awarding sanctions in the defendant's favor. The defendant has moved for a release of the moneys deposited as a supersedeas bond staying enforcement of the judgment pending the appeal to the district court under F.R.Bankr.P. 7062. The plaintiff opposes that motion, and has cross-moved to extend the previous stay to include the appeal of the district court's judgment to the court of appeals, with the existing deposit to serve as a supersedeas bond for that purpose.
The defendant contends that the bankruptcy court lacks authority to consider the plaintiff's request for a stay pending an appeal to the court of appeals.1 The court's examination of that issue has caused the court to question as well whether the appeal in the district court is sufficiently concluded to permit this court to release the supersedeas funds.
The court will deny both the motion to release the supersedeas funds and the cross-motion for a further stay. The district court's continued appellate jurisdiction by reason of its failure to issue a mandate means that the appeal is not yet concluded, but this by itself does not bar this court's considering a request for a stay pending a further appeal. See part II, below. But the court nevertheless concludes that it lacks authority to issue a stay of its affirmed judgment pending an appeal to the court of appeals: the district court and the court of appeals are the appropriate courts from which to seek a stay under F.R.Bankr.P. 8017. See part III, below. However, the district court's continued appellate jurisdiction means that enforcement of the supersedeas bond is premature. See part IV, below.
Bankruptcy appeals "shall be taken in the same manner as appeals in civil proceedings generally are taken to the courts of appeals from the district courts." 28 U.S.C. § 158(c)(2). Thus, a district court's affirmance of a bankruptcy court's judgment is generally analogous to a court of appeals' affirmance of a district court's judgment in ordinary civil litigation. See Payne v. Clarendon Nat'l Ins. Co. (In re Sunset Sales, Inc.), 195 F.3d 568, 570-571 (10th Cir.1999)( that a court hearing an appeal from a bankruptcy court acts as an appellate court and "is therefore more analogous to a circuit court" hearing an appeal from a district court). So it is relevant to examine the case law regarding the analogous question of obtaining a stay of a district court judgment in non-bankruptcy litigation, after the judgment has been affirmed by the court of appeals (that is, a stay pending a petition for a writ of certiorari to the Supreme Court).
The district court loses appellate jurisdiction once it issues a mandate. See Sunset Sales, 195 F.3d at 570-571. Our district court's local rules do not address when or how the mandate is to be issued. Compare Sunset Sales, 195 F.3d at 571-572 (). Under 28 U.S.C. § 158(c)(2), the court could analogize from the mandate-issuance rule that applies when a district court's monetary judgment is affirmed by the court of appeals. The applicable rule is F.R.App.P. 41 which provides in pertinent part:
But the district court here has not issued a certified copy of its opinion and judgment, so a mandate has never issued.2 Thus, the case is still technically within the appellate jurisdiction of the district court.
Although the district court has not issued its mandate, the resultant continued appellate jurisdiction of the district court is not a bar to this court's considering granting a stay. The rule used to be that once the appellate court obtained jurisdiction over an appeal, the trial court was without authority to modify the supersedeas that the trial court had approved; only the appellate court was vested with control over the supersedeas during the pendency of the appeal. Draper v. Davis, 102 U.S. 370, 26 L.Ed. 121 (1880); Darrow v. Kulp (In re Federal Facilities Realty Trust), 227 F.2d 651 (7th Cir.1955). But that rule has not survived the abolition of former F.R.Civ.P. 73(e) in 1968. In re Ridgemont Apartment Assocs., Ltd., 93 B.R. 788, 791 (Bankr.N.D.Ga.1988).
One court has held that an appeal pending in the district court or bankruptcy appellate panel divested a bankruptcy court of jurisdiction to issue a stay of a financing order after the bankruptcy court had initially declined to grant a stay pending appeal. In re Adams Apple, Inc., 829 F.2d 1484, 1489 (9th Cir.1987). But Adams Apple is inconsistent with Newton v. Consolidated Gas Co., 258 U.S. 165, 177, 42 S.Ct. 264, 66 L.Ed. 538 (1922), which stated:
Undoubtedly, after appeal the trial court may, if the purposes of Justice require, preserve the status quo until decision by the appellate court. But it may not finally adjudicate substantial rights directly involved in the appeal.
(Citations omitted.)3 Indeed, Adams Apple is inconsistent with United States v. El-O-Pathic Pharmacy, 192 F.2d 62 (9th Cir.1951), an earlier decision of the same court, which followed Newton.4 Furthermore, the cases Adams Apple relied upon are distinguishable from the instant case.5 In any event, Adams Apple undoubtedly would not be followed in this circuit. See Goldsborough v. Marshall, 243 F.2d 240, 244 (D.C.Cir.1957)(following Newton). So the appellate jurisdiction of the district court is not a bar to this court's modifying or enlarging the stay it has already granted.
The court thus turns to the different and more difficult question of whether the bankruptcy court has authority to issue a stay once its judgment is affirmed by the district court.
With respect to stays of district court judgments in non-bankruptcy litigation, one court has stated that "even where a district court arguably has the power to grant an injunction staying execution of a judgment pending a petition for certiorari, absent extraordinary circumstances, the court of appeals is the appropriate forum to hear the application." Cementos Guadalajara, S.A. v. United States, 727 F.Supp. 614, 617-18 (Ct.Int'l Trade 1989). Numerous other decisions hold that the district court has no authority to enter a stay after the appeal is resolved by the court of appeals. In re Stumes, 681 F.2d 524, 525 (8th Cir.1982)(court of appeals judgment directing issuance of writ of habeas corpus); Brinkman v. Department of Corrections, 857 F.Supp. 775, 776 (D.Kan.1994)(monetary judgment affirmed by court of appeals); Gander v. FMC Corp., 733 F.Supp. 1346 (E.D.Mo. 1990)(same); Mister v. Illinois Cent. Gulf R.R. Co., 680 F.Supp. 297, 298 (S.D.Ill.1988)(reversal in part and remand); Hovater v. Equifax Services, Inc., 669 F.Supp. 392, 393 (N.D.Ala.1987)(reversal and remand for dismissal of action); Studiengesellschaft Kohle, mbH v. Novamont Corp., 578 F.Supp. 78, 79 (S.D.N.Y.1983)(judgment awarding defendant an offset reversed and matter remanded to restore the full award to the plaintiff and to reconsider award of costs); Kozman v. Trans World Airlines, Inc., 145 F.Supp. 140 (S.D.N.Y.1956)(monetary judgment affirmed by court of appeals). But see Keyes v. United States Fidelity & Guar. Co., 44 F.Supp. 723 (S.D.Fla.1942). See generally E.L. Kellett, Annotation, CONSTRUCTION, IN CIVIL CASE, OF 28 U.S.C.A. § 2101(F), PROVIDING FOR STAY OF EXECUTION OR ENFORCEMENT OF JUDGMENT SUBJECT TO REVIEW BY UNITED STATES SUPREME COURT ON CERTIORARI, 2 A.L.R. FED. 657 (1969). The rationales of these decisions suggest that a similar rule ought to apply in an appeal of an affirmance of a bankruptcy court judgment. These decisions follow two approaches.
The court in Cementos Guadalajara based its holding on a review of the rules governing stays of an appellate court's mandate, namely, F.R.App.P. 416 and former Supreme Court Rule 44.2.7 These rules contemplate that after entry of the court of appeals' judgment, an application for further stay will be sought from the court of appeals or from the Supreme Court. They give the district court no role in deciding whether a stay should continue.8
This rationale is questionable. Staying a mandate is distinct from staying a judgment. Staying the mandate would maintain the appellate court's jurisdiction over the case. But staying issuance of the appellate court's mandate does not effect a stay of the trial court's judgment. Deering Milliken, Inc. v. FTC, 647 F.2d 1124, 1129 (D.C.Cir.1978); Payne v. Clarendon Nat'l Ins. Co. (In re Sunset Sales, Inc.), 222 B.R. 914, 918 n. 4 (10th Cir. BAP 1998), aff'd, 195 F.3d 568 (10th Cir.1999).
Although F.R.App.P. 41 does not address the question of a stay of the district court's judgment after an affirmance and pending a writ for certiorari, the court of appeals (absent express authority elsewhere) would have authority to grant a stay under the All Writs Act, 28 U.S.C. § 1651.9 See Magnum Import...
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