Timing and finality requirements for appealing federal court receivership orders

Blog Post

The normal rule in federal court litigation generally is that the parties have to wait until the case is complete — final judgment — before having a right to appeal. Under this “final judgment rule,” interlocutory orders — orders that do not end the case — are generally not immediately appealable. Rather, parties have to wait for final judgment. The meaning of a final judgement is less than clear. In general, appeal may be taken only from a final judgment or order disposing of all claims against all parties, and leaving nothing for the district court to do but execute the judgment. 28 U.S.C. § 1291. A judgment that concludes the case for only some parties or claims is not a final judgment for purposes of appeal.

An appeal of a final judgment is known as an “appeal as of right.” In order to appeal a judgment or order that is not final, the would-be appellant must obtain permission from the appellate court. This is known as an “appeal by permission.” A party generally must appeal as of right either within 30 days after entry of the order or judgment from which it is appealing or  within 60 days after entry of the order or judgment, if any of the following is a party to the case - the United States, a federal agency, or a federal officer or employee sued in connection with the officer’s official duties. If one party timely files a notice of appeal, the deadline for any other party to file a notice of appeal is the later of 14 days after the filing of the first notice of appeal or the end of the applicable 30- or 60-day period described above.

There are, however, a number of exceptions to the final judgment rule. Certain of these exceptions are discussed below:

28 U.S.C. § 1292(a)(2)

One such exception applies in federal court receivership cases. In federal court, the court of appeals has jurisdiction over appeals from interlocutory orders “appointing receivers or refusing orders to wind up receiverships or to take steps to accomplish the purposes thereof, such as directing sales or other disposals of property.”  28 U.S.C. § 1292(a)(2). Section 1292(a)(2) is strictly construed to permit interlocutory appeals only from orders that fall within one of the three categories. The statute permits immediate review of the conduct of appointed receivers only when there has been a complete failure to act in furtherance of the receivership, but does not vest the court of appeals with jurisdiction to undertake ongoing supervision of every action a receiver might be ordered to take.  An order entered in an equity receivership proceeding that does not “finally resolve[] the parties’ rights to [the receivership] assets” is not a final order. FTC v. Overseas Unlimited Agency, Inc.873 F.2d 1233, 1234-35 (9th Cir. 1989). In addition, an order denying a motion to dismiss receivership was not a final order. See, Morrison- Knudsen Co. v. CHG Int’l, Inc., 811 F.2d 1209, 1214 (9th Cir. 1987).

Collateral Order Doctrine

The U.S. Supreme Court established the Collateral Order Doctrine in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546 (1949). The Doctrine allows appeals from a small class of orders which finally determine claims of right separable from, and collateral to, rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated. For an order to be appealable under the Collateral Order Doctrine, it must: (i) conclusively determine the disputed question; (ii) resolve an important issue completely separate from the merits of the action; and (iii) be effectively unreviewable on appeal from a final judgment.

A litigant asserting that an issue is “important” under the second requirement faces a high burden. The Supreme Court has held that an issue is not sufficiently important unless delaying review until the entry of a final judgment would imperil a substantial public interest or some particular value of a high order. See, Mohawk Indus., Inc. v. Carpenter, 558 U.S. 100, 107 (2009).  In Mohawk, a party requested to keep information sealed under the attorney-client privilege. The trial court ordered the information revealed, rejecting the party’s request for confidentiality. The party sought to appeal under the Collateral Order Doctrine, but the Supreme Court rejected the appeal. The Court said that the question of privilege could be reviewed effectively at the end of the case. The Collateral Order Doctrine is intentionally designed to apply in a limited number of cases. The Supreme Court has stated that the Collateral Order Doctrine must never be allowed to swallow the general rule that a party is entitled to a single appeal, to be deferred until final judgment has been entered.

One example of the applicability of the Collateral Order Doctrine is where a district court decides to abstain where the effect is to send the parties out of federal court.  In the receivership context the Sixth Circuit and Fifth Circuit have held that a court order resolving some claims to receivership assets was an appealable, collateral order. See, SEC v. Basic Energy & Affiliated Res., Inc., 273 F.3d 657, 665-67 (6th Cir.2001); SEC v. Forex Asset Mgmt. LLC, 242 F.3d 325, 330-31 (5th Cir.2001).

Doctrine of Practical Finality

The U.S. Supreme Court established the Doctrine of Practical Finality in Forgay v. Conrad, 47 U.S. 201 (1848). The Doctrine of Practical Finality permits review of an order that decides the right to the property in contest, and directs it to be delivered up by the defendant to pay a certain sum of money to the complainant. The order must direct immediate execution and subject the losing party to irreparable harm if appellate review is delayed until conclusion of the case. The Doctrine of Practical Finality is a narrow exception to the final judgment rule.

Explicit Grant or Denial of an Injunction

Section 1292(a)(1) confers appellate jurisdiction over interlocutory orders “granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions, except where a direct review may be had in the Supreme Court.” While this language would appear to allow an immediate appeal from virtually any order related to a request for injunctive relief, the Supreme Court has cautioned that §1292(a)(1) should be approached “somewhat gingerly lest a floodgate be opened.” Switzerland Cheese Ass’n v. E. Horne’s Market, Inc., 385 U.S. 23, 24 (1966). To avoid opening these floodgates, the federal courts have limited the reach of §1292(a)(1) by carefully defining injunctive orders to include only those that: (1) are directed to a party; (2)  are enforceable by contempt; and (3) grant or deny part or all of the ultimate relief sought in the litigation.

The Third Circuit has ruled that an “order requiring the delivery of certain deposits to [a] receiver is neither final nor within any category of appealable orders.” United States v. Chelsea Towers404 F.2d 329, 330 (3d Cir. 1968). This determination is in accord with the holdings of three other circuits. See, e.g., FTC v. Overseas Unlimited Agency, Inc.873 F.2d 1233, 1235 (9th Cir. 1989) (holding that a turnover order is not (1) a final order under 28 U.S.C. § 1291; (2) an injunction under 28 U.S.C. § 1292(a)(1); or (3) within the bounds of 28 U.S.C. § 1292(a)(2) ); United States v. Beasley558 F.2d 1200, 1201 (5th Cir. 1977); Waylyn Corp. v. Casalduc219 F.2d 888 (1st Cir. 1955).

Writ of Mandamus

Courts have used mandamus to confine an inferior court to a lawful exercise of its prescribed jurisdiction or to compel it to exercise its authority when it is its duty to do so.  Courts have held that mandamus constitutes a drastic remedy that a court should grant only in extraordinary circumstances in response to an act amounting to judicial usurpation of power. Three conditions must be satisfied for the issuance of a writ of mandamus: (1) there must be no other adequate means to attain the relief sought; (2) the right to issuance of the writ must be clear and indisputable; and (3) the issuing court, in the exercise of its discretion, must be satisfied that the writ is appropriate under the circumstances. Cheney v. United States Dist. Court542 U.S. 367, 380-81 (2004). A court of appeal is free to turn down any writ petition, even one that clearly has merit, and the court of appeal denies the overwhelming majority of petitions for writ of mandamus seeking review of trial court orders. 

Related Services

Jump to Page

McDonald Hopkins uses cookies on our website to enhance user experience and analyze website traffic. Third parties may also use cookies in connection with our website for social media, advertising and analytics and other purposes. By continuing to browse our website, you agree to our use of cookies as detailed in our updated Privacy Policy and our Terms of Use.