Postscript on Equitable Mootness

In the September 2015 Issue of this newsletter, we discussed two recent decisions of the U.S. Courts of Appeal for the Third and Ninth Circuits narrowing the equitable mootness doctrine. See “Time To Revisit Equitable Mootness.” In both cases, the courts held that the appeals from Chapter 11 plan confirmation orders were not equitably moot because, among other things, the lender “diligently sought a stay” and the court could grant effective relief. In re Transwest Resort Properties, Inc., 791 F. 3d 1140, 1142 1 (9th Cir. 2015) (2-1) (appellate review would not unfairly affect “third parties or entirely unravel the plan.”); One2One Communications LLC, 2015 WL 4430302, *6 (3d Cir. July 21, 2015) (reversed district court's dismissal of confirmation order appeal on equitable mootness grounds;” [confirmed] Plan did not involve the issuance of any publicly traded securities, bonds or other circumstances that would make it difficult to retract the plan;” “limited evidence of potential third-party injury.”) Accord, In re Sagamore Partners, Ltd., 2015 WL 5091909 (11th Cir. Aug. 31, 2015) (“Requiring [debtor] to pay default rate interest is effective relief”; because such relief available, appeal held not equitably moot). We also noted the concurring opinion of Judge Krause in One2One Communications urging the entire court “to consider eliminating, or at the very least reforming equitable mootness.” Id. at *7.