Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

The Bankruptcy StrategistFeaturesBankruptcyLitigation

Third Circuit Clarifies Appeal Process in Settlement and Reorganization Plan Disputes

By Michael L. Cook
September 01, 2019

The Third Circuit recently took a "pragmatic approach" when affirming lower court orders denying a stay of bankruptcy settlement distributions pending appeal. In re S.S. Body Armor I, Inc., 2019 WL 2588533 (3d Cir. June 25, 2019). After holding that the district court's "stay denial order" was "final" for jurisdictional purposes, it also confirmed "the applicable standard of review" on motions for stays pending appeals.

Relevance

The Third Circuit's jurisdictional ruling was timely. First, the Circuit had "no direct precedent on the finality of the" order before it. Second, the U.S. Supreme Court recently granted certiorari in Ritzen Group, Inc., v. Jackson Masonry, LLC, 2019 WL 266853 (May 20, 2019), agreeing to address whether an order denying relief from the automatic stay is "final" under the bankruptcy appeals statute, 28 U.S.C. §158(a)(i). The Sixth Circuit had held in Jackson that an order denying stay relief was "final," rejecting "vague" and "unpredictable" tests adopted by other circuits. 906 F.3d 494, 498 (6th Cir. 2018), citing In re Atlas IT Export Corp., 761 F.3d 177, 185 (1st Cir. 2014)("Everything depends on the circumstances …").

A party appealing from a bankruptcy court's approval of a settlement or confirmation of a reorganization plan must ordinarily seek a stay pending appeal. Otherwise, as the Third Circuit noted in Body Armor, if the "settlement proceeds are distributed before resolution of" the appeal, "that appeal is 'all but assured' to become moot." Id. at 3, quoting In re Revel AC, Inc., 802 F.3d 558, 567 (3d Cir. 2015).

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
The DOJ's Corporate Enforcement Policy: One Year Later Image

The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.

The Bankruptcy Hotline Image

Recent cases of importance to your practice.

Use of Deferred Prosecution Agreements In White Collar Investigations Image

This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.

How AI Has Affected PR Image

When we consider how the use of AI affects legal PR and communications, we have to look at it as an industrywide global phenomenon. A recent online conference provided an overview of the latest AI trends in public relations, and specifically, the impact of AI on communications. Here are some of the key points and takeaways from several of the speakers, who provided current best practices, tips, concerns and case studies.

The DOJ's New Parameters for Evaluating Corporate Compliance Programs Image

The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.