Judge Richard G. Stearns: ELECTRONIC ORDER entered. The court agrees with Bankruptcy Trustee Mark G. DeGiacomo that at present it lacks jurisdiction to hear the appeal of Jordan and E6AACC977 was at one time a principal of the now-defunct Upper Crust Pizza chain. The Trustee brought an adversarial proceeding against the Tobinses to reclaim approximately $1.4 million that the Trustee alleges they misappropriated from Upper Crust between 2007 and 2012. The Tobinses moved for summary judgment in the Bankruptcy Court, arguing that the Trustee's fraudulent conveyance claims are barred by a settlement and release agreement they reached with agents of Upper Crust in 2012, shortly before Upper Crust declared bankruptcy. The Trustee countered, and the Bankruptcy Court agreed, that because the Trustee stood in the shoes of the unsecured creditors, the Trustee was not bound by the agreement. The Trustee also argued that the agreement was in any event a nullity because the signatories failed to obtain court approval to modify the outstanding injunctions prohibiting the transfer of assets, and failed to satisfy the preconditions of the release.Under 28 U.S.C. ?? 158(a), the district court has jurisdiction to hear appeals "(1) from final judgments, orders, and decrees;... and (3) with leave of court, from other interlocutory orders and decrees." The Bankruptcy Court's Order is not "final" within the meaning of ?? 158(a)(1). Although "[f]inality is viewed more flexibly in the bankruptcy context than it is in other civil litigation contexts... [t]he order in question must, however, conclusively determine the dispute." In re Am. Colonial Broad. Corp., 758 F.2d 794, 801 (1st Cir. 1985) (internal quotation marks and citation omitted). "The adversary proceeding initiated by the trustee's [ten] count complaint is the relevant judicial unit upon which our finality analysis focuses." In re Bank of New Eng. Corp., 218 B.R. 643, 647 (B.A.P. 1st Cir. 1998). Here, the Bankruptcy Court's Order did not conclusively resolve the adversarial proceeding on the merits of the fraudulent conveyance claims, and thus is not a reviewable final order.Nor have the Tobinses satisfied the requirements for an interlocutory review of the Bankruptcy Court's Order. There exists "a small class" of decisions, termed "collateral 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.
Id. at 649, quoting Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 546 (1949).To qualify as a reviewable collateral order, the summary judgment order... must have: (1) conclusively determined, (2) an important legal question, (3) completely separate from the merits of the primary action, and (4) be effectively unreviewable on appeal from a final judgment on the remaining counts.
Id. The Bankruptcy Court's Order does not qualify as a reviewable collateral order because it is capable of review as a part of the final judgment. "The Supreme Court has stated that, to qualify under [the unreviewable element], denial of the immediate appeal must 'render impossible any review whatsoever.'" Id., quoting United States v. Ryan, 402 U.S. 530, 533 (1971). Whether the settlement and release agreement bars the Trustee's claims is subject to review after a final decision on the merits of the fraudulent conveyance claims.Finally, the Tobinses have not demonstrated exceptional circumstances compelling the invocation of the court's discretionary review authority under ?? 158(c). To ascertain whether we should exercise our discretion to hear [the] appeal, we will consider whether (1) the "order involves a controlling question of law" (2) "as to which there is substantial ground for difference of opinion," and (3) whether "an immediate appeal from the order may materially advance the ultimate termination of the litigation."
Id. at 652 (citation omitted). The Tobinses have not shown that there is "substantial ground for difference of opinion" over the Trustee's ability to bring claims standing in the shoes of unsecured creditors. See In re Lowenstein, 312 B.R. 6, 12 (Bankr. D. Mass. 2004) ("Under section 544(b)(1) of the Bankruptcy Code, 'the trustee [or the debtor in possession pursuant to ?? 1107(a) may avoid any transfer of an interest of the debtor in property... that is voidable under applicable law by a creditor holding an unsecured claim that is allowable under section 502....' 11 U.S.C.A. ?? 544(b)(1). So long as such a creditor exists, the trustee may assert that creditor's avoidance rights for the benefit of the entire bankruptcy estate and all its creditors, not just for the benefit of that creditor in the amount of the creditor's claim." (citation omitted)). Given the uncertainty over the validity of the settlement and release agreement, it is also unlikely that a hypothetical reversal of the Bankruptcy Court's Order would "materially advance the ultimate termination of the litigation." For the foregoing reasons, the appeal is DISMISSED. (RGS, int2)
Judge Richard G. Stearns: ELECTRONIC ORDER entered. The Bankruptcy Court having DENIED the motion for reconsideration on September 8, 2016, the STAY is lifted in this case and the Trustee's briefing is due to this court by September 26, 2016. (Zierk, Marsha)
Judge Richard G. Stearns: ELECTRONIC ORDER entered granting 10 Motion to Stay this appeal pending the Bankruptcy Court's ruling on the Motion for Reconsideration filed by the E6AACC9 or FEBB4C7 in that court on August 1, 2016. The Trustee's appellee brief is due fourteen days after the Bankruptcy Court's ruling. The Trustee will notify the Bankruptcy Court that the appeal has been stayed pending the Bankruptcy Court's ruling on the motion for reconsideration. (Zierk, Marsha)
MOTION for Extension of Time to September 22, 2016 to File Response/Reply Brief of Chapter 7 Trustee by Mark G. DeGiacomo. (Attachments: # 1 Exhibit Exhibit A, # 2 Exhibit Exhibit B)(Leone, Anthony)
ELECTRONIC NOTICE issued requesting courtesy copy of Appellants' brief and attached exhibits (Dkt. #8). Counsel must submit a courtesy copy of this document (or documents) to the Clerk's Office by September 1, 2016. These documents must be clearly marked as a Courtesy Copy and reflect the document number assigned by CM/ECF. (Zierk, Marsha)
Judge Richard G. Stearns: ELECTRONIC ORDER entered granting 5 Motion for Extension of Time to File, a six-day extension to Thursday, August 25, 2016 to file Appellants Brief. Appellee is granted a corresponding six-day extension to Thursday, September 8, 2016 to file Appellees Brief. (Zierk, Marsha)
RESPONSE to Motion re 5 MOTION for Extension of Time to August 25, 2016 to File Appeal with certificate of service filed by Mark G. DeGiacomo. (Leone, Anthony)
STEARNS, D.J., ELECTRONIC Bankruptcy Scheduling Order, ENTERED. Appellant Brief due by 8/19/2016. Appellee Brief due by 9/2/2016. Appellant Reply Brief due by 9/16/2016. (Flaherty, Elaine)
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