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FRBP 8003 Leave to Appeal (Judge Gargotta)

Crescent Resources Litigation Trust v. Fields (March 2, 2012)
Issue: The Litigation Trust requested that the bankruptcy court certify three issues for direct appeal to the Fifth Circuit under § 28 U.S.C. § 158(d)(2): (1) whether, under Stern v. Marshall, the Court lacked authority to enter an order dismissing the Litigation Trust’s § 544 claims with prejudice for lack of standing, (2) whether §§ 544 and 550 causes of action in the Plan are sufficient to retain claims asserted under state fraudulent transfer law pursuant to § 544(b) without the additional reservation of “state fraudulent transfer law” claims, and (3) whether, if such additional reservations are required to assert a § 544(b) claim, those reservations were accomplished through the Plan and/or the Disclosure Statement. Alternatively, the Litigation Trust requested the Court grant leave to file an interlocutory appeal to the district court under Bankruptcy Rule 8003, and issue a stay of this adversary proceeding pending resolution of the appeal pursuant to 28 U.S.C. § 158(d)(2)(D).
Holding: The motion to certify the Stern issue for direct appeal pursuant to 28 U.S.C. § 158(d)(2)(A) was denied as the Stern issue was inappropriate for appeal and, therefore, certification. The motion to certify the two § 544 standing issues failed procedurally because the parties did not file the appropriate Official Form required by Rule 8001(f)(2)(B). The alternative request for leave to file an interlocutory appeal under Bankruptcy Rule 8003 was denied because the Stern issue was not appropriate for appeal and the Trust failed to meet the procedural requirements of Rule 8003. The Trust’s request for stay pursuant to § 158(d)(2)(D) was denied given that certification was denied; however, abatement was granted to the extent the parties agreed in their Certificate of Conference to an abatement of these adversary proceedings pending appeal.