Chase Bank USA N.A. v. Edward Cherry
MEMORANDUM ORDER Denying 136 MOTION to Stay and certify interlocutory appeal filed by Edward Cherry. Signed by Judge Leonard P. Stark on 9/26/11. (ntl)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
CHASE BANK USA, N.A.
Civ. No. 08-121-LPS
LAURA L. HESS,
EDWARD CHERRY alk/a
EDWARD T. KENNEDY,
HOME PLATE CONSULTANTS, LLC,
SELF MADE LLC,
THE CONSUMER LAW CENTER OF DELRAY
BEACH, LLC, and
THE CONSUMER LAW CENTER OF BOCA
At Wilmington this 26th day of September, 2011:
Presently pending before the Court is a motion to stay and certifY interlocutory appeal
filed by Defendant Edward Cherry ("Cherry"). (DJ. 136) For the reasons that follow, the Court
will deny Cherry's motion.
Plaintiff Chase Bank USA, N.A. ("Chase") filed this action alleging Cherry and his co
defendants caused Chase credit card members to withhold outstanding debt by operating an
unlawful debt elimination scheme. (D.1. 1) Chase seeks declaratory and injunctive relief based
on causes of action for tortious interference with contractual relations, unjust enrichment, abuse
of process, conspiracy, violations of the Delaware Deceptive Trade Practices Act, 6 Del. C. §§
2531 et seq., and violations of the Delaware Consumer Fraud Act, 6 Del. C. §§ 2511 et seq. (Id)
On November 23, 2009, Cherry filed a motion to dismiss, arguing that the doctrine of res judicata
bars Chase's claims against him. (D.I. 84) On January 6, 2011, the Court denied Cherry's
motion to dismiss. (D.I. 131)
Subsequently, on January 21,2011, Cherry filed the instant motion to stay and certify an
interlocutory appeal. (D.I. 136) Chase opposes this motion. (D.I. 139) The parties completed
briefing on this motion on February 22,2011. (D.I. 142)
The decision of whether to grant leave to file an interlocutory appeal is "informed by the
criteria set forth in 28 U.S.c. § 1292(b)." In re Philadelphia Newspapers, LLC, 418 B.R. 548,
556 (E.D. Pa. 2009). Under the standards of § 1292(b), an interlocutory appeal is permitted only
when the order at issue (1) involves a controlling question of law upon which there is
(2) substantial grounds for a difference of opinion as to its correctness, and (3) if appealed
immediately may materially advance the ultimate termination of the litigation. See 28 U.S.C.
§ 1292(b); see also Katz v. Carte Blanche Corp., 496 F.2d 747, 754 (3d Cir. 1974). Moreover,
entertaining an interlocutory appeal under § 1292(b) is appropriate only when the party seeking
leave to appeal "establishes [that] exceptional circumstances justify a departure from the basic
policy of postponing review until after the entry of final judgment." In re Del. and Hudson Ry.
Co., 96 B.R. 469, 472-73 (D. Del. 1989), affd, 884 F.2d 1383 (3d Cir. 1989). In part, this stems
from the fact that "[p]iecemeallitigation is generally disfavored by the Third Circuit." In re
SemCrude, 2010 WL 4537921, at *2 (D. Del. Oct. 26, 2010) (citing In re White Beauty View,
Inc., 841 F.2d 524,526 (3d Cir. 1988».
Finally, "these three criteria do not limit the Court's discretion to grant or deny an
interlocutory appeal." In re SemCrude L.P., 407 B.R. 553, 557 (D. Del. 2009). Leave to file an
interlocutory appeal may be denied for "entirely unrelated reasons such as the state of the
appellate docket or the desire to have a full record before considering the disputed legal issue."
Katz, 496 F.2d at 754.
Controllin& Ouestion of Law
For the purpose of certifying an interlocutory appeal, a "controlling question of law" is
"one which would result in a reversal of a judgment after final hearing." Katz, 496 F .2d at 47.
Cherry contends that the question of "whether a sole proprietorship has a separate legal identity
separate from that of the individual who owns it such that if the sole proprietorship was a named
party to the settlement and release agreement the owner of the sole proprietorship was a party to
the settlement and release agreement" is a controlling issue of law in this case. (D.I. 136 at 7) In
support ofthis proposition, Cherry contends that, in its opinion, the Court "implicitly determined
that the owner of a sole proprietorship has a distinct and separate legal existence from the
proprietorship itself." (ld. at 4)
Chase responds that Cherry "grossly mischaracterizes the Court's Opinion." (D.!. 139 at
3) Defendant asserts that the Court did not come to any conclusion regarding the general status
of a sole proprietorship vis-a-vis its owner. (Id.)
The Court agrees with Chase that it did not make any findings of fact or law related to the
issue Cherry seeks to have certified for interlocutory appeal, namely, whether a sole
proprietorship has a separate identity from that of the individual who owns it. The only mention
of this issue in the Court's Opinion was:
In his Reply Brief, Defendant Cherry asserts that "[i]n Florida and
Delaware there is no legal separation between a sole proprietorship
and its owner." He goes on to state that "Chase released the
Consumer Recovery Team from liability and accepted in excess of
$4,000,000 supporting the release." However, Defendant Cherry
offers no citations for the legal proposition he asserts, nor does he
explain how this factual assertion regarding the Consumer
Recovery Team relates to his argument. Accordingly, the Court
finds Defendant Cherry's arguments insufficient to establish the
requirements of res judicata.
(D.L 131 at 7 n.l) (internal citations omitted)
Because the Court made no factual or legal finding with respect to this issue, Cherry's
motion seeks appellate resolution of a speculative issue that is not controlling in this case. The
Third Circuit has explicitly stated that 28 U.S.C. § 1292(b) "is not intended to grant the appellate
courts power to give advice on speculative matters." Link v. Mercedes-Benz a/North America,
Inc., 550 F.2d 860,863 (3d Cir. 1976). Therefore, the Court is not persuaded that Cherry has
raised a controlling question of law.
Given the Court's conclusion that Cherry has not raised a controlling question oflaw, it is
not necessary also to determine whether there are substantial grounds for a difference of opinion
and whether an immediate appeal would materially advance the termination of the litigation. The
Court does note, however, that Cherry has failed to present exceptional circumstances justifYing
the need for immediate review. See DeLalla v. Hanover Ins., 2010 WL 3908597, at *3 (D.N.J.
Sept. 30, 2010) ("Interlocutory appeal is meant to be used sparingly and only in exceptional cases
where the interests cutting in favor of immediate appeal overcome the presumption against
piecemeal litigation."). The Court does not find any "circumstance or reason that distinguishes
the case from the procedural norm and establishes the need for immediate review." In re Magic
Rests., Inc., 202 B.R. 24, 26-27 (D. Del. 1996). Thus, the Court concludes that an interlocutory
review of its January 6, 2011 Order is not warranted.
For the above reasons, IT IS HEREBY ORDERED that Cherry's Motion to Stay and
Certify Interlocutory Appeal (D.I. 136) is DENIED.