Kenneth Frank, et al v. Maria Yip

Filing

Opinion issued by court as to Appellants El Mar Associates, Inc., Kenneth A. Frank and Oceanside Lauderdale, Inc.. Decision: Affirmed. Opinion type: Non-Published. Opinion method: Per Curiam. The opinion is also available through the Court's Opinions page at this link http://www.ca11.uscourts.gov/opinions.

Case: 16-12056

Date Filed: 12/20/2016

Page: 1 of 6

[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 16-12056
Non-Argument Calendar
________________________
D.C. Docket No. 0:15-cv-60732-WJZ,
Bkcy No. 0:13-bkc-23165JKO

In re: OCEAN 4660, LLC.,
Debtor.
__________________________________________________________________
KENNETH A. FRANK,
OCEANSIDE LAUDERDALE, INC.,
EL MAR ASSOCIATES, INC.,
Plaintiffs-Appellants,
versus
MARIA YIP,
Defendant-Appellee.

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Date Filed: 12/20/2016

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________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(December 20, 2016)
Before HULL, MARTIN and ANDERSON, Circuit Judges.
PER CURIAM:
Appellants Kenneth A. Frank, Oceanside Lauderdale, Inc. (“Oceanside”),
and El Mar Associates, Inc. (“El Mar”) appeal the district court’s judgment
affirming the bankruptcy court’s order resolving a disputed Chapter 7 trustee
election pursuant to 11 U.S.C. § 702. After review, we affirm. 1
As a threshold matter, we address Appellee Maria Yip’s contention that we
lack jurisdiction to hear this appeal because the bankruptcy court’s order is not a
final decision under 28 U.S.C. § 158(d)(1). “Although a district court, at its
discretion, may review interlocutory judgments and order of a bankruptcy court,
see 28 U.S.C. § 158(a), a court of appeals has jurisdiction over only final
judgments and orders entered by a district court or a bankruptcy appellate panel
sitting in review of a bankruptcy court, see § 158(d).” In re Celotex Corp., 700

1

We review our appellate jurisdiction de novo. In re Donovan, 532 F.3d 1134, 1136
(11th Cir. 2008). As “the second appellate court to review” the bankruptcy court, we “assess the
bankruptcy court’s judgment anew, employing the same standard of review the district court
itself used.” In re Failla, 838 F.3d 1170, 1174 (11th Cir. 2016). Accordingly, we review the
bankruptcy court’s conclusions of law and mixed questions of law and fact de novo and its fact
findings for clear error. In re Cox, 493 F.3d 1336, 1340 n.9 (11th Cir. 2007).
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F.3d 1262, 1265 (11th Cir. 2012) (quotation marks omitted); see also 28 U.S.C.
§ 158(d)(1) (“The courts of appeals shall have jurisdiction of appeals from all final
decisions, judgments, orders, and decrees entered” by the district court under
subsection (a)). While a final decision generally “is one which ends the litigation
on the merits and leaves nothing for the court to do but execute the judgment,” In
re Celotex Corp., 700 F.3d at 1265, this Court has concluded that “[f]inality is
given a more flexible interpretation in the bankruptcy context . . . because
bankruptcy is an aggregation of controversies and suits.” In re Donovan, 532 F.3d
1134, 1136 (11th Cir. 2008). Thus, “[i]n the bankruptcy context, this Court has
concluded that it is generally the particular adversary proceeding or controversy
that must have been finally resolved rather than the entire bankruptcy litigation.”
In re Walker, 515 F.3d 1204, 1210 (11th Cir. 2008).
This Court has held that an order removing or appointing a Chapter 7 trustee
is a final order. See id. at 1210-11 & n.4 (reviewing a bankruptcy court’s order
removing a permanent trustee for an undisclosed conflict of interest). In so doing,
we acknowledged a split among the Circuits on this issue and concluded that we
were “persuaded by the logic” of the Third Circuit in In re Marvel Entertainment
Group, Inc., 140 F.3d 463, 470-71 (3d Cir. 1998), as follows:
In that case, the court wrote that the purpose of the finality
requirement is judicial economy but that judicial efficiency would be
turned on its head if the court were to delay reviewing the trustee
appointment until after the entire bankruptcy proceeding concluded.
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The court [in In re Marvel] noted that liberal finality considerations in
orders appointing bankruptcy trustees are necessary because these
orders cannot be meaningfully postponed to the bankruptcy’s
conclusion. The [In re Marvel] court wrote that if it did not have
jurisdiction no meaningful review of the order appointing the trustee
could ever take place. It would strain credulity to suggest that a
reviewing court would jettison years of bankruptcy infighting,
compromise, and final determinations solely for the purpose of
reversing on the issue of the identity of the trustee.
Id. at 1210-11 & n.5 (quotation marks, alterations and citations omitted).
Here, at an initial meeting of the debtor’s three creditors, two of the
creditors—Appellants El Mar and Oceanside—requested the election of a
permanent trustee. Over the objection of the third creditor, Comerica Bank, and
the interim trustee, Appellee Yip, Appellants El Mar and Oceanside nominated and
elected William Brandt to serve as trustee. After a hearing on the disputed
election, the bankruptcy court entered an order that: (1) concluded that no valid
election took place because Appellants El Mar and Oceanside were ineligible
under 11 U.S.C. § 702(a)(1) and Bankruptcy Rule 2003(b)(3) to request the
election because their claims were disputed; and (2) appointed Appellee Yip to
serve as the permanent Chapter 7 trustee.
Appellants then appealed to the district court. The district court affirmed the
bankruptcy court’s order, concluding that Appellants El Mar and Oceanside “were
not entitled to participate in election of the Chapter 7 trustee,” and therefore “no
valid election took place, leaving Maria Yip as trustee for the case.”

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Based on our binding precedent in In re Walker, we conclude that the district
court’s decision, which affirmed the bankruptcy court’s order resolving the
election dispute and appointing Appellee Yip as the Chapter 7 permanent trustee,
was a “final decision” within the meaning of 28 U.S.C. § 158(d)(1). See id. at
1210-11.
Appellant Yip cites decisions from other Circuits, In re Klein, 940 F.2d 1075
(7th Cir. 1991), and In re St. Charles Preservation Investors, Ltd., 916 F.2d 727
(D.C. Cir. 1990), both of which fall on the other side of the Circuit split
acknowledged in In re Walker. 2 Indeed, the Third Circuit in In re Marvel, with
which In re Walker expressly agreed, explicitly rejected the position of the Seventh
and D.C. Circuits on this finality issue. See In re Marvel, 140 F.3d at 470. In
short, we are bound by our prior precedent in In re Walker. See Smith v. GTE
Corp., 236 F.3d 1292, 1300 n.8 (11th Cir. 2001) (“Under the well-established prior
panel precedent rule of this Circuit, the holding of the first panel to address an
issue is the law of this Circuit, thereby binding all subsequent panels unless and

2

As Appellants note, these two cases are also distinguishable in that the district court
orders reversed the bankruptcy courts’ rulings as to the trustee and remanded to the bankruptcy
court for further proceedings. See In re Klein, 940 F.2d at 1076-77; In re St. Charles Pres.
Inv’rs, Ltd., 916 F.2d at 728. Here, as in In re Walker, the district court affirmed the bankruptcy
court’s ruling as to the trustee. See In re Walker, 515 F.3d at 1213.
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until the first panel’s holding is overruled by the Court sitting en banc or by the
Supreme Court.”). 3
Having concluded that we have appellate jurisdiction, we affirm the district
court’s judgment based on its well-reasoned order filed on March 30, 2016.
AFFIRMED.

3

Appellee Yip also argues that Appellant Frank lacks standing to appeal because he did
not participate in the trustee election and thus is not a “person aggrieved” by the bankruptcy
court’s order. See Atkinson v. Ernie Haire Ford, Inc. (In re Ernie Haire Ford, Inc.), 764 F.3d
1321, 1325-26 (11th Cir. 2014). Because Appellee Yip does not dispute that Appellants
Oceanside and El Mar have the requisite standing, we need not resolve the issue of Appellant
Frank’s standing in order to entertain this appeal.
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