Cornerstone Staffing Solutions, Inc. v. James et al
Filing
297
ORDER by Judge Richard Seeborg denying 290 Motion to Amend/Correct. (cl, COURT STAFF) (Filed on 4/7/2014)
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IN THE UNITED STATES DISTRICT COURT
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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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SAN FRANCISCO DIVISION
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For the Northern District of California
United States District Court
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No. C 12-1527 RS
CORNERSTONE STAFFING
SOLUTIONS, INC., a California
corporation,
ORDER DENYING MOTION TO
CERTIFY PRIOR ORDER
Plaintiff,
v.
LARRY THAXTER JAMES, an individual,
et al.,
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Defendant.
____________________________________/
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I.
INTRODUCTION
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Pursuant to 28 U.S.C. § 1292(b), defendant Larry James requests certification for
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interlocutory review of the March 7, 2014 order on plaintiff CornerStone’s motion for summary
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judgment. In particular, James seeks to appeal the order’s determination that he is precluded—
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whether by lack of standing, or judicial estoppel, or both—from vindicating his claimed interest in
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CornerStone and various related counterclaims. Because James has not demonstrated “exceptional
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circumstances” warranting immediate, interlocutory appeal, the motion is denied. This matter is
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appropriate for resolution without oral argument pursuant to Civil Local Rule 7-1(b).
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II.
LEGAL STANDARD
As a general rule, a party may seek review of a district court’s rulings only after the entry of
final judgment. In re Cement Litig., 673 F.2d 1020, 1027 (9th Cir. 1982). The district court may
NO. C 12-01527 RS
ORDER
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under “exceptional” circumstances, however, certify an order for interlocutory review pursuant to 28
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U.S.C. § 1292(b). Id. at 1026 (citing Coopers & Lybrand v. Livesay, 437 U.S. 463, 475 (1978)
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(holding that “exceptional circumstances [must] justify a departure from the basic policy of
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postponing appellate review until after the entry of a final judgment”)). Certification may be
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appropriate where: (1) the order involves a controlling question of law; (2) as to which there is
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substantial ground for difference of opinion; and (3) an immediate appeal from the order may
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materially advance the ultimate termination of the litigation. 28 U.S.C. § 1292(b).
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III.
DISCUSSION
For the Northern District of California
James falls far short of clearing the high bar required for interlocutory review. His motion,
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United States District Court
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which suffers a litany of deficiencies too numerous to warrant addressing here, misses the mark at
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every step of the requisite § 1292(b) analysis. For purposes of resolving the motion, it is sufficient
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to note just a few fundamental shortcomings.
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It is difficult to glean what specific “controlling question of law” James seeks to certify for
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appeal. While his motion addresses standing and judicial estoppel generally, it also raises several
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other issues, some of which were simply not addressed (or were arguably decided in James’ favor)
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in the prior order. Although it is clear that James disputes the order’s conclusion that he cannot
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pursue several of his counterclaims or his interest in CornerStone, he does little to frame any
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controlling question of law for consideration. Moreover, as in his February 2013 supplemental
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brief, James conflates judicial estoppel and standing, making it all the more difficult to discern what
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specific questions he would seek to certify for appeal. His cleanest presentation of questions
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appears on Page 7, where James states:
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The Ninth Circuit does not appear to have ruled definitely on the specific issues
presented here:
(1) Does a debtor have standing to pursue post-petition interest in earnings
that were generated by debtor’s personal services? 11 U.S.C. § 541(a)(6)
(2) In a reopened bankruptcy, does the debtor lose standing to pursue claims
that accrue post-petition by failing to identify those claims in amended
schedules, including:
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Equitable claims (such as unjust enrichment) for profits and value
generated by post-petition personal services?
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Fraud claim; or
NO. C 12-1527 RS
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-
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California Labor Code Section 970 claim?
(3) What evidence of inadvertence or mistake is sufficient to preclude judicial
estoppel where the bankruptcy is reopened and schedules amended?
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(Motion to Amend Order to Certify Appeal, ECF No. 290, 7:9-21). As an initial matter, it not
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apparent that each of these questions address issues that were actually relevant to the challenged
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order. In any event, no matter how James poses his questions, there is not a “controlling” one in the
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bunch.
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A question of law is controlling if “resolution of the issue on appeal could materially affect
“was intended primarily as a means of expediting litigation by permitting appellate consideration
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For the Northern District of California
the outcome of the litigation in the district court.” Cement Litig., 673 F.2d at 1026. Section 1292(b)
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United States District Court
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during the early stages of litigation of legal questions which, if decided in favor of the appellant,
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would end the lawsuit.” United States v. Woodbury, 263 F.2d 784, 787 (9th Cir. 1959). While the
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challenged issue need not be dispositive of the entire lawsuit to be controlling, see Kuehner v.
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Dickinson & Co., 84 F.3d 316, 319 (9th Cir. 1996), this first step of § 1292(b) analysis “should, at a
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minimum, require that reversal have some immediate effect on the course of litigation and result in
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some savings of resources.” F.T.C. v. Swish Mktg., C 09-03814 RS, 2010 WL 1526483, *2 (N.D.
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Cal. Apr. 14, 2010) (citation omitted). For example, in Asis Internet Servs. v. Active Response Grp.,
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C 07-6211 TEH, 2008 WL 4279695 (N.D. Cal. Sept. 16, 2008), the defendant sought interlocutory
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review of the court’s holding that the plaintiffs had standing to pursue a claim under the CAN-
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SPAM Act. The district court concluded that the CAN-SPAM standing issue was a controlling
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question of law, reasoning that if the Ninth Circuit reversed, “the litigation would end.” Id. at *3.
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Similarly, in Yoshimoto v. O’Reilly Auto., Inc., C 10-05438 LB, 2011 WL 2669604 (N.D. Cal. July
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7, 2011), the defendant sought to appeal a ruling that, if reversed, would terminate the plaintiff’s
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case.
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Here, by contrast, James seeks to appeal an order finding that he is precluded from pursuing
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several of his counterclaims (or portions thereof). If this action were stayed pending appeal and the
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Ninth Circuit ruled in James’ favor, the litigation would not end; the scope of the upcoming trial
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would merely expand. Unlike in Yoshimito and Asis, there is no risk that in the absence of
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interlocutory review the court might proceed with a trial that never should have been held in the first
NO. C 12-1527 RS
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place. Moreover, immediate resolution of James’ questions would not avoid “needless expense and
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delay.” See Kuehner, 84 F.3d at 319. If anything, interlocutory review would further delay the
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upcoming trial, which will address numerous issues entirely unrelated to James’ failed
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counterclaims. In the event the Ninth Circuit was eventually to reverse the challenged order, a
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second trial can be held at that time.
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In short, there is no indication that certifying the prior order for appeal would “materially
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affect the outcome of the litigation in the district court.” Cement Litig., 673 F.2d at 1026.
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Accordingly, James fails to present a single “controlling question of law” that might warrant
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immediate review. Moreover, even if his motion were construed as properly framing a controlling
For the Northern District of California
United States District Court
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question of law, James falls far short of demonstrating that there is “substantial ground for
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difference of opinion” that would justify accelerated consideration by the Ninth Circuit. See 28
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U.S.C. § 1292(b). Finally, for many of the same reasons that interlocutory review would not save
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this litigation from needless expense and delay, certifying an immediate appeal would not
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“materially advance the ultimate termination of the litigation.” See id. (emphasis added).
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Accordingly, James fails to satisfy each of the three requirements for interlocutory review under §
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1292(b).
IV.
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CONCLUSION
James’ motion does not demonstrate that certification under § 1292(b) is warranted.
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Although James has not yet submitted a reply brief, there is no doubt that under these circumstances
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he cannot successfully invoke this “narrow exception to the final judgment rule.” Couch v.
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Telescope Inc., 611 F.3d 629, 633 (9th Cir. 2010). Accordingly, the motion is denied.
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The clerk is directed to terminate ECF No. 290 and vacate the hearing set for May 8, 2014.
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IT IS SO ORDERED.
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Dated: 4/7/14
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RICHARD SEEBORG
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UNITED STATES DISTRICT JUDGE
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NO. C 12-1527 RS
ORDER
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