In Re: Mary Veronica Santiago-Monteverde

Filing 11

MEMORANDUM AND ORDER denying 6 Motion for Leave to Appeal: For the foregoing reasons, appellee's motion for certification of a direct appeal to the Second Circuit (Dkt. No.6) is DENIED. Appellee Pereira may respond to appellant's brief within fourteen days from the issuance of this Memorandum and Order. (Signed by Judge P. Kevin Castel on 3/24/2014) (tn)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

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Inre

14 Civ. 1611 (PKC)

MARY VERONICA SANTIAGO-MONTEVERDE,

Chapter 7 Case No.
11-15494 (JMP)

Debtor.

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MARY VERONICA SANTIAGO-MONTEVERDE,

MEMORANDUM
AND ORDER

Appellant,
USDSSDNY

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DOCUMENT
JOHN S. PEREIRA,
Appellee.

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ELECTRONICALLY FILED
DOC#: _____________
DATE FILED:

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CASTEL, District Judge:
Jolm Pereira, the tlustee in the Chapter 7 bankruptcy case of debtor Mary
Veronica Santiago-Monteverde, moves under 28 U.S.c. § 158(d)(2)(A) to certify the debtor's
appeal from two orders entered by the bankruptcy COUlt on January 15, 2014 for an appeal
directly to the Second Circuit. The first of these orders denied Santiago-Monteverde's motion
under 11 U.S.C. § 706(a) to convert her case to one under Chapter 13 of the BanklUptcy Code.
The second authorized the sale of her rent-controlled lease pursuant to 11 U.S.C. § 363. An
earlier order in the same case held that the rent-controlled lease was not exempt from the
property of the bankruptcy estate. An appeal from that order is presently under submission with
the Second Circuit, and on JanualY 29,2014, that court stayed the two orders appealed fi-om here
pending the outcome of that appeal.

Santiago-Monteverde opposes Pereira's motion, asserting that this COUlt is
without jurisdiction to consider the request because it was filed after the deadline for such a
motion set forth in 28 U.S.C. § 158(d)(2)(E). While that section does require that a certification
request be made "not later than 60 days after the entry of the judgment, order, or decree"
appealed fi·om, the statute permits this Court to make a celiification detetmination "on its own
motion or on the request of a party." 28 U.S.C. § (d)(2)(A), (B)(i), (E). Because the
untimeliness of the motion appears partially attributable to a misunderstanding between the
parties as to whether the motion would be filed jointly, the Court will consider Pereira's request
on the merits.

The Bankmptcy Abuse Prevention and Consumer Protection Act of2005
("BAPCPA") amended section 158 of the Judicial Code to establish a procedure for the
certification of bankruptcy appeals directly to a Court of Appeals. See P.L. 109-8, 119 Stat. 23
(2005). As amended, section 158 grants jurisdiction to "the appropriate cOUli of appeals" if the
district court involved in the appeal certifies that:

(i) the judgment, order, or decree involves a question of law as to which there is
no controlling decision of the court of appeals for the circuit or of the Supreme
Court ofthe United States, or involves a matter of public importance;
(ii) the judgment, order, or decree involves a question oflaw requiring resolution
of conflicting decisions; or
(iii) an immediate appeal from the judgment, order, or decree may materially
advance the progress of the case or proceeding in which the appeal is taken;
and if the cOUli of appeals authorizes the direct appeal of the judgment, order, or
decree.

28 U.S.C. § 158(d)(2)(A). Pereira does not contend that either of the first two circumstances is
present in this case. Instead, he states that "[a]n immediate appeal from the Orders will

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materially advance the progress ofthe case." (Dkt. No.6 at 7). He contends that certifying a
direct appeal would speed resolution of the case and increase efficiency.

Upon reviewing the parties' submissions, this Comt concludes that none of the
three circumstances warranting certification under 28 U.S.c. § 158(d)(2)(A) is present here. In
particular, certification under subsection 158(d)(2)(A)(iii) is unwarranted for two reasons. First,
efficiency alone is not a proper reason for certification. See In re BGI, Inc., 504 B.R. 754, 765
(S.D.N.Y. 2014); see also Weber v. United States, 484 F.3d 154, 160 (2d Cir. 2007) ("Congress
was aware ofthe dangers ofleapfrogging the district court in the appeals process ... [and likely
recognized] the salutary effects of allowing some cases to percolate through the normal
channels."); In re Lehman Bros. Inc., 13 Civ. 5381 (DLC), 2013 WL 5272937 (S.D.N.Y. Sept.
18, 2013) ("if the mere expectation of advancement to a circuit court was sufficient to establish
material advancement, Section 158(d)(2)(A) would effectively eliminate the district court from
the bankruptcy review process altogether."). In providing the procedure for expedited appeals
under BAPCPA, "although Congress emphasized the importance of our expeditious resolution of
bankmptcy cases, it did not wish us to privilege speed over other goals .... " Id. at 160.

Second, the assumption that direct appeal will materially advance the progress of
the case is speculative. As the Second Circuit has recognized, "since district courts tend to
resolve bankruptcy appeals faster than the courts of appeals ... the cost in speed of pelmitting
district comt review will likely be small." Weber, 484 F.3d at 160. Here, the debtor's appeal of
the bankmptcy court's April 10, 2012 order has been fully briefed and argued before the Second
Circuit, while a direct appeal here would require a new round of briefing and argument. The
orders at issue in this appeal have been stayed by the Second Circuit pending the outcome ofthe
earlier appeal. While it is possible that the comt of appeals might accept a certified direct appeal

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and consolidate it with the earlier appeal, this is only one potential scenario. Moreover, should
the debtor prevail in the earlier appeal, her rent-controlled lease would be exempt from the
propelty of the bankmptcy estate and any issues relating to the sale of that lease would thus be
moot.

Thus, because Pereira has failed to demonstrate any of the three circumstances
warranting the certification of a direct appeal to the court of appeals under 28 U.S.C. §
158(d)(2)(A), this Court declines to so celtify the appeal either on Pereira's motion or on its own
motion.

CONCLUSION
For the foregoing reasons, appellee's motion for certification ofa direct appeal to
the Second Circuit (Dkt. No.6) is DENIED. Appellee Pereira may respond to appellant's brief
within fourteen days from the issuance of this Memorandum and Order.

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SO ORDERED.

United States District Judge

Dated: New York, New York
March 24, 2014

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