HDtracks.com, LLC v. 7digital Group PLC

Filing 54

ORDER denying 52 Motion for Certificate of Appealability. Accordingly, HDT's motion is DENIED. The parties are directed to comply with the February 6th Order by proceeding to discovery before Magistrate Judge Parker, and by filing a joint proposed case management order for the Court's approval no later than March 9, 2020. The Clerk of Court is directed to terminate the motion docketed at ECF No. 52. (As further set forth in this Order.) (Signed by Judge John F. Keenan on 2/20/2020) (cf)

Case 1:09-md-02013-PAC Document 57

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------- X

HDTRACKS.COM, LLC,

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT Plaintiff,
OF NEW YORK
-----------------------------------------------------------x
-againstIn re FANNIE MAE 2008 SECURITIES
:
LITIGATION
:
7DIGITAL LIMITED, a UK private :
limited company,
:
-----------------------------------------------------------x

Filed 09/30/10 Page 1 of 45
USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: _________________
DATE FILED: 02/20/2020

No. Civ. 7831 (PAC)
08 18 Civ. 5823
ORDER
09 MD 2013 (PAC)

(JFK)

OPINION & ORDER

Defendant.

------------------------------- X

JOHN F. KEENAN, United States District Judge:

HONORABLE PAUL A. CROTTY, United States District Judge:

On February 18, 2020, Plaintiff HDtracks.com, LLC ("HDT")
1

BACKGROUND
filed a motion (ECF No. 52) for an order certifying the Court's
The early years of this decade saw Order home February 6th Order") (ECF
February 6, 2020 Opinion & a boom in("the financing which was fueled, among
No. 51) low interlocutory credit conditions. New lending instruments,
other things, byfor interest rates and lax review pursuant to 28 U.S.C. § such as
1292(b).
HDT's motion loans) and Alt-A mortgages (low-documentation loans)
subprime mortgages (high credit risk is DENIED.
Section 1292(b) provides for certification of an order for
kept the boom going. Borrowers played a role too; they took on unmanageable risks on the
interlocutory appeal continue to court determines that would always
assumption that the market would when the rise and that refinancing options the order be
appealed from (1)

"involves a controlling question of law," (2)

available in the future. Lending discipline was lacking in the system. Mortgage originators did
"as to which there is

[a] substantial ground for difference of

not hold these high-risk mortgage loans. Rather than carry the rising risk on their books, the

opinion," and (3) "that an immediate appeal . . . may materially

originators sold their loans into the secondary mortgage market, often as securitized packages

advance the ultimate termination of the litigation." 28 U.S.C. §

known as mortgage-backed securities (“MBSs”). MBS markets grew almost exponentially.
1292(b); see also In re Facebook, Inc., IPO Sec. & Derivative

But then the housing bubble burst. In 2006, the demand for housing dropped abruptly

Litig., 986 F. Supp. 2d 524, 529 (S.D.N.Y. 2014).

"The

and home prices began to fall. In light of the changing housing market, banks modified their
proponent[] of an interlocutory appeal ha[s] the burden of

lending practices and became unwilling to refinance home mortgages without refinancing.

showing that all three of the substantive criteria are met." In

1

Unless otherwise indicated, all references cited as “(¶ _)” or to the “Complaint” are to the Amended Complaint,
dated June 22, 2009. For purposes of this Motion, all allegations in the Amended Complaint are taken as true.
1

1

re Facebook, 986 F. Supp. 2d at 529 (citing Casey v. Long Island
R.R., 406 F.3d 142, 146 (2d Cir. 2005)).
"The Second Circuit has noted that 'interlocutory appeals
are strongly disfavored in federal practice,' and movants cannot
invoke the appellate process 'as a vehicle to provide early
review [even] of difficult rulings in hard cases.'" Id. at 530
(brackets in original)

(quoting In re Adelphia Commc'ns Corp.,

No. 07 Civ. 9999 (NRB), 2008 WL 361082, at *1 (S.D.N.Y. Feb. 7,
2008)); see also Koehler v. Bank of Bermuda Ltd., 101 F.3d 863,
865 (2d Cir. 1996)

("It is a basic tenet of federal law to delay

appellate review until a final judgment has been entered.").
Further, certification of a non-final order pursuant to§
1292(b) is an extraordinary procedure that is only available in
"exceptional circumstances." In re Facebook, 986 F. Supp. 2d at
530; In re Ambac Fin. Grp., Inc. Sec. Litig., 693 F. Supp. 2d
241, 282 (S.D.N.Y. 2010); see also Koehler, 101 F.3d at 865-66
("The use of§ 1292(b) is reserved for those cases where an
intermediate appeal may avoid protracted litigation.").
HOT has not alleged sufficient grounds to justify a
departure from the basic policy of postponing appellate review
until after the entry of a final judgment because none of the
issues raised by HOT meet the standards set by§ 1292(b) or
persuade the Court that exceptional circumstances exist in this
case.

Accordingly, HDT's motion is DENIED.

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The parties are

directed to comply with the February 6th Order by proceeding to
discovery before Magistrate Judge Parker, and by filing a jointproposed case management order for the Court's approval no later
than March 9, 2020.
The Clerk of Court is directed to terminate the motion
docketed at ECF No. 52.
SO ORDERED.

Dated:
Judge

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