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Appellate Jurisdiction: Rule 37 Monetary Sanctions Unappealable under Cunningham & Too Linked to Merits (+ Reviewable Later) to Fall within Collateral Order Doctrine

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Siser N. Am., Inc. v. World Paper, Inc., 2018 U.S. App. LEXIS 33313 (6th Cir. Nov. 27, 2018):

Michael Laurence Feinstein, former attorney for Defendants, appeals the district court's interlocutory order, ordering him to pay $76,925.53 in sanctions. Plaintiffs Siser North America, Inc. and Siser S.R.L. move to dismiss the appeal for lack of jurisdiction. Plaintiffs also request costs and damages. Feinstein responds in opposition. Plaintiffs reply.

We are vested with jurisdiction over final decisions of the district courts. 28 U.S.C. § 1291. A decision is generally final if it "ends the litigation on the merits and leaves nothing for the court to do but execute the judgment." Catlin v. United States, 324 U.S. 229, 233, 65 S. Ct. 631, 89 L. Ed. 911 (1945). Because Rule 37 sanctions do not end the litigation or leave the court to only execute a judgment, the order issuing sanctions is not considered sufficiently final. Cunningham v. Hamilton Cty., 527 U.S. 198, 204, 119 S. Ct. 1915, 144 L. Ed. 2d 184 (1999).

However, non-final orders may be appealable under the collateral order doctrine, permitting jurisdiction over "decisions that are conclusive, that [*2]  resolve important questions separate from the merits, and that are effectively unreviewable on appeal from the final judgment in the underlying action." Swint v. Chambers Cty. Comm'n, 514 U.S. 35, 42, 115 S. Ct. 1203, 131 L. Ed. 2d 60 (1995); see also Cohen v. Beneficial Indus. Loan Corp, 337 U.S. 541, 546, 69 S. Ct. 1221, 93 L. Ed. 1528 (1949). But similarly to Cunningham, the order that Feinstein seeks to appeal is non-final, non-appealable, and does not fall within the purview of the collateral order doctrine. The sanctions order, stemming from the district court's finding of abuse within the discovery process, is not sufficiently separate from the merits and, regardless, is effectively reviewable on appeal from a final judgment. Further, "[t]o permit an immediate appeal from such a sanctions order would undermine the very purposes of Rule 37(a), which was designed to protect courts and opposing parties from delaying or harassing tactics during the discovery process." Cunningham, 527 U.S. at 208.

Accordingly, the motion to dismiss for lack of jurisdiction is GRANTED. Given the lack of delay in district court proceedings and the present stage of appellate proceedings, the request for costs and damages is DENIED.

 

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New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.
New York Attorneys JHA handles range the gamut of complex financial and commercial litigation and arbitration, including securities, RICO, corporate and contract disputes, credit default swaps, derivatives, and class, mass, and derivative actions. The firm also represents law firms in major disputes.

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