Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_09-cv-02988/USCOURTS-caed-2_09-cv-02988-1/pdf.json

Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 28:1334 Bankruptcy Appeal

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

1

UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

IN RE:

SK FOODS, L.P., and RHM

INDUSTRIAL/SPECIALTY FOODS,

INC.,

Debtors.

SSC FARMING, LLC, SSC 

FARMS I, LLC, SSC FARMS II,

LLC, SSC FARMS III, LLC,

BLACKSTONE RANCH CORPORATION,

MONTEREY PENINSULA FARMS,

LLC, SALYER MANAGEMENT

COMPANY, LLC, SS FARMS, LLC, NO. CIV. S-09-2988 LKK

Appellants,

v.

O R D E R

SK FOODS, L.P., and RHM

INDUSTRIAL/SPECIALTY FOODS,

INC.,

Appellees.

 /

This matter is before the court on appeal from a bankruptcy

case and related adversary proceeding. On October 16, 2009, the

Bankruptcy Judge disqualified counsel for various parties adverse

Case 2:09-cv-02988-LKK Document 13 Filed 01/07/10 Page 1 of 4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

 Although counsel for the trustee contends that this notice 1

is in error, the clerk of the bankruptcy court informs this court

that the notice is correct. Giving the parties the benefit of the

doubt, the notice at least reflects the clerk’s understanding of

the record, such that the notice was not inadvertent.

2

to the debtor. Appellants seek interlocutory review of this order.

Currently pending before the court are two matters. The first

is whether to grant leave to file an interlocutory appeal, pursuant

to 28 U.S.C. § 158(a)(3) and Fed. R. Bankr. P. 8001(b). The

parties appear to contend that the briefing on appellants’ motion

for leave is complete. However, the deputy clerk of the Bankruptcy

Court has filed a “notice of incomplete or delayed record,” (Doc.

No. 8), stating that the designation of record and statement of

issues have not been filed. This court’s own investigation of the 1

record has also failed to locate these documents. Accordingly, the

parties are directed to notify the clerk of bankruptcy court where

in the record these documents are located, or alternatively to refile these documents.

The second matter pending before this court is appellants’

motion for extension of the stay of the bankruptcy court’s

disqualification order. The Bankruptcy Judge initially stayed

disqualification until December 18, 2009. Appellants then moved

to extend the stay until the appeal was resolved. (Doc. No. 5.)

This court preliminarily extended the stay until January 11, 2010,

the day on which the motion for extension was to be heard. (Doc.

No. 9.) In evaluating the motion for extension, the court must

consider whether “(1) appellant is likely to succeed on the merits

Case 2:09-cv-02988-LKK Document 13 Filed 01/07/10 Page 2 of 4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

3

of the appeal; (2) appellant will suffer irreparable injury; (3)

no substantial harm will come to appellee; and (4) the stay will

do no harm to the public interest.” Ohanian v. Irwin (In re

Irwin), 338 B.R. 839, 843 (E.D. Cal. 2006). The first factor,

whether appellants are likely to succeed on the appeal, obviously

turns on whether leave to file an appeal is granted. The parties’

briefing concerning the stay (all of which the court possesses)

includes some discussion of this issue. However, in light of the

parties’ contention that more thorough briefing on this subject has

already been prepared, the court declines to determine whether to

grant leave (or the likelihood of granting leave in the future)

without consideration of this wayward briefing. The court

therefore continues the hearing on the motion for extension of the

stay until January 25, 2010, so as to allow the parties to complete

the record prior to the hearing.

This leaves the question of whether to extend the stay pending

the hearing. The appellees contend that any stay imposes a

hardship on them, and the court has already granted a three week

extension of the stay without discussion of the Irwin factors. At

this point, the court concludes that appellants have shown enough

of a chance of success on the merits and a possibility of

irreparable injury sufficient to outweigh the minimal hardship

imposed by a further two week extension. 

For the reasons stated above, the court ORDERS as follows:

1. Within 7 days of the date of this order, the parties

SHALL EITHER re-file the documents designated as missing

Case 2:09-cv-02988-LKK Document 13 Filed 01/07/10 Page 3 of 4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

4

in the Notice of Incomplete or Delayed Record (Doc. No.

8) OR inform the clerk of the bankruptcy court where

these documents may be found in the record.

2. The stay of the Bankruptcy Judge’s October 16, 2009

order disqualifying appellants’ counsel is EXTENDED

until January 25, 2010.

3. The hearing on appellants’ motion to extend the stay,

(Doc. No. 5), is CONTINUED until January 25, 2010.

IT IS SO ORDERED.

DATED: January 7, 2010.

Case 2:09-cv-02988-LKK Document 13 Filed 01/07/10 Page 4 of 4