Opinion ID: 521591
Heading Depth: 1
Heading Rank: 2

Heading: jurisdiction

Text: 10 Landmark is appealing an order of a bankruptcy court under 11 U.S.C. Sec. 1113(e) (Supp. IV. 1986) affirmed by a BAP. Section 1113(e) provides: 11 If during a period when the collective bargaining agreement continues in effect, and if essential to the continuation of the debtor's business, or in order to avoid irreparable damage to the estate, the court ... may authorize the trustee to implement interim changes in the terms, conditions, wages, benefits, or work rules provided by a collective bargaining agreement.... The implementation of such interim changes shall not render the application for rejection moot. 12 The unions contend that an order under this section is not final and, therefore, not appealable to this court. We agree.
13 In bankruptcy cases, under 28 U.S.C. Sec. 158(d) (Supp. IV 1986), we have jurisdiction only over appeals from final decisions, judgments, orders, and decrees. 2 We have defined a final decision in the bankruptcy context as one that  'ends the litigation on the merits and leaves nothing for the court to do but [execute the] judgment.'  Dental Capital Leasing Corp. v. Martinez (In re Martinez), 721 F.2d 262, 265 (9th Cir.1983) (quoting Catlin v. United States, 324 U.S. 229, 233, 65 S.Ct. 631, 633, 89 L.Ed. 911 (1945)). We have explained, more specifically, that such a decision must finally determine the discrete issue to which it is addressed.... When further proceedings in the bankruptcy court will affect the scope of [an] order, the order is not subject to review in this court.... Four Seas Center, Ltd. v. Davres, Inc. (In re Four Seas Center, Ltd.), 754 F.2d 1416, 1418 (9th Cir.1985) (citation omitted); see Turgeon v. Victoria Station Inc. (In re Victoria Station Inc.), 840 F.2d 682, 683-84 (9th Cir.1988). 14
15 To the extent that an interim relief order under Sec. 1113(e) addresses any discrete issue, we believe that it addresses the issue whether a debtor must abide by all, some portion, or none of the terms of its collective bargaining agreements after the filing of a bankruptcy petition. We do not believe that such an order finally determines this issue for four reasons. 16 First, the language of Sec. 1113(e) expressly permits a debtor to continue to seek authority to reject a collective bargaining agreement even after a bankruptcy court has granted interim relief. Such authority, if granted, unavoidably would alter or terminate the interim relief. Second, the section also seems to permit a court to order further interim relief if necessary. Such additional relief, of course, would alter the initial interim relief. Third, even if an interim relief order makes rejection contingent on the occurrence of an event, as in this case, the order is not a final determination of all issues because whether the event has occurred may be contested. The Joint Board and the Trade Unions, for example, could dispute whether they had failed to arbitrate the me-too and most favored nations clauses. Fourth, we find orders providing interim relief under Sec. 1113(e) highly analogous to orders appointing interim trustees under 11 U.S.C. Sec. 701(a) (Supp. IV 1986) and those awarding interim compensation under Sec. 331 (1982). The courts of appeals have rejected appeals of orders under these sections for lack of finality and we see no convincing way to distinguish their opinions. See, e.g., Foster Sec., Inc. v. Sandoz (In re Delta Servs. Indus., Etc.), 782 F.2d 1267, 1271-72 (5th Cir.1986) (interim trustee); Stable Mews Assocs. v. Togut (In re Stable Mews Assocs.), 778 F.2d 121, 123-24 (2d Cir.1985) (interim compensation); Salomon v. Logan (In re International Envtl. Dynamics, Inc.), 718 F.2d 322, 325 & n. 5 (9th Cir.1983) (same). See also In re Klein, 70 B.R. 378, 380 (N.D.Ill.1987) (interim trustee). 17 We thus hold that a debtor may not immediately appeal to this court the judgment of the BAP with respect to an interim relief order under Sec. 1113(e). To obtain review here, the debtor must wait until the bankruptcy court has rendered its ultimate order on the rejection issue. Only at that point will the bankruptcy court have determined finally all of the relevant issues. See, e.g., Truck Drivers Local 807 v. Carey Transp. Inc., 816 F.2d 82, 86-87 (2d Cir.1987) (appeal of order authorizing rejection); Century Brass Prods., Inc. v. International Union UAW (In re Century Brass Prods., Inc.), 795 F.2d 265, 269 (2d Cir.) (same), cert. denied, 479 U.S. 949, 107 S.Ct. 433, 93 L.Ed.2d 383 (1986); Wheeling-Pittsburgh Steel Corp. v. United Steelworkers, 791 F.2d 1074, 1078 (3d Cir.1986) (same). The debtor at that point can appeal any adverse effects of an interim relief order. Cf. Sackett v. Beaman, 399 F.2d 884, 889 n. 6 (9th Cir.1968) (All interlocutory rulings [are] merged in [a] final judgment and are reviewable on the appeal therefrom.). 18
19 Landmark, nonetheless, has made three arguments that its relief order was final which merit careful attention. First, Landmark contends, in so many words, that its appeal is not interlocutory because, while the bankruptcy court had not authorized rejection of the collective bargaining agreements at the time Landmark appealed to the BAP, the bankruptcy court now has authorized rejection, and Landmark has rejected the contracts. Hearing its appeal now, Landmark insists, would not interfere with the work of the bankruptcy court. Its work is done. The case, therefore, resembles Dahlquist v. First Nat'l Bank (In re Dahlquist), 751 F.2d 295, 297 (8th Cir.1985), in which the court permitted an appeal of an order awarding an interim fee because the underlying bankruptcy proceeding had been dismissed by the bankruptcy court prior to the district court's order affirming the interim award. See also Susman v. Schmid (In re Reid), 854 F.2d 156, 158 n. 2 (7th Cir.1988) (holding interim fee award was actually final to attorneys who completed their work); Yermakov v. Fitzsimmons (In re Yermakov), 718 F.2d 1465, 1468-69 (9th Cir.1983) (same). 20 We are not persuaded. Here the bankruptcy court has authorized rejection of the contracts. Landmark had the opportunity to initiate an appeal after that action in which it could have presented its complaints about the interim order. It failed to use that opportunity, however. In Dahlquist, by contrast, the creditor objecting to the interim fee award never had, and never would have, a proper opportunity to appeal. Its appeal had been retained by the district court when the bankruptcy proceedings were transferred to another jurisdiction. Thus the order dismissing the bankruptcy action did not include the order granting interim compensation. Under the circumstances of this case, we decline to transform an appeal from an interlocutory order into an appeal from a final order because the underlying dispute has been resolved finally in the bankruptcy court. We believe that such a holding would create significant difficulties. It would provide debtors an incentive to delay BAP action when a bankruptcy court's final decision was reasonably imminent. On the other hand, despite its likely futility, creditors might be encouraged to hasten the BAP's disposition in an effort to insulate it from court of appeals review. We decline to find that the fortuitous timing of the bankruptcy court's final decision gives us jurisdiction. 21 Second, Landmark contends that we should take jurisdiction under the pragmatic view of finality in bankruptcy cases that this court has recognized. See, e.g., Mason v. Integrity Ins. Co. (In re Mason), 709 F.2d 1313, 1318 (9th Cir.1983). We agree that courts have expressed a willingness to hear appeals if waiting until the end of the case would cause  'irreparable harm to the losing party.'  Id. at 1316 (quoting Levin, Bankruptcy Appeals, 58 N.C.L.Rev. 967, 985-86 (1980)); accord Farber v. 405 N. Bedford Dr. Corp. (In re 405 N. Bedford Dr. Corp.), 778 F.2d 1374, 1377 (9th Cir.1985). The authorities supporting this view, however, do not make irreparable harm an exception to the requirement of finality; instead, they merely permit the possibility of irreparable harm to influence and inform the rules governing finality. In this case, the harm that Landmark would suffer by complying with the interim order does not persuade us to find finality. When complying with an interim relief order becomes overly burdensome, a debtor should renew its application for rejection and present the new facts to bankruptcy court. We should not encourage debtors not to comply with interim orders. 22 Third, Landmark takes issue with the proposition that it could appeal the bankruptcy court's final order. It argues that order did not aggrieve it. See Fondiller v. Robertson (In re Fondiller), 707 F.2d 441, 442-43 (9th Cir.1983) (holding that only those persons aggrieved by a bankruptcy court's order have standing to appeal). This is not correct. The interim order's consequences during its effective period were not altered by the bankruptcy court's final order. Landmark was, and is, much aggrieved by that order. This court would review that order in Landmark's appeal from the final ruling by the bankruptcy court on rejection. An appeal at that time falls precisely within the class of cases the Supreme Court contemplated when it said, [i]n an appropriate case, appeal may be permitted from an adverse ruling collateral to the judgment on the merits at the behest of the party who has prevailed on the merits, so long as that party retains a stake in the appeal satisfying the requirements of Art[icle] III. Deposit Guar. Nat'l Bank v. Roper, 445 U.S. 326, 334, 100 S.Ct. 1166, 1171, 63 L.Ed.2d 427 (1980) (permitting plaintiffs to appeal denial of class certification after prevailing on the merits). Although Roper addressed appeals under 28 U.S.C. Sec. 1291 (1982) rather than under Sec. 158(d) (Supp. IV 1986), we see no reason that its principle should not apply in the instant case. 23 It may appear that the result we reach is somewhat harsh. We recognize this but are confident that our decision will contribute some clarity to an area of law that, at best, is translucent. 24 APPEAL DISMISSED.