Court Opinion

ID: 3132426
Source: CourtListenerOpinion
Date Created: 2015-10-19 15:00:44.772454+00
Date Added: 2024-06-11T12:27:07.332229
License: Public Domain

14-3915
     In re: Fiorano Tile Imports, Inc.

                                          UNITED STATES COURT OF APPEALS
                                              FOR THE SECOND CIRCUIT

                                                   SUMMARY ORDER

 1   RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
 2   SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY
 3   FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN
 4   CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE
 5   EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION
 6   “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY ORDER MUST SERVE A COPY OF IT ON
 7   ANY PARTY NOT REPRESENTED BY COUNSEL.
 8
 9           At a stated term of the United States Court of Appeals for the Second Circuit, held
10   at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New
11   York, on the 19th day of October, two thousand fifteen.
12
13   PRESENT:
14                          BARRINGTON D. PARKER,
15                          GERARD E. LYNCH,
16                          SUSAN L. CARNEY,
17                                    Circuit Judges.
18
19
20   In re: FIORANO TILE IMPORTS, INC.,
21               Debtor,
22
23   CHERRY VALLEY ASSOCIATES, LLC,
24            Creditor-Appellant,
25
26                                       v.                                         14-3915
27
28   FIORANO TILE IMPORTS, INC.,
29              Debtor-Appellee.
30   _____________________________________
31
32   FOR APPELLANT:                           Richard V. Kanter, Melville, NY.
33
34   FOR APPELLEE:                            Anthony F. Giuliano, Scott L. Swanson, Pryor & Mandelup,
35                                            L.L.P., Westbury, NY.
36
37
 1          Appeal from a judgment of the United States District Court for the Eastern District

 2   of New York (Arthur D. Spatt, J.) affirming the June 20, 2013 Confirmation Order of the

 3   United States Bankruptcy Court (Alan S. Trust, J.) on the ground that the appeal is

 4   equitably moot.

 5          UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,

 6   AND DECREED that the judgment of the district court is AFFIRMED.

 7          Cherry Valley Associates, LLC (“Cherry Valley”) challenges the bankruptcy

 8   court’s order confirming the seventh amended plan of reorganization (the “Plan”) of the

 9   debtor-appellee, Fiorano Tile Imports, Inc. The district court found that the Plan was

10   substantially consummated under 11 U.S.C. § 1101(2) of the Bankruptcy Code, so that

11   the presumption of equitable mootness applied, and that the presumption was not rebutted

12   by Cherry Valley.

13          As an initial matter, most of the arguments that Cherry Valley raises on appeal

14   were not raised below. “[I]t is a well-established general rule that an appellate court will

15   not consider an issue raised for the first time on appeal.” Askins v. Doe No. 1, 727 F.3d
16   248, 252 (2d Cir. 2013) (internal quotation marks omitted). This “court has discretion to

17   consider arguments waived below,” and will exercise that discretion “where necessary to

18   avoid a manifest injustice.” In re Nortel Networks Corp. Sec. Litig., 539 F.3d 129, 133

19   (2d Cir. 2008). However, “the circumstances normally do not militate in favor of an

20   exercise of discretion to address . . . new arguments on appeal where those arguments

21

                                                   2
 1   were available to the [parties] below and they proffer no reason for their failure to raise

 2   the arguments below.” Id. (alterations in original) (internal quotation marks omitted).

 3          In the district court, Cherry Valley argued only that the case was not equitably

 4   moot because the Plan had not been substantially consummated. In this Court, Cherry

 5   Valley “does not challenge” the district court’s findings that “[t]he Seventh Amended

 6   Plan was . . . substantially consummated under § 1101(2) of the Bankruptcy Code” and

 7   that it failed to rebut the presumption of equitable mootness, Brief for Creditor-Appellant

 8   at 14, and instead primarily argues that equitable mootness should not apply because of

 9   the debtor’s lack of good faith or unclean hands. Because those arguments were not

10   raised below, they have been forfeited.

11          Nor do we find it necessary to consider those arguments to prevent manifest

12   injustice. Cherry Valley argues that it could not have raised the arguments below because

13   In re Chateaugay Corp., 10 F.3d 944 (2d Cir. 1993) made these arguments “unavailable,

14   as a matter of law, in the district court.” Reply Brief for Creditor-Appellant at 5. Cherry

15   Valley, however, could have argued to the district court that Chateaugay should be

16   distinguished, or that equitable mootness should not apply for the reasons it presses on its

17   appeal. To the extent that Cherry Valley contends that the arguments would have failed

18   in the district court because Chateaugay controls this case, the same precedent is equally

19   binding on a panel of this Court. “[A] panel of our Court is bound by the decisions of

20   prior panels until such time as they are overruled either by an en banc panel of our Court

21   or by the Supreme Court.” Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 585

                                                   3
 1 F.3d 58, 67 (2d Cir. 2009) (internal quotation marks omitted). To the extent Cherry

 2   Valley seeks to preserve any argument that Chateaugay should be overruled, it could and

 3   should have presented that argument below, as it does here, in order to preserve it for

 4   review before this Court sitting en banc or before the Supreme Court.

 5          The only argument that Cherry Valley raises on appeal that it did raise in the

 6   district court is its contention that the court was required to consider the propriety of

 7   confirming the Plan before deciding whether the case was equitably moot. We review the

 8   district court’s decision on equitable mootness for abuse of discretion. In re Charter

 9   Commc’ns, Inc., 691 F.3d 476, 483 (2d Cir. 2012). As our precedent makes clear, the

10   doctrine of equitable mootness permits a court to decide whether an action should be

11   dismissed before reaching the underlying merits of the appeal. See id. at 484; In re

12   Chateaugay Corp., 988 F.2d 322, 325 (2d Cir. 1993). The district court did not err by

13   following binding Second Circuit precedent and holding that Cherry Valley’s claims were

14   equitably moot without first considering the propriety of the Plan.

15          Accordingly, we AFFIRM the judgment of the district court.

16
17
18                                       FOR THE COURT:
19                                       CATHERINE O’HAGAN WOLFE, Clerk of Court
20
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