Court Opinion

ID: 808861
Source: CourtListenerOpinion
Date Created: 2012-09-20 14:47:07+00
Date Added: 2024-06-11T18:00:32.326535
License: Public Domain

11-4248-cv(L)
         NML Capital, Ltd. v. Republic of Argentina, et al.

                                 UNITED STATES COURT OF APPEALS
                                     FOR THE SECOND CIRCUIT

                                              SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1,
2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1.
WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON
ANY PARTY NOT REPRESENTED BY COUNSEL.

 1            At a stated term of the United States Court of Appeals
 2       for the Second Circuit, held at the Daniel Patrick Moynihan
 3       United States Courthouse, 500 Pearl Street, in the City of
 4       New York, on the 20th day of September, two thousand twelve.
 5
 6       PRESENT: BARRINGTON D. PARKER,
 7                RICHARD C. WESLEY,
 8                         Circuit Judges
 9                JOHN GLEESON,*
10                         District Judge.
11
12
13
14       NML CAPITAL, LTD.,                                                 11-4248-cv        (L)
15                                                                          11-4250-cv        (Con)
16                                     Plaintiff-Appellant,                 11-4252-cv        (Con)
17                                                                          11-4257-cv        (Con)
18                      v.                                                  11-4272-cv        (Con)
19                                                                          11-4273-cv        (Con)
20       THE REPUBLIC OF ARGENTINA,                                         11-4280-cv        (Con)
21                                                                          11-4281-cv        (Con)
22                                     Defendant-Appellee                   11-4284-cv        (Con)
23                                                                          11-4285-cv        (Con)
24                                                                          11-4286-cv        (Con)
25
26       EMPRESA ARGENTINA DE SOLUCIONES SATELITALES, S.A.
27
28                                     Interested Non-Party-Appellee
29
30

                *
                Judge John Gleeson, of the United States District Court
         for the Eastern District of New York, sitting by designation.
 1   FOR APPELLANT:    MATTHEW D. MCGILL, Gibson, Dunn &
 2                     Crutcher LLP, Washington D.C. (Theodore
 3                     B. Olson, Gibson, Dunn & Crutcher,
 4                     Washington D.C.; Robert A. Cohen, Dennis
 5                     H. Hranitzky, Eric C. Kirsh, Dechert LLP,
 6                     New York, NY, on the brief).
 7
 8
 9   FOR APPELLEE:     JONATHAN I. BLACKMAN (Carmine Boccuzzi,
10                     on the brief), Cleary Gottlieb Steen &
11                     Hamilton LLP, New York, NY.
12
13   FOR INTERESTED    STEVEN M. HECHT, (Kevin M. Brennan, on
14   NON-PARTY-        the brief), Lowenstein Sandler PC, New
15   APPELLEE:         York, NY.
16
17
18
19        Appeal from the United States District Court for the
20   Southern District of New York (Griesa J.).
21
22       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED

23   AND DECREED that this appeal is DISMISSED as MOOT and the

24   judgment of the United States District Court for the

25   Southern District of New York is VACATED.   The case is

26   REMANDED to the district court with directions to DISMISS

27   NML’s motion to confirm and the Republic’s and AR-SAT’s

28   cross-motion to vacate the attachment.

29       Plaintiff-Appellant NML Capital, Ltd (“NML”) appeals

30   from the opinion of the United States District Court for the

31   Southern District of New York (Griesa, J.), denying NML’s

32   motion for confirmation of an order of attachment and

33   granting the cross-motion of Defendant-Appellee Republic of

                                  2
1    Argentina (“Republic”) and Interested Non-Party-Appellee

2    Empresa Argentina de Soluciones Satelitales, S.A. (“AR-SAT”)

3    to vacate the attachment.   NML moved for reconsideration,

4    and the district court ordered a hearing on the motion.

5    Prior to that hearing, the property was removed from the

6    country.   We assume the parties’ familiarity with the

7    underlying facts, the procedural history, and the issues

8    presented for review.

9        An appeal becomes moot “when the issues presented are

10   no longer ‘live’ or the parties lack a legally cognizable

11   interest in the outcome.”   Murphy v. Hunt, 455 U.S. 478, 481

12   (1982) (per curiam) (internal quotation marks omitted).

13   Mootness defeats subject matter jurisdiction, and thus is a

14   defect that cannot be waived.       Fox v. Bd. of Trs. of State

15   Univ. of N.Y., 42 F.3d 135, 140 (2d Cir. 1994).       Here, the

16   property that NML sought to attach is no longer attachable;

17   it was removed from the country.      Accordingly, this case no

18   longer “admit[s] of specific relief through a decree of a

19   conclusive character.”   Preiser v. Newkirk, 422 U.S. 395,

20   401 (1975) (internal quotation marks omitted).      In the words

21   of the district court at oral argument on NML’s motion for

22   reconsideration, “the relief which might be granted would be

                                     3
1    the reinstatement of the attachment, but now there is

2    nothing to attach.” (JA 1591.)       Because NML cannot get any

3    specific relief from this appeal, the case is moot and this

4    Court lacks jurisdiction to address its merits.       Any

5    decision from this Court as to the underlying merits of the

6    attachment would amount to nothing more than an advisory

7    opinion.

8        The standard disposition when a federal civil case

9    becomes moot while on appeal is to vacate the judgment of

10   the district court and remand with a direction to dismiss

11   the case.     U.S. Bancorp Mortg. Co. v. Bonner Mall P’ship,

12   513 U.S. 18, 22 (1994); United States v. Munsingwear, Inc.,

13   340 U.S. 36, 39 & n.2 (1950).       “The rationale is that a

14   judgment from which litigants have the right of appeal

15   should not be accorded preclusive effect when events beyond

16   their control prevent them from exercising that right.”

17   Penguin Books USA Inc. v. Walsh, 929 F.2d 69, 73 (2d Cir.

18   1991).     This is especially true when the winning party below

19   voluntarily moots the case.     See id.    Indeed, “when actions

20   of winning litigants serve to deny their adversaries the

21   opportunity to appeal[,] . . . it may amount to an abuse of

22   discretion not to vacate the lower court order.”       Id.     In

                                     4
1    other words, “vacatur must be granted where mootness results

2    from the unilateral action of the party who prevailed in the

3    lower court.”    U.S. Bancorp, 513 U.S. at 23.    “Were it

4    otherwise, appellees could deliberately moot cases on

5    appeal, thereby shielding erroneous decisions from reversal.

6    Approval of such a strategy would render the bizarre result

7    that judgments mooted on appeal would have greater

8    preclusive effect than cases susceptible to review.”

9    Penguin Books, 929 F.2d at 73 (internal citations omitted).

10   Because AR-SAT mooted this case pending appeal by

11   intentionally removing from the country the satellite parts

12   sought to be attached, the appropriate disposition is to

13   vacate the district court’s judgment and remand with

14   instructions to dismiss the case.

15       AR-SAT and the Republic attempt to avoid this result on

16   three grounds.   First, they contend that this case fits

17   within the narrow “capable of repetition, yet evading

18   review” exception to the mootness doctrine.      We disagree.

19   The challenged action in this case is not inherently too

20   short in duration to permit review.    See, e.g., Fox, 42 F.3d

21   at 143.   Even if AR-SAT satisfied the “capable of

22   repetition” prong by showing a “demonstrated probability

                                    5
1    that the same controversy will recur involving the same

2    complaining party,” Murphy, 455 U.S. at 482 (internal

3    quotation marks omitted), the attachment action would evade

4    review only to the extent that AR-SAT again voluntarily

5    removed the subject property from the jurisdiction.     This is

6    not an intrinsic limit on the duration of the live

7    controversy.

8        Second, AR-SAT and the Republic argue that NML has

9    waived its right to vacatur by failing to seek a stay of the

10   district court’s order pending reconsideration and appeal.

11   This argument is misplaced.   The Supreme Court has

12   recognized that vacatur is not justified where “the party

13   seeking relief from the judgment below caused the mootness

14   by voluntary action.”   U.S. Bancorp, 513 U.S. at 24.    For

15   example, when a losing party settles with its adversary

16   before the resolution of the appeal, it has “voluntarily

17   forfeited [its] legal remedy . . . of appeal.”   Id. at 25.

18   In such a situation, the party “surrender[s] [its] claim to

19   the equitable remedy of vacatur” because “[t]he judgment is

20   not unreviewable, but simply unreviewed by [its] own

21   choice.”   Id.

22

                                   6
1        AR-SAT and the Republic urge the Court to conclude that

2    NML surrendered its claim to vacatur because it voluntarily

3    forfeited its right to appeal by failing to seek a stay of

4    the district court’s order pending appeal.   This is not the

5    kind of voluntary forfeiture the Supreme Court had in mind.

6        NML has continuously pursued its rights in this case by

7    timely appealing and timely moving for reconsideration of

8    the district court’s order.   The voluntary action that

9    prevented review on appeal was AR-SAT’s removal of the

10   property–not NML’s failure to seek a stay to prevent AR-SAT

11   from removing the property.   While courts have recognized

12   that a party waives its right to vacatur for failing to

13   appeal or to follow statutory obligations in pursuit of an

14   appeal, see U.S. Bancorp, 513 U.S. at 24-25; Mahoney v.

15   Babbitt, 113 F.3d 219, 221-22 (D.C. Cir. 1997); In re Motors

16   Liquidation Co., No. 09-CIV-7794, 2010 WL 3565494, at *2-3

17   (S.D.N.Y. Sept. 10, 2010), this Court has never held that a

18   party forfeits its right to vacatur of an order simply by

19   failing to file a motion to stay the effect of that order

20   while timely pursuing reconsideration and appeal.

21       Finally, AR-SAT and the Republic ask us to affirm the

22   order of the district court because the order still has

                                   7
1    great “practical significance” and AR-SAT would like to

2    “invoke the court’s decision in the future.”    This argument

3    highlights the very reason why vacatur is the appropriate

4    result in this case.    Only final judgments are accorded

5    preclusive effect.     Arizona v. California, 530 U.S. 392, 414

6    (2000), supplemented, 531 U.S. 1 (2000).     Where a party is

7    frustrated from seeking review of an adverse ruling, that

8    party “ought not in fairness be forced to acquiesce in the

9    judgment.”   U.S. v. Bancorp, 513 U.S. at 25.    Vacating the

10   judgment below properly “clears the path for future

11   relitigation of the issues between the parties.”

12   Munsingwear, 340 U.S. at 40.

13       Accordingly, because the voluntary actions of the

14   winning party below have prevented this Court from reviewing

15   the merits of the district court’s decision, vacatur of the

16   lower court’s judgment is the appropriate remedy in this

17   case.

18       We have considered the Republic and AR-SAT’s remaining

19   arguments and, after a thorough review of the record, find

20   them to be without merit.

21       For the foregoing reasons, the appeal is DISMISSED as

22   MOOT, and the district court judgment is hereby VACATED.

                                     8
1   The case is REMANDED to the district court with directions

2   to DISMISS NML’s motion to confirm and the Republic’s and

3   AR-SAT’s cross-motion to vacate the attachment.

4
5                              FOR THE COURT:
6                              Catherine O’Hagan Wolfe, Clerk
7
8

                                 9