Pursuing an untimely appeal is likely to result in sanctions for a frivolous appeal, at least in the Fifth Circuit.
A creditor objected to the allowance of another creditor’s claim that was based on a state court judgment against the debtor. The bankruptcy court denied the objection, citing the Rooker-Feldman doctrine. (For ABI’s discussion of a recent Rooker-Feldman opinion from the Third Circuit, click here.]
The objecting creditor was one day late in filing a notice of appeal to the district court. The appellee (the creditor with the claim that had been allowed) filed a motion to dismiss the appeal as untimely and for the imposition of sanctions for a frivolous appeal.
The district court dismissed the appeal as untimely and assessed $21,500 in sanctions to cover the appellee’s attorneys’ fees. The creditor-appellant appealed to the Fifth Circuit.
In an unpublished, non-precedential opinion on Jan. 12, the Fifth Circuit upheld the sanctions imposed in district court.
The creditor contended in the circuit court, as it had in district court, that the late filing of an appeal is not jurisdictional.
The appeals court disagreed, saying that all 10 circuits to consider the issue have held that the late filing of an appeal indeed is jurisdictional. The Fifth Circuit is among the 10, having held twice that a late appeal divests the appellate court of jurisdiction.
The Fifth Circuit said that the outcome in both the district and circuit courts was “obvious” given the “‘clear, unambiguous, dispositive holdings of this and other appellate courts.’” As a result, the circuit court said, the appeals to both courts were frivolous and warranted sanctions under Bankruptcy Rules 9011 and 8020(a) and F.R.A.P. 38.
In short, someone who files a late appeal in the Fifth Circuit should pack up and consent to dismissal. Opposing dismissal without a substantial due process argument is likely to end with the imposition of sanctions for pursuing a frivolous appeal.
Although the appeals court concluded that the appeal in the circuit was frivolous as well, the judges let the appellant off the hook by imposing only $1 in “nominal damages,” plus double costs against the client but not the lawyer.