Appellate Law

Order Removing Trustee in Ongoing Bankruptcy Proceeding is Appealable

By Greg May

As my first substantive post on this blog pointed out, determining whether a bankruptcy order is appealable can be tricky.  28 U.S.C. § 158(d) gives the Courts of Appeals jurisdiction over appeals from ?final decisions, judgments, orders, and decrees entered? either by the district courts or the Bankruptcy Appellate Panel.

In In re AFI Holding, Inc., case no. 06-56621 (9th Cir. June 17, 2008), the Ninth faces for the first time the issue of whether an order removing a trustee in an ongoing bankruptcy case is appealable, and, joining several other circuits, concludes that it is because it conclusively resolves a “discrete issue”:

Although the bankruptcy proceedings may continue, and here, in fact they have, the removal order resolves and seriously affects the substantive rights of the parties to a disinterested trustee and finally determines the discrete issue to which it is addressed?whether the bankruptcy court?s finding of a lack of disinterestedness was cause for the trustee?s removal under [11 U.S.C.]§ 324. 

See my earlier post for reference to a case that gives excellent guidance for evaluating the language of an order and the procedural posture of the bankruptcy case as aids in determining appealability.

Full post as published by The California Blog of Appeal on June 18, 2008 (boomark / email).