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01-2691 SEC v. Van Waeyenberghe, et al.

By: dmc-admin//April 1, 2002//

01-2691 SEC v. Van Waeyenberghe, et al.

By: dmc-admin//April 1, 2002//

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“Arnstein & Lehr contends that the turnover order is final and appealable under sec.1291 as a ‘collateral order’; it does not contend that this order is appealable as an interlocutory injunction under 28 U.S.C. sec.1292 or that any other statute authorizes an appeal. Contrast Grupo Mexicano de Desarrollo, S.A. v. Alliance Bond Fund, Inc., 527 U.S. 308 (1999). Nor is this an appeal by Van Waeyenberghe or First Choice contending that the order will undermine or preclude defense of the pending litigation, and thus can be analogized to the security bond in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541 (1949). Cf. Herbstein v. Bruetman, 241 F.3d 586 (7th Cir. 2001). Instead it is a creditor’s appeal, and the only fight is over interim custody of funds.”

“The collateral-order doctrine allows immediate appeal of decisions that are ‘conclusive, that resolve important questions separate from the merits, and that are effectively unreviewable on appeal from the final judgment in the underlying action.’ Swint v. Chambers County Commission, 514 U.S. 35, 42 (1995). It is hard to see how any of these requirements is satisfied. No turnover order is ‘conclusive’; the order determines only who holds the stakes while the litigation proceeds. If Van Waeyenberghe and First Choice prevail, then the funds will be handed back to Arnstein & Lehr. This also shows that the decision cannot be called ‘unrelated to the merits’; it is entangled with the merits. Finally, Arnstein & Lehr will have a remedy by appeal from any order treating the funds as available for distribution to creditors. It may make then all of the arguments it advances now. Arnstein & Lehr disputes this final point, contending that, because it has withdrawn as counsel, it cannot appeal from the final judgment. But its appeal would not be as counsel; it would be as creditor. The reasons we have canvassed show why courts routinely treat as non- final orders to turn assets over to receivers pending further adjudication. See, e.g., FTC v. Overseas Unlimited Agency, Inc., 873 F.2d 1233 (9th Cir. 1989); United States v. Beasley, 558 F.2d 1200 (5th Cir. 1977). We see no good reason why this appeal should be handled differently.”

Dismissed.

Appeal from the United States District Court for the Northern District of Indiana, Miller, J., Per Curiam.

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