Resolution Trust Corp. v. U.S. Fidelity and Guar. Co.

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_____________________
No. 94-30199
_____________________
RESOLUTION TRUST CORPORATION,
as Receiver for Pelican Homestead
and Savings Association,
Plaintiff-Appellant,
versus
UNITED STATES FIDELITY and GUARANTY
COMPANY,
Defendant-Appellee.
_________________________________________________________________
Appeal from the United States District Court
for the Middle District of Louisiana
_________________________________________________________________
(June 27, 1994)
Before KING, HIGGINBOTHAM and BARKSDALE, Circuit Judges.
PER CURIAM:
We consider the motion of the Resolution Trust Corporation
("RTC") to dismiss its own appeal in this case removed from
Louisiana state court. Concluding that the partial summary
judgment entered in the state court was not appealable under
Louisiana law and is not appealable under federal law, we DISMISS
the appeal.
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I. BACKGROUND
In April 1988, Pelican Homestead and Savings Association
("Pelican") filed suit in Louisiana state court against United
States Fidelity & Guaranty Company ("USF&G"). Pelican claimed
that the dishonest acts of one William C. Smith, Jr., caused it
to suffer losses and that those losses were covered under a
Savings and Loan Blanket Bond issued to it by USF&G. In November
1991, Pelican moved for partial summary judgment on the issue of
liability only; USF&G filed a cross-motion for summary judgment
on January 15, 1992.
On January 31, 1992, Pelican was closed and the RTC was
appointed as receiver for Pelican. On February 11, 1992, the
state court entered a judgment denying Pelican's motion for
partial summary judgment and granting in part and denying in part
USF&G's motion for summary judgment. Although we do not have the
reasons for the state court's decision (the judgment states that
the reasons were orally assigned), the state court's judgment
recites that summary judgment was granted in favor of USF&G on
counts 12, 13, 15, 16, 18, 19, 23, 24, and 25 and denied on
counts 1-11, 14, 17, 20, and 22. Neither party claims that a
motion or petition for appeal to the Louisiana Court of Appeals
was made by either party as required by LA. CODE CIV. PROC. ANN.
art. 2121 (West Supp. 1994). Several days later the RTC moved to
substitute as party plaintiff for Pelican; the state court
granted the motion and granted the RTC's motion to stay the
proceedings for ninety days on February 21, 1992.
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On April 28, 1992, the RTC removed the action to federal
district court pursuant to 12 U.S.C. § 1441a(l)(3)(a)(i). In May
1992, the RTC moved for a new trial or, in the alternative, for
reconsideration of the state court's judgment. USF&G filed a
cross-motion seeking the same relief in August 1992. The
district court requested supplemental briefing from the parties
regarding the proper disposition of the case in light of our
decision in FDIC v. Meyerland Co. (In re Meyerland Co.), 960 F.2d
512 (5th Cir. 1992) (en banc), cert. denied, 113 S. Ct. 967
(1993). The district court then entered an order denying the
parties' motions for new trial or for reconsideration of the
state court's judgment. The denial of the parties' motions is
reported at RTC v. United States Fidelity & Guar. Co., 838 F.
Supp. 276 (M.D. La. 1993). The court concluded that existing law
required it to take the state court judgment "in the same
condition in which it left the state system." Id. at 279.
Concluding that Louisiana recognizes partial summary judgments as
final, appealable judgments, the court held that the state
court's judgment was equally final and appealable in the federal
courts. Id. at 280. The court thus entered the state court
judgment as its own by order entered November 15, 1993, and
directed the parties to follow federal procedures applicable
following entry of a final judgment. The RTC filed a second
motion for new trial, which was denied on February 24, 1994.
The RTC filed a notice of appeal of the three district court
orders; it has also filed a motion to dismiss the appeal. USF&G
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agrees that the appeal should be dismissed, but contends that the
RTC, in its motion to dismiss the appeal, is surreptitiously
seeking the same relief that it would be seeking on appeal.
Indeed, the RTC asks us not only to dismiss the appeal but also
to remand the case to the district court with instructions to
vacate its previous judgments adopting the state court judgment
and to administer the case to its conclusion.
II. ANALYSIS
The question posed is whether we have jurisdiction to hear
this appeal. We begin our analysis with a review of our en banc
decision in Meyerland.
A. MEYERLAND AND ITS PROGENY
In Meyerland, Continental Savings Association
("Continental") was sued in state court for, among other things,
usury and fraud. 960 F.2d at 514. The plaintiffs won in the
trial court and Continental appealed. Id. After the appeal was
filed, the Federal Savings and Loan Insurance Corporation
("FSLIC") was appointed as receiver for Continental, and the
FSLIC removed the case to federal district court. Id. The
district court remanded to state court. Id. Soon thereafter
Congress enacted the Financial Institutions Reform, Recovery, and
Enforcement Act ("FIRREA"), Pub. L. No. 101-73, 103 Stat. 183
(1989). Id. The Federal Deposit Insurance Corporation ("FDIC")
succeeded the FSLIC as receiver for Continental, and the FDIC
then removed the case pursuant to its statutory authority, 12
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U.S.C. § 1819(b)(2)(B). Id. The federal district court again
remanded, and the FDIC appealed. Id. One of the questions posed
was whether § 1819(b)(2)(B) authorizes the FDIC to remove state
court appellate proceedings. Id.
We held that § 1819(b)(2)(B) does allow removal after entry
of final judgment by a state trial court and before all appeals
are exhausted. Id. at 520. This result, we concluded, was most
consistent with the plain language of the statute, id. at 516-17,
was within Congress' power to define the jurisdiction of the
federal courts, id. at 517, and was consistent with Congress'
general objective in enacting FIRREA, which was to increase the
FDIC's ability to carry out its regulatory and enforcement
responsibilities, id. at 519-20. As for the procedural effects
of post-judgment removal, we held that the district court should
"take the state judgment as it finds it, prepare the record as
required for appeal, and forward the case to a federal appellate
court for review." Id. at 520. Citing Granny Goose Foods, Inc.
v. Brotherhood of Teamsters, Local No. 70, 415 U.S. 423, 435-36
(1974), we concluded that the case "simply comes into the federal
system in the same condition in which it left the state system."
Meyerland, 960 F.2d at 520. For instance, if the notice of
appeal was adequate to perfect an appeal in the state system, we
stated that the notice should be deemed adequate in the federal
courts regardless of any differences in technical requirements
between the state and federal systems. Id.
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 Pursuant to 12 U.S.C. § 1441a(l)(3), the RTC possesses broad
removal powers similar to those of the FDIC under §
1819(b)(2)(B). Section 1441a(l)(3)(A) provides, in pertinent
part:
The [RTC], in any capacity and without bond or
security, may remove any action, suit, or proceeding from a
State court to the United States district court with
jurisdiction over the place where the action, suit, or
proceeding is pending[.]
We have therefore applied the holding in Meyerland to cases
involving the RTC. E.g., 5300 Memorial Investors, Ltd. v. RTC
(In re 5300 Memorial Investors, Ltd.), 973 F.2d 1160 (5th Cir.
1992).
The RTC argues that this case presents a problem that we
created but did not resolve in Meyerland. Implicitly accepting
the district court's conclusion that the partial summary judgment
would have been appealable in Louisiana's court system, the RTC
contends that federal rules governing the appealability of orders
should control in cases in which the state court prior to removal
entered an order that would have been immediately appealable
under state law. The general rule in the federal courts, of
course, is that partial summary judgments are not appealable.
Gray Line Motor Tours, Inc. v. City of New Orleans, 498 F.2d 293,
295 (5th Cir. 1974); see also 10 CHARLES A. WRIGHT ET AL., FEDERAL
PRACTICE AND PROCEDURE § 2715, at 631-634 (2d ed. 1983) ("[A] partial
summary judgment determining that a certain issue be established
for the trial of the case generally is not appealable until after
the case has been tried."). In Louisiana, however, a partial
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judgment may be considered a final judgment, LA. CODE CIV. PROC.
ANN. art. 1915(A) (West Supp. 1994), and can be immediately
appealable, art. 1915(B), under some circumstances. See, e.g.,
Graham v. Southern Pac. Transp. Co., 619 So. 2d 894, 898 (La. Ct.
App.) (holding that a partial summary judgment that a railroad
was not negligent in failing to install active signals at a
railroad crossing was not appealable after trial because it
should have been immediately appealed), writ denied, 625 So. 2d
1044 (La. 1993). We have found no court of appeals decision on
point, although the Third Circuit has hinted in dicta that no
federal appellate jurisdiction would exist on these facts. RTC
v. Nernberg, 3 F.3d 62, 68 (3d Cir. 1993) ("[S]ome matters
properly on appeal in the state courts would conceivably not be
appealable in the federal system. For example, the United States
Courts of Appeals lack jurisdiction over appeals from some
interlocutory orders and orders for new trials that state
appellate courts may have authority to review.").
We find, however, that we need not decide this difficult
question because the district court misinterpreted Louisiana law
in concluding that the instant partial summary judgment would
have been immediately appealable in the Louisiana courts.
B. LOUISIANA LAW REGARDING IMMEDIATE
APPEALS FROM PARTIAL SUMMARY JUDGMENTS
Up to this point we have assumed the accuracy of the
district court's holding that the partial summary judgment
entered by the state court in the instant case would have been
immediately appealable. Before proceeding further, however, we
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must scrutinize this holding closely. If the judgment entered by
the Louisiana state court and adopted by the district court was
not final and immediately appealable under Louisiana law, then
the district court erred in concluding (1) that it lacked the
power to examine the state court judgment under federal summary
judgment standards and (2) that immediate appellate review of the
state judgment was available from this court. We review the
district court's interpretation of state law de novo. Salve
Regina College v. Russell, 499 U.S. 225, 231 (1991); Commons W.
Office Condos, Ltd. v. RTC, 5 F.3d 125, 127 (5th Cir. 1993).
The Louisiana Supreme Court recently considered the problem
of piecemeal appeals in Everything on Wheels Subaru, Inc. v.
Subaru South, Inc., 616 So. 2d 1234 (La. 1993). That case arose
in the context of an action for wrongful termination of
franchise. Id. at 1235. The plaintiff sued for damages based on
four theories, and the defendant filed an exception of no cause
of action, which is the Louisiana equivalent of a Rule 12(b)(6)
motion. See id. ("The function of an exception of no cause of
action is to test the legal sufficiency of the petition by
determining whether the law affords a remedy on the facts alleged
in the pleading."). The trial court maintained the exception as
to only two of the plaintiff's theories and granted an immediate
appeal. Id. The Louisiana Supreme Court took the opportunity to
clarify the rules governing the appealability of partial final
judgments rendered on exceptions of no cause of action. Most
important for our purposes, the court concluded that a partial
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final judgment on an exception of no cause of action that does
not dismiss any party and adjudicates some but not all claims,
defenses, or issues, is an interlocutory judgment not appealable
in the absence of a showing of irreparable injury. Id. at 1241-
42. The court clearly desired to ensure that "there is only one
appeal in most cases." Id. at 1242.
The Everything on Wheels court explicitly limited its
decision to partial final judgments rendered on exceptions of no
cause of action. Id. at 1241 n.12. It reserved the question of
"whether a partial judgment on a motion for summary judgment,
that merely decides one of several claims, defenses or issues
without dismissing any party . . . must be appealed immediately
in order to prevent the judgment from acquiring the authority of
the thing adjudged." Id. The clear hint, however, was that the
same rules should govern both kinds of partial final judgments.
Id. ("There does not appear to be any logical reason to treat
partial judgments resulting from a motion for summary judgment
any differently from partial judgments resulting from an
exception of no cause of action.").
The court of appeals that decided the Graham case did not
mention Everything on Wheels in reaching its conclusion that a
partial summary judgment in favor of one defendant on one theory
of liability had been final and appealable when entered by the
trial court. Graham, 619 So. 2d at 898. A more recent court of
appeals case, however, came to the opposite conclusion. In Caire
v. Fremen, 630 So. 2d 297, 297-98 (La. Ct. App. 1993), the
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plaintiff sued the other driver in a traffic accident and his
insurer. The action against the insurer included a direct action
claim under Louisiana's direct action statute and a claim for
arbitrary refusal to pay a claim; the trial court granted the
insurer partial summary judgment on the latter claim only. Id.
at 298. The court of appeals dismissed the appeal from the
partial summary judgment, concluding that the judgment was an
interlocutory judgment not appealable in the absence of a showing
of irreparable injury, relying on Everything on Wheels. Id. at
299.
The Caire reading of Everything on Wheels appears to us to
be correct, and we conclude that the partial summary judgment
rendered in favor of USF&G in the instant case was interlocutory
and unappealable under both Louisiana and federal law. In the
absence of a final, appealable judgment from the district court,
we are without jurisdiction. Kahlil, 978 F.2d at 184. In the
absence of an appealable order from the district court, the RTC's
notice of appeal was ineffective either to divest the district
court of jurisdiction or to confer jurisdiction on this court.
Id. This case does not pose the difficult question of whether we
would have jurisdiction to review a state court order that is
immediately appealable under state law but interlocutory and
unappealable under federal law, and we express no opinion
regarding that question.
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III. CONCLUSION
Because we lack jurisdiction to hear this appeal, IT IS
ORDERED that the motion of appellant to dismiss this appeal is
GRANTED.
IT IS FURTHER ORDERED that the motion of appellant to
suspend appellant deadlines pending consideration of its motion
to dismiss the appeal is DENIED as moot.
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