United States District Court, D. Maryland, Southern Division
MEMORANDUM OPINION AND ORDER
W. Grimm United States District Judge
protracted Chapter 7 bankruptcy proceeding in the United
States Bankruptcy Court for the District of Maryland, Offit
Kurman, P.A. (“Offit Kurman”) served as Special
Counsel to Cheryl E. Rose, the Chapter 7 Trustee of the
Estate of Final Analysis, Inc. (“Trustee”).
In re Final Analysis, Inc., Bankr. No. 01-20139 TJC.
Offit Kurman and the Trustee's prior special counsel
filed a series of applications for compensation for services
rendered, see, e.g., ECF Nos. 3-57, 3-70, 3-76, 4-79
(Seventh Application, Eighth Application, Ninth and Final
Application, Tenth and Final Application), culminating in a
July 13, 2017 Final Application for Compensation and
Reimbursement of Expenses of Offit Kurman, P.A. as Special
Counsel to Cheryl E. Rose, Chapter 7 Trustee, ECF No. 3-42.
On August 21, 2017, the Bankruptcy Court signed an Order
Granting Application for Compensation for Offit Kurman, P.A.
as Special Counsel to Cheryl E. Rose, Chapter 7 Trustee
(“Order Granting Application”), which was entered
on the docket the next day. ECF No. 1-1.
Modanlo, a principal of the Debtor, has filed an appeal from
that Order Granting Application, ECF No. 1, and Offit Kurman
has filed a Motion to Dismiss Appeal, ECF No. 25, which the
parties fully briefed, ECF Nos. 28, 29. Having reviewed the
parties' briefs and the record, I find oral argument
unnecessary. See Fed. R. Bankr. P. 8012; Loc. R.
105.6. I conclude that this Court has jurisdiction over the
appeal and that Modanlo waived his right to challenge the
compensation and fees awarded in the Order Granting
Application. Accordingly, Offit Kurman's Motion IS
GRANTED, and Modanlo's appeal IS DISMISSED.
Kurman argues that this Court lacks jurisdiction to hear
Modanlo's appeal because the Order Granting Application
was not a final, appealable order. Appellee's Mot. 1.
Although Appellee presents this as a second, alternative
argument, jurisdiction must be addressed as a threshold
matter. See Steel Co. v. Citizens for a Better
Envir., 523 U.S. 83, 94-95 (1998) (“‘Without
jurisdiction the court cannot proceed at all in any cause.
Jurisdiction is power to declare the law, and when it ceases
to exist, the only function remaining to the court is that of
announcing the fact and dismissing the cause.' Ex
parte McCardle, 7 Wall. 506, 514, 19 L.Ed. 264 (1868).
‘On every writ of error or appeal, the first and
fundamental question is that of jurisdiction, first, of this
court, and then of the court from which the record comes.
This question the court is bound to ask and answer for
itself, even when not otherwise suggested, and without
respect to the relation of the parties to it.' Great
Southern Fire Proof Hotel Co. v. Jones, [177 U.S. 449');">177 U.S. 449,
453 (1900)]. The requirement that jurisdiction be established
as a threshold matter ‘spring[s] from the nature and
limits of the judicial power of the United States' and is
‘inflexible and without exception.' Mansfield,
C. & L.M.R. Co. v. Swan, 111 U.S. 379, 382, 4 S.Ct.
510, 511, 28 L.Ed. 462 (1884).”).
to 28 U.S.C. § 158(a), this Court has jurisdiction to
(1) from final judgments, orders, and decrees;
(2) from interlocutory orders and decrees issued under
section 1121(d) of title 11 increasing or reducing the time
periods referred to in section 1121 of such title; and
(3) with leave of the court, from other interlocutory orders
and decrees; of bankruptcy judges [in this District] entered
in cases and proceedings referred to the bankruptcy judges
under section 157 of [Title 28].
28 U.S.C. § 158(a). “Thus, by statute, an appeal
of right exists only from a final judgment, and any other
appeal, i.e., from an interlocutory order, may lie
only upon obtaining leave of the court.” Kore
Holdings, Inc. v. Rosen (In re Rood), 426 B.R. 538, 546
(D. Md. 2010).
context of a bankruptcy case, “the concept of finality
. . . has traditionally been applied ‘in a more
pragmatic and less technical way in bankruptcy cases than in
other situations.'” A .H. Robins Co., Inc. v.
Piccinin, 788 F.2d 994, 1009 (4th Cir. 1986). Indeed,
“Congress has long provided that orders in bankruptcy
cases may be immediately appealed if they finally dispose of
discrete disputes within the larger case.” Bullard
v. Blue Hills Bank, __ U.S. __, __, 135 S.Ct. 1686, 1692
(2015) (quoting Howard Delivery Serv., Inc. v. Zurich Am.
Ins. Co., 547 U.S. 651, 657 n.3 (2006)). This is because
“[a] bankruptcy case involves ‘an aggregation of
individual controversies,' many of which would exist as
stand-alone lawsuits but for the bankrupt status of the
debtor.” Id. (quoting 1 Collier on
Bankr. ¶ 5.08[b], at 5-42 (16th ed. 2014)).
Under this more relaxed standard, a bankruptcy “order
is final and appealable if it (i) finally determines or
seriously affects a party's substantive rights, or (ii)
will cause irreparable harm to the losing party or waste
judicial resources if the appeal is deferred until the
conclusion of the bankruptcy case.” Kore Holdings
(In re Rood), 426 B.R. at 547.
the order appealed from is an order granting an application
for compensation for a professional. It is true that
“[t]h general rule is that interim awards of
attorney's fees are interlocutory orders and therefore
not immediately appealable as a matter of right under 28
U.S.C. § 158(a).” In re Glob. Marine,
Inc., 108 B.R. 1009, 1010 (S.D. Tex. 1988) (emphasis
added) (citing In re Int'l Envtl. Dynamics,
Inc., 718 F.2d 322, 325 (9th Cir. 1983); Callister
v. Ingersoll-Rand Financial Corp. (In re Callister), 673
F.2d 305, 307 (10th Cir. 1982); In re Den-col Cartage
& Distribution, Inc., 20 B.R. 645 (D. Colo. 1982)).
But, Offit Kurman's application was a
Offit Kurman argues that, even though it titled its
application as a “Final Application, ” after the
application was filed, the Trustee learned of a new asset
and, with Modanlo's consent,
the Estate performed additional work to bring more funds into
the Estate from an unexpected source. Furthermore, the Estate
incurred additional fees to address Modanlo's
communication opposing the Application as well as to
participate in the appeal of the Order. As a result of
Modanlo's breach of the Agreement, the Estate may recover
the fees expended to administer the Estate and to address the
breach of the Agreement. The new, additional fees are damages
permitted by contract to the Estate ...