TooBaRoo, LLC v. Olsen (In re Western Robidoux, Inc.)
- Summarized by David Treacy , U.S. Bankruptcy Court, Eastern District of Kentucky
- 2 months 2 weeks ago
- Case Type:
- Business
- Case Status:
- Dismissed
- Citation:
- 24-6006 (8th Circuit, Oct 21,2024) Published
- Tag(s):
-
- Ruling:
- The U.S. Bankruptcy Appellate Panel for the Eighth Circuit dismissed an appeal from a bankruptcy court's order granting a Chapter 7 Trustee's application to employ a law firm as special counsel. The order on appeal was not final under 28 U.S.C. § 158(a)(1) as it "did not resolve a discrete segment of the bankruptcy proceeding." The Panel declined to exercise its discretion to review the interlocutory order under 28 U.S.C. § 158(a)(3).
- Procedural context:
- Given its "independent obligation to examine [its own] jurisdiction," the Bankruptcy Appellate Panel sua sponte raised its jurisdiction to hear the appeal and required briefing from the parties on "whether the bankruptcy order is final under 28 U.S.C. § 158(a)(1), and alternatively, whether this court may review the order under 28 U.S.C. § 158(a)(3)."
- Facts:
- After Debtor Western Robidoux, Inc. filed a chapter 11 bankruptcy petition in the U.S. Bankruptcy Court for the Western District of Missouri, Debtor filed an application to employ attorney Daniel Blegen and his (then-current) law firm to represent them as special counsel in pending federal litigation. The parties adverse to Debtor in that litigation, Appellants TooBaRoo, LLC and InfoDeli, LLC, opposed the application, contending the attorney and firm held interests adverse to the estate. The bankruptcy court granted Debtor's application under 11 U.S.C. § 327(e). Debtor and its counsel had success in the litigation, leading to an appeal and cross-appeal. Attorney Blegen then joined a new law firm, Spencer Fane LLP. Debtor filed an application to employ Blegen and Spencer Fane as special counsel for the debtor related to the two filed appeals. No party opposed the application, which was approved. Subsequently, a third and a fourth appeal was filed in the federal litigation. After Debtor's case was converted to chapter 7, the newly appointed Chapter 7 Trustee, Appellee Jill Olsen, asked the bankruptcy court to allow Blegen and Spencer Fane to continue their work in the federal litigation on the estate's behalf, and the bankruptcy court approved the retention without opposition. When Olsen later filed a motion to approve Spencer Fane's application for fees and expenses, Appellees opposed the motion. To confirm Blegen and Spencer Fane were authorized to litigate the third and fourth appeals, Olsen filed an amended application to employ Spencer Fain as special counsel in all appeals related to the federal litigation. Appellants objected. The bankruptcy court granted the amended application, declining to disqualify counsel under § 327(c) and finding employment proper under § 327(e). Appellants appealed from the order granting the amended application.
- Judge(s):
- RIDGWAY, SURRATT-STATES, and JONES
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