Seventh Circuit Clarifies Appealability of Orders in Ancillary Actions | Practical Law

Seventh Circuit Clarifies Appealability of Orders in Ancillary Actions | Practical Law

In P.H. Glatfelter Co. v. Windward Prospects Ltd., the US Court of Appeals for the Seventh Circuit held that where a district court enters an order in an ancillary action and that district court is located in the same circuit as the district court handling the main action, the order in the ancillary action is interlocutory and not immediately appealable.

Seventh Circuit Clarifies Appealability of Orders in Ancillary Actions

Practical Law Legal Update w-005-6990 (Approx. 3 pages)

Seventh Circuit Clarifies Appealability of Orders in Ancillary Actions

by Practical Law Litigation
Published on 03 Feb 2017 • USA (National/Federal)
In P.H. Glatfelter Co. v. Windward Prospects Ltd., the US Court of Appeals for the Seventh Circuit held that where a district court enters an order in an ancillary action and that district court is located in the same circuit as the district court handling the main action, the order in the ancillary action is interlocutory and not immediately appealable.
On January 31, 2017, in P.H. Glatfelter Co. v. Windward Prospects Ltd., the US Court of Appeals for the Seventh Circuit held that where a district court enters an order in an ancillary action and that district court is located in the same circuit as the district court handling the main action, the order in the ancillary action is interlocutory and not immediately appealable ( (7th Cir. Jan. 31, 2017)).
From the 1950s to 1970s, companies discharged waste water containing polychlorinated biphenyls in the Lower Fox River in Wisconsin. Under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), the parties responsible for creating the hazard and potentially responsible parties (PRPs) must pay for the cleanup. Appvion, Inc., a PRP, sued other PRPs including Glatfelter, in the US District Court for the Eastern District of Wisconsin, to recover the cleanup costs it incurred and to require other PRPs to pay for future remedial work.
To defend against Appvion, Glatfelter sought discovery related to Appvion's costs from Windward, an English entity allegedly conducting Appvion's defense of CERCLA claims and managing its cleanup operations. Glatfelter instituted this ancillary proceeding in the US District Court for the District of Massachusetts, seeking to compel Windward to respond to a subpoena and to transfer the case to the Eastern District of Wisconsin, where the cost recovery action was pending. The district court transferred the case, and the same judge presiding over the recovery action in the Eastern District of Wisconsin denied the motion to compel. Glatfelter also filed a motion to reconsider, which the court denied. Glatfelter appealed.
The Seventh Circuit dismissed the appeals for lack of jurisdiction, because the ancillary action here is in the same district court where the main action (the cost recovery action) is pending and Glatfelter could obtain review on appeal from the final judgment in the main action.
The court noted both the general rule that pretrial discovery orders are not final and therefore not appealable and that the appeals at issue here do not fit under the collateral order doctrine exception where there are no other means of obtaining review. The court found that:
  • The Seventh Circuit only recognized the appealability of pretrial discovery orders where they were issued by a district court in an ancillary proceeding and the district court was not in the circuit court that has appellate jurisdiction to review the final adjudication of the main action.
  • Other circuits to have directly considered the issue, including the US Courts of Appeals for the Second, Ninth, and Tenth Circuits, reached the same result.