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Eagle Force Holdings, LLC v. Campbell

Court of Chancery of Delaware

June 20, 2019

Eagle Force Holdings, LLC, et al.
v.
Stanley V. Campbell

          Submitted: May 31, 2019

         Dear Counsel:

         This letter opinion addresses Defendant Stanley Campbell's Motion for Certification of an Interlocutory Appeal and a Stay of This Court's Orders Dated April 23 and May 17, 2019.

         I. BACKGROUND

         On September 14, 2018, Plaintiffs filed their Motion for Contempt - Seeking Order Directing Campbell to Return Funds Taken from EagleForce Associates, Inc. During Appeal Period (the "Motion for Contempt"). The Motion for Contempt alleged that Campbell violated the July 23, 2015 Order Granting Plaintiff's Petition for Interim Relief (the "Status Quo Order"). On April 23, 2019, the Court held that the Status Quo Order bound Campbell during the appeal period and ordered the parties to inform the Court whether they would require an evidentiary hearing. On May 10, 2019, the Court granted the parties' stipulated proposed order wherein the parties agreed that (1) they did not require an evidentiary hearing on the Motion for Contempt and (2) Campbell must disgorge to EagleForce Associates, Inc., the amount of $1, 097, 558.47. On May 17, 2019, the Court ordered Campbell to disgorge the agreed-upon amount to EagleForce Associates, Inc., within twenty days from the date of the order.

         On May 31, 2019, Campbell filed his Motion for Certification of an Interlocutory Appeal and a Stay of This Court's Orders Dated April 23 and May 17, 2019 ("Motion for Certification" or "Motion for Stay"). On June 12, 2019, Campbell filed a letter to the Court requesting that the Court consider Plaintiffs' response waived. Campbell explained that under Supreme Court Rule 42, Plaintiffs' response was due on June 10 and Plaintiffs did not file a response or request an extension by that date.

         II. ANALYSIS

         A. Motion for Certification

         Supreme Court Rule 42 governs interlocutory appeals. An interlocutory appeal protects the right of litigants to review of a decision that may substantially damage those litigants' interests and may damage the interests of justice before final judgment. Rule 42, however, limits the availability of interlocutory appeals because they "disrupt the normal procession of litigation, cause delay, and can threaten to exhaust scarce party and judicial resources."[1] To balance these interests, Rule 42 demands a strict analysis by the trial court. The trial court may not certify an interlocutory appeal "unless the order of the trial court decides a substantial issue of material importance that merits appellate review before a final judgment."[2]

         In determining whether to certify an order for interlocutory appeal, the trial court must consider eight factors identified in Rule 42(b)(iii); make "its own assessment of the most efficient and just schedule to resolve the case"; and decide whether "the likely benefits of interlocutory review outweigh the probable costs."[3] "If the balance [of benefits and costs] is uncertain, the trial court should refuse to certify the interlocutory appeal."[4]

         The April 23, 2019 order held that Campbell was bound by the Status Quo Order during the appeal period because the Supreme Court had reversed this Court's September 1, 2017 post-trial memorandum opinion. Campbell argues that this holding addressed an issue of first impression in the State of Delaware: whether a party is bound by an interlocutory order during the period between post-trial judgment and reversal of that judgment. This order, however, did not decide a substantial issue of material importance because it did not "speak[] directly to the merits of the plaintiffs' claims."[5] Even if it did address a substantial issue of material importance and satisfy Rule 42(b)(iii)(A) relating to issues of first impression, in light of this case's current procedural posture, the probable costs of interlocutory appeal outweigh the likely benefits. This case is on remand. The parties have submitted all briefing; the Court held the related hearing; and this matter is under advisement. The Court will issue its final order in a matter of weeks. Given the subject of the interlocutory appeal and the anticipated timing of the final order, piecemeal litigation, even to address an issue of first impression, is not in the interests of justice. Therefore, this issue does not merit interlocutory appellate review. The most efficient and just schedule to consider an appeal of the April 23 and May 27, 2019 orders would be to do so in conjunction with appellate review of the final order, if any of the parties elects to pursue that course of action.

         Alternatively, certification of interlocutory appeal is inappropriate because Campbell's motion is untimely. Rule 42(c) delineates the procedure for certification of interlocutory appeals in the trial court:

(i) Application. -Such application shall be served and filed within 10 days of the entry of the order from which the appeal is sought or such longer time as the trial court, in its discretion, may order for good cause shown.
(ii) Response. -An opposing party shall have 10 days . . . after such service within which to serve and file a written response . . .;
(iii) Action by trial court. -Within 10 days after filing of the response or, if there is none, within 20 days after filing the application, the trial court shall enter an order certifying or refusing to certify the interlocutory appeal . . . .

         Three orders, taken together, resolve Plaintiffs' Motion for Contempt. Those orders are dated April 23, May 10, and May 17, 2019. Campbell seeks to appeal the holding of the April 23 order. Rule 42(c)(i) requires that the party file and serve "within 10 days of the entry of the order from which the appeal is sought or such longer time as the trial court, in its discretion, may order for good cause shown." The latest date Campbell could possibly use to calculate the deadline for his application is May 17, 2019, the date of entry for the last of the three orders. This date sets a deadline of May 28, 2019, for Campbell's application. Campbell filed the Motion for Certification on May 31, 2019.

         Campbell argues that his motion is timely because the April 23 order is not final until the Court resolves Plaintiffs' pending application for fees incurred in connection with the Motion for Contempt. Campbell's argument fails. An interlocutory order, by its very definition, is not a final order. Additionally, a pending request for award of attorneys' fees does not ...


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