Gelboim v. Bank of America

PETITIONER: Ellen Gelboim
RESPONDENT: Bank of America Corp., et al.
LOCATION: British Bankers' Association, Pinners Hall

DOCKET NO.: 13-1174
DECIDED BY: Roberts Court (2010-2016)
LOWER COURT: United States Court of Appeals for the Second Circuit

CITATION: 574 US (2015)
GRANTED: Jun 30, 2014
ARGUED: Dec 09, 2014
DECIDED: Jan 21, 2015

ADVOCATES:
Seth P. Waxman - for the respondent
Thomas C. Goldstein - for the petitioner

Facts of the case

The London Interbank Offer Rate (LIBOR) is a daily interest rate benchmark that is used to help set the interest rate of financial transactions across the globe. Between August 2007 and May 2010, it has been alleged that the LIBOR rate was artificially manipulated downward by a number of colluding financial institutions. Ellen Gelboim was one of many parties to file individual suits against these financial institutions. Given the large number of cases, Gelboim's case was consolidated with a number of other similar cases for pre-trial purposes. During this pre-trial phase, the district court dismissed a number of the cases, including Gelboim's, for failure to state a claim. Gelboim sought to appeal the dismissal, however the U.S. Court of Appeals for the Second Circuit dismissed Gelboim's appeal and held that it lacked jurisdiction over the appeal because the district court had not entered a final order concerning all the claims in the consolidated action.

Question

Is a dismissed claim immediately appealable if the claim is part of a consolidated action and no final order has been issued concerning all claims in the action?

Media for Gelboim v. Bank of America

Audio Transcription for Oral Argument - December 09, 2014 in Gelboim v. Bank of America

Audio Transcription for Opinion Announcement - January 21, 2015 in Gelboim v. Bank of America

John G. Roberts, Jr.:

Justice Ginsburg has our opinion in Case 13-1174, Gelboim v. Bank of America.

Ruth Bader Ginsburg:

This case concerns the right to appeal from a Trial Court to an Appeals Court in the Federal Court system.

Two provisions of Title 28 of the US Code are relevant.

First, under Section 1291 an unsuccessful litigant in the Federal District Court has a right to appeal from a final decision rendered by the District Court.

Another provision, Section 1407, concerns multiple civil actions separately commenced in different District Courts, involving one or more common questions of fact.

Section 1407 instructs that all of the common question actions may be transferred to a single district for coordinated pretrial proceedings.

When pretrial ends any case not settled or finally decided without trial is returned to the originating District Court for trial.

The question presented, is the right to appeal that Section 1291 secures, is that right affected when a case is consolidated with many others pursuant to Section 1407 for pretrial proceedings?

In August 2011 the Multidistrict Litigation Panel consolidated for pretrial purposes several cases separately commenced against a number of banks.

The lawsuits allege that the defendant banks had conspired to manipulate the London Interbank Offered Rate, acronym LIBOR.

LIBOR is a benchmark interest rate used in determining interest rates for financial instruments worldwide.

The LIBOR Multidistrict Litigation comprises some 60 separate actions, all of them consolidated for pretrial proceedings in the US District Court for the Seventh District of New York.

One of the 60 odd actions so consolidated was a suit filed by petitioners Ellen Gelboim and Linda Zacher.

Purporting to represent a class of bondholders, Gelboim and Zacher asserted just one thing: that the banks they named as defendants through their participation in the LIBOR manipulation schemes have violated federal anti-trust law.

Moving on the bank's motion to dismiss, the District Court determined that no plaintiff in any of the LIBOR lawsuits could assert a cognizable anti-trust injury, and for that reason the Court dismissed the Gelboim-Zacher complaint.

Other cases in the massive LIBOR Multidistrict Litigation however presented federal instituted claims other than anti-trust claims and those claims remained before the District Court.

The Court of Appeals for the Second Circuit of its own initiative dismissed the Gelboim-Zacher appeal on the grounds that the order they appealed from did not dispose of all of the clams in the consolidated proceeding.

We reversed that judgment.

Cases consolidated for Multidistrict Litigation pretrial proceedings ordinarily retain their separate identities.

An order disposing of one of the discrete cases in its entirety, leaving nothing further for the District Court to do in that case we hold qualifies under Section 1291 as an appealable final decision.

The District Court order dismissing the Gelboim-Zacher complaint had the hallmarks of a final decision.

Ruling on the merits the District Court terminated their action, placing Gelboim and Zacher outside the consolidated proceeding and no longer committed to participate in it.

Nothing about the ongoing LIBOR Multidistrict Litigation proceeding renders the dismissal of the Gelboim-Zacher complaint in any way, tentative or incomplete.

The banks urge that in Section 1407 consolidation no appeal of right accrues until the consolidation ends.

Among other problems, that position would leave plaintiffs like Gelboim and Zacher in a quandary about the event that triggers the 30 day period for taking an appeal.

Must they remain outside the ballpark until all the other cases are settled was sent back to the Courts in which they originated.

The clear, simple, sensible answer to the appeal trigger, time begins to run when the Multidistrict Litigation Court grants a defendant's motion to dismiss with prejudice every claim or the sole claim made in a discrete case.

Contrary to the bank's suggestion, Gelboim and Zacher were not required to obtain certification from the District Court under Federal Rule of Civil Procedure 54(b) in order to appeal the dismissal of their complaint.

Rule 54(b) permits District Courts to authorize immediate appeal of dispositive rulings on separate claims in a civil action that involves multiple claims.

The rule is inapplicable to complaints that state only one claim.