Note: Last week the Roundtable concluded its series on crypto bankruptcies. We will resume our regular posts beginning with this week’s post, featuring an article by attorney Michael L. Cook.
By Michael L. Cook (Schulte Roth & Zabel LLP)
This essay shows why a bankruptcy court preliminary injunction should be reviewable on appeal by an Article III court. District courts are split on the issue, often declining to review these rulings on the grounds that they are not “final” and that review is unwarranted. Although the Third, Seventh and Eighth Circuits hold that the Judicial Code authorizes appellate review, only the Second Circuit disagrees, based on a blinkered reading of the Judicial Code and U.S. Supreme Court precedent.
A district court’s preliminary injunction ruling (granting or denying) is concededly subject to review by a court of appeals under the explicit terms of the Judicial Code. Sound policy reasons, common sense and the obligation of the federal courts to hear cases within their statutory jurisdiction also show that bankruptcy court injunction rulings should not be insulated from appellate review. No sound reason exists for treating these bankruptcy court rulings differently from an identical district court ruling.
The full article is available here.