Credit Francais International v. Bio-Vita, Ltd.

UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT

No. 94-1854

CREDIT FRANCAIS INTERNATIONAL, S.A.,
Plaintiff, Appellee,

v.

BIO-VITA, LTD., HEMO-INNOVATIONS, LTD.,
Defendants, Appellants.

No. 95-1091

BIO VITA, LTD., ET AL.,
Plaintiffs, Appellees,

v.

CARL W. RAUSCH, ET AL.,
Defendants, Appellants,

IDEAL ENVIRONMENTAL SYSTEMS, INC.,
Counterclaimant, Appellant.

No. 95-1092

BIO VITA, LTD., ET AL.,
Plaintiffs, Appellees,

v.

CARL W. RAUSCH, ET AL.,
Defendants, Appellees,

PETER FISHER & BALFOUR HOLDINGS, INC.,
Counterclaimants, Appellants.

APPEALS FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. James L. Watson,* Senior Judge]

Before

Selya, Circuit Judge,

Campbell, Senior Circuit Judge,

and Cyr, Circuit Judge.

David M. Mermell on Opposition to Motion to Vacate Order

Dismissing Appeal for appellants, Bio-Vita, Ltd. and Hemo-Innovations,
Ltd.
S. Elaine McChesney, with whom Robert A. Buhlman and Bingham,

Dana & Gould were on brief for appellees Biopure Corporation, Biopure

Associates Limited Partnership and Carl W. Rausch.
James B. Hicks, with whom Kathy A. Jorrie, Andrews & Kurth

L.L.P., Evan Slavitt and Hinckley, Allen & Snyder were on brief for

appellants, Peter Fisher, Balfour Holdings, Inc. and Ideal
Environmental Systems, Inc.
Marc S. Palay, with whom Eric W. Bloom, Winston & Strawn, Jerome

M. Leonard, John D. Donovan, Jr. and Ropes & Gray were on brief for

appellee, Credit Francais International, S.A.

February 29, 1996

*Of the United States Court of International Trade, sitting by
designation.

2

CYR, Circuit Judge. In this consolidated, multiparty
CYR, Circuit Judge

proceeding, the district court entered two separate summary

judgment orders for intervenor CFI.1 The first judgment was

against Trainor and awarded CFI a constructive trust over Trai-

nor's "choses in action" against Biopure. The second judgment

awarded CFI similar relief against Fisher. The second judgment

was also favorable to Biopure. Each judgment was certified,

though at different times, as final and immediately appealable

under Fed. R. Civ. P. 54(b).

The two judgments spawned appeals by three parties.

Trainor appealed from the first judgment, but then voluntarily

dismissed the appeal. Fisher noticed an appeal from the second

judgment, along with a purported "cross-appeal" from the first

judgment, as did Ideal. Fisher and Ideal also moved to vacate

the voluntary dismissal of the Trainor appeal.

Based on a thorough record review, we conclude that:

1The various parties are referred to as follows:

"Fisher" collectively designates Peter Fisher and
Balfour Holdings, Inc. ("Balfour"), an entity con-
trolled by Fisher.

"Ideal" designates Ideal Environmental Systems, Inc.

"Trainor" collectively designates William Trainor, his
daughter Diane Trainor, and Trainor-controlled compa-
nies, Bio-Vita, Ltd. ("Bio-Vita"), Hemo-Innovations,
Ltd. and Laurel Mountain Trust ("LMT").

"Biopure" collectively designates Biopure Corporation
and Biopure Associates Limited Partnership ("BALP"), as
well as Carl W. Rausch.

"CFI" designates Credit Francais International, S.A.

3

(1) the Ideal appeal was filed late and, in all events, Ideal

lacks standing to appeal; (2) the Trainor appeal was properly

dismissed; (3) the Fisher "cross-appeal" brief challenging the

first judgment should be stricken; and (4) the court lacks

appellate jurisdiction over Fisher's challenge to the second

judgment.

At the outset, we note that our consideration of these

appeals has been severely hampered by the failure of Fisher and

Ideal to conform their briefs and appendices as required by the

applicable rules. Their briefs do not include necessary juris-

dictional information, a meaningful description of the district

court proceedings, nor comprehensible record references. See

Fed. R. App. P. 28(a)(2)(ii), (a)(4), (e). The first three

volumes of their appendices, approximating 2500 pages, are poorly

indexed, not in chronological order, and not consecutively

paginated. See Fed. R. App. P. 30(d). Prior to oral argument,

despite a careful search of the appendices and the eight volumes

of record originally designated on appeal, we were unable to

locate crucial pleadings and exhibits, including documents

referenced in appellants' own briefs.

At oral argument, these matters were brought to appel-

lants' attention and we invited an appropriate motion. Appel-

lants later sought and were granted leave to file a two-volume

supplemental appendix consisting of an additional 1400 pages.

The supplement contains many but not all of the missing

documents. It also contains, however, unindexed documents of

4

uncertain relevance, some of which may not have been before the

district court. Moreover, appellants did not seek leave to

repaginate and rearrange the first three volumes of their appen-

dices, obliquely explaining instead that these volumes "have been

used by the Court and parties for over three months." And they

failed to revise their record references to the documents cited

in their briefs. See Fed. R. App. P. 30(c).

It is appellants' responsibility to provide the court

with intelligible briefs and appendices sufficient to support

their points on appeal, United States v. One Motor Yacht Named

Mercury, 527 F.2d 1112, 1113 (1st Cir. 1975), failing which "the

court in its discretion . . . may scrutinize the merits of the

case insofar as the record permits, or may dismiss the appeal if

the absence of a [record] thwarts intelligent review." Moore v.

Murphy, 47 F.3d 8, 10 (1st Cir. 1995). Accordingly, in the

instant case, wherever material uncertainties result from an

incomplete or indecipherable record and impede or affect our

decision, we resolve such uncertainties against appellants. See

Real v. Hogan, 828 F.2d 58, 60 (1st Cir. 1987) ("It is the

appellant who must bear the brunt of an insufficient record on

appeal."). With this caveat, we recount the background facts as

best we can.

I
I

BACKGROUND
BACKGROUND

Although significant differences distinguish the

parties' versions of the relevant facts, we recite the skeletal

5

scenario upon which the parties predicate their claims.

Trainor, the central figure in the dispute, allegedly

defrauded all the other parties. Fisher entered into a joint

venture with Trainor to invest in, and develop, Biopure's hemo-

globin-based products. Each partner was to contribute 50% of the

capital needed to finance their undertaking. Trainor was respon-

sible for negotiating a contract with Biopure. Fisher was to

arrange for human testing of a Biopure product Hemopure in

Guatemala.

Earlier, acting through Ideal as the nominal borrower,

Trainor had obtained more than $14 million from CFI in a fraudu-

lent loan transaction. Although Fisher likewise was involved in

the CFI loan transaction, his knowledge of the fraud perpetrated

by Trainor remains in dispute. Trainor used approximately $3

million in "tainted" CFI loan proceeds to finance the Biopure

contract. These monies have been traced directly from Trainor's

bank account to the Biopure deal. The "ownership" of this $3

million at the time it was invested in Biopure is a contested

matter as between Fisher and Ideal.

Allegedly at about the same time, Trainor secretly

forced Fisher out of the Biopure deal by substituting Bio-Vita,

Trainor's own company, as the named party to the contract with

Biopure. The contract entitled Trainor to an equity interest in

Biopure and licensing rights to the Biopure products. Biopure

subsequently rescinded the contract and awarded similar equity

and licensing rights to Upjohn. According to Fisher, by then the

6

rights licensed to Upjohn were worth at least $179 million.

7

The District Court Proceedings
The District Court Proceedings

Fisher sued Trainor, and later Biopure, for $250

million or a 50% share in the Biopure rights ("Fisher v. Trai-

nor"). Trainor then sued Biopure. Biopure counterclaimed

against Trainor for fraud, adding Fisher as a third party defen-

dant in the Trainor lawsuit ("Trainor v. Biopure"). Fisher's

third party answer included a counterclaim against Trainor

seeking to impose a constructive trust upon any Trainor recover-

ies from Biopure.

The first count in the Fisher v. Trainor complaint was

tried to a jury in November, 1992, resulting in a special verdict

that Trainor had breached a binding oral contract with Fisher

whereby the two were to have shared equally in the Biopure deal.

A mistrial was declared later, however, because Trainor and

Fisher were unable to agree on the meaning of the special verdict

and how to proceed with respect to the separate action in Trainor

v. Biopure. We denied Fisher's ensuing petition for a writ of

mandamus. In re Peter Fisher & Balfour Holdings, Inc., 7 F.3d

218 (Table), No. 93-1914 (1st Cir. Oct. 12, 1993), cert. denied,

114 S. Ct. 1299 (1994).

CFI then intervened in the Trainor v. Biopure action,

claiming a constructive trust over the Trainor and Fisher rights

against Biopure. CFI also demanded judgment on certain direct

claims against Biopure.

The district court first entered summary judgment for

CFI and against Trainor, imposing a constructive trust upon

8

Trainor's claims against Biopure based on findings that: (1)

Trainor's fraud against CFI was undisputed,2 (2) CFI had traced

approximately $3 million of its loan funds through Trainor to the

Biopure investment, and (3) all monies advanced by Trainor in

furtherance of the Biopure deal were traceable to CFI.

Fisher did not oppose CFI's motion for summary judgment

against Trainor, but ambiguously purported to reserve a right to

demand a share of Trainor's rights in the Biopure transaction.

The district court accordingly ruled,

[T]he court notes the existence of another
claim to rights arising from the transaction
with Biopure . . . Fisher claims to have had
a joint venture agreement with Trainor to
share in the outcome of the transaction with
Biopure . . . [T]his opinion does not address
his claims and their effect, if any, on CFI's
constructive trust.

June 28, 1994 Order at 6. The district court certified the CFI

summary judgment against Trainor as final under Rule 54(b), and

judgment entered on July 1, 1994.

Trainor filed a premature notice of appeal shortly

after Fisher moved to amend the judgment pursuant to Fed. R. Civ.

P. 59(e), notwithstanding Fisher's earlier decision not to

interpose objection to the CFI motion for summary judgment.

Contemporaneously, Fisher filed a "first amended counterclaim"

which purported to add Ideal as a party to the pending litigation

2This finding was predicated in substantial part on an
earlier Ohio consent judgment for fraud against Trainor. In the

same Ohio action, a default judgment was entered against Ideal
and remains outstanding, according to CFI, because Ideal is
defunct.

9

for the first time. Ideal also purported to join as a party in

the Rule 59(e) motion to amend the earlier Trainor judgment.3

In response to a motion to strike the amended counterclaim,

Fisher and Ideal formally moved for leave to amend it by, inter

alia, "adding Ideal as a party plaintiff." Finally, CFI and

Biopure moved for summary judgment against Fisher.

On November 22, 1994, the district court issued a

memorandum opinion denying the Rule 59(e) motion to amend,

striking as untimely the first amended counterclaim which had

attempted to insinuate Ideal as a party to the case, and granting

the Biopure and CFI motions for summary judgment against Fisher.

Based on its conclusion that the only claims Fisher had asserted

against Biopure were those Fisher and Trainor jointly held

against Biopure, the district court ruled: "there is no ground

whatsoever in law or equity that gives Fisher a right to share in

the benefits of his co-venturer's fraud to the detriment of a

prior innocent party."

The district court's memorandum order provides the

following explanation for its decision to enter a second Rule

54(b) certification, covering the summary judgments against

Fisher:

3The docket sheets list two Rule 59(e) motions filed on the
same day, one by Ideal and one by Fisher, but we can locate only
one such motion in the appendix and record. It purports to have
been "submitted" by both Fisher and Ideal, although it is titled
"Ideal's Motion to Alter or Amend Judgment." Fisher complains
that the district court never ruled on his motion. Given the
record before us, however, we conclude that there was a single,
joint motion, which was denied by the court. See accompanying

text.

10

In the opinion of the court the granting of
these motions for summary judgment is likely
to lead to the simplification of the case and
the elimination of a future trial. For this
reason the court finds it advisable to make
these judgments final under Rule 54(b). The
court finds no just reason to delay final
judgment on these matters.

Nov. 22, 1994 Order at 13.

On December 6, 1994, a "separate document," incorporat-

ing the second Rule 54(b) judgment, was entered on the district

court docket:

In accordance with this Court's Memorandum,
Opinion and Order entered on November 22,
1994, IT IS HEREBY ORDERED:

Judgment is entered in favor of Biopure and
Credit Francais International, S.A. ("CFI")
as against Balfour Holdings, Inc. and Peter
Fisher.

By supplementary order under Rule 60(a), the district court noted

the pendency of additional, unspecified claims, but reiterated

its intention to certify the second Rule 54(b) judgment for

immediate appeal "in the interests of justice." As best we can

glean from the record, at that time all claims remained pending

(with CFI substituted as plaintiff on some) and all parties

remained in the case on other claims.

The Appeals
The Appeals

Following the denial of the Rule 59(e) motions to

amend, Trainor reinstated his appeal from the July 1, 1994

judgment (No. 94-1854). See Fed. R. App. P. 4(a)(4). On January

3, 1995, Fisher and Ideal each filed a notice of appeal. The

Fisher notice, a single document titled "Notice of Appeal and

11

Cross-Appeal," purported to notice an appeal from the December 6

judgment and a "cross-appeal" from the July 1 judgment.4 The

Ideal notice, identically titled, likewise purported to notice an

appeal from the December 6 judgment and a "cross-appeal" from the

July 1 judgment, as well as another "cross-appeal" from the

December 6 judgment, identified only as taken in response to

Fisher's notice of appeal. The Fisher notice was docketed as No.

95-1092; the Ideal notice as 95-1091. Trainor and CFI jointly

moved for voluntary dismissal of the Trainor appeal on March 20,

1995, and the motion was granted the same day. Fisher and Ideal

moved to vacate the voluntary dismissal.5

I. Standing to Appeal (No. 95-1091)
I. Standing to Appeal (No. 95-1091)

Notwithstanding the wording of its notice of appeal,

Ideal has attempted to join in the Fisher challenge to two

district court orders: the denial of the Rule 59(e) motion to

amend the first judgment (referred to as a "cross-appeal"), and

the denial of the motion to amend the Fisher counterclaim. Ideal

was not a party of record before the district court. Its stand-

4The term "cross-appeal" is a misnomer in this context. It
normally denotes an appeal by an initial appellee against the
initial appellant from an order or decision entered in favor of
the initial appellant. See 9 James Wm. Moore, Moore's Federal

Practice 204.11[1] (1995). Fisher and Ideal were not named as

appellees in the Trainor appeal, and their so-called "cross-
appeals," as a logical matter, were separate appeals from the

first judgment in favor of appellee CFI, not the original appel-
lant Trainor. Ideal's additional "cross-appeal" against
Fisher is simply an enigma.

5We reserved decision on this motion pending oral argument.
Fisher and Ideal then filed an opaque motion to consolidate the
dismissed and pending appeals, which we denied.

12

ing to appeal thus turns on whether its attempted appellate

challenges are excepted from the general rule that only parties

to the district court proceedings may appeal a district court

judgment. See United States v. Little Joe Trawlers, Inc., 780

F.2d 158, 161 (1st Cir. 1986). By itself, the Ideal challenge to

the denial of the Rule 59(e) motion, briefed separately under the

rubric "cross-appeal," appears to come within no exception to the

general rule.

Nonetheless, the denial of Ideal's motion to amend the

Fisher counterclaim by, inter alia, "adding Ideal as a party

plaintiff," may have been an appealable order. As the nominal

borrower of the funds loaned by CFI, Ideal claims that it, not

CFI, was entitled to assert a constructive trust over the equity

claims acquired by Trainor when he wrongly diverted the loan

proceeds to Biopure.6 Ideal thus asserts an interest at least

superficially akin to those cognizable under Fed. R. Civ. P.

24(a)(2).7

An order denying a motion to intervene of right is

6There are no district court findings which would enable
confident determinations as to who controlled Ideal at various
material times. Moreover, the record suggests that Ideal was a
shell, wholly owned and controlled by Trainor, at the time of the
CFI loan. During the CFI loan transaction ("in or about 1989"),
however, Fisher allegedly gained control of Ideal.

7See supra note 6. Ideal purports to be a bona fide pur-

chaser of the CFI loan proceeds, so as to cut off any right CFI
might have to "trace" its loan funds into the Biopure deal.
Ideal claims that, through Fisher, it innocently acquiesced in
the CFI loan arranged by Trainor, then innocently redirected the
loan proceeds to Trainor (allegedly for the purchase of a worth-
less landfill). Trainor used the money to finance the Biopure
deal.

13

immediately appealable, without the need for certification under

Rule 54(b). Flynn v. Hubbard, 782 F.2d 1084, 1086 (1st Cir.

1986); 6 James Wm. Moore et al., Moore's Federal Practice 54.38

n.4 (1995). The appeal cannot be kept in reserve; it must be

taken within thirty days of the entry of the order, or not at

all. See B.H. by Pierce v. Murphy, 984 F.2d 196, 199 (7th

Cir.), cert. denied, 113 S. Ct. 2930 (1993). As Ideal filed no

timely notice of appeal from the denial of its motion to inter-

vene, we lack jurisdiction over its appeal. The thirty-day

appeal period extended from the date of entry (November 28, 1994)

of the November 22, 1994, order denying intervention, see Fed. R.

App. P. 4(a)(1),8 and Ideal did not file its notice of appeal

until January 3, 1995.9 Appeals from the First Judg-
Appeals from the First Judg-

8The entry of the Rule 54(b) judgment against Fisher on
December 6, 1994, did not enlarge the appeal period, for two
reasons. The judgment did not include Ideal's claims and, as an
exception to Rule 54(b), the denial of intervention was appeal-
able without an "express direction for the entry of judgment" on
a separate document. Cf. Willhauck v. Halpin, 953 F.2d 689, 701

(1st Cir. 1991). Since Ideal sought intervention in the still-
pending litigation, and not relief from a final judgment, there
is no reason to consider further the applicability of the "sepa-
rate document" rule in relation to the denial of this motion.
Compare infra note 12.

9Ideal did not move for an extension of time to appeal the
denial of its motion to intervene/amend the counterclaim, al-
though it joined Fisher in a motion to extend the time to file
the so-called "cross-appeal" from the first judgment. The latter
request was denied for failure to show good cause or excusable
neglect.
We simply add that the district court did not abuse its
discretion in denying the motion to amend/intervene as untimely.
See Conservation Law Found. v. Mosbacher, 966 F.2d 39, 41 (1st

Cir. 1992). The case had been pending since 1990, the CFI loan
transaction had been addressed in pleadings dating back to April,
1991, and CFI had moved to intervene ten months before the
attempted counterclaim. The court rightly explained that "so

14

ment: the Fisher "Cross-Ap-
ment: the Fisher "Cross-Ap-

peal" and the Voluntary Dis-
peal" and the Voluntary Dis-

missal of the Trainor Appeal
missal of the Trainor Appeal

Fisher contends that the voluntary dismissal of the

Trainor appeal should be vacated, as a collusive attempt to

foreclose his so-called "cross-appeal" from the same judgment.10-

CFI and Trainor respond that Fisher has no standing to oppose

dismissal of the Trainor appeal, nor to appeal from the first

judgment in his own right, because he elected initially not to

contest CFI's motion against Trainor below.11 Fisher's stand-

much blood has passed under the bridge" that it would work a
"perversion" of the liberal amendment policy of Rule 15 to permit
Ideal to introduce a new claim so late in the proceedings. Other
"timeliness" criteria weighed against Ideal as well. First,
appellees would have been unfairly prejudiced had intervention
been allowed. Second, Ideal can point to no clear probability of
success on the merits, since its independence from Trainor during
the relevant time period, as well as Ideal's capacity to sue, are
open to serious question. And, third, no "exceptional circum-
stances" are suggested. See Banco Popular de Puerto Rico v.

Greenblatt, 964 F.2d 1227, 1231-34 (1st Cir. 1992) (setting forth

factors to be considered in determining timeliness of interven-
tion). Thus, the district court properly denied the motion to
amend and Ideal lacked standing to appeal.

10As already noted, see supra pp. 12-13, note 9, Ideal lacks

standing to appeal either judgment. Fisher argues that he should
have been given prior notice and an opportunity to challenge the
dismissal. Although we agree that the better practice is to give
notice to all "cross-appellants" prior to any voluntary dismiss-
al, unless the cross-appellant has joined in an agreement that
includes the payment of costs, see Fed. R. App. P. 42(b), in

these circumstances neither Fisher nor Ideal was prejudiced by
the failure to provide separate notice to Fisher. See supra note

4 and infra pp. 14-18.

11We note, moreover, that Fisher's ambiguous response to the
CFI motion in the district court implicates a separate issue. A
party may have standing to appeal, yet lose because he has waived
or forfeited the arguments sought to be raised on appeal. Cf.

Dopp v. HTP Corp., 947 F.2d 506, 512 (1st Cir. 1991) (holding

that a defendant who was dismissed from the case for lack of

personal jurisdiction had no standing to appeal judgments entered

15

ing to appeal turns on his status before the district court at

the time the challenged judgment was entered, and the extent to

which he is "aggrieved" by the judgment. See I.C.C. v. Holmes

Transp. Inc., 983 F.2d 1122, 1125 n.4 (1st Cir. 1993); Little Joe

Trawlers, Inc., 780 F.2d at 161; 9 Moore's Federal Practice

203.06. Fisher was a party of record at the time the first

judgment was entered. Arguably, at least, he was "aggrieved" by

the judgment since it entitled CFI alone to a constructive trust

over the Trainor claims against Biopure relief which Fisher

had sought for himself in his counterclaim against Trainor.

Thus, we conclude that Fisher has standing to appeal the first

judgment and, for present purposes, we assume arguendo that the

appeal is not time-barred.12

A motion for voluntary dismissal of an appeal should be

denied only "in the interest of justice or fairness." American

after it voluntarily absented itself from the proceedings).

12The parties have assumed that the appeal period ran from
the November 22 decision denying his Rule 59(e) motion, hence
that the January 3 notice of appeal was late. They disagree as
to whether the timeliness of a cross-appeal is jurisdictional,
and, if not jurisdictional, as to the effect of the denial of
appellants' motion to enlarge the time to file a cross-appeal.
However, the "separate document" rule does apply to orders

denying Rule 59(e) motions. The lengthy November 22 district
court opinion contained numerous orders, such that, arguably at
least, the Fisher appeal period ran from the December 6 entry of
judgment against him in a separate document. See Fiore v.

Washington County Community Mental Health Ctr., 960 F.2d 229, 235

n.9 (1st Cir. 1992) (en banc); see also RR Village Ass'n, Inc. v.

Denver Sewer Corp., 826 F.2d 1197, 1201 (2d Cir. 1987) (words "so

ordered" at end of a 14-page opinion denying Rule 59(e) motion do
not satisfy "separate document" requirement). Since we conclude
that Fisher failed to prosecute his "cross-appeal," we need not
dwell on these other matters.

16

Auto. Mfrs. Ass'n v. Commissioner, Massachusetts DEP, 31 F.3d 18,

22 (1st Cir. 1994). We discern no legitimate basis for disallow-

ing the motion to withdraw the Trainor appeal.

Withdrawal of the Trainor appeal does not terminate the

Fisher appeal from the same judgment, nor in any way impede

Fisher's ability to protect his own interests before this court.

It became clear at oral argument that Fisher's misapprehension in

this regard was driven by an erroneous assumption on the part of

counsel that the "cross-appeal" bore the same docket number as

the Trainor appeal. But the docket sheets, as well as the

appellate rules, see Fed. R. App. P. 12(a) (requiring clerk to

docket each notice of appeal when received); see also First

Circuit Internal Operating Procedures VI.A.2 (1992) ("in the case

of cross-appeals, the appeals are treated as two separate appeals

for briefing purposes"), indicate otherwise.13 It appears that

this misconception also contributed to Fisher's decision to offer

for filing, together with Ideal, a late so-called "cross-appeal"

brief challenging the first judgment, and to affix to this late

filing the docket number assigned to Trainor's previously dis-

missed appeal. Had Fisher consulted the docket sheets and

13The parties did not notify the Clerk that they wished to
proceed under Fed. R. App. P. 28(h). See First Circuit Internal

Operating Procedure VI.A.2. The docket sheets identify Fisher as
the "appellant and cross-claimant" in appeal no. 95-1092 -- the
number assigned to his "notice of appeal and cross-appeal."
(Ideal is identified the same way in appeal no. 95-1091). The
Trainor docket sheet cross-references Fisher's and Ideal's appeal
numbers, respectively labeling the Fisher appeal as a "cross-
appeal" and the Ideal appeal as a "companion case." The rules do
not allow a party simply to assume as his own a docket number
previously assigned to an appeal taken by another party.

17

complied with the briefing schedule issued by the Clerk, he could

have offered a complete initial brief some three weeks earlier

bearing the pending docket number assigned to his singular

"notice of appeal and cross-appeal."

We must decide, therefore, whether Fisher may proceed

with his appellate challenge to the first judgment on the basis

of his untimely and misnumbered "cross-appeal" brief. Although

such mistakes are not jurisdictional under Rule 3(a), see 9

Moore's Federal Practice 203.12 (1995), Fisher did not seek

discretionary relief from his errors and omissions (e.g., by

requesting leave to file a late supplement to the brief timely

filed in number 95-1092). Instead, he filed two opaque motions

claiming that wrongdoing by other parties relating to the volun-

tary dismissal of the Trainor appeal had hampered his prosecution

of the cross-appeal. Appellees spent time responding to those

motions and court time was devoted to considering them. As a

further consequence, there was no occasion to issue a revised

briefing schedule, and appellees have had no occasion to file

briefs in response. At this stage, therefore, it would be unfair

to foster further delay and expense by countenancing these

practices at the expense of innocent appellees.

Accordingly, we decline to relieve Fisher of these

errors and omissions, and we direct that his so-called cross-

appeal brief be stricken from the record. Cf. United States v.

Hanks, 24 F.3d 1235, 1238-39 (10th Cir. 1994) (declining to

relieve appellant of nonjurisdictional delay in perfecting an

18

appeal where appellant corrected the irregularity but caused

additional prejudice and unnecessary consumption of court re-

sources by failing to give notice of the correction). As Fisher

failed to take proper steps to pursue his challenge to the first

judgment, we turn our attention to the final question: the

appealability of the second Rule 54(b) judgment entered below.

The Fisher Appeal from the Second Judgment: Rule 54(b)
The Fisher Appeal from the Second Judgment: Rule 54(b)

Certification
Certification

Rule 54(b) permits entry of a final judgment as to

fewer than all claims or parties upon an express determination

that there is "no just reason for delay" in entering judgment.

Maldonado-Denis v. Castillo-Rodriguez, 23 F.3d 576, 579 (1st Cir.

1994). Although no party has challenged these Rule 54(b) certif-

ications, we are "duty bound to take the matter up sua sponte,"

since "it implicates the scope of our appellate jurisdiction."

Spiegel v. Trustees of Tufts College, 843 F.2d 38, 43 (1st Cir.

1988). The required jurisdictional analysis comprises two steps.

First, we inquire whether the trial court action

underlying the judgment disposed of all the rights and liabili-

ties of at least one party as to at least one claim. See Cur-

tiss-Wright Corp. v. General Elec. Co., 446 U.S. 1, 7 (1980); 10

Charles A. Wright et al., Federal Practice and Procedure: Civil

2d 2656 n.9, 2657 n.17 (2d Ed. 1983 & Supp. 1995) (citing

cases); 6 Moore's Federal Practice 54.34[2-2] n. 4 (citing

cases); cf. Maldonado-Denis, 23 F.3d at 580 (the ruling should

dispose "completely either of all claims against a given defen-

19

dant or of some discrete substantive claim or set of claims

against the defendants generally"). The first requirement was

met here with respect to the summary judgments entered against

Fisher and in favor of Biopure and CFI. Although CFI's deriva-

tive rights against Biopure remain unresolved, as to Fisher

nothing remained but to enter judgment.

Second, we must examine the sufficiency of the district

court's assessments of (1) any interrelationship or overlap among

the various legal and factual issues involved in the dismissed

and the pending claims, and (2) any equities and efficiencies

implicated by the requested piecemeal review.

In its critical role as a Rule 54(b) "dis-
patcher" . . . the district court is to con-
sider the strong judicial policy disfavoring

piecemeal appellate review . . . by carefully

comparing the dismissed and the unadjudicated
claims for indications of substantial overlap
-- to ensure that the appellate court is not
confronted in successive appeals with common
issues of law or fact to the detriment of
judicial efficiency.

Kersey v. Dennison Mfg. Co., 3 F.3d 482, 487 (1st Cir. 1993)

(citations omitted) (emphasis added). When the district court

provides a sufficient written statement of the grounds for

certification, as it should, "we normally accord its discretion-

ary decision `substantial deference' and will dismiss for lack of
` '

appellate jurisdiction only if the court's certification was

`clearly unreasonable.'" Id. at 486 (citation omitted); see also
` '

Curtiss-Wright, 446 U.S. at 10 ("The court of appeals must of

course, scrutinize the district court's evaluation of such

factors as the interrelationship of the claims . . . But once

20

such juridical concerns have been met, the discretionary judgment
,

of the district court should be given substantial deference.")

Although it is clear from the Rule 54(b) certification

that the district court anticipated that an immediate appeal

might avoid a trial, this ground "is rarely, if ever, a self-

sufficient basis for a Rule 54(b) certification." Kersey, 3 F.3d

at 488; see also Spiegel, 843 F.2d at 43 n.4 (cautioning that "a

concise list of reasons will likely be needed" to facilitate

appellate understanding of the certification decision). The

district court certification contained no evaluation of the

interdependence of dismissed and pending claims, no identifica-

tion or analysis of the remaining claims, and no reference to

"compelling evidence that the equities favor early appellate

review." Id. Consequently, we have culled the entire record on

appeal for any "compelling considerations favoring the entry of

an earlier than usual judgment," such as might warrant a piece-

meal appellate review notwithstanding the absence of specific

findings. Feinstein v. Resolution Trust Corp., 942 F.2d 34, 40

(1st Cir. 1991) (quoting Spiegel, 843 F.2d at 43 n.4); see also

Scarfo v. Cabletron Sys., Inc., 54 F.3d 931, 936 (1st Cir. 1995)

(nothing is gained by remanding a case for entry of a properly-

crafted judgment where in due course the same issues will be

returned to the appellate court).

At the time the appeal was taken from the judgment

against Fisher, the only appropriate consideration apparently

favoring Rule 54(b) certification was the possibility that it (in

21

combination with the earlier judgment against Trainor) might prod

the parties to settle their differences, particularly in light of

the fact that the district court rulings effectively substituted

CFI as the sole plaintiff with respect to the purported joint

venturers' claims against Biopure.

Still in the case, however, were all the same claims,

with CFI as a derivative plaintiff on some. Moreover, all

parties remained in the case in connection with other claims.

"Rule 54(b) certification is particularly suspect when the

contestants on appeal remain, simultaneously, contestants below."

Kersey, 3 F.3d at 487 (citations omitted); cf. Feinstein, 942

F.2d at 40 (upholding a district court certification which lacked

specific findings, but where the judgment had disposed of all

claims against all six appellees).

Settlements during the pendency of the present appeal

did winnow out some claims. Trainor settled with CFI and Bio-

pure. Appellees suggest that there will be a further reduction

in the number of pending claims should we affirm the district

court judgment. CFI and Biopure represent that they have condi-

tionally settled CFI's derivative claims between themselves. At

oral argument, all parties indicated that they would likely forgo

their remaining claims were the court to affirm the judgment

against Fisher. These prospects nonetheless do not affect the

required threshold jurisdictional analysis: "To entertain an

early appeal just because . . . a [particular] ruling . . . might

transpire and might expedite a particular [party's] case would

22

defoliate Rule 54(b)'s protective copse." Spiegel, 843 F.2d at

46.

As we scan the present landscape, the following claims

remain pending before the district court. In Fisher v. Trainor,

all Fisher claims against Trainor remain pending.14 In Trainor

v. Biopure, the following remain pending: (1) Biopure's third-

party claims against Fisher, (2) the Fisher counterclaim against

Trainor,15 and (3) CFI's derivative and direct claims against

Biopure. Thus, all claims against Fisher remain in the case, and

all parties as well.

There is a substantial interdependence and overlap

between pending and dismissed claims. In Trainor v. Biopure, the

pending CFI derivative claims against Biopure are entirely

dependent on the validity and value of the constructive trust

over the Fisher claims. In addition, there is a problematic

factual overlap as between the pending Biopure claims against

Fisher (for violations of RICO, Mass. Gen. L. ch. 93A, securities

fraud, common law fraud and declaratory judgment) and the con-

structive trust, declaratory judgment and unjust enrichment

claims resolved favorably to CFI.

14Although we consider each of the consolidated actions
separately in order to expedite our analysis, we note as well
that there are obvious overlaps among the dismissed and the
pending claims, which cut across these consolidated actions. Cf.

FDIC v. Caledonia Inv. Corp., 862 F.2d 378, 381 (1st Cir. 1988).

15Apparently, no judgment has been entered on this counter-
claim, although the district court denied Fisher's motion to
expand and amend it, and the logic of the two judgments in favor
of CFI may moot it. An earlier motion by Trainor to dismiss the
counterclaim also appears to remain pending.

23

Biopure alleges that Fisher, as well as Trainor,

defrauded CFI in connection with the CFI loan transaction; that

Fisher misrepresented or failed to disclose that the funds he and

Trainor invested in Biopure had been fraudulently obtained from

CFI; and that their investment in Biopure was but one in a series

of fraudulent transactions jointly undertaken by Trainor and

Fisher. Similarly, although CFI charged Trainor alone with

actual fraud, it alleged that Fisher "knew or should have known"

that the funds invested in Biopure had been fraudulently obtained

from CFI, without consideration.

The overlapping issues the scope of the fraud on

CFI, and Fisher's knowledge, role, and legal responsibility for

it, if any "bid fair to form an essential focus of successive

appeals." Kersey, 3 F.3d at 487. CFI and Biopure prevailed below

by proffering factual concessions solely for purposes of their

summary judgment motions. Their concessions which have varied

somewhat on appeal raise ambiguous inferences and actually

conflict in important respects. CFI offers to stipulate that

Fisher had no actual knowledge of the tainted source of the

funds, and that Trainor's fraud on CFI was independent of, and

committed prior to, the formation of the joint venture. Biopure

tenders similar factual concessions based on fragments from

Fisher's pleadings, but does not assume that Trainor's prior

fraud was independent of the joint venture. Both parties offer

to stipulate that Trainor may have defrauded Fisher as well.

CFI argues that under Massachusetts partnership law,

24

Mass. Gen. L. ch. 108A, 12, and equitable restitutionary

principles, it is entitled to a constructive trust over Fisher's

claims without regard to Fisher's state of mind, because Trai-

nor's independently-acquired guilty knowledge is to be "imputed"

automatically to the Trainor-Fisher joint venture. On the other

hand, Biopure apparently assumes that the joint venture must be

"liable" for Trainor's fraud, or if not the fraud, then the

"fraudulent investment." See Mass. Gen. L. ch. 108A, 13.

Their theories are problematic.

The determinative equity-based principles at work here

are highly fact-sensitive.16 See Restatement (Second) of Agen-

cy 274 cmts. b & c, 282 cmts. h & i (1958); Restatement of

Restitution 172-74, 202, 203, 208(3), 210-213, 215 (1937); 1

Alan R. Bromberg & Larry E. Ribstein, Bromberg & Ribstein on

Partnership 4.06 & nn. 13-16, 4.07 & nn. 23, 27-30 (1991 &

Supp. 1994); see also Loring v. Baker, 329 Mass. 63, 65, 106

N.E.2d 434, 436-37 (1952); New England Trust Co. v. Farr, 57 F.2d

16The district court made no express choice-of-law determi-
nation, but assumed, as do the parties, that Massachusetts law
governs the partnership issues (the Trainor-Fisher joint venture
allegedly was formed in Massachusetts). We are less clear as to
what law the court utilized in determining the remedy available
to CFI for the fraudulent loan transaction. Appellees rely
primarily on federal cases which apply the law of states other
than the forum. See Federal Deposit Ins. Corp. v. Braemoor

Assocs., 686 F.2d 550 (7th Cir. 1982) (Illinois law), cert.

denied, 461 U.S. 927 (1983); Higgins v. Shenango Pottery Co., 256

F.2d 504 and 279 F.2d 46 (3d Cir.) (Pennsylvania law), cert.

denied, 364 U.S. 899 (1960). As we need not resolve the choice-

of-law question, we intimate no opinion. We note only that the
cited rulings likewise were highly fact-dependent, and are of
little assistance given the ambiguities and conflicts in the
hypothesized facts presented in the instant case.

25

103, 111 (1st Cir.) (applying Massachusetts partnership law),

cert. denied, 287 U.S. 612 (1932).

The crux of the Rule 54(b) certification problem in the

present context is that any substantive ruling based on the

present record would require that we determine the hypothetical

reach of the governing partnership law and restitutionary princi-

ples. The materiality of the conflicting stipulations would have

to be addressed and their limitations and ambiguities resolved.

Meanwhile, Fisher's knowledge of the fraud and the scope of the

Trainor-Fisher joint venture would remain crucial, unresolved

considerations underlying the Biopure claims. Subsequent dis-

trict court proceedings could very well render superfluous

whatever interim appellate resolution might be predicated on this

fragile hypothetical foundation, and another panel could be

required to revisit the central question of Fisher's knowledge

and participation in the alleged scam. Such piecemeal appellate

exercises sacrifice judicial efficiency and risk serious, unin-

tended res judicata effects. See Kersey, 3 F.3d at 487 (citing

cases abjuring such risks).

On the face of the pleadings in Fisher v. Trainor

alone, there appears "so substantial a prospect of contextual

overlap" between Fisher's dismissed claims (against Biopure) and

his unadjudicated claims (against Trainor), as to "counsel[]

strongly against Rule 54(b) certification." Id. The crux of the

Fisher claims against both Trainor and Biopure for unjust enrich-

ment (Count Five), and against Biopure for promissory estoppel

26

(Count Eight), is that Fisher contributed substantial time and

expertise ("sweat equity") to the venture, resulting in a sub-

stantial increase in the value of the Biopure stock and product

licensing rights. In addition, the Fisher "breach of contract"

claim against Biopure, and the "interference with contract" claim

against Trainor, rest on identical factual allegations, viz., the

"switch" in contracting parties. See supra p. 6.

These overlapping issues were not focused upon in the

district court opinion granting summary judgment to Biopure (and

a constructive trust to CFI). The court presumably was able to

disregard the overlaps largely because Fisher failed to oppose

the motions for summary judgment on the ground that he had a

right to recover for his "sweat equity" contributions. Thus, the

success of the motions for summary judgment depended upon an

assumption that Fisher's only investment in Biopure consisted of

funds fraudulently obtained from CFI. Notwithstanding the fact

that Fisher's "sweat equity" was a focus of his complaint and

that there was competent testimonial evidence of his efforts,17

he did not counter with the claim that he (or the joint venture)

had contributed untainted value which enhanced the worth of the

Biopure stock and licensing rights. Instead, he argued simply

17Of course, it was for Fisher to generate a material issue
of fact that might enable him, and not merely CFI, to recover
from Biopure for unjust enrichment and promissory estoppel.
Fisher adverted to his "sweat equity" only as "consideration" for
a loan which Trainor allegedly promised Fisher. See accompanying

text. Passing mention of facts from which a theory might later
be carved does not place an undeveloped argument in issue.
United States v. Slade, 980 F.2d 27, 30 (1st Cir. 1992).

27

that he was a bona fide purchaser of the loan funds fraudulently

obtained from CFI by Trainor, on the theory that Trainor had made

a false promise to lend the CFI monies to Fisher.

By offering his "sweat equity" theory of recovery for

the first time at oral argument on appeal, Fisher essentially

urged that we relieve him of his district court waiver.18 But

the Rule 54(b) safeguards against inefficient piecemeal review

would be severely undermined were we to attempt to speculate at

this juncture as to the labrynthine consequences of Fisher's

failure to assert this theory before the district court in the

first instance. Moreover, an argument "surfacing for the first

time on appeal" may be excepted from the raise-or-waive rule only

if it is "so compelling as virtually to insure appellant's

success, and a gross miscarriage of justice would result from

[the] failure to address it." American Auto. Mfrs. Ass'n, 31

F.3d at 26; see also Johnston v. Holiday Inns, Inc., 595 F.2d

890, 893 (1st Cir. 1979) (waiver rule is relaxed only in "horren-

dous cases" where a gross miscarriage would occur).

A fortiori, we think it clear that the waiver rule

should be rigorously applied to interlocutory appeals certified

pursuant to Rule 54(b). The strength of the forfeited Fisher

18Fisher made reference to this theory in an "introductory"
comment to his reply brief as well. Arguments omitted from an
opening brief on appeal ordinarily are deemed waived. See

Pignons S.A. de Mecanique v. Polaroid Corp., 701 F.2d 1, 3 (1st

Cir. 1983) ("An appellee is entitled to rely on the content of an
appellant's brief for the scope of the issues appealed, and
appellant generally may not preserve a claim merely by referring
to it in a reply brief or at oral argument.").

28

theory can be assessed only by focusing on the core factual

allegations underlying both the dismissed and the pending claims,

as well as the closely intertwined legal issues governing any

remedy. See and compare, e.g., Meehan v. Shaughnessy, 404 Mass.

419, 445-46, 535 N.E.2d 1255, 1270 (1989) (award of constructive

trust based on usurped partnership opportunities may entail a

proportionate assessment of profits generated by each partner's

efforts); Provencher v. Berman, 699 F.2d 568, 572 (1st Cir. 1983)

(allowing non-partner wrongdoers to retain proportionate share of

property held in constructive trust for another where wrongdoers

had contributed value to the property in the form of untainted

personal labor).

The "gross miscarriage of justice" test likewise

requires consideration of interrelated factual and legal theo-

ries. Typically, a miscarriage of justice may be shown where a

litigant would suffer grave personal harm, such as a loss of

liberty or domicile, see American Auto. Mfrs. Ass'n, 31 F.3d at

26 (citations), or where the issue involves sensitive matters of

federalism or the public interest. See Capitol Indem. Corp. v.

Keller, 717 F.2d 324, 328-29 (7th Cir. 1983). A "gross miscar-

riage of justice" also may be found, however, if the forfeited

claim would "seriously effect[] [sic] the fairness, integrity or

public reputation of a proceeding." Desjardins v. Van Buren

Community Hosp., 969 F.2d 1280, 1282 (1st Cir. 1992).19

19New arguments may be entertained on appeal in "exceptional
circumstances" where no prejudice would result either to other
parties or to the administration of justice. United States v.

29

Any showing that a "miscarriage of justice" might

obtain in the present context ultimately would depend on whether

the constructive trust awarded CFI constituted an unwarranted

"windfall," grossly disproportionate to any losses. However, the

injustice in any such "windfall" is inextricably bound to the

remedial principles utilized to resolve the dismissed claims and

the pending claims. See, e.g., Provencher, 699 F.2d at 570-72

(applying restitutionary principles where more than one claimant

contributed to value of property claimed under constructive

trust); Janigan v. Taylor, 344 F.2d 781, 787 (1st Cir.) (explain-

ing restitutionary principles applicable to "constructive trust"

remedy), cert. denied, 382 U.S. 879 (1965); see generally 1

George E. Palmer, Law of Restitution 2.14 (1978 & Supp. 1995);

Austin W. Scott & William F. Fratcher, Scott on Trusts 508 (4th

ed. 1989 & Supp. 1994); Dale A. Oesterle, Deficiencies of the

Restitutionary Right to Trace Misappropriated Property in Equity

and in UCC 9-306, 68 Cornell L. Rev. 172 (1983). Moreover,

crucial, unresolved facts including the value of the claims

over which CFI has been awarded a constructive trust,20 and the

Rivera, 55 F.3d 703, 708 (1st Cir. 1995); cf. City of Newport v.

Fact Concerts, 453 U.S. 247, 255 (1981) (holding that a forfeited

claim may be considered on appeal where the trial court addressed
the merits of a belated objection, and the appellate court does
not disagree with the substance of the trial court ruling).

20Fisher asserted at oral argument that these claims were
worth at least $179 million, an estimate apparently based on the
Biopure/Upjohn contract. Biopure stated that no proof was
presented below as to the value of the claims. Fisher's supple-
mentary appendix includes an unindexed copy of the contract, but
there is no indication that it was before the district court at
summary judgment, and we have seen no record findings as to

30

value of Fisher's belatedly asserted untainted contributions

remain central to the disputed claims still pending before the

district court. Thus, the insufficiently developed trial court

record precludes any reliable determination as to whether a

miscarriage of justice would obtain were the waiver rule to be

applied to the Fisher v. Trainor action.

value.

31

III
III

CONCLUSION
CONCLUSION

Accordingly,

(1) As the second Rule 54(b) certification was improv-

idently granted, we lack appellate jurisdiction of the Fisher

appeal in No. 95-1092, which is hereby dismissed without preju-

dice;

(2) the Ideal appeal in No. 95-1091 is dismissed for

lack of appellate jurisdiction and lack of standing;

(3) the motion to vacate the voluntary dismissal of

the Trainor appeal in No. 94-1854 is denied, and the so-called

"cross-appeal brief" filed by Fisher and Ideal in No. 94-1854 is

hereby stricken;

(4) the case is remanded to the district court for

further proceedings consistent with this opinion; and

(5) double costs are awarded to CFI and Biopure. See

Fed. R. App. P. 38.

SO ORDERED.
SO ORDERED.

32