Case: 17-30450 Document: 00514306259 Page: 1 Date Filed: 01/12/2018
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 17-30450
Summary Calendar
United States Court of Appeals
Fifth Circuit
FILED
January 12, 2018
In the Matter of: R. Alan Kite,
Lyle W. Cayce
Clerk
Debtor.
KENNETH MICHAEL WRIGHT, L.L.C.,
Appellant,
v.
KITE BROS., L.L.C.; ROBERT KITE,
Appellees.
Appeal from the United States District Court
for the Western District of Louisiana
No. 2:16-CV-1713
Before REAVLEY, PRADO, and GRAVES, Circuit Judges.
PER CURIAM: *
On April 5, 2017, the U.S. District Court for the Western District of Loui-
siana entered an order granting Appellees Kite Bros., L.L.C., and Robert Kite’s
Motion to Dismiss Untimely Bankruptcy Appeal; for Frivolous Appeal Damages;
and to Recover Costs, Expenses, and Attorney Fees, concluding that Appellant
*Pursuant to 5th Cir. R. 47.5, the court has determined that this opinion should not be
published and is not precedent except under the limited circumstances set forth in 5th Cir. R.
47.5.4.
Case: 17-30450 Document: 00514306259 Page: 2 Date Filed: 01/12/2018
No. 17-30450
Kenneth Michael Wright, L.L.C., was deserving of sanctions under Federal
Rules of Bankruptcy Procedure 9011 and 8020(a) for filing a frivolous appeal
of a final judgment of the Bankruptcy Court. A month later, the district court
entered an order awarding Appellees attorney’s fees in the amount of $21,571.50.
Appellant appeals from that order.
Separately, Appellees file a Motion for Sanctions in this court under Rule
38 of the Federal Rules of Appellate Procedure, against both Appellant and its
counsel, Kenneth Michael Wright, on the ground that the issues raised by the
instant appeal are similarly frivolous. For the reasons that follow, we affirm the
judgment of the district court and grant Appellees’ motion for sanctions in part.
I
Given the parties’ familiarity with the underlying facts of this case, we
recite only those that are necessary to deciding this appeal. In February 2014,
Appellees timely filed a $1 million–plus proof of claim in the bankruptcy pro-
ceedings of Debtor R. Alan Kite, now deceased, based on a December 2013 Lou-
isiana state court judgment. In September 2016, Appellant, in its capacity as
an unsecured creditor of the Debtor, objected to Appellees’ proof of claim and
collaterally attacked the state court judgment by asserting a removal argument
that had previously been rejected by both the state court and a federal district
court. At a hearing held on November 17, 2016, the bankruptcy court denied
Appellant’s objection to the proof of claim under the Rooker–Feldman doc-
trine. 1 The court entered a written order on the docket eleven days later,
November 28th, memorializing the denial of Appellant’s objection. Per
Federal Rule of Bankruptcy Procedure 8002(a)(1), Appellant had fourteen
1This doctrine, named for Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923), and District
of Columbia Court of Appeals v. Feldman, 460 U.S. 462 (1983), bars federal claims raised in
state court and claims “inextricably intertwined” with a state court’s prior judgment. See
Feldman, 460 U.S. at 486–87.
2
Case: 17-30450 Document: 00514306259 Page: 3 Date Filed: 01/12/2018
No. 17-30450
days from the November 28th entry of judgment to file a notice of appeal, i.e.,
until December 12, 2016. But Appellant did not file its notice of appeal until
one day after the deadline, i.e., December 13th.
Appellees moved in the district court to dismiss the appeal as untimely
under Rule 8002(a)(1), citing our decision in Smith v. Gartley (In re Berman-
Smith), 737 F.3d 997 (5th Cir. 2013), in which we held unequivocally that
[s]ince the statute defining jurisdiction over bankruptcy appeals, 28
U.S.C. § 158, expressly requires that the notice of appeal be filed
under the time limit in Rule 8002, . . . the time limit is jurisdictional.
Accordingly, . . . the failure to file a timely notice of appeal in the
district court leaves the district court, and this court, without juris-
diction to hear the appeal.
Id. at 1003. Appellees also sought sanctions against Appellant under Fed. R.
Bankr. P. 8020(a) and 9011, 28 U.S.C. § 1927, and the court’s inherent authority
on the ground that Appellant’s appeal was untimely and frivolous. Appellant
raised only two arguments in response: Rule 8002 is not jurisdictional, and the
removal argument was not frivolous because it had been litigated before several
Louisiana circuit court panels. Appellant challenged In re Berman-Smith by
arguing that “[i]t clearly appears that the Fifth Circuit has not followed the
Supreme Court analysis and the argument that the Court lacks jurisdiction is
not valid because the Bankruptcy Rules are not Congressional Acts.” Appellant
raised no procedural, safe-harbor objections and it did not object to Appellees’
evidence supporting the imposition of sanctions.
The district court granted Appellees’ motions. It rejected Appellant’s claim
that In re Berman-Smith had not followed Supreme Court jurisprudence: “The
Fifth Circuit, and every other circuit court that has addressed whether Bank-
ruptcy Rule 8002’s deadline is jurisdictional, determined that the deadline is
jurisdictional and based on a statute . . . .” The court concluded that it lacked
jurisdiction to hear the appeal because the appeal was untimely, given that
Appellant filed its notice of appeal one day after the deadline. The district court
3
Case: 17-30450 Document: 00514306259 Page: 4 Date Filed: 01/12/2018
No. 17-30450
then imposed sanctions under Rules 9011 and 8020(a) based on Appellant’s
“frivolous appeal that rehashe[d] an argument that has already been considered
and denied by the district court and the Louisiana court system.” The court en-
tered a judgment awarding Appellees “reasonable costs and attorney fees for the
defense of the appeal” and giving Appellees until April 17, 2017, to submit a fee
application. Appellees timely filed their application, but Appellant missed its
response deadline by more than a week before filing an out-of-time motion for
extension of time. The district court denied the motion, citing Appellant’s “bla-
tant disregard of the court’s order.” On May 4th, the district court found Appel-
lees’ fee application for $21,571.50 to be reasonable and imposed the award,
explaining that “[t]here is no doubt that the motion to dismiss and motion for
sanctions involved complex issues as well as having to deal with the convoluted
relevant findings.”
Appellant timely appealed the order awarding sanctions. We have juris-
diction to consider the appeal under 28 U.S.C. § 158(d).
II
Appellant raises three issues on appeal: (1) the district court did not follow
the procedural prerequisites to imposing sanctions under Rule 9011; (2) the
sanction imposed was not the least restrictive means available to deter the
wrongful conduct; and (3) the appeal to the district court was not frivolous be-
cause Rule 8002 is not jurisdictional. It cannot be disputed that Appellant raised
neither the first nor second issue before the district court, so we decline to ad-
dress them, “keeping with our precedent that arguments not raised before the
district court are waived and cannot be raised for the first time on appeal.” Freeh
v. Lake Eugenie Land & Dev., Inc. (In re Deepwater Horizon), 857 F.3d 246, 251
(5th Cir. 2017) (quoting LeMaire v. La. Dep’t of Transp. & Dev., 480 F.3d 383,
387 (5th Cir. 2007)).
Turning then to the third issue, an appeal is frivolous “‘if the result is
4
Case: 17-30450 Document: 00514306259 Page: 5 Date Filed: 01/12/2018
No. 17-30450
obvious or the arguments of error are wholly without merit’ and the appeal is
taken ‘in the face of clear, unambiguous, dispositive holdings of this and other
appellate courts.’” Streamline Prod. Sys., Inc. v. Streamline Mfg., Inc., 851 F.3d
440, 463 n.12 (5th Cir. 2017) (quoting Coghlan v. Starkey, 852 F.2d 806, 811–12
(5th Cir. 1988) (per curiam)); see also Reynolds v. Boyle, 679 F. App’x 372, 373
(5th Cir. 2017) (per curiam) (“An appeal is frivolous if it ‘lacks an arguable basis
in law or fact.’” (quoting Taylor v. Johnson, 257 F.3d 470, 472 (5th Cir. 2001))).
As explained above, we held in In re Berman-Smith that the fourteen-day
deadline for filing a notice of appeal provided in Fed. R. Bankr. P. 8002(a) is
jurisdictional. 737 F.3d at 1003. Appellant filed its notice of appeal on the fif-
teenth day following the district court’s sanctions order. Thus, the appeal is un-
timely and, under these circumstances, frivolous.
Appellant’s argument that In re Berman-Smith is somehow in conflict with
Supreme Court precedent regarding jurisdictional timeliness rules because
“Rule 8002 is not statutorily based” is meritless. In In re Berman-Smith, we
read the Supreme Court’s decisions in Kontrick v. Ryan, 540 U.S. 443 (2004), and
Bowles v. Russell, 551 U.S. 205 (2007), to stand for the proposition that while,
in general, time limits outlined by procedural rules are not jurisdictional, if a
time limit “is mandated by Congress, that time limit is jurisdictional and may
be considered at any time as a bar to review.” In re Berman-Smith, 737 F.3d at
1001. And we reasoned that because jurisdiction is determined by 28 U.S.C.
§ 158(c)(2)’s incorporation of the time limits prescribed in Rule 8002(a), 2 Rule
8002(a) is jurisdictional because it is based in statute. Id. at 1002–03. Appel-
lant either ignores or misreads In re Berman-Smith to raise an argument that
2The statute provides: “An appeal under subsections (a) and (b) of this section shall
be taken in the same manner as appeals in civil proceedings generally are taken to the courts
of appeals from the district courts and in the time provided by Rule 8002 of the Bank-
ruptcy Rules.” 28 U.S.C. § 158(c)(2) (emphasis added).
5
Case: 17-30450 Document: 00514306259 Page: 6 Date Filed: 01/12/2018
No. 17-30450
itself is grounded in a clear misinterpretation of both Kontrick and Bowles.
Our court is not an outlier on this issue. Every other court of appeals to
consider Rule 8002(a) post–Kontrick and Bowles has stated that the rule is ju-
risdictional. See Schwab Indus., Inc. v. Huntington Nat’l Bank, 679 F. App’x 397,
399 (6th Cir. 2017); Ozenne v. Chase Manhattan Bank (In re Ozenne), 841 F.3d
810, 814 (9th Cir. 2016), cert. denied, 137 S. Ct. 1589 (2017); Gowdy v. Mitchell
(In re Ocean Warrior, Inc.), 835 F.3d 1310, 1318–19 (11th Cir. 2016); In re
Sobczak-Slomczewski, 826 F.3d 429, 431–32 (7th Cir. 2016), cert. denied, 137 S.
Ct. 1119 (2017); Hamid v. Deutsche Bank Nat’l Trust Co. (In re Hamid), 577 F.
App’x 208, 208 (4th Cir. 2014) (per curiam); Statek Corp. v. Dev. Specialists, Inc.
(In re Coudert Bros. LLP), 673 F.3d 180, 185–86 (2d Cir. 2012); Vázquez Laboy
v. Doral Mortg. Corp. (In re Vázquez Laboy), 647 F.3d 367, 371 (1st Cir. 2011);
In re Caterbone, 640 F.3d 108, 112–13 (3d Cir. 2011); Emann v. Latture (In re
Latture), 605 F.3d 830, 837 (10th Cir. 2010). Not a single court of appeals has
held otherwise. Indeed, we just recently acknowledged the continued force of In
re Berman-Smith’s holding. See Dorsey v. U.S. Dep’t of Educ., 870 F.3d 359, 362
(5th Cir. 2017) (“The failure to file a timely notice of appeal in a bankruptcy case
deprives both the district court and this court of jurisdiction.”).
It is therefore without question that the result of Appellant’s appeal was
obvious and that the appeal was taken “in the face of clear, unambiguous, dis-
positive holdings of this and other appellate courts.” Streamline Prod. Sys., Inc.,
851 F.3d at 463 n.12 (citation and internal quotation marks omitted). We agree
with the district court’s ruling that sanctions were warranted because Appel-
lant’s appeal was frivolous, and we AFFIRM the district court’s order imposing
those sanctions. 3
3Although the district court’s order was based on two separate holdings that the appeal
was frivolous and that it was untimely, not that the appeal was frivolous because it was
6
Case: 17-30450 Document: 00514306259 Page: 7 Date Filed: 01/12/2018
No. 17-30450
III
A
We address now Appellees’ motion for sanctions in this court. Rule 38
of the Federal Rules of Appellate Procedure provides that “[i]f a court of appeals
determines that an appeal is frivolous, it may, after a separately filed motion or
notice from the court and reasonable opportunity to respond, award just dam-
ages and single or double costs to the appellee.” Fed. R. App. P. 38. We apply the
same standard to determine the frivolity of this appeal as we used to determine
the frivolity of the appeal to the district court, Marceaux v. Lafayette City-Parish
Consol. Gov’t, 614 F. App’x 705, 710–11 (5th Cir. 2015) (per curiam), i.e., the
appeal is frivolous “if the result is obvious or the arguments of error are wholly
without merit and the appeal is taken in the face of clear, unambiguous, dis-
positive holdings of this and other appellate courts,” Streamline Prod. Sys., Inc.,
851 F.3d at 463 n.12 (citations and internal quotation marks omitted). “[I]t is
not bad faith that establishes frivolity of appeal, but that an unreasonable legal
position is advanced without a good faith belief that it is justified.” Coghlan,
852 F.2d at 814 (citation and internal quotation marks omitted).
On this basis, we determine that Appellant’s appeal of the sanctions order
to this court is frivolous. The result of this appeal was obvious, because (1) Ap-
pellant filed its initial notice of appeal to the district court outside Rule 8002(a)’s
fourteen-day time period, which clearly deprived the district court of jurisdic-
tion to consider that appeal, and (2) the district court, in imposing its sanctions
order, provided fair notice to Appellant of the ample legal authority holding
squarely against it on the timeliness issue. Notwithstanding this notice and the
authority supporting it, Appellant appealed the sanctions order. Appellant gives
untimely, we “may affirm the district court’s judgment on any basis supported by the record.”
United States v. Chacon, 742 F.3d 219, 220 (5th Cir. 2014).
7
Case: 17-30450 Document: 00514306259 Page: 8 Date Filed: 01/12/2018
No. 17-30450
us no indication that it advanced its legal position vis-à-vis the sanctions order
with any good faith belief that it was justified.
Alternatively, an appeal can be considered frivolous when an appellant
gives the court nothing to consider in the appeal. Patel v. Phillips, 540 F. App’x
417, 417 (5th Cir. 2013) (per curiam). Appellant gave us nothing to properly
consider here. We could not consider the two arguments Appellant impermissi-
bly raised for the first time on appeal. The sole argument Appellant raised that
it had previously raised below is the argument that a jurisdictional rule is some-
how not jurisdictional—despite clear rulings of this court and nine other circuit
courts. Obviously, this appeal is frivolous.
B
Having found that the appeal is frivolous, we also find that all procedural
prerequisites to awarding sanctions under Rule 38 have been satisfied. Appel-
lees filed a separate motion, and Appellant responded—though its response ig-
nores completely the jurisdictional rule issue and instead confusingly argues that
this appeal “addresses only the issuance of and the amount of sanctions pursu-
ant to [Bankruptcy Rule] 9011” (again, an argument we cannot consider as it was
not raised below).
Accordingly, we GRANT Appellees’ motion for sanctions against Appellant
and deny the motion for sanctions against Appellant’s counsel individually. We
award nominal damages of $1 and double costs to Appellees.
* * *
The judgment of the district court is AFFIRMED and Appellees’ Motion
for Sanctions is GRANTED IN PART.
8