United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT November 19, 2004
__________________________ Charles R. Fulbruge III
Clerk
No. 03-41333
__________________________
IN THE MATTER OF: KAREN JUNE SCRUGGS;
THOMAS HERBERT SCRUGGS,
Debtors
KAREN JUNE SCRUGGS; THOMAS HERBERT SCRUGGS,
Appellees,
versus
DONNA LOWMAN, as Personal Representative
of the Estate of the late JOHN F. LOWMAN,
Appellant.
___________________________________________________
Appeal from the United States District Court
for the Southern District of Texas
___________________________________________________
Before SMITH, WIENER, and PICKERING, Circuit Judges.
PER CURIAM:*
Appellant Donna Lowman (“Lowman”), on behalf of the Estate of
her late father, John F. Lowman (“Decedent”), filed this appeal
from an August, 2003 order of the district court that reversed an
October, 2002 order of the Bankruptcy Court. The Bankruptcy Court
had granted its order in response to Lowman’s motion for relief
*
Judge Wiener specially concurs and reserves his right to
file a Special Concurrence at a later time.
from the automatic stay that was then in place in the Chapter 13
bankruptcy of both Appellees, namely, (1) Karen June Scruggs
(“Karen”) who had been divorced from Decedent in Florida on March
25, 1994; and (2) Thomas Herbert Scruggs, Karen’s husband before
and after the time in June, 2002 when they filed for Chapter 13
bankruptcy protection (collectively the “Debtors”). We conclude
that the instant appeal of the district court’s order is moot as a
result of events that occurred after October 2, 2002 (the date of
the Bankruptcy Court’s order that lifted the automatic stay for the
limited purpose of allowing “the Florida State Court [property
settlement] enforcement action to proceed to final judgment”), but
before August 7, 2003 (the date of the district court’s order that
reversed the Bankruptcy Court). Furthermore, as we conclude that
this matter became moot before the district court granted the order
appealed to us, mootness vitiates both our appellate jurisdiction
and the district court’s order as well. Thus we not only must
dismiss this appeal but also must vacate the district court’s
order: The Bankruptcy Court’s order lifting the automatic stay was
in full force and effect at all times pertinent to the state court
action in Florida because the judgment in that action was rendered
and became final and no longer appealable after the Bankruptcy
Court lifted the automatic stay and before the district court
purported to reverse the Bankruptcy Court.1
1
As Appellees in Lowman’s appeal to us, the Debtors filed a
motion to dismiss Lowman’s appeal as moot. A different panel of
2
I. FACTS & PROCEEDINGS
The lengthy and contentious litigation between, on the one
hand, Decedent (and now his estate, represented since his death in
1999 by Lowman, his daughter and legal representative), and, on the
other hand, Decedent’s former wife Karen (with her current husband,
one of the Debtors) continues to be fought out in the state courts
of Florida and the Bankruptcy and district courts of the Southern
District of Texas as it has been for more than 10 years. The only
aspects of this litigation before us today, however, are those
affected by (1) the Bankruptcy Court’s October 2002 order in the
Debtors’ Chapter 13 proceedings, lifting the automatic stay at the
behest of Lowman, (2) the Debtors’ October 11, 2002 appeal of that
ruling to the district court, (3) the district court’s August 7,
2003 order reversing the Bankruptcy Court’s order and re-imposing
the automatic stay, (4) Lowman’s September 4, 2003 appeal to us
from that ruling of the district court; and (5) the subsequent
urgings of both Lowman as appellant and the Debtors as appellees
that we dismiss the instant appeal as moot. We therefore recount
briefly only the background chronology of this case needed to put
our disposition of the instant appeal in perspective:
• September, 1993: Decedent and Karen marry
• October, 1993: Decedent retires from 20-year career with
YMCA and elects 100% Joint and Survivor
this court ordered the Debtors’ motion carried with the case.
Our ruling today of necessity disposes of the Debtors’ dismissal
motion.
3
Annuity under the YMCA’s ERISA pension
plan
• November, 1993: Decedent receives first monthly payment
of his participant’s annuity under YMCA
pension plan
• March, 1994: Decedent and Karen separate
• March 25, 1994: Final Florida divorce decree filed,
incorporating property settlement
• October 25, 1999 (the day before Decedent’s death):
Motion filed in Decedent’s name in
circuit court for Monroe County, Florida
seeking enforcement of Karen’s divorce
settlement agreement waiving any interest
in Decedent’s pension
• October 26, 1999: Decedent dies in Michigan from “head and
throat cancer” “months” after onset (per
his Certificate of Death); his lifetime
“joint” annuity ceases automatically
• November 1, 1999: Pursuant to Decedent’s 1993 election of
“Joint and Survivor” annuity, Karen’s
survivor annuity commences and she
receives her first monthly payment from
that feature of the pension elected by
Decedent under the YMCA retirement plan
• October 13, 2000: Lowman, as Decedent’s estate represen-
tative, substituted as plaintiff in
Florida property settlement enforcement
action
• March 5, 2002: Florida circuit court enters “Order On
Federal ERISA Issue”
• April 24, 2002 Debtors file for bankruptcy protection
under Chapter 13 in Southern District of
Texas, activating automatic stay against,
inter alia, Lowman’s prosecution of the
Florida enforcement action
• June 19, 2002: Lowman seeks relief from automatic stay
in Bankruptcy Court
4
• October 2, 2002: Bankruptcy Court grants relief from stay
“to allow the Florida state court
enforcement action to proceed to final
judgment”
• October 11, 2002: Debtors appeal bankruptcy order to
district court (S.D.Tex.)
• October 16, 2002: Lowman files motion for final judgment in
Florida proceeding
• October 21, 2002: Debtors file motion in Bankruptcy Court
to stay its decision and order granting
Lowman relief from automatic stay
• November 2, 2002: Florida court issues Final Judgment
• November 8, 2002: Bankruptcy Court denies Debtors’ motion
to stay its decision and its order
lifting automatic stay
• December 2, 2002: In absence of an appeal by Karen, Florida
judgment becomes final and no longer
appealable
• August 7, 2003: District court for Southern District of
Texas reverses Bankruptcy Court, orders
stay reinstated
• September 4, 2003: Lowman appeals district court order to
this court
• April 25, 2003: Bankruptcy Court orders Debtors’ case
converted from Chapter 13 to Chapter 7
• December 30, 2003: Debtors discharged in bankruptcy under
Chapter 7; automatic stay expires
automatically pursuant to 11 U.S.C. §
362(c)(2)(C)
• March 9, 2004: Debtors file motion to dismiss this
appeal as moot
• April 30, 2004: Panel of this court orders dismissal
motion carried with this appeal
II. ANALYSIS
5
Both protagonists in this procedural chess match now insist
that the instant appeal is moot, albeit they differ significantly
as to when and why it became moot. As mootness is jurisdictional
and we must examine our appellate jurisdiction, on our own motion
if need be, we are obligated to determine de novo whether the
instant appeal is moot.2
“A controversy becomes moot where, as a result of intervening
circumstances, there are no longer adverse parties with sufficient
legal interest to maintain the litigation....A controversy can also
become moot when the parties lack a legally cognizable interest in
the outcome.”3 “A moot case presents no Article III case or
controversy, and a court has no constitutional jurisdiction to
resolve the issues it presents.”4
The Debtors insist that mootness occurred on —— but not before
—— December 30, 2003, the date on which they received their Chapter
7 bankruptcy discharge which ipso facto dissolved the automatic
stay. They argue that, because the instant appeal is from an order
that the district court granted before the automatic stay
evaporated on discharge, the appeal of that order to us became moot
when the automatic stay itself became moot on discharge. This,
2
See Harris v. City of Houston, 151 F.3d 186, 189 (5th Cir.
1998).
3
Chevron, U.S.A., Inc. v. Trailour Oil Co., 987 F.2d 1138,
1153 (5th Cir. 1993)(internal citations omitted).
4
Goldin v. Barthalow (In re Goldin), 166 F.3d 710, 717 (5th
Cir. 1999).
6
they contend, eliminated any possibility of our issuing a ruling
that could affect the rights of the parties. As such, reason the
Debtors, the district court’s reversal of the Bankruptcy Court’s
order is final and no longer appealable. They thus assert that the
Florida judgment is a nullity because it was rendered (and became
final) at a time when the automatic stay was in full force and
effect. Stated differently, the mootness of the appeal of the
district court’s reversal of the Bankruptcy Court means that the
automatic stay was in effect —— not lifted —— when the Florida
judgment was rendered, making it void ab initio.
Despite being the appellant, Lowman too insists that this
appeal is moot. She urges that, in addition to our obligation to
satisfy ourselves that we have appellate jurisdiction, we must also
ensure that the court who’s ruling is under review had jurisdiction
to issue such ruling.5 Lowman adds that “[i]f the district court
lacked jurisdiction ‘[this court’s] jurisdiction extends not to the
merits but merely for the purpose of correcting the error of the
lower court.’”6 Thus, urges Lowman, even in a moot appeal such as
this one, we “retain authority to order vacatur of a moot
case....If mootness occurred prior to the rendering of a final
judgment by the district court, vacatur and dismissal is
5
See Bauhaus USA, Inc. v. Copeland, 292 F.3d 439, 442 (5th
Cir. 2002).
6
United States v. Key, 205 F.3d 773, 774 (5th Cir. 2000)
citing New York Life Ins. Co. v. Deshotel, 142 F.3d 873 882 (5th
Cir. 1998).
7
automatic.”7 Lowman thus argues that, in addition to dismissing
this appeal for mootness, we are obligated to determine whether the
case appealed from was already moot when the district court entered
the appealed order, and if it was, to vacate the district court’s
order when we dismiss this appeal.
According to Lowman, the question of the automatic stay in
bankruptcy had become moot before the district court ruled. Thus,
even though the parties agree that the controversy before the
Bankruptcy Court became moot no later than the time of Debtors’
discharge under Chapter 7 on December 30, 2003, Lowman differs from
the Debtors as to the date when mootness occurred, viz., almost a
year earlier, on December 2, 2002, when the Florida court’s
judgment became final and unappealable. By ending the “case or
controversy” between the parties, that finality produced mootness.
As that date followed the Bankruptcy Court’s order lifting the stay
but preceded the district court’s order reversing that Bankruptcy
Court order, argues Lowman, the district court’s order being
appealed to us is itself moot, leaving the Bankruptcy Court’s pre-
mootness, stay-lifting order in place and not appealable to either
the district court or us. As such, the final and unappealable
Florida judgment remains valid because the automatic stay had been
validly lifted and thus was not in place (1) when the state court’s
judgment was rendered or (2) when that judgment became final and no
7
Goldin, 166 F.3d at 718 (emphasis in original).
8
longer appealable. That, in turn, ended the case or controversy
between Lowman and Karen, leaving no live case for the district
court to decide by reversing (or, for that matter, affirming) the
Bankruptcy Court.
We agree with Lowman. Regardless whether, sometime in the
future, the judgment of the Florida circuit court should be the
declared null ab initio for violating ERISA’s preemptive ban on
both voluntary and involuntary alienation, that judgment is the
matter lying at the heart of this federal litigation. When that
state court judgment became final and no longer appealable on
December 2, 2002, at a time when the automatic stay remained lifted
for the limited purpose of letting that happen, the Article III
case or controversy in the federal courts ceased to exist.
Consequently, anything that the Bankruptcy Court or the district
court purported to do with regard to that judgment after December
2, 2002 was moot for lack of a live controversy.
It is axiomatic that the controversy between these parties
could not have become “more moot” as a result of the subsequent
evaporation of the automatic stay when, more than a year after the
Florida judgment became final and no longer appealable, the Debtors
were discharged under Chapter 7: There is no such thing as being
a little bit moot. Under the doctrine of mootness, the district
court no longer had jurisdiction to entertain Debtors’ appeal from
the Bankruptcy Court’s order of October 2, 2002 once the Florida
judgment became final two months later. Stated differently, the
9
matter became moot on December 2, 2002, before the district court’s
2003 order purporting to reverse the Bankruptcy Court, and before
the Debtors’ 2003 discharge under Chapter 7. As we recognized in
Goldin,8 when a matter on appeal is determined to have become moot,
not merely prior to or during the appeal but prior to the date of
the order being appealed from, we must dismiss as moot the appeal
before us and vacate as moot the ruling from which the appeal was
sought. That is the course we are compelled to take today.
III. CONCLUSION
To recap, the district court’s order that was appealed to us
is moot because the Florida state court judgment had become final
and no longer appealable long before the district court purported
to reverse the Bankruptcy Court (and even longer before the
Debtors’ Chapter 7 discharge). Consequently, by the time the
district court acted in August of 2003, the sole case or
controversy between the parties had ceased to exist as a matter of
law. Under the doctrine of mootness, this deprived the district
court of jurisdiction, making its order reversing the Bankruptcy
Court void ab initio and the appeal of that order moot, thereby
depriving us of appellate jurisdiction. Thus, the only federal
court ruling left uninfected by mootness was the Bankruptcy Court’s
October 2, 2002 order lifting the automatic stay and keeping it
lifted until after the Florida judgment had become final, non-
8
In re Goldin, 166 F.3d 710 (5th Cir. 1999).
10
appealable, and executory. We therefore dismissal this appeal and
vacate the order of the district court, both under the doctrine of
mootness, for lack of jurisdiction.
APPEAL DISMISSED; DISTRICT COURT ORDER VACATED.
11