14‐3688‐bk In Re: Coudert Bros. LLP
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
August Term 2015
(Argued: August 20, 2015 Decided: December 29, 2015)
Docket No. 14‐3688‐bk
IN RE: COUDERT BROTHERS LLP,
Debtor.
STATEK CORPORATION,
Appellant,
v.
DEVELOPMENT SPECIALISTS, INC., Plan Administrator for Coudert Brothers LLP,
Appellee.
ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
Before: CABRANES, POOLER, and CHIN, Circuit Judges.
Appeal from an order of the United States District Court for the
Southern District of New York (Swain, J.), affirming orders of the United States
Bankruptcy Court for the Southern District of New York (Drain, J.), denying
appellantʹs motions for reconsideration of an order disallowing a claim. On
appeal, appellant argues that the bankruptcy courtʹs orders do not comply with
this Courtʹs mandate in a prior appeal in this case. Because we conclude that the
bankruptcy court did not give full effect to our mandate, which impliedly
foreclosed the bankruptcy court from relying on its prior alternative holding, we
reverse and remand with further instructions.
REVERSED AND REMANDED.
ANTHONY W. CLARK (Thomas J. Allingham II, Dain A. De Souza, J. Eric Ivester, on the brief), Skadden, Arps, Slate, Meagher & Flom LLP, Wilmington, Delaware, and New York, New York, for Appellant Statek Corporation
DAVID S. TANNENBAUM, Stern Tannenbaum & Bell LLP, New York, New York, for Appellee Development Specialists, Inc.
‐ 2 ‐ CHIN, Circuit Judge:
This case returns to us after our previous remand in Statek Corp. v.
Development Specialists, Inc. (In re Coudert Bros. LLP) (ʺCoudert Iʺ), 673 F.3d 180 (2d
Cir. 2012), which in part vacated the bankruptcy courtʹs denial of a motion to
reconsider an order disallowing a claim. Appellant Statek Corp. (ʺStatekʺ)
appeals from a September 19, 2014 order of the United States District Court for
the Southern District of New York (Swain, J.), which affirmed orders of the
United States Bankruptcy Court for the Southern District of New York (Drain, J.),
dated August 23, 2013, and October 25, 2013, that again, on remand, denied
reconsideration. In denying Statekʹs latest motions for reconsideration, the
bankruptcy courtʹs decisions relied on a prior alternative holding ‐‐ that Statekʹs
argument was a ʺnew argumentʺ not proper for a motion for reconsideration ‐‐
which this Court did not explicitly address in Coudert I.
Statek now challenges the bankruptcy courtʹs decisions on the
ground that they do not comply with our mandate in Coudert I. For the reasons
set forth below, we remand for the district court to instruct the bankruptcy court
to reverse its orders denying reconsideration, vacate its claim disallowance order,
and reinstate Statekʹs claim.
‐ 3 ‐ BACKGROUND
This dispute arises out of Statekʹs claim in bankruptcy against
Coudert Brothers LLP (ʺCoudertʺ), a now‐defunct New York law firm and debtor
in bankruptcy. See Coudert I, 673 F.3d at 183‐84. The underlying facts are set
forth in detail in our prior opinion. See id. at 183‐85. We briefly restate the
allegations in Statekʹs complaint.
From 1984 until 1996, Statek was controlled by Hans Frederick
Johnston, who looted its treasury. In 1990, Johnston caused Statek to retain
Coudert as counsel, and thereafter Coudert helped him hide his pilfered assets.
After Statek removed Johnston from power, Coudert failed to turn
over files and other materials relating to the Johnston years ‐‐ information to
which Statek was entitled as a former client. Because of this nondisclosure, it
was not until 2004 that Statek finally learned of Coudertʹs role in laundering
Johnstonʹs assets. Coudertʹs malpractice caused Statek to undergo a prolonged,
global search for its assets, at a cost of $85 million.
By complaint dated October 28, 2005, Statek sued Coudert for
malpractice in Connecticut state court. Coudert soon went bankrupt, and its
September 22, 2006 petition for Chapter 11 bankruptcy in the Southern District of
‐ 4 ‐ New York automatically stayed the Connecticut action. See 11 U.S.C. § 362. On
March 23, 2007, Statek removed the Connecticut action to the United States
District Court for the District of Connecticut pursuant to 28 U.S.C. § 1452. And
on May 10, 2007, Statek filed a proof of claim in the bankruptcy court, attaching
as an exhibit the original Connecticut action complaint.
In bankruptcy, appellee Development Specialists, Inc., the plan
administrator (the ʺPlan Administratorʺ), moved to disallow Statekʹs claim as
time‐barred. On July 21, 2009, the bankruptcy court granted that motion (the
ʺClaim Disallowance Orderʺ) (Drain, J.). The bankruptcy court reasoned that
New York choice‐of‐law rules applied under the Erie doctrine, and New Yorkʹs
ʺborrowing statuteʺ requires claims to satisfy both the relevant New York statute
of limitations and the limitations period of the state where the cause of action
accrued. See N.Y. C.P.L.R. § 202. The bankruptcy court found that Statek did not
satisfy those requirements.
Statek moved for reconsideration, arguing that the bankruptcy court
had erroneously applied the Erie doctrine by not treating the bankruptcy court as
the transferee court for the Connecticut action. See generally Ferens v. John Deere
Co., 494 U.S. 516 (1990) (holding federal courts follow choice‐of‐law rules of the
‐ 5 ‐ transferor court). On September 8, 2009, the bankruptcy court denied that
motion, employing the Federal Rule of Civil Procedure 59(e) standard. See 11
U.S.C. § 502(j); Fed. R. Bankr. P. 9023 (directing application of Rule 59). The
bankruptcy court reasoned that the ʺtransferee courtʺ argument was ʺnever
raisedʺ before and therefore was a new argument that could not be considered on
reconsideration. In re Coudert Bros. LLP, No. 06‐12226(RDD), 2009 WL 2928911, at
*2 (Bankr. S.D.N.Y. Sept. 8, 2009). Moreover, the bankruptcy court held, ʺthe
argument [was] mistakenʺ because Statekʹs claim was filed in New York and so
there was no transfer. Id. at *3. Following Statekʹs appeal, the district court
affirmed (Hellerstein, J.). In re Coudert Bros. LLP, No. 09 Civ. 9561(AKH), 2010
WL 2382397, at *4 (S.D.N.Y. June 14, 2010).
In Coudert I, we reversed. We first noted that we did not have
subject matter jurisdiction over the Claim Disallowance Order because it was
untimely appealed. Coudert I, 673 F.3d at 185‐86 & n.6 (holding Federal Rule of
Bankruptcy Procedure 8002(a)ʹs appeal deadline is jurisdictional). But we
vacated the denial of Statekʹs motion for reconsideration and agreed with Statekʹs
ʺtransferee courtʺ reconsideration argument. We held, on this ʺquestion of first
impression,ʺ that for practical purposes the bankruptcy court was to be treated as
‐ 6 ‐ the transferee court of the Connecticut action. Id. at 188, 190‐91. Therefore, we
ruled, Connecticut choice‐of‐law rules applied to Statekʹs bankruptcy claim. We
then instructed:
The portion of the district courtʹs order affirming the bankruptcy courtʹs denial of Statekʹs motion for reconsideration is REVERSED, and the case is REMANDED to the district court with instructions to REMAND IN PART to the bankruptcy court with instructions to apply Connecticutʹs choice of law rules in deciding Statekʹs motion to reconsider.
Id. at 191; see also id. at 183 (instructing ʺbankruptcy court to apply the choice of
law rules of Connecticut to decide Statekʹs motion for reconsiderationʺ). We did
not, however, specifically address the alternative holding that the ʺtransferee
courtʺ argument has been raised for the first time on the motion for
reconsideration.
On remand, the bankruptcy court ordered additional briefing on
whether it could still adhere to that alternative holding. On August 19, 2013, it
concluded in In re Coudert Bros. LLP (ʺCoudert IIʺ), No. 06‐12226(RDD), 2013 WL
4478824, at *2, *11 (Bankr. S.D.N.Y. Aug. 19, 2013), that it could. The bankruptcy
court found, as an initial matter, that Connecticut choice‐of‐law rules pointed to
Connecticutʹs statute of limitations. While Statekʹs malpractice claim would be
barred by Connecticutʹs three‐year limitations period for tort suits ‐‐ Coudert
‐ 7 ‐ failed to comply with Statekʹs requests in July 1996, and Statek sued in
November 2005 ‐‐ the bankruptcy court acknowledged that Connecticutʹs
ʺcontinuing course of conductʺ doctrine possibly provided an exception. Id. at *4.
But the bankruptcy court ultimately concluded that this doctrine ʺdo[es] not lead
to a clear answer on the timeliness of the Claimʺ and that there is ʺno manifest
answer to whether the Claim should be allowed.ʺ Id. at *3, *8.
Instead, in Coudert II, the bankruptcy court held that its alternative
basis for denying reconsideration ‐‐ that Statekʹs ʺtransferee courtʺ argument was
a new argument ‐‐ continued to apply. See id. at *8‐10. In so concluding, the
bankruptcy court determined that relying on its prior alternative holding
complied with our mandate in Coudert I. See id. at *11‐13.
After Coudert II, Statek asked for reconsideration once again,
requesting that the bankruptcy court reconsider Coudert II and lift the stay of the
Connecticut action so that Statek could amend its claim to plead additional facts
relevant to the ʺcontinuing course of conductʺ doctrine. On October 25, 2013, the
bankruptcy court denied that motion. On September 23, 2014, the district court
affirmed both denials of reconsideration for substantially the reasons relied on by
‐ 8 ‐ the bankruptcy court (Swain, J.). See In re Coudert Bros. LLP, No. 13‐CV‐8578‐LTS‐
FM (S.D.N.Y. Sept. 19, 2014).
This appeal followed.
DISCUSSION
When reviewing a bankruptcy court decision that was appealed to a
district court, we ʺreview the bankruptcy courtʹs decision independent of the
district courtʹs review.ʺ Coudert I, 673 F.3d at 186. Typically, ʺ[a] bankruptcy
courtʹs denial of a motion to reconsider a disallowed claim is a discretionary
decision.ʺ Id. ʺHere, however, that discretion was cabined by the mandateʺ in
Coudert I. Puricelli v. Republic of Argentina, 797 F.3d 213, 218 (2d Cir. 2015). A
lower court has ʺno discretion in carrying out the mandate.ʺ In re Ivan F. Boesky
Sec. Litig., 957 F.2d 65, 69 (2d Cir. 1992). We therefore review de novo ʺwhether
the judgment comports with [the] mandate.ʺ Carroll v. Blinken, 42 F.3d 122, 126
(2d Cir. 1994).
On appeal, Statek primarily argues that the bankruptcy courtʹs
decisions on remand ran afoul of our mandate in Coudert I. The ʺmandate ruleʺ
has existed since the ʺearliest daysʺ of the judiciary. Briggs v. Pa. R.R. Co., 334
‐ 9 ‐ U.S. 304, 306 (1948). By that rule, a lower court ʺmust follow the mandate issued
by an appellate court.ʺ Puricelli, 797 F.3d at 218.
In following a mandate, the lower court must carry out its duty to
give the mandate ʺfull effect.ʺ Ginett v. Comput. Task Grp., Inc., 11 F.3d 359, 360‐61
(2d Cir. 1993) (citing In re Sanford Fork & Tool Co., 160 U.S. 247, 255 (1895)); see
United States v. E. I. du Pont de Nemours & Co., 366 U.S. 316, 325 (1961) (concluding
mandate must be ʺscrupulously and fully carried outʺ). The lower court ʺcannot
vary it, or examine it for any other purpose than execution; or give any other or
further relief; or review it, even for apparent error, upon any matter decided on
appeal; or intermeddle with it, further than to settle so much as has been
remanded.ʺ In re Sanford, 160 U.S. at 255; accord Vendo Co. v. Lektro‐Vend Corp., 434
U.S. 425, 427‐28 (1978).
But the mandate is controlling only ʺas to matters within its
compass.ʺ New Eng. Ins. Co. v. Healthcare Underwriters Mut. Ins. Co., 352 F.3d 599,
606 (2d Cir. 2003) (quoting Sprague v. Ticonic Natʹl Bank, 307 U.S. 161, 168 (1939)).
When the mandate leaves issues open, the lower court may dispose of the case
on grounds not dealt with by the remanding appellate court. See Ex parte Century
Indem. Co., 305 U.S. 354, 355‐56 (1938) (finding no error that lower court ʺfound
‐ 10 ‐ another ground for its action, ‐‐ a ground not dealt with in its former ruling and
not presentedʺ by the first appeal); Sompo Japan Ins. Co. of Am. v. Norfolk S. Ry. Co.,
762 F.3d 165, 175 (2d Cir. 2014) (finding no violation where lower court
addressed ʺon remand an issue that was not decided by this Court in the original
appeal,ʺ that ʺ[t]he [original] appeal did not raise,ʺ and that was developed
through further discovery). But see Parmalat Capital Fin. Ltd. v. Bank of Am. Corp.,
671 F.3d 261, 270‐71 (2d Cir. 2012) (ʺHere, both the ʹspecific dictates of the
mandateʹ and the ʹspirit of the mandateʹ focus entirely on the question of timely
adjudication . . . . It is not reasonable to construe the mandate as allowing
alternative, dispositive bases . . . to be raised for the first time on remand . . . .ʺ).
We therefore must examine the scope of our mandate in Coudert I.
The scope of a mandate may extend beyond express holdings, and
precludes relitigation both of ʺmatters expressly decided by the appellate courtʺ
and of ʺissues impliedly resolved by the appellate court[].ʺ Sompo Japan, 762 F.3d
at 175 (quoting Brown v. City of Syracuse, 673 F.3d 141, 147 (2d Cir. 2012)). A
mandate, therefore, may expressly dispose of certain issues raised on appeal, or
if the disposition of an issue is ʺnecessarily impliedʺ by our decision, a mandate
‐ 11 ‐ may also foreclose such an issue from being considered by the lower court.
Sprague, 307 U.S. at 168.
A mandate may also, by its terms, further ʺlimit[] issues open for
consideration on remand.ʺ Puricelli, 797 F.3d at 218. Of course, ʺwhere a
mandate directs a district court to conduct specific proceedings and decide
certain questions, generally the district court must conduct those proceedings
and decide those questions.ʺ Id. (citing 18B Charles Alan Wright, et al., Federal
Practice and Procedure § 4478.3, at 753‐54 (2d ed. 2002) [hereinafter ʺWright &
Millerʺ]). But the inquiry is broader. The district court must follow ʺboth the
specific dictates of the remand order as well as the broader ʹspirit of the
mandate.ʹʺ United States v. Ben Zvi, 242 F.3d 89, 95 (2d Cir. 2001) (quoting United
States v. Kikumura, 947 F.2d 72, 76 (3d Cir. 1991)); see Himely v. Rose, 9 U.S. (5
Cranch) 313, 316 (1809) (Marshall, C.J.) (asking ʺwhether [mandate] has been
executed according to its true intent and meaningʺ).
Far from giving full effect to our mandate in Coudert I, the
bankruptcy court here essentially gave it no legal effect. In Coudert I, we
instructed the bankruptcy court ʺto apply Connecticutʹs choice of law rules in
deciding Statekʹs motion to reconsider.ʺ 673 F.3d at 191. The bankruptcy court
‐ 12 ‐ did not follow that instruction, as the Connecticut choice‐of‐law rules did not
bear on the bankruptcy courtʹs ultimate decision. Instead, the bankruptcy court
ordered further briefing on whether it could adhere to its prior alternative
holding that Statekʹs argument was a new argument not available on
reconsideration. The bankruptcy court concluded that it could, and disposed of
the case on that basis. See Coudert II, 2013 WL 4478824, at *8‐10.
While the bankruptcy court did address Connecticutʹs choice‐of‐law
rules, its decision fell short of applying them ‐‐ it merely considered them. The
bankruptcy court conducted an analysis of the Connecticut statute of limitations,
which operated through Connecticutʹs choice‐of‐law rules. Id at *3‐8. Those
timeliness rules, the bankruptcy court supposed, led to no ʺclear answer.ʺ Id. at
*3, *8. The bankruptcy court erred, however, by not pursuing the Rule 59 inquiry
further. See E. I. du Pont, 366 U.S. at 325 (holding mandate must be ʺscrupulously
and fully carried outʺ). The absence of a ʺclear answerʺ was no reason to
abandon the issue to be decided pursuant to the mandate.
What impelled the bankruptcy courtʹs decision was instead its prior
alternative holding. The bankruptcy court reasoned that even if a full inquiry
into the Connecticut statute of limitations ʺcould possibly have changed the
‐ 13 ‐ outcome of the case,ʺ it would not matter, because the bankruptcy court ʺʹshould
not be required to respond to new arguments now.ʹʺ Coudert II, 2013 WL
4478824, at *10 (quoting Analytical Surveys, Inc. v. Tonga Partners, L.P., No. 06 Civ.
2692(KMW)(RLE), 2009 WL 1514310, at *3 (S.D.N.Y. May 29, 2009)). Indeed, the
bankruptcy court hypothesized that application of the Connecticut statute of
limitations would change the outcome of the Claim Disallowance Order because
there were ʺinsufficient grounds to grant the motion to [disallow].ʺ App. at 828.
By the bankruptcy courtʹs analysis, it seems, the proper application of
Connecticut choice‐of‐law rules would have required reconsidering and vacating
its Claim Disallowance Order. In relying on a prior alternative holding, the
bankruptcy court failed to effectuate Coudert Iʹs mandate.
We must consider, then, whether the scope of the mandate was so
narrow as to permit the bankruptcy court to dispose of the case in this manner,
that is, by relying on a prior alternative holding. We did not expressly address in
Coudert I the merits of whether Statekʹs ʺtransferee courtʺ argument was a new
argument cognizable on reconsideration. Nonetheless, we impliedly foreclosed
that ground of decision in Coudert I.
‐ 14 ‐ As a general matter, it is an uncompromising rule that lower courts
may not hear ʺarguments . . . that could have been raised prior to the entry of
judgment.ʺ Exxon Shipping Co. v. Baker, 554 U.S. 471, 485 n.5 (2008) (quoting 11C
Wright & Miller § 2810.1, at 127‐28). This Court also ʺ[g]enerally . . . will not
consider an argument on appeal that was raised for the first time below in a
motion for reconsideration.ʺ Official Comm. of Unsecured Creditors of Color Tile,
Inc. v. Coopers & Lybrand, LLP, 322 F.3d 147, 159 (2d Cir. 2003). But this rule, for
us, is not absolute; it exists as a matter of ʺprudence.ʺ Id. (quoting Baker v.
Dorfman, 239 F.3d 415, 420 (2d Cir. 2000) (providing exceptions)).
It follows that when we do consider on appeal arguments raised for
the first time below in a motion for reconsideration and remand on the basis of
those arguments, the lower court must follow our mandate. See, e.g., Wojtowicz v.
United States, 550 F.2d 786, 790 (2d Cir. 1977) (remanding for competency hearing
despite competence being raised for first time in motion for reconsideration). In
other words, if we elect to consider a new argument on appeal, on remand the
lower court may not ignore our ruling on the basis that we relied on a non‐
cognizable ʺnew argument.ʺ By remanding in this case, we necessarily implied
‐ 15 ‐ that Statekʹs ʺtransferee courtʺ argument should not be disregarded as a ʺnew
argument.ʺ
In Coudert I, we addressed at length whether Connecticut choice‐of‐
law rules would apply. 673 F.3d at 186‐91. That question was Coudert Iʹs
overwhelming focus. See Parmalat, 671 F.3d at 270‐71 (finding when mandate
ʺfocus[es] entirely on [one] questionʺ other ʺalternative, dispositive basesʺ are
ʺʹimpliedly decidedʹʺ). If we thought an alternative, dispositive holding would
altogether preclude application of Connecticutʹs choice‐of‐law rules, ʺwe would
have affirmed . . . ; there would have been no need for a [remand].ʺ Kerman v.
City of New York, 374 F.3d 93, 111 (2d Cir. 2004); see also Parmalat, 671 F.3d at 270‐
271. Indeed, we were fully aware of the bankruptcy courtʹs alternative holding
and could have adopted it ‐‐ but we did not. See Coudert I, 673 F.3d at 186 (noting
that we ʺreview the bankruptcy courtʹs decision independent of the district
courtʹs reviewʺ). Accordingly, we conclude that the bankruptcy courtʹs ʺnew
argumentʺ holding in Coudert II was impliedly foreclosed by our mandate in
Coudert I.
The Plan Administratorʹs arguments to the contrary are unavailing.
First, the Plan Administrator argues that because Coudert I instructed the
‐ 16 ‐ bankruptcy court to ʺdecideʺ the motion for reconsideration, the mandate left
open all other grounds of decision. 673 F.3d at 183, 191. Because we asked for a
decision by the bankruptcy court, the Plan Administrator contends, we impliedly
decided nothing. The Plan Administratorʹs interpretation reads out other words
from our decree ‐‐ notably, ʺto apply.ʺ As we discussed, we must have impliedly
decided enough so that our instructions would be given some legal effect.1 In
any event, we have found implied decisions where the instruction was more
general than the one in Coudert I. See, e.g., Kerman, 374 F.3d at 109‐111, vacating
No. 96 Civ. 7865(RPP), 2003 WL 328297 (S.D.N.Y. Feb. 11, 2003), remanded from
261 F.3d 229 (2d Cir. 2001) (ʺremand[ing] for further proceedings not inconsistent
with this opinionʺ); see also Fed. R. App. P. 41(a) (dictating that mandate includes
full opinion).
1 The Plan Administrator further contends that ʺif the Court of Appeals believed that the reconsideration motion was already decided, it would not have given the Bankruptcy Court this explicit instructionʺ to decide the motion. Appelleeʹs Br. at 34. But the reconsideration motion was not entirely decided by Coudert I, even if the ʺnew argumentʺ was. The bankruptcy court could have decided (but did not) that the Connecticut statute of limitations offered no possible recourse under the facts pleaded and denied the motion for reconsideration on those grounds. See, e.g., United States v. Clark, 984 F.2d 31, 34 (2d Cir. 1993) (finding no abuse of discretion where lower court ʺexplicitly considered [the motion for reconsiderationʹs] merits and denied itʺ).
‐ 17 ‐ Second, the Plan Administrator invokes a countervailing rule
derived from the related law‐of‐the‐case doctrine.2 The Plan Administrator
contends that the bankruptcy court correctly adhered to its original ruling on the
ʺnew argumentʺ issue, which is the ʺlaw of the case.ʺ See generally Burrell v.
United States, 467 F.3d 160, 165 n.3 (2d Cir. 2006) (discussing ʺmajor groundsʺ for
ʺdepart[ing] from the sound policy of adhering to [a] prior rulingʺ). But this rule
only operates ʺin the absence of an intervening ruling on the issue by a higher
court.ʺ United States v. Quintieri, 306 F.3d 1217, 1225 (2d Cir. 2002). Here, Coudert
I was that intervening ruling by a higher court.
Third, and finally, the Plan Administrator argues that because the
ʺnew argumentʺ issue was not ʺsquarely presentedʺ to us in Coudert I, we could
not have impliedly decided it. Though the doctrines are related, this argument
mistakes the requirements of the mandate rule with waiver. See 18B Wright &
Miller § 4478.6, at 821 (3d ed. 2012) (explaining difference between ʺlaw of the
caseʺ and ʺforfeitureʺ or ʺwaiverʺ). Our mandate impliedly decides at least
enough issues to allow it to be effective, even if not all issues are made explicit.
See Ginett, 11 F.3d at 360‐61; see, e.g., Parmalat, 671 F.3d at 270‐71 (rejecting as
2 Though our Court has long considered the mandate rule as a branch of the law‐of‐the‐case doctrine, see, e.g., Sompo Japan, 762 F.3d at 175, those doctrines are not, strictly speaking, one and the same.
‐ 18 ‐ impliedly decided ʺalternative, dispositive basesʺ not raised in prior appeal); Yick
Man Mui v. United States, 614 F.3d 50, 53 (2d Cir. 2010) (finding ʺfactual
predicates of . . . claims, while not explicitly raised on direct appeal, were
nonetheless impliedly rejected by the appellate court mandateʺ); Burrell, 467 F.3d
at 165 (holding mandate impliedly decides that resentencing de novo usually
required when it reverses a conviction and remands for resentencing); Kerman,
374 F.3d at 109‐11 (finding existence of ʺclearly established rightʺ impliedly
decided though it was not raised).
Of course, in some cases, this Court chooses to expressly address
alternative holdings, and in other cases, we state that we express no view on
them, leaving those alternatives open for the lower court to reconsider. See, e.g.,
Am. Hotel Intʹl Grp., Inc. v. OneBeacon Ins. Co., 374 Fed. Appʹx 71, 74 (2d Cir. 2010)
(finding prior mandate limited scope by stating it ʺexpress[ed] no viewʺ on other
issues); see also United States v. Johnson, 378 F.3d 230, 240 (2d Cir. 2004) (ʺThe
general mandate rule can be avoided by specific instructions . . . .ʺ). In this case,
we did not include any such express language, and, indeed, our mandate was
clear enough: The bankruptcy court was instructed to apply Connecticut law. It
did not do so.
‐ 19 ‐ Because we determine that the bankruptcy court derogated from our
mandate in Coudert I, we consider the appropriate instructions on remand.
Generally, ʺthe appellate court retains the right to control the actions of the
[lower] court where the mandate has been misconstrued or has not been given
full effect.ʺ Ginett, 11 F.3d at 360‐61. We fashion instructions to give Coudert I
that effect.
It is clear that the bankruptcy court would have vacated the Claim
Disallowance Order had it not misconstrued our mandate. During a hearing, the
bankruptcy court concluded that Statek pleaded sufficient facts to overcome the
Plan Administratorʹs motion to disallow the claim. The bankruptcy court stated:
[N]ow that Iʹm instructed to apply Connecticut Choice of Law principles I would conclude that under Connecticut law, I would apply the Connecticut limitations law, not some other jurisdictionʹs limitation law. And further, I would conclude that there is insufficient or are insufficient grounds to grant the motion to [disallow] because of the facts necessary to decide the tolling for continuing conduct.
App. at 828. In its written decision, the bankruptcy court reiterated that the facts
in the record did not lead to a ʺclear answerʺ sufficient to permit it to rule on the
timeliness issue in the Plan Administratorʹs favor. Coudert II, 2013 WL 4478824,
at *3. The bankruptcy court should have, by its finding that there were
‐ 20 ‐ insufficient grounds to grant a motion to disallow without further facts, reversed
its orders denying reconsideration and vacated the Claim Disallowance Order.
Statek should have been allowed to proceed with its claim.
CONCLUSION
For the foregoing reasons, the district courtʹs order affirming the
August 23, 2013 and October 25, 2013 orders of the bankruptcy court is
REVERSED, and the case is REMANDED to the district court with directions to
REMAND to the bankruptcy court with instructions to: (1) reverse its orders
denying reconsideration, (2) vacate the Claim Disallowance Order, (3) reinstate
Statekʹs claim, and (4) permit further proceedings in a manner consistent with
this opinion.
‐ 21 ‐