Gugliuzza v. Federal Trade Commission
852 F.3d 884
| 9th Cir. | 2017Background
- FTC obtained an $18.2 million restitution judgment against Charles Gugliuzza (Commerce Planet) for deceptive practices under §5 of the FTC Act; Gugliuzza filed Chapter 7 bankruptcy.
- FTC sued in the bankruptcy adversary proceeding, seeking a §523(a)(2)(A) ruling that the restitution debt is nondischargeable as obtained by fraud.
- Bankruptcy court granted summary judgment for the FTC, holding collateral estoppel applied to preclude relitigation of the five nondischargeability elements.
- District court affirmed in part, reversed in part: it held collateral estoppel applied to four elements (misrepresentation, knowledge, reliance, damages) but remanded for further fact-finding on Gugliuzza’s intent to deceive.
- Gugliuzza appealed the district court’s partial reversal/remand; the Ninth Circuit considered whether it had jurisdiction to hear that appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court of appeals has jurisdiction under 28 U.S.C. §§ 1291/1292/158(d)(1) to hear appeal of district court’s partial reversal and remand | Gugliuzza argued the order was reviewable because it involved legal rulings (collateral estoppel) and could be resolved without further factfinding | Government/FTC and courts argued the order remanded a central issue for fact-finding and did not end the adversary proceeding, so it was not final for §158(d)(1) | No jurisdiction; appeal dismissed |
| Whether Bullard’s finality test (orders that end a discrete proceeding are appealable) applies to limit interlocutory appeals here | Gugliuzza contended Bonner Mall line (allowing appeals of legal questions that could dispose of case) should govern | Court concluded Bullard governs and narrows Bonner Mall; only orders that finally alter rights/obligations in a discrete proceeding are immediately appealable | Bullard controls; remand order is not final under Bullard |
| Whether Bonner Mall (and progeny) permits appellate review despite a remand for factual findings because the issues are legal/pure questions | Gugliuzza relied on Bonner Mall, Dawson, Lehtinen to argue this appeal raises legal issues that could dispose of or materially aid remand | Court held Bonner Mall is inconsistent with Bullard and Landmark Fence to the extent it permits merits-peeking to find jurisdiction | Bonner Mall line is effectively overruled by Bullard; cannot assert jurisdiction by resolving legal issues that would aid remand |
| Whether the remand was ministerial (so exception to non-finality applies) | Gugliuzza implied limited fact-finding would make appeal appropriate | FTC/district court argued remand requires genuine fact-finding (intent inquiry), not a mere mechanical task | Remand requires factfinding on intent (not ministerial); ministerial exception does not apply |
Key Cases Cited
- Bullard v. Blue Hills Bank, 135 S. Ct. 1686 (2015) (defines finality in bankruptcy: only orders that end a discrete proceeding by fixing parties’ rights are immediately appealable)
- In re Landmark Fence Co., 801 F.3d 1099 (9th Cir. 2015) (applies Bullard and holds district-court remand for further fact-finding is not final and not appealable)
- In re Bonner Mall P’ship, 2 F.3d 899 (9th Cir. 1993) (prior test allowing appeals where deciding a legal question could dispose of the case; court limits its continued applicability)
- Sasson v. Sokoloff (In re Sasson), 424 F.3d 864 (9th Cir. 2005) (collateral estoppel applies in §523 discharge exception proceedings)
- Turtle Rock Meadows Homeowners Ass’n v. Slyman (In re Slyman), 234 F.3d 1081 (9th Cir. 2000) (elements required to prove nondischargeability under §523(a)(2)(A))
- Conn. Nat’l Bank v. Germain, 503 U.S. 249 (1992) (§1291 gives courts of appeals jurisdiction over final decisions by district courts acting in any capacity)