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November 18, 1959


The opinion of the court was delivered by: Mercer, Chief Judge.

This cause arises upon a complaint alleging trade-mark infringement and unfair competition. Defendants answered, pleading, inter alia, laches as a defense to plaintiff's claims.

On September 30, 1959, on defendant's motion, this court ordered a separate trial of the laches issue in advance of trial of other issues in the case. Thereafter, on October 20, 1959, on plaintiff's motion, the September 30th order was modified in minor particulars which are not pertinent to disposition of the question now before the court. Subsequently, plaintiff filed a motion to amend the September 30th order, as modified, by inserting therein conditional findings enumerated in 28 U.S.C. § 1292(b) to permit plaintiff to prosecute an immediate appeal therefrom.

Section 1292(b), added to the interlocutory appeals statute by the Act of September 2, 1958, 72 Stat. 1770, provides as follows:

That statute was born of Congress' recognition of the fact that an immediate appeal from an otherwise non-appealable order might in certain cases aid the efficient functioning of the judicial process. See, Summary of legislative history, Milbert v. Bison Laboratories, 3 Cir., 260 F.2d 431, 432, et seq. To the extent that its use is restricted to exceptional cases and exceptional circumstances, the statute can serve a beneficent purpose in expediting the ultimate determination of protracted litigation. Without such restriction, rigidly applied, the statute contains the seeds of serious abuse which could go far to abrogate the salutary principle that "piecemeal" appeals will not be permitted. That the prospect of an immediate appeal from pre-trial orders does excite the imagination of legal advocates is attested by the large numbers of reported cases which have sprung up in the scant year of the statute's life.

It seems obvious that Congress feared the statute's tendency to invite abuse because it interposed the concurrent action of two separate courts before an appeal will lie under the statute. First, as a part of its order, the district court must find that the "order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation." After such a finding has been made by the district court, the "Court of Appeals may" upon application made "within ten days after the entry of" such order "in its discretion, permit an appeal to be taken from such order." As interpreted by the courts, the latter condition requires the Court of Appeals to make its own independent determination as to the existence of all statutory conditions before leave to appeal will be granted. In re Heddendorf, 1 Cir., 263 F.2d 887, 889; United States v. Woodbury, 9 Cir., 263 F.2d 784, 786. In Heddendorf, the court stated the principle in the following language:

    "[Upon every application for leave to appeal,]
  the appellate court should at least concur with
  the district court in the opinion that the
  proposed appeal presents a difficult central
  question of law which is not settled by
  controlling authority, and that a prompt decision
  by the appellate court at this advanced stage
  would serve the cause of justice by accelerating
  `the ultimate termination of the litigation.'
    "In applying these standards, the court
  must weigh the asserted need for the proposed
  interlocutory appeal with the policy in the
  ordinary case of discouraging `piecemeal
  appeals'." 263 F.2d 889.

As the above cases correctly imply, whenever leave to appeal under Section 1292(b) is requested the court to which that request is addressed must make an independent evaluation of all the circumstances of the particular case to determine whether an immediate appeal ought to be allowed. It is not perceived how any hard and fast rules for application of the statute can be devised by decision. In the final analysis, the only binding precedent is the statute itself, and the recognition that that statute merely creates an exception to the general rule that only final decisions are appealable in the ordinary case. It would seem that the most which judicial precedent can ever do is to serve as a guide to the court in making that independent evaluation of the circumstances which must be made in every case. In the interest of acknowledging sources which have influenced the court's reasoning and of fixing a basis for comparison of this court's views with the decisions of other courts, the reported cases in this field are summarized without comment in an appendix to this memorandum.

One cannot read the statute without an impelling conviction that it was intended to apply to the exceptional case, not to run-of-the-mill litigation. Courts which have construed the statute are largely in agreement on that principle. E.g. In re Heddendorf, supra, 263 F.2d at page 889; United States v. Woodbury, supra, 263 F.2d at page 788; n. 11; Milbert v. Bison Laboratories, supra, 260 F.2d at page 435; Biggers v. Bankers Bond Co., D.C.W.D.Ky., 171 F. Supp. 94, 95; Bobolakis v. Compania Panamena Maritima San Gerassimo, D.C.S.D.N.Y., 168 F. Supp. 236; Krach v. Texas Company, D.C., 167 F. Supp. 947. But the courts seem to part company in their determination of what is an exceptional case. There would seem to be one trend of decisions which would authorize liberal use of the statute for an immediate appeal, especially in cases where a district court has decided a jurisdictional question in favor of its having jurisdiction. E.g., Cordero v. Panama Canal Co., D.C.S.D.N.Y., 170 F. Supp. 234; Pennsylvania Turnpike Comm. v. McGinnes, D.C.E.D.Pa., 169 F. Supp. 580, leave to appeal granted and cause reversed, 3 Cir., 268 F.2d 65.

On the other hand, the more logical view is exemplified by Bobolakis v. Compania Panamena Maritima San Gerassimo, supra. Bobolakis, a citizen and resident of Greece and a seaman on one of the defendant's ships, sued for damages for personal injuries alleged to have resulted from the defendant's negligence and the unseaworthiness of the ship on which Bobolakis was employed. The defendant was a Panamanian corporation and operated its ships under Panamanian registry. The accident from which the cause arose occurred in Canadian waters. Averring the above facts, the defendant moved to dismiss the complaint for lack of jurisdiction. That motion was denied by the court on the ground that jurisdiction was present by reason of the fact that a majority of defendant's stockholders were citizens and residents of the forum. In so deciding, the court refused to follow prior decisions of the same court which had held that jurisdiction could not be predicated upon residence of stockholders alone.

In denying the defendant's motion for leave to file an immediate appeal, the court observed that it was faced with an important case in the sense that a debatable question of law which was applicable to several other pending cases would remain in doubt until the question had been fully and finally decided by the Court of Appeals, but that the importance of the case was not enough to invoke the statutory procedure for immediate appeal. In pertinent part the court said — 168 F. Supp. at page 239:

    "I believe that the legislative history [of
  Section 1292(b)] plainly indicates that the
  statute is to be invoked only in exceptional
  cases `to avoid unnecessary delay and
  expense.' I am fortified in this view as a
  result of the reading given the statute by
  the Third Circuit Court of Appeals in the
  recent case of Milbert v. Bison Laboratories
  Inc., 3 Cir., 260 F.2d 431. It is clear that
  this legislation was aimed at the `big' and
  expensive case where an unusual amount of
  time and money may be expended in the
  pre-trial phases of the case or where the
  trial itself is likely to be long and
  costly. * * * There is nothing in the language of
  the statute or its legislative history to support
  the view that Congress intended to establish
  something akin to a `certiorari' policy for
  the Courts of Appeals whereby `important'
  cases would receive special appellate
  treatment. Thus, I believe that a party
  cannot avail himself of the statute unless he
  shows that the appeal

  would save him from the cost and delay of
  protracted and expensive litigation.
    "I have been shown nothing to indicate that
  this case is at all exceptional, except in
  that it involves an important legal

Likewise, in Milbert v. Bison Laboratories, supra, 260 F.2d at page 433, it is said that the statute "is to be used only in exceptional cases where an immediate appeal may avoid protracted and expensive litigation and is not intended to open the floodgates to a vast number of appeals from interlocutory orders in ordinary litigation." To same ...

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