Appeal from the United States District Court for the Northern District of Illinois, Eastern Division., Nos. 83 C 2640, 83 C 2641, 83 C 3015, 83 C 3016, 83 C 3017, 83 C 3021, (83 B 1933 through 83 B 1989) (83 A 499)-- John A. Nordberg, Judge.
Bauer, Wood, and Cudahy, Circuit Judges.*fn*
This appeal raises the novel issue whether community currency exchanges, which are engaged in the business of cashing checks and money orders for a fee and selling or issuing money orders, may be debtors under the Bankruptcy Code.
On February 10, 1983, fifty-seven currency exchange corporations filed voluntary petitions for reorganization under chapter 11 of the Bankruptcy Code. Thirty-three of these currency exchanges were located in Illinois. One week before the filing of these chapter 11 petitions, the thirty-three Illinois currency exchanges had been placed under administrative receiverships pursuant to the Illinois Community Currency Exchange Act, Ill. Rev. Stat. Ch. 17, §§ 4801-4852 (1981) (the "Act"), which regulates the operation of currency exchanges in Illinois. The Illinois Director of Financial Institutions (the "Director") also had instituted proceedings to liquidate the thirty-three exchanges.*fn1
After filing the chapter 11 petitions, the exchanges sought from the bankruptcy court an order requiring the Director's receiver to turn over the exchanges' property to the bankruptcy trustee. The exchanges' application was treated by the bankruptcy court as a complaint initiating an adversary proceeding. The Director sought and was granted leave to intervene in the adversary turnover proceedings and the chapter 11 proceedings. He then moved to dismiss the debtors' application for an order requiring his receiver to turn over the debtors' property and the debtors' chapter 11 petitions on the ground that the bankruptcy court lacked jurisdiction of the case. Both motions were denied. The bankruptcy court subsequently ordered the appointment of a bankruptcy trustee and ordered the Director's receiver to turn over the exchanges' assets to the trustee.
The Director filed separate notices of appeal to the district court from six bankruptcy court orders, and moved the district court for leave to appeal. The orders entered in the chapter 11 proceeding were (1) the order granting limited intervention rights to the Director; (2) the order denying the Director's motion to dismiss the chapter 11 petitions or, in the alternative, to abstain; and (3) the order appointing a bankruptcy trustee. The orders entered in the adversary turnover proceeding were (4) the order granting limited intervention rights to the Director; (5) the order denying the Director's motion to strike and dismiss the turnover proceedings; and (6) the order requiring the Director's receiver to turn over the exchanges' property to the bankruptcy trustee. The district court granted the Director's motion for leave to appeal, apparently assuming jurisdiction under 28 U.S.C. § 1334(b),*fn2 and consolidated the appeals.
The major issue on appeal to the district court was whether community currency exchanges are excluded from being debtors under section 109(b) (2) of the Bankruptcy Code. 11 U.S.C. § 109(b) (2). The district court held that they are not. It therefore rejected the Director's challenge to the bankruptcy court's jurisdiction, and affirmed all six orders. In re Cash Currency Exchange, Inc., 37 Bankr. 617 (N.D. Ill. 1984).
In its memorandum opinion and order, the district court suggested that its order might be appealed to this court (1) as a final order under the Bankruptcy Code; (2) as a final decision of the district court under 28 U.S.C. § 1291; (3) as a certified interlocutory appeal under 28 U.S.C. § 1292(b); (4) as a collateral order under the Cohen doctrine, Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 93 L. Ed. 1528, 69 S. Ct. 1221 (1949); or (5) as an interlocutory appeal under 28 U.S.C. § 1292(a) (2).
The parties apparently have assumed that this court has jurisdiction of this appeal; the jurisdictional issue has not been briefed by either party. Because it is our duty to determine whether we have jurisdiction of this case, Liberty Mutual Insurance Co. v. Wetzel, 424 U.S. 737, 47 L. Ed. 2d 435, 96 S. Ct. 1202 (1976); In re Bassak, 705 F.2d 234, 236 (7th Cir. 1983), we turn to an examination of this threshold issue.
Under the transitional provisions of the Bankruptcy Act of 1978, Pub.L. 95-598, tit. IV, § 405(c) (2), 92 Stat. 2685 (Nov. 6, 1978), which were in force when the Director appealed to the district court and to this court, "a court of appeals shall have jurisdiction of an appeal from a final judgment, order, or decree" entered by a district court in an appeal from a bankruptcy court. 28 U.S.C. § 1293(b). The district courts' jurisdiction of appeals from decisions of the bankruptcy courts is not so limited. Final decisions of the bankruptcy court are appealable as of right to the appropriate district court. 28 U.S.C. § 1334(a). But the district court also is authorized to exercise its discretion to entertain interlocutory appeals from the bankruptcy court. 28 U.S.C. § 1334(b).
This court and others have held that a district court's decision on a appeal from a bankruptcy court's interlocutory order generally is not a final order for purposes of further appellate review under section 1293(b).*fn3 In re Riggsby, 745 F.2d 1153, 1154 (7th Cir. 1984);*fn4 In re Comer, 716 F.2d 168 (3d Cir. 1983). And, a district court's decision on an appeal from a bankruptcy court's final order will be reviewed only if it also is final . Riggsby, 745 F.2d at 1155. Thus, an order by the district court remanding the case to the bankruptcy court for further significant proceedings will not be automatically and immediately appealable to this court, provided the order may be effectively reviewed on appeal from the bankruptcy court's "final final" decision. Id. at 1156.
With these basic principles in mind, we turn to an examination of the six orders appealed in this case. The orders entered by the bankruptcy court in the turnover proceeding (4-6) were, in our view, final orders. Although the orders allowing limited intervention by the Director and denying the Director's motion to dismiss the turnover proceeding were interlocutory, they became final and appealable as such with the entry of the order requiring the Director's receiver to turn over the debtors' property to the bankruptcy trustee. Because this order terminated the adversary proceeding, all three orders were appealable to the district court as final orders. The district court's affirmance of these orders also was a final decision, appealable to this court under section 1293(b). In re Tarnow, 749 F.2d 464, 464-65 (7th Cir. 1984).*fn5
The three orders entered in the context of the chapter 11 proceeding (1-3) stand on a different footing. The orders permitting limited intervention by the Director, denying his motion to dismiss the chapter 11 petitions, and appointing a bankruptcy trustee were interlocutory and reviewable only if the district court agreed to entertain the appeals. The affirmance of these orders by the district court did not alter their interlocutory character. If follows that this court does not have jurisdiction to review them under section 1293(b). The question remains whether they are reviewable under one of the special procedures for interlocutory appeals, several of which were suggested by the district court to be appropriate bases for our jurisdiction.
As we noted in Riggsby, a case in which "the district court rejects an argument that if accepted would terminate the proceeding is a 'natural' for appeal under 28 U.S.C. § 1292(b). . . ." The district court's rejection of the Director's contention that currency exchanges may not be debtors under the Bankruptcy Code falls squarely within this class of cases. If this contention has been accepted, the chapter 11 petitions would have been dismissed for lack of jurisdiction. The district court believed that its 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." The district court's "magic words," however, did not invoke the appropriate response on the part of the Director. The Director failed to ask us within ten days of entry of the district court's order whether we agreed that the appeal should be decided immediately. 28 U.S.C. § 1292(b). We therefore need not decide the question left unanswered in Riggsby : whether section 1292(b) applies to bankruptcy cases.
The district court also suggested its order might be appealable under the "collateral order" doctrine, Cohen, 337 U.S. 541, 93 L. Ed. 1528, 69 S. Ct. 1221, which permits orders that "are not final in the sense of disposing of the entire lawsuit before the district court, but are final in the sense of irrevocably deciding the rights of a party, to be appealed under 28 U.S.C. section 1291." In re UNR Industries, Inc., 725 F.2d 1111, 1117 (7th Cir. 1984). The doctrine applies to
that small class [of orders] which finally determine claims of right separable from, and collateral to, rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated.
Cohen, 337 U.S. at 546. More recently, the Supreme Court found that, in order to be immediately appealable, "the order must conclusively determine the disputed question, resolve an important issue completely separate from the merits of the action, and be effectively unreviewable on appeal from a final judgment." Coopers & Lybrand v. Livesay, 437 U.S. 463, 468, 57 L. Ed. 2d 351, 98 S. Ct. 2454 (1978). This court has interpreted the last requirement articulated in Coopers & Lybrand to mean that the order's consequences "must be irreversible by subsequent proceedings." In re UNR Industries, Inc., 725 F.2d at 1118 (citing In re Continental Investment Corp., 637 F.2d 1, 5 (1st Cir. 1980)). In other words, denial of immediate review will cause the appellant "irreparable harm." Id. at 1117.
Although the orders at issue may satisfy the first two requirements, we conclude they cannot meet the third. The denial of a motion to dismiss, the limitation on intervention, and the appointment of a bankruptcy trustee are actions which, if erroneous, may be reversed on appeal*fn6 from the approval of a final plan of reorganization.*fn7
Finally, the district court suggested that its order affirming the appointment of a bankruptcy trustee might be appealable under 28 U.S.C. § 1292(a) (2), which confers jurisdiction on the courts of appeals to entertain appeals from interlocutory orders "appointing receivers." Our research has revealed no cases in which an order appointing a bankruptcy trustee has been found to be appealable under section 1292(a) (2). In dicta, this court has stated that such an order is not appealable under that section. In re Licek Potato Chip Co., 599 F.2d 181, 184 n. 4 (7th Cir. 1979) (citing 7B MOORE'S FEDERAL PRACTICE P1292(a) (2) (2d ed. 1978); 2 COLLIER ON BANKRUPTCY P24.27 [2.1] at 762.1 n. 7 (14th ed. 1978)). We think it clear that section 1292(a) (2) refers only to "federal equity receivers," and not to bankruptcy trustees. 7B MOORE'S FEDERAL PRACTICE P1292(a) (2) (2d ed. 1985); 7-Pt.2 MOORE'S FEDERAL PRACTICE P66.02 (2d ed. 1985).
In conclusion, the three orders entered in the context of the chapter 11 proceeding are not now appealable to this court. We proceed to the merits of the Director's appeal from the turnover order.
Section 109 of the Bankruptcy Code, 11 U.S.C. § 109 (1982), provides that certain entities may not be debtors under the Code. Section 109(b) (2) provides that:
(b) A person may be a debtor under chapter 7 of this title only if such person is not--
(2) a domestic insurance company, bank, savings bank, cooperative bank, savings and loan association, building and loan association, homestead association, credit union, or industrial bank or similar institution which is an insured bank as defined in section 3(h) of the Federal Deposit Insurance Act (12 U.S.C. 1813(h)).
"Only a person that may be a debtor under chapter 7 of this title . . . may be a debtor under chapter 11 of this title." 11 U.S.C. § 109(d). A "person" is defined as an individual, a partnership, or a corporation. 11 U.S.C. § 101(33).
The Director argues that the Illinois exchanges, which provide financial services and are regulated by the state in a manner "substantially identical to those entities listed in section 109(b) (2)," cannot be debtors under chapter 11. Applying two well-established tests for determining whether an entity is prohibited from being a debtor under the Code, the state classification test and the independent classification test, see 2 KING, COLLIER ON BANKRUPTCY § 109.02 15th ed. 1985), the district ...