5.10.2007

3d Circuit Notes Split Re Whether Filing of an Interlocutory Appeal under Section 16(a) of the FAA Deprives Trial Court of Jurisdiction to Proceed

Per Ehleiter v. Grapetree Shores, Inc., 482 F.3d 207 (Apr. 06, 2007):

There is a circuit split on the question of whether the filing of an interlocutory appeal pursuant to Section 16(a) of the FAA automatically deprives the trial court of jurisdiction to proceed until such time as the appeal is fully litigated or determined to be frivolous or forfeited. Compare McCauley v. Halliburton Energy Servs., Inc., 413 F.3d 1158, 1162-63 (10th Cir.2005) (automatic divestiture of trial court jurisdiction unless appeal is frivolous or forfeited); Blinco v. Green Tree Servicing, LLC, 366 F.3d 1249, 1253 (11th Cir.2004) (automatic divestiture of trial court jurisdiction unless appeal is frivolous); Bradford-Scott Data Corp. v. Physician Computer Network, Inc., 128 F.3d 504, 505 (7th Cir.1997) (endorsing automatic divestiture rule, reasoning that “[c]ontinuation of proceedings in the district court largely defeats the point of the appeal and creates a risk of inconsistent handling of the case by two tribunals”), with Motorola Credit Corp. v. Uzan, 388 F.3d 39, 53-54 (2d Cir.2004) (no automatic stay); Britton v. Co-op Banking Group, 916 F.2d 1405, 1412 (9th Cir.1990) (same). In our order granting GSI's motion to stay, we expressed our agreement with the majority rule of automatic divestiture where the Section 16(a) appeal is neither frivolous nor forfeited.

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