KENNETH D. BELL, District Judge.
This appeal stems from an adversarial bankruptcy proceeding between Ace, a former floor plan lender for used car dealerships, and McCoy Motors, LLC, Misty McCoy, and McCoy (collectively, "McCoy Defendants"). Ace claims that the McCoy Defendants owe it more than $1,000,000. This adversary proceeding began in the Bankruptcy Court on June 18, 2018 and remains pending in the District Court today with unfortunately little to no progress towards resolution.
McCoy appeals the order of the Bankruptcy Court (Bnk. Doc. No. 130)
(Bnk. Doc. No. 127; Doc. No. 1-1). The day after the Bankruptcy Court's order was filed, McCoy filed a motion to reconsider. (Bnk. Doc. No. 128). The Bankruptcy Court denied McCoy's motion to reconsider because the motion did "not demonstrate any grounds to reconsider under Federal Rule of Bankruptcy Procedure 9024 or Federal Rule of Civil Procedure 60." (Bnk. Doc. No. 130; Doc. No. 1-2). McCoy filed this appeal on December 14, 2018, using a standard check-box notice of appeal form. (Doc. No. 1)
This Court may exercise jurisdiction only over final orders, 28 U.S.C. § 1291 (2012), and certain interlocutory and collateral orders, 28 U.S.C. § 1292 (2012); Fed. R. Civ. P. 54(b); Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 545-46 (1949). The order McCoy seeks to appeal is neither a final order nor an appealable interlocutory or collateral order. Accordingly, the Court will dismiss the appeal for lack of jurisdiction.
Any "final judgment, order, or decree of a bankruptcy judge" may be appealed. 28 U.S.C. § 158(a), Fed. R. Bankr. P. 8001(a) (district courts from bankruptcy courts); 28 U.S.C. §§ 158(d), 1291 (circuit courts from district courts). Generally, a case in federal district court culminates in a final decision when "a ruling `by which a district court disassociates itself from a case'" is entered. Bullard v. Blue Hills Bank, 135 S.Ct. 1686, 1691 (2015)(alteration in original) (quoting Swint v. Chambers Cty. Comm'n, 514 U.S. 35, 42 (1995)). However, "[t]he rules are different in bankruptcy. A bankruptcy case involves `an aggregation of individual controversies,' many of which would exist as stand-alone lawsuits but for the bankrupt status of the debtor." Id. at 1692 (quoting 1 Collier on Bankruptcy ¶ 5.08 (16th ed. 2014)). Thus, the "concept of finality in bankruptcy cases `has traditionally been applied in a more pragmatic and less technical way. . . than in other situations.'" In re Computer Learning Ctrs., Inc., 407 F.3d 656, 660 (4th Cir. 2005) (quoting A.H. Robins Co. v. Piccinin, 788 F.2d 994, 1009 (4th Cir. 1986)). As a guiding principal, "Congress has long provided that orders in bankruptcy cases may be immediately appealed if they finally dispose of discrete disputes within the larger case." Bullard, 135 S. Ct. at 1692.
Numerous courts have held generally that a bankruptcy court's discovery orders lack finality and are interlocutory for the purposes of § 158(a). See, e.g., In re Tullius, 500 F. App'x 286, 289 (5th Cir. 2012) ("Notwithstanding this more flexible approach to finality in bankruptcy appeals, federal courts have concluded overwhelmingly that a bankruptcy court's discovery orders are interlocutory decisions from which an appeal to the district court does not lie as a matter of right."); Coleman v. Simpson (In re Coleman Craten, LLC), 15 Fed. App'x 184 (table), 2001 WL 987034 (4th Cir. 2001) (denying the district court's order denying party's motion for leave to appeal the bankruptcy court's order granting in part and denying in part the trustees' motion to compel); Vance v. Lester (In re Vance), 165 F.3d 34 (table), 1998 WL 783728, at *1 (7th Cir. 1998) (noting that a bankruptcy court's discovery orders are interlocutory); In re Jeannette Corp., 832 F.2d 43, 46 (3d Cir. 1987) ("In civil litigation, discovery orders are, with rare exception, non-appealable. A similar approach applies in bankruptcy cases.") (citations omitted); W.S. Badcock v. Corp. v. Beaman, No. 4:14-CV-169-BO, 2015 WL 575422, at *2 (E.D.N.C. Feb. 11, 2015) (noting that bankruptcy discovery orders are interlocutory).
Outside the context of bankruptcy court, the Supreme Court has held "that one to whom a subpoena is directed may not appeal the denial of a motion to quash that subpoena but must either obey its commands or refuse to do so and contest the validity of the subpoena if he is subsequently cited for contempt on account of his failure to obey." United States v. Ryan, 402 U.S. 530, 532 (1971) (citing Cobbledick v. United States, 309 U.S. 323 (1940)). Similarly, the Fourth Circuit has held that "[o]rders enforcing subpoenas issued in connection with civil and criminal actions, or with grand jury proceedings, are normally not considered final. To obtain immediate review of such a district court enforcement order, the party to whom it is issued must defy it so that a contempt order, which is considered final, is entered against him." Reich v. Nat'l Eng'g & Contracting Co., 13 F.3d 93, 95 (4th Cir. 1993) (citations omitted); see also Mwabira-Simera v. Edmondson, 485 Fed. Appx. 631 (4th Cir. 2012) (dismissing appeal of district court's order denying motion to quash subpoenas as interlocutory).
Moreover, several courts have held that bankruptcy court orders denying motions to quash subpoenas are interlocutory and not subject to immediate appeal. See In re Yanik, 8 F.3d 34 (table) (9th Cir. 1993) (holding that an order granting a motion to quash a subpoena was an interlocutory order and not appealable as of right); Decker v. Scott, No. 5:19-cv-9, 2019 WL 4491332, at *2 (Sept. 18, 2019) ("Finding that the bankruptcy court's order denying [plaintiff's] motion to quash is not a final order as required for the court to assert jurisdiction pursuant to 28 U.S.C. § 158(a), the court will dismiss the appeal for lack of subject-matter jurisdiction."); In re Santiago, No. 10-17135, 2011 WL 1257209 (N.D. Ohio March 31, 2011) (holding the Bankruptcy Court's decision on a motion to quash a subpoena is an interlocutory order not appealable by right); Countrywide Home Loans v. Office of the U.S. Trustee, No. 08-617, 2008 WL 2388285, at *3-4 (W.D. Pa. June 11, 2008) (finding that a bankruptcy court's order denying in part Countrywide's objections and motion to quash was not a final order).
The Bankruptcy Court's order in this case denied McCoy's motion to quash Ace's subpoenas, and thus allowed discovery to proceed. Consequently, the Court finds that it lacks jurisdiction to hear McCoy's appeal of the Bankruptcy Court's order on a discovery dispute.
The Court further notes that an interlocutory appeal is not appropriate in this case. McCoy did not seek leave to appeal the Bankruptcy Court's interlocutory order pursuant to § 158(a)(3). Moreover, the appeal does not meet the three-factor test of 28 U.S.C. § 1292, which governs appeals of interlocutory bankruptcy orders. See Atl. Textile Grp., Inc. v. Neal, 191 B.R. 652, 653 (E.D. Va. 1996); see also W.S. Badcock Corp., No. 4:14-cv-169-BO, 2015 WL 575422, at *2 ("[A]ppeal from an interlocutory order is appropriate when (1) the order involves a controlling question of law; (2) there is substantial ground for a difference of opinion; and (3) allowing an immediate appeal would materially advance the litigation."). Nor does McCoy's appeal meet the prerequisites of asserting jurisdiction under the collateral order doctrine. Joseph v. Lindsey (In re Lindsey), 212 B.R. 373, 375 (B.A.P. 10th 1997)(noting that because the appellant could obtain effective review later, the collateral order doctrine standard was not met).
Ace's counsel asserts that McCoy's appeal from the Bankruptcy Court's order is frivolous and requests this Court award him damages and costs. Federal Rule of Bankruptcy Procedure 8020 (Frivolous Appeal and Other Misconduct) states that "[i]f the district court or BAP determines that an appeal is frivolous, it may, after a separately filed motion or notice from the court and reasonable opportunity to respond, award just damages and single or double costs to the appellee." Fed. R. Bank. P. 8020.
While this Court agrees with Ace that McCoy's appeal was frivolous and an attempt to delay the Bankruptcy proceedings, Ace's request for damages and costs is denied as not being in "a separately filed motion." See, e.g., In re Kyle, 317 B.R. 390, 395 (9th Cir. 2004) ("To the extent Federal Rule of Bankruptcy Procedure 8020 applies, the requests are rejected as not being in `a separately filed motion' as required by that rule."); In re Meabon, No. 3:15-cv-0398-RJC, 2017 WL 374921 (W.D.N.C. Jan. 25, 2017) (ruling on a separately filed motion for damages and costs for a frivolous appeal under Rule 8020); LeLiever v. Ward, No. 3:13-cv-204-GCM, 2013 WL 1891289 (W.D.N.C. May 6, 2013) (ruling on a separately filed motion for damages and costs for a frivolous appeal under Rule 8020); In re Parsons, 272 B.R. 735 (D. Colo. 2001) ("Kennedy did not file a separate motion as required by rule 8020, but rather included his rule 8020 for damages and costs in response brief.").
Ace's motion for damages and costs is denied without prejudice. If Ace chooses to file a separate motion for damages and costs under Rule 8020, this Court asks that counsel include the amount of attorney's fees and any other costs related to this appeal.
It is hereby ordered that Ace's Motion to Dismiss (Doc. No. 2) be