By Katherine A. Grosh
Partner, Beermann Pritikin Mirabelli Swerdlove LLP
In P.H. Glatfelter Co. v. Windward Prospects Ltd., 847 F.3d 452 (7th Cir. 2017), the Seventh Circuit addressed three total appeals—two taken
by P.H. Glatfelter Co. (Glatfelter) arising out of discovery-related orders and
one cross-appeal taken by non-party subpoena respondent Windward Prospects,
who sought costs and fees from Glatfelter under Federal Rule of Civil Procedure
37—all three of which the Seventh Circuit dismissed for lack of jurisdiction.
underlying case involved an ongoing multi-party environmental cleanup being
performed on the Lower Fox River in Wisconsin pursuant to the
Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). Under CERCLA, the parties responsible
for creating the hazard and potentially responsible parties (PRPs) may be
liable for the full costs of remediation. Glatfelter,
847 F.3d at 453-54.
Paper manufacturer Appvion,
Inc. (Appvion), a PRP, sued other PRPs, including Glatfelter, in the Eastern
District of Wisconsin, to recover the cleanup costs it incurred and to require
other PRPs to pay for future remedial work. Id.
at 454. Glatfelter sought discovery
from Windward, an English entity conducting Appvion’s defense
of the CERCLA claims and managing its cleanup operations, relating to Appvion's
costs and possible offsets
from insurance, settlements or indemnification payments in connection with the
underlying cost recovery action. Id.
When Glatfelter could not obtain
compliance with the subpoena it attempted to issue to Windward, it instituted an
ancillary proceeding in the District of Massachusetts. Id. at 455. In addition to seeking an order compelling Windward to
respond to the subpoena, Glatfelter sought to transfer the case to the Eastern
District of Wisconsin, where the main cost recovery action was pending. Id.
The district court transferred the
case, and the same judge presiding over the recovery action in the Eastern
District of Wisconsin denied the motion to compel, concluding that the court
lacked personal jurisdiction over Windward and that Glatfelter had not
established that the documents it sought were not already subject to production
by Appvion. Id. Glatfelter filed a
motion to reconsider, which the court also denied.
Glatfelter appealed. Id.
The Seventh Circuit’s analysis began
by reciting the general rule that pretrial discovery orders are not final in
terms of winding up the underlying lawsuit, as well as the exception to that
rule under the collateral order doctrine, where an order “conclusively
determine[s] the disputed question, resolve[s] an important issue completely
separate from the merits of the action, and [is] effectively unreviewable on
appeal from a final judgment.” Id. at
455 (quoting Coopers & Lybrand v. Livesay, 437 U.S. 463, 468 (1978).
Examining opinions from other
circuits that had directly considered the issue, the Seventh Circuit held that where
a district court enters an order in an ancillary action, and that district
court is located in the same circuit as the district court handling the main
action, the order in the ancillary action is interlocutory and not immediately
According to the Seventh Circuit,
the problem for Glatfelter was that the ancillary action was transferred from
the District of Massachusetts to the Eastern District of Wisconsin prior to the
appeal. In the Seventh Circuit, pretrial discovery orders are appealable “only
where they were issued by a district court in an ancillary proceeding and
said district court was not within the jurisdiction of the circuit court having
appellate jurisdiction to review the final adjudication of the main action.” Id. at 456 (emphasis original).
the three appeals were dismissed for lack of jurisdiction because the ancillary
action was in the same district court presiding over the main action (the cost
recovery action), and the denial of Glatfelter’s motions would be reviewable on
appeal from the final judgment in the main action. Id. at 459.
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