Can a winner appeal?

Let’s say a party wins a judgment in the trial court, but along the way, the trial court makes findings unfavorable to the winning party. Can the winning party appeal?

That question came up in a recent opinion from the U.S. Fifth Circuit, In re Riverstone Resor, LLC (Azhar Chaudhary Law Firm, P.C. v. Ali), No. 23-20362 (5th Cir. Dec. 9, 2024). The Fifth Circuit’s answer in that case was “no” according to the general rule, though the court acknowedged a “handful of situations” where the answer might be “yes.”

The case involved a dispute between a person and his former lawyer, which found its way to bankruptcy court. The bankruptcy court found the lawyer’s testimony to be “mostly a lie” and in at least one instance “nonsensical.” But the bankruptcy court rendered judgment dismissing the claim against the lawyer on statute-of-limitations grounds. Everyone appealed to the district court, which affirmed the bankruptcy court’s judgment and entered a final judgment in the lawyer’s favor. After that, everyone appealed to the Fifth Circuit.

The Fifth Circuit dismissed the lawyer’s appeal on grounds that the lawyer and his law firm lacked standing to appeal. They had “won a take-nothing judgment—a ‘full victory’ for a defendant—after the bankruptcy court concluded that the statute of limitations had expired on any claims that Ali [the former client] had asserted.” Slip op. at 7. Since there was nothing in the judgment itself unfavorable to the lawyer, the lawyer could not appeal it:

“It is more than well-settled that only an aggrieved party may appeal a judgment.” Cooper Indus., Ltd. v. Nat’l Union Fire Ins. Co. of Pittsburg, 876 F.3d 119, 126 (5th Cir. 2017) (cleaned up). A party is generally not “aggrieved” when it wins a favorable judgment, even if the trial court made “subsidiary finding[s] or conclusion[s]” that were unfavorable to the party. Id. That’s because “appellate courts review judgments, not opinions.” United States v. Fletcher ex rel. Fletcher, 805 F.3d 596, 602 (5th Cir. 2015). A winning party “may not appeal for the sole purpose of seeking a more favorable opinion from the [trial] court.” Id. at 604. [Slip op. at 7.]

The Fifth Circuit described some exceptions to this general rule (none of which applied in the case before it):

• if the judgment itself contains prejudicial language on issues immaterial to the disposition of the case
• where collateral estoppel (issue preclusion) may harm the appellant in future proceeding
• where the appellant will suffer financial loss as a result of the judgment
  [Slip op. at 8.]

The Fifth Circuit refused to review dicta in the bankruptcy court’s reasons for judgment because it was not the court’s role “to nitpick a [bankruptcy] court’s order sentence-by-sentence.” Slip op. at 8, quoting Flight Options, L.L.C. v. Int’l Bhd. of Teamsters, Local 1108, 873 F.3d 540, 546 (6th Cir. 2017).

Comments

[MBC]

I'm surprised that the Court did not cite to Camreta v. Greene, 563 U.S. 692 (2011).