LOS ANGELES — The California Public Employees' Retirement System wants U.S. Bankruptcy Judge Meredith Jury to reconsider the oral ruling in which she denied without prejudice the pension fund's request that she certify a direct appeal to the U.S. Ninth Circuit Court of Appeals of San Bernardino's eligibility to be in bankruptcy.
CalPERS is appealing the city's ability to be a debtor under Chapter 9 of the Bankruptcy Code and to support the pension fund's ability to obtain discovery related to that question, according to court documents.
Jury granted San Bernardino the eligibility to be in bankruptcy on Aug. 28.
An appeal of a bankruptcy court order may be made to either the district court or the bankruptcy appellate panel, according to Joe DeAnda, a CalPERS spokesman. It can also be certified for direct appeal to the Ninth Circuit Court of Appeals, DeAnda said.
In her ruling, Jury said procedurally that CalPERS needs to obtain leave from the U.S. District Court to appeal what she described as "the interlocutory eligibility order." She said the Ninth Circuit only has jurisdiction on final decisions, not interlocutory, or non-final matters.
CalPERS cited a Ninth Circuit court decision in its 2008 ruling in General Electric Capital Corp. v. Future Media Productions. In that case, the appeals court said it has discretionary jurisdiction to hear appeals of non-final orders upon certification by the bankruptcy court.
"If this court denies CalPERS certification request despite the Ninth Circuit precedent provided herein, or does not enter an order by Nov. 16, CalPERS will be forced to file a prophylactic certification request with the district court in order to avoid any argument" that it did not file by the 60-day deadline after a ruling was made, argued the pension fund's attorneys led by Michael Lubic and Brett DeArmond Bisset of Los Angeles-based law firm K&L Gates, in court documents.
Jury said in her oral ruling made Oct. 29 that she didn't think the question was one that was "ripe" for the Ninth Circuit court of appeals to take.
If the district court grants leave, it will be with a "full picture of why they think or don't think the questions are significant to go to the Ninth Circuit," Jury said. "They might not grant leave."
She added that she thinks the questions of eligibility are "issues that need to be addressed by an appellate court" just before announcing she was denying the pension fund's motion without prejudice.
"We are, all of us floundering around out there trying to figure out what these words mean, and that it will be helpful for all cases in this state and probably in the country, if the issues get to the appellate courts," she said.
