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MOAC Mall Holdings LLC v. Transform Holdco LLC

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Supreme Court of the United States
MOAC Mall Holdings LLC v. Transform Holdco LLC
Term: 2022
Important Dates
Argued: December 5, 2022
Decided: April 19, 2023
Outcome
Vacated and remanded
Vote
9-0
Majority
Ketanji Brown Jackson • Chief Justice John Roberts • Clarence Thomas • Samuel Alito • Sonia Sotomayor • Elena Kagan • Neil Gorsuch • Brett Kavanaugh • Amy Coney Barrett

MOAC Mall Holdings LLC v. Transform Holdco LLC is a case that was decided by the Supreme Court of the United States on April 19, 2023, during the court's October 2022-2023 term. The case was argued before the court on December 5, 2022. The court vacated and remanded the decision of the United States Court of Appeals for the 2nd Circuit in a 9-0 ruling, holding that Bankruptcy Code Section 363(m) does not limit jurisdiction. Justice Ketanji Brown Jackson delivered the unanimous opinion of the court. [1] Click here for more information about the ruling.

HIGHLIGHTS
  • The case: In 2019, Sears sold its assets to Transform Holdco LLC. These assets included a lease for a space in the Mall of America in Minneapolis, with the permission of the U.S. Bankruptcy Court for the Southern District of New York.[2] MOAC Mall Holdings LLC petitioned the United States District Court for the Southern District of New York to appeal the bankruptcy court’s order but was dismissed. MOAC Mall Holdings LLC then appealed to the United States Court of Appeals for the Second Circuit which affirmed the district court’s decision.[3][4] Click here to learn more about the case's background.
  • The issue: The case concerned Section 363(m) of the U.S. Bankruptcy Code and whether it limits appellate courts' jurisdiction over certain cases that involve a sale order.
  • The question presented: "Whether Bankruptcy Code Section 363(m) limits the appellate courts’ jurisdiction over any sale order or order deemed 'integral' to a sale order, such that it is not subject to waiver, and even when a remedy could be fashioned that does not affect the validity of the sale."[5]
  • The outcome: The U.S. Supreme Court held that Bankruptcy Code Section 363(m) provision is not jurisdictional and that the case was not moot.[1]


    • The case came on a writ of certiorari to the United States Court of Appeals for the 2nd Circuit. To review the lower court's opinion, click here.

    Timeline

    The following timeline details key events in this case:

    • April 19, 2023: The U.S. Supreme Court vacated and remanded the decision of the U.S. Court of Appeals for the 2nd Circuit’s ruling.
    • December 5, 2022: The U.S. Supreme Court heard oral argument.
    • June 27, 2022: The U.S. Supreme Court agreed to hear the case.
    • March 17, 2022: Petitioner MOAC Mall Holdings LLC appealed to the U.S. Supreme Court.
    • December 17, 2021: The United States Court of Appeals for the 2nd Circuit affirmed the district court's dismissal of MOAC Mall Holdings' appeal.

    Background

    In 2019, the U.S. Bankruptcy Court for the Southern District of New York allowed Sears to sell its assets to Transform Holdco LLC. These assets included a lease for a space in the Mall of America in Minneapolis.[2] MOAC Mall Holdings LLC, which owns the mall, petitioned the United States District Court for the Southern District of New York to appeal the bankruptcy court’s order to assign the lease to Transform. However, MOAC Mall Holdings LLC did not receive a stay for the lease assignment from the bankruptcy court, which caused the district court to dismiss the appeal.[3][4]

    MOAC Mall Holdings LLC then appealed to the United States Court of Appeals for the Second Circuit which affirmed the district court’s decision.[3][4] The Second Circuit cited 11 U.S.C. § 363, stating that the statute:[6]

    “ creates a rule of statutory mootness . . . which bars appellate review of any sale authorized by 11 U.S.C. § 363(b) . . . so long as the sale was made to a good-faith purchaser and was not stayed pending appeal.[7] ”

    Question presented

    The petitioner presented the following question to the court:[5]

    Question presented:
    “ Whether Bankruptcy Code Section 363(m) limits the appellate courts’ jurisdiction over any sale order or order deemed “integral” to a sale order, such that it is not subject to waiver, and even when a remedy could be fashioned that does not affect the validity of the sale.[7] ”

    Oral argument

    Audio

    Audio of oral argument:[8]




    Transcript

    Transcript of oral argument:[9]

    Outcome

    In a 9-0 opinion, the court vacated and remanded the judgment of the United States Court of Appeals for the 2nd Circuit, holding that Bankruptcy Code Section 363(m) provision is not jurisdictional and that the case was not moot. Justice Ketanji Brown Jackson delivered the opinion of the court.[10]

    Opinion

    In the court's majority opinion, Justice Ketanji Brown Jackson wrote:[10]

    “ Procedure 805 was understood to be jurisdictional because some appellate courts relied upon it to dismiss appeals that challenged the validity of a sale, without a consideration of the merits. Transform says that Congress transplanted Rule 805 wholesale into §363(m). But this argument fails at the gate: every lower court case Transform cites for support predates §363(m)’s 1978 enactment, and thus long predates the Court’s modern efforts on jurisdictional nomenclature. The Court routinely rejects such arguments, and does so here.[7] ”
    —Justice Ketanji Brown Jackson


    Text of the opinion

    Read the full opinion here.

    October term 2022-2023

    See also: Supreme Court cases, October term 2022-2023

    The Supreme Court began hearing cases for the term on October 3, 2022. The court's yearly term begins on the first Monday in October and lasts until the first Monday in October the following year. The court generally releases the majority of its decisions in mid-June.[11]


    See also

    External links

    Footnotes

    1. ↑ 1.0 1.1 U.S. Supreme Court, "MOAC Mall Holdings v. Transform Holdco LLC, decided April 19, 2023
    2. ↑ 2.0 2.1 “Supreme Court, "MOAC Mall Holdings LLC, Petitioner V. Transform Holdco LLC And Sears Holdings Corporation," accessed November 8, 2022
    3. ↑ 3.0 3.1 3.2 “SCOTUSblog,” "The independent state legislature theory and more on jurisdiction," accessed November 10, 2022
    4. ↑ 4.0 4.1 4.2 “Oyez,” "MOAC Mall Holdings LLC v. Transform Holdco LLC," accessed November 10, 2022
    5. ↑ 5.0 5.1 U.S. Supreme Court, "MOAC Mall Holdings v. Transform Holdco LLC - Petition for a Writ of Certiorari," March 17, 2022
    6. ↑ Casetext, "11 U.S.C. § 363," accessed November 10, 2022
    7. ↑ 7.0 7.1 7.2 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
    8. ↑ Supreme Court of the United States, "Oral Argument - Audio," argued December 5, 2022
    9. ↑ Supreme Court of the United States, "Oral Argument - Transcript," argued December 5, 2022
    10. ↑ 10.0 10.1 Cite error: Invalid <ref> tag; no text was provided for refs named opinion
    11. ↑ SupremeCourt.gov, "The Supreme Court at Work: The Term and Caseload," accessed January 24, 2022
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