No Appellate Jurisdiction In Environmental Clean-Up Case When Trial Court Still Must Decide Who Gets Insurance Proceeds

Kerr-McGee Chemical and Lefton Iron & Metal were fighting out a 15-year dispute over the cost of cleaning up an environmentally contaminated industrial site. The first time the case was in the Seventh Circuit Court of Appeals, the court ruled that Kerr-McGee was entitled to the clean-up costs from Lefton.

After the case was remanded, the trial court ruled that Kerr-McGee should receive $9.5 million. Lefton was ordered to be liquidated to satisfy the judgment. Lefton disputed the amount because: (1) Kerr-McGee had not proven its expenses were reasonable, and (2) amounts paid to Kerr-McGee by its insurers should be deducted from the judgment. The trial court ruled that if Lefton wanted to fight about whether the insurance payments should be deducted, it should do so in a separate motion in Kerr-McGee’s proceedings to execute the judgment.

But instead of filing the motion, Lefton appealed. The first — and as it turned out, only — question for the appellate court was whether there was a final order from which to appeal. The appellate court ruled there was not a final order because the trial judge still had to decide whether the insurance payments should be deducted from Kerr-McGee’s judgment. This is how the court explained it:

[T]he district judge recognized that one question affecting damages was unresolved and announced his willingness to tackle it after the Leftons filed
an appropriate motion. Thus from the district judge’s perspective the litigation is not over, and the decision is not “final.”

So the appeal was dismissed because there was no appellate jurisdiction. But the court stated it would allow an appeal on the already-filed briefs after a final order from the trial court. Read the whole opinion, Kerr-McGee Chemical Co. v. Lefton Iron & Metal Co., No. 03-2991 (6/30/09), by clicking here.

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