UNITED STATES v. BOARD OF MANAGERS OF WALKER TOWER CONDOMINIUM (2021)

United States Court of Appeals, Ninth Circuit.2021-07-22No. No. 20-55781

Summary · law.co

Holding. The appellate court vacated the district court's order enforcing the consent judgment and dismissed the appeal as moot because the property sale had been completed and no effective relief could be granted.

The United States pursued a civil forfeiture action against a condominium unit at Walker Tower in New York. The condominium's board agreed to surrender all rights to the property through a consent judgment but later attempted to exercise a right of first refusal under the building's bylaws when the government moved to sell the unit to a third party. The district court ruled that the consent judgment eliminated the board's right of first refusal and denied the board's request to pause the order.

The board appealed after the government completed the sale to a third party. The appellate court found the case moot because the sale had already been finalized, leaving no practical remedy available to the board. Even if the court had determined that the consent judgment did not extinguish the right of first refusal, the board could not have exercised that right since the property was no longer available for purchase. The board acknowledged that any remaining claims would need to be pursued in state court.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether an appeal is moot when the underlying transaction has been completed
Whether a right of first refusal survives a consent judgment in a forfeiture action
Proper remedy when an appeal becomes moot before appellate review is completed

Procedural posture

The board appealed the district court's order denying its request to stay enforcement of a consent judgment and denying its claimed right of first refusal after the government had already sold the forfeited property to a third party.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

MEMORANDUM **

The United States initiated this civil forfeiture action against a Walker Tower condominium located in New York, New York. The Board of the Walker Tower association entered a consent judgment with the government, agreeing to surrender “all right, title, and interest” in the property. When the government sought to sell the property to a third party, the Board attempted to invoke its right of first refusal (“ROFR”) as provided by the condominiums bylaws.

After the United States moved to enforce the consent judgment, the district court held that the Board had forfeited its ROFR. The district court denied the Boards request to stay its order. The Board did not request a stay before this court. The government proceeded to sell the property to a third party. The Board appealed. Having completed the sale, the United States now argues the appeal is moot. We agree.

Article III jurisdiction must exist “at all stages of review, not merely at the time the complaint is filed.” Vegas Diamond Props., LLC v. FDIC, 669 F.3d 933, 936 (9th Cir. 2012) (simplified). And jurisdiction is lost “if no present controversy exists as to which an appellate court can grant effective relief.” Id. That is the case here. Even if the consent judgment did not extinguish its ROFR, the Board would not be able to exercise that right because the sale has already occurred. See In Def. of Animals v. U.S. Dept of Interior, 648 F.3d 1012, 1013 (9th Cir. 2011) (per curiam) (appeal to prevent roundup of wild horses moot where roundup had already been conducted).

The Board argues that the appeal is not moot because there are still potential avenues for relief. But before the district court, the Board moved only for a declaration that its ROFR survived the consent judgment and for an order directing the government to close the sale with the Boards designee. The sale is complete, however, and the harm to the Board cannot be “undone” by granting the Boards requested relief. Am. Horse Prot. Assn, Inc. v. Watt, 679 F.2d 150, 151 (9th Cir. 1982) (per curiam). As the Board conceded, any relief must now be sought in state court. This appeal is therefore moot.

When an appeal becomes moot, our “ordinary practice” is to vacate the order or judgment being appealed. Lewis v. Continental Bank Corp., 494 U.S. 472, 482, 110 S.Ct. 1249, 108 L.Ed.2d 400 (1990); see United States v. Munsingwear, Inc., 340 U.S. 36, 40, 71 S.Ct. 104, 95 L.Ed. 36 (1950) (“When that procedure is followed, the rights of all parties are preserved[.]”). Accordingly, we VACATE the district courts order granting the governments motion to enforce the consent judgment and DISMISS the appeal.

FOOTNOTES

. We also grant the Boards unopposed motion for judicial notice (Dkt. No. 40), and the governments motion to file a late response to the Boards motion (Dkt. No. 45).