In Re: Firestar Diamond, Inc.

Background

Rakhi Bhansali moved for permission to appeal a Bankruptcy Court order entered in an adversary proceeding against her husband. The Bankruptcy Court had granted in part Richard Levin’s motion to compel Bhansali to produce documents. Levin is identified in the opinion as the Chapter 11 trustee of Firestar Diamond, Inc., Fantasy, Inc., and Old AJ, Inc., formerly known as A. Jaffe, Inc.

Bhansali argued that the order authorized a “grossly improper fishing expedition” and compelled discovery beyond the limits of section 6220 of the New York Civil Practice Law and Rules.

Legal standard

The district court applied the standard used for permission to take an early appeal from a district court order. Under 28 U.S.C. §§ 158(a)(3) and 1292(b), permission is appropriate when the order presents a controlling legal question with substantial grounds for disagreement and an immediate appeal could materially advance the end of the litigation. The court described these circumstances as exceptional.

Ruling

The court held that Bhansali had not identified a pure legal question, much less one involving substantial grounds for disagreement. It also held that she had not shown that an appeal would speed the trial or shorten the litigation. According to the court, Bhansali was asking it to revisit a fact-specific discovery ruling by the Bankruptcy Court and cited no authority allowing an early appeal in those circumstances. The court also noted that she did not file a reply addressing the trustee’s arguments or providing supporting authority.

Judge Arun Subramanian denied Bhansali’s motion for permission to appeal. The Clerk of Court was directed to terminate the motion at ECF No. 3 and close the case.