Atlantic City Electric Co. v. General Electric Co.
337 F.2d 844 (1964)
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Rule of Law:
An appellate court has discretion to deny an application for an interlocutory appeal under 28 U.S.C. § 1292(b), even if certified by the district court, if it concludes that granting the appeal would delay rather than materially advance the ultimate termination of the litigation.
Facts:
- Plaintiffs, who were customers of electricity, initiated legal action against several defendants.
- The plaintiffs alleged that they had incurred damages as a result of the defendants' actions.
- In their defense, the defendants contended that the plaintiffs had not actually suffered any financial loss.
- The defendants argued that the plaintiffs had mitigated any potential damages by passing on the increased costs to their own customers.
Procedural Posture:
- Plaintiffs sued defendants in federal district court.
- During pre-trial discovery, defendants served interrogatories on plaintiffs concerning a 'passing-on' defense.
- The plaintiffs objected to these interrogatories.
- The district court sustained the plaintiffs' objections, effectively precluding defendants from conducting discovery on their passing-on theory.
- The district court then certified its order for an interlocutory appeal under 28 U.S.C. § 1292(b), finding it involved a controlling question of law.
- Defendants, as appellants, filed an application for leave to appeal with the U.S. Court of Appeals.
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Issue:
Should an appellate court grant an interlocutory appeal under 28 U.S.C. § 1292(b) to review a pre-trial discovery order when the court determines that an immediate appeal would create an undue burden and would delay, rather than advance, the ultimate disposition of the case?
Opinions:
Majority - Per Curiam
No. An appellate court should not grant an interlocutory appeal when doing so would ultimately delay, rather than advance, the litigation. The court reasoned that applications for pre-trial appeals must be considered against the background of the entire case, not in isolation. Allowing discovery on the 'passing-on' defense could lead to a 'multitude of full scale rate cases' that would dwarf the existing pre-trial proceedings. The court concluded that the defendants' rights were not prejudiced, as they could raise the issue on appeal from a final judgment if one were entered against them. Therefore, denying the application serves the interest of judicial economy and prevents, rather than causes, delay.
Analysis:
This opinion emphasizes the discretionary nature of interlocutory appeals under 28 U.S.C. § 1292(b) and the strong federal policy against piecemeal litigation. It establishes that even when a district court certifies a 'controlling question of law,' the appellate court will independently assess whether an immediate appeal serves the ultimate goal of judicial efficiency. The decision demonstrates that appellate courts will weigh the potential for a pre-trial appeal to create burdensome and time-consuming procedural diversions against the benefit of resolving a legal issue early. This sets a precedent for denying such appeals where the issue can be effectively reviewed after a final judgment and where the interlocutory proceeding itself threatens to complicate and prolong the case.
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