Mere Involvement of a Foreign Government Does Not Fulfill the “Collateral Order” Criteria for an Interlocutory Appeal

September 05, 2015 8:07 PM | Anonymous member (Administrator)

Under the “collateral order” doctrine, a non-final district court order may be appealable despite the “final order” requirement of 28 U.S.C. § 1291, if certain criteria are met. In general, the order must be conclusive; it must resolve an important issue apart from the merits; and it must be effectively unreviewable on an appeal in the underlying action. 

In United States of America v. Sinovel Wind Group Co., Ltd.,  2015 U.S. App. LEXIS 12694 (7th Cir. July 23, 2015), the Seventh Circuit Court of Appeals rejected application of the collateral order doctrine and found that an appeal by a partially owned Chinese corporation lacked jurisdiction. The court also rejected use of a mandamus to obtain appellate review.

In June of 2013, the United States Department of Justice attempted to serve Sinovel Wind Group Company (“Sinovel”), a Chinese corporation with 18% government ownership, with a criminal summons, by serving its wholly owned U.S. subsidiary, Sinovel USA, in Texas. The summons revealed that Sinovel had been indicted in the Western District of Wisconsin for criminal copyright infringement and trade secret theft involving computer software. 

Sinovel specially appeared in district court to file a motion to quash service of the summons, complaint and indictment for lack of personal jurisdiction under applicable federal criminal rules. It contended that service on Sinovel USA was not the equivalent to service on Sinovel itself.  Id. at *4. The district court found that Sinovel USA was the alter ego of Sinovel and denied the motion. Id. Sinovel filed a notice of appeal in September of 2014. It also filed a petition for writ of mandamus directly with the Seventh Circuit. 

In an opinion authored by Chief Judge Diane P. Wood, the Seventh Circuit dismissed the appeal and denied the writ of mandamus. She first addressed appealability, noting that the order appealed from was not “final” for purposes of 28 U.S.C. § 1291. After outlining the parameters of the collateral order doctrine, she turned to Sinovel’s arguments for why the district court order should be treated as a collateral order.

Sinovel basically argued the importance of the district court ruling based upon the Chinese government’s partial ownership. It further contended that the order was practically unreviewable, at least until conclusion of the criminal proceeding, and that prosecution of the case could imperil foreign relations.

Chief Judge Wood pointed out, however, that litigants routinely raise personal-jurisdiction objections that are not reviewable until after the merits of the litigation have been resolved. She further noted that special rights for foreign-government-owned corporations are not triggered under the Foreign Sovereign Immunities Act unless the foreign government owns a majority interest.In addition, she observed that the fact that the Executive Branch, through the U.S. Department of Justice, had made the decision to prosecute the case constituted adequate consideration of the impact on foreign relations.

Ultimately, Chief Judge Wood found that the district court’s jurisdiction decision was not unreviewable after final judgment, and that the appeal therefore lacked jurisdiction. 

Some of these considerations overlapped with Wood’s evaluation of the petition for the writ of mandamus. She noted, for example, that such writs do not issue unless the petitioner has no other adequate remedy and has demonstrated a “clear and indisputable” right to the relief sought. Wood ultimately found that no compelling reason for immediate action existed here and that Sinovel would have an adequate remedy in an appeal after final judgment.

Accordingly, the court dismissed the appeal and denied the petition for a writ of mandamus.

Recommended Citation: Don R. Sampen, Mere Involvement of a Foreign Government Does Not Fulfill the “Collateral Order” Criteria for an Interlocutory Appeal, The Brief (September 5, 2015),

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