In re Pfetzer

(Bankr. E.D. Ky. Mar. 22, 2018)

The bankruptcy court addresses the issue of whether a motion to dismiss for lack of good faith under 11 U.S.C. § 1307(c) can save an otherwise untimely § 1325(a)(7) objection to confirmation of a Chapter 13 plan. The court holds that because § 1325(a)(7) requires the determination of the debtor’s good faith in filing the petition as part of the plan confirmation process, a motion to dismiss under § 1325(a)(7) cannot rely on an allegation of lack of good faith if the motion is filed after the deadline to object to confirmation. Opinion below.

Judge: Wise

Attorney for Debtor: Michael B. Baker

Attorney for Creditor: Finney Law Firm, LLC, Justin C. Walker

2018-03-22 – in re pfetzer

Author: Matt Lindblom

Owens v. Coffey (In re Coffey)

(Bankr. W.D. Ky. Mar. 1, 2018)

The bankruptcy court denies the debtor’s motion for judgment on the pleadings. The plaintiff commenced a state court action prior to the bankruptcy that asserted claims against the debtor, including fraud. The debtor argued that the plaintiff’s non-dischargeability claims were barred by res judicata, as the Chapter 13 plan had already been confirmed. The court notes that there was no express provision in the plan that provided the plaintiff’s claims were deemed dischargeable. Further, the debtor’s arguments as to the merits of the underlying claim should be asserted in the state court action and would not defeat the non-dischargeability claims at this stage. The court holds the adversary proceeding in abeyance so the state court action can proceed. Opinion below.

Judge: Stout

Attorney for Debtor: Joseph S. Elder, II

Attorney for Creditor: Willam R. Noelker

2018-03-01 – in re coffey

Author: Matt Lindblom

In re Lane

(Bankr. W.D. Ky. Feb. 5, 2018)

The bankruptcy court denies the creditors’ motion to dismiss the Chapter 13 case. The motion raised issues that could have been raised in an objection to confirmation of the plan. The confirmation order operates as res judicata of all issues which could have been raised at the confirmation hearing. Opinion below.

Judge: Lloyd

Attorneys for Debtor: Seiller Waterman LLC, Neil Charles Bordy

Creditor: Pro Se

2018-02-05 – in re lane

Author: Matt Lindblom

The Branham Corporation v. Boone County Utilities, LLC (In re Boone County Utilities, LLC)

(S.D. Ind. Jan. 22, 2018)

The district court affirms several orders of the bankruptcy court and remands for further proceedings with respect to sanctions. The plaintiff appealed orders and issues related to subject matter jurisdiction, summary judgment, plan and confirmation order interpretation, discovery, dismissal of a complaint, and sanctions against the plaintiff. Opinion below.

Judge: Young

Attorney for Plaintiff: Jacobson Hile, LLC; Michael W. Hile

Attorney for Debtor: Bator Law, LLC; John E. Bator

2018-01-22 – in re boone county utilities

Author: Matt Lindblom

Harper v. The Oversight Committee (In re Conco, Inc.)

(6th Cir. April 28, 2017)

The Sixth Circuit affirms the district court and the bankruptcy court, holding that the sale of certain equity interests in the debtor to third parties was prohibited by the confirmed Chapter 11 plan. While the plan was silent as to such sales, the bankruptcy court did not abuse its discretion when interpreting the plan and considering the intent of the parties based on the negotiations that resulted in the final confirmed plan. Opinion below.

Judge: Donald

Attorneys for Appellants: Frost Brown Todd, Edward Michael King, John Scott Egan, Cory J. Skolnick; Hahn & Hessen, Gilbert Backenroth; Kaplan & Partners, David S. Kaplan, Casey Leigh Hinkle

Attorneys for Appellee: Bingham Greenbaum Doll, John K. Bush, Claude R. Bowles, Jr., James R. Irving; Seiller Waterman, Neil C. Bordy, Glenn Alan Cohen, Keith James Larson

2017-04-28 – in re conco

District Court Opinion

Bankruptcy Court Opinion

Author: Matt Lindblom

In re Neace

(Bankr. E.D. Ky. Jan. 6, 2017)

The bankruptcy court overrules the creditor’s objection to confirmation of the Chapter 13 plan. The creditor argued its claim, secured by the debtors’ mobile home, should be increased by the cost of delivery and set-up of the home. The court holds that set-up and delivery costs may not be used as a means to increase the replacement value as a matter of law. Opinion below.

Judge: Wise

Attorney for Debtor: Daryle M. Ronning

Attorneys for Creditor: McBrayer, McGinnis, Leslie & Kirkland, Zachary A. Horn

2017-01-06-in-re-neace

Author: Matt Lindblom

In re Perkins

(Bankr. W.D. Ky. Dec. 22, 2016)

The bankruptcy court overrules the creditor’s objection and confirms the Chapter 12 plan. The creditor argued that the debtor was not a “family farmer,” and thus did not qualify for Chapter 12. The court finds that the debtor had sufficient income from the farming operation to satisfy the Code’s definition, which definition the court construes broadly. Further, the court finds the debtor’s debt level does not exceed the debt limitation for Chapter 12. The court looks only to the debtor’s schedules, rather than adding the scheduled debt to the debt reflected in the filed claims. Opinion below.

Judge: Lloyd

Attorney for Debtor: Sandra D. Freeburger

Attorneys for Creditor: Stites & Harbison PLLC, Brian H. Meldrum, Brian R. Pollock

2016-12-22-in-re-perkins

Author: Matt Lindblom

Korean Claimants v. Debtor’s Representatives (In re Settlement Facility Dow Corning Trust)

(6th Cir. Nov. 23, 2016)

The Sixth Circuit affirms the 2015 consent order specifying the manner in which certain provisions of the confirmed Chapter 11 plan would apply to a class of claim holders. The Korean Claimants objected, arguing that the district court lacked authority to enter the consent order and that the consent order was an impermissible modification of the distribution agreement. The court holds that the court had the requisite authority to enter the consent order and it merely clarified the distribution agreement rather than modified it. Opinion below.

Judge: Kethledge

Attorney for Claimants: Yeon Ho Kim

Attorneys for Debtor Entities: Deborah E. Greenspan, Jeffrey S. Trachtman, Ernest H Hornsby, Dianna Pendleton-Dominguez

2016-11-23-in-re-dow-corning

Author: Matt Lindblom

In re Mustafa

(Bankr. E.D. Ky. September 14, 2016)

Debtor obtained a personal loan from bank to buy a Mercedes at a car auction and represented to the loan officer that the car was for personal and family use. The day debtor received the loan proceeds he leased the car to his used car business, which then sold the car to debtor’s friend, an out of state resident. Debtor failed to satisfy the bank loan with the sales proceeds. Instead, his business used the proceeds to pay its debts. Also, the business never transferred title to the car to debtor’s friend in order to hide the fact that the car had been sold. Debtor continued to make a few loan payments to the bank, but eventually quit and filed Chapter 13, which is when the bank learned that the car had been sold. The bank filed a dischargeability action and the court found that debtor made material misrepresentations to obtain a consumer loan and never intended to use the car for personal use. Thus, the debt, including attorney’s fees, was nondischargeable pursuant to both §523(a)(2) and (a)(6). Also, debtor’s plan, in which he proposed to surrender the vehicle to the bank, was not confirmed and was found lacking in good faith since, among other things, the car was currently located out of state in a repair shop subject to a $10,000 mechanics lien. Opinion below.

Judge: Schaaf

Attorney for Debtor: Tom Bunch

Attorney for Creditor: Greg Pavey and Jessica Middendorf

Author: Robert Imperial

2016-09-14-in-re-mustafa

Harper v. Conco ESOP Trustees

(W.D. Ky. July 7, 2016)

The district court affirms the bankruptcy court’s order enjoining the transfer of certain equity interests in the reorganized chapter 11 debtor because it violated the terms of the confirmed plan. The court determines that the bankruptcy court interpreted rather than modified the plan and thus the district court reviews the appealed order for abuse of discretion. While the plan did not expressly prohibit the transfer of the equity interests, the facts surrounding the negotiation and confirmation of the plan clearly evidenced the interested parties’ intent to prohibit such transfer until a certain date. Opinion below.

Attorneys for Appellants: Kaplan & Partners, LLP, Casey L. Hinkle, David S. Kaplan; Keller Rohrback LLP, David S. Preminger; Frost Brown Todd LLC, Cory J. Skolnick, Edward M. King, John S. Egan; Hahn & Hessen LLP, Gilbert Backenroth, Jeffrey Zawadzki; Seiller Waterman, LLC, Neil Charles Bordy

Attorneys for ESOP Trustees: Stoll Keenon Ogden PLLC, Lea Pauley Goff, P. Douglas Barr

Attorneys for Oversight Committee: Bingham Greenebaum Doll LLP, Claude R. Bowles, Jr., James R. Irving, John W. Ames

2016-07-07 – harper v conco esop trustees

 

Author: Matt Lindblom