Siragusa v. Collazo (In re Collazo)

(7th Cir. Apr. 5, 2016)

The Seventh Circuit affirms the decision of the bankruptcy court dismissing some of the creditors’ nondischargeability claims because the claims were based on alleged fraud occurring outside the applicable Illinois five-year limitations period. The court reverses the dismissal of one of the claims because it was not clear that the creditor had notice of the fraud to start the limitations period. The court also remands so that a money judgment can be entered, as the bankruptcy court’s concerns that it did not have jurisdiction to do so were addressed in the Supreme Court’s Wellness and Arkison decisions. Opinion below.

Judge: Posner

Attorney for Debtor: David Robert Herzog

Attorney for Creditors: Patrick Gerard Cooke

2016-04-05 – in re collazo

Author: Matt Lindblom

Golson-Dunlap v. HSBC Capital (USA), Inc. (In re Garrison)

(S.D. Ind. Feb. 5, 2016)

The district court grants the unopposed motion to withdraw the reference and the motion to dismiss the adversary proceeding with prejudice. The court discusses the standard for withdrawal motions, and finds that the standard is met here. The claims arise out of a contractual relationship outside the bankruptcy and would not be resolved through the claims resolution process. Thus, the bankruptcy court could not issue a final judgment in the matter absent the movant’s consent. Opinion below.

2016-02-05 – in re garrison

Author: Matt Lindblom

Wellness International Network, Ltd. v. Sharif

(U.S. Sup. Ct. May 26, 2015)

The Supreme Court holds that certain claims entitled to Article III adjudication (i.e. Stern claims) may be decided by bankruptcy judges when the parties knowingly and voluntarily consent to such adjudication. Such consent does not have to be express. Here, the creditor filed a non-dischargeability complaint that included a count requesting a declaratory judgment that a trust was the alter-ego of the debtor. The bankruptcy court entered judgment against the debtor on that count (as well as the non-dischargeability counts). The debtor’s answer conceded that the action was a core proceeding and requested judgment in his favor on all counts. The Supreme Court remands to the Seventh Circuit to decide whether the debtor gave the requisite knowing and voluntary consent to entry of the final judgment by the bankruptcy court. Opinion below.

2015-05-26 – wellness international network v sharif

Author: Matt Lindblom

Executive Benefits Insurance Agency v. Arkison

(U.S. Supreme Court, Issued June 9, 2014)

The U.S. Supreme Court holds that when a bankruptcy court is prohibited from entering a final judgment on certain claims under the Court’s prior Stern opinion, the bankruptcy court may still enter proposed findings of fact and conclusions of law to be reviewed de novo by the district court. This opinion gives some guidance to bankruptcy courts as to how to proceed when faced with a “Stern claim.” Opinion below.

2014-06-09 – executive benefits insurance agency v arkison