Opinions Not Selected for Publication
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Opinions Not Selected for Publication*:
(Opinions contained on this
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attorneys and practitioners of the Bankruptcy Court for the District of Colorado)
CST GROUP, INC.; Case No. 13-11894 HRT; Order entered May 22, 2013 (Relief from Stay under §§362(d)(1) & (d)(2); Use of Cash Collateral under § 363; Adequate Protection under § 361).
The Debtor purchased the assets of a pool hall and sports bar business from the Creditor. Debtor made a cash down payment and the Creditor took a promissory note for the balance of the purchase price. Debtor granted Creditor a blanket lien against all of its assets to secure repayment of the note. The Debtor defaulted and Creditor commenced legal proceedings in state court. Thereafter, Debtor filed its petition under chapter 11 in order to reorganize its business. The Creditor filed its motion for relief from stay and a separate motion to prohibit use of cash collateral only 31 days following the petition date. The Debtor's post-petition operations were unprofitable and, in just two months, over $25,000 of new unpaid tax debt had resulted from the Debtor's operations. Under the circumstances, even at a very early point in the Debtor's reorganization efforts, the Court could not find a likelihood of successful reorganization or that the Creditor's interest in its collateral was adequately protected. The Court granted the Creditor's motions to lift the stay and to prohibit use of cash collateral.
Posted: 5/28/2013 9:17:36 AM
In re Carter, Case No. 11-13475 ABC; (trustee's objection to claim under § 502(d))
The Court denied Chapter 7 trustee's objection to claim under § 502(d) because trustee had not obtained a judicial determination of the avoidability of the transfer from the debtor to the claimant.
Posted: 4/30/2013 3:33:06 PM
In re Castro, Case No. 11-17771 ABC; (court denied motion to open asset case to list previously unscheduled creditor)
In re Castro, Case No. 11-17771 ABC; 11 U.S.C. §§ 350(b), 523(a)(3). The Court denied debtors' motion to reopen their Chapter 7 "asset" case to add a creditor. Reopening to add a previously unscheduled creditor in this situation will not result in discharge of the debt unless creditor had notice or actual knowledge of the case in time to file a timely proof of claim.
Posted: 4/26/2013 12:20:03 PM
Manheim Automotive Financial Services, Inc. v. Oltman; Case No. 07-1753 HRT; Order entered February 1, 2013 (waiver of attorney work product).
Plaintiff's attorney employed an investigator to locate and interview two former employees of the Plaintiff. Plaintiff used information developed by its attorney's investigator to supplement its responses to Defendant's interrogatories. In addition, during the deposition of Plaintiff's designated representative, she used information contained in the investigator's report to respond to questions from Defendant's counsel. Defendant demanded turnover of the report produced by the investigator employed by Plaintiff's counsel and counsel asserted work product privilege. Defendant moved to compel turnover on the grounds that counsel had waived privilege as to the subject matter of her investigator's reports by making partial disclosure of information contained in the reports. The Court held that partial disclosure, without more, is insufficient to trigger a subject matter waiver of attorney work product. In addition to partial disclosure, the cases require the presence of an attempt to gain an advantage through the disclosure. Here, the Plaintiff did no more than use its attorney's work product to satisfy its discovery obligations to the Defendant.
Posted: 2/4/2013 10:07:22 AM
In re Riviera Drilling & Exploration Co., Case No. 10-11902 HRT; Order entered December 19, 2012 (300-day deadline for Chapter 11 plan filing for small businesses under § 1121(e)(2); Confirmation standards under §§ 1129(a) and (b)).
The Debtor initially filed a proposed Chapter 11 plan and disclosure statement within the 300-day period applicable to small business debtors under 11 U.S.C. § 1121(e)(2). After a creditor moved to convert or dismiss, the Court denied the motion and appointed a Chapter 11 Trustee. Over a year later, the Trustee moved to convert, and the creditor proposed its own plan and disclosure statement, now well outside the 300-day period. The Court asked the parties to brief whether the 300-day period applied only to the debtor, or to any party seeking to confirm a plan.
The Court held that under the facts of this case, the reasoning applied by the court in In re Florida Coastal Airlines, Inc., 361 B.R. 286 (Bankr. S.D. Fla. 2007) was persuasive, and thus the Court declined to apply the 300-day period to the creditor, especially since the creditorrÃ¢Â€s plan was in the best interests of creditors and the estate. In making that determination, the Court evaluated the requirements of § 1129(a) and (b) and concluded that the plan was filed in good faith, was fair and equitable, and did not discriminate unfairly.
Posted: 12/26/2012 11:11:33 AM
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