The Debtor sought to modify the financial reporting requirements of Federal Rule of Bankruptcy Procedure 2015.3 in three ways. The Debtor contended that the financial reporting should not be required because the Debtor's interests in the entities are not "substantial or controlling" for purposes of Rule 2015.3. The Debtor requested that even if the reporting requirements are not waived, the Court should modify the Rule 2015.3 requirement to provide that all reports are to be filed under seal and accessible only to those creditors willing to sign a confidentiality agreement. The Debtor also requested an enlargement of time in which to file his first Rule 2015.3 report, with each subsequent report to be filed at six-month intervals.
The Court found that the Debtor failed to rebut the presumption that he has a substantial or controlling interest in six of the seven entities listed in his schedules. With regard to the request for reports to be filed under seal, the Court found that the Debtor did not meet his burden of proving that the information should be protected under 11 U.S.C. § 107(b), noting that the Debtor's statement regarding his desire for confidentiality to protect other investors is not a basis to seal records from public view. The Court granted the Debtor's request to extend the deadline to file his initial Rule 2015.3 report, with subsequent reports due every six months.
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(Judge: Lena M. James)
(Judge: Lena M. James)
Pursuant to 11 U.S.C. § 1183(b)(2) the Court ordered the appointed subchapter V trustee to perform expanded duties specified in §§ 1106(a)(3) and (a)(4), limited in this case to investigating potential intercompany claims.
(Judge: Benjamin A. Kahn)
Order overruling Bankruptcy Administrator's objection to Debtor's small business designation under Rule 1020.
(Judge: Benjamin A. Kahn)
Order denying motion for stay pending appeal and to suspend proceedings.
(Judge: Benjamin A. Kahn)
Debtor filed a complaint against Creditor for willfully violating the automatic stay by repossessing Debtor’s vehicle post-petition, refusing to return it, and demanding payment of the pre-petition obligation, all after having been notified of the pending bankruptcy and the automatic stay. The Court determined that Creditor willfully violated the automatic stay, and ordered Creditor to pay Debtor actual damages, including attorneys’ fees and costs, in the total amount of $3,963.90. The Court determined that Creditor's actions further justified the imposition of punitive damages. After considering the Supreme Court's guideposts for courts to consider when assessing punitive damages, the Court awarded total punitive damages of $15,000, allocating the total amount among the various violations.
(Judge: Lena M. James)
Defendants CitiFinancial and Carrington Mortgage Services, two former holders/servicers of the Plaintiffs' mortgage, requested dismissal of the complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted, for three separate causes of action. The Plaintiffs alleged that the two Defendants violated § 524(i) with misapplication of payments and an inflated account payoff balance. The Court determined that the Plaintiffs' allegations that CitiFinancial and Carrington both transferred Plaintiffs' mortgage account with an inflated balance due to misapplied payments is sufficient to constitute an act to collect for the purposes of withdtanding a motion to dismiss under Rule 12(b)(6). Also, the Court found that the Plaintiffs plausibly pleaded the elements required under § 362(k) for violation of the automatic stay. The Plaintiffs' alleged violation of the FDCPA against Carrington is not related to the bankruptcy case and the Court lacks subject matter jurisdiction over that count of the complaint.
(Judge: Benjamin A. Kahn)
Claimant, a former principal of Debtor The Benefit Corner, LLC, filed a proof of claim on July 26, 2019, over two years past the bar date. Claimant contended that he filed the claim on behalf of a creditor and that the filing was governed by Rule 3005, not Rule 3002. The Court concluded that the claim was governed by Rule 3002(c), rather than Rule 3005, and that the Court therefore could not extend the time to file based on excusable neglect. Moreover, even if the claim were filed under Rule 3005, Claimant failed to establish that his failure to timely file the claim was the result of excusable neglect. The Court sustained the objection.
(Judge: Benjamin A. Kahn)
Claimant, a former employee of Debtor Bitech Inc., filed a claim in the total amount of $11,113,738.34. Among the amounts asserted in the claim, Claimant sought to recover $5,945,850.00 for civil penalties under Sections 226 and 1198 of the California Labor Code and the California Labor Code Private Attorneys General Act of 2004. Claimant asserted that the portion of his claim for civil penalties was entitled to priority under 11 U.S.C. § 507(a)(8). Debtors objected to the claim in its entirety, but Debtors sought an interim determination as to whether any portion of the claim was entitled to priority under § 507(a)(8). The Court concluded that no portion of the claim is entitled to priority under § 507(a)(8) and sustained Debtors’ objection to the extent Debtors objected to the priority status of any portion of the claim.
(Judge: Benjamin A. Kahn)
Order denying special counsel’s fee application due to special counsel’s failure to disclose substantial outstanding legal fees he asserts are owed to him by the estate for his pre-petition representation of Debtors.
(Judge: Benjamin A. Kahn)
Plaintiff, an attorney, commenced an adversary proceeding against his former clients, Defendants, requesting that the Court either deny the Defendants’ discharge under §§ 727(a)(2)(A) and (B), and 727(a)(4)(A), (C), and (D), or determine that the debt owed by the Defendants to Plaintiff is nondischargeable under §§ 523(a)(2)(A) and (B). Plaintiff moved to amend his complaint and Defendants moved for judgment on the pleadings. The Court granted the motion to amend in part and denied the motion to amend in part. The Court granted the motion for judgment on the pleadings in part and denied the motion for judgment on the pleadings in part. The Court also granted Plaintiff leave to file a further motion to amend consistent with the Court’s Order.
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